Opening Bell: 05.03.12

Banks Get Silent Treatment At Fed Meeting (WSJ)
A meeting Wednesday between a top Federal Reserve official and six bank bosses was notable largely for long silences from the central bank’s side of the table. Fed governor Daniel Tarullo met with the executives to discuss the recent “stress tests” and to hear out the banks’ concerns over proposed new regulations. Mr. Tarullo and the bankers exchanged thoughts about the tests, but the Fed official didn’t respond when the chief executives laid out their new-rule concerns, starting with a Fed proposal to limit the biggest banks’ exposure to other firms and governments, said people familiar with the meeting.

Carlyle Prices IPO At Lower Range (WSJ)
The downshift came after some mutual-fund investors pushed for a better deal, said people familiar with the matter. Also, they said, Carlyle hoped a lower price would help ensure good first-day and longer-term performance. People close to Carlyle said the firm could have stuck with a price in the original range, but it wished to attract some larger investors who wanted a lower price.

Carlyle Founders’ Stakes Valued at $1 Billion Each Post-IPO (Bloomberg)
“This is their legacy,” Reena Aggarwal, a finance professor at Georgetown University’s McDonough School of Business in Washington, said in a telephone interview. “They started the firm from nothing, so their human capital and their financial wealth are tied up in the company. They need to have this liquidity event.”

U.S. documents allege HSBC money-laundering lapses (Reuters)
…documents allege that from 2005, the bank violated the Bank Secrecy Act and other anti-money laundering laws on a massive scale. HSBC did so, they say, by not adequately reviewing hundreds of billions of dollars in transactions for any that might have links to drug trafficking, terrorist financing and other criminal activity. In some of the documents, prosecutors allege that HSBC intentionally flouted the law. The bank created an operation that was a “systemically flawed sham paper-product designed solely to make it appear that the Bank has complied” with the Bank Secrecy Act and is able to detect money laundering, wrote William J. Ihlenfeld II, U.S. Attorney for the Northern District of West Virginia, in a draft of a 2010 letter addressed to Justice Department officials.

Buffett Trails S&P 500 for Third Straight Year (Bloomberg)
FYI.

Fancy A Drink With Richard Branson? (Virgin via Daily Intel)
Richard Branson is now on board all Virgin Atlantic flights ‘in spirit’ – thanks to new Little Richard ice cubes. Virgin Atlantic is giving Upper Class passengers the chance to cool their in-flight drinks with bespoke Richard Branson ice cubes. They will be served on board one of the first flights of the airline’s new Upper Class Cabin this May…The ice cubes have been created using the exact measurements of Sir Richard’s head and feature an impressive level of detail. The mould for the ice cubes took a team of four skilled designers a painstaking six weeks to create using detailed photographic techniques and laser scanning technology to create the perfect likeness of Sir Richard.

Jobless claims tumble, calms job market fears (Reuters)
The number of Americans filing new claims for jobless aid fell more than expected last week, easing fears the labor market recovery was stalling. Initial claims for state unemployment benefits dropped 27,000 to a seasonally adjusted 365,000, the Labor Department said on Thursday. The biggest weekly drop in claims since early May last year helped to lift some of the dark cloud cast over the labor market by a report on Wednesday from payrolls processor ADP showing private employers in April created the fewest jobs in seven months.

John Arnold Retiring At 38 (NYP)
Arnold, who has an estimated net worth of $3.5 billion, said in a letter to investors that he was closing the Centaurus Energy Master Fund in order to “pursue other interests.” In the letter, he said the fund had performed “better than I could have hoped for or imagined” with returns on investments consistently high, “often in triple digits.” Arnold was a major force behind the rapid rise of energy trader Enron in the 1990s.

SocGen Profit Hit by Restructuring Plan (WSJ)
Société Générale said Thursday that first-quarter earnings at its investment bank rebounded from the tough previous quarter but fell from the year-earlier period, pressured by a restructuring plan aimed at sheltering the French bank from Europe’s still-smouldering debt crisis. Société Générale, France’s second-largest lender by market value and the first to report quarterly earnings, said net profit dropped 20% to €732 million ($963.2 million) from €916 million a year earlier, hit mainly by losses on loan portfolios it sold.

Independent Counsel For MF Global Is Sought (WSJ)
Criminal and civil investigators have been looking into the case, but so far have said little about the progress of their investigation. That has led some Republicans and customers of MF Global to question whether the investigation is being slowed by a desire to show deference to the firm’s former chief executive, Jon Corzine. Mr. Corzine, a former U.S. senator and governor of New Jersey, has been a prominent Democratic fund raiser and supporter of the Obama administration. The letter circulated by Rep. Grimm’s office acknowledges that while “we have no direct evidence” that the Department of Justice “is providing special treatment…perception matters a great deal.” Still, the letter concludes that “an independent investigation is urgently needed.”

Kona teen nears perfect school attendance record for 13 years (WHT)
Cetraro thinks improving and encouraging attendance requires a more comprehensive approach, one that goes beyond sanctions. When Cetraro was in elementary school, she appreciated privileges like running in the sprinklers, being first in line for lunch or dismissal, having the chance to act as the teacher’s assistant and getting shave ice. She said these incentives served as powerful motivators.

47 comments (hidden to protect delicate sensibilities)
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Comments (47)

  1. Posted by guest | May 3, 2012 at 9:51 AM

    I showed up to school everyday for the free breakfast and the air conditioning.

  2. Posted by Hakuna Matata Guy | May 3, 2012 at 9:51 AM

    Hen-rik….Hen-rik…..Hen-rik

  3. Posted by Baggy Salls | May 3, 2012 at 10:00 AM

    So when my balls are sore from banging the stewardess, I can ice them down with Richard Branson’s face. I'll be a Virgin Air member for life now.

  4. Posted by Third Eye | May 3, 2012 at 10:03 AM

    How's it gunna be when you don't know me anymore?

  5. Posted by Whoops | May 3, 2012 at 10:11 AM

    Richard Branson: Making penis jokes too easy since at least 2012.

  6. Posted by for example | May 3, 2012 at 10:22 AM

    Big Dick ice cubes > Little Richard

  7. Posted by Lowly Assistant | May 3, 2012 at 10:43 AM

    What's a goon to a goblin?

    -John Arnold

  8. Posted by Laxbro | May 3, 2012 at 10:45 AM

    Anyone else flying to the Derby this weekend? Dressed up to get messed up..

  9. Posted by Laser Lockwood | May 3, 2012 at 10:52 AM

    Come on, man – just stop. You're making us all look bad.

    LaCrosse Players Everywhere

  10. Posted by Guest | May 3, 2012 at 10:57 AM

    I am packing up my daughters into a trailer and heading down as we speak.

    -W. Noel

  11. Posted by Texashedge | May 3, 2012 at 10:58 AM

    And in a parallel universe, billionaire Brian Hunter is retiring at age 38 to pursue other interests.

  12. Posted by Lowly Assistant | May 3, 2012 at 10:59 AM

    What's a goon to a goblin?

  13. Posted by Lowly Assistant | May 3, 2012 at 10:59 AM

    Pics or it didn't happen, neighsayer.

  14. Posted by Laxbro | May 3, 2012 at 11:02 AM

    I don't see how flying TEB to SDF and getting rowdy with the Rascal Flatts in millionaires row is making anyone look bad. Bourbon and bad decisions..

  15. Posted by VonSloneker | May 3, 2012 at 11:03 AM

    It could still happen…

    - Consultant, Peak Ridge Capital Group

  16. Posted by Gonzo Fan in Texas | May 3, 2012 at 11:06 AM

    "The Kentucky Derby Is Decadent and Depraved" is a seminal sports article by Hunter S. Thompson on the 1970 Kentucky Derby in Louisville, Kentucky, first appearing in an issue of Scanlan's Monthly in June of that year. Though not known at the time, the article marked the first appearance of gonzo journalism, the style that Thompson came to epitomize through the 1970s."

    -wiki

  17. Posted by Texashedge | May 3, 2012 at 11:06 AM

    Quoth Jack Ryan, "it was a 50-50 shot, and I needed a break"

  18. Posted by E. Texas Gas Trader | May 3, 2012 at 11:15 AM

    "The Widowmaker" isn't just the title of a movie about a dangerous Russian submarine.

  19. Posted by Soopy | May 3, 2012 at 11:20 AM

    Richard Branson giving head 'in spirit' to everyone in Upper Class.

  20. Posted by Horse Bettor | May 3, 2012 at 11:21 AM

    2012 KD entries

    Daddy Long Legs 30/1
    Optimizer 50/1
    Take Charge Indy 15/1
    Union Rags 9/2
    Dullahan 8/1
    Bodemeister 4/1
    Rousing Sermon 50/1
    Creative Cause 12/1
    Trinniberg 50/1
    Daddy Knows Best 15/1
    Alpha 15/1
    Perspective 30/1
    Went The Day Well 20/1
    Hansen 10/1
    Gemologist 6/1
    El Padrino 20/1
    Done Talking 50/1
    Sabercat 30/1
    I'll Have Another 12/1
    Liaison 50/1

  21. Posted by Shallow Pockets | May 3, 2012 at 11:32 AM

    Spreads are still less risky than outright positions.

  22. Posted by UBS MD | May 3, 2012 at 11:37 AM

    Lucky girl. She is going places. Top tier got shaved ice as bonuses this year! Enough to make me come in everyday!

    -UBS MD

  23. Posted by VonSloneker | May 3, 2012 at 11:50 AM

    DB bookmaking correspondent, news we can use…exacta, trifecta, and longshot pick.

    - Polishing up the julep cup

  24. Posted by fitting in | May 3, 2012 at 12:00 PM

    is it me or the ice cube looks a bit like Lenin? In Soviet Russia, etc. etc…

  25. Posted by Parlay Paul | May 3, 2012 at 12:02 PM

    Where is our bookie….er…..cardboard box salesman?

  26. Posted by Randy West | May 3, 2012 at 12:12 PM

    "Gonzo pornography is a style of pornographic film that attempts to place the viewer directly into the scene. The name is a reference to gonzo journalism, in which the reporter is part of the event taking place."

  27. Posted by Meth(OD) Man | May 3, 2012 at 12:34 PM

    ". . . getting shave(sic) ice."

    2 rocks for a 20

  28. Posted by PermaGuestII | May 3, 2012 at 1:49 PM

    If HST thought it was "decadent and depraved" it's hard to imagine being able to survive the experience.

  29. Posted by terribleiknow | May 3, 2012 at 1:57 PM

    ….ice shave you?"

    <duck/wince>

  30. Posted by fitting in | May 3, 2012 at 2:02 PM

    …comrad's watching you from your drink?

  31. Posted by Legend follower | May 3, 2012 at 2:10 PM

    It's official. There's a Matt Levine fan club:
    http://blogs.wsj.com/financial-adviser/2012/05/03

    "LOL
    Matt Levine: Investment bankers have become experts at lighting money on fire. (Dealbreaker)"

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