Even the CFO of HWP doesn't realize that the DB asset managers and the DB equity analysts have completely different jobs? The asset managers don't put any more faith in Elling than they do in any other brokerage house's research analyst. This seems evidence to me that people really don't understand how Wall Street works......
No...it's evidence that he knows how it really works! Maybe you have not been paying attention to New York Attorney General Eliot Spitzer's subpoenas but there has been a lot of concern that the investment banking and equity research sides of firms are too tightly coupled. "Give me your investment banking business and I'll give your stock a good analyst recommendation." You understand how it should work correctly...unfortunately that is not the real world!
story.news.yahoo.com
CSFB, a unit of Credit Suisse Group (CSR), is among a group of heavy hitters on Wall Street that
have been served subpoenas by New York Attorney General Eliot Spitzer as he investigates the
relationship between research departments and investment banking units when it comes to crafting
research reports.
Last week, Merrill Lynch & Co . (MER) reached an agreement to provide more disclosure in research
about its ratings system and possible investment banking conflicts. The agreement came after a
10-month investigation by Spitzer's office, that included the embarrassing disclosure of several e-mails
where analysts panned stocks they publicly praised.
However, the deal cut by Merrill and the attorney general's office is only a partial agreement. The firm
could face a fine or, possibly, criminal charges.
Other firms that have been served with subpoenas from Spitzer's office include Bear Stearns Cos
(NYSE: BSC - news) . (BSC), Goldman Sachs Group Inc. (GS), Lehman Brothers Holdings Inc.
(LEH), Morgan Stanley (MWD), Salomon Smith Barney, a unit of Citigroup Inc. (NYSE: C - news)
(C), and UBS Warburg, a unit of UBS AG (NYSE: UBS - news) (UBS). |
