Just a quick stop by today in the middle of a very busy week in the office. I didn't want the inter-web to think that I had forgotten about it though, I hear it can be very jealous.
I had a meeting with a Goldman Sachs product-rep yesterday (this is to be distinguished from a salesperson because a product guy has generally actually traded something in his lifetime). This particular guy was an ex-CBOT runner from the same era as me, small-worldness between two average looking white dudes who both went to college and work in finance isn't really surprising -- but gee-golly it's still fun. In any event, he was out to explain that Goldman's latest and greatest product innovation was a swap agreement tied to the forward curve for Euro Stoxx 50 dividends (as in swaps around say, the level of 2012 dividends). This market exists because options trade ex-dividends (generally) which means that options portfolios that use equity baskets to hedge their delta end up sticking Goldman with the short dividend risk on the physical equities (yeeeeah, I know, sorry I'm a huge finance nerd). Anyway, I just found it staggering that product innovation continues to be like this, absolutely crazy. More surprising, he told me that he's gotten a few endowments and foundations to actually get long the dividend forward swap. Goldman can sell anything! I actually liked this guy, no bullshit, very smart, straight-forward about the real risks of either side of the trade (and the real reason that GS is incentivized to dump this risk from their execution desks). I know no one will find this interesting... maybe Boondock.
More common fare, Haiku part trois:
Lazard Freres
No balance sheet here,
just a direct line to the
president. Not bad.
Goldman Sachs
All respect was lost,
the day I found out that you
hired Jim Cramer.
Raymond James
Oh Ray-J how cute.
You built your HQ down in
Florida? Too much.
Bank of America
Southern bankers meet
New York traders. I think
we know how that ends.
Back when I was first out of undergrad and spending far too much time with investment bankers in mid-town (they found me a novelty, hedge fund guy straight out of a mid-tier public university) we used to have a lot of fun using firm names as verbs/adjectives.
If a guy was being secretive or obtuse about whether or not he was dating girl A or girl B he was Lazard'ing us. If he was trying to date a girl that was way out of his league he was Bank of America'ing the date. If he was so over-served that he had issues telling the cab driver what the cross streets of his apartment were he was Mr. James, and he'd be mocked for forgetting which dock in Tampa he left his sail-boat at. If he had fallen asleep at the bar and was being preyed upon by a girl eight years his senior he was Stifel. These remain useful short-hands.
Word,
-I Heart Palindromes
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