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Saturday, September 27, 2008

Ctrl BG: A Shortcut to Financial News 9/28

Since I enjoyed writing the last post so much, I've decided to continue to do so. It has proven to be a great way to help me put everything into perspective and it's been fascinating reading what everyone else thinks as well. Again, feel free to correct me and put in your two cents, as obviously, I am no expert. I'm just a girl who happens to be interested in the current state of the economy.

Last Sunday night, Goldman Sachs (GS) and Morgan Stanley (MS) were approved by the Fed to become bank holding firms, officially ending the era of the independent investment banking model on Wall Street. They will now be able to open their own commercial banking arms and take in deposits, which they can then use to back up their investment banking operations- as JP Morgan, Bank of America (BofA) etc already does- thus ending investor concerns about the sustainability of their business model model. They now also have permanent access to borrow federal money (instead of within the window temporarily opened for them) and can become a FDIC insured bank, which insures indivisuals up to $100,000 of bank deposits. The following day, MS announced that they were getting as much as $8.5 billion of cash injection from Japan's Mitsubishi UFJ Financial Group (MUFG) in exchange for up to 20% equity stake in MS, further fortifying their position. I guess the deal with China fell through (or were the Chinese getting too greedy and the US govt didn't like that?). This is probably a better move anyway, since MUFG is the world's No. 2 bank by deposits, so surely it will help MS's transition into commercial banking go more smoothly. MS apparently already has about $36 billion in bank deposits from their private wealth management (PWM) business and are looking to expand into Asia. Or so, that's what CNBC said, but I didn't know PWM deposits count as bank deposits, but if they do, I guess this means that MS are looking to expand their PWM business in Asia. Or perhaps this $36 billion comes from their Utah-base industrial bank, which will be converting into a national banking association, names the Morgan Stanley Bank, National Association? Goldman Sachs' approach is must easier to understand (or so I think). They currently already have two deposit taking subsidiaries, with about $20 billion in deposits, and plan to create a new one called GS Bank USA, that will have more than $150 billion of assets.

This conversion is not all good and dandy though. Becoming a bank holding also puts both banks under more intense scrutiny and regulations from the Fed, which will probably limit their proprietary trading capacities (the division where they trade company assets like a hedge fund, taking on great risks), which happens to be one of their most lucrative divisions. I don't know about MS but personally I'm feeling quite optimistic about GS. On Tuesday, Warren Buffet invested $5 billion in GS preferred stocks and will also recieved warrants to purchase another $5 billion in common stock within the next 5 years- effectively give him about a 10% stake in GS. They also raised another $5 billion from a public stock offering, all within a few days. This and Buffet's approval, which in the investment world is the equivalent of getting Anna Wintour's approval in the fashion world, make me quite optimistic. Besides, I have always had great confidence in the power of brand image, Buffet just likes to call it "franchise."

On Thursday, Washington Mutual (WaMu), was seized by the FDIC, making it the biggest banking failure ever. Within 9 days, customers withdrew about $16.7 million in deposits from WaMu, literally breaking the bank. JP Morgan picked up WaMu's banking assets for only $1.9 billion. JP has had its eye on WaMu's operations in CA and FL for a while, and had offered for them in March, but was rejected in favor of a capital injection from TPG private equity (whoops!). It seems like JP got yet another bargain. JP is not the only one who got a sweet deal in all this however. It appears that Mr. Alan Fishman, WaMu's CEO for only 2 weeks, is eligible for $11.6 million in cash severance AND get's to keep his $7.5 million signing bonus. Not bad for two weeks worth of work.

It seems that the financial tsunami is expanding abroad too. Fortis,
the largest Belgian financial-services firm, just received an $11.2 billion euro bailout from Belgium, the Netherlands and Luxembourg in exchange for 49% stakes in the Fortis in their respective countries. It's almost like the European version of AIG.

The next bank on the chopping block is Wachovia- funny since a week ago they were in talks to merge with MS. Citigroup and Wells Fargo are currently in a bidding war over a possible emergency takeover of Wachovia, since it's stocks dropped dramatically on Friday.

While all this was going on, politicians were hard at "work" trying to get the $700 billion bailout bill to pass Congress. I'm not that into politics, but even I tuned in Wednesday morning to hear Paulson and Bernanke defend their case to the people at Congress. I'm not sure how politics usually go, but to my untrained ears, it sounded like a verbal merry-go-around, placing blames and trying to trick each other into saying something wrong. A members ask a simple yes/no question, Paulson/Bernanke would answer in a very roundabout way which prompts the member to ask, "so was that a yes or a no?" to which they'd repeat what they'd just said again. This would go on until the time is up or someone finally gives up from the frustration of it all. No wonder it takes them months to get a bill to past.
I'd imagined it to be more diplomatic and sophisticated. Anyway, I think the gist was that people didn't think taxpayers should have to bailout Wall Street (and individual homeowners) for taking too on stupid risks. But they had to do something. So they moved onto putting clauses on the plan, for oversight to monitor the use of the money, a cap on CEO pays and for warrants in companies who will be using this plan, so taxpayers would at least get something back for the $700 billion they spent. There was a gliche, when a bunch of Republicans rejected the plan and proposed some other plan to privately insure mortgage backed securities (there was shouting involved!), but it sounds like they're back on track now and a bill will be voted on Monday.

Personally I don't know what to think about this bill. On one hand, I don't think tax payers should have to bail out people who took on unnecessary stupid risks and expect everyone else to wipe up their mess when things go down just because the mess is big enough. As if our future generations didn't already have a big enough debt to clear up already, with the war and the social security problem etc. but now we have this. On the other hand, just like a bad trend, someone has to step in and put a stop to it before it spreads through the population. With the newly added clauses, it's the next best step there is. By taking the distressed debts out of "weak" hands and into "strong" hands, they might even make money in the future when the housing prices go back up! Besides, if the likes of Paulson, Bernanke and Buffet, says this is a sound plan, who am I to gainsay the experts?

Friday, September 26, 2008

Phuket Thailand wallpaper

Friday Video Fun!!

Here's a video for your rainy Friday:

Have great weekends!

Mail Bombs: Rihanna's Glam Punk Look + Black Booties!

It's a rainy, fall friday. Booooooo!
Hopefully these Mail Bombs will lift your spirits!
First Edonna says, "I love the shoes that Sanaa is wearing!"
"...Can you please assist???"
Sanaa is wearing the look of the season: open toe boots. Try these for a similar look:
1. Jeffrey Campbell Half Boot with Open Toe, $190. 2. L.A.M.B. Portman Open Toe Bootie, $320. 3. Kors Michael Kors Open Toe Ankle Bootie, $320. 4. Steven by Steve Madden Midory Ankle Boot, $150.
Next Fattina says, "Can you PLEASE let me know who designed the studded booties that Kim Kardashian wore while shopping at H&M?"
Kim might like affordable fashion, but she loves expensive shoes! She's rocking these $1,075 Guiseppe Zanotti Crystal Stud Suede Booties...
...get 'em from Intermix.
Mona Lisa says, "I really do love the “Glam Punk Rock”look (which Rihanna pulls off very well)..."
"...I want to give it a try but I don’t know where to begin! Can you help me??"
Adriana says, "What's great about the glam rock look is that it's easy to piece together with a few basic things (boots, graphic tees, skinny jeans) that are probably sitting in your closet right now. Here's a head-to-toe look that's fall-ready, easy to mix and match with other pieces in your wardrobe, and just a fraction of the cost of what Rihanna probably spends:"
1. Sequined Vest from Forever 21, $16. 2. MTV Zebra T from Delia's, $26.50. 3. Leather Cuff Bracelet from Urban Outfitters, $20. 4.Marciano Liquid Skinny Pant, $128. 5. Steve Madden Grind Boots in Black Suede, $200. 6. Axcess Medallion Necklace, $13.
In another Rihanna Mail Bomb, Kimmoy says, "I know people are probably tired of seeing Rihanna, but this fall look is fabulous!"
"How can I look as fly, but not hurt the pocket like Rihanna in this red, white, and black number?"
Adriana found these fall ready yet affordable items:
1.525 America High-Collar Long Military Jacket, $118.50. 2. Gap Wool-blend Shirred Yoke Skirt, $36.99. 3. Forever 21 Checker Plaid Scarf, $6.50. 4. Forever 21 Gradated Sunglasses, $6.80. 5. Old Navy Women's Opaque Black Tights, $6.50
Lastly, in a Male Mail Bomb Ololade says, "I wanted to know where I could get Gold Rope chains like the ones Nas has been rocking lately..."
Adriana found that Patricia Field has what you need! Get this Dookie Rope Chain for $120...
With that I'm off!
Try to stay dry this weekend!

Rihanna to Launch her own Clothing Line

In even more Rihanna news, seems the material girl is launching her own clothing line...
She told WWD in Milan, "I’m not one to rush into anything. I want to take my time...I can’t say when it will be released, but it’s definitely going to happen." Hmh. There's a big line between knowing how to wear designer clothes well and making your own. I'll have to see how I feel about this one. Would you wear Rihanna's label? [WWD]

Do you Rock for Barack?

Don't forget to send in pix of you rocking for Barack!
Send your political and fashion statements to

Safes through the ages in Sibu

The first safe I remember seeing was the one in Hua Hong Ice Factory and my father had the key to it and so did the accountant. It was very old and worn out as it was probably first bought in the 1910's. The next safe I saw was the one in Hock Hua Bank when it was first started. It was newer and prettier. There might have been another vault but it must have been very well hidden.

Ever since I was a child I learned well that money was very important and that the Foochow men would work very hard for their money. They loved their money. I saw a lot of money changed hands in Chop Ching Cheong and the shop had two safes. But what was even more important was who held the key to the safe.

Another safe that was quite obvious to the public was the one in the Dentist Tiong Teck King's clinic. It is still there today. This safe must have seen tons of cash at the prime of its life.

I suppose during those days it was okay to have the safe seen by customers and relatives. After all it was a strong box and no one could break into it.

The Google Images supply me with these images:

This is a safe you can find in most hotels and perhaps even in some homes.

This is a fairly old safe but still in used by many.

Chubb is a famous name for safe. And at the present moment they make some of the biggest safes in the world.


This is the safe in Dentist Tiong Teck King's Clinic in Sibu in Channel Road. I took the photo a few months ago. It is old but still very sturdy and most probably it can still be used.

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I remember my grandfather having a very old safe and he would gently open the safe to check his cash and other personal items. He would carefully keep his many keys on his body. I suppose he never left them around . I have never seen him being careless with his own personal things. He was a very meticulous man. All certificates land titles and gold items of course were kept in the safe by most of the men who owned safes. It was their filing system in the olden days.

After he passed away and my grandmother moved to her new house we do not know what happened to that safe. Perhaps it was kept by grandmother at the back of one of her rooms. She was also a person who kept things well as she was a very neat and tidy person.

Do we still need a personal safe today?

Puma Partners with Sergio Rossi

Puma is partnering with Sergio Rossi to create a collection...
WWD reports, “A design team at Sergio Rossi reinterpreted Puma's iconic Clyde sneaker, which originally made its debut in 1973, including a high-heeled mary jane model with Velcro straps and a lace-up pump in a range of colors.” Um, pass. [WWD]
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