Finance system “out of its mind”: France’s Sarkozy

NEW DELHI (Reuters) – French President Nicolas Sarkozy demanded changes to the running of international financial markets on Saturday in the wake of the fraud scandal at Societe Generale, which cost the French bank some $7 billion.

“We have to put a stop to this financial system which is out of its mind and which has lost sight of its purpose,” Sarkozy said on the second of a two-day visit to India.

“The point of a financial system is to lend money for economic activities, which, in turn, generate profits,” Sarkozy told a gathering of French nationals at the French embassy.

“It is not to go and speculate on different activities which create enormous flows and profits in a few hours,” he added.

“If one can make profits in a few hours, one can also make gigantic losses in a few hours as well. And it is time to realize that (we need) to insert a bit of wisdom into all these systems,” the president said.

Societe Generale said this week a rogue trader hid “massive fraudulent” positions in 2007 and 2008 on European equity market indices, which left it nursing 4.9 billion euros ($7.18 billion) of losses after deciding to unwind them in wildly turbulent markets.

The French government was only informed about the massive losses on Wednesday, but a source at the Elysee presidential residence said Sarkozy himself was warned of the problem on Tuesday.

Ministers have expressed anger in private about the delay in informing the government.

Sarkozy is due to hold talks with British Prime Minister Gordon Brown and German Chancellor Angela Merkel on Tuesday to discuss ways of improving the transparency of financial markets following the subprime credit crisis.

“I believe in the market economy, I believe in free trade, but I want a type of capitalism … where more place is given to the entrepreneur rather than the speculator,” the president said on Saturday. “Speculation does not create wealth.”

“It is now time to put transparency and prudent new rules into the global financial system … and to promote lending money to businesses and to those who create wealth rather than to those who want to buy in order to tear things apart and speculate,” he added.

(Reporting by Emmanuel Jarry, writing by Crispian Balmer; editing by Tony Austin)

Yann Tiersen is in Studio recording a new album

Tiersen was born in Brittany, France, in 1970 and received classical training at several musical academies, including those in Rennes, Nantes, and Boulogne. Before releasing scores under his own name, Tiersen recorded background music for a number of plays and short films, such as La Vie Rêvée des Anges (1998, Erick Zonca), Alice et Martin (1998, André Téchiné), Qui Plume la Lune? (Christine Carrière, 1999).

He rose to domestic fame upon the release of his third album, Le Phare, but remained relatively unknown outside France until the release of his score for Le fabuleux destin d’Amélie Poulain in 2001, which was a mixture of both new and previously released material.

Tiersen favors the piano, accordion, and violin, but is also known for his experimentation and use of obscure instruments like the ondes martenot and the typewriter.

Yann Tiersen’s list of collaborators continues to grow album after album (see discography below for details). While composing his fifth album, L’absente, Tiersen lent his musical talent to Françoiz Breut and Les Têtes Raides for their own albums. His 2005 album, Les Retrouvailles, featured vocals from Stuart Staples of Tindersticks, Jane Birkin, and Elizabeth Fraser, formerly of Cocteau Twins. Tiersen also played piano on Staples’ solo album, Lucky Dog Recordings 03-04.

His live performances vary greatly. Sometimes he is accompanied by an orchestra and many guest collaborators, like Dominique A. Others, he offers the more frequent minimalistic sessions, usually accompanied only by a drummer/bassist and a guitarist, with Tiersen switching seamlessly between piano, accordion, and violin for his lighter songs, and electric guitar for his harder pieces.

His girlfriend is a brazilian singer, Danni Carlos.

Amelie Poulain Yann Tiersen – Comptine d’un autre été

Societe Generale apologizes over fraud

By Stephanie Bodoni and Helene Fouquet

Jan. 25 (Bloomberg) — French Prime Minister Francois Fillon chided Bank of France Governor Christian Noyer for failing to inform him sooner that Societe Generale SA had suffered a record trading loss.

“It’s an affair of such an importance for the French financial system, that maybe the government could have been informed earlier,” Fillon told reporters in Luxembourg today.

He said he learned of the 4.9 billion-euro ($7.2 billion) loss on Jan. 23, the day before it was made public and at least three days after Noyer was told by the bank’s chairman.

Fillon’s comments may signal the beginning of official finger-pointing. Fillon ordered Finance Minister Christine Lagarde to complete an investigation in eight days. Noyer was will testify in a Senate hearing Jan. 30 and will be called to appear in the lower house of parliament in the coming weeks, said the head of its Finance Committee, Didier Migaud.

“France is known for being an interventionist state, which it is, and at the same time a country where the prime minister is not informed or aware and is even seemingly the last to know,” Dominique Reynie, a senior researcher at the Institute of Political Studies in Paris said in a telephone interview. “It’s bad for the economy. Confidence will fall while skepticism toward the government will increase,” he said.

`Real Time’

Societe Generale, France’s second-biggest bank by market value, said yesterday that unauthorized bets on stock-index futures by a single trader caused the loss, the largest in banking history. Noyer said he was told during the weekend that began Jan. 19, and was kept informed in “real time.”

“Is it abnormal that the French government was informed four days after this affair was discovered?” Fillon said. “It’s a private bank. It isn’t obliged to do so.”

“All necessary contacts were made in due course,” Noyer said at a briefing yesterday. After informing Noyer, Societe Generale liquidated the positions starting on Jan. 21.

The day that Societe Generale began unwinding the trades linked to European stock-index futures, equity markets in France, Germany and the U.K. fell more than 5 percent. The next day the U.S. Federal Reserve announced a decision to cut interest rates as “financial market conditions continued to deteriorate.”

Fed policy makers didn’t know about the losses at Societe General prior to the rate reduction, a Fed official said yesterday. ECB President Jean-Claude Trichet told LCI television in an interview today that the Bank of France said “what had to be said” within the European system.

Central Banks’ Role

“These things really have to be communicated among European supervisory authorities as soon as possible,” said Karel Lannoo, chief executive officer of the Centre for European Policy Studies in Brussels. “Central banks are at the center.”

Societe Generale and Noyer guarded the information as closely as possible to prevent leaks that could have ruined the bank, said Elie Cohen, a Societe Generale director and economist at France’s National Center for Scientific Research in Paris.

“This was the highest crisis situation,” Cohen said in an interview. “So thinking about calling the Prime Minister? No. Sorry if he gets annoyed. They had to call the bank regulator.”

With positions that surpassed the bank’s market value of about 40 billion euros, “if a hedge fund found out about it, the bank was dead,” he said. “In an ideal world, the government could be informed of such a crisis, but because of today’s world and markets, you just take the best and most efficient measures.”

Societe Generale Chairman Daniel Bouton apologized to shareholders and clients in a letter posted on the company’s Web site today and published in major newspapers, saying the trading loss was “perfectly unacceptable.” The letter insisted the Paris-based company remains solid.

The bank took the right steps in responding to rogue trading, European Union Financial Services Commissioner Charlie McCreevy said today in a Bloomberg Television interview at the World Economic Forum in Davos.

To contact the reporter on this story: Stephanie Bodoni in Luxembourg at sbodoni@bloomberg.net ; Helene Fouquet in Paris hfouquet1@bloomberg.net

Lacoste Big Wheel Duffle

Lacoste Lacoste Big Wheel Duffle – GREEN

The dowle rod construction of this brief gives the bag strength and personality. The rich, full grain leather exterior makes you look good. The roomy, double gusseted interoir with rear organizer section, and plenty of pockets to faithfully hold your business essentials, cell phone and other items.

RIP Paul L’Ecuyer.

Melissa Arrington will spend 10 years in prison because (a) she was driving drunk when she killed bicyclist Paul L’Ecuyer and (b) she was caught on tape laughing about his death.Judge Michael Cruikshank said during a sentencing hearing that the conversation, which was recorded on a jail telephone, is “breath-taking in its inhumanity,” according to the Arizona Daily Star.He spoke after hearing the 27-year-old stripper laugh while a male friend passed along congratulations: John says as far as he’s concerned, you did the world a favor. Because you took out a [expletive] tree hugger, a bicyclist, a Frenchman and a gay guy all in one shot. He’s proud of you. He says as far as he’s concerned, they should give you a medal and a [expletive] parade.

When the caller says he knows “that’s terrible,” the laughing inmate says, “No, it’s not.”

The judge disagreed, and despite Arrington’s claims in court that she plans to start an anti-DUI group, he sentenced her to a lengthy term in prison.