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rjmghome

Listed below are comments made by rjmghome between Wednesday, 29th October 2008 and Friday, 11th September 2009.

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How Rover executives pocketed £42m 08:35am on 11 Sep 2009 It would be helpful and responsible journalism if Mr Peston could shed some light on the amount of salary and annual pension that the directors of Rover were paid. The headline grabbing numbers include the capital value of the pension, an amount that these people will not receive.

A police officer above says that he recived an a lump sum of £122k and has an annual pension of £20k pa: Depending on what assumptions you make, this probably has a capital value of somewhere between £0.5m and £4.0m: However, I'm sure the officer doesn't feel like a millionaire.

Come on Peston, let's try and explain the numbers, not just stoke up indignation.
Semenya left stranded by storm 07:41am on 20 Aug 2009 Jarmila Kratochvílová, the 1983 world record holder (153.28!!!) shared a number of characteristics: She came out of nowhere, was no oil painting and had to deal with rumours that were never heard about the more "fragrant" East German athletes of her day - all of whom were subsequently found to be doped.
Steely Ennis has golden glow 12:48pm on 17 Aug 2009 How great to have a champion who looks like she enjoys doing what she does. I can't remember a happier looking winner since Martina Hingis first won at Wimbledon. Long may she smile and let's hope it's infectious.
Can non-execs cure banks' madness and badness? 08:03am on 16 Jul 2009 So the suggestion is to have active non-execs, shareholders who use their influence to cause change rather than just selling and moving on and tie management's rewards to the achievement of value growth, not cash bonuses. That sounds an awful lot like the private equity governance model to me; A model that has been under a hail of criticism, here amongst other places.
Does Europe need hedge funds? 7:37pm on 09 Jul 2009 Many of the objections are to bad legislation, not to legislation. The EU directive on alternative fund investors is ill-thought out and includes a mixture of reporting, capital adequacy and employee consultation regulations that should at a minimum be treated separately.

According to the pre-amble of the directive itself, private equity did NOT contribute to the financial crisis, indeed a few seconds thought about how PE funds are structured would show that the limited life fund acts as a stop to contagion in the market. Hedge funds offering investor liquidity may (and have) suffered due to the credit crunch but are far too small to have caused it. At worst they passed on contagious diseases dreamt up in the labs of investment banks elsewhere.

PE took advantage of cheap debt and used CDOs to distribute and syndicate debt for large LBOs. Hedge funds adopted trading strategies to profit from the vulnerability of financial institutions. Neither of these strategies caused the banking crisis.

Well thought out capital adequacy and reporting regulations would be welcomed by responsible fund managers, but the AIF regulations are a politically inspired assault on a mythical group of "financial locusts" who actually manage our pensions amongst other things.
Hobbling hedgies and bashing buyout boys 10:06am on 02 May 2009 The proposed regulations are irrational and are a the consequence targetted attack on Anglo-Saxon free market practices by the European Socialist Group (PES).

According to the EU report being discused, Private Equity has no impact on systemic risk and hedge funds only create systemic risk through gearing within the fund structure. The mis-matches in the liquidity offered investors with the liquidity of the assets invested in resulted in the collapse of some funds creating losses in their investors (typically banks).

Private equity and hedge funds are totally different approaches to investment: PE is a long term fund structure offering investors no liquidity, Hedge funds use trading strategies in, generally, liquid assets and offer investors (periodic)liquidity.

They are no more alike than walking and hang gliding as a means of transport and should be regulated separately.
Barclays' painful deal 1:46pm on 15 Apr 2009 The business has been publicly marketed to achieve the best price possible today. CVC are a buyout house who need debt to fund a purchase. Which bank is better placed to understand ishares better than Barclays?

Barclays has a right to 25% of any upside over a hurdle rate i.e. if they sold it too cheap, they get 25% of the upside.

If they oversold it, they have undertaken to hold 51% of the debt for 5 years; i.e. If it defaults they will control the banking syndicate and be able to regain control.

Why not report the whole deal?
Aussies worth a listen 08:18am on 08 Apr 2009 What a strange article - Iain Carter interviews Geoff Ogilvy and Gregg Norman and concludes that Tiger Woods doesn't talk to journalists the way he would like him to. And that's worth writing about?
Mumbai, Twitter and live updates 1:53pm on 04 Dec 2008 If we wanted a publicly funded search engine, message board or blog, presumably we could have had one. The BBC is becoming increasingly lazy and reports what other reporters and miscellaneous vox pop are saying rather than relying on its own considerable resources to publish the facts after checking them.

Phone-ins have replaced informed analysis, blogs replaced thought pieces and balance is defined as allowing anybody who has anything to say a platform to say it (including me!) rather than giving those with considered views on both sides of a debate a level playing field.

Thank God for the continued conservatism of the BBC Radio world service.
Hedge funds and VW: what a pile up! 10:01am on 29 Oct 2008 1. there is a serious point to be made: We are all suffering due to market failure. Markets fail due to information asymmetry- I know things you don't. VW/Porsche used derivatives to (potentially) transfer control without disclosing the transaction in a timely manner. As a result losses were incurred by various investors including hedge funds. If this type of "secret" trading occurs, markets will not be efficient and all of us will lose.

2. To those who are expressing joy at the losses: Whose money do you think hedge funds are investing? It's probably a portion of your pension, or your insurance company.

3. Finally, when will Robert Peston and the BBC stop lumping Hedge funds with Private equity? They are totally different - I got so mad about this I wrote a book on the subject: http://www.icaew.com/index.cfm/route/160216/icaew_ga/en/Technical_Business_Topics/Thought_leadership/Private_equity_demystified_An_explanatory_guide

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