Opening Bell

Opening Bell: 05.29.12

Greece Pours $22.6 Billion Into Four Biggest Banks (Reuters)
The long-awaited injection—via bonds from the European Financial Stability Facility rescue fund—will boost the nearly depleted capital base of National Bank, Alpha, Eurobank and Piraeus Bank. “The funds have been disbursed,” an official at the Hellenic Financial Stability Facility, who declined to be named, told Reuters. The HFSF was set up to funnel funds from Greece’s bailout programme to recapitalise its tottering banks. The HFSF allocated 6.9 billion euros to National Bank, 1.9 billion to Alpha, 4.2 billion to Eurobank and 5 billion to Piraeus. All four are scheduled to report first-quarter earnings this week. The news came as two government officials told Reuters that near-bankrupt Greece could access 3 billion euros, left from its first bailout programme, to cover basic state payments if efforts to revive falling tax revenue fail.

U.S. Ready for Europe Fallout, Says Fed Official (WSJ)
“There’s absolutely no reason for people in the United States to get all in a dither,” Federal Reserve Bank of Philadelphia President Charles Plosser said in an interview with The Wall Street Journal. Mr. Plosser said that in the short run, uncertainty in Europe might even work in the U.S. economy’s favor, via lower U.S. interest rates and energy prices.

Greece to Leave Euro Zone on June 18, Says Guy (CNBC)
Greece will leave the euro zone on June 18 if the populist government wins the country’s elections on the 17 as the rest of the euro zone rounds on “cheaters,” Nick Dewhirst, director at wealth management firm Integral Asset Management, told CNBC Monday. “The euro zone is a club but you get cheaters who get away with it until everyone finds out and at that point you need to remove them otherwise everyone will cheat. It’s better for Greece to leave,” Dewhirst said. He added that Greek society was built on cheating and scheming, saying “everyone does it” but that voters elsewhere in the euro zone were now calling Greece to account. “The basic question is that a German has to increase working from 65 to 67 and that is to pay for Greeks retiring at 50. The 17th of June is the perfect opportunity to say either ‘we’ll behave’ or ‘we’ll carry on cheating,'” he said.

Facebook Debacle Turns High Hopes Into Potentially Mood-Souring Skepticism (WSJ)
It is impossible to measure the impact of Facebook’s flubbed deal on overall investor confidence. But there is at least one sign of possible fallout: More than $3 billion was yanked from U.S. stock mutual funds by small investors in the week ended Wednesday, according to EPFR Global Inc. in Cambridge, Mass. That was the worst week for withdrawals since March. In the previous week, investors added $311 million to U.S. stock mutual funds. David Guthrie, a 30-year-old actor in Toronto, bought 15 shares of Facebook on its opening day. Before then, he had bought just one stock, yet saw the market as a place to make his savings rise in the long run. Now he feels burned. “If Facebook had made a lot of money, I’d try it again,” Mr. Guthrie says. After the stock’s disappointing slide, “I would never put big money into the stock market.”

Moody’s Fading Relevance Exposed In Nordic Downgrades (Bloomberg)
Breaking: “Moody’s in general is very backward looking; they are often stating things that are well recognized from the financial community for a long time,” Swedbank Chief Financial Officer Goran Bronner said in response to Bloomberg questions on May 23. “I don’t think Swedish banks should put any particular emphasis on it.”

Zoos’ Bitter Choice: To Save Some Species, Letting Others Die (NYT)
…Ozzie, a lion-tailed macaque, will never father children. Lion-tails once flourished in the tops of rain forests in India, using their naturally dark coloring to disappear into the height of the jungle. Though there are only about 4,000 remaining in the wild, not one among Ozzie’s group here in St. Louis will be bred. American zoos are on the verge of giving up on trying to save them. As the number of species at risk of extinction soars, zoos are increasingly being called upon to rescue and sustain animals, and not just for marquee breeds like pandas and rhinos but also for all manner of mammals, frogs, birds and insects whose populations are suddenly crashing. To conserve animals effectively, however, zoo officials have concluded that they must winnow species in their care and devote more resources to a chosen few. The result is that zookeepers, usually animal lovers to the core, are increasingly being pressed into making cold calculations about which animals are the most crucial to save. Some days, the burden feels less like Noah building an ark and more like Schindler making a list.

JPMorgan Dips into Cookie Jar to Offset “London Whale” Losses (Reuters)
JPMorgan Chase has sold an estimated $25 billion of profitable securities in an effort to prop up earnings after suffering trading losses tied to the bank’s now-infamous “London Whale,” compounding the cost of those trades. Jamie Dimon earlier this month said the bank sold corporate bonds and other securities, pocketing $1 billion in gains that will help offset more than $2 billion in losses. As a result, the bank will not have to report as big an earnings hit for the second quarter.

Icahn Takes Chesapeake Energy Stake (WSJ)
Carl Icahn skewered Chesapeake Energy Corp.’s CHK board for corporate governance controversies and “irresponsible actions” while disclosing he acquired a sizeable new stake in the company.

Euro Likely Worthless as Collector’s Item (Bloomberg)

JPMorgan Beefs Up China Unit With $400 Million Injection (Reuters)
“The additional capital will better position the bank in the evolving regulatory environment and cement our commitment to clients in China,” Zili Shao, Chairman and chief executive of J.P. Morgan China, said in a statement on Monday. “The capital will be used to expand the bank’s branch network, develop products, increase corporate lending, and recruit employees,” Shao added.

Europe Turns To US For Loans (WSJ)
In the latest symptom of Europe’s financial turmoil, the region’s riskier companies are bypassing banks and investors at home and turning to the U.S. for loans. European companies borrowed some €14.4 billion (about $18 billion at current rates) in the U.S. leveraged-loan market this year through Friday, more than double the €6.7 billion for all of 2011, according to data from S&P Capital IQ LCD. That is the highest amount since at least 2007, the height of the last boom in leveraged lending, when full-year loan volume was €12.2 billion, according to S&P.

How Boaz Weinstein And Hedge Funds Outsmarted JPMorgan (NYT)
By May, when fears over Europe’s debt crisis again came to the fore, the trade reversed. The London Whale was losing. And Mr. Weinstein began to make back all of his losses — and then some — in a matter of weeks. Other hedge funds were also big winners. Blue Mountain Capital and BlueCrest Capital, both created by former JPMorgan traders, were among those winners. Lucidus Capital Partners, CQS and a fund called III came out ahead, too. Inside the hedge fund world, some joked that Mr. Weinstein had been able to spot the London Whale because he himself had been a whale once, too.

Drunk Brooklyn woman crashes car through Long Island home (NYDN)
A drunken Brooklyn woman crashed her Mercedes into a Long Island home Monday, smashing through the house and landing in the backyard, cops said. Sophia Anderson, 21, failed to turn left or right when the road she was driving on in Huntington deadended at a T-intersection with another street, officials said. She left a train of wreckage as she smashed through the modest house on Southdown Rd., missing the 90-year-old homeowner and her caretaker. Anderson, treated and released at Huntington Hospital, was arrested and charged with driving while intoxicated, police said.

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69 Responses to “Opening Bell: 05.29.12”

  1. guest says:

    If anyone told me that driving your car through someone's house was frowned upon…

  2. Duffer says:

    The Euro 5 cent coin will always be in demand as a ball marker.

  3. Guest says:


  4. The Truth says:

    “I would never put big money into the stock market”, says odd lot buying Canadian actor, who probably lost about $45 for his troubles.

    Worst. Example. Ever.

    • B. Madoff says:

      Do you have any idea how many cappuccinos you can buy in Canada for $45?

      I support the Canadian acting community in these challenging times, and hope that we, as a society can move forward into more modern, efficient forms of investment.

    • Guest says:

      15 shares * IPO price of $38/share = $570

      15 shares * current market price of ~$30/share = $450

      Estimated mark-to-market losses : $570 – $450 = $120

      This correction has been brought to you by a representative of the MBAs > CFAs Institute.

      • D$$ says:

        plus $20 in round-trip brokerage commissions.

        -guy who spent $3k on qualifying credentials for "CFA or MBA preferred" job listings instead of $100k

  5. Guest says:

    There's a nice big empty building in Stamford where zoo animals can live.. Maybe teach them to use terminals and never ask for bonuses… win-win!

  6. Should be studying says:

    So, how many people are reading this on their couch, despite the fact that they took the week off work to study for the CFA exam?

    -Person in that group

  7. guestimate says:

    I'm not your guy, friend!

  8. VonSloneker says:

    He added that Greek society was built on cheating and scheming, saying “everyone does it”

    This is an outrage, how dare you malign the Greek people in…aww who am I kidding, he's right.

    – The Ghost of Aristotle Onassis

  9. Shecky Half says:

    A Houston executive recruiter dies on an exclusive country club golf course and goes to Heaven. There he meets St. Peter at the Pearly Gates. St. Peter says, "We've got a new policy in effect: You get to spend one day in Heaven and one day in Hell. At the end of both experiences you get to pick where you'll be for eternity. "

    The recruiter spends the first day in Heaven, lazing about, playing a harp, getting fitted for wings and long white robes.

    The next day, the recruiter is sent to Hell. When the elevator door opens, the Devil meets him with tequila shooter girls. They get in a plane with female pilots who are topless and fly to the Amazon to do some Peacock bass fishing. Then they go to the Kentucky Derby and get to party in the Ashland suite. Finally they go to Las Vegas and get comped all the money they ask for tob gamble the night away before going back to Heaven.

    Next day, St. Peter asks the recruiter to make the decision. The recruiter says, "You know….I never thought I'd say this but the experience in Hell was just so unique…I…I…I think I'm going to go with Hell for eternity"

    Down the elevator he goes and when it opens he sees a vast burning wasteland of dirty people screaming and picking up trash, doing menial tasks for scraps of food and little water. The recruiter turns to the Devil and says, "Hey!! This isn't like the experience of the other day!!!"

    Devils says, "Yesterday you were being recruited. Today you are staff."

  10. Guesticulate says:

    “There’s absolutely no reason for people in the United States to get all in a dither,” Federal Reserve Bank of Philadelphia President Charles Plosser said in an interview with The Wall Street Journal. "A tizzy I can understand, but a dither? Certainly not warranted."

  11. Driver says:

    I remember my first beer.

  12. Guest says:

    I'm not your buddy, pal!

  13. Guest says:

    Sophia Anderson is a friend of mine.

    B. Joel

  14. Sherwood says:

    I don't know if anyone in the CNBC control booth keeps an eye on this blog, but Jim Cramer is really MANIC this morning. It's as if the guy is really losing it. I don't subscribe to PC correctness, and I like Jim. I went to school with Jim. Something is wrong and I fear we are watching a train wreck about to happen. His alluding to the Facebook problem as people "hanging from the rafters" ; he just finished some allusion to "scorched-earth" and "the Ho Chi Min trail" . The allusions may be insensitive, but that is not the point. The point is they really are meaningless ramblings and stupid things to say on the air. The other newscasters on the desk are struggling to reign him in– they can't. Clearly they are embattled. Wow folks this is bad, really bad. I wonder if Jim Cramer can save himself, or will anyone step forward to save him.

    • Guest says:

      Wait, WHAT? Cramer is worked up about something? Jesus Christ, you're right, this is serious. SOMEBODY! HELP!! Can anyone reading this at CNBC pull the plug? Shoot him with a tranq dart?? ANYTHING!

    • VonSloneker says:

      He seems fine to me

      – Guy sitting on linoleum floor drinking cheap scotch

  15. Texashedge says:

    "David Guthrie, a 30-year-old waiter in Toronto, bought 15 shares of Facebook on its opening day."

    / Fixed

  16. Laxbro says:

    Took a single-prop to Kennebunkport on Friday. We’re late, my Mom is already bitching. Good to see you too, have another zanny. Lots of bourbon and bad decisions later I’m talking to some Bowdoin slam – strong 5.5. I tell her I'm 24, she says I look 26. She sleeps with her mouth open. Tuesday morning breakfast is Advil and an Americano. Good luck to all the CFA bros.

  17. R. Stildolph says:

    I'd hit it.

  18. Guest says:

    "All in a dither"? Really? That's a thing people say now?

  19. iGuest says:

    There aren't nearly enough stories on DB about macaque.

  20. Jack P. says:

    A happy trading day today, all are up except for social media shares.<img src=> <img src=>

  21. Anonymous says:

  22. Anonymous says:

    order by 1000/*