Readings: Dreman buys Financials, Société Générale - No Défense, Green Energy boom
David Dreman, the 71-year-old value investor, said he bought more shares of financial institutions after the industry’s worst annual performance since 1990 created a “major opportunity.”
“There was panic in the market towards the end of the year and a lot of them went down far too much,” Dreman, who oversees $20 billion at Dreman Value Management LLC, said during an interview with Bloomberg Television. “There will be a turn, and this is probably a major opportunity in financials, probably one of the best in the last 15 years.”
- Economist: Société Générale, No Défense
SocGen has plenty of internal cops at its high-security headquarters in the La Défense enclave of Paris. The bank’s annual report for 2006 devotes 26 reassuring pages to its risk-management practices; more than 2,000 staff worked in the function that year, and lots more bodies were added in 2007. Yet none of them stopped Jérôme Kerviel, the trader accused of taking enormous unauthorised bets, from building an unhedged €50 billion exposure to European futures markets.
In common with other French banks, SocGen was also thought by many to take an overly mathematical approach to risk. “‘It may work in practice but does it work in theory?’ is the stereotype of a French bank,” says one industry consultant.
The industry in California is also helped by state and local governments’ substantial subsidies to stimulate demand. The state has earmarked $3.2 billion to subsidize solar installation, with the goal of putting solar cells on one million rooftops.
. . . subsidies have prompted a surge in private investment, led by venture capitalists. In 2007, these seed investors put $654 million in 33 solar-related deals in California, up from $253 million in 16 deals in 2006, according to the Cleantech Group, which tracks investments in alternative energy. California received roughly half of all solar power venture investments made in 2007 in the United States.
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