Finance

Michael P. Regan is a Bloomberg Gadfly columnist covering equities and financial services. He has covered stocks for Bloomberg News as a columnist and editor since 2007. He previously worked for the Associated Press.

All available evidence seems to signal that most of Wall Street fell asleep while listening to banks' earnings conference calls this week. 

Furthermore, the relevant data suggests that many of those sleepy heads fell onto the keyboards in front of them and accidentally hit the "buy" button. How else could you explain the performance below? (Seriously, how would you explain it?)

Earnings, Schmearnings
Bank stocks posted big gains this week even after reporting declines in quarterly profit
Source: Bloomberg.
Note: Weekly share-price moves are as of mid-morning Friday.

If this situation applies to you, congratulations on your new stake in one of America's too-big-to-write-a-will lenders. And here's a recap of the most interesting financial news you may have missed while you snoozed. 

If you wrote a living will for Steven Cohen's career managing other people's money, we're sorry, but it's no longer credible. The bad-boy rock star of the hedge-fund world is getting the band back together, as Miles Weiss reported, though his deal with The Man precludes him from playing lead guitar (at least temporarily, presumably). 

Cohen's fund will be called Stamford Harbor Capital, and we could make a cheap joke speculating on who exactly is being harbored, but we're above that. Instead, the name is an homage to a cluster of docks favored by many of Connecticut's well-heeled enthusiasts of the nautical arts. We will, however, point out the obvious connection between the name and another interesting piece of news this week: the Wall Street Journal's scoop revealing how technology has finally made it possible to trade while riding on a speedboat.  

As John Prine crooned, "It's a big old goofy world," and you don't have to tell that to the big old goofy macro hedge funds that are having a hard time navigating the shifting tectonic plates of our big old goofy global markets. The latest to show signs of pain is Paul Tudor Jones, whose firm is "one of the oldest and well regarded," as Simone Foxman reports. Whatever, say investors, who are yanking more than $1 billion after a few disappointing years, no longer impressed by the 36 percent Tudor’s Tensor Fund pulled from markets in 2008 when the S&P 500 went a similar distance in the opposite direction. 

Loyalty to a fund manager has an expiration date, and Tudor's investors surely aren't the only ones sniffing the milk these days. As that article noted, the average macro fund has trailed the S&P 500 since 2009 and was positive in only one of the last five years. Plenty of ink has been spilled on theories explaining why, so let's not waste much more here. Suffice it to say our guess is that when it comes to strategies, computers and competition have collapsed the time gap between the "Eureka! It works!" moment and the "Well, it was good while it lasted" moment to a blink. Another example of black eyes for the hedge-fund old guard include news that New York's civil employees' $154.4 billion pension fund is considering pulling the plug on some alternative managers, which include D.E. Shaw and Brevan Howard.

Speaking of black eyes, congratulations to exchange operator Bats Global Markets for getting its stock trading on its own exchange in Friday's IPO! An embarrassing software bug forced Bats to cancel its first crack at an IPO in 2012, which would have also marked the firm's first company stock listing. (I was an editor back then and my -- arguably overused -- catchphrase for this and other electronic trading glitches was "the latest black eye" for Bats or whoever just got punched, so it's only fair to acknowledge when those shiners have healed.)  

There was a bit of a hubub over just how impressive the past two decades of venture capital returns were for Yale's endowment, which is run by David Swensen, who could be known as the Michael Jordan of endowment investing if he wasn't already famous for being the David Swensen of endowment investing. The returns were either 93 percent (on an internal rate-of-return basis) or 33 percent (on a time-weighted basis). We could go into further detail, but fear we'd put you to sleep and your head would land on the "donate to Yale" button, and Zeus knows they don't need it. All that matters is Yale's returns are still kicking Harvard's in the buttocks, but don't worry all you Cantabrigians because Bill Ackman is on the case.

Speaking of Ackman, he got a nod of support from none other than Bill Miller -- known as the "Bill Miller of mutual-fund investing" -- when the old Legg Mason legend bought shares of Valeant. They perked up for a few glorious moments, but then retreated. 

Bill Who?
Valeant got a pop Thursday from news that Bill Miller was buying shares, but the euphoria faded
Source: Bloomberg
Note: Intraday chart for April 14

Clearly, the initial reaction shows someone forgot to update their headline-reading algorithms to account for Miller's recent returns. Or maybe they just nodded off.

Their bank-following brethren can commiserate, awaking just in time to collect their Trade of the Week award.   

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story:
Michael P. Regan in New York at mregan12@bloomberg.net

To contact the editor responsible for this story:
Daniel Niemi at dniemi1@bloomberg.net