Right on time, The Wall Street Journal has an "analysis" that shows Libor doesn't actually reflect banks' borrowing costs.

Kareem Serageldin, the former head of Credit Suisse's CDO business arrested in London on Wednesday, said he will fight extradition to the U.S. When Mr. Serageldin was charges in February for running a scheme to falsify trading positions, he expressed surprise over the indictment, noting through lawyers that he was cooperating with attorneys. When he was nabbed outside the U.S. embassy in London this week, he said through a lawyer that he was working on a plea deal, and that his capture was the result of "miscommunication."Investors pulled capital from Spain for the 13th straight month.

Treasury Secretary Tim Geithner is wading into the void left when the Securities and Exchange Commission decided not to propose new rules for money market funds.

The White House is circulating a draft executive order on cyber-security after a string of DDoS attacks on the consumer banking websites of Bank of America, JPMorgan Chase, Wells Fargo and other financial firms.

Former Lehman Brothers CFO Erin Callan is flying her East Hampton coop.

A forgery suit against Allen & Co. CEO Herb Allen—who was being sued on claims that he had conspired to forge a dying cousin's will—has been dismissed.

True story? A British oil trader got blotto, bought $520 million in oil futures in the middle of the night, had no recollection of any of it. The Financial Services Authority suspended him for five years, commented dryly: “Mr Perkins poses an extreme risk to the market when drunk.”

Would you give money to a hedge fund called POOF? Would you be surprised to learn that said fund's manager just coughed up $6.8 million to settle cherry-picking charges—that he stuck clients with losing trades and moved profit-making trades to his wife's account?

“This is a great day for the art world and all those who seek order and justice in our society": Bond king Jeffrey Gundlach's Mondrian has been recovered.

Bank of America is accelerating cost-cutting plans, and may eliminate another 16,000 jobs by the end of the year, The Wall Street Journal reports. Most of the cuts will focus on the company's retail operations, as firm closes branches and shrinks its mortgage operation. Project New BAC, as the bank's restructuring efforts are called, is designed to save $8 billion annually by 2015.

Federal lawmakers are weighing means to prevent cities from using eminent domain to seize mortgages. A proposed law would prevent Fannie Mae and Freddie Mac from buying mortgages in localities that attempt to ease borrowers' woes by seizing mortgages, according to Bloomberg. Chicago and San Bernardino County have considered eminent domain as an approach to the foreclosure crisis.

The Department of Justice is asking for more time to complete its investigation of banks implicated in efforts to manipulate interbank-lending rates, according to The Journal. While the statute of limitations on the potential Libor-rigging violations is 5 years, banks generally prefer authorities not rush investigations. DoJ's move comes after the Commodities and Futures Trading Commission made similar requests this summer.

Libor is hardly the only financial benchmark vulnerable to manipulation, according to a paper from an international group of regulators.

The chances that Greece will leave the eurozone have increased now that the region is better prepared for a possible Grexit, Citigroup economists say, according to Business Insider.

Doubleline founder Jeffrey Gundlach was the victim of a $10 million robbery, Business Insider says, citing the Los Angeles Times.

The head of payment processing for Full Tilt Poker pleaded guilty and faces as much as 15 years in prison for misleading banks into accepting online gambling transactions.

At Naked Capitalism, Yves Smith got fooled by a fake Newsweek article in which Niall Ferguson was purported to wonder, "Was Mussolini Right?"

My name is Arch Crawford, and I'll be your financial astrologer.

Goldman Sachs' Chief Financial Officer David Viniar will retire at the end of January, the firm said in a press release yesterday. His replacement, Harvey M. Schwartz, will have big shoes to fill. Mr. Viniar “set the gold standard for CFOs across the industry,” analyst Meredith Whitney said in a note, according to Bloomberg. A graduate of Rutgers University and Columbia Business School, Mr. Schwartz joined Goldman through commodities trading unit J. Aron, the same business in which Goldman CEO Lloyd Blankfein and COO Gary Cohn started in the firm.

Lawyers for the bankruptcy estate of Lehman Brothers sued JPMorgan over $2.6 billion in derivatives claims.

Renee Haugerud, the founder of hedge fund Galtere, describes herself as “a tire kicker, not a screen watcher,” in an interview with Bloomberg Markets magazine. Mr. Haugerud renewed her faith in a recent bet on corn futures after noting the dry soil and shorter -than-usual corn stalks at her firm's Minnesota test farm.

Depositors pulled about $425 billion euros from banks in Portugal, Ireland, Greece and Spain in the 12 months ended July 31. Deposit flight is creating a two-tiered banking system that undermines European efforts to save the region's monetary union, according to Bloomberg.

Distressed debt investors such Paul Singer's Elliott Management are running out of fresh carcasses from which to pick their profits, according to The New York Post.

Short-seller Jim Chanos sees no shortage of overvalued stocks, according to Bloomberg.

A Muslim hacker group may have been responsible for a slowdown on the Bank of America website.

UBS plans to cut 80 to 90 jobs in its European investment banking operation by the end of the year, according to Bloomberg.

The terms of the settlement were fairly complex: The servicers would pay about $5 billion in direct payments to states and borrowers, and provide about $20 billion in so-called consumer relief. So much would go to principal reductions, so much so much for refinancing underwater loans, etc.

The independent monitor overseeing the settlement released a progress report today, and the news was maybe a little bit embarrassing for a certain North Carolina-based bank. As of June 30, the lender had not processed a single first-lien loan modification. (Said bank had processed $4.79 billion in shorts sales under the settlement.)

BofA  has an explanation of course, and we suppose it's reasonable. According to Bloomberg:

Separately today, Bank of America said it had completed about $3.2 billion more in relief since June 30. The Charlotte, North Carolina-based lender had forgiven about $1.65 billion in home equity lines of credit, completed $1 billion in short sales and $596 million in mortgage modifications from the end of June through Aug. 21.

“You are seeing a faster start on short sales completed under the agreement because that didn’t require a new process to be built, compared to first-lien modifications and the refinance program,” said Dan Frahm, a Bank of America spokesman. Eventually, most of the Bank of America credits will be loan modifications, he said.

And we suppose it's not a race (although if you were a borrower waiting on a modification, you might be forgiven for expecting a little bit of urgency). Nonetheless, you'd think the lender might have figured out a way to keep from throwing up a zero.

Ray Dalio isn't making friends in Stamford, Conn., says The New York Post, reporting that the Bridgewater founder ticked off locals with the surprise demolition of a boatyard to make way for the massive hedge fund's new waterfront headquarters.

Bill Ackman’s position in JCPenney has cost his hedge fund, Pershing Square, $900 million this year as shares fell 18 percent.

The government is investigating possible mortgage fraud at Residential Capital, the mortgage-lending unit of government-owned Ally Financial, Reuters reports. The Securities and Exchange Commission disclosed in court filings Monday that it had issued a formal order of investigation in February to probe ResCap's mortgage-bundling and underwriting practices. Ally, which is 74 percent-owned by the Treasury after a series of bailouts during the financial crisis, placed ResCap into bankruptcy proceedings in an effort to shed bad assets ahead of a potential IPO.

Barclays may face a criminal investigation into whether it properly disclosed details of a deal to raise capital with Qatar sovereign wealth funds during the financial crisis.

Morgan Stanley and Citigroup will allow more time for the appraisal of their joint-venture brokerage, Morgan Stanley Smith Barney. Investment bank Perella Weinberg was set to put a value on the JV this week, but will delay the decision until Sept. 10.

Prosecutors revised the indictment of Level Global Investors co-founder Anthony Chiasson and ex-Diamondback Capital Management portfolio manager Todd Newman, adding new counts of securities fraud pertaining to alleged insider trading in Nvidia Corp.

The Occupy movement isn't over "until the last person calls it quits and goes home, wherever home is," an organizer tells Bloomberg as the movement's Sept. 17 day of action approaches. This is proving to be the case in Hong Kong, where 10 or so protesters continue to hold out in HSBC headquarters.

Can Spain avoid Greece's vicious cycle?

Mutual funds run by Morgan Stanley are showing hefty stakes in Facebook, The Wall Street Journal reports, and while many of those shares were acquired pre-IPO, allowing the funds to show paper gains despite Facebook's fallen stock price, investors in the funds are at risk of further Facebook losses.

HSBC is talking settlement with U.S. regulators over charges the bank violated sanctions against Iran and Sudan among other nations. The bank set aside $700 million for the matter in July.

Bank of America's four new directors are typical bank-director types, Bloomberg reports, perhaps indicating that BofA thinks it's on the right path, definitely indicating that the train has left the station on our dream of shaking up the North Carolina-based bank from inside the boardroom.

Citigroup's private banking unit withdrew $410 million from John Paulson managed hedge funds, a lot of money, no doubt, but as sharper wits than ours have pointed out, so long as Mr. Paulson himself doesn't send a redemption letter to a certain hedge fund located at 1251 Avenue of the Americas, Paulson & Co. should be okay.

SEC Chairman Mary L. Schapiro through down her arms in the effort to rein in systemic risk posed by money-market funds. The Times says the Treasury might take up more powerful weapons.

The case of Vietnamese banker Ly Xuan Hai shows once again that it's safer to be a crooked banker in the west than the east.

A top German politician said that the Greek bailout plan can't be renegotiated. Though history tells us there can't be a renegotiation until in fact there is. Elsewhere, is Finland the forgotten frontier in a potential eurozone breakup?

Think of the fees! Somewhere a lawyer is drooling over the possibility that Wall Street firms that don't participate in setting Libor will start suing the firms that do. Asked about such a legal stance during Goldman Sachs' second-quarter earnings call, Chief Financial Office David Viniar demurred. The more banks enter settlements like Barclays $451 million pact with regulators, the higher the likelihood of interbank lawsuits, Bloomberg reports.

Soon to be Libor-ated? Bloomberg has the names of three traders—Michael Zrihen at Credit Agricole, Didier Sander at HSBC and Christian Bittar at Deutsche Bank—said to be under investigation for manipulating interbank lending rates.

So you'll have to share..."I have to apologize that there are so many people in the audience I don't have enough subpoenas for all of you," U.S. attorney Preet Bharara told a room full of investors yesterday at the Delivering Alpha conference. Also: “If you have open and aggressive and fair and proper and proven cases that you bring, and you show that in the kinds of cases that I’ve brought, that’s the kind of thing that over time gives people more confidence in the market.”

Rebound: How Martha Coakley, the Massachusetts attorney general who lost a 2010 Senate seat to Scott Brown, declared war on Wall Street's role in the collapse of the housing market.

Not so golden: The foreclosure rate among Americans over 50 is rising faster than in previous years, according to the AARP.

Whither Europe: Spain is paying more to borrow on 5-year bonds than it has at any point since 1996.

CFPB strikes: Capital One will pay $210 million to settle charges that call-center contractors pressured customers into buying products such as identity-theft monitoring. The settlement included a $25 million fine paid to the Consumer Financial Protection Bureau, in what has been touted as the year-old agency's first major enforcement action.

Will travel: Lloyd Blankfein would not waive his magic wand over Dodd-Frank and make it disappear, he said at the Economic Club of Washington, D.C. He also joked that he'd like to be courted for a political appointment when his career at Goldman ends. “By any president," he said. "I didn’t mean to limit it to the United States.”

Missed: Morgan Stanley reported second-quarter earnings of 16 cents per share, well short of Wall Street's expectations for 29 cents.

U.S. v. Gupta: It was wiretap day at U.S. vs. Gupta, as prosecutors played FBI recordings of Raj Rajaratnam in an attempt to show that the Galleon Group manager had been tipped to purchase Goldman Sachs stock before Warren Buffett announced a $5 billion investment in the bank. Mr. Rajaratnam told a trader he'd heard that "something good might happen at Goldman."

A month later, the now-imprisoned hedge fund manager was recorded telling Galleon portfolio manager David Lau that he'd heard from "somebody on the board of Goldman" that the company was lagging earnings estimates.

Defense played an FBI wiretap of its own.

Later in the day, prosecutors tried to demonstrate the close bond between Mr. Gupta and Mr. Rajaratnam. “Raj is one of the most outstanding hedge fund managers and a very close friend,” Mr. Gupta wrote in a Feb. 2007 e-mail admitted into evidence.

Costly glitch: There was always something strange about news reports that Nasdaq would set up a $13 million fund to handle claims from market participants who lost money when a bug in the exchange's trading software and delayed Facebook's market debut and the delivery of by-and-sell confirmations on the stock. Now Reuters is reporting that four of the top market makers in Facebook—Knight Capital, Citadel Securities, UBS and Citi's Automated Trading Desk—probably lost more than $100 million from Nasdaq's technical problems.

Facebook's underwriters lent Facebook shares to short-sellers as the stock price plummeted. Conflict of interest? Morgan Stanley didn't lend shares, according to the Wall Street Journal, although IPO managers often do.

Was that an oversight? The risk committee on JPMorgan's board of directors is comprised of a museum head, the grandson of a billionaire and the CEO of a company that makes work boots. The only committee member with banking experience left the industry more than 25 years ago, Bloomberg reports.

BofA wins: Freddie Mac forced Bank of America to buy back $330 million in mortgages the firm sold to the government-sponsored entity, after used computer programs—as opposed to human appraisers—to value properties. It may not be a bad thing for BofA, according to a Credit Suisse analyst, because the bonds from which the loans are being repurchased, at face value, no less, are trading at high premiums.

They're thinking about it: The SEC is apparently still weighing an enforcement action against Lehman Bros., despite a recently uncovered memo indicating that the nearly four-year-old investigation was coming to a close. The memo was written by an underling and is months old, Dealbook reports.

From the desk of Dick Fuld: Speaking of Lehman, this wins the prize of the best piece of alternate reality in the Jenner document dump: "So it is an enormous tribute to the strength and growth of our franchise that Warren Buffett, the world's most respected investor, has decided to invest $3.5 billion in our Firm through Berkshire Hathaway." (H/t ValueWalk.)

Another helping: Bankia SA, the oft-distressed lender, is expected to ask Spain for more than the 14 billion euros needed to meet government mandates.

Crystal ball: What would a Grexit mean for the U.S. economy?

What's Good for the Gupta: The trial of former McKinsey & Co. chief executive Rajat Gupta opened yesterday, and legal cliche abounded. Tasked with explaining insider training to a jury of laypeople, prosecutor Reed Brodsky likened Mr Gupta's alleged crime to telling others "the outcome of a game before it ends," according to The New York Times. Defense lawyer Gary Naftalis said the government was giving the jury a "cropped photograph."

As shown above, Mr. Brodsky addresses the jury, while Mr. Gupta (center), Mr. Naftalis (right) and Judge Jed Rakoff look on.

Late action: Morgan Stanley's consumer Internet analyst cut revenue projections for Facebook the days before the offering, an unusual move for an IPO's underwriter and a potential factor in the stock's sluggish opening day. Goldman Sachs and JPMorgan also cut projections after Facebook filed a revised S-1 on May 9.

Counterparties: Goldman Sachs and Bank of America are among about a dozen banks to profit from JPMorgan's recent trading losses. The Wall Street Journal doesn't reveal specifics, but notes that some banks traded directly against JPMorgan, while others were "vocal in encouraging investors" to trade against the London Whale.

Citigroup, Bank of America and Wells Fargo said that they avoid the type of derivatives-based hedging strategy employed by JPMorgan's chief investment office.

Quant 2.0: "Original quant pioneer" Robert Jones is launching a new hedge fund, System Two Advisors, with $50 million a team of India-based analysts to provide human input for computer models.The idea is to make humans—stripped of human biases—integral to the quantitative strategy.

Japan sliced: Fitch cut Japan's sovereign debt to A-plus, as the country struggles to rein in a debt load of more than 200 percent of GDP.

NSS Dept.: The Organization for Economic Cooperation and Development said the U.S. and Japan are leading a fragile economic recovery, but that the euro crisis threatens world growth in a semi-annual report.

IPO chart: Hong Kong's most popular IPOs have returned the least to investors since 2010.

Wine decline: 2011 Bordeaux's are selling for as much as 45 percent less than recent vintages, as the Asian market becomes more selective and U.S. and European markets remain subdued.

[Shirley Shepard/AFP/GettyImages]

Losses mount:

Before Bruno Iksil was nicknamed the London Whale, he was called "the Caveman" for what rivals thought were overly-aggressive trades that nonetheless generated large profits.

Out of stock: Morgan Stanley & Co., Wells Fargo Advisors, Fidelity and TD Ameritrade are among brokerages to stop accepting orders for the Facebook IPO. Morgan Stanley told advisers that it would limit clients to 500 shares each, to better allow more muppets, er, retail customers to get in on the madness.

Whither Europe: A Grexit could cost the eurozone hundreds of billions of dollars. Germany would take the greatest hit, naturally. French taxpayers could be on the hook for 66.4 euros, a recent study showed.

Spain's borrowing costs shot up amid economic data that showed the country had slipped back into a recession, and reports that nationalized Bankia SA was experiencing a run on deposits.

Short capital: The world's 29 systemically important financial institutions, or SIFIs, need to raise an additional $566 billion, a 23 percent increase on existing reserves, to meet new capital requirements, Fitch Ratings said today.

Home stretch? Foreclosures at five-year lows, and depressed home prices and cheap borrowing rates mean buying a house has never been more affordable, according to an index tracked by the National Association of Realtors. Good luck getting a loan.

BofA power play: Bank of America hired three Credit Suisse investment bankers who specialize in the power industry, according to a memo obtained by Dealbook. Ray Wood will become BofA's new head of U.S. power and renewables; Gavin Wolfe and Jason Satsky will work under Wood.

No truth in ads: Skechers agreed to pay $50 million in a settlement with the Federal Trade Commission, after the shoemaker aired advertisements promising that its "toning shoes" could help consumers "get in shape without setting foot in a gym."

Pass the nitrous: Private equity firms buy dental management companies. Unneeded procedures ensue under pressure to boost profits.

Survey says: Why's it always gotta be the finance guys who act like online dating sociopaths? A 24-year-old finance pro (non-banking division) asked a date to complete a written survey (sample question: "Mike is very masculine; at any point did you feel he was compensating for anything?"); the date sent the questionnaire to Deadspin.

[Photo by Mario Tama/Getty Images]