Daily Archives: March 20, 2009
$57 billion in assets, it’s all ours now. Of course, so are the liabilities which I assume exceed those assets.
The affected institutions don’t serve the general public. They provide critical financing, check clearing and other tasks for the retail institutions. These wholesale credit unions, known in industry parlance as corporate credit unions, are owned by their retail credit-union members.
The vast majority of regular credit unions, the bank-like cooperatives familiar to millions of account holders nationwide, are considered financially sound. Credit unions have more than 90 million members nationwide.
U.S. Central and Western Corporate have been grappling for more than a year with large paper losses on a slew of assets, mostly mortgage related. In January, regulators moved to prop up U.S. Central with a $1 billion infusion after it took big write-downs on some of the securities.
Mr. Fryzel said regulators acted Friday after becoming convinced that the two institutions were underestimating the true scope of their losses. “With us in control we’d get honest numbers,” he said. Mr. Fryzel said regulators plan to replace top management at both institutions.
We saw two single family houses, each under a million, go to contract this week. That makes 30 contracts for the year, which may not be cause for celebration. Last year, when we thought the market was dying, there were 93 contracts during the same period (January 1- March 20) and in 2007, when bonuses still flowed, we saw 164.
Oh well, there’s always next week.
Good heavens, here’s a blog by a person who worked for the Noels for eleven years. Journalists looking for facts on our temporarily most famous family, meet fellow journalist Sherry Shameer Cohen. Her blog’s here, and here’s one posting:
The people who pretend to be in the know about the Noels have omitted important facts in their blogs and articles, including the one in the current issue of Vanity Fair:First, one of Fairfield Greenwich Group’s original partners, Fred Kolber, has yet to be mentioned. Fred was there for the first few years because it was his trading strategy that inspired Walter Noel to start an off-shore fund. Madoff came into the picture later. Although Fred had nothing to do with Sentry, he should be a source for those who are serious about writing the Madoff story. He knew Jeff Tucker very, very well. By coincidence, Fred and Jeff share a middle name — Harvey.
Second, Corina Noel Piedrahita worked for her father and with her husband at Fairfield Greenwich Group until she stepped down in 2007. She was involved in almost every administrative detail from setting up accounts, accepting wire transfers, arranging for commissions to be paid, establishing components in the weekly net asset values of the funds, and traveling back and forth between the firm’s headquarters (then based in Greenwich) and Citco in Tortola, where the off-shore funds were officially set up and administered. She was no passive stay-at-home mom, but an active member of FGG.
Third, Yemanja is the second Mustique home bought by the Noels. They bought Callaloo after renting it and Monica did extensive renovations and redecorating. Yemanja came later. The point is that Walter didn’t suddenly come into this lavish lifestyle while he was in his 60s and start buying luxury properties. He had the Park Avenue apartment, which the daughters used while they were single, and the house in Greenwich. The entire family loved Mustique. Alix and Philip were even married in Mustique by the Rev. Cuthbert Edwards, a United Methodist minister, at the Bamboo Church. The wedding, incidentally, was covered in detail by Town&Country.By coincidence, there’s an article in the current issue of Vanity Fair about Le Ponant, a small French cruise ship that was captured by pirates last spring. The Noels invited friends to join them on Le Ponant for a private cruise early in the ship’s history. Town&Country had a brief on it and included mention of the Noels. What was omitted from the piece in T&C is that the Noels made it clear in their invitation that people had to pay their own fare.
Because I’m simply awful about checking my voice mail (ok, I don’t do it, as a rule, because 99% of it is corporate nonsense) I missed a call of early March from a friend/reader who alerted me to what sounds like a great article. Apparently the New York Times ran a story on March 9, 1978 on Greenwich and called it, “Where house prices go up forever”. I don’t think it’s available in the public archives, although I’m going to look, but if someone has access to a better search machine, could you check? It sounds like fun. thanks.
UPDATE: Found it, by gum – The Times wants 4 bucks to access it but it’s free to home subscribers so when I get home I’ll dig up that account number and we can all read the whole thing.:
Where Home Prices Go Up Forever Is Heaven …; …And Where They Don’t Is Not Where Home Prices Go Up Forever Has to Be Heaven Foreclosures Amid Faltering Home Prices
By MICHAEL GOODWINBy DIANA SHAMAN
April 9, 1978, Sunday
Section: Real Estate, Page R1, 3855 words
GREENWICH, Conn.–Heaven. It is one of the words people in Greenwich, Conn., commonly use to describe their town.
Almost non-existent. We’re up to five single family houses going to contract for the month, which is awful. 80 Perkins Road, new construction by Jordan Saper, will close on Monday and the revelation of its selling price should be telling. Saper asked $7.950 million and in the past, a Saper house usually commanded close to full price. In the past. This time, I’m betting $6.5 high, $5 million, low. More on Monday.
There is another spec house closing next week, for an astonishing price. Can’t tell where or how much, now, but it’s going to be a lot of fun for some folks to laugh at, if they’re brave enough. I may set up another blog under a pseudonym and do just that.
The late Kit Wright’s Belle Haven home at 52 Pear Lane came up for sale today, listed for $16.5 million. It’s an acre and a half, direct waterfront with a deepwater dock (or so the listing says – I never looked), with a view more of Greenwich Harbor than Long Island Sound. It is a nifty cottage – as unique as its former owner – but I don’t know what the market is for a rambling little place that looks like an illustration from the times of Shakespeare. It was actually built in 1900, and the listing says it’s been “renovated at various times.” I suppose it has, although the last time I visited I saw no sign of renovations that I would have described as “recent”. Cool place though.
There was a neighbor, Egyptian I think, who lived in the original mansion for which this served as the gate house. He had a standing offer to Kit to buy the place back to restore the original grounds, but the fact that it’s being offered for sale would indicate that either he’s no longer there or interested or perhaps didn’t offer enough. In any event, his loss is your opportunity. Goldman boys need not apply, but maybe one of you hedge fund types described below in the Greenwich Avenue post as still having tons of money would like to jump in.
Lucinda Franks has an interesting interview with an ex-Madoff employee, up today on The Daily Beast. Creepy company, in many odd ways. But Bernie paid them huge salaries while the legitimate business lost money and no one wanted to leave such a sugar daddy. The most interesting question for the future is how much Mark and Andy Madoff knew. If their trading firm never made enough profit to pay them such huge salaries, how did they think they were getting paid? The employee Franks interviews says they all wondered how Bernie could be making 8-12% while they were lucky to be cranking out 3-4%. Wondered, but never asked. Were the boys onto the scam? This man thinks so:
Ruth was the firm’s bookkeeper: “But I only saw her walk through once or twice,” Some friends of the employee, in hindsight, have said that Andrew and Mark must have known or suspected that things were not kosher. “They were educated guys, one of them had gone to Wharton, I think. They saw the balance sheets. We were making no money, some years losing it, and the brothers, I heard, were getting $4 million annually. That just didn’t track.”
“But I don’t want to believe that they knew or were involved,” the employee said. “I believe they’re innocent. They were really nice guys, they looked very straight. They treated me well even though as a computer programmer, I didn’t command the respect the hotshot traders did. When I told them I wanted to leave, Andrew tried to persuade me to stay and when I declined, he let me work only four days a week so I could start up my computer business.
I hope Franks will divert some of her investigative energies into Walter Noel’s operations. The woman is a talented writer (well, that might explain her Pulitzer prize) and is great at digging. Maybe if I promise her a gold-plated shovel she’ll come out to Round Hill and ask around.
My favorite bit from the interview?
“We all joked that the motto of the place was that ‘it was good to work for Bernie.”
You bet. Tough luck if you invested with him, too.
Barny Frank, whoremaster of Georgetown, is pushing to ban all bonuses,any bonuses, being paid to any employee of a company that’s received TARP money. He also wants Congressional oversight over all salaries. Frank proposed this a year or so ago, pre-TARP and didn’t succeed. Now armed with a new rationale for the same fascist goal, he’s got a chance. I’d rather see my company collapse, throwing all my employees out of work and start again, rather than grovel before someone like Frank for permission to pay people what I thought they should be paid. I’ll be disappointed if a large number of corporate chiefs don’t agree.
Well no, at least not yet, but this Bloomberg article describes the sorry state of Greenwich Avenue retail and if it’s accurate, can Hotsy’s chilibe far off? I ordinarily discount these out-of-town stories about the woes of Greenwich but the reporters interviewed real live shop owners and they sure sound glum. Besides, the story’s right: it is much easier to find a parking space on the Avenue. I assist an older friend on Fridays and this morning we had three stops on the Avenue, a chore I usually dread. No problem now – if that keeps up, I may try shopping there myself some day.
UPDATE: Leave it to a real estate agent to ignore the horse apple:
“The hedge fund people that lost $200 million still have $200 million,” said Adam Zeiberg, a real estate broker with FirstService Williams who leases retail space on Greenwich Avenue. “They have tremendous amounts of money.”
He obviously isn’t talking to Goldman Sachs people.