Hedge Fund
I should at some point clarify from VC, M&O etc note that intel firms are making partnerships: stratfor and mongoven
see private equity
see pluto 3 billionaire
oligarchy?
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12 23 an
america’s prestigious universities play a big role in determining who gets into America’s wealthy elite.
A degree from Harvard, Penn, or M.I.T., to take three examples, is a meal ticket to a lucrative job on Wall Street or a corporate law firm and to the richest and most influential people in the land.
But as America becomes increasingly stratified by wealth, those tickets are easily abused.
Universities that give preference in admissions to the children or grandchildren of major donors serve to widen inequality even further.
Universities that allow major donors to influence what is taught or expressed on campus could be seen to suppress ideas that threaten the wealthy — which could chill freedom of expression and fuel social resentment.
Which brings us to the latest imbroglio.
Last Tuesday, the presidents of the University of Pennsylvania, Harvard, and M.I.T. tried to give precise answers to questions from members of Congress about whether their university cultures had encouraged hostility towards Jews — hostility that has surged since Hamas’s October 7 attack on Israel and Israel’s attack on Gaza in response.
In their opening remarks, all three denied it, and repeatedly condemned antisemitism.
Then Elise Stefanik, a Republican representative from New York (and herself a Harvard graduate) asked a yes or no question: would calls for genocide of Jews on campus violate their codes of conduct or harassment policies?
The presidents hedged. “If the speech turns into conduct, yes, it can be harassment,” Penn’s president, M. Elizabeth Magill, a former dean of Stanford Law School, replied in lawyer-like fashion.
“I’m asking if specifically calling for the genocide of Jews — does that constitute bullying or harassment?” Stefanik pressed her point.
“If it is directed and severe or pervasive, it is harassment,” said Magill.
“So the answer is yes?”
“It is a context-dependent decision, congresswoman,” Magill said.
Faced with the same question, Harvard’s president, Claudine Gay, also temporized. “It can be,” she said, “depending on the context.”
The university presidents should have answered unambiguously and unequivocally that calls for genocide of any group are intolerable.
Their failure to do so has fueled a firestorm.
Ross Stevens, a hedge fund manager, said he would withdraw a $100 million gift to Penn. Other wealthy Penn donors called for Magill to resign.
Even prior to the hearing, a campaign had been launched by some of Wall Street’s most powerful figures to oust all three university presidents for failing to adequately condemn Hamas’s October 7 attack on Israel.
The influential board of advisers of Penn’s Wharton School’s, chaired by Marc Rowan of Apollo Global Management, one of the world’s largest private equity firms, called on alumni to withhold donations to Penn.
The billionaire investor Bill Ackman, Harvard alumnus and head of New York hedge fund Pershing Square Capital Management, called for the three university presidents to be fired.
The day after their testimony, Magill and Gay issued statements in efforts to contain the damage.
But on Saturday evening, after an emergency meeting of Penn’s board of trustees, Magill resigned under pressure.
Over the weekend, calls from donors for Harvard’s Claudine Gay to resign grew louder, as prominent donors demanded her ouster, too.
I can well understand the anger and frustration of these donors. In their congressional testimony, the university presidents should have been clearer that their institutions do not tolerate calls for genocide. Period.
But to use their power as major donors to force or seek the ouster of these presidents is almost as repugnant as the failures of these presidents to unambiguously condemn calls for genocide. It endangers the autonomy of America’s universities.
Who’s kidding whom? Those of us who have spent our lifetimes teaching in prestigious universities are well aware of the influence of big donors. The major job of today’s university presidents is to solicit money, and their largest targets are typically denizens of Wall Street.
For the same reason, boards of trustees are packed with wealthy alumni, often from the Street, who routinely veto candidates for university presidentships harboring views they find offensive.
But not until now have major donors so brazenly used their financial influence to hound presidents out of office for failing to come out as clearly as the donors would like on an issue of campus speech or expression.
As a Jew, I cannot help but worry, too, that the actions of these donors will fuel the very antisemitism they claim to oppose — based on the perilous stereotype of wealthy Jewish bankers controlling the world.
*Robert Reich is a professor at Berkeley and was secretary of labor under Bill Clinton. You can find his writing at https://robertreich.substack.com/.*
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https://theconversation.com/engine-no-1s-big-win-over-exxon-shows-activist-hedge-funds-joining-fight-against-climate-change-159983
desjardins
One of the most expensive Wall Street shareholder battles on record could signal a big shift in how hedge funds and other investors view sustainability.
Exxon Mobil Corp. has been fending off a so-called proxy fight from a hedge fund known as Engine No. 1, which blames the energy giant’s poor performance in recent years on its failure to transition to a “decarbonizing world.” In a May 26, 2021 vote, Exxon shareholders approved at least two of the four board members Engine No. 1 nominated, dealing a major blow to the oil company. The vote is ongoing, and more of the hedge fund’s nominees may also soon be appointed.
While its focus has been on shareholder value, Engine No. 1 says it was also doing this to save the planet from the ravages of climate change. It has been pushing for a commitment from Exxon to carbon neutrality by 2050.
As business sustainability scholars, we can’t recall another time that an energy company’s shareholder – particularly a hedge fund – has been so effective and forceful in showing how a company’s failure to take on climate change has eroded shareholder value. That’s why we believe this vote marks a turning point for investors, who are well placed to nudge companies toward more sustainable business practices.
Hedge funds to the rescue?
Climate strategies aimed at saving the planet are an odd play for a hedge fund. Such investment firms are better known for getting companies to stop investing in this type of thing so they can collect quick profits.
Recent research undertaken by one of us found that activist hedge funds tend to target companies that spend more of their resources on these types of sustainability initiatives. That is, they buy shares of a company to gain influence and then convince other investors to join them in demanding efficiency enhancements and cost-cutting protocols to return more cash to shareholders. A follow-up study found that companies cut spending on sustainability initiatives within five years of a hedge fund getting involved.
In other words, hedge funds focus on short-term returns – not long-term concerns such as climate change or even a company’s own future profitability. And this is because of how hedge funds fundamentally operate.
Hedge funds usually charge their investors – often wealthy individuals and institutional investors – a 1% to 2% management fee in addition to a 20% cut of any gain in their investments. In return, these clients expect quick and substantial returns that substantially outperform the market.
Engine No. 1, a new type of hedge fund?
This is what makes Engine No. 1’s fight so interesting.
It began in early December 2020, shortly after tech investor Chris James launched Engine No. 1 with two other hedge fund industry veterans. The firm said it was “purpose-built to create long-term value by harnessing the power of capitalism.”
Engine No. 1’s first order of business was to pick a fight with one of the world’s largest energy companies, Exxon Mobil. It sent a letter to the company’s board on Dec. 7, 2020, urging it to focus on clean energy and shake up its board of directors – a bold move for an upstart investment firm with just a 0.02% stake in the nearly US$250 billion company.
But Exxon was an obvious target for this strategy. It has been a laggard on developing low-carbon fuels for years and has promoted misinformation about the human impact on climate change for decades.
After Exxon refused to commit to a transition to carbon neutrality, Engine No. 1 formally launched its proxy battle in March to force a change of strategy at the company, which traces its history back to 1870, whenJohn D. Rockefeller founded the Standard Oil Compan**y.
A proxy battle is when a group of shareholders tries to garner enough support from other investors – in the form of votes – to force a company to do what it wants, whether it’s to cut costs or change strategy.
Exxon said it expected to spend $35 million more than its usual costs to deal with the proxy battle; unfortunately, by increasing Exxon’s expenses, these are costs that are actually footed by investors. Engine No. 1 put its expenses at $30 million. The total cost, by some estimates, has exceeded $100 million.
Engine No. 1 was hoping to replace a third of the oil giant’s board of directors with four individuals who have more clean energy experience. The hedge fund was also seeking corporate governance reforms, a review of Exxon’s climate action plan – and its impact on the company’s finances – and greater public disclosure of its environmental and lobbying activities.
Even before the vote, the campaign was already changing the way Exxon does business. In the past few months, Exxon has proposed a $100 billion carbon capture project in Houston and committed $3 billion to low-emission technologies through a new venture.
Though Exxon denies any of these investments were due to pressure from Engine No. 1, it’s hard to believe the hedge fund wasn’t a catalyst. These are some of the biggest investments Exxon has proposed in sustainability in recent years, and they came right after pressure from the hedge fund – as well as the election of a new U.S. president who has made fighting climate change a priority.
Another likely reason for the new initiatives is that Engine No. 1’s campaign was enlisting significant support from other major Exxon investors, such as the California Public Employees’ Retirement System and the New York State Common Retirement Fund, which laid additional pressure on Exxon to do something about its lagging sustainability strategy.
So despite its pushback against Engine No. 1 and its proposed climate plan, clearly Exxon Mobil’s attention to its sustainability plans has been piqued.
What it all means
So why is Engine No. 1 really doing this – and do its motives matter?
While the firm is pushing hard for more investment in sustainability and clean energy, the focus in its statements on what’s driving this fight is mostly about shareholder value. And many of its demands, such as better long-term capital allocation strategy, a plan to enhance shareholder value and a “misaligned” management compensation, are straight out of a typical hedge fund’s playbook.
What we see as fundamentally different here is the emphasis the hedge fund is putting on the connection between sustainability and long-term profits. It makes a strong case that the reason Exxon’s financial position has been deteriorating is because of its failure to invest in low-carbon technologies.
Or, like a hedge fund, Exxon has been focusing on the short-term gains from fossil fuels at the expense of its long-term future in a global economy that puts a premium on sustainability and a penalty on carbon-intensive activities.
Moreover, the readiness of so many major investors – including the three largest U.S. pension funds and BlackRock, the world’s biggest investment manager with $7.4 trillion in assets under management – in joining Engine No. 1 shows which way the winds are blowing, which Exxon seems to now also realize.
So the vote itself isn’t the story here. It’s that the weight of activist hedge funds – the most potent form of shareholder activism – seems to be shifting in favor of sustainability. As we see it, this means companies and executives that don’t invest in the transition low-carbon energy will increasingly risk incurring their wrath.
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bunch of hedge fund guys?
9/20
https://www.aei.org/about/board-of-trustees/
Board of Trustees, composed of leading business and financial executives.
Daniel A. D’Aniello, Chairman
:{:{Cofounder and Chairman}:
The Carlyle Group}:
Clifford S. Asness
Managing and Founding Principal
AQR Capital Management, LLC
The Honorable Richard B. Cheney
Peter H. Coors
Vice Chairman of the Board
Molson Coors Brewing Company
Harlan Crow
Chairman
Crow Holdings
Ravenel B. Curry III
Chief Investment Officer
Eagle Capital Management, LLC
Kimberly O. Dennis
President and CEO
Searle Freedom Trust
Dick DeVos
President
The Windquest Group
Robert Doar
President and Morgridge Scholar
American Enterprise Institute
Martin C. Eltrich III
Partner
AEA Investors LP
John V. Faraci
Retired Chairman and CEO
International Paper
Tully M. Friedman
Chairman and Co-CEO
FFL Partners, LLC
Christopher B. Galvin
Chairman
Harrison Street Capital, LLC
Harvey Golub
Retired Chairman and CEO, American Express Company
Chairman, Miller Buckfire
Robert F. Greenhill
Founder and Chairman
Greenhill & Co., Inc.
Frank J. Hanna
CEO
Hanna Capital, LLC
John K. Hurley
Founder and Managing Partner
Cavalry Asset Management
Joanna F. Jonsson
Partner
Capital Group
Bruce Kovner
Chairman
CAM Capital
Marc S. Lipschultz
Cofounder and President
Owl RockCapital Partners
John A. Luke Jr.
Chairman
WestRock Company
Pat Neal
Chairman of the Executive Committee
Neal Communities
Kevin B. Rollins
Retired CEO
Dell, Inc.
Matthew K. Rose
Retired CEO/Chairman
BNSF Railway
Edward B. Rust Jr.
Chairman Emeritus
State Farm Insurance Companies
Mel Sembler
Chairman Emeritus
The Sembler Company
Wilson H. Taylor
Chairman Emeritus
Cigna Corporation
William H. Walton
Managing Member
Rockpoint Group, LLC
Emeritus Trustees
Gordon M. Binder
Paul F. Oreffice
D. Gideon Searle
Henry Wendt
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https://www.alternet.org/2020/08/hedge-fund-3-billion-richer-thanks-to-wager-on-wildfire-insurance-claims-what-stage-of-capitalism-is-this
social and environmental toll of the unfolding fire catastrophe in California—where over 100,000 people have been displaced, seven have died, and approximately 1.2 million acres have burned since August 15—is incalculable, but hedge fund Baupost Group has found a way to turn the state’s devastating wildfire epidemic over recent years into profits for investors.
After wagering on insurance claims against PG&E, Baupost received more than $3 billion in July, Bloomberg reported Friday.
According to Bloomberg:
The payout yielded Baupost’s biggest profit generator last month and represented a sizable markup from what the firm had anticipated, it told investors Thursday. The fund bought $6.8 billion of subrogation claims against PG&E, court documents show.
Baupost acquired some of the claims at about 35 cents on the dollar, Bloomberg previously reported, so its profit on the trade could have approached $1 billion. But the gains were partly offset by losses on the firm’s equity holdings in the utility company, one of the people said, asking not to be identified because the information is private.
The relationship between PG&E, insurers, and investors such as Baupost began last year. PG&E’s electrical network—rendered vulnerable by a lackluster commitment to risk reduction—has been implicated in multiple fires across California in the past five years. Facing $30 billion in liabilities stemming from a series of fires in 2017 and 2018 that killed over 100 people and destroyed tens of thousands of buildings, the utility company declared bankruptcy in 2019 and announced an $11 billion settlement with a group of insurance carriers and investors, including Baupost.
insurers sell subrogation claims to investors at a discount because they enjoy the certainty of being paid right away, but in the process they also lose the right to sue to recuperate damages endured by policyholders.
While fire victims across California—and elsewhere in the country—continue to suffer the impacts of increasingly destructive wildfires, the ability of hedge funds to profit from such calamities provoked critics of the financial system and its perverse incentives. In his assessment of a situation in which Wall Street firms have perfected their lucrative approach to disaster management, journalist David Sirota tweeted:
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https://www.alternet.org/2020/08/elizabeth-warren-sounds-the-alarm-on-a-mounting-housing-crisis-and-the-profiteers-who-will-take-advantage/
During her 2020 presidential primary campaign, Sen. Elizabeth Warren had a lot to say about the United States’ housing crisis — and after suspending her campaign and endorsing former Vice President Joe Biden (now the presumptive Democratic nominee), the Massachusetts senator continued to address the subject. Warren, in an op-ed she wrote for the Washington Post with Carroll Fife (director of the Oakland office of the Alliance of Californians for Community Empowerment), stresses that the coronavirus pandemic has made a brutal housing crisis even worse. And private equity firms, according to Warren and Fife, are hoping to cash in on the misery by gobbling up “distressed real estate.”
“The nation is facing an acceleratinghousing crisis,” Warren and Fife warn. “Too many people had no stable housing before the pandemic hit, and COVID-19 has made the problem even worse. Renters who were already facing an affordable housing shortage — with many spending more than half of their income on rent — now have no federal rental assistance or federal protection from eviction. Homeowners have less than a month left of foreclosure protection. And more than 30 million people receiving unemployment insurance just saw their benefits cut by $600 a week, raising the threat of a wave of defaults that could trigger a double-dip recession.”
But while “families” see as a “looming catastrophe,” they add, “private equityfirms just see dollar signs.” And Warren and Fife cite a Wall Street Journal report that investors are hoping to buy “distressed real-estate assets at bargain prices.”
According to Warren and Fife, such “profiteering” is “straight out of private equity’s playbook during the 2008 financial crisis."
"Following the 2008 crash,” they explain, “corporations that grabbed up properties on the cheap, converted those homes into rentals and turned into the worst kind of slumlords — jacking up rents, neglecting maintenance requests and health and safety concerns, and eagerly assessing fines, fees and eviction notices. Other corporate-owned homes were left vacant in a hoarding of housing stock. We cannot stand by while this history repeats itself.”
Warren and Fife’s recommendations range from “strong federal legislation to guard against the coming wave of evictions and foreclosures, including emergency rental assistance” to preventing “predatory companies from further destabilizing neighborhoods and profiting off the displacement of families.”
“If we fail to prevent another private equity real estate grab,” Warren and Fife warn, “we risk allowing another massive upheaval in the housing market that could wreak more havoc on low-income Americans — especially black and brown families still recovering from losing their homes a decade ago. Against a decades-long backdrop of racist federal policies that have impeded black homeownership, lawmakers’ refusal to proactively address this problem would be an indefensible oversight that would again give Wall Street carte blanche to use a national crisis to enact a massive, generational transfer of wealth from vulnerable Americans to corporations."
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https://www.alternet.org/2020/07/very-problematic-fbi-says-private-equity-and-hedge-funds-pose-huge-risk-for-money-laundering
a leaked document reveals that the Federal Bureau of Investigation fears that the investment funds industry is a ripe target for money launderers, and could be a ticking time bomb in the private equity and the hedge fund sector.
In the leaked intelligence bulletin published in May under the title “Threat Actors Likely Use Private Investment Funds To Launder Money, Circumventing Regulatory Tripwires,” the FBI wrote that it has “high confidence” that “threat actors” could use “the private placement of funds, including investments offered by hedge funds and private equity firms, to launder money, circumventing traditional anti-money laundering programs.” The term “threat actors” refers to both hostile foreign powers and criminals attempting to make money.
The FBI notes that government law enforcement and watchdog agencies aren’t up to the task to suss out money laundering through the finance system in this way. “AML [anti-money laundering] programs are not adequately designed to monitor and detect threat actors’ use of private investment funds to launder money,” the report notes.
A hedge fund is a type of investment fund in which the managers trade in relatively liquid assets (or assets that can be bought and sold without a drastic change in their price) using various complicated techniques. Hedge fund management tends to be lucrative, regardless of whether an individual manager is actually successful, because the standard fee arrangement in the hedge fund industry is something known as “2 and 20.” Under that system, hedge fund managers take two percent of the money put up by an individual wealthy client, regardless of whether they successfully turn a profit off of those investments. When the investments are profitable, they then reap an additional 20 percent of those profits.
private equities are another type of investment fund. Whereas hedge funds trade in relatively liquid assets, however, private equities purchase and restructure companies which are not being publicly traded through methods such as leveraged buyouts, mezzanine capital, growth capital, venture capital and distressed investments. Private equities are controversial because they often inflate fees and expenses charged to companies in which they hold stakes, which means private equities can hurt individuals whose pension plans are invested in them or whose jobs depend on them through fee arrangements that allow the managers to make billions at the investees’ expense.
Hedge funds and private equity firms operate in a regulatory gray area, which makes them vulnerable to criminality, the FBI claimed:“Hedge funds and private equity firms receive funds from entities registered in nations that maintain laws conducive to masking underlying beneficial owners, thereby making it harder for US financial institutions and regulators to determine the source of funding.”
The report added that “hedge funds and private equity firms have been used to facilitate transactions in support of fraud, transnational organized crime, and sanctions evasion.” It cited as specific alleged examples a former partner at a major American law firm who “assisted others in laundering more than $400 million from a fraudulent cryptocurrency investment scheme,” a representative from a hedge fund based in London and New York who “proposed investing in private placement funds and using a series of shell corporations to purchase and sell prohibited items from sanctioned countries to the United States,” a Mexican cartel operating in southern California which “recruited and paid individuals to open hedge fund accounts at private banking institutions” and “a New York-based private equity firm [which] received more than $100 million in wire transfers from an identified Russia-based company allegedly associated with Russian organized crime.”
Hedge funds and private equities have been associated with a wide range of criminal behavior. Bernie Madoff, who was responsible for a $64.8 billion financial fraud that was exposed in 2008, ran a scam that involved feeder funds, which sends money to hedge funds that make investment decisions. Hedge funds have been previously criticized for not being required to fight money laundering. As Clark Gascoigne, deputy director of the Financial Accountability and Corporate Transparency Coalition, told ProPublica last year: “You’ve got several trillion dollars, the management of which nobody is required to ask any questions about where that money is coming from. This is very problematic.”
There are also occasions when hedge funds profit from a company’s failure: Empty creditors, or people who can be made whole through or even profit from credit default swaps, frequently have a financial incentive to let companies like the global tour operator Thomas Cook crash and burn, rather than try to save them.
Private equities are also rife with controversy. Last month President Donald Trump’s administration allowed large managers of 401(k) plans and individual retirement accounts (IRAs) to put workers’ retirement savings into private equity investments. Eileen Appelbaum, co-director of the Center for Economic and Policy Research (CEPR), warned thatAmerican workers have “socked away $6.2 trillion in 401(k) accounts and another $2.5 trillion in IRA accounts,” meaning that “if just 5 percent of the money in these retirement funds were available to private equity, it would be a windfall of $435 billion — real money even to private equity millionaires and billionaires.” Private equity firms have also been connected with thedownfall of companies like Toys R’ Us, RadioShack, Deadspin, Shopko and Payless Shoe
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https://www.alternet.org/2020/04/who-cares-let-em-get-wiped-out-stunning-cnbc-anchor-venture-capitalist-says-let-hedge-funds-fail-and-save-main-street/
no lnx
‘Who cares? Let ’em get wiped out’: Stunning CNBC anchor, venture capitalist says let hedge funds fail and save main street
Written by Common Dreams April 10, 2020
Venture capitalist Chamath Palihapitiya stunned CNBC anchor Scott Wapner and generated widespread applause on social media by declaring in a television interview Thursday that the U.S. government should let hedge funds and billionaire CEOs “get wiped out” by the coronavirus-induced economic collapse and instead focus its attention on rescuing Main Street.
“On Main Street today, people are getting wiped out. And right now, rich CEOs are not, boards that had horrible governance are not, hedge funds are not. People are.”
—Chamath Palihapitiya, CEO of Social Capital
When Wapner, seemingly incredulous at what he was hearing, asked Palihapitiya why he would support the collapse of large companies, the Social Capital CEO said “this is a lie that’s been purported by Wall Street.”
“When a company fails, it does not fire their employees, it goes through a packaged bankruptcy,” said Palihapitiya. “If anything what happens is the people who have the pensions inside the companies, the employees of these companies, end up owning more of the company. The people that get wiped out are the speculators that own the unsecured tranches of debt or the folks that own the equity. And by the way, those are the rules of the game. That’s right. These are the people that purport to be the most sophisticated investors in the world. They deserve to get wiped out.”
“Why does anybody ‘deserve,’ using your word, to get wiped out from a crisis created like this?” replied Wapner.
“Just be clear, like, who are we talking about?” said Palihapitiya, himself a billionaire. “A hedge fund that serves a bunch of billionaire family offices? Who cares? Let ’em get wiped out. Who cares? They don’t get to summer in the Hamptons? Who cares!”
After Wapner suggested it would be “immoral” to let any company get wiped out in the economic crisis, Palihapitiya responded that “on Main Street today, people are getting wiped out.”
“And right now, rich CEOs are not, boards that had horrible governance are not, hedge funds are not. People are,” said Palihapitiya. “Six million people just this week alone basically saying, ‘Holy mackerel, I don’t know how I’m going to make my own expenses for the next few weeks, days, months. So it’s happening today to individual Americans. And what we’ve done is disproportionately prop up and protect poor performing CEOs, companies, and boards. And you have to wash these people out.”
“This guy is great, hilarious, and right,” tweeted Matt Bruenig, founder of the People’s Policy Project, “though it is better to wipe them out through equity dilution (bailouts-for-equity) than through bankruptcy restructuring.”
Watch the full interview:
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omfg fire whistleblower
https://www.alternet.org/2020/04/heres-what-wall-street-doesnt-want-you-to-know-about-its-grip-on-emergency-rooms/
no lnx
Here’s what Wall Street doesn’t want you to know about its grip on emergency rooms
Written by Eileen Appelbaum, Rosemary Batt / Independent Media Institute April 3, 2020
Doctor Ling Min is the first emergency room doctor to be fired for going public with his concerns about poor hospital emergency room safety practices and shortages of medical supplies and protective gear for health workers.
He won’t be the last.
Like many hospitals in the US, PeaceHealth St. Joseph Medical Center in Bellingham Washington, where Ling Min worked for the past 17 years as an emergency room doctor, has outsourced the management and staffing of its emergency room.So, Min works on-site at the hospital’s ER, but he is employed by a physician staffing firm that runs the ER. These staffing firms are often behind the surprise medical bills for ER services that patients receive after their insurance company has paid the hospital and doctors, but not the excessive out-of-network charges billed by these outside staffing firms.[huh?]
About a third of hospital emergency rooms are staffed by doctors on the payrolls of two physician staffing companies—TeamHealth and Envision Health—owned by Wall Street investment firms. Envision Healthcare employs 69,000 healthcare workers nationwide while TeamHealth employs 20,000. Private equity firm Blackstone Group owns TeamHealth, Kravis Kohlberg Roberts (KKR) owns Envision.
Care of the sick is not the mission of these companies; their mission is to make outsized profits for the private equity firms and its investors. Overcharging patients and insurance companies for providing urgent and desperately needed emergency medical care is bad enough. But it is unconscionable to muzzle doctors who speak out to advocate for the health of their patients and co-workers during the global pandemic that is rapidly spreading across the US.
Yet, that is what Blackstone-owned TeamHealth just did. Why would an experienced ER doctor be fired in the middle of a pandemic? One clue may be that Blackstone’s CEO, Stephen A. Schwarzman, is part of President Trump’s inner circle. He may not want to risk that relationship by allowing TeamHealth’s doctors to inform the public about Washington’s mishandling of the allocation of supplies and protective gear. The president might conclude that TeamHealth doctors didn’t appreciate him enough, and where would that leave Schwartzman?
PeaceHealth St. Joseph Medical Center may have the distinction of being the first hospital to have a doctor outsourced from a physician staffing firm unceremoniously fired for telling the public the truth. But it won’t be the last. Hospitals are now telling doctors treating coronavirus patients they will be fired if they speak to the press.
The American Academy of Emergency Medicine protested Dr. Min’s ouster and questioned how TeamHealth is allowed to provide hospital services when the law requires that physician practices must be owned by a licensed medical practitioner. TeamHealth skirts the law by owning all the assets of the physician practices it acquires—the real estate, offices, equipment, supplies, inventory, and even accounts receivable.
On paper, the physician practices are owned by a doctor-led organization that TeamHealth has set up to comply with the law. But what does it mean to own a physician practice if the practice has no assets and no possibility to exist on its own?
The furor over patients hit by surprise medical bills revealed that TeamHealth controls the billing for the doctors it supplies to hospital emergency rooms. The firing of Doctor Ling Min pulls back the curtain and reveals that TeamHealth controls the doctors as well.
Eileen Appelbaum is the Co-Director of the Center for Economic and Policy Research and visiting professor, School of Management, University of Leicester, UK.
Rosemary Batt is the Alice Hanson Cook Professor of Women and Work, Cornell University ILR School.
This article was produced by Economy for All, a project of the Independent Media Institute.
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rental housing becomes the next bubble gt recession CDS? blackstone
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https://www.reuters.com/article/us-global-housing-rights/global-investors-wreaking-havoc-on-low-income-renters-u-n-says-idUSKCN1R71L5
3/19
(Thomson Reuters Foundation) -Large investment firms are worsening global housing shortages by forcing vulnerable out of low-income homes and upgrading them for higher rents, said United Nations human rights experts, who appealed to countries to tighten up regulation.
These firms had become the world’s biggest landlords, and “converted homes into financial instruments and investments”, said Leilani Farha, U.N. Special Rapporteur on the right to adequate housing, in a statement released Tuesday.
“Landlords have become faceless corporations wreaking havoc with tenants’ right to security and contributing to the global housing crisis,” she said.
Farha and Surya Deva, chairman of the U.N. Working Group on business and human rights, wrote to Blackstone Group LP, the world’s largest private equity firm, and authorities in Denmark, Ireland, Spain, Sweden, the United States and Czech Republic.[have laws that req action; US not sign treaties/agreement int'l]
Preferential tax laws and weak tenant protections in these countries have left vulnerable communities at risk of eviction and homelessness, they said.
“We remind all States, that while gold is a commodity, housing is not, it’s a human right,” they said.
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cooperman hedge fund former GS
https://www.alternet.org/2019/11/billionaire-curses-out-elizabeth-warren-to-a-reporter-over-her-powerful-new-ad/
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CEOs of major companies who donate to abortion ban politicians.
Check out other recent posts on Eyes on the Ties,including an expose on the hedge fund-backed thing tank that published a blog post sympathizing with the killer of the Christchurch attack (our post invited a response from the powerful Partnership for NYC) and our piece on the major banks and hedge funds that sponsored an NYC awards ceremony for Brazil’s far-right president, Jair Bolsonaro (under pressure, Bolsonaro canceled his trip to the event).
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Wendy’s & Wall Street + Millionaire CEOs propping up abortion ban politicians
LittleSis research analyst Derek Seidman profiled Trian Partners, the powerful hedge fund behind Wendy’s, and its billionaire CEO Nelson Peltz, who refuses to meet the modest demands of the Coalition of Immokalee Workers. The article - written for Truthout and reposted at Eyes on the Ties - went viral and was shared over 80,000 times on Facebook alone, making it one of our most widely-read stories ever. (Check out what the Coalition of Immokalee Workers had to say about the article here).
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http://hedgeclippers.org/
whistle blow
Instead of draining the swamp, Donald Trump brought it into the White House. Members of Trump’s inner circle include Wall Street billionaires with a history of destroying jobs, harming working people, and protecting the wealthiest Americans at everyone else’s expense. Hedge Clippers unites organizations and movements to cut through Trump’s swamp, and blow the whistle on Trump’s advisors who put their own financial gain before the public good. We’re giving Americans the tools and infrastructure to fight, and win, a multi-year battle against Trump’s agenda in Washington, and in states, cities, and towns across America.
The Hedge Clippers campaign includes leadership and collaborative contributions from labor unions, community groups, coalitions, digital activists and organizing networks around the country, including the Strong Economy for All Coalition, New York Communities for Change, Alliance for Quality Education, VOCAL-NY and Citizen Action of New York; Make the Road Connecticut; New Jersey Communities United; the Alliance of Californians for Community Empowerment (ACCE) and Courage Campaign; the Grassroots Collaborative in Illinois; the Ohio Organizing Collaborative; ISAIAH in Minnesota; Organize Now in Florida; Rootstrikers, Every Voice, Color of Change, 350.org, Greenpeace, the ReFund America Project and United Students Against Sweatshops; the Center for Popular Democracy and the Working Families Party; the United Federation of Teachers and New York State United Teachers; the American Federation of Teachers, the National Education Association, and the Communication Workers of America.
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World May Hit 2 Degrees of Warming in 10-15 Years Thanks to Fracking, Says Cornell Scientist
In 2011, a Cornell University research team first made the groundbreaking discovery that leaking methane from the shale gas fracking boom could make burning fracked gas worse for the climate than ...
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https://www.ecowatch.com/wall-street-fracking-revolution-2566742237.html
How Wall Street Enabled the Fracking 'Revolution' That's Losing Billions
By Justin Mikulka
The U.S. shale oil industry hailed as a "revolution" has burned through a quarter trillion dollars more than it has brought in over the last decade. It has been a money-losing endeavor of epic proportions.
In September 2016, the financial ratings service Moody's released a report on U.S. oil companies, many of which were hurting from the massive drop in oil prices. Moody's found that "the financial toll from the oil bust can only be described as catastrophic," particularly for small companies that took on huge debt to finance fracking shale formations when oil prices were high.
And even though shale companies still aren't turning a profit, Wall Street continues to lend the industry more money while touting these companies as good investments. Why would investors do that?
David Einhorn, star hedge fund investor and the founder of Greenlight Capital, has referred to the shale industry as "a joke."
"A business that burns cash and doesn't grow isn't worth anything," said Einhorn, who often goes against the grain in the financial world.
Aren't investors supposed to be focused on putting money toward profitable companies? While, in theory, yes, the reality is quite different for industries like shale oil and housing.
If the U.S. financial crisis of 2008 has revealed anything, it is that Wall Street isn't concerned with making a "shitty deal" when it means profits and bonuses for its traders and executives, despite their roles in the crash.
Wall Street makes money by facilitating deals much like a Vegas bookie makes money by taking bets. As the saying about Las Vegas goes: "The house always wins." What's true about casinos and gambling also holds true for Wall Street.
Wall Street caused the 2008 financial crisis, with some of its architects personally benefiting. However, while a few executives profited, the result was a drop in employment of 8.8 million people, and according to Bloomberg News in 2010, "at one point last year [2009] the U.S. had lent, spent or guaranteed as much as $12.8 trillion to rescue the economy."
JP Morgan (along with much of Wall Street) required large sums of money in the form of bailouts to survive the fallout from all of the bad loans made, which brought about the housing crisis. Is JP Morgan steering clear of making loans to the shale industry? No. Quite the opposite.
As shown in this chart of which banks are loaning money to shale company EOGResources, while all of the big players in Wall Street are in on the action, JP Morgan has the biggest bet.
To understand whyJP Morgan and the rest of these banks would loan money to shale companies that continue to lose it, it's important to understand the gambling concept of "the vigorish" or the vig. Merriam-Webster defines vigorish as "a charge taken (as by a bookie or a gambling house) on bets."
Wall Street makes money by taking a cut of other people's money. To a gambling house, it doesn't matter if everyone else is making money or losing it, as long as the house gets its cut (the vig)—or as it's known in the financial world—fees.
Understanding this concept gives insight into why investors have lent a quarter trillion dollars to the shale industry, which has burned through it. If you take the vig on a quarter trillion dollars, you have a big pile of cash. And while those oil companies may all go bankrupt, Wall Street never gives back the vig.
Trent Stedman of the investment firm Columbia Pacific Advisors LLC explained to The Wall Street Journal at the end of 2017 why shale producers would keep drilling more oil even when the companies are bleeding money on every barrel produced:
"Some would say, 'We know it's bad economics, but it's what The Street wants.'"
And "The Street" generally gets what it wants, even when it is clear that loaning money to shale companies that have been losing money for a decade and are already deep in debt is "bad economics." But Wall Street bonuses are based on how many "fees" an employee can bring to the bank. More fees mean a bigger bonus. And loans—even ones that are clearly bad economics—mean a lot more fees.
Shale Oil Companies Are "Creatures of the Capital Markets"
In 2017 "legendary" hedge fund manager Jim Chanos referred toshale oil companies as "creatures of the capital markets," meaning that without Wall Street money, they would not exist. Chanos is also on record as shorting the stock of heavily leveraged shale oil giant Continental Resources because the company can't even make enough money to pay the interest on its loans.
And he has a point. In 2017 Continental spent $294.5 millionon interest expenses, which is approximately 155 percent of its 2017 adjusted net income generation. When you can't even pay the interest on your credit cards, you are broke.
And yet in 2017, investor capital was still flowing, with Continental Resources among those bellying up to the Wall Street trough for another billion in debt.
"In 2017, U.S. [exploration and production] firms raised more from bond sales than in any year since the price collapse started in 2014, with offerings coming in at around $60 billion — up nearly 30 percent from 2016, according to Dealogic. Large-cap players like Whiting Petroleum, Continental Resources, Southwestern, Noble, Concho and Endeavor Energy Resources each raised $1 billion or more in the second half of 2017."
How big of a problem is this business of loaning money to an industry burning through billions and burying itself in debt? So big that the CEO of shale company Anadarko Petroleum is blaming Wall Street and asking its companies to please stop loaning money to the shale oil industry. Yes, that's right.
In 2017, Anadarko CEO Al Walker told an investor conference that Wall Street investors were the problem:
"The biggest problem our industry faces today is you guys. You guys can help us help ourselves. It's kind of like going to AA. You know, we need a partner. We really need the investment community to show discipline."
The Wall Street Journal reported that Walker maintains: "Wall Street has become an enabler that pushes companies to grow production at any cost, while punishing those that try to live within their means."
Imagine begging banks to stop loaning you money. And being ignored.
Growing production at any cost is the story of the shale "revolution." The financial cost paid so far has been the more than $280 billion the industry has burned through—money that its companies have received from Wall Street and, despite the plea from Al Walker, continue to receive.
The Economist summarized the situation in 2017:
"It [the shale industry] has burned up cash whether the oil price was at $100, as in 2014, or at about $50, as it was during the past three months. The biggest 60 firms in aggregate have used up $9 billion per quarter on average for the past five years."
Higher oil prices are now being touted as the industry's savior but, as The Economist noted, the shale industry was losing money even when oil was $100 a barrel.
Still Wall Street keeps giving the shale industry money and the shale industry keeps losing it as it ramps up production. To be clear, this arrangement makes shale company CEOs and financial lenders very rich, which is why the trend is likely to continue. And why Continental Resources CEO Harold Hamm will continue to repeat the myth that his industry is making money, as he did at the end of 2017:
"For anybody to even put forth the suggestion we haven't had great expansion and wealth creation in this industry with horizontal drilling and all the technology that's come about the last 10 years, I mean, it's totally ridiculous."
No one will argue that Hamm and his partners on Wall Street are not extremely wealthy. That has happened despite Hamm's company and the rest of the fracking industry losing epic sums of money. The same year Hamm made that statement, his company couldn't even cover its interest expenses. To put that in perspective, Continental Resources couldn't even make the equivalent of the minimum payment on its credit card.
Watch What the Industry Does, Not What It Says
Higher oil prices are yielding more storiesabout how 2018 will be the year that the shale industry finally makes a profit. Harold Hamm refers to it as Continental Resources' "breakout year." Interesting how potentially not losing money for a year is considered a "breakout year" in the shale industry.
As reported on DeSmog, the industry certainly got a huge boost from the recenttax law,which will help its companies' short-term finances. Continental Resources alone took home $700 million in tax relief.
Recent reports in the financial press detail how the new approach in the shale industry will be to focus only on profitable oil production, not just producing more barrels at a loss. As The Wall Street Journal put it in a headline: Wall Street Tells Frackers to Stop Counting Barrels, Start Making Profits.
In that very article, Continental CEO Hamm assures that he is on board with this new approach, saying, "You are really preaching to the choir."
But has Continental actually embraced this new approach of fiscal responsibility and restraint?
Not so much.
The fracking firm appears to have done the opposite, increasing production to record levels along with the rest of the shale industry. Continental recently reported plans to drill 350 new wells at an estimated cost of $11.7 million per well, which adds up to over $4 billion in total costs on those wells. The company currently holds more than $6 billion in debt and less than $100 million cash.
How will Continental fund those new wells? Hamm has promised that going forward, there would be "absolutely no new debt." Perhaps Continental will fund it by selling assets because without more debt, Continental does not have the money to fund those new wells. However, if past is prelude, then Wall Street will happily lend Continental as much money as it wants.
Why would Hamm say one thing and do another? Well, he personally has accrued billions of dollars while his company has burned through billions.
Despite leading Continental to another money-losing year in 2017, Hamm took home a fat raise.
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DIVEST now a legal strategy?
Bevis Longstreth, a former SEC commissioner, says his new proposal to state attorneys general for an "interpretive release" and guidance on climate-related risk could open the floodgates of divestment from coal, oil and gas companies
The money managers of university and non-profit endowments owe a debt of gratitude to a lawyer named Bevis Longstreth. He's hardly a household name, but an obscure book he published 30 years ago provoked a modernization of the legal definition of prudent investing that changed their lives for the better.
His work opened the door for trustees of non-profits to make investments that are now at the heart of modern portfolio management. Previously they were out of bounds because they were considered too risky.
"Imagine all the pension funds in this country, and all the institutions like Yale and others, they are all deeply invested in hedge funds," Longstreth said. "When I wrote that book it would have been impossible for them to invest in a hedge fund."
Now Longstreth, 82, is out to rock the world of non-profit money managers again. This time he doesn't have a book, but merely a six-page argument.
His proposal calls for a legal reinterpretation of what constitutes prudent management of institutional funds now that the investment landscape is filled with new risks for fossil fuel investors.
With the world heading toward zero carbon emissions after the signing of the Paris agreement, Longstreth thinks it's time for some fresh guidance.
To that end, he's working channels to convince various attorneys general to spell out those risks in an "interpretive release," and offer guidance on how to handle them. He thinks the attorneys general of New York, Massachusetts and California will be most receptive to his proposal.
If the guidance is published, Longstreth says, it could open floodgates of divestment from coal, oil and gas companies. That's because, as he explains in the extensive interview below, it can't be ignored.
Every state in the union (except Pennsylvania and the territory of Puerto Rico) has its own version of the uniform law governing investments by trustees, known by the acronym UPMIFA. And each attorney general has power to issue guidance on how to exercise prudence under that uniform law.
The question remains whether any attorney general would offer guidance singling out a particular asset class.
Though retired from legal practice and now a three-time novelist, Longstreth brings considerable experience to his latest legal rethink. He was twice appointed by President Ronald Reagan to serve as commissioner of the Securities and Exchange Commission. For decades he was a securities lawyer and partner at Debevoise & Plimpton, a prominent international firm.
He wears wire-rimmed glasses, carries degrees from Princeton (B.S. 1956) and Harvard (LL.B 1961), and has a careful manner of choosing words precisely.
We spoke with Longstreth about his career, his latest legal effort, and how it could provoke change.
ICN: Your career included being a commissioner of the SEC. How were you chosen and how would you characterize your tenure?
Longstreth: I served in the SEC from 1981-1984. I was appointed by President Reagan to a shortened term to fill out somebody who had retired, and then Reagan reappointed me to occupy a Democratic seat on the commission. I think for President Reagan I was not an obvious choice, given my political background, but I was chosen because Jim Baker [Reagan's former chief of staff] wanted me there.
http://insideclimatenews.org/news/07062016/retired-lawyer-boris-longstreth-floodgates-divestment-fossil-fuels-climate-change-investments
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CHARTER SCHOOL REFORMhttp://www.prwatch.org/news/2016/03/13065/how-dfer-leaders-channel-out-state-dark-money-colorado-and-beyondNot only is DFER led by Democrats who have failed to win their last elections, a number of DFER-backed candidates have lost in recent elections, as with the Colorado school board races in 2015.On the other hand, DFER spent more than $4 million on TV ads in 2010 that attempted to blame New York teachers’ unions for problems caused by the disastrous federal "Race to the Top" program. Among other things, DFER also spent $1 million on ads attacking the Chicago Teachers Union and supporting Rahm Emanuel in 2012. Who Funds DFER? "Education Reform Now Advocacy" and Its (Hedge) FundersDFER is actually the more well known PAC arm of Education Reform Now, Inc. (ERN), a 501(c)(3) charitable nonprofit, and Education Reform Now Advocacy, Inc. (ERNA), a 501(c)(4) social welfare group. Their acronym not only sounds like the word "earn," but also it has the backing of some really huge earners. DFER co-founder (and founder of the T2 Partners hedge fund) Whitney Tilson explained the hedge funders interest in education noting that “Hedge funds are always looking for ways to turn a small amount of capital into a large amount of capital.” The Board of Directors for ERN consists almost entirely of Wall Streeters who made their fortunes through financial groups and hedge funds, such as Sessa Capital, Gotham Capital, Covey Capital, Charter Bridge Capital, Maverick Capital, Cubist Systematic Strategies, and Sanford C. Bernstein.As the New York Times reported: DFER's supporters have included "the founders of funds like Anchorage Capital Partners, with $8 billion under management; Greenlight Capital, with $6.8 billion; and Pershing Square Capital Management, with $5.5 billion."However, ERN and ERNA do not disclose who its major donors are and how much those big donors give to fund its operations and ambitions.It is known, though, that FOX's Rupert Murdoch gave at least $1 million to ERN. Murdoch has expressed his desire to get in on education "reforms," stating "When it comes to K through 12 education, we see a $500 billion sector in the U.S. alone...."The most recent federal tax filings of ERN/ERNA show that it had more than $12 million available to push education reform ($7.4 million for ERN and $5 million for ERNA) in 2013. Its non-profit filings from the most recent major election year, the 2014 mid-terms, or last year are not available.What is known from the 2013 is filings is that, in that year, ERNA disclosed that it spent $1.7 million in political expenditures, nearly all of which went to DFER. These funds were used for expenditures, like mass mailings or ads supporting particular politicians but that were "independent" and not to be coordinated with the candidates' campaigns. ERN/ERNA's leader Joe Williams has been paid a for-profit like salary as its executive, with $398,500 in total annual compensation in 2013. He's also listed as "Executive Director Emeritus" for DFER and on DFER's board. Williams stepped down from his staff position at DFER in 2015 and also became a director at the Walton Education Coalition that year. That's Walton as in Walmart's Walton family. Because non-profits like ERN/ERNA do not have to disclose their major donors to the public, even when ERNA is active in supporting electoral activities the public is left in the dark about which hedge funder is actually helping to fund state and local ads and mailers during the election.Even though privately held corporations and hedge funders do not have to disclose their donations to operations like ERN/ERNA, a CEO's charitable foundations do have to disclose whom they give grants to.That's how it is known that the Walton family, of Walmart fame or infamy, has backed such efforts. In 2011, for example, ERN/ERNA received $1.1 million from the Walton Family Foundation. The total amount from all such CEO-controlled foundations given to ERN/ERNA to date is not known. As Matthew Fleischer noted in the Frying Pan News (reprinted by the Huffington Post) that hedge funder Tilson has followed the Waltons' lead: "in a 2010 documentary, A Right Denied, Tilson suggested that DFER was created because of Walmart patriarch John Walton’s support of vouchers and "school choice.'"It has been investigative journalists who have helped expose the billionaire network behind ERN/ERNA/DFER, despite the opacity on the surface, as noted by George Joseph in the Nation: