Yesterday we wrote about Jefferies CEO Rich Handler’s brilliant email sharing 10 life lessons he wants all of his employees to learn this summer.
The lessons are in the form of an imagined summer reading list and the book titles are made up. Each title/synopsis is supposed to represent a lesson.
If you know the history of Jefferies, you’ll notice that one of the books is a bit of a head scratcher.
Here it is:
“6.) 10-Q Reading for Dummies: A simpleton’s guide to looking at long positions and short positions of the same asset class when they are both listed on the same page”
What’s he saying? It turns out, Handler is taking a big (but veiled) shot at the credit ratings agency Egan Jones.
Here’s the deal…
In the Fall of 2011, broker-dealer MF Global had just filed for bankruptcy. At this time, folks were wondering which firm could be next.
Ratings agency analyst Sean Egan, the co-founder of Egan-Jones Ratings Company, cried MF Global for Jefferies. He downgraded the company’s stock and made appearances on CNBC, Fox Business and Bloomberg TV slamming the firm. As a result, Jefferies stock tanked.
Jefferies didn’t go the way of MF Global. The company survived, and a year later, the firm was acquired by Leucadia.
The joke inside at Jefferies is that Egan refused to look at all of their long and short positions that were listed on the same page of their 10-Q showing that they were in fact fully hedged.
Late last year, Egan emailed Handler, “I would like to apologise for harm caused to you”, Dealbook’s Susanne Craig reported.
The two met at Jefferies offices in Midtown. According to the report, Egan said he would go on-air and apologise. That never happened. Egan told Dealbook that he still stands by his report.
Some feuds never end.
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