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Archive for the ‘Money Talks’ Category

Trolling Craigslist Boston

Thanks to the alleged “Craigslist Killer,” Philip Markoff, 22, of Quincy—now under arrest—Craigslist is back in the hot seat. The Boston branch of the site is great for locating apartments, free furniture, soliciting prostitutes, finding jobs, massages with happy endings, selling stereo equipment…

Apparently all those “To Catch a Predator” marathons haven’t tempered the urge to solicit sex online. Earlier this month Cook County Sheriff Tom Dart posted ads reading, “15-year-old looking for sex” and received three hits including one from a convicted sex offender. No complaints were filed by users of Craigslist, which bear the brunt of policing certain sections of the site. Dart subsequently filed a lawsuit alleging that Craigslist is “facilitating prostitution.”

Locally, Worcester police nabbed 50 suspects in a prostitution sting operation between Thursday and Saturday of last week. A female officer posted an ad on Craigslist and police arrested the men and women who appeared at the undisclosed hotel.

Boston Daily did a quick scan of Boston’s Craigslist to see if the Killer affected local business. Under “Erotic Services,” women still offer their services to men, men to women, men to men, women to women and any other conceivable arrangement. One ad says, “$150 $150 $150 asian treat 100% real pic.” The pictures, though mildly censored, don’t leave much to the imagination or comply with Craigslist anti-pornography regulations. (more…)

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Don’t Mess With Galvin

Just when we thought the $50 billion Madoff saga couldn’t get any dumber… it totally redeemed itself!

The Globe reported that Bernie Madoff may not have made any trades with the funds invested in his company. That’s right, not a single, solitary trade was executed by his brokerage firm, according to the Financial Industry Regulatory Authority. If he was making any trades, it was solely by placing his trades through other investors, not through his own brokerage firm, Bernard L. Madoff Investment Securities.

So if he wasn’t making every trade through other firms—which would be highly unusual—then he was fictionalizing entire statements to his investors. Beth Healy, of the Globe, writes, “Statements were often so complicated that investors had to call representatives of the firm for explanations.” Um, no comment?

One of those representatives could have been Robert Jaffe, whose own role in the scandal deepened today. Jaffe, the VP of Madoff’s Cohmad Securities subsidiary, served as his point man in Boston, recruiting investors for the scheme. The Newton native failed to show for a subpoenaed meeting with regulators in the Bay State Securities Division on Tuesday. Yesterday, Secretary of State William Galvin, who oversees the Securities Division, sued Jaffe for failing to appear. (more…)

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Money Talks: The Curious Case of Biswamohan Pani

What was Biswamohan Pani thinking?

Pani is a 33-year-old computer engineer recently accused by the FBI of stealing trade secrets from Intel, his former employer. According to the government, Pani was intending to use the information he had gleaned from studying Intel’s next generation of microprocessors at his new job at Intel-competitor Advanced Micro Devices (AMD).

Pani’s attorney, Bradford Bailey, has said that his client is innocent and will vigorously defend himself in court (his arraignment is scheduled for next week). In the meantime, there is no evidence that Pani actually shared secrets with AMD, or that AMD asked him to.

But then what was he intending to do? (more…)

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Money Talks: Real Estate

1226000167Consumer confidence may be at its lowest point ever, but owners of some of Boston’s highest-end homes are feeling pretty darned optimistic about their chances in the market. As the website Luxist points out today, the owner of Beacon Hill’s Appleton-Parker house has just listed the 10-bedroom mansion at $27.5 million.

If it sells at that price—or anywhere close to that price—it will set a new Boston record.

The sale isn’t a sure thing, of course. The previous contender for the single-family record is still on the market for $14.95 million (and with a new broker). Last year, an owner from Trinity Place, near the Boston Public Library, listed a penthouse combined from two units for $15 million, (which would have been a record price).

When the penthouse didn’t sell, though, the owner dropped the asking price by about $3.5 million and split the condo into two, both still on the market: A 4,265 square foot one for $7 million and a 2,838 square foot one for $4.5 million.

But others are having better luck. (more…)

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Money Talks: Taking on Question 1

1225380892I was driving down my street this morning, pleased with the recent repair of a road that last week was pockmarked with potholes, when I heard a debate on WBUR about Question 1.

Question 1, as we all know by now, is the ballot initiative seeking to abolish our state’s 5.3 percent sales tax. The measure nearly passed last time it was on the ballot in 2002, and analysts expect an even closer race this time around. (Our friends over at Universal Hub posted a nice roundup of arguments from both sides of the issue.)

During the ‘BUR interview, Carla Howell, president of the Committee for Small Government, argued for getting rid of the tax (that’s a “Yes” vote), while Paul Guzzi, president of the Greater Boston Chamber of Commerce, made the case for why it should stay (that’s a “No” vote).

With all due respect to Howell and her supporters, getting rid of the income tax is a crazy idea. (more…)

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Money Talks

1222711722Every Thursday, Francis Storrs will take an inside look at high-stakes finance and dealmaking. This week: The strange fluctuations of the auction market test those old financial truisms.

There’s an old truism that says the extremely wealthy always make out okay, even when the economy is in the tank. Another truism says that the art world is immune to shakeups in the economy. These days, of course, all kinds of old wisdom is looking out of date.

Just as the rest of us cut back on our little luxuries—eating out at restaurants, say, or keeping our thermostats above 60 degrees—the rich cut back on theirs. Last weekend’s Frieze art fair in London had just over $90 million in sales. That’s nothing to laugh at, but it was still about half the auction estimate. And yet last month’s Damien Hirst auction in that city made the artist nearly $200 million, smashing all kinds of records. (more…)

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Money Talks: Special Joe the Plumber Edition

1224179796Hey, Joe Sixpack, meet Joe the Plumber. It seems like everyone else already knows him. Barack Obama and John McCain certainly do—they spoke directly to him 26 times during last night’s debate. Never mind that the guy that spurred all of that talk, Joe “the Plumber” Wurzelbacher, isn’t really a licensed plumber after all.

The candidates, of course, were addressing more than just Wurzelbacher; they were speaking to all the hardworking Joe the Plumbers out there. Chances are, you already know at least one of them (there are a good dozen in this area alone.)

Here’s what a half-dozen real Joe the Plumbers had to say about being addressed on national TV. (more…)

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Money Talks

1222961516Every Thursday, Francis Storrs will take an inside look at high-stakes finance and dealmaking. This week: The do’s and don’t’s of the gold market.

In times of financial crisis—like now, for instance—there is always a run on gold. Last Friday, the demand got so unwieldy that the US Mint had to temporarily suspend the sale of its 24-karat American Buffalo coin.

“My phone is ringing off the hook,” says Ken Murphy of Boston Bullion (located, somewhat confusingly, in Arlington). “My dealers usually have at least $5 million worth on hand and they’re sold out.”

Although the only gold I own is in my wedding ring, I understand the appeal. People like to have an investment they can hold, put under their pillow, or drop on their foot if they’re so inclined. (Try that with a collateralized loan obligation.)

Since I aim to please here at Money Talks I asked Murphy for some pointers about the bullion business. If you’re looking to put sink some of your money in gold—please not everyone at once, that’s what got us into this mess—here are five things you need to know. (more…)

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Money Talks

1222361138Every Thursday, Francis Storrs will take an inside look at high-stakes finance and dealmaking. This week: The Forbes 400 shortchanges Bostonians.

Forbes has just published it list of 400 Richest Americans and, according to the magazine’s estimates, a mere seven billionaires call our state home. That’s embarrassing. California has 25. So do New York and Texas. And yet we’re stuck between Washington state (6) and Connecticut (9). Can’t we do better than that? I think we can.

First, it’s worth catching up with the list’s usual suspects. Abby Johnson and her father, Ned, are the state’s wealthiest people (with fortunes estimated at $15 and $11, respectively). Don’t look for that to change.

As a private company, Fidelity is largely immune to the investor panic that helped torpedo public firms like Lehman Brothers. If anything, Fidelity is actually busier as investors move their dwindling accounts from sinking public ships to the old Ironsides that is the Johnson family business.

Rounding out the Mass. list are Beacon Hill resident Amos Hostetter ($2.8 billion); New Balance’s Jim Davis ($2.5 billion); Bob Kraft ($1.5 billion) who should see a bump next year thanks to Patriot Place; the indomitable Amar Bose ($1.5 billion) and EMC-cofounder Dick Egan ($1.5 billion). (more…)

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Money Talks

1219934940Every Thursday, Francis Storrs will take an inside look at high-stakes finance and dealmaking. This week: Counting down the five worst predictions of the financial crisis.

Okay, I get it: The financial big guns need to project confidence in these uncertain economic times, lest their empires crumble in a cloud of vicious rumors and worthless stock certificates. Confidence is one thing, wishful thinking is quite another. Lately, we’ve been seeing far too many examples of the latter.

Consider Bear Stearns, the 85-year old investment bank that fell apart in a matter of days this spring. On March 12, CEO Alan Schwartz appeared on CNBC to address rumors that the firm was running out of cash. “We don’t see any pressure on our liquidity,” he said, straightfaced. “Let alone a liquidity crisis.”

In a move that demonstrates nothing if not a liquidity crisis, Bear averted bankruptcy just a few days later by selling itself to JPMorgan at the fire-sale price of $236 million (for those of you keeping track, that meant paying $2 a share for a company that had traded at $170 a year earlier).

Schwartz wasn’t the first person who made a ridiculous prediction when he should have known better. After the jump, my five picks for this year’s most wrong-headed prognosticators. (more…)

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