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More Bad News - Where Will It All End ?

End of Earth to Bull Market

American International Group (AIG) came out Monday and confirmed that its external auditors had discovered a 'material weakness' in how the firm values its credit-default swap portfolio. The upshot ? AIG will be taking a $4.88bn writedown. The firm's shares fell 11%, wiping $14bn off its market value.

Rogue Trader Instant Messages Revealed

32 year-old futures broker Moussa Bakir was detained by French police Thursday(and released 2 days later without charge) because it was discovered that he was involved in instant message chat exchanges between October 2007 and January 2008 with Societe Generale's $7.1bn rogue trader Jerome Kerviel. Here are some of the exchanges:

Firm Likely To Shed 1,500 Jobs

Mixed news over at WestLB. As the German bank gets a $7.2bn bailout from its owners, which include the state of North Rhine-Westphalia and two regional savings-bank associations, 1,500 staff are thought likely to lose their jobs, or around 25% of total headcount, as the bank reins in its horns and restructures. The job losses will occur both in Germany and overseas. The bank will also shift over $33bn of debt securities into a new off-balance sheet entity, which will be guaranteed by shareholders.

Top CEOs Lose $1bn, But Little Folks Suffer More

The Sunday Times reports that top Wall Street bosses (and ex-bosses) are looking at paper losses of $1bn, as falling share prices, caused mainly by subprime-related losses and the subsequent credit crunch, have taken their toll on the market capitalization of their firms. As usual, however, it's the little folks who will suffer more. Wall Street big-wigs have deep pockets, but retail investors are feeling the pinch, and employees at many firms have paid the price with salary freezes, smaller bonuses and, in some cases, by losing their jobs.

SG's Rogue Trader Comes Back Down To Earth

Societe Generale's $7.1bn rogue trader, Jerome Kerviel, came back down to earth with a bump Friday, as a Paris Appeals Court ruled that he should be placed in 'temporary' detention. And 'temporary' could end up being 12 months or more, as it's likely to take at least a year for those intrepid Gaullic investigators to work out exactly what went on, and complete their report. Kerviel's lawyers have indicated, however, that they will appeal the decision.

ABN, Citi, Dresdner, HSBC, JPM, Nomura, Quattrone

The Wall Street Journal reports that Bank of America filed an appeal to the Dutch Supreme Court Tuesday, seeking to remove a lower court's decision to freeze the sale of the ABN AMRO unit LaSalle, which it is contracted to acquire in a deal worth $21bn. The Court is expeceted to rule by early July.

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