The Wall Street Job Report

JPMorgan to launch global corporate bank unit

By Francesco Guerrera and Justin Baer for the Financial Times,  January 28 2010

JPMorgan Chase is launching a global business aimed at selling loans and commercial banking services to multinational corporations, pitting the US bank against Citigroup and HSBC.

The creation of a global corporate banking unit, which has not been announced, will see JPMorgan invest substantial resources and hire hundreds of bankers in an effort to win a bigger slice of international business.

People close to the situation said that the new business, which will sell products ranging from loans and commodities trading to cash management services, would initially focus on fast-growing economies such as China, India and Brazil.

The UK, Germany and Switzerland will also be in the first wave of countries to be targeted, with a view to expanding the unit’s reach to the rest of the world over the years.

The move by JPMorgan is emblematic of the changes in global banking following the turmoil and could open up a market that has traditionally been dominated by Citi and HSBC.

JPMorgan executives said that the launch was aimed at reducing reliance on the slow- growing US economy and taking advantage of a weakened Citi. The US accounts for about three-quarters of JPMorgan’s revenues.

Greg Guyett, JPMorgan’s head of Japan who will move to London to lead the new unit, told the Financial Times: “We are doing this now for a couple of reasons . . . to balance our growth and increase the portion of our revenues that comes from outside the US and from emerging markets in particular; and because, after the crisis, a number of our competitors are challenged.”

He said that JPMorgan would invest more than $100m in building the corporate bank, which would have 300 bankers.

JPMorgan’s executives believe the company’s global investment banking network will provide it with valuable access to top executives, while its financial strength will enable it to compete in price and quality.

Mr Guyett said JPMorgan would use its balance sheet to lend to international corporate clients. Loans are the entry point for banks wanting to win business from international companies.

“The rationale for growing this business is compelling,” wrote Jes Staley, head of JPMorgan’s investment bank, and Heidi Miller, who runs its treasury and securities services business, in a recent note to staff.

“Increasingly we are hearing from our clients that they want more corporate bank services in more of the international locations where they operate.”

Separately, JPMorgan on Thursday announced that Steve Black, the former co-head of the investment bank, would become a vice-chairman. Mr Black had become executive chairman of the investment bank in September when JPMorgan ousted Bill Winters, the other co-head, and moved Mr Staley to run the unit.

 

Morgan Stanley’s Mack on Compensation and the Bank Tax

By the New York Times, January 29, 2010

While top executives at many of the major Wall Street banks are on hand at the World Economic Forum in Davos, Switzerland, most of them are keeping their heads down in light of the populist sentiment dominating the discussion.

Even so, a few of them are speaking publicly about the challenges the finance industry faces and how banks are responding to the prevailing mood of re-regulation. One of them is John J. Mack, the chairman of Morgan Stanley.

Mr. Mack told CNBC’s Becky Quick that Wall Street had lost control during the financial crisis, especially regarding executive compensation. But he added that his firm had modified the way it paid its leaders, including new clawback provisions and a bigger component of the bonus consisting of stock.

“I think in the past, there’s no question, we took things a little too far,” he said.

 

Wall St. Tries to Put a Price on Volcker Rule

By Cyrus Sanati for the New York Times, January 29, 2010

 

President Obama is pushing hard for stricter financial regulation, promising in his first State of the Union address that he would not sign a bill that “does not meet the test of real reform.” This has left Wall Street wondering how much Mr. Obama’s regulatory proposal, known as the Volcker Rule, will cut into its profits.

The proposal, named for Paul A. Volcker, the former Federal Reserve chairman, would limit a bank’s ability to trade on its own account and would ban banks from investing in hedge funds and private equity funds. It could put an end to the huge Wall Street profit machines that emerged in the last decade since financial deregulation. Some analysts are already offering estimates about how costly the Volcker Rule could be.

In general, most analysts feel that Goldman Sachs has the most to lose if Congress passes some form of the Volcker Rule. David A. Viniar, Goldman’s chief financial officer, told analysts last week that the firm derives about 10 percent of its revenue from proprietary trading.

As such, Citigroup estimates that the Volcker Rule would cost Goldman $4.5 billion in revenue based on its 2010 estimates, translating to a $1 billion drop in profit. Analysts at JPMorgan Chase said the Volcker Rule would knock about $4.67 billion off Goldman’s future revenue stream, but they came to their projection a different way, estimating that the firm would experience a 20 percent decrease in its overall trading revenue.

Meanwhile, analysts believe that Morgan Stanley has less to lose than Goldman, as it shuttered most of its proprietary trading units after it was hit with huge losses in those divisions during the financial crisis. The firm has only two small proprietary desks left, one of which the bank is considering spinning off.

Factoring in losses from Morgan’s private equity and hedge funds business, Citigroup estimates the firm’s future revenue could decline 3 to 4 percent. Meanwhile, JPMorgan analysts estimate the firm could take a 15 percent hit to its overall trading revenue, about a $2 billion reduction in earnings.

JPMorgan, like Morgan Stanley, also got rid of most of its proprietary trading units after experiencing big losses, so it, too, is not expected to suffer as badly as Goldman on the trading front, but it will still take a hit from pulling out of its $7.3 billion in private equity investments.

Citigroup estimates that JPMorgan’s private equity business generates earnings of 15 cents a share for the bank. Meanwhile, analysts at Morgan Stanley estimate that JPMorgan would have a 3 to 5 percent hit to its earnings over time based on reduced trading and private equity investing.

Citigroup would likely take most of its hit from its proprietary trading units, as the firm is already in the process of getting rid of most of its hedge fund and private equity fund investments. Morgan Stanley estimates the bank’s overall revenue could be reduced 2 to 5 percent if it suffers a 5 to 15 percent decrease in trading revenue. Put in perspective, Morgan Stanley estimates that Citigroup could lose $134 million to $534 million from its bottom line in 2012, based on the bank’s making $3.5 billion after tax in trading that year.

Bank of America is expected to take minor hits from its private equity and proprietary trading businesses. Citigroup estimates that the bank has about $16.6 billion in private equity investments that it may have to get rid of, but that is small compared with its balance sheet. Citigroup estimates that Bank of America generates only 2 percent from that investment anyway, so the hit would be minor. Meanwhile, analysts at Morgan Stanley estimate that the bank’s bottom line would fall 3 to 5 percent through reduced trading activity and private equity investments.

But all the analysts warned that their estimates were based on factoring out earnings from the banks’ wholly owned proprietary trading units and not taking into account trading the banks perform to facilitate client trades.

If the Volcker Rule is narrowly defined to count just trades done purely with the bank’s money, then the analysis would likely be correct. But if the Volcker Rule is broadly defined to encompass all trading that might put the firm’s balance sheet at risk, the banks could face higher costs.

That’s because 90 percent of the banks’ proprietary trading activity is linked to trades made on behalf of clients as the banks make markets to facilitate trades, Goldman recently said in a note to clients.

For example, Morgan Stanley and JPMorgan are large commodity traders, so they take on a lot of principal risk on behalf of clients because of the illiquid nature of that business. If the Volcker Rule is broadly defined to encompass that kind of proprietary trading, the two firms would have to stop performing that service, translating to a big loss to their bottom lines that would be far above analysts’ estimates.

If broadly defined, firms like Goldman and Morgan Stanley could simply give up their bank holding company status and operate without the government safety net — even though both have said they have no plans to do so. But for banks like JPMorgan, Bank of America and Citigroup, which have huge retail banking operations and cannot give up their banking charters, the Volcker Rule fallout could be very expensive in terms of lost profits.

Of course, the Volcker Rule may look very different once Congress gets its hands on it. It is not yet part of either of the financial regulatory packages in the House or Senate, and much will depend on committee hearings on the proposal in the weeks to come. The Senate is expected to take up the issue on Tuesday.

 

Steve Black Named Vice Chairman, JPMorgan Chase

By BusinessWire, January 29, 2010

JPMorgan Chase & Co. (NYSE: JPM) today announced that Steve Black, Executive Chairman of the Investment Bank, has been named Vice Chairman of JPMorgan Chase. He will continue to report to Jamie Dimon, CEO of JPMorgan Chase, and serve on the firm’s Operating Committee. Jes Staley, CEO of the Investment Bank, will now have sole responsibility for the Investment Bank, reporting to Jamie Dimon.

“Steve led the Investment Bank through one of the most difficult and complex times in our history, and helped build it into the market leader it is today,” said Mr. Dimon. “The transition to Jes Staley as CEO of the Investment Bank has gone smoothly and quickly, and Steve has said that he would like to focus more of his time on advising our clients.”

In his role as Vice Chairman, Mr. Black will:

Work with the firm’s largest global clients, including governments, financial institutions and investors

Advance the firm’s international growth strategy

Represent the firm with global regulatory and monetary authorities as one of its most senior executives

“With the leadership transition completed, I am ready to step away from the day-to-day management of the Investment Bank to focus on something else I love to do – work with clients,” said Steve Black. “The issues our clients are facing are more complex than ever and many are asking for deeper engagement from our senior team. I’m looking forward to shifting my attention to our global clients and leveraging what I have learned in my career to help them however I can.”

He added, “I have been privileged to lead the Investment Bank for the past five years and work with the exceptionally talented people there for the last decade. I am very proud to have worked with them to build the preeminent investment bank in the world.”

“I want to thank Steve for helping me get up to speed so quickly in transitioning the leadership of the Investment Bank,” said Jes Staley. “He’s been a terrific partner, and I’ll know I’ll continue to benefit from his advice.”

 

India Raises Banks' Reserve Requirements

By HEATHER TIMMONS for the New York Times,  January 29, 2010

Hoping to tamp down inflation without stalling economic recovery, the Indian central bank acted cautiously on Friday by increasing banks’ reserve requirements but leaving interest rates unchanged.

The Reserve Bank of India raised the cash reserve ratio, or the percentage of deposits banks must have on hand as cash, by three-quarters of a percentage point, to 5.75 percent. That was more than the 0.5 percentage point rise most analysts had expected.

The change will absorb 360 billion rupees, or about $7.8 billion, from the Indian financial system, the central bank said. “Even amidst concerns about rising inflation, we must remember that the recovery is yet to fully take hold,” the central bank said.

The central bank left the repo rate, a key lending rate, steady at 4.75 per cent. But most economists expect it to lift rates by the end of April.

“We need to tighten,” the bank’s governor, Duvvuri Subbarao, said at a news conference, Associated Press reported. “An increase in policy rates will happen sometime in the future.”

Central bankers in India and other Asian nations face a dilemma: Their economies are heating up, but there is no guarantee that there will not be a “double dip” recession in developed countries that could hurt them, meaning economies in the United States and Europe would contract again.

The issue is “how to make it look like a tightening when the real objective is to leave liquidity conditions little changed,” said the UBS economist Philip Wyatt. The Indian central bank’s action Friday “shouldn’t be a significant restraint on the economy,” he said.

The Indian economy grew 7.9 percent year on year in the July-to-September quarter, far better than most other countries. But inflation is rising, with food prices in particular rising sharply. The inflation rate in December was 7.3 percent, up from 4.8 percent in November; some analysts say it could hit 9 percent in coming months.

That is mainly because the costs of essentials like vegetables and grains have risen after droughts and floods. India, which usually produces nearly all the food that it needs, may need to import, government officials said late last year.

The food price index increased 17.4 percent in the week that ended Jan. 16 from the previous week. Grain prices are up about 47 percent from a year ago.

“For several months, rapidly rising food inflation has been a cause for concern,” the central bank said Friday. “More recently, there are indications that the sustained increase in food prices is beginning to spill over into other commodities and services as well.”

The Reserve Bank said prices of manufactured goods had increased in the past two months, in part because of rising food prices.

Unlike China, India is showing few signs of an overheating economy over all. Indian stock markets are not inflated, analysts say, and there are few concerns about bubbles in other areas of the economy.

Equity prices “don’t look out of line: They’re neither expensive nor cheap,” said Samiran Chakraborty, head of India research at Standard Chartered Bank. Real estate prices are still high, he said, but the volume of deals has gone down, allaying fears of a housing and commercial building bubble.

The Bombay Stock Exchange’s Sensex average rebounded slightly on Friday, to close up 0.31 percent, after falling sharply during the week ahead of the bank’s monetary policy review.

The bank’s changes Friday may not be a big factor for many corporations, analysts said. Getting loans has not been a problem for most companies, said Bhavesh Kanani, a research analyst at Sharekhan, a Mumbai brokerage. Banks are extending credit, he said, but the companies taking out the loans are not using the cash yet. They are waiting to see how long the global economic recovery will last before starting big projects.

The central bank also signaled that it was still watching for weakness in the domestic economy. “Even as most of the forecasts on recovery are generally optimistic, significant risks remain,” the bank said, adding that the recovery in India is “still unbalanced.”

“Public expenditure continues to play a dominant role, and performance across sectors is uneven,” the bank said.

 

Bank Tax Is Knotty Issue for New York’s Senators

By RAYMOND HERNANDEZ for The New York Times,  January 28, 2010

President Obama’s proposal to impose new taxes on large banks is testing the ties New York’s United States senators have with Wall Street, a pillar of the state’s economy and a major source of their campaign dollars.

The plan that Mr. Obama introduced is intended to help the federal government recover the billions of dollars it handed out to struggling financial institutions last year as the White House and Congress sought to avert an economic collapse.

Mr. Obama used his annual address to Congress on Wednesday night to make a case for the plan, as he acknowledged the public’s unhappiness with the bank bailout at a time of high unemployment and rapidly growing federal budget deficits.

“I know Wall Street isn’t keen on this idea,” Mr. Obama said of his proposal, which is expected to raise $117 billion over 12 years. “But if these firms can afford to hand out big bonuses again, they can afford a modest fee to pay back the taxpayers who rescued them in their time of need.”

But in New York, the plan has created something of a quandary for Senators Charles E. Schumer and Kirsten E. Gillibrand (Above), two moderate Democrats who are on the ballot this year and who have largely refrained from the kind of anti-Wall Street rhetoric used by liberals in the party.

While Mr. Schumer is said by associates to be troubled by some of the attacks being leveled at Wall Street, he embraced the president’s proposal the day it was offered. He argues that the original bailout package actually requires the president to try to recover the bailout money from financial institutions if the money is not paid back after a certain period.

But Mr. Schumer’s position has surprised and frustrated his allies on Wall Street, where he has raised vast sums of money through his career, both for himself and for the national party.

Indeed, of the roughly $8.7 million he has collected since his last election, in 2004, about $1 million came from the financial industry, according to an analysis by the Center for Responsive Politics, a nonpartisan government watchdog organization.

At the same time, Mr. Schumer, a member of two committees with jurisdiction over the industry, has been a strong advocate for Wall Street, having been among the first officials in Washington to promote the rescue package as the financial crisis rocked the nation in late 2008.

A lobbyist for Wall Street interests, who asked not to be identified because he did not want to be seen as questioning Mr. Schumer’s approach, said financial leaders are sympathetic to the tough political climate Mr. Schumer finds himself in, with public sentiment turning against Wall Street. But the lobbyist said people in the financial world are nonetheless frustrated that the senator has not waged a more vigorous public defense of his hometown industry.

Responding to such concerns, Brian Fallon, a spokesman for Mr. Schumer, said that while the senator believes that many practices on Wall Street must be reformed, “he will work to make sure the corrections will be productive, not vindictive, in order to create a stronger financial services industry in the future.”

In many respects, the issue has been much trickier for Ms. Gillibrand, who, unlike Mr. Schumer, is facing the prospect of a strong challenge this year and who has also turned to Wall Street to raise money through the years.

The senator has yet to say whether she supports or opposes the Obama proposal, even as her potential rival for the Democratic nomination, Harold E. Ford Jr., positions himself as a defender of Wall Street, where he is getting much of his initial support. Instead, Ms. Gillibrand has proposed giving banks a break on the tax based on how many loans they are providing to small businesses.

By contrast, Mr. Ford, a former congressman from Tennessee who moved to New York three years ago to take a job in banking, flatly rejects the tax. He argues that it could severely damage the city’s financial industry and, in turn, undermine New York’s economy.

Mr. Ford’s position is more closely aligned with that of Bruce A. Blakeman, a Long Island Republican running for Ms. Gillibrand’s seat. “It’s an attack on the financial industry,” Mr. Blakeman said of the tax. “I am going to be an outspoken advocate for our most important industry.”

 

Senate, Weakly, Backs New Term for Bernanke

By SEWELL CHAN for the New York Times,  January 28, 2010

The Senate gave Ben S. Bernanke a second four-year term as the head of the Federal Reserve on Thursday after critics excoriated the central bank’s conduct in the years leading up to the financial crisis.

The 70-to-30 vote was the weakest endorsement ever extended to a chairman in the Fed’s 96-year history.

The confirmation was a victory for President Obama, who had called Mr. Bernanke an architect of the recovery, but also signaled the extent to which the Fed, once little known to the public, has become the object of outrage over high unemployment and bank bailouts.

In several hours of debate, senators said that the Fed had abetted, then ignored, the housing and credit bubbles and allowed banks to keep dangerously low capital reserves and to make reckless lending decisions that ruined consumers. Some even blamed Mr. Bernanke for the falling dollar and questioned his commitment to free enterprise.

In contrast, Mr. Bernanke’s supporters were muted. They reiterated that the Fed had made mistakes but said that Mr. Bernanke had helped save the economy from a far worse recession.

After a week in which top White House officials and Mr. Bernanke met with Democratic leaders in the Senate to secure support, the Senate first voted 77 to 23 to end debate, with more than the 60 votes needed to overcome the threat of a filibuster.

On a second vote, to confirm, the 30 dissents came from 18 Republicans, 11 Democrats and one independent, Bernard Sanders of Vermont.

On Thursday evening, Mr. Obama congratulated Mr. Bernanke in a statement. “As the nation continues to face the consequences of the worst recession in a generation, Ben Bernanke has provided wisdom and steady leadership in the midst of the financial and economic crisis,” he said.

While an arm-twisting campaign by the administration limited the opposition, the outcry against the Fed will most likely continue rippling through economic policy generally, and Mr. Bernanke’s leadership of the Fed in particular. The effects could be felt first in the debate over how to reform financial regulations. The Obama administration has proposed consolidating risk regulation under the Fed, while some in Congress want to strip away its oversight authority.

“The institutional prestige of the Fed, even apart from this vote, had taken a hit, and it started back around the disaster of September 2008,” said Stephen H. Axilrod, who worked at the Fed for 34 years and wrote a history of its monetary policies. “I don’t think it has recovered. This is a low point in the Fed’s recent history, that’s for sure.”

The vote also made clear Congress’s insistence on transparency from a historically secretive institution that has made extraordinary interventions in the market since 2008.

“The Fed is going to have to work hard, for a long period, to regain the public confidence of the sort it enjoyed during the halcyon days when everything was going so swimmingly,” said Barry Eichengreen, professor of economics and political science at the University of California, Berkeley.

Senators from opposite ends of the spectrum formed unlikely alliances. After Mr. Sanders, who calls himself a socialist, finished denouncing Mr. Bernanke, Jeff Sessions, a conservative Republican from Alabama, rose to do the same.

Another Alabaman, Richard C. Shelby, the top Republican on the banking committee, which approved the nomination last month by a 16-to-7 vote, laid out a bill of particulars, saying Mr. Bernanke’s handling of the financial crisis did not make up for his failings before that time.

“Considerable economic devastation occurred as a result of Chairman Bernanke’s loose monetary policy and weak regulatory oversight,” Mr. Shelby said. “If we don’t hold Chairman Bernanke accountable, what precedent are we setting for future regulators?”

To an extent, the rhetoric against Mr. Bernanke reflected a spilling-over of frustration at two of his collaborators: the former Treasury secretary, Henry M. Paulson Jr., and the current one, Timothy F. Geithner.

And looming over it all was the role of Mr. Bernanke’s predecessor, Alan Greenspan, whose once-sterling reputation has been diminished as his decisions to keep interest rates low after the 2001 recession have been brought into question.

Mr. Bernanke, 56, was a member of the Fed’s board for part of that period, from 2002 to 2005, when President George W. Bush named him to lead his Council of Economic Advisers. He rejoined the Fed, as chairman, in 2006, and Mr. Obama renominated him last year. Mr. Bernanke is a Republican economist and an authority on the Depression.

“I knew that he would continue the legacy of Alan Greenspan, and I was right,” said Senator Jim Bunning, Republican of Kentucky, who was the lone vote against Mr. Bernanke in 2005.

Mr. Bunning cited a half-dozen statements from 2007 to 2009 in which Mr. Bernanke expressed optimism about the housing market, bank capital ratios, the capitalization of Fannie Mae and Freddie Mac and the unemployment rate. Saying that Mr. Bernanke had been repeatedly wrong, he declared, “We shouldn’t be paying the Fed chairman to learn on the job.”

Senator Sheldon Whitehouse, Democrat of Rhode Island, echoed that, saying Mr. Bernanke had shown “a troubling pattern of false confidence.” Senator Jeff Merkley, Democrat of Oregon, went further, saying the Fed had “helped set the fire that destroyed our economy.”

While less passionate, supporters of Mr. Bernanke said he had acted deftly and decisively, at least since the collapse of Lehman Brothers in September 2008.

“He basically allowed the Fed to become the lender of the nation,” said Senator Judd Gregg, Republican of New Hampshire. “Nobody had ever done that. The way he did it was extraordinary in its creativity, and the results were that the country’s financial system did not collapse.”

The last time any nominee for chairman faced such opposition was 1983, when the Senate confirmed Paul A. Volcker to a second term on an 84-to-16 vote. Mr. Volcker, too, had served under presidents of opposing parties and had navigated the Fed through a difficult recession.

But while Mr. Volcker sharply raised interest rates to tame runaway inflation — actions that were initially unpopular but were later praised — Mr. Bernanke faces a different challenge. The Fed has held short-term interest rates near zero since December 2008, a policy reaffirmed on Wednesday. And while analysts expect rates to start rising later this year, the scale and timing of that rise will be a challenge. So, too, will be the unwinding of the Fed’s emergency lending programs and its purchase of $1.25 trillion in mortgage-backed securities.

Many politicians will not want the Fed to put the brakes on recovery by raising rates. Indeed, the Senate majority leader, Harry Reid of Nevada, offered only a lukewarm endorsement last week after telling Mr. Bernanke that the Fed must do more to ease lending to households and small businesses. While the Fed says Mr. Bernanke gave Mr. Reid no specific commitments, the central bank will continue to face close scrutiny.

“Their independence from political pressures has been tarnished,” Mr. Axilrod said. “And if the market believes the Fed will not control inflation, there will be more inflation.”

 

Davos: A tug from Zug as financiers plot UK exodus

By Katherine Griffiths, Miles Costello Patrick Hosking for The Times Online, January 29, 2010

Senior financiers are using top-level meetings in Davos to warn that the hostile tax regime in Britain will persuade many bankers to move to Switzerland.

The group is expected to use a meeting with Alistair Darling today to complain about the “victimisation” of the banking industry and to say that the looming rise in top rate income tax, the 50 per cent bonus tax and the rule that 60 per cent of bonuses must be deferred for anyone earning more than £1 million make the UK far less attractive than other countries.

Two senior bankers attending the World Economic Forum said yesterday that a substantial number of employees had asked to leave London. “Banks like us are going to have to think hard about whether we respond to staff requests,” one boss said.

Some employees, particularly Americans who have been working in their London offices, are asking to go home. Others are apparently being seduced by the low taxes and high standard of living in Switzerland.

Several Swiss cantons have been marketing themselves in London, with Zug — the tiny canton where individuals can pay about 10 per cent in income tax — one of the most active.

A business group representing eight cantons, the Greater Zurich Area, has already marketed the region in London, and individual cantons have similar plans.

Marc Rudolf, a business development manager for the Greater Zurich Area, spoke at an event for hedge fund managers in London in September and said that “many more events” were planned for this month and next. Law and accountancy firms are planning such events for hedge funds and other wealthy clients, Mr Rudolf said.

While big banks consider requests from staff for moves, more nimble hedge fund managers are already packing their suitcases. Kinetic, a leading hedge fund consultancy, estimates that as many as 150 hedge fund managers will leave the UK and relocate to Geneva, Zurich or another Swiss canton before the new tax year.

The Chancellor’s 50 per cent tax rate on incomes above £150,000 comes into effect on April 6. This, and other tax measures regarded by hedge funds as anti-entrepreneurial, has led them to seek more tax-efficient locations, they say.

Kinetic has advised 23 hedge funds in the past 18 months on their plans to relocate from London to Switzerland. Andrew Shrimpton, a partner at Kinetic, said his consultancy was working with hedge funds that have recently moved staff to Switzerland to ensure that their managers comply with regulations put in place by the Financial Services Authority.

Staff based outside the UK are not obliged to conform to FSA guidelines, “but investors are often comforted if they do,” he said. Kinetic has been carrying out FSA “health checks” for a dozen Swiss-based hedge funds, ten of which have moved there from Britain.

BlueCrest, a London hedge fund manager, has already decided to relocate 50 of its 340 staff to Geneva. The company, whose offices at present overlook Buckingham Palace Gardens, is planning the move before April.

Others could follow, including Brevan Howard Asset Management, Europe’s biggest hedge fund, which has invited London staff to consider whether they want to move to Geneva. It has set up an office that could accommodate up to 50 people.

The Times has learnt that the team could include some of Brevan Howard’s highest earners, who are looking at houses and schools in French-speaking Swiss cantons.

“A final decision is likely to be taken by April,” a manager in Geneva said. “They’ll make the move if they can persuade enough of their people to come here and, ultimately, that depends on the wives and children.”

There are drawbacks to moving to Switzerland. Critics point to high house prices, a lack of local business talent and “not much to do”.

In a survey carried out by Financial News, one manager complained about Switzerland’s strict bureaucracy: “Using the wrong colour bag for rubbish results in a SwFr150 (£88) fine — and they track you down,” he told the newspaper.

Another said that soaring property prices and a lack of supply, particularly in Geneva, meant that it was difficult to find accommodation for support staff, many of whom have to commute to work from outside the city.

The leaders of big banks also have a more complex decision to make than hedge funds, as they are engaged in a wider struggle with the Government.

One banker who admitted he had received requests from some of his well-paid staff to move was unwilling to talk about the issue because he did not want to further inflame relations with the Government at a time when politicians around the world are highly critical of bankers’ pay and their activities.

 

Obama And Volcker Vs. Wall Street

Martin T. Sosnoff, Forbes.com, January 27, 2010

 

The huge man stomped out inflation for three decades of investors and workers. Wall Street should be worried about Paul Volcker.

There was an amusement parlor in New York's Chinatown where you played tic-tac-toe against a chicken, but the chicken got first move so unless you played flawlessly you could only draw against your feathered adversary.

The expression “Politics leads economics” suddenly resonates. Our president's health care initiative founders in the Congress. Massachusetts goes Republican with independent crossovers so Obama rolls up his sleeves and trashes Wall Street, a rich pot of meringue eaters who coin money while unemployables cash in food stamps.

Obama has lost me in one short year. The market senses our chief executive is flailing. I've written down the averages by another 5%. A 10% correction in total may be enough for now.

The symbolism of Paul Volcker standing behind his president sent a shudder through my viscera. The apt adjective for Paul Volcker, a 275- to 300-pound giant, is “relentless,” like a battleship engaging the Japanese fleet at Midway, 16-inch guns blasting away with lethal accuracy.

Volcker, an emancipated Federal Reserve Board chairman, forever rates a chapter in our country's economic history. I was fighting the battle for investment survival when Volcker took interest rates up to the mid-teens in 1982, wringing out the inflationary expectations that permeated the country. Actually, Volcker was late in taking away the punch bowl. General Motors and its ilk had given in to the United Auto Workers during the '70s. Toyota, Honda and Volkswagen already took share of market.

Volcker, who dwelled in a modest apartment in Washington, isn't on the same wavelength with traders whose compensation is forever an enticing percentage of what they make for their house. If the house doesn't come across, traders leave and go into business for themselves. Today anyone with a track record can raise billions in capital nearly overnight.

Greed, leverage and tapping your clients' cash deposits for investment capital are big no-no's today. Goldman Sachs and its competitors still hold tens of billions in deposits guaranteed by the FDIC. If they're allowed to become non-banks again, they need to give back this money. I'm sure they can't wait to do so.

When our government took over AIG, it paid off hundred of billions in credit default swaps to Goldman and others who were on the right side of this trade. In that construct Goldman, now coining money, is beholden to our U.S. Treasury and Federal Reserve Board who made these decisions. So are Bank of America and JPMorgan Chase.

Maybe we'll see son-of-Merrill-Lynch in a year or two if banks are forced to separate their banking and brokerage businesses. Obviously it was a great mistake to deep six the Glass-Steagall Act in 1999, and it's coming back in some form or another if Obama gets his way.

There's plenty of blame to go around, and not just for Congress, but regulatory agencies like the Federal Reserve Board, the U.S. Treasury, the Securities and Exchange Commission, the FDIC and Controller of the Currency. Where were these regulators while tens of trillions built up in collateral debt obligations? The rating agencies blessed trashy mortgage backed securities with AAA ratings.

What about Fannie and Freddie, which were allowed to leverage themselves to death insuring home mortgages well into the trillions for a couple of basis points in fees? All along there was an implicit guarantee of the trillions in debt issued by these quasi-government agencies. Their debt was and is widely held by banks, insurance underwriters, institutions and the public. Only the recently issued preferred stock of Fannie and Freddie was allowed to default.

Let me go back to Volcker who was unflappable in 1981-82. Homebuilders mailed him 2x4s in the shape of crosses, but Volcker ignored them and saved the country from its follies. Five-year Fannie Mae paper yielded 15% at the top. A bull market unfolded but not before it touched down at book value. The S&P 500 Index yielded more than 5%. Historically, I remember buying myself a block of Fannie's warrants for peanuts that traded on the American Stock Exchange. The street fears Volcker, an insatiable prince of darkness, for good reasons.

Plenty of intended and unintended consequences followed the Volcker purge. The United Auto Workers and Teamsters topped out as inflationary engines. The country had turned so uncompetitive from huge wage increases that Jack Welch, headman at General Electric resolved to throw capital into factory automation. Everyone followed Jack. Manufacturing employment peaked over 25 years ago at 27% of the work force. Now we're down to 10% and counting. Don't blame everything on the Japanese and the Chinese.

Welch also understood that he could leverage GE's AAA credit rating and diversify into the financial services sector. This would bite GE's ass in the recent credit debacle, and GE is likely to remain an under-owned property for years to come.

I just read an awesome Goldman Sachs 11-page quarterly year-end report, circling paragraphs and underlining sentences on every page. Some tidbits:

--Net earnings of $13.39 billion

--Annualized return on equity of 31.9 percent

--$6.44 billion paid in corporate taxes

--Compensation cut back by $4 billion to it lowest level as a public company

--$500 million contributed to its charitable foundation

--Taxpayers earned $1.42 billion on the U.S. Treasury's $10 billion TARP investment

What Goldman doesn't highlight is the enormous year-over-year dilution in its shares outstanding. So let's kick around Goldie? They earned too much money, but this is no monopoly restraining free trade. Their earnings are kosher. Contrast this with AIG, who foolishly shorted a trillion-dollar tranche of credit default swaps and blew up.

AIG under its old headman, Hank Greenberg, falsified years of reported earnings by taking out insurance policies from General Reinsurance, owned by Berkshire Hathaway. Over a year ago Warren Buffett bought a $5 billion block of Goldman Sachs' preferred stock with warrants when it wasn't as yet clear Goldman was a survivor.

General Re just paid a $90 million fine for its complicity with AIG, a light rap on the knuckles. Should the government demand that Buffett give back his billion plus paper gain on Goldman's warrants?

Initiatives against Wall Street, if not stillborn, could cut Goldman Sachs' earnings by 10%, probably no more than 5% for Bank of America and JPMorgan. The market just gave them their proper haircuts.

Obama's “Change you can believe in” campaign mantra now rings hollow. After the loss in Massachusetts, Democrats, including me, are panic stricken. The strategic blunder was putting a trillion-dollar health care package ahead of infrastructure spending. This wasn't lost on all our unemployables and millions of part-timers living off food stamps who are populists whether they know it or not.

President Obama is no William Jennings Bryan and Wall Street ain't crucifying mankind on a cross of gold. Wall Street is long gold, short the dollar, or vice versa if perceived as a viable trade. Everything coming out of the president's mouth sounds like it was written by a committee of Larry Summers, Paul Volcker, Rahm Emanuel and Timothy Geithner. Have I missed anyone?

This isn't “Give ‘em Hell” Harry Truman campaigning against Tom Dewey or even George Bush harassing Saddam. For those of us who campaigned for Hillary Clinton, Obama gave us the back of his hand when we offered to work for his election. “Just give me your Rolodex,” he quipped.

Gary Kasparov, alluding to playing chess against a computer capable of processing 200 million possible moves, said, “Our best minds have gone into financial engineering instead of real engineering with catastrophic results for both sectors.”

This is an overstatement that applies only to Wall Street's quants. Read Google's quarterly report. This relatively young company is amassing free cash flow at a $2.5 billion quarterly clip. I'm looking forward to the coming face-off with Apple over who controls the advertising flow on cellphones. What an enormous opportunity for both enterprises, awash in cash and needing no federal handout.

New Embattled Minority: Wall Street Brokers

N. R. Kleinfield, The New York Times, January 27, 2010

The well-groomed brokers and traders bent on sticking up for Wall Street gathered on Wednesday in best-behaved form — no chanting, no shrill whistling, pretty much no noise at all — to mark the formation of the financial world’s modest alternative to the Tea Party movement.

Things had gotten entirely too annoying. First it was White House (and populist) complaints about Wall Street recklessness and greed (humongous bonuses). Now it was White House desire to attach new regulations and taxes to banks. Enough!

And so a rally was organized at lunchtime on the 23rd floor of 14 Wall Street, directly across the street from the New York Stock Exchange, in the cushy offices of John Thomas Financial, a three-year-old investment house. It was much more comfortable than, say, the street.

As Thomas Belesis, the 35-year-old chief executive of John Thomas who hatched the idea, put it, “It’s cold out.”

The specific purpose was to announce a nonpartisan organization called restorewallstreet.com, devoted to “bringing the pride back into Wall Street.” The name was savewallstreet.com a day earlier, but Mr. Belesis had a last-minute change of mind. He didn’t feel Wall Street needed saving, just its image polished.

The event didn’t quite go the way it was foreshadowed. The press alert promised a “rally with hundreds of brokers and traders.” In fact, about 30 of the attendees were from elsewhere on Wall Street. The rest were the brokers and traders at John Thomas. Since the rally was held on the firm’s 25,000-square-foot trading floor, where some 100 brokers had their desks, most of the attendees were basically working.

During the rally’s half-hour duration, the numerous flat-screen TVs on the wall were shut off, interrupting the Capitol Hill testimony on the A.I.G. bailout by Henry M. Paulson Jr., the former treasury secretary. That mattered less than that you could no longer see how the market was doing. In any event, it wasn’t doing that great.

The fact that virtually all of the virtually all-male attendees wore suits and ties did make the gathering perhaps the best-dressed rally in history.

After brief remarks by Mr. Belesis (“Due to recent events, we must heed the clarion call for change”), the microphone was given to Bruce A. Blakeman (Above, center), the little-known Long Island Republican lawyer running for the United States Senate (“My friends, we can’t kill the goose that laid the golden egg”). The rest of the rally essentially became a press conference for Mr. Blakeman.

Before the rally began, Mr. Belesis explained that he had begun thinking about forming this group in the last month or so as he heard “the repeating, relentless attacks on Wall Street.”

“I wanted the people who work on Wall Street to be heard,” he said.

Wayne S. Kaufman, the firm’s chief market analyst, alluded to the insulting and “infantile language” like “fat-cat bankers” emanating from President Obama.

“At the end of the day,” he said, “we’re citizens of the United States, too.”

Exactly how the new organization will function was left unclear, though Mr. Belesis said it would stage events and put up signs.

Todd Shapiro, a public relations man helping out, said, “It’s going to be like a Chamber of Commerce and a pit bull for Wall Street.”

It will not confine itself to intrusion from the White House. Mr. Shapiro said: “If someone in the middle of Minnesota says something bad about Wall Street, we will respond.”

This was, of course, delicate territory, Wall Street personnel not being especially high on many peoples’ lists of deprived and maltreated constituencies. There was, in fact, little evident anger expressed at the rally.

David Hilton Page, 45, John Thomas’s managing director of alternative investments, calmly explained how he liked what he heard about the new organization.

Was he angry? “I’m not angry,” he said. “I’m concerned. I think anger is a misused word. Negative thoughts never seem to get me anywhere, so why start now.”

Who would feel sympathy for the rallying Wall Streeters? “That’s a good question,” he said. “I don’t know.”

Johnathan McHale, 30, a John Thomas broker, said he was “blown away” by the idea of the organization. But he wasn’t angry, either. “I’m too focused on raising assets,” he said. “And there’s pretty much a no-negativism policy here.”

Did he feel like a fat cat? “No, not at all,” he said. “I feel like a strong cat.”

He rattled off how he got up at 5:15 in the morning and worked until 4:15 p.m., taking a break to hit the gym before getting back on the phones until 10 at night.

Spend a week in his shoes, he suggested, and “you’ll feel like a tired cat.”

The rally ended a little after 1. The flat screens came alive. Henry Paulson was still testifying. The Dow was down 43 points. It would improve.

Main Street frustration: 'Everything is going to banks'

Catherine Clifford, CNNMoney.com, January 28, 2010

NEW YORK-- In his State of the Union speech Wednesday night, President Obama touted a slew of federal initiatives aimed at stimulating small business hiring and growth. Again.

Small companies employ around half of America's workers and drive most of the country's job growth. Obama talks frequently in his speeches about the vital role small companies play, and his administration has launched several efforts to bolster struggling Main Street businesses. But most of the president's small business proposals remain in limbo, caught in bureaucratic logjams and the Great Black Hole of Congress.

A year ago, Obama set the stage during his first major economic speech to Congress. "I will not spend a single penny for the purpose of rewarding a single Wall Street executive, but I will do whatever it takes to help the small business that can't pay its workers or the family that has saved and still can't get a mortgage," Obama said in February. "That's what this is about. It's not about helping banks; it's about helping people."

But small business owners across the nation say they feel left out of the stimulus and recovery action.

"Basically, it seems to me that Washington's efforts have been to help Wall Street, not Main Street," said Kim Griebling (Above), president of Custom Flag Company in Westminster, Colo. Griebling and her father bought the company in 1998 and now employ a staff of eight. As the economy deteriorated, so did the demand for flags.

Griebling applied in September for an America's Recovery Capital (ARC) loan, an emergency financing program created as part of February's stimulus bill. The program offers qualifying business owners a small, government-backed loan on very attractive terms, but those trying to land ARC loans face a gauntlet of administrative obstacles. While bailed-out financial giants like AIG got financing fast from Washington, business owners wait months.

"People don't realize that $35,000 for a small business makes a huge difference. I am on the verge of possibly having to lay off people," said Griebling. Her loan was approved in December, but she hasn't received the money yet -- and her patience is wearing thin.

"I definitely pay attention, but I would say I am more skeptical," she says of politicians' talk of helping small companies like hers.

Geoffrey Zeamer, the owner of scientific instrument maker Abbess Instruments in Holliston, Mass., also feels that small companies are being overlooked.

"I listen very carefully and on a daily basis as to what is going on, and I have found the last year extremely disheartening because everything is going to banks," Zeamer said.

Zeamer is an engineer who has owned his 17-employee company since 1982. He thinks the government got it backward by funneling money to banks to save the economy.

"If the government really wanted to stimulate business, then you give out orders. You order more planes, trains, you buy more bridges. If you give banks money, they look out and say, 'nobody has any orders, we are not going lend out,'" said Zeamer. "That seems to have escaped them. I think it's Basic Economics 101."

Obama calls for unified effort

Here's a rundown on where President Obama's small business proposals from throughout the past year currently stand:

Tax credits for jobs: The government's economists estimate that small businesses have created 65% of America's new jobs over the past 15 years. In December, Obama delivered a speech at the Brookings Institution in which he endorsed tax breaks to encourage small businesses to hire.

But there's a blizzard of competing proposals for what form those incentives should take, from a temporary payroll tax holiday to per-worker tax credits for new hires, and none have yet gained momentum in Congress.

In the same speech, Obama backed a trifecta of tax cuts intended to spur small business investment and capital spending. Congress hasn't yet taken significant action on any of them.

TARP for community banks: Small businesses are still struggling to access the capital they need for their day-to-day operations.

"When you talk to small business owners in places like Allentown, Pennsylvania or Elyria, Ohio, you find out that even though banks on Wall Street are lending again, they are mostly lending to bigger companies," Obama said Wednesday. "Financing remains difficult for small business owners across the country."

In October, the President proposed a collaboration between the Treasury Department and the Small Business Administration to make capital cheaper for community banks that commit to increasing their small business lending.

Under the proposed plan, banks with less than $1 billion in assets would be able to borrow money from the government at a 3% dividend rate. That's a discount on the 5% rate the Treasury currently offers borrowers through its Capital Purchase Program, a TARP (Troubled Asset Relief Program) initiative.

Three months later, the government is still drafting guidelines for the initiative.

Obama invoked the plan in Wednesday's speech.

"I'm proposing that we take $30 billion of the money Wall Street banks have repaid and use it to help community banks give small businesses the credit they need to stay afloat," he said.

Loan limits: In the same October speech, Obama also threw his support behind Congressional efforts to raise the ceiling on SBA loans. Currently, the maximum loan size available under the SBA's major lending programs is $2 million. Policymakers would like to lift that limit to $5 million.

Both houses of Congress have considered the measure, but they've failed to agree on legislation to enact it into law.

Bigger incentives for loans: Amid a slew of stalled initiatives, one program has seen success.

SBA-backed loans represent a tiny portion of the overall small business lending landscape, but they're a vital lifeline for many new and growing companies. Last year, the SBA's loan volume plunged.

February's Recovery Act set aside a $375 million funding pool to temporarily eliminate fees for a SBA loans and increase the portion of each loan that the government guarantees, up to 90%. That move proved so popular that the money allocated for it ran out around Thanksgiving. Just before Christmas, Congress appropriated another $125 million to keep the incentives running.

The data shows that lending has rebounded from last year's lows. In the three months ended Dec. 31, the SBA's 7(a) program processed more than 12,000 loans totaling $3.8 billion. That's a sharp pickup from the 9,070 loans, totaling $1.9 billion, the agency backed a year earlier.

BofA CEO Moynihan to Get 19 Percent Raise: Report

Clare Baldwin, Reuters, January 27, 2010

NEW YORK - Bank of America <BAC.N> Chief Executive Brian Moynihan (Above) will be paid $950,000 a year for his new job, the Wall Street Journal reported on Wednesday.

The bank's board of directors has approved the salary, which is 19 percent more than Moynihan's 2008 base pay, according to the Journal.

Moynihan will not receive a bonus for 2009, the Journal reported, citing sources familiar with matter. Pay czar Kenneth Feinberg was not consulted, the source said.

Bank of America could not immediately be reached for comment.

By comparison, former CEO Kenneth D. Lewis typically received a base salary of $1.5 million, the Journal said.

Felix Rohatyn Returns to Lazard

BusinessWire.com, January 27, 2010

NEW YORK - Lazard Ltd (NYSE: LAZ) announced today that Felix Rohatyn (Above) has returned to the firm as Special Advisor to Chairman and Chief Executive Officer Kenneth M. Jacobs, effective February 1st. Mr. Rohatyn, based in New York, had a nearly 50-year career at Lazard, as a Partner and Managing Director, until he left in 1997 to serve as United States Ambassador to France. He most recently headed his own private advisory firm, Rohatyn Associates.

“Felix is a legend in our industry, and I am honored that he is returning to the firm that he helped to create,” said Mr. Jacobs. “His wisdom and unparalleled experience working with multi-national organizations, financial institutions and governments, extensive relationships in both the public and private sectors and his long history with Lazard, will provide tremendous value to our clients, to me and our leadership team.”

“Lazard has demonstrated an innate ability to grow and thrive through changes in leadership, capital structure and the economy,” said Mr. Rohatyn. “It has been immensely rewarding to see Ken rise to lead Lazard. I look forward to returning to Lazard to work with Ken and his leadership team, but also to rejoining a firm that has cemented its position as one of the leading financial advisory firms in the world.”

Mr. Rohatyn is a trustee of the Center for Strategic and International Studies, is a member of the Council on Foreign Relations, and serves on the Board of Directors of Publicis Groupe SA and LVMH (Louis Vuitton Moet Hennessey). Mr. Rohatyn started his career at Lazard in 1948, leaving in 1997 for his Ambassadorship to France under President Clinton. He was chairman of the Municipal Assistance Corporation (MAC) of the State of New York from 1975 to 1993, where he managed the negotiations that enabled New York City to resolve its financial crisis in the late 1970s. He also served as a member of the board of governors of the New York Stock Exchange from 1968 to 1972.

About Lazard

Lazard, one of the world's preeminent financial advisory and asset management firms, operates from 39 cities across 24 countries in North America, Europe, Asia, Australia, Central and South America. With origins dating back to 1848, the firm provides advice on mergers and acquisitions, strategic matters, restructuring and capital structure, capital raising and corporate finance, as well as asset management services to corporations, partnerships, institutions, governments and individuals. For more information on Lazard, please visit www.lazard.com.

E*Trade Loss Narrows Sharply as Recovery Continues

The New York Times, January 27, 2010

NEW YORK (Reuters) - E*Trade Financial Corp <ETFC.O> posted its 10th straight quarterly loss, but it was a small fraction of the loss in the year-earlier quarter as the online broker made headway on its crippling bad loans.

With its exposure to mortgage-market losses declining, E*Trade said on Wednesday it was now positioned for "sustainable, profitable growth." The company, hard hit by the mortgage meltdown, has been careful not to forecast when it will return to profitability.

Interim Chief Executive Robert Druskin said on a conference call the company has a preferred CEO candidate in mind, and intended to announce a name in the near future.

E*Trade shares rose 1.8 percent in after-hours trading following the results, which matched market expectations. Loan-loss provisions and net charge-offs declined from the preceding quarter, helping the results.

The company, increasingly seen as a takeover target, reported a fourth-quarter loss of $67.1 million, or 4 cents per share, down from a loss of $275.6 million, or 50 cents per share, a year earlier.

Revenue rose 7.6 percent to $523.4 million.

The earnings were in line with what analysts expected on average, according to Thomson Reuters I/B/E/S. E*Trade's $231 million of revenue, excluding the provisions, was shy of the $245.8 million expected by analysts.

Daily average trading volume in the quarter fell 20 percent from last year, hurt by an earlier-than-usual holiday period trading slowdown as individual investors locked in profits from last year's sharp stock market rise.

Druskin said he expects 2010 customer trading levels similar to that in 2009, which was a record year even though trading volume dropped in the final quarter.

"They're going to be affected, like the other online brokers, by weak trading volumes," said Jason Ren, Chicago-based equity analyst at Morningstar. "But it does seem like they are turning the corner slowly but surely" based on the loan loss provisions, he added.

Larger rivals TD Ameritrade Holding Corp <AMTD.O> and Charles Schwab Corp<SCHW.O> last week reported steep quarterly profit drops that missed Wall Street expectations.

FORAY INTO REAL ESTATE

E*Trade is still suffering from a foray into the real estate market. Its banking unit ran up big mortgage-related losses in the last few years, overwhelming a healthy trading business.

The company's shares have fallen more than 90 percent since 2007 and slipped below $1 early last year, when the possibility of bankruptcy loomed.

Under regulatory pressure, E*Trade has aggressively raised capital with the backing of major stakeholder Citadel Investment Group and is starting to recover.

The company's shares were up 3 cents at $1.68 in after-hours trading. The stock closed up 1.8 percent in regular trading ahead of the results announcement.

Loans in E*Trade's home equity portfolio that are 30 to 89 days delinquent -- the company's greatest exposure to loan losses -- fell 9 percent from the preceding quarter.

The company set aside $292 million for loan losses and logged $324 million in charge-offs, both lower than in the preceding quarter.

E*Trade last month named Druskin, a director, as chairman and interim CEO, replacing Donald Layton, who stepped down as CEO at the end of 2009. Druskin told analysts and media on the call the new CEO would ideally serve for more than two years.

Looking ahead, E*Trade said it expects to divest its money-losing UK and Nordic local trading operations in the first half of this year, and record about $15 million of related charges. The move was expected after the company announced an international restructuring last month.

Management said it expects operating expenses to decline modestly this year.

Wall Street Group Starts Backlash Against Industry Backlash

Matt Townsend, Bloomberg, January 27, 2010

Wall Street has someone starting a backlash against the backlash.

“Obama started a war against Wall Street. Enough is enough,” Thomas Belesis (Above), chief executive officer John Thomas Financial Inc., said today in announcing the founding of RestoreWallStreet.com. The group’s main goal, according to Belesis: Get the Obama administration to “tone down” its rhetoric against financial institutions.

Wall Street firms including Goldman Sachs Group Inc. have been under attack from President Barack Obama, lawmakers and commentators for bankers’ role in the credit crisis and bonuses being paid this year. Obama has denounced “fat-cat bankers” and has called bank bonuses “obscene.”

“An icon of our democracy is Wall Street, long-admired and envied throughout the world,” Belesis, 35, said at a news conference to an audience of mostly John Thomas employees and about a dozen local media members on the trading floor of the retail brokerage. “We can and will forge a new and better day for ourselves and everyone around the world.”

Belesis, who said he is a Republican and voted for Arizona Senator John McCain for president, declined to say how many members RestoreWallStreet.com has and didn’t provide details on the group’s plans. He said that in coming weeks he’ll announce the names of Wall Street firms supporting the group.

In addition to overseeing 150 traders at his firm across the street from the New York Stock Exchange, Belesis has another role. He plays an executive in “Wall Street 2,” the sequel to Oliver Stone’s 1987 “Wall Street” movie.