Opening Bell: 11.19.12

Geithner: Deal To Avoid ‘Fiscal Cliff’ Can Be Made In Weeks (Bloomberg)
Treasury Secretary Timothy F. Geithner said he’s confident an agreement on averting the fiscal cliff can be concluded within weeks after White House talks between President Barack Obama and congressional leaders. “It was a good meeting, and the tone was very good,” Geithner said in an interview in Washington. “I think this is doable within several weeks.” Geithner said a deal must be reached soon to prevent further damaging consumer confidence. The lack of agreement is “this huge cloud of uncertainty hanging over the economy,” he said. As the peak of holiday shopping season approaches, “You’d want to do it as soon as you can.” “This is within our grasp, within our reach,” Geithner said. “It’s not that complicated.” Geithner repeated the administration’s calls for an immediate extension of middle-class tax cuts, and said a deal on high-end tax cuts shouldn’t be delayed. “I think deferring things doesn’t work,” he said. “You know, we’ve had several periods now where there was a choice made to defer.”

Obama Calls CEOs, Including Buffett, Dimon (Politico)
President Obama made calls to a handful of top business leaders over the weekend, a White House official said Sunday, as part of effort to build support for his approach to averting the fiscal cliff. In conversations that came during his weekend of travel to and in Asia, Obama stressed “the need to find a balanced deficit reduction solution that protects the middle class and continues to move our economy forward,” the official said. Obama spoke to Berkshire Hathaway CEO Warren Buffett, Apple CEO Tim Cook, JPMorgan Chase CEO Jamie Dimon, Boeing CEO Jim McNerney and Costco CEO Craig Jelinek, the official said.

Lagarde: Reality’ Not ‘Wishful Thinking’ Needed on Greece (Reuters)
“I am always trying to be constructive but I am driven by two objectives,” Lagarde said in an interview, “to build and approve a program for Greece that is solid, that is convincing today, that will be sustainable tomorrow, that is rooted in reality and not in wishful thinking.

Investment Falls Off A Cliff (WSJ)
U.S. companies are scaling back investment plans at the fastest pace since the recession, signaling more trouble for the economic recovery. Half of the nation’s 40 biggest publicly traded corporate spenders have announced plans to curtail capital expenditures this year or next, according to a review by The Wall Street Journal of securities filings and conference calls.

Sahara Feeling Heat Over Bond Sales (WSJ)
India’s Sahara Group has built an empire by offering financial products to tens of millions of rural Indians who typically stashed their meager savings under the mattress. Business was so good that Sahara, using fees and investments from its customers’ deposits, grew into a multi-billion-dollar conglomerate that includes a 10,000-acre township, New York’s Plaza Hotel building and a Formula-1 racing team. Today, the company’s practices are coming under intense public scrutiny, the product of years of tussle between Sahara and regulators who worry India’s informal financial sector has grown dangerously fast and without oversight. Many savers who scraped together money to put with Sahara now fear they could face lengthy delays in getting their money back.

Opportunists Stockpile Twinkies for Big Payday (AP)
Hours after the maker of Twinkies, Hostess Brands, announced its plans to close forever, people flocked to stores to fill their shopping baskets with boxes of Twinkies, which are cream-filled sponge cakes, and other snacks made by the company — Ding Dongs, Ho Hos and Zingers. Late Friday and Saturday, the opportunists took to the Web sites eBay and Craigslist. They began marketing their hoards to whimsical collectors and junk-food lovers for hundreds, in some cases thousands, of dollars. That is a fat profit margin, considering the retail price for a box of 10 Twinkies is about $5.

Bond Investor Takes Big Punt On Ireland (FT)
Franklin Templeton funds increased their holdings of Irish bonds by more than a third to at least €8.4 billion in the third quarter. This means that the San Francisco-based US asset manager now controls almost a 10th of Ireland’s entire government bond market. Most of the bonds have been snapped up by funds controlled by Michael Hasenstab, co-director of Franklin Templeton’s international bond department, and particularly by the $64 billion Templeton Global Bond Fund he manages.

Kim Kardashian Weighs In On The Israeli-Palestinian Conflict (HP)
Kim Kardashian is apparently neutral when it comes to the current Israeli-Palestinian conflict. The reality star first tweeted support for Israel: “Praying for everyone in Israel,” she wrote. And after five minutes of backlash, the star tweeted again: “And praying for everyone in Palestine and across the world!” she wrote. Kardashian is clearly the last person anyone wanted to hear from regarding the issue, and the 32-year-old was immediately hit with more backlash over the tweets — including death threats. The star has since deleted the tweets and explained her reasons for tweeting about the conflict in a blog post on her website.

Shadow Banking Grows to $67 Trillion Industry, Regulators Say (Bloomberg)
The shadow banking industry has grown to about $67 trillion, $6 trillion bigger than previously thought, leading global regulators to seek more oversight of financial transactions that fall outside traditional oversight. The size of the shadow banking system, which includes the activities of money market funds, monoline insurers and off- balance sheet investment vehicles, “can create systemic risks” and “amplify market reactions when market liquidity is scarce,” the Financial Stability Board said in a report, which utilized more data than last year’s probe into the sector. “Appropriate monitoring and regulatory frameworks for the shadow banking system needs to be in place to mitigate the build-up of risks,” the FSB said in the report published on its website.

Lehman Trustee Ends Citigroup Fight (WSJ)
The trustee unwinding Lehman Brothers Inc. reached an agreement with Citigroup that ends a long-running legal fight over more than $1 billion that Lehman deposited at the bank the week it filed for bankruptcy protection. The deal puts $435 million in the coffers of Lehman’s brokerage unit, LBI, for distribution to customers and other creditors, according to the settlement filed Friday night in U.S. Bankruptcy Court in Manhattan.

Europe Seeks More Taxes From US Multinationals (NYT)
Google, Amazon, Starbucks and other American companies facing tax scrutiny say they are doing nothing wrong. They use complex accounting strategies to exploit national differences across Europe in corporate tax rates, which range from less than 10 percent to more than 30 percent, and loopholes that can reduce their effective European tax levies to almost nothing. Google, for example, records most of its international revenue at its European headquarters in Ireland, where the corporate tax rate is 12.5 percent. Across Europe, customers who buy advertising, Google’s primary source of revenue, sign contracts with the company’s subsidiary in Ireland, rather than with local branches. Google ends up paying Irish taxes on only a fraction of the billions of euros that course through its Dublin office. That is because the company uses a variety of methods, including royalty payments to a unit in Bermuda, to reduce further the amount of money exposed to tax liability. So, while Google told the Securities and Exchange Commission that it generated more than $4 billion in sales in Britain last year, it reported revenue of only £396 million, or $629 million, in its official filings there.

Central New York district attorney Marc Suben admits to ’70s porn star past (NYDN)
Prior to this year’s election, Marc Suben denied appearing in 1970s skin flicks, telling reporters he was the subject of a campaign by political rivals who wanted to sully his reputation. But Friday, CNYCentral.com published a story highlighting a YouTube video comparing Suben with porn actor Gus Thomas, whose IMDB film credits include “Deep Throat Part 2” and “Doctor’s Teenage Dilemma.” Suben swiftly called a press conference and “humbly” apologized to those he had deceived. He admitted to using “bad judgment” both by appearing in adult films in his youth and by lying about them as a public official. He was first elected in 2008. “I was shocked and embarrassed to be confronted with this so many years later,” said Suben, who has also served as a judge. “I was embarrassed for my family and friends who stood by me. I also denied my actions to my family, my friends and my staff.” He declined to say whether he plans to resign.

32 comments (hidden to protect delicate sensibilities)
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Comments (32)

  1. Posted by Little Fritz | November 19, 2012 at 7:18 AM

    Kardashians to Gaza! (and leave there)

  2. Posted by investorcluzo | November 19, 2012 at 8:09 AM

    It's okay to *hide* your past work history…just don't try to tell us you have a computer science degree from a school that didn't offer that field of study.
    -D. Loeb

  3. Posted by El Guesto | November 19, 2012 at 8:31 AM

    That's what we called 'women studies' back in the 70's…

  4. Posted by guestosaurus | November 19, 2012 at 8:42 AM

    this candy is taking me way back to the playground, those were the days… getting your ding dong twinkied by a ho ho, in return for a zinger..

    snoop puppy

  5. Posted by Cliff Assness | November 19, 2012 at 8:51 AM

    I stopped reading at Kim Kardashian. What the fuck is wrong with America?

  6. Posted by enews | November 19, 2012 at 8:55 AM

    you guys need to merge and form kliff kardassness

  7. Posted by United States | November 19, 2012 at 8:57 AM

    mass immigration

  8. Posted by Guest | November 19, 2012 at 9:06 AM

    "Kim Kardashian Weighs In On The Israeli-Palestinian Conflict"

    After reading the title, the article that followed was actually exactly what I was expecting.

  9. Posted by C. Christie, CFA | November 19, 2012 at 9:18 AM

    I for one am eagerly looking forward to a 5 chart, 15+ footnote post on the current state of the Twinkie market and the highly levered derivative that Matt is now offering to accredited investors to allow them capture the upside of Twinkie appreciate while hedging their downside through Ho-ho and ding dong options.

  10. Posted by guest | November 19, 2012 at 9:47 AM

    TWINKIES! They get me off! Dan White

  11. Posted by guest | November 19, 2012 at 9:48 AM

    TWINKIES! They get me off! Dan White

  12. Posted by DB IT Hamster | November 19, 2012 at 9:54 AM

    God I hate Mondays. Sorry all.

  13. Posted by DB's IT Department | November 19, 2012 at 11:11 AM

    See what happens when you relocate us to Gaza? Damn Matt and his budget-busting Bloomberg !

  14. Posted by Anonymous | November 19, 2012 at 11:14 AM

    Bring back the comment system so I can downvote 4

  15. Posted by Anonymous | November 19, 2012 at 11:15 AM

    Bring back the comment system so I can downvote @4

  16. Posted by Shecky Seville | November 19, 2012 at 11:22 AM

    So a young investment banker goes to a local barbershop for a haircut. When it is his turn, he sits in the barber chair and gives the barber his hair preferences. After the barber has been clipping for a while, the seated investment banker pulls out a Hostess Twinkie and begins to eat it. The barber says, “Sir, you do know you’re going to get hair on your Twinkie?” The young investment banker replies, “Dude…I’ve been through puberty!”

  17. Posted by Hakuna Matata Guy | November 19, 2012 at 11:23 AM

    @7 -1

  18. Posted by guest | November 19, 2012 at 11:25 AM

    ^^ i dunno, i laughed at it..

  19. Posted by Anonymous | November 19, 2012 at 11:48 AM

    @19 – Wedding reception battle with N’08 and Laxbro over the maid of honor

  20. Posted by The Dude | November 19, 2012 at 11:57 AM

    @19…..park it at Fire Island

  21. Posted by FinkNottle | November 19, 2012 at 12:00 PM

    This country needs a Fiscal Assness

  22. Posted by Guest | November 19, 2012 at 1:01 PM

    Waah!

  23. Posted by F9_Calculate | November 19, 2012 at 1:35 PM

    I speculate that the twinkie® market has a Sno Balls® chance in hell at making a full recovery

  24. Posted by lucas | November 19, 2012 at 1:36 PM

    Taking a big punt?

  25. Posted by guest | November 19, 2012 at 1:54 PM

    TWINKIES! They get me off!
    Dan White

  26. Posted by DB IT HAMSTER | November 19, 2012 at 1:55 PM

    God I hate Mondays. Sorry all.

  27. Posted by anonymous | November 19, 2012 at 1:55 PM

    Bring back the comment system so I can downvote 4

  28. Posted by Voting Addict | November 19, 2012 at 1:57 PM

    Without IntenseDebate how will I be able to validate my manhood?

  29. Posted by guest | November 19, 2012 at 2:53 PM

    Hey !

    – headband chick

  30. Posted by Omar | November 19, 2012 at 3:51 PM

    And do not kill the soul which Allah has forbidden

  31. Posted by Obvious | November 19, 2012 at 6:48 PM

    Tallahassee: [discovers Hostess truck filled with Sno-Balls] Sno-Balls? Sno-Balls? Sno Balls? Where's the fucking Twinkies?
    Columbus: I love Sno-Balls.
    Tallahassee: I hate coconut. Not the taste, consistency.
    Columbus: [eats a Sno Ball] Fresh.
    Tallahassee: Oh, this Twinkie thing, it ain't over yet.

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