♦ Dick Parsons is the frontrunner to replace Sir Win Bischoff as chairman of Citigroup. [Reuters]
♦ Steve Rattner is shutting down the Quadrangle Group's hedge fund amid weak performance and investor redemptions. [WSJ]
♦ Phil Falcone, Ken Griffin, John Paulson, Jim Simons and George Soros will appear in front of a House panel today. [DB]
♦ Hank Paulson is taking a beating following the news that the Treasury will now focus on struggling consumers, instead of financial institutions. Paulson has become "a reduced figure, damaged by the financial-market meltdown that happened on his watch and by the government's struggles to respond to it." [WSJ, DB, Bloomberg]

♦ With so many companies looking to tap into the $700 billion bailout, it's clear there won't be enough to go around, and a lot more work (and cash) is going to be needed to fix the problem. [WSJ]
♦ The latest company to convert itself into a bank to tap into government funds: American Express, which earned approval from the Fed to become a commercial bank yesterday as it seeks to cover rising credit card defaults. [Bloomberg]
♦ GM's possible bankruptcy was a major topic of conversation at the White House yesterday when Barack Obama met with George Bush. Meanwhile, shares of GM fell to $3.36 yesterday, its lowest level since 1949. [WSJ, Bloomberg]

♦ Citigroup is in talks to buy a regional bank, says the WSJ. Which bank it is they're planning to acquire isn't clear. [WSJ]
♦ The bailout of AIG that was originally going to cost $85 billion and was later revised to $123 billion? Yea, well, now it's $150 billion. [WSJ, Bloomberg]
♦ October was another down month for hedge funds: Since the beginning of September, the average fund has shed 10 percent. [NYP, Bloomberg]
♦ The man who may go down as the hedge fund industry's big winner in 2009: Jim Chanos, whose Ursus fund is up 50 percent so far this year. [NYP]
♦ Asian stocks rallied on Monday after China announced a $586 billion bailout package. [Bloomberg]

♦ Lawmakers and officials are moving close to ironing out a second stimulus bill after Fed chair Ben Bernanke endorsed the idea. [Bloomberg, NYT]
♦ The Treasury Department is pushing bigger banks to use the rescue package to acquire smaller, weaker rivals. [NYT]
♦ The Dow's 413-point rise yesterday was attributed to signs the credit market is beginning to thaw. [NYT]
♦ Some people are still making out nicely: Peter Kraus, the head of strategy at Merrill, will be leaving the firm after just a couple of months with as much as $25 million. [WSJ]

♦ The world's central banks are joining together to carry out a coordinated (and unprecedented) cut in interest rates, part of a plan to restore confidence in the global economy. [WSJ, NYT]
♦ Speculation that Morgan Stanley's deal with Mitsubishi UFJ had fallen through led to a huge drop in Morgan's stock price; the Japanese bank now says the deal will be done by this weekend. [Bloomberg]

Today this guy I know ruminated about why white bloggers employ so many goddarn exclamation points. I didn't really read it because I have ADD and assume everyone else does too so when I do actually bother employing punctuation at all it is usually for the purpose of impressing upon everyone the total urgency of whatever it was I just wrote and what better way to achieve that than an exclamation point!? (Or four!!!!!!) But hey wait, I actually know where I picked up this silly habit — another white blogger! Back from before they called them blogs, tho. There was this ZOMG-tacular writer Andy Serwer who wrote a daily stock market column on the Fortune website called "Street Life." It made no sense!!!! Except to me. (The synthetic constant proportion portfolio insurance of online commentary!) So you can blame that guy for everything, including the credit crisis! Anyway it's in Andy's honor (he still writes a blog, but it's no longer crazy because he is on teevee now) that I wrote the evening's Panic Roundup in the Steez De Serwer. (Shall I call it "Manic Panic"?)Okay, so, today's Times byline orgy re-enactment of that coupla days a coupla weeks ago where suddenly every banker was like "OHSHTWRSCRWD" achieved two important things: 1. Reminded "Main Street" (Aside: irk you as much as it does yours true that the pols keep calling it "Main Street" when the whole reason this started is because there's NO SUCH THING anymore in this country?? Because everyone had to have his own house, recall?? Anyhoo) that, you know, every business in this freakin country operates on debt, not because they're spoiled delusional children like every last CEO on the Street except John Thain (which reminds me, Johnny Boy is staying on with the new Bank of AMerillca! See, you KNEW he wasn't in it for the nine figure pay package, aw…) but because DUH, because that's like the basis of all civilization or something!! And 2. Reminded Wall Street Just How Crazy it is with a creepy/inspiring (which? both?) anecdote about Black Thursday over at Goldisachs. Lloyd was freaking out, Goldman stock in freefall, etc. etc.…and then one o'clock rolls around and someone they identify as a "prankster" starts playing the "Star-Spangled Banner" over the loudspeaker. All the bankers are like, what?! Some even put their hands over their hearts. And at THAT VERY MOMENT, the stock stopped falling. Turned up a little even! Guess what had happened? That's right, a short-selling ban had just been announced!! Capitalism itself had been suspended! Think that means there's something Goldman guys find inspiring about this country… other than its free market?? Yeah probably not, but I thought about shedding a tear! Okay so moving on, the big story is…well shucks, got a few hours? No of course not! We're all about to hit me baby one more time with another public appearance by everyone's fave fakenbaked ratings black gold governess!!! (Broad is like Merrill with the CDOs after even AIG stopped insuring them, we know she's bad for us, but we just can't stop.) So I'll make it quick: everyone, except maybe Buffett and John not to be confused with Hank Paulson, is screwed: every other hedge fund is screwed, Veronica Peterson of Columbia, Maryland, who is trying to pay a $4,450-a-month mortgage on fifty grand a year — hey, why not have a go at that, quant jocks? — is screweder, the market that is being artificially propped up by the continued short sale ban managed to fall 350 points today anyway, not that anyone is paying attention to the market because the entire private sector is too busy wondering where the heck they're supposed to find a line of credit when the entire financial system won't trust anyone but the guv-mint with its money anymore. Yikes! Oh, though if Veronica Peterson's story shook your faith in private enterprise, here's a doozy from the public sector: there's a special provision in the new bailout bill offering (SORELY-needed) tax relief to the makers of wooden arrows used in bow-n-arrow sets for children. Think you could poke someone's life out with one of them things? Anyway, if I were really Serwer this is where I would actually round up a few MORE asides and tangents here and call them "Loose Change," but in the Web 2.0 era that gets to be your job! Although if Dismal Science wants offer himself for the position of Serwer's old standby source "Deep Blue" (sug. nickname change: "Deep Shit") he knows who to G-chat!

♦ President Bush urged Americans to support the $700 billion bailout during his televised address last night, the first time he's ever devoted a primetime speech to the economy. Meanwhile, thousands of politicians continue to clash over the specifics. [NYT]
♦ Warren Buffet was drinking a cherry coke and eating mixed nuts last Tuesday when he got a call about investing in Goldman Sachs. He hammered out the $5 billion deal in about 15 minutes and then moved on to Cheetos and "licorice pastel candies." [WSJ]
♦ WaMu may not have much time left. [Bloomberg]
♦ Lehman Brothers chief Dick Fuld reached out to GE CEO Jeff Immelt before the firm filed for bankruptcy. [NYP]

This really weird ad decrying "The New Communism" ran on A17 of the Times today. It was paid for by some plutocrat in Houston named Bill Perkins who supports Obama. I think it advances my general contention that some of the fiercest critics of the Washington-Wall Street complex are actually beneficiaries of that whole scam, because Perkins's firm Crystal Energy LLC would appear to be precisely the sort of outfit to which God instructed Sarah Palin to fast-track lucrative contracts decimating the environment in pursuit of cheap energy.But I don't actually know because today's Senate hearing cut his CNBC interview down to about one and a half seconds. In any case, I hope the Times still has a Houston rep who can take this guy out to dinner. Who knows, maybe he can rustle up some other likeminded rich guys with money they'd be wiling to give newspapers now that capitalism as we know it has been suspended.

♦ The world's major central banks teamed together to flood the markets with dollars as part of an effort to contain the unfolding financial crisis. [WSJ, NYT]
♦ Morgan Stanley has been in talks with Wachovia, Wells Fargo and the Chinese bank Citic; Morgan's CEO, John Mack, blames short sellers and rumors for yesterday's big drop. [NYP, CNBC, Dealbook, WSJ]
♦ Washington Mutual's bankers at Goldman Sachs are "frantically looking for a buyer or a capital infusion in the next several days." [NYP]
♦ Rules introduced by the SEC today will make it harder for traders to drive down prices and will require them to share more info about their trades. [WSJ]

• Investors generally reacted positively yesterday to the news of the Fannie Mae and Freddie Mac bailout. [WSJ]

• The price of oil has dropped after Hurricane Gustav did less damage than initially feared. [CNNMoney]

There's another vivid memory I have of Hunt. It was maybe two years later. In the middle of one of our hang-around days, I put the question to him: "So, Hunter, what do you want to be when you grow up?"

"I want to be important." I knew what he meant.

A tipster sent us this help-wanted ad from "a quantitative hedge fund with offices in Palo Alto." The ad asks applicants to flip a coin 50 times and record the sequence of heads and tails. Are they breeding for luck, or just looking for someone who'll slog through hours of statistical dullness without first asking why?

• Federal prosecutors are investigating two ex-Credit Suisse brokers, Eric Butler and Julian Tzolov, over whether they lied to clients about their investments in auction rate securities. [WSJ]

• Embattled Lehman chief Dick Fuld will forgo his 2008 bonus as a "peace offering" to the investment bank's managing directors. [Dealbook]
  

Hey, Sanjay Sanghoee, the hedge funder who's raising money from hedge funds to make a movie about a heroic hedge funder, has apparently been trying this nonsense since college. A former business school peer of Sanjay's just emailed us to inform us that back at Columbia, Mr. Sanghoee "was the founder, president and sole member of the Film Financing Club." He's been sending these fund-seeking mass emails for years. Former b-school associates received this one just a few weeks ago, as the banking crisis threatened the money Sanghoee had raised to date. If his screenplays are half as captivating as his pitch emails, it'll be a hell of a picture.

It's worthwhile sometimes to stop and think about the real victims of today's tanking American economy. Like Sanjay Sanghoee, a hedge-funder who's running into trouble financing the film version of his corporate intrigue novel. The novel, Merger, is your standard tale of "an Indian corporate titan who begins a hostile takeover of a satellite company that transmits information from the C.I.A." Obviously, it'd make a great little indie film. So Sanghoee, none of whose Law & Order spec scripts were ever accepted, raised millions in private money from his hedge fund friends. They loved the book, and the pitch, and the fact that it was a movie made by a banker about bankers. But then, the mortgage crisis! Suddenly, not even a verbal agreement from Lara Flynn Boyle "to take a supporting role as a sultry henchwoman" was enough to keep the checks rolling in.

It's comforting to know that no matter how much money you make—like, if you work at a hedge fund, for instance—you will still be hanging out in the same rotten Times Square bars, drinking Coors Light. This is how I met "Charlie" The Hedge Fund Manager and tried my best to learn how they work, in order to make the Real Money some day. Here is his advice: "You don't hafta study the European markets, you just gotta buy a bunch of good stocks and hold onto them." Advice: "Some guys work long hours, but not me." Finally, the moment of reckoning: "I don't know what I'm doing here!" he moaned, looking out onto Eighth Avenue, where some dude was puking in the middle of the street. "I'm a fuckin' billionaire."

A gain of $4.5 billion dollars in just the last fiscal year (which ended in June) puts the New Haven-based Ivy League university called Yale tops in growth among schools with endowments over one billion bucks. In 1985, the school's endowment was a mere $1.3 billion. How do they do it? Probably really risky investments in private equity firms and hedge funds! Enjoy it while you can. With this growth, Yale would pay more into the $2 billion operating budget than its current rate of 5.25% of the endowment, but it limits the funds paid out to the school to "withstand lean years." Lean years which will surely never, ever arrive.... or have already!

Tim Sykes, formerly one of Trader Monthly's hot "30 under 30" who was the the butler-having star of 'Wall Street Warriors', has fallen on very hard times. He says that, due to investment in illiquid stocks, he is "unable to raise any money, unable to take any trading risk so all I can do is take advantage of my publicity efforts and turn that into my new career." He's now "a reporter for TheStreet.com" and MSN Money's "goto video guy." This all comes from his email correspondence with Trader Monthly; they banned him from their big party this week. In return, he offered them five great reasons why he should be reinvited! You see, he's now a financial expert in the media—even though his hedge fund bit it!