abu yahya's definitions

covering shorts

(FINANCE) the situation in which a derivatives trader with a short position is wrong about the behavior of the market. Having sold shares of stock he doesn't own, he is now compelled to buy them at a higher price than he sold them for (in order to reimburse whomever he borrowed the shares from).

If the short position was taken by writing naked options (i.e., issuing call options of stock the trader doesn't happen to have), then the trader has to buy shares of underlying stock in order to honor the options.

It's extremely expensive for traders to have to cover their shorts.

The surprising stock rally came as a shock. Nicholas Leeson had been riding high, but now he was furiously covering shorts, and driving the share prices higher still. By closing bell, he was ruined.

by Abu Yahya May 5, 2010

Lusophonic

(ADJECTIVE) Portuguese-speaking; of or related to the Portuguese-speaking world

In order of population, the Lusophonic countries are Brazil, Mozambique, Angola, Portugal, Guinea-Bissau, Timor-Leste, Macau S.A.R., and São Tomé e Príncipe.

by Abu Yahya May 18, 2010

Carlyle Group

(FINANCE) largest private equity fund manager in the world, by assets under management ($90.5 billion-2010). The Carlyle Group is actually a group of 67 funds which are, in turn, managed by a wholly private (i.e., non-listed, non-traded) limited liability company (LLC). In order to be a partner in the Carlyle Group, one needs to (a) have an enormous amount of money to invest for a very long time, and (b) have some peculiar connection of value to the existing partners.

About 69% of fund commitments by TC Group, LLC, are for buyouts; the profits--which are immense--come when it resells its portfolio. For example, it bought and restructured United Defense Industries in 1997, cashed out by '04, and made profits of about a billion on that particular deal. It has bought many defense firms and restructured them, while using its special connections to open doors for new categories of defense contracts.

One major investor is Prince Al-Walid bin Talal, who is also the owner of the largest block of shares in News Corp outside of the Murdoch family.

The collection of influential characters who now work, have worked, or have invested in the Carlyle Group {include}... John Major, former British Prime Minister; Fidel Ramos, former Philippines President; Park Tae Joon, former South Korean Prime Minister; Saudi Prince Al-Walid bin Talal; Colin Powell; James Baker III; Caspar Weinberger; Richard Darman, former White House Budget Director; the billionaire George Soros, and even some bin Laden family members; Karl Otto Poehl, former Bundesbank president; the late Henri Martre, who was president of Aerospatiale; and Etienne Davignon, former president of the Belgian Generale Holding Company.
{"Carlyle Empire" by Eric Leser, Le Monde, April 29, 2004}

by Abu Yahya September 1, 2010

fiscal deficit

the gap between revenues and expenditures for a government (over a given period of time); often referred to as an internal deficit or public deficit.
The public deficit accumulates over each time period (usually a year) into what is known as the public debt.

According to Keynesian and Neo-Keynesian economic theory, fiscal deficits are usually the most effective tool for stimulating economic activity; the actual choice of how the money is spent is less important.

In the USA, most states are not allowed to run fiscal deficits. In other federal republics, such as India and Argentina, they are allowed and frequently account for much of those countries' internal deficits.

by Abu Yahya February 14, 2009

Hispanophonic

(ADJECTIVE) Spanish-speaking; of or related to the Spanish-speaking world.

The largest Hispanophonic countries, in order of population, are

Mexico (111,211,789)

Colombia (43,677,372)

Argentina (40,913,584)

Spain (40,525,002)

USA (35,000,000?)

Peru (29,546,963)

Venezuela (26,814,843)

Chile (16,601,707)

Ecuador (14,573,101)

Guatemala (13,276,517)

Cuba (11,451,652)

Bolivia (9,775,246)

The Dominican Republic (9,650,054)

Honduras (7,833,696)

El Salvador (7,185,218)

Paraguay (6,995,655)

Nicaragua (5,891,199)

Costa Rica (4,253,877)

by Abu Yahya May 18, 2010

U-3

(ECONOMICS) Total unemployed, as a percent of the civilian labor force (official unemployment rate). Does not include discouraged workers. Also referred to as "headline unemployment" because it is the statistic reported in the news.

The US Bureau of Labor Statistics regularly publishes six estimates of unemployment. The others are U-1, U-3, U-4, U-5, and U-6. Eurostat publishes one monthly estimate of unemployment for the European Union, which is approximately midway between U-3 and U-4.

The unemployment statistics for the USA are collected through a monthly Current Population Survey (CPS) (also known as the household survey) and an establishment survey.

U-3 is the official unemployment rate in the USA; it excludes passive jobseekers (people who are just looking for available job openings without applying). Passive jobseekers are counted as part of the labor force in Europe, but not in the USA. Prior to the 2008 economic crisis, this caused unemployment rates in the USA to be about 1% lower than they would have been if the BLS had used European methods of estimating.

by Abu Yahya July 17, 2010

Federal Reserve Bank of New York

(US ECONOMY) One of the 12 district Federal Reserve Banks. Based in New York (2nd FR district). Along with members of the Federal Reserve Board, enjoys a permanent seat on the FOMC (other district banks only get to rotate).

Main job is to regulate banks and administer monetary policy through open market operations. Former New York Fed president Tim Geithner is now Secretary of the US Treasury Department (as of early 2009).

Prior to 1928, the President of the Federal Reserve Bank of New York was the de facto leader of the entire system. This was because of the powerful personality and connections of Benjamin Strong, a former J.P. Morgan partner.

by Abu Yahya September 10, 2010