World economy talk

[Monseratto]

More info on the UBS rogue trader...

'I need a miracle': Desperate last Facebook message of banker accused of £1.3bn fraud

-Privately educated Kweku Adoboli was a 'work-hard play-hard' trader
-Entertained a string of attractive women at his luxury flat in East London
-Neighbours complain over Ghanaian trader's frantic party lifestyle
-Shares in Swiss bank UBS slump 10% following the scandal
-Adoboli's boss 'quits' as questions surface over his supervision of staff

A suspected rogue trader accused of a staggering £1.3billion fraud told friends he needed ‘a miracle’ days before he was arrested.

Kweku Adoboli, 31, posted a desperate last message on Facebook as he tried to recover enormous losses he had run up through illegal trading.

Detectives detained Adoboli, who works for Swiss banking giant UBS, during a 3.30am raid yesterday at his luxury London flat.

The Ghanaian, who was privately educated in Britain and is the son of a retired UN worker, is accused of being responsible for the biggest loss ever accrued by a single trader based in London.

The £1.3billion figure easily dwarfs the £827million lost by rogue trader Nick Leeson, the man behind the collapse of Barings bank in 1995.

It equates to about the same amount UBS is seeking to save by cutting 3,500 jobs worldwide.

Speculation was mounting that he may have been caught out after the Swiss Central Bank unexpectedly devalued the franc last week, producing mammoth losses on one of his currency trades.

Mr Adoboli worked in the European equities division of UBS, focusing in particular on exchange-traded funds, according to his profile on Linked-In.

He worked on the Delta One desk, a trading unit that executes relatively low-risk trades usually using computer algorithms. Kerveil also worked on a Delta One desk.

Mr Adoboli lived in a 1,000-a-week loft apartment in the trendy London suburb of Shoreditch for several years before moving out about four-and-a-half months ago. The area is near London's Brick Lane, a busy street of curry houses, bars and vintage fashion shops only a few blocks from UBS's UK headquarters.

His former landlord, Philip Octave, said he was a well-dressed quiet man of African origin who "was not the tidiest" of people but very well spoken.

He fell behind in the rent twice but always paid up in the end, he said.

He said he asked him to move out so he could refurbish the apartment. "He was not a party chap," he said. "I found no problems."

Mr Adoboli joined UBS about two months after graduating from Nottingham University, in England, in July 2003 with a degree in e-commerce and digital business.

Before university, Mr Adoboli attended a Quaker boarding school located in West Yorkshire, England.

Sources said he earned around £200,000 a year, plus up to £400,000 more in bonuses.

Kweku Adoboli: UBS trader arrested in London after running up £1.3bn losses | Mail Online

[uls]

i think hindi currency trading loss yan eh

Delta1 doesnt involve currency trading

[tidus1203]

UBS might totally get out of investment banking and concentrate on their bread and butter which is PRIVATE BANKING!

[qupte](Reuters) - Swiss bank UBS is expected to shrink its investment bank business -- source of a $2 billion rogue trading loss -- and could fire senior executives as it tries to retain worried private clients and avert a ratings downgrade.

Analysts said the massive loss, announced on Thursday, was the final nail in the coffin for UBS' investment bank which has struggled, like others in the industry, against falling markets and tough new regulation as well as the soaring Swiss franc.[/quote]

UBS $2 billion loss to trigger investment bank retreat | Reuters

[tidus1203]

UBS might totally get out of investment banking and concentrate on their bread and butter which is PRIVATE BANKING!

(Reuters) - Swiss bank UBS is expected to shrink its investment bank business -- source of a $2 billion rogue trading loss -- and could fire senior executives as it tries to retain worried private clients and avert a ratings downgrade.

Analysts said the massive loss, announced on Thursday, was the final nail in the coffin for UBS' investment bank which has struggled, like others in the industry, against falling markets and tough new regulation as well as the soaring Swiss franc.

UBS $2 billion loss to trigger investment bank retreat | Reuters

[eld]

Maganda yan. Anything that can bring down the cowardly Swiss is fine by moi.

[Ry_Tower]

Jobs protests mount as EU chews on US-eurozone fallout - Yahoo!7

hehe, lalong nagkagulo.

[leonleon]

SIGNS of the (depressing) times indeed:

Spain raises taxes on the rich | Business | The Guardian

Prime minister José Luis Rodríguez Zapatero reinstates the sort of wealth tax that he abolished just before the recession

Spain today became the latest European country to hike taxes on the wealthy, with a new asset-based tax targeting the country's richest people.

The move represents a U-turn for prime minister José Luis Rodríguez Zapatero, who abolished a similar wealth tax in 2008 — just before the country plunged towards recession.

[eld]

RIP Spain. Rejoice!!!

[uls]

Obama also wants the rich to pay more tax

Sept 18, 2011

[ame]www.youtube.com/watch?v=oSL_GIVoEFg[/ame]

[uls]

as Greece waits for the final installment of bailout 1.0 in Oct, the EU is beginning to consider sovereign default scenario

instead of bailing out sovereigns, the EU will use the EFSF to directly bailout banks

that's the direction i think they're headed

[uls]

UBS press release

UBS - Investor releases

Zurich/Basel, September 18, 2011, 04:00 PM
UBS provides more detailed information on unauthorized trading

On September 15, 2011 UBS announced that it had discovered unauthorized trading in its Investment Bank. This trading was conducted by a trader in its Global Synthetic Equity business in London. The trader in question has been charged by UK authorities with fraud by abuse of position.

Before making a further announcement, we needed to be certain that we understood the positions that were booked and that we knew the amount of our resulting loss.

We have now covered the risk resulting from the unauthorized trading, and the equities business is again operating normally within its previously defined risk limits. The loss arising from this matter is USD 2.3 billion. As previously stated, no client positions were affected.

The loss resulted from unauthorized speculative trading in various S&P 500, DAX, and EuroStoxx index futures over the last three months. The positions taken were within the normal business flow of a large global equity trading house as part of a properly hedged portfolio. However, the true magnitude of the risk exposure was distorted because the positions had been offset in our systems with fictitious, forward-settling, cash ETF positions, allegedly executed by the trader. These fictitious trades concealed the fact that the index futures trades violated UBS's risk limits.

Following inquiries directed to him by UBS control functions that were reviewing his positions, the trader revealed his unauthorized activity on September 14, 2011.

UBS's Board of Directors has set up a special committee to conduct an independent investigation of the unauthorized trading activities and their relation to the control environment. The committee will be chaired by David Sidwell, the Senior Independent Director, and will report to the Board of Directors. The other members of the committee are Ann Godbehere and Joseph Yam.

UBS AG

Media contact
Switzerland: +41-44-234-85 00
UK: +44-207-567 47 14
Americas: +1-212-882 58 57
APAC: +852-297-1 82 00

[Ry_Tower]

UBS press release

UBS - Investor releases

Parang napabayaan at biglang ganyan kalaki ang loss. La ba nag-aaudit dyan sa kanya?

[eld]

I think this is all for show.

[uls]

Parang napabayaan at biglang ganyan kalaki ang loss. La ba nag-aaudit dyan sa kanya?

they are supposed to be people tracking what traders are doing

don't know what went wrong. poor risk management

from what i understand, the trader placed bets but didnt hedge (traders are supposed to hedge positions)

he created fake hedges (dont know how he did it) so his positions were totally exposed

[uls]

FOMC meeting tuesday and wednesday

what will they announce on wednesday?

probably...

the Fed will stop paying interest on excess reserves

the Fed will buy long-term US treasuries and sell short-term US treasuries

[Monseratto]

[uls]

S&P downgraded Italy

[Ry_Tower]

they are supposed to be people tracking what traders are doing

don't know what went wrong. poor risk management

from what i understand, the trader placed bets but didnt hedge (traders are supposed to hedge positions)

he created fake hedges (dont know how he did it) so his positions were totally exposed

I guess that's what gonna happen if you think you know it all and you're the king of the world

or

he's just plain unscrupulous

[uls]

FT report German company Siemens withdrew over half a billion euros from French banks

deposit directly at the ECB

report says Siemens has 4 to 6 billion euros at the ECB

[Monseratto]

Desperate times call for desperate measures...


100,000 Greek workers face axe to save nation - Scotsman.com News

The Greek government has been warned it must forge ahead with hardline spending cuts to secure the crucial next tranche of its international bail out funding.

The country is facing demands to sack 100,000 public sector workers - 20,000 more than anticipated - to curb its massive borrowing levels.

But the Greek government has claimed that the country is being "blackmailed and humiliated" as it struggles to get a grip on the crisis.