Opening Bell: 01.11.13

Wells Fargo Profit Rises as Bank Gains From Refinancing (Bloomberg)
Net income advanced to a record $5.09 billion, or 91 cents a share, from $4.11 billion, or 73 cents, a year earlier, the San Francisco-based bank said today in a statement. That beat the 89-cent average estimate of 27 analysts surveyed by Bloomberg, some of whom were excluding one-time costs tied to a regulatory settlement.

SAC Is Bracing For Big Exodus Of Funds (WSJ)
Hedge-fund group SAC Capital Advisors has told employees and business partners it is bracing for client withdrawals of at least $1 billion this year—nearly 17% of the money it manages for outside investors—amid intense regulatory scrutiny of alleged insider trading, people briefed on the conversations said…SAC manages $14 billion in total, but only around $6 billion comes from outside investors, most of the rest belonging to Mr. Cohen and SAC employees. Clients have until Feb. 15 to put in a redemption request to receive money by the first quarter’s end; it is likely even SAC won’t know the precise figure that investors will ask to pull until then. However, in recent weeks the firm’s executives have been alerting advisers and senior employees that the withdrawal requests, known as “redemptions” in the hedge-fund industry, could total $1 billion or more. At the same time, SAC’s top ranks have been reaching out to investors to gauge whether they want to keep their money with the firm or not, the people briefed said.

Geithner’s Tenure Defined by Financial Crisis (NYT)
Looking back, he is remarkably sanguine. He is comfortable with his decisions: the policy choices available to him were far from ideal, he said, but his team did the best it could within the realm of the politically possible. “It was a very bad crisis. No playbook. No road map. No clear precedent,” he said. “If we had a different set of constraints, particularly in fiscal policy, then I think that the economic outcome could have been modestly better.”

Herbalife defends its honor as Ackman presses case (Reuters)
Herbalife Ltd executives defended their business on Thursday as a “legitimate company” with customers outside the network of people who sign up to sell its nutrition products, stepping up the defense against pyramid scheme accusations by short seller Bill Ackman…minutes after the company’s presentation ended, Ackman’s hedge fund claimed Herbalife did not answer Pershing Square’s points as it said it would. “The company distorted, mischaracterized, and outright ignored large portions of our presentation,” Ackman said in a statement.

British Panel Castigates Ex-UBS Officials at Hearing (Dealbook)
“What we have heard are appalling mistakes that can only be described as gross negligence and incompetence,” said Andrew Tyrie, a politician who leads the Parliament’s commission on banking standards that is investigating wrongdoing at the firms operating in London. “The level of ignorance seems staggering to the point of incredulity.”

Nicky Hilton’s ex to face off against alleged filching assistant (NYP)
Hedge funder Todd Meister — the ex-husband of Nicky Hilton — now has a courtroom Valentine’s date with his accused embezzling “personal” assistant. A Manhattan judge today set Feb. 14 as the trial date for the allegedly filching assistant, Ukranian beauty Renata Shamrakova, accused of swiping $900,000 from Meister. Prosecutors say Shamrakova had no authority to ring up the nearly $1 million in expenses on Meister’s credit card. Shamrakova counters that she was only hired in the first place to be Meister’s very personal assistant. Meister let her run up the card as a gift during the course of their romantic relationship, she says.

Wads Of Cash Squeeze Bank Margins (WSJ)
Deposits reached a record $10.6 trillion at the end of 2012, according to Market Rates Insight Inc., a San Anselmo, Calif., firm that tracks deposit data. Meanwhile, the share of each deposit dollar that banks lend out hit a postfinancial-crisis low in the third quarter, according to data tracker SNL Financial of Charlottesville, Va. Extra cash can help cushion banks in an economic downturn, but it also helps to explain why banks’ net interest margin—the sum they collect by pocketing the difference between the interest they pay to depositors and the rate they charge borrowers—has fallen sharply. Wells Fargo has been among the hardest hit in recent quarters, with its net interest margin falling to 3.66% in the third quarter from 3.84% a year earlier.

A Hawk Assails Easy Money (WSJ)
Esther George, president of the Federal Reserve Bank of Kansas City, stepped forward as a new, high-profile internal critic of the Federal Reserve’s easy-money policies. Ms. George told an audience in Kansas City, Mo., Thursday that current Fed policies made her “uneasy” and warned that the Fed “must not ignore the possibility” that monetary policy could contribute to new bubbles that harm the financial system.

AmEx Cuts Jobs as Digital Age Transforms Travel Business (Bloomberg)
American Express Co. will eliminate 5,400 jobs this year, mostly in travel services, as consumers and businesses rely more on digital technology for bookings.

AC casinos were bad bet, with 8% revenue hit (NYP)
Hedge-fund high rollers who bet big on a comeback for Atlantic City’s casinos are watching their gambling profits dwindle. The city’s casino industry suffered its sixth straight decline last year, with winnings down 8 percent to $3.05 billion, the New Jersey Division of Gaming Enforcement said in its latest annual report, released yesterday. Even before Sandy laid waste to the city’s famed boardwalk and emptied its casinos, the gaming industry was down 4.8 percent through September, the regulator said. The numbers suggest the odds are increasingly stacked against deep-pocketed backers who play a key role in reviving the city’s fortunes. They include Marc Lasry’s $12 billion Avenue Capital, a big investor in Trump Entertainment, which owns Trump Taj Mahal and Trump Plaza. Lasry led a group of investors who brought Trump Entertainment out of bankruptcy in 2010. Billionaire investor Carl Icahn owns Tropicana Casino and Resorts, which he bought out of bankruptcy in 2010. Lasry’s Trump Taj Mahal saw casino winnings fall 15 percent last year, while Trump Plaza was down 25 percent, according to yesterday’s report. Icahn’s Tropicana fell 9.8 percent.

Lew’s Lack of Geithner Global Rolodex Not Biggest Hurdle (Bloomberg)
Geithner’s expertise ensured that his foreign counterparts would consider his views. Still, he was often frustrated that the euro area didn’t move more forcefully to fight its sovereign debt crisis. Geithner’s cause was undermined by the U.S.’s trillion-dollar deficits and infighting over the budget, according to some European officials. Lew, 57, will face the same hurdle if he is confirmed by the Senate. “There is nothing gained by having someone who has a Rolodex and knows everyone around the world,” said Jacob Funk Kirkegaard, a senior fellow at the Peterson Institute for International Economics in Washington. “As the U.S. races to another cliff, its credibility is very small,” he said, referring to the budget disputes in Washington. Obama yesterday called Lew a “master of policy” in announcing that he will nominate his chief of staff to become the 76th U.S. Treasury secretary. Geithner will stay on through Jan. 25, according to a department official.

Man crashes into Lincoln Valentino’s restaurant, orders pizza (AP)
Lincoln, Nebraska police say a man crashed his car through the front door of a pizza restaurant before ordering a pie for himself. The man drove his Honda through a Valentino’s chain store Wednesday morning. While trapped in his car, the man ordered a pizza. Fire officials took it as a good sign that the man was alert. He was taken to a local hospital. No other injuries were reported. The building was not damaged structurally. No electrical or gas issues were reported.

41 comments (hidden to protect delicate sensibilities)
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Comments (41)

  1. Posted by Inner Matt Thoughts | January 11, 2013 at 9:39 AM

    Trivial use of the work day is nothing new at DB. Bess spends most of her time entering online sweepstakes and calling into various local radio stations trying to win concert tickets. From time to time, I find myself cornering unsuspecting building maintenance employees and spending 45 minutes discussing in a very thorough manor, why I love Basel III. Then there is Shazar. He is by far the worst or should I say best at it. It is not uncommon for him to be on the phone with his doggie day care asking if he can speak to his Chihuahua. He also tends to lock himself into the bathroom for extended periods of time claiming he has the stomach flu. Then he takes his lunch and goes to work out. Now nothing unusual about that –except he often disappears for about 3 hours. I approached him one day in the break room, telling him he must be getting into really good shape spending so much time at the gym. He quickly replied that he doesn’t go to the gym to work out per se; rather he just likes to get a good steam in. I let what he said sink in for a moment, and then I thought to myself: Is Shazar that guy who sits naked in the corner of the sauna, not saying a word just smiling?

  2. Posted by Lion dog | January 11, 2013 at 9:50 AM

    PS
    But hey it was either this or the Greg Smith route.

  3. Posted by Chase Debit Card | January 11, 2013 at 9:53 AM

    That's a nice credit limit Meister.

  4. Posted by Contestant Quant | January 11, 2013 at 9:56 AM

    Have you made a chart yet calculating the NPV of Bess' time spent entering these sweepstakes and making these calls? You probably should, not only would it be very helpful to her, but I'd love to see what's more valuable, a 1 in 100 million shot at winning a large monetary amount or 1 in 5 shot at tickets to Emma Lasry's first concert.

  5. Posted by Meister Meister | January 11, 2013 at 9:57 AM

    Filching / felching, same diff / no diff.

  6. Posted by VonSloneker | January 11, 2013 at 10:10 AM

    Whew, for a second there I thought they were talking about me

    – Nikki Hilton's ex's felching assistant

  7. Posted by WSJ Style Editor | January 11, 2013 at 10:12 AM

    "very thorough m-a-n-n-e-r"

  8. Posted by Guest | January 11, 2013 at 10:16 AM

    Stamford, Conneticut police say a man crashed his car through the front door of a restaurant before ordering 3 pies for himself. The man drove his BMW through a Dominio's chain store Wednesday morning. While trapped in his car, the man ordered 3 pizzas. Fire officials took it as a good sign that the man was alert, and were surprised that the man was going to eat all 3 pizzas himself. He was taken to a local hospital as the while finishing off the last of the pizza. No other injuries were reported. The building was not damaged structurally. No electrical or gas issues were reported. The man is also asking if anyone would like to invest in an opportunity.

  9. Posted by James S. Cramer | January 11, 2013 at 10:23 AM

    WELL ALL I CAN SAY IS BOOO YAAAA SKEE DADDY!!!! WHAT HAVE I BEEN TELLING YOU GUYS TO BUY THESE PAST FEW DAYS? YEP, YOU GUESSED IT. WFC!!! AND NOW LOOK THEY JUST DESTROYED THOSE EARNINGS!!!! I KNOW YOU MUST BE THINKING NOW… "DANG! HOW COCKANAMY IS THAT!" AND LEMMIE TELL YA SKEE DADDY IT'S COCKANAMY INDEED!!!

    OH YEAH AND WHILE WE'RE ON THE SUBJECT OF GOOD STOCKS TO BUY MAKE SURE YOU BUY FB!!! BUY WITH BOTH HANDS IF YOU HAVE TO!!! WE'RE GOING TO HAVE A COCKANAMY RUN WITH THIS ONE SKEEEEEE DADDEHHHH I JUST KNOW IT!!!

    YOURS TRULY,
    JIMBO <3

  10. Posted by Guest | January 11, 2013 at 10:24 AM

    Come to my remote lakeside cabin and we can discuss things in a very Thoreau manor

  11. Posted by Laxbro | January 11, 2013 at 10:28 AM

    I have to be honest, if I don't see anyone I know when I get to the gym, I'm inclined to steam, shower and go home. I remember when I used to care about pumping iron and whatnot, it was prep school. Everything since was just carry over. Anyways, these days the gym is full of 20-something clowns who can't give up the dream and are so bored in the monotony of their life that the athletic club is some escape for them to feel like the men they weren't in high school and college. Maybe one day my morning routine of a toasted bialy with regular cream cheese and venti, quad whole milk cappuccino will catch up to me, but it hasn't yet. Sometimes I'll fish for reassurance from whatever lucky lady I'm watching Friends reruns with and say, "I really need to start working out again." The last time I did that the smash puppy's response was, "Don't bother."

  12. Posted by Envisage | January 11, 2013 at 10:30 AM

    * Chokes out with both hands * * pauses then violently shakes to increase damage*

  13. Posted by Smallmouth | January 11, 2013 at 10:31 AM

    Come to my remote pond with a fishin' pole and we can discuss things in a very thorough "minner".

  14. Posted by Deposition | January 11, 2013 at 10:31 AM

    Mesister: Initially I found Ms. Shamrakova quite fetching, then I discovered the felching. It was often after the fucking.

  15. Posted by Guest | January 11, 2013 at 10:34 AM

    My eyes hurt having read that.

  16. Posted by segoviacobain | January 11, 2013 at 10:49 AM

    I was riding my fixed gear past the Herballife Distribution Center on Flatbush Avenue, on my way back to a squalid apartment and a tattooed hipster chick, when I thought to myself: I wonder what all those B school kids at work would say if they knew? Would they understand that I'd rejected the traditional objectives of those in the financial profession? Would they appreciate how my 100 dollar brooks brothers shirts looked in a hamper with my girlfriends hempwear and far too many stray chunks of IAMS? Could they ever possibly understand that my bathless bride was really my reaction to ten years of Carries Bradshaw? Perhaps they would appreciate my nonlinear approach to living, perhaps they'd have a name for that. A word flashed across the screen of my mind in bold red letters: "Douche".

  17. Posted by Worthwhile | January 11, 2013 at 10:52 AM

    I just literally don't exchange glances or words with anyone, and hit the treadmill for three miles on 7.5 to 8.0. Few machines rapidly, then steam. ( once a week or so. )

    Preserves sense of well being as I drink heavily, sit there tensely staring at screens all day.

    The gym is in my building, so mostly older people.

  18. Posted by qwestion | January 11, 2013 at 10:53 AM

    McD's Shamrakova Shake is my favorite.

  19. Posted by Plasma Selling FICC | January 11, 2013 at 10:57 AM

    I signed in, let them mark my small fingernail and began the 2 hour wait to sell my plasma. Today you get $40.00! I spent Thursday hydrating and this morning I had a nice breakfast so I should pass the blood sample tests easily. The place has been packed lately so it might be a 4 hour deal today. I see Frank and he gives me a wave and comes over. I met Frank a few weeks back while we were both waiting to be screened. He is a concrete contractor and the winter is a real slow period for his type of work. we are almost dressed in a similar manner. Scruffy clothes and worn out sneakers are preferable. I don't think Frank left his college ring at home like I did. He sees me checking my iPhone and mentions that he heard on TV that there are a lot of jobs in North Dakota in the oil fields. We talk about that and he wonders if he could sleep safely in his van in North Dakota winters. I tell him he ought to check online for job postings and he says he doesn't have a computer. I tell him to go to a library but I doubt if he will. He asks what's going on in the stock markets. I tell him that the market is relatively high compared to prior years and suggest he pay attention to the Baltic Freight Index and the S&P 500. He tells me that if he won the lottery he'd get his teeth fixed. The security guard comes in and tells the crowd watching ESPN on one of the flat screens in the room to "hold it down".

  20. Posted by Guestalt | January 11, 2013 at 11:00 AM

    Just thinking about what kind of lifeless fucktard has enough time to waste typing this shit out on a daily basis makes me want to hammerfist the nearest person in the face.

    Go orally copulate the nearest sensitive trigger firearm.

  21. Posted by Jerky | January 11, 2013 at 11:00 AM

    Please borrow Lady Gaga's "meat dress" and wear it on Safari.

  22. Posted by Guest | January 11, 2013 at 11:02 AM

    Is that flat screen a plasma?

  23. Posted by Laxbro | January 11, 2013 at 11:02 AM

    I'll gladly hold hands with cute "hipster" and "bohemian" chicks but I won't even talk to an authentic tatted up hipster chick that smells like hockey practice.

  24. Posted by 500 Hammers | January 11, 2013 at 11:07 AM

    Why is Dylan Ratigan humping my ear?

  25. Posted by ex-Nebraskan | January 11, 2013 at 11:09 AM

    I would pay $100 right now for a Valentino's Pizza. Runza gets all the national press, but those of us who left decades ago head straight to Valentino's when we're back for a football game.

  26. Posted by New Jersey | January 11, 2013 at 11:14 AM

    Slow clap. The last line was brilliant.

  27. Posted by Guest | January 11, 2013 at 11:18 AM

    Wow, gritty insight into the lives of the muppets. I felt dirty and depressed inside reading this. Congratulations sir.

  28. Posted by Tenaska | January 11, 2013 at 11:20 AM

    Please contact our receptionist to get the number for our "broker line". Thank you.

  29. Posted by Guest | January 11, 2013 at 11:21 AM

    Yo skee daddy, why don't you reduce the number of bumps you do before lunch, alright?

  30. Posted by What I do | January 11, 2013 at 11:29 AM

    I usually do the 3 for $225 at BB

  31. Posted by guest | January 11, 2013 at 11:37 AM

    laxbro I appreciate your joie de vivre. who doesn't enjoy a spoiled nyu poser that sleeps until noon and listens to animal collective

  32. Posted by Hobbes | January 11, 2013 at 11:53 AM

    Just in case you hadn't noticed, the comment system isn't like playing golf.

  33. Posted by segoviacobain | January 11, 2013 at 12:03 PM

    Too much ketamine, Jimbo.

  34. Posted by segoviacobain | January 11, 2013 at 12:07 PM

    I'm not sure if they are asking people to read Shakepesare's 'The Turtle and The Phoenix" in college anymore, laxbro, but there's some language in there regarding the sweet aroma of one's favorite lass in the throes of passion that is worth reviewing prior to your next pitch.

  35. Posted by UBS Safe Drugs Guy | January 11, 2013 at 12:49 PM

    Or alternatively increase them 50-fold and start mixing in some oxy contin and vodka.

  36. Posted by NakedShort | January 11, 2013 at 1:08 PM

    Dont worry HerbaLife. Ive got your back!

    -Loeb
    http://www.youtube.com/watch?v=Hi5MpNE5Jak

  37. Posted by Joe Sixpack | January 11, 2013 at 1:54 PM

    Maybe its time to talk to Chuck, he has ideas about glass and aluminum futures………

  38. Posted by Guest | January 11, 2013 at 4:15 PM

    Stop! … glaah! … choking me!

    — Bart

  39. Posted by Guest | January 11, 2013 at 4:15 PM

    Retail.

  40. Posted by sohbet | May 12, 2013 at 6:23 PM

    telling these little stories, here's a good idea: Have a point. It makes it so much more interesting for the listener.

  41. Posted by sohbet | July 8, 2013 at 9:22 PM

    officers to investigate Blackstone's fishy financial transactions, but they wound up giving them