Hope the Family already paid off the note for their ranch in Paraguay.

_{Turn back to the Constitution - and READ it.}

I just watched Trading Spaces for a bit last night. Margin call for the brothers!!! hahaha.. who are the Aykroyd/Murphy team bringing the party to a screeching halt today?

Also what's your source on this fun news?
--
Hongpong.com

The famous principals of Duke & Duke, the old line Philadelphia brokerage firm that was ultimately bankrupted by their own greed and the connivance of Billy Ray Valentine, Louis Winthorpe III, and the butler Coleman (Jamie Lee Curtis played a role in here somewhere too).

What a great business movie! It's outlasted virtually all others of the genre, and I like to watch it when the markets get too depressing.

Look, I know this has got nothing to do with the Carlyle group, or the markets, or anything economic, but I cannot go another day without complaining somewhere, to someone, about people misusing the word "epicenter", as, for example, I regret to say, in this piece. The "epicenter" of an earthquake is not the absolute dead center thereof. It is the point "on" or "over" (Greek epi) its center: more precisely, the point on the earth's surface closest to where the earthquake occurs, which is below ground.

OK, you can go back to covering the demise of western capitalism now.

Gleeful comments may be premature. I don't have the inside line on this one, but it is clear that whatever their investment losses might be, those w/ wealth in excess of $50 million dollars can handle a loss of millions a lot more handily than those of us w/ hundreds of thousands in the marketplace from which we buy groceries and pay our ADSL service and property taxes. If this (as one Agonista put it politely) "de-leveraging" process snowballs, we are all going to feel it intensely. It just depends on whether this gang w/ Carlyle decided they could balance-out some of their big insider profits (capital gains) with some capital losses from this part of their investment portfolio. If that is all it means, this is just like a corporation announcing a writedown on a division that was not making any money: it is an accounting technicality and necessity. The more the financial markets unwind, the more ordinary people will feel it. History demonstrates that. At this stage, since this was only hours ago, reserve judgment on what it means for those of us who live in the real world.

In the privately held sector of the group you'll find they are a principal investor in AIG and most of the financial institutions listing losses in your previous post. Information they share publicly in their portfolio posted on their website does tend to change, but usually after an investment has drawn unwanted attention. All the foreclosures do leave tangible assets that some entity eventually holds title to, though it is being spoken about as a total loss. DO NOT ever think the Bush family will loose one cent. AIG carries the insurance coverage for our military and will be bailed out with our tax dollars. Expect the other institutions to be bailed out in kind-- at least that it how I see it in my foggy crystal ball, and not being an expert in any of this business I just reflect on what I've read.

Feeding off the tax payer has been elevated into an art form for so many of these companies. I'm only saying that investors in these Carlyle deals will not be getting their money out for quite a few years until the economy recovers.

For a long time it was assumed that a board seat was being left open for President George W. Bush upon his retirement in 2009, but in recent years that speculation has been dampened since the Carlyle Group requires from its board members a minimum of useful international contacts and some basic business competence.

George W. Bush held a board seat on Carlyle-owned Caterair for three years. Here's part of what Carlyle founder David Rubenstein said about him:

But when we were putting the board together, somebody came to me and said, look there is a guy who would like to be on the board. He’s kind of down on his luck a bit. Needs a job. Needs a board position. Needs some board positions. Could you put him on the board? Pay him a salary and he’ll be a good board member and be a loyal vote for the management and so forth.

I said well we’re not usually in that business. But okay, let me meet the guy. I met the guy. I said I don’t think he adds that much value. We’ll put him on the board because–you know–we’ll do a favor for this guy; he’s done a favor for us. We put him on the board and spent three years. Came to all the meetings. Told a lot of jokes. Not that many clean ones. And after a while I kind of said to him, after about three years–you know, I’m not sure this is really for you. Maybe you should do something else. Because I don’t think you’re adding that much value to the board. You don’t know that much about the company.

He said, well I think I’m getting out of this business anyway. And I don’t really like it that much. So I’m probably going to resign from the board.

And I said, thanks–didn’t think I’d ever see him again. His name is George W. Bush. He became President of the United States.

More in this Democracy Now transcript (and an audio clip is available).

from Marketwatch, 03/07/08:
2:06A Carlyle Capital: Liquidity at risk from further margin calls (NL:86522)
LONDON (MarketWatch) -- Carlyle Capital (NL:76522), the Amsterdam-listed affiliate of The Carlyle Group, said it received on Thursday substantial additional margin calls and additional default notices from its lenders that could quickly deplete its liquidity and impair its capital. some of its RMBS securities had been liquidated by lenders who had previously issued default notices. In the past several days there has been a rapid and severe deterioration in the market for U.S. government agency AAA-rated residential mortgage-backed securities, Carlyle Capital said. It added it's evaluating all options.

How revealing!

Syrinx, thanks for posting the quote from David Rubinstein. And I loved the comment: "the Carlyle Group requires from its board members a minimum of useful international contacts and some basic business competence."

Hardly needs to be said how useless he would be for them, especially now.

MetaLinguist

Carlyle receives further substantial margin calls

Some assets liquidated by lenders; company exploring all available options

By Simon Kennedy, MarketWatch
Last update: 10:43 a.m. EST March 7, 2008

LONDON (MarketWatch) -- Carlyle Capital, the investment fund affiliated with private equity firm The Carlyle Group, revealed Friday that it's received another wave of margin calls from lenders, raising fears that forced asset sales could virtually wipe out its capital.

The Amsterdam-listed fund said some of its residential mortgage-backed securities have already been liquidated by lenders and it's possible that additional securities may be liquidated after the latest margin calls.

Carlyle Capital (NL:86522: news, chart, profile) (CARYF) said that it's "considering all available options for the company."

Keith Baird, an analyst at Bear Stearns said the deciding factor in the fund's future may be whether Carlyle Group is willing to offer any more support.

"At this stage, the liquidation of the fund cannot be excluded nor the potential loss of its capital, rendering the shares worthless. Widening the context, this marks a further savage step in the ongoing credit implosion of recent months," Baird said.

The fund raised around $320 million in a July initial public offering and had total equity of $670 million at the end of December. It has leveraged that equity by using short-term loans, or repurchase agreements, to finance a $21.7 billion portfolio of residential-mortgage-backed securities issued by Fannie Mae (FNM
FNM).

The latest announcement comes after the fund said Thursday that it hadn't met margin calls from four counterparties to those repurchase agreements and that it was negotiating with counterparties for more stable financing terms.

On Friday it said it had received "substantial additional margin calls and additional default notices from its lenders."

According to a December filing, the fund's counterparties include Bank of America (BAC) , BNP Paribas (FR:013110: news, chart, profile) , Citigroup (C) and others. It also has a $150 million credit facility from Carlyle Group.

Carlyle said in the past several days there has been a rapid deterioration in the market for government agency AAA-rated residential mortgage securities.

"Based on the weakened market, several of the company's lenders marked down the value of the company's RMBS securities and informed the company that they would soon materially increase their collateral requirements," Carlyle said in a statement.

"The company believes these additional margin calls and increased collateral requirements could quickly deplete its liquidity and impair its capital," the fund added.

Shares in the group lost around 60% of their value Thursday and were suspended by the Dutch regulator Friday morning until further notice. The stock has fallen 75% since its July initial public offering.
The problems for Carlyle are part of a wider de-leveraging trend as investment banks -- struggling with their own subprime-related losses -- are lending less and calling in loans to hedge funds and other borrowers.

The trend started with investors directly exposed to subprime loans, but then spread to intermediate risk Alt-A mortgages and is now hitting some investors who hold safer securities from Fannie Mae and Freddie Mac.

just wow.

every time I get to thinking I have the measure of the corruption that glues bushworld together, I find new yet more depraved and inbred conflicts of interest. But it couldn't happen to a better bunch of nation-fuqqers.

Amsterdam exchange suspends trading of Carlyle fund
Posted: 07 March 2008 2323 hrs
AFP

AMSTERDAM : Share-trading in a troubled fund managed by US private equity giant Carlyle was suspended here early Friday at the request of Dutch stock market authorities, the market regulator AFM said.

The shares had lost 58 percent during trading on Thursday.

The fund, Carlyle Capital Corporation, said several securities backed by real estate loans had been "liquidated" by investors who had bought them according to an agreement that Carlyle would ultimately buy them back.

The action by investors came in response to the fund's inability to meet margin calls, which require an enterprise to show proof that it has cash reserves equal to a portion of the value of shares or positions it holds on a given market.

Without such guarantees on the level of reserves held by Carlyle Capital Corporation, some investors liquidated their holdings.

The fund said it was in contact with investors to try to resolve the matter. - AFP/ch

Carlyle fund faces liquidation after missed margin calls

By Sean Farrell
Saturday, 8 March 2008
The Independent

Carlyle Capital Corp, an investment fund managed by the US private equity giant Carlyle Group, said yesterday it had received additional margin calls from banks that could cause it to run out of cash.

The fund's shares were suspended in Amsterdam after they lost more than half their value on Thursday when it announced it had missed margin calls. Analysts said liquidation of the fund had become a possibility.

The fund said: "Although the company believed last week that it had sufficient liquidity, it was informed by its lenders this week that additional margin calls and increased collateral requirements would be significant and well in excess of the margin calls it received Wednesday. The company believes these additional margin calls and increased collateral requirements could quickly deplete its liquidity and impair its capital."

If margin calls erode its capital and the fund is liquidated, shareholders would end up with nothing. The fund's annual report said that at the end of 2007 its lending counterparties included Citigroup, Merrill Lynch and UBS, three of the banks hit hardest by credit crunch losses.

Keith Baird, a Bear Stearns analyst, said: "This marks a further savage step in the ongoing credit implosion of recent months... At this stage the liquidation of the fund cannot be excluded."

The shares were suspended at $5 after dropping 58 per cent on Thursday. Carlyle Capital sold shares in the fund for $19 in July in a $300m initial public offering on the Euronext exchange. The fund, which invested in mortgage debt, raised its cash when fears about the US sub-prime market. Those fears forced it to reduce the size of the IPO from a planned $400m.

Carlyle Capital added the $300m IPO money to a separate $590m pool of cash. It then borrowed from banks against the money to buy almost $22bn of top-rated mortgage debt issued by Fannie Mae and Freddie Mac, the government-backed US mortgage finance agencies.

With what Carlyle Capital describes as an "implicit guarantee" from the US government, its investments would normally be classed as highly secure. But panic about mortgage-backed bonds has spread, causing the spread between agency bonds and US Treasuries to hit levels not seen since 1986.

Carlyle Capital said it was in talks with its lenders and "considering all available options".

pissin' off the Bin Ladens and turning their kid into the world's number one boogey man. I say, what plays in the board room should stay in the board room. The Bin Laden Group has long since closed down business relationships with their duplicitous partners at Carlyle.

Carlyle

The Wall Street Journal Europe, Friday / Saturday September 28-29 2001, p.4

Bin Laden Family Has Intricate Ties With Washington
Saudi Clan Has Had Access To Influential Republicans

By Staff Reporters Daniel Golden and James Bandler in Boston, and Marcus Walker in Hamburg

If the U.S. boosts defense spending in its quest to stop Osama bin Laden's alleged terrorist activities, there may be one unexpected beneficiary: Mr. bin Laden's family.

Among its far-flung business interests, the well-heeled Saudi Arabian clan - which says it is estranged from Osama - is an investor in a fund established by Carlyle Group, a well-connected Washington merchant bank specializing in buyouts of defense and aerospace companies.

Through this investment and its ties to Saudi royalty, the bin Laden family has become acquainted with some of the biggest names in the Republican Party. In recent years, former U.S. President George Bush, ex-Secretary of State James Baker and ex-Secretary of Defense Frank Carlucci have made the pilgrimage to the bin Laden family's headquarters in Jeddah, Saudi Arabia. Mr. Bush makes speeches on behalf of Carlyle Group and is senior adviser to its Asian Partners fund, while Mr. Baker is its senior counselor. Mr. Carlucci is the group's chairman.

Osama is one of more than 50 children of Mohammed bin Laden, who built the family's $5 billion business, Saudi Binladin Group, largely with construction contracts from the Saudi government. Osama worked briefly in the business and is believed to have inherited as much as $50 million from his father in cash and stock, although he doesn't have access to the shares, a family spokesman says. Because his Saudi citizenship was revoked in 1994, Mr. bin Laden is ineligible to own assets in the kingdom, the spokesman added.

The bin Laden family has long disavowed Osama, and has cooperated fully with several federal investigations into his activities. The family business, headed by Osama's half-brother Bakr bin Laden, epitomizes the U.S.-Saudi alliance that the suspected terrorist often rails against. After the 1996 truck bombing in Dhahran, Saudi Arabia, that killed 19 U.S. servicemen, Saudi Binladin Group built military barracks and airfields for U.S. troops.

But the Federal Bureau of Investigation has issued subpoenas to banks used by the bin Laden family seeking records of family dealings, a person familiar to the matter said. This person said the subpoenas weren't an indication the FBI had found any suspicious behavior by the family. A family spokesman said he had no knowledge of the subpoenas but that the family welcomes them and has nothing to hide.

MORE at the link

Reuters, By Reed Stevenson, March 13

AMSTERDAM - An affiliate of U.S.-based buyout firm Carlyle Group has defaulted on about $16.6 billion of debt and expects its lenders to seize remaining assets as the global credit crunch tightens around leveraged investors.

Carlyle Capital Corp (CARC.AS: Quote, Profile, Research), a fund listed in Amsterdam, said in New York on Wednesday that negotiations with lenders deteriorated late in the day after a drop in the value of its mortgage investments would result in margin calls of $97.5 million on top of the $400 million it was already facing.

A "successful refinancing is not possible," Carlyle Capital said, after trying for the past week to work out a deal with lenders to stave off bankruptcy.

Bund futures in Europe rose after the news back to levels they traded at before the U.S. Federal Reserve and other central banks coordinated on Tuesday to inject liquidity into credit markets. The dollar also fell.

The credit crunch, triggered last year when subprime mortgages made to risky U.S. borrowers went sour, has put increasing pressure on lenders to shore up capital and made it difficult to value collateralized debt, mortgage portfolios and other fixed-income securities -- the investments that Carlyle Capital was set up to invest in.

"The credit angst is back," said Tim Condon, head of Asia research with investment bank ING.

[...]

Carlyle Capital, based in Britain's offshore dependency of Guernsey, said in the only assets it has left are AAA-rated residential mortgage-backed securities, and that it expected lenders to foreclose on the this collateral.

FT, By Marin Arnold, March 17

Carlyle Capital Corporation is to be wound up after the $22bn Amsterdam-listed mortgage fund said its shareholders had approved an application for a court appointed liquidator to sell its remaining assets.

The move sounds the death knell for an abortive attempt by the Carlyle Group, one of the world’s biggest private equity groups, to tap public markets for an ill-timed and highly leveraged venture into mortgage-backed securities.

”The company will now move forward with the winding up and liquidation application,” CCC said in a statement. ”During a compulsory winding up, all remaining CCC assets will be liquidated by a court appointed liquidator in a timely and orderly manner.”

The liquidation will take place in Guernsey, where the fund is registered. CCC said it had received default notices from its remaining two lenders and added that its liabilities now exceeded its assets.

Its board recommended liquidation ”following extensive analysis of the company’s prospects and careful consideration of other options for continuing the business”.

”The company will work with the court appointed liquidator to ensure an orderly realization of assets and their subsequent distribution,” it said.