Hope springs eternal at Goldman Sachs.
This morning our favorite Banksters goosed the EU markets by upping targets on international mining operators Kazakhmys, Lonmin and BHP and that got the European markets off to a flying start out of the gate, despite the fact that UBS had just DOWNgraded the same sector on Friday. UBS said on Friday that the sector is facing difficult times concerning potential growth with government rulings on mineral leases and the proposed supertax on mining profits in Australia set to hinder metal-based stocks.
We also have a lot of M&A activity, also courtesy of GS, who are leading the resurgence this year with 225 deals to date worth $401.6Bn, accounting for about 20% of all activity going through Goldman’s sticky fingers. In a sign of the times, however, GS only generated $961M in revenues as an M&A advisor as they cut a lot of discounts in order to land the top spot in dealmaking. Although outdealt by GS, MS, Rothchild, JPM and DB all made more in fees than the Uncle Lloyd show.
In a sign of the end of times, GS’s London Headquarters has been taken over by lenders after the owner fell into receivership. GS’s landlord, Antedon, is an offshore real estate firm that bought the building for $500M at the top of the market in 2007 and GS has locked up the building through 2026 at what seems to be not enough money to keep Antedon liquid – it would be very interesting to trace the web of deals that led to this massive default.
Meanwhile, the consortium of Irish investors that own GS’s other London building are also bailing out, this action is coinciding with what Ireland’s Independent says is a campaign by Wall Street Hedge Funds to short sell Irish Government Bonds. US hedge funds Groveland Capital and Corrientes Advisors are thought to have taken major positions against Irish debt. Giant €60bn asset-manager Pictet also revealed that it had earlier bet against Irish government bonds. JP Morgan is also thought to have taken a bearish position on Irish debt. The International Monetary Fund estimated that up to €3bn of Ireland’s debt was being targeted by speculators through the uses of derivatives.