Opening Bell: 12.20.12

Report Says Libor-Tied Losses at Fannie, Freddie May Top $3 Billion (WSJ)
Fannie Mae and Freddie Mac may have lost more than $3 billion as a result of banks’ alleged manipulation of a key interest rate, according to an internal report by a federal watchdog sent to the mortgage companies’ regulator and reviewed by The Wall Street Journal. The unpublished report urges Fannie and Freddie to consider suing the banks involved in setting the London interbank offered rate, which would add to the mounting legal headaches financial firms such as UBS AG and Barclays face from cities, insurers, investors and lenders over claims tied to the benchmark rate.

Libor Documents May Boost Civil Suits (WSJ)
Analysts have published a range of estimates of the potential impact to the industry of lawsuits stemming from the manipulation—in some cases they reach into the tens of billions of dollars or more. It likely will be years before the extent of any liabilities becomes clear. For the lawsuits to succeed, plaintiffs must prove that banks successfully altered the interest-rate benchmarks and caused the plaintiffs to suffer a loss. Michael Hausfeld, chairman of Hausfeld LLP, a co-lead counsel on one of the lawsuits, said the UBS settlement was “extremely useful” for the litigation. The “extraordinary emails” published by the regulators exposed the “pervasiveness of the culture and the activity.”

UBS Trader Hayes Exposed at Core of Libor Investigation (Bloomberg)
Tom Hayes, one of two former UBS AG traders charged by U.S. prosecutors, is portrayed by American regulators as the kingpin of a three-year campaign that succeeded in manipulating global interest rates. Hayes, 33, was charged with wire fraud and price-fixing, the Department of Justice said in a criminal complaint unsealed yesterday. The trader and Roger Darin, a former short-term interest-rates trader at UBS whose responsibilities included the firm’s yen Libor quotes, were also charged with conspiracy…Hayes colluded with brokers, counterparts at other firms and his colleagues to manipulate the rate, the Justice Department said. Between 2006 and 2009, a UBS trader made at least 800 requests to the firm’s yen Libor rate-setters, about 100 to traders at other banks, and 1,200 to interdealer brokers, according to the Commodity Futures Trading Commission, which didn’t identify Hayes by name. “Many UBS yen derivatives traders and managers were involved in the manipulative conduct and made requests to serve their own trading positions’ interests,” the CFTC said. “But the volume of unlawful requests submitted by one particular senior yen derivatives trader in Tokyo dwarfed them all.”

IntercontinentalExchange Agrees to Acquire NYSE Euronext (Bloomberg)
IntercontinentalExchange Inc., the 12-year-old energy and commodity futures bourse, agreed to acquire NYSE Euronext for cash and stock worth $8.2 billion, moving to take control of the world’s biggest equities market. ICE, based in Atlanta, will pay $33.12 a share for the owner of the New York Stock Exchange, 38 percent above yesterday’s closing price, according to a statement today. Both boards approved the proposal and the companies expect to complete the transaction in the second half of 2013. Last year, the U.S. Justice Department blocked a joint hostile bid by ICE and Nasdaq OMX Group for the New York-based company on concern the combination would dominate U.S. stock listings.

Greece Faces ‘Make or Break’ Year (FT)
We can make it next year if we can stick to the program agreed with the EU and IMF,” finance minister Yannis Stournaras said in an interview with the Financial Times. However, “the break would be if the political system finds the situation too difficult to handle”, he added, referring to the danger of social unrest about austerity that could force the two left-of-center parties to bring down the governing coalition. “What we have done so far is necessary but not sufficient to achieve a permanent solution for Greece,” Mr Stournaras said. “The issue now is implementation.”

Boehner’s ‘Plan B’ Gets Pushback (WSJ)
The mood at the White House was gloomy, while on Capitol Hill it fluctuated. Few seemed confident the nation would avoid the tax increases and spending cuts known as the fiscal cliff, but others noted major Washington deals are usually reached only after several near-death experiences.

Preparing for the World’s End, Just in Case (WSJ)
Tony Brown, a private investigator in Southern California, says he has spent nearly $60,000 preparing for Teotwawki — an acronym for “the end of the world as we know it”—or SHTF—when the “s— hits the fan.” Mr. Brown has purchased an ultralight plane and amassed three tons of food in his kitchen, about a third in freeze-dried meals. About a year ago, Mr. Brown started a website to recruit a community of preppers to plan for a cataclysm. In the first several months, he said he received few inquiries. But by the summer, traffic to the site soared and applications have come rolling in since. He recently capped the group at 175 members—all are responsible for their own one-year supply of food—though he is still seeking a doctor, meteorologist and ham-radio operator. Mr. Brown has contingency plans for four doomsday scenarios he deems most likely—a supervolcano, solar flare, major earthquake or hyper inflation—and a large underground bunker in case of a nuclear attack. He doesn’t believe the world will end on Dec. 21, “but, just in case, I want to have everything ready by then,” he said.

US Economy Grew 3.1%; Jobless Claims Rise (Reuters)
Weekly jobless claims rose to 361,000 in the latest week. Claims has been expected to rise to 357,000, from 343,000 the prior week.

BofA’s Moynihan Said to Kill Proposal to Cut Pay for Brokers (Bloomberg)
Bank of America Corp. Chief Executive Officer Brian T. Moynihan blocked a proposal to cut the main component of most brokers’ pay for 2013, said a person with direct knowledge of the matter. The plan would have reduced the so-called grid payout for Merrill Lynch financial advisers by two percentage points, the person said, requesting anonymity because it wasn’t made public. The changes, which would have affected advisers generating less than $1 million in commissions, were seen as a way to cushion the costs of new bonuses, the person said.

In $18 Million Theft, Victim Was a Canadian Maple Syrup Cartel (NYT)
It was an inside job of sorts. Thieves with access to a warehouse and a careful plan loaded up trucks and, over time, made off with $18 million of a valuable commodity. The question is what was more unusual: that the commodity in question was maple syrup, or that it came from something called the global strategic maple syrup reserve, run by what amounts to a Canadian cartel. On Tuesday, the police in Quebec arrested three men in connection with the theft from the warehouse, which is southwest of Quebec City. The authorities are searching for five others suspected of being involved, and law enforcement agencies in other parts of Canada and the United States are trying to recover some of the stolen syrup. Both the size and the international scope of the theft underscore Quebec’s outsize position in the maple syrup industry. Depending on the year, the province can produce more than three-quarters of the world’s supply. And its marketing organization appears to have taken some tips from the producers of another valuable liquid commodity when it comes to exploiting market dominance. “It’s like OPEC,” said Simon Trépanier, acting general manager of the Federation of Quebec Maple Syrup Producers. “We’re not producing all the maple syrup in the world. But by producing 70 to 78 percent, we have the ability to adjust the quantity that is in the marketplace.”

NYers who believe in Mayan apocalypse search for sex before the world ends (NYP)
While some people around the world are arming themselves and digging into bunkers, many New Yorkers are simply hoping for a hot time. “I will be looking for an end-of-the-world hook-up,” Dennis Cintron, 29, a Lower East Side bartender, told The Post. “If you’re going to go out, go out with a bang.” Cintron said he’ll buy new clothes and get a haircut for the big day because he wants some “companionship” to ring in the rapture. Sara Saperstein, 26, of Bushwick is also hoping for one last romp. “It’s like New Year’s. I want to go out on a wild note!” Saperstein said. She won’t have trouble finding a spot for that. More than a dozen bars and clubs in New York City are throwing end-of-days bashes, including a comedy show at the Bell House in Gowanus and an “End of the Funking World Party” at B.B. King Blues Club in Midtown. Other singles posted ads on Craigslist.org and OKCupid.com, seeking apocalypse-themed dates, “casual encounters” and even “end of the world sex.” “If you’ve got no plans for the apocalypse, let’s get together,” wrote a 30-year-old single guy from Midtown. He added, “Send me how you’d like to spend your last hours on earth — and a photo.”

50 comments (hidden to protect delicate sensibilities)
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Comments (50)

  1. Posted by Lasalle Street | December 20, 2012 at 9:19 AM

    bye NYSE

    wall street is oooover

    no one dicks around with individual issues anymore

    tail has eaten dog

    futures baby

    Corzine fucked up a major chance at a comeback

  2. Posted by Ian Gallagher | December 20, 2012 at 9:25 AM

    NYX shareholders received a Christmas miracle. ICE is WAY overpaying for that mismanaged piece of shit. All you stupid guineas and Irish drunks TAKE THE MONEY AND RUN! Hear me Vinnie Farina, Art Cashin, Frank Degarcia And all you other mongoloids?

  3. Posted by guest | December 20, 2012 at 9:31 AM

    wow.

  4. Posted by Evil David Letterman | December 20, 2012 at 9:37 AM

    Hey, if I could just say one thing. Lois –you know –the mom from “Malcolm in the Middle”? Well I got to say, I just could never masturbate to her. Did not matter what time of day an episode was playing. She uh, she just never got the uh blood flowing and I can’t be the only guy (or girl) who felt that way.

  5. Posted by Jane Kaczmarek | December 20, 2012 at 9:46 AM

    Since we're being honest Dave I always felt the same way about you too.

  6. Posted by Dabears | December 20, 2012 at 9:47 AM

    Have another Old Style and a brat and STFU

    - Guy who all too well understands why they call it the Second City

  7. Posted by Guest | December 20, 2012 at 9:53 AM

    what the eff is going on this morning?

  8. Posted by Quant me maybe | December 20, 2012 at 9:53 AM

    I think that Ian would have been much more persuasive if he had used ALL CAPS.

  9. Posted by UBS | December 20, 2012 at 10:01 AM

    the dream is dead

    gig is up

    I Banking no more

  10. Posted by Lasalle Street | December 20, 2012 at 10:02 AM

    truth hurts jizz boy

    those guys blew out here years ago

    towers baby

  11. Posted by Guest | December 20, 2012 at 10:04 AM

    Dick Bove hasn't published in a while and the readership is restless.

  12. Posted by Enron Ethics | December 20, 2012 at 10:11 AM

    “And then some trader does some stupid thing like this guy at UBS did…….."

    So, when he made the comment, was Jimmy Gorman talking about Tom Hayes?

  13. Posted by UBS | December 20, 2012 at 10:15 AM

    laugh now. but spesh divs and carried interest is next thru reg.

    that ends the alpha creators racquet.

    m&a also going internal now salaried guys who actualy know the biz and competitors, self financed, still need sharks but that's a fraction of the juice the banks get

  14. Posted by Tony Brown | December 20, 2012 at 10:17 AM

    Teotwawki = “the end of the world and we're killing it”

  15. Posted by el invitado | December 20, 2012 at 10:20 AM

    When zerohedge invades dealbreaker.

  16. Posted by Tim Shatz | December 20, 2012 at 10:21 AM

    Take the tinfoil hat off your head and get back to work.

  17. Posted by PermaGuestII | December 20, 2012 at 10:22 AM

    Top 5 shareholders of NYX are Wellington, Blackrock, Capital Research, Vanguard, and Franklin.

    Nice '90's-era agression, though.

  18. Posted by Shecky Van Gogh | December 20, 2012 at 10:24 AM

    A UBS trader was feeling stressed out about all the bad things being reported about UBS. So he decides to call a phone sex service. He explains what's been happening and how he is feeling to the "provider" on the other end of the phone. He says he needs some intense "dirty talk" to take his mind off the lack of respect he and his chosen career are receiving of late. The provider replies….."Not tonight. I have an ear ache….."

  19. Posted by Mr. G | December 20, 2012 at 10:28 AM

    Dear Tony,

    Call me.

  20. Posted by FICC Genius | December 20, 2012 at 10:28 AM

    "Alpha creators……"

    Oh, my sides…

  21. Posted by Guest | December 20, 2012 at 10:29 AM

    Me too!

    –Dr. Oz

  22. Posted by Ian Gallagher | December 20, 2012 at 10:29 AM

    SUCK MY IRISH COCK YOU SMARMY CUNT. How's that?

  23. Posted by Meh | December 20, 2012 at 10:30 AM

    Neither a thumbs up nor a thumbs down. "E" for effort, I guess.

  24. Posted by Ian Gallagher | December 20, 2012 at 10:30 AM

    Yeah? I'd like to know their cost basis. Asshole.

  25. Posted by end of days ny | December 20, 2012 at 10:39 AM

    you're both ignorant savages.

    these are just index mutual funds

    duuuuuuhhhhhhhh

    you think balckrock and vangaurd sped ?

    u one dum bitch that for sure

  26. Posted by IBank desk | December 20, 2012 at 10:40 AM

    what work ?

  27. Posted by Giovanni | December 20, 2012 at 10:43 AM

    Agree.

    - Guy who came up prior to broadband internet and remembers how hard it used to be to wack off

  28. Posted by Vinnie Farina | December 20, 2012 at 10:45 AM

    Duncan Niederauer talking to scumbag Gasparino on CNBC. His face looks like a puckered asshole. He'll be gone by June.

  29. Posted by Guestido | December 20, 2012 at 10:46 AM

    Enough already

  30. Posted by Guest | December 20, 2012 at 11:01 AM

    Add Ren Stevens to that list.

  31. Posted by guest | December 20, 2012 at 11:02 AM

    beat me to it.

  32. Posted by Guest | December 20, 2012 at 11:08 AM

    Does this mean I have to add an "eh" to all my orders?

    -UBS Quant

  33. Posted by Jeff Sprecher | December 20, 2012 at 11:09 AM

    Blue star loves DNND AUG.puts (quieter)

  34. Posted by John Paulson | December 20, 2012 at 11:12 AM

    Hey!

    Im still ling GLD…ohh wait

  35. Posted by PermaGuestII | December 20, 2012 at 11:14 AM

    "Racquet"

    Court tennis, anyone?

    -The R&T

  36. Posted by Guesticle | December 20, 2012 at 11:23 AM

    That is sweet that authorities are getting to the bottom of the maple syrup heist. Things could've gotten really sticky.

  37. Posted by Guest | December 20, 2012 at 11:23 AM

    Saperstein sounds…exotic. I'm in.

  38. Posted by woody johnson | December 20, 2012 at 11:38 AM

    Tell me about it.

  39. Posted by Guest | December 20, 2012 at 11:39 AM

    +1

  40. Posted by PermaGuestII | December 20, 2012 at 12:30 PM

    A Jewish woman living in Brooklyn strikes you as exotic?

    You must not get out much.

  41. Posted by Kuwait | December 20, 2012 at 12:52 PM

    Hey !

  42. Posted by inlovewithpmco | December 20, 2012 at 1:22 PM

    PMCO if this is the last day before the end of the world, can I spend it with you?

  43. Posted by LetsBreel | December 20, 2012 at 1:49 PM

    The free clinic is gonna be sooo busy this Saturday.

  44. Posted by Sleeper | December 20, 2012 at 2:20 PM

    Sara, call me.

    - Guy who's banking on the apocalypse so his embarrassment will be short-lived after giving Sara Saperstein the worst two minutes of her life

  45. Posted by HungryIntern | December 20, 2012 at 2:26 PM

    Every time I hear the words "Plan B", this is what I think of http://planb-club.com/ and not some half thought out plan that not even your own members would vote for…

    If you are afraid of opening the link you can Google the address; "11637 West Pico Boulevard, Los Angeles, CA 90064"

  46. Posted by Guest | December 20, 2012 at 2:49 PM

    Hey!

    -Bronze medal winner for badminton at the Maccabiah Games

  47. Posted by Refffeerr | December 20, 2012 at 4:27 PM

    +1 for jizz boy

  48. Posted by Guest | December 20, 2012 at 5:12 PM

    Really? Not the morning after pill?

    - Guy with a "Sunday morning scare" under his belt

  49. Posted by Guest | December 20, 2012 at 5:21 PM

    a scare? fuck i have like 12.

  50. Posted by Guest | December 20, 2012 at 7:33 PM

    I don't really sweat it too much.

    - Antonio Cromartie