CFA Society Chicago NewsBrief
Jul. 29, 2014

It's not just Janet Yellen: Richard Fischer misses the point of monetary policy too
Forbes
In congressional testimony, newly minted Fed Chairman Janet Yellen ably revealed why the central bank she runs is often such an imposing barrier to economic progress. While it will be explained later in the piece why Yellen will ultimately have a successful Fed tenure in a debased, “soft bigotry of low expectations” sense, her testimony makes clear that she’ll succeed despite her impressive weakness as an economic thinker.More

Advice on alternative investments
CFA Chicago
Mario Gabelli, CFA is Chairman, Chief Executive Officer of GAMCO Investors, Inc., a New York Stock Exchange listed company that is a widely recognized provider of investment advice to alternative investments, mutual funds, institutional and private wealth management. GAMCO Investors, Inc. is listed on the New York Stock Exchange. Gabelli founded the firm in 1977 as an institutional broker-dealer. It has grown into the diversified financial services corporation it is today. Join CFA Chicago on Tuesday, August 12 at 12 p.m. for the Distinguished Speaker Series featuring Gabelli.More

Take the time to give back
CFA Chicago
Family Focus helps Chicago-area families living in low-income communities give their children the best possible start in life. By offering customized classes, support groups and referral services in a welcoming and caring environment, Family Focus helps families help themselves while building a relationship based on equality and respect. On Thurs., Aug. 14, CFA Chicago is hosting a Summer Networking Reception at Hotel Palomar (Fresco Terrace) to support Family Focus.More

Finding value in energy with Morningstar's Jason Stevens
CFA Institute's Enterprising Investor
At the 2014 CFA Institute Financial Analysts Seminar, energy analyst Jason Stevens of Morningstar shared his views on the shale gas and tight oil revolution, which has been driven by fracking, the combination and application of horizontal drilling and hydraulic fracturing that has unlocked the vast potential of trapped oil and gas. During his presentation, Stevens discussed which companies and countries are best positioned to make full use of that potential.More

Meet Chicago's first 'enlightened' hedge fund. Yes, enlightened
Crain's Chicago Business
There's no CEO or dress code. But there is a feng shui consultant and nostalgia for the early days of the hedge-fund craze. No reception desk or smiling gatekeeper greets you at the entrance of Satori Investment Partners LLC's office. There is just one big, red Oriental rug, courtesy of the feng shui consultant who helped the new hedge-fund firm incorporate the five Zen elements into its office.More

Fewer than 3 percent of nation's banks are minority institutions
Chicago Tribune
Fewer than 3 percent of the nation’s 6,730 banks are minority institutions, but that’s still a bigger percentage than a decade ago, according to a study released by the Federal Deposit Insurance Corp. The FDIC defines a “minority depository institution” as one in which at least 51 percent of the bank’s stock is owned by black Americans, Asian Americans, Hispanic Americans or native Americans. An institution can also receive the designation if most of its board members are minority, and if the community that it serves is mostly minority.More

Firms say new SEC scrutiny may further complicate co-investments
Private Equity Beat
Some private equity managers, facing the prospect of more scrutiny from the Securities and Exchange Commission on how co-investment opportunities are spread between limited partners, caution that additional regulation could pose more challenges to a process that already is difficult to streamline. Andrew Bowden , director of the SEC’s office of compliance inspections and examinations, said limited partnership agreements the federal agency observed lacked clear “protocols for mitigating certain conflicts of interest, including investment and co-investment allocation” in a speech in New York in May.More

The right way to invest globally
The Wall Street Journal
Investors are going to the ends of the earth. Shares of foreign companies are making up an increasingly large chunk of U.S. investors' stock portfolios, as barriers to investment fall, global economies integrate and the potential benefits of international diversification are widely embraced. More than a quarter of the money in U.S. equity mutual funds and exchange-traded funds is in foreign-stock-focused funds, up from 14 percent in 2000, according to the Investment Company Institute, a trade group.More

Source: Goldman mortgage deal with federal agency could reach $1.25 billion
Reuters via Chicago Tribune
A deal to resolve a U.S. regulator's claims against Goldman Sachs Group Inc over mortgage-backed securities sold to Fannie Mae and Freddie Mac leading up to the financial crisis could cost the bank between $800 million and $1.25 billion, according to a person familiar with the matter. The person said Goldman Sachs is discussing a settlement with the Federal Housing Finance Agency (FHFA), which filed 18 lawsuits against Goldman and other banks in 2011 over about $200 billion in mortgage-backed securities that later went sour.More

Social impact bonds: Phantom of the nonprofit sector
Nonprofit Quarterly
What issue could bring Senator Ted Cruz, R-Texas, and Senator Al Franken, D-Minnesota, into bipartisan partnership? Social impact bonds (SIBs) — or pay-for-success (PFS), depending on one’s preferred terminology. Both legislators have been effusive about the reauthorization of the Workforce Innovation and Opportunity Act (WIOA), and Franken seems to have made workforce development one of his top priority issues. A core component of WIOA noted by many of its supporters was the legislation’s $300 million commitment to pay-for-success programming aimed boosting effective, evidence-based efforts in job training.More

GreenChoice Bank fails, Providence Bank is the buyer
The Associated Press via Crain's Chicago Business
Regulators have closed a small lender in Illinois, bringing U.S. bank failures this year to 14 after 24 closures in all of 2013. The Federal Deposit Insurance Corp. said that it has taken over GreenChoice Bank FSB, based in Chicago. The bank, which operated three branches, had about $72.9 million in assets and $71 million in deposits as of March 31. Providence Bank LLC, based in South Holland, has agreed to assume all of the failed bank's deposits.More

It's not just Janet Yellen: Richard Fischer misses the point of monetary policy too
Forbes
In congressional testimony, newly minted Fed Chairman Janet Yellen ably revealed why the central bank she runs is often such an imposing barrier to economic progress. While it will be explained later in the piece why Yellen will ultimately have a successful Fed tenure in a debased, “soft bigotry of low expectations” sense, her testimony makes clear that she’ll succeed despite her impressive weakness as an economic thinker.More

Here's who's winning Chicago's bank battle
Crain's Chicago Business
What a difference a financial crisis makes. In the seven years since the U.S. banking system teetered on collapse, Chicago's commercial banking industry has gone from a virtual duopoly to something of a free-for-all. For much of the 1990s and well into the first decade of the 2000s, LaSalle Bank and what is now JPMorgan Chase & Co. dominated the local market for serving midsized businesses — the bread and butter of Chicago business leMore

Northern Trust names first female COO
Chicago Tribune
Northern Trust Corp., Chicago’s biggest locally headquartered bank, has named its first female chief operating officer as part of a management shake-up effective Sept. 1. Jana Schreuder, 55, currently president of wealth management – one of Northern Trust’s two major business units along with corporate and institutional services — will assume the COO role, overseeing operations and technology teams. More