• Rebalancing Bonuses, for Goodness Sake

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    Now where are the ‘animal spirits’ going to go?

    Deutsche Bank just took its most daring step yet to reprogram its workforce.  It adopted a policy denying the bank’s top-performing traders plum promotions and fat bonuses if they’re deemed to be “disruptive” or non-team players.   DB knows that this reform will lead to high-level departures, but, in announcing it, Colin Fan, DB’s co-head of investment banking, said that “these are people [who] probably won’t fit into the new banking environment anyway.”

    To risk losing its star traders, DB must have concluded that nothing else could transform a culture of pure profit into one of playing by the rules.

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    Why Sukuk Are Catching On

    Publicly-beneficial financings with predictable revenues and profit potential

    This June, the UK became the first non-Muslim sovereign to issue sukuk and, later this month, South Africa will become the second.   Luxembourg and Hong Kong are reportedly soon to follow.   

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    Did Bill Ackman Trip over Allergan?

    In amassing his huge stake, he may have stepped into insider trading territory  

    If his death threat against Herbalife wasn’t risky enough, Bill Ackman’s recent hook-up with Michael Pearson of Valeant Pharmaceuticals has turned into an even more precarious campaign. 

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    Connecting with an Angel

    Taking a high-potential start-up to the next level

    Angels are investors who finance start-ups after the entrepreneurs have put up their own capital and raised additional funding from so-called friends & family.  Angels only invest in new businesses which they believe can return big numbers. 

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    France’s Very Bad Bank

    Did BNP Paribas get off easy?

    As the most liquid currency on the planet, the American dollar is by far the denomination of choice in international trade.1  Those who can’t access it are effectively barred from global commerce.

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    Lifting the Lid on Private Equity

    Who knew what PE managers were hiding from their investors?

    Are private equity documents so opaque that even sophisticated investors couldn’t possibly figure out how much PE firms actually earn (or save) from their portfolio companies?

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    The Curious Case of Jérôme Kerviel

    Whose fault is it when your job is to make as much money as possible?

    Back in 2008, it certainly looked as if rogue trader Jérôme Kerviel was acting alone.

    He had built up derivative positions in the astronomic amount of €50 billion ($68.5 billion) – way beyond his trading limit – and had admittedly concealed them from his employer, Société Générale, by creating fake, offsetting trades in its computer systems.  

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    Is Activism Good or Bad?

    It all depends on your investment time horizon . . .

    Statistically, hedge fund activism was off the charts in 2013.  It was the top-performing hedge fund strategy by far and its practitioners won more proxy contests, attracted more capital and targeted bigger fish than ever before.

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    The “London Fix”

    How seven big banks secretly manipulated the global currency markets

    Just how exactly did foreign currency traders at Barclays, Citigroup, Credit Suisse, Deutsche Bank, JPMorgan, RBS and UBS secretly rig global exchange rates for almost a decade?