This is not good news for Greenwich real estate prices

Investment banks’ profit structure is being permanently degraded.

Europe’s failure to resolve its sovereign-debt crisis will force investment-banking chiefs in the region to consider shuttering entire businesses rather than rely on piecemeal job reductions to revive profit.

Dealmaking fees may drop 25 percent this year from 2009, when the crisis began in Greece, research firm Freeman & Co. estimates. European banks have cut about 172,000 positions since then, according to data compiled by Bloomberg, the same strategy they used after Lehman Brothers Holdings Inc. collapsed in 2008.

The game plan won’t work again as rising capital requirements and declining business alter the investment-banking landscape, investors and analysts say. New rules will reduce return on equity by 6 percentage points from about 14 percent in the first half of 2011, according to consulting firm Bain & Co. Banks that relied on record low interest rates and a flood of cheap funding from the European Central Bank to delay deciding which units to close will be compelled to make choices.

“Investment banks have to shrink and do more than cut a little bit here and there,” said Lutz Roehmeyer, who helps oversee 10 billion euros ($12.5 billion) at Landesbank Berlin Investment in Berlin. “There’s too much politics and too little economics going on. They want to keep certain businesses for as long as possible.”

The Bloomberg Industries European Investment Banks Index, which tracks UBS,Barclays Plc , Deutsche Bank AG and Credit Suisse Group AG, has dropped 5.3 percent this year compared with a 14 percent gain in the 329-member MSCI World Financials Index. European banks that have investment-banking businesses trade at an average of 62 percent of book value, while European financial firms trade at about 90 percent.

The five U.S. lenders with investment-banking and trading units – Bank of America Corp.,Citigroup Inc. (C), Goldman Sachs Group Inc. (GS), JPMorgan Chase & Co. (JPM) andMorgan Stanley (MS) – reported their lowest first-half revenue since 2008 and have stock prices that value the firms at a lower percentage of book value than banks without capital-markets units.

It’s a conspiracy, I tell you: Republicans have taken over the Democratic Party

Democrats dispatching Joe Biden to Tampa during the Republican’s convention. I don’t think a game of “compare and contrast” when it’s played with Biden is going to help the Dems.

About as dumb as the now-vetoed plan to send Todd Akins to Charlotte next month.

Attention, (non) Coldwell Banker agents: we’re assembling data

Caption Contest

“Anonymously Yours” sends along this photo and suggests a caption contest. Great idea.

“This space for rent sale”

“I’ll say what you want and want what you say”

“This space intentionally left blank”

Others? Pile on.

Coldwell Banker suffering cash flow problems?

A Coldwell banker

Just ran into an agent from another firm and she tells me that she, too is being stiffed on a rental commission by Coldwell Banker. That makes four ongoing defaults and that makes me think that the firm is hoarding cash.
Given how relatively small rental commissions are, CB must be in big trouble or it’s adopted a new business plan to screw what were once known as “cooperating brokers”. Either way, I doubt they’ll be much cooperating in the future

Not that party convention platforms mean anything at all, but a good idea nonetheless

For the encouragement of others

Republicans remove preserving mortgage interest deduction from their platform. If you can get past the reporter’s knee-jerk idiocy (“giving Mitt Romney more flexibility to promote his plan to lower tax rates paid by corporations and the wealthiest Americans without increasing the federal debt”), this is an excellent idea, long overdue. Why should renters pay for their housing with pre- after - tax earnings while homeowners get a deduction? That’s as ridiculous as forcing the self-employed buy medical insurance with those same after-tax earnings, of pay 15% of their income to Social Security or .. wait a minute ….

In any event, we’ll not hear of this again, except from the Democrats. The mortgage interest deduction may distort demand and disadvantage those who can’t buy a home but it’s beloved by builders and Realtors and that’s that.

“The mortgage-interest deduction is high on the list for all Realtors,” said April Newland, a convention delegate from the Virgin Islands. She termed it “the last vestige of why people would be interested in buying a home.”

If the deduction is now the only reason why people would want to buy a home then we’re in far, far more trouble than anyone has so far let on.

Shhh! Young minds being molded

You just mustn’t drink before visiting with Korean massage girls and if you do, don’t complain

Who knew?

Man claims he was sexually assaulted at massage parlor. The institution has been raided for prostitution in the past so it seems unlikely that the customer was justified in being surprised by such a low blow. My guess? His girlfriend found a receipt.

No news is no news

The market has pretty much shut down for the last two weeks of summer so while I’ll report anything that turns up, don’t expect much, if anything.

Picking on the retarded is just cruel

Glastonbury: Police arrest man who advertised for pot on Craig’s list.

UPDATE:  A reader takes me to task for failing to use the current politically correct term for “retarded” (which itself was considered an improvement over “imbecile” when first introduced). As usual, Georg Carlin addresses the issue best.

UPDATE: But wait, there’s more! ”Illegal aliens protest label illegal aliens”.  ”It hurts our feelings”, explains Rodreguez Emanuel Xpltzyski; “we prefer ‘just visiting’.”

Hoo boy. Anyway, here’s Carlin:

Down these mean streets or, good habits cannot be started too young

Hit him again, hit him again, harder, HARDER!

At Joey B’s place: Delaware day care center closed, workers arrested after staging-fight- cub club -like event for 3-year olds.

DOVER, Del. (CBS) – Three daycare employees were arrested on Monday for watching and encouraging toddlers to fight each other while under their care.

According to Dover Police, three employees from the Hands of Our Future Daycare in Delaware were arrested after a cell phone video showed employees watching and encouraging two 3-year-olds fight each other.

Tiana Harris, 19, Lisa Parker, 47, and Estefania Myers, 21, were charged with Assault, Endangering the Welfare of a Child, Reckless Endangering and Conspiracy for the incident, which occurred in March of 2012 and was captured on cell phone video.

Whaddya bet this holding pen receives federal funds?

(“Hands of our Future Daycare”? For a kiddie boxing school? Perfect.)