Monday, 23rd November 2009

 

14 August 2009 - Press Briefing

Berkshire admits 'underestimating’ risks to derivatives bets

Berkshire Hathaway underestimated the risks declining stock prices worldwide last year would have on the massive derivatives bets it had made on four key equity indices in the US, Japan and Europe, the firm confessed to the Securities and Exchange Commission, according to a report in The Daily Telegraph, London.

In a letter dated June 26 from Berkshire to the SEC, chief financial officer Marc Hamburg wrote that last year’s stock market falls of between 30% and 45% were “in excess of” of the firm’s assumed weighted volatility of 22%.

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Brummel

Relocation, relocation, relocation

Banks have never been shy of firing staff at the merest whiff of a downturn. First the fat, then the muscle and finally the bone. In the past, cuts have been so deep that firms have found it hard to benefit when the markets rebounded, paying over the odds to restaff at speed. Such wild oscillations in staffing numbers are known as “doing a Merrill”.

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