The Latest On The Market Turmoil

Reuters reports that JPMorgan Chase boss Jamie Dimon thinks that the economic crisis still has some way to go. He told German weekly newspaper Welt am Sonntag over the weekend that although 'we can only speculate how deep and how long the recession in the United States will really be and how in turn it will impact banks...we are not done with (this) crisis for a long time'.

Warren Buffett, however, thinks that Wall Street is over the worst. Speaking on Bloomberg TV over the weekend, Buffett said: 'The worst of the crisis in Wall Street is over. (However) in terms of people with individual mortgages, there's a lot of pain to come'. CNBC reports, however, that the smart money says that US financials are expected to see a 40% decline in earnings in the second-quarter.

In the meantime, The Financial Times reports that Buffett's Berkshire Hathaway took a $1.6bn non-cash hit in the first-quarter on derivatives contracts. The Sage once famously described derivatives as 'financial weapons of mass destruction'.

The Sunday Times reports that hedge funds are 'beginning to bet that shares in Britain's biggest banks have hit rock bottom', as traders have started to scale-back their short positions. And FT Alphaville reports that a growing number of hedge funds are trying to persuade investors to shell out for new funds by offering discounted fees.

Bloomberg reports, however, that Dresdner Kleinwort has come out and said that Barclays may well have to boost its balance sheet as it expects the bank to take an additional $6bn in asset writedowns. And The Sunday Telegraph reports that Barclays is said to have held secret talks with an investment fund backed by the Korean government about the possibility of a capital injection.

The New York Times reports that Citigroup is now restructuring its Old Lane hedge fund, the fund founded by now-Citi CEO Vikram Pandit. Virtually all the investors are now expected to exit the fund, which was said to be around 3% down in the first quarter.

The National Post reports that the Citigroup analyst who upset Royal Bank of Canada last week when she suggested that the bank would be looking at additional asset writedowns of some $5bn has gone back to her abacus. Shannon Cowherd has now halved her writedown projections on structured products to $2.6bn.

Finally, Bloomberg reports that the SWX Swiss Exchange has fined Societe Generale $28,630 for failing to maintain proper records of the activities of some of its traders and misusing trader identification numbers. Oh dear, something of a pattern is emerging here, non ?

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