Are rising costs and regulations detering public equity sales?

Short Version: more firms are choosing to sell public equity in Europe than in US. Is it because of increased regulations? Maybe. No doubt they play a role.Bloomberg.com: Exclusive: "Fees in Europe range from 1 percent ...5.4 percent... Underwriting fees for more than half of the deals in Europe are undisclosed...By comparison, 71 of the 111 initial stock sales on U.S. exchanges this year

PMI vs PiggyBacking

Another financing option lures home buyers: PMI - OregonLive.com: "Home buyers who can't come up with a 20-percent down payment -- and at today's real estate prices it can be a stretch -- must buy private mortgage insurance, or PMI, to guarantee that the lender will be reimbursed if the buyer defaults on the loan.But in recent years, buyers have been circumventing the requirement by paying less

How much can you expect to make on Wall Street?

Wall Street Ren - Career: "Trader Monthly/Options Group2006 Wall Street Bonus Survey"Thanks to Anonymous! (S)he left a comment with this link and it was too interesting not to highlight!

Breaking the Silence on Finance - New York Times

Breaking the Silence on Finance - New York Times"People talk about their sex life and their kids and you can open up and share about your past and mistakes you’ve made, and that’s always a catharsis and is emotionally and spiritually freeing,”... “But people don’t want to talk about their money.”What are we afraid of? One concern is that we will be branded failures. When we were living in caves,

Goldman and the NASDAQ plan "private" markets

First the news: Goldman Sachs the latest to offer unregistered trades - May. 24, 2007:"Top IPO underwriter Goldman Sachs Group Inc. this week launched a platform allowing an exclusive club of big investors to trade unregistered, privately placed securities, in the latest challenge to U.S. equity markets.Private placements have become a big deal on Wall Street, another alternative for companies

Update on some things we covered in class

Updates on Home Depot, Adelphia, and the XM/Sirius potential merger:* Home Depot had their annual meeting and it was quite a change from last year's! The new CEO made a point to be more open! From the NY Times: "Frank Blake confronted the past, saying he regretted last year’s now infamous annual meeting, when members of the board stayed home and his predecessor, Robert L. Nardelli, refused to

Ideoblog: The first exchange-listed law firm

I guess more note revamping is in the works. From Ideoblog: The first exchange-listed law firm: "Slater & Gordon Ltd . . . became the first law firm in the world to list on a stock exchange on Monday. Already the firm's principals along with initial investors have booked a princely premium with the stock closing at $1.40, after gaining 40 cents on the initial public offer (IPO) price."Law firms

Corporate Governance Blog: International Poison Pills

Stephen Deane at the Corporate Governance Blog has a very interesting article on the growing use of poison pills (not that kind!) in Japan and France. Institutional Shareholder Services -- Corporate Governance Blog: ISS Releases New Report on Poison Pills in Japan, U.S., Canada and FranceSubmitted by: Stephen Deane, Director, ISS Center for Corporate Governance: "Even as takeover barriers are

What's going on? A look around

I should be working on a paper (have three in various stages but am sick of all three, so a quick update on things and a look around (much like the old newsletter).The Blogging World and other NewsIn the most important blog article of the week, at the Financial Rounds the UnknownProfessor announced the good news on his son who is cancer free! Less important he also has a really cool group of

Some summer reading

With the end of classes, comes summer reading/ristening. So I figured I would share some of those books either started (I generally have 4 or 5 going at once.)A Guide to Equity Index Construction by Daniel Broby. Good stuff. Will definitely be used in class next semester!A Behavioral Approach to Asset Pricing by Harsh Shefrin. This one has been on by "to-read" list for a while. teaching SIMM

Rules change, behaviors change: a NASCAR example

People maximize their own utility and react to rules changes. This simple idea (which really is core to all of economics and finance) is the foundation of every class I teach. So when I get a chance to show this simple idea in practice I am always excited. So much so I can't wait to finish the paper to show you some results.Following the 2003 NASCAR season, officials changed the rules and

I did not know that...

While most of us know what a mutual fund is, FundSavvy does have a col site and some interesting facts that I sure did not know, for instance on their What are Mutual Funds? page:"The popularity of mutual funds may be relatively new but not their origin which dates back to 18th century. Holland saw the origination of mutual funds in 1774 as investment trusts before spreading to Anglo-Saxon

Marketplace: China loosens control on currency — a bit

Baby steps are better than no steps!Marketplace: China loosens control on currency — a bit: "Starting Monday, China will allow its currency to rise or fall 0.5% a day. The limit used to be 0.3%"

Why have investment banks been so profitable? From the Economist

The Economist gives us another great article! This one is on investment banking. Not only does it provide a short history (going back pre-JP Morgan), but also brings us up to date with a look at the current (very profitable) state of investment banking.The alchemists of finance | Economist.com:A relatively long look-in:"Brokerage used to be described as a haulage business, lugging money, as a

SSRN-A Unified Theory of Ten Financial Puzzles by Xavier Gabaix

Just found this while reading through papers for the upcoming Texas Finance Festival and found this by Gabaix (he of larger firms = more CEO pay fame). His new paper is really interesting, a tad challenging, and nothing if not ambitious!In it this important paper potentially explains "a host of puzzles." How big is a host? About 10 accoring to the paper.A portion of the abstract:SSRN-A Unified

NPR : Q&A: The World Bank at a Crossroads

NPR : Q&A: The World Bank at a Crossroads: "The World Bank was founded in 1944, charged with the monumental task of eradicating global poverty. It offers loans to countries that might not otherwise get them. Since its inception, the bank has lent or given $400 billion.Yet critics say the World Bank is a bloated, corrupt organization that has outlived its usefulness."While not ground breaking,

SSRN-The Economics of Islamic Finance and Securitization by Andreas Jobst

SSRN-The Economics of Islamic Finance and Securitization by Andreas Jobst: "Islamic lending transactions are governed by the precepts of the shariah, which bans interest and stipulates that income must be derived as return from entrepreneurial investment. Since Islamic finance is predicated on asset backing and specific credit participation in identified business risk, structuring

Chrysler deal: Cerberus CEO puts value on privacy - USATODAY.com

Chrysler deal: Cerberus CEO puts value on privacy - USATODAY.com: "In Greek mythology, Cerberus is the three-headed hound that guards the entrance to Hades. But in the early 1990s, Cerberus was more like a junkyard dog, buying the debt of troubled companies, taking control and improving their operations.As Cerberus grew and became more interested in larger companies, Feinberg hired prominent

The Green Children Foundation

I just stumbled upon this on YouTube. The video, while too short, is pretty good. :)"Last year, The Green Children shot a music video in Bangladesh to celebrate the work of Professor Muhammad Yunus, the father of microcredit and founder of The Grameen Bank"The Green Children Foundation: "We believe in the ability of the poor. With the use small loans (microcredit) people all around the world

A look back to the 1987 Stock Market Crash

Almost 20 years ago the stock market lost over 20% in the course of a single day and about 30% over a two week period. Now the Fed's Mark Carlson looks back at the crash in a fascinating history piece.A Brief History of the 1987 Stock Market CrashA quick look in:"The market crash of 1987 is a significant event not just because of the swiftness and severity of the market decline, but also because

Are people really this clueless?

The Buffalo News: Business: "Most Americans — regardless of gender — lack the basics they need to accumulate the money that will be essential for retirement, but more women than men are missing some of the nuts and bolts, according to research by Dartmouth College professor Annamaria Lusardi.In surveys of individuals she found that only 55 percent of workers knew that government bonds provide a

Open-Source vs. Microsoft

Microsoft claims software like Linux violates its patents - May 28, 2007: "...there's a shadow hanging over Linux and other free software, and it's being cast by Microsoft (Charts, Fortune 500). The Redmond behemoth asserts that one reason free software is of such high quality is that it violates more than 200 of Microsoft's patents. And as a mature company facing unfavorable market trends and

SBU's Students in Money Management

WIth Steve Horan gone from SBU, I am taking this under my wings. Which is to say short sell now! But seriously, it will continue to be run by the students. I figured some of you might be interested in the new web site.Students in Money Management: "The St. Bonaventure University Students in Money Management Fund (the Fund) seeks to offer undergraduate students the opportunity to participate in

alfred Chandler

True he was not a finance professor, but he did study the history of finance and helped establish the importance of looking at business history. Harvard's Alfred Chandler dead at 88: "Alfred D. Chandler, Jr., the renowned Pulitzer Prize-winning Harvard Business School historian who founded the field of business history, died on Wednesday, May 9, at Youville Hospital in Cambridge, Mass., at the

An exclusive conversation with Warren Buffett - Charlie Rose

An exclusive conversation with Warren Buffett - Charlie RoseIt doesn't get much more interesting than listening to Buffett talk.

Where are the shareholders' mansions? CEOs' home purchases, stock sales, and subsequent company performance - Knowledge@W. P. Carey

Short version: bigger house, smaller returns.The "why" may still out there, but interesting finding! Where are the shareholders' mansions? CEOs' home purchases, stock sales, and subsequent company performance - Knowledge@W. P. Carey: "In a new study, W. P. Carey finance professor Crocker Liu, director of the school's Center for Real Estate Theory and Practice, and David Yermack, professor of

Assistant professor of Finance at Simon School and still in teens?

From the Australian: "TWO Russian-born sisters are due to become assistant professors of finance in New York later this year, at the tender ages of 19 and 21, university officials said.Angela Kniazeva and her younger sister Diana were due to take up their new positions in September at the University of Rochester, where half of their students will likely be older than them.The pair, who already

Buffett: Index funds better for most investors | Reuters

Buffett: Index funds better for most investors | Reuters: "Warren Buffett said on Sunday most investors are better off putting their money in low-cost index funds, though he believes he can still outperform major market indexes.'A very low-cost index is going to beat a majority of the amateur-managed money or professionally-managed money,' Buffett said at a press conference, a day after the

Interesting stat on Dow

CNNMoney.com Market Report - May. 4, 2007: "The Dow has now risen in 23 of the last 26 sessions, marking its longest bull run since the summer of 1927, when the indicator ended higher in 24 of 27 sessions, according to Dow Jones."

Congratulations Eric Lie!

press-citizen.com | Local News: "University of Iowa finance professor Erik Lie has been named one of the world's most influential people by Time magazine....In the overall list, Lie is included with other notables that include Oprah Winfrey, George Clooney, Roger Federer, Tony Dungy, Nancy Pelosi, Hillary Clinton, John Roberts, Pope Benedict XVI, Al Gore, Elizabeth Edwards, Condolezza Rice and

Chavez threatens to nationalize banks, steel producer

He just does not get it. And he wonders why the economy is so messed up!globeandmail.com: Chavez threatens to nationalize banks, steel producer: "Venezuelan President Hugo Chavez on Thursday threatened to nationalize the country's banks and largest steel producer, accusing them of unscrupulous practices.“Private banks have to give priority to financing the industrial sectors of Venezuela at low

Three Quick sports stories

Three sports stories of this week definitely had some overlap to business, economics, and Finance.a. The first round of the NFL draft was the longest (measure by time) in history. Many announcers and reporters mentioned it but none (that I saw at least) correctly explained why-- you do not exercise an option early. Why? Consider the following. Suppose you are drafting 12th and have your heart

National Bankrutpcy debate?

Want to start a debate? Bring up the idea of national bankruptcy.For instance James Kazoun writes over at ArabicNew.com thatIraq and Lebanon should declare bankruptcy: "I am not aware of any such bankruptcy laws for countries, but there should be one as well. But in such absence, setting precedence should do it. Now that Iraq supposedly have a democratic government, this government should

Cheating at Duke

As a reminder to everyone doing finals, DON'T CHEAT!!From Business Week:"....school officials said that Duke is taking disciplinary action against 34 of the school's first-year MBA students—almost 10% of the school's 2008 class—for allegedly cheating on an open-book, take-home final in one of the school's required core classes. It is the largest episode of cheating in the school's history,