Opening Bell: 03.11.13

EU Chiefs Seeking to Stave Off Euro Crisis Turn to Cyprus (Bloomberg)
European leaders grappling with political deadlock in Italy and spiraling unemployment in France will turn to a financial rescue for Cyprus in an effort to stave off a return of market turmoil over the debt crisis. European Union leaders will meet for a March 14-15 summit in Brussels to discuss terms for Cyprus, including the island nation’s debt sustainability and possibly imposing losses on depositors. That comes as Italy struggles to form a government after an inconclusive Feb. 24-25 election and as concern over the French economy mounts with unemployment at a 13-year high.

Spain’s Bailout Fund Said to Seek Help on Bank Strategy (WSJ)
Spain’s bank bailout fund is seeking to hire advisers to help shape a long-term strategy for dealing with its portfolio of nationalized lenders, a week after calling off an auction of one of the most troubled banks. People briefed about the plan said the fund, known by its Spanish acronym FROB, will make contact with strategic consultants, and possibly with investment banks, once the plan has been approved by the FROB’s board of directors.

Is There Life After Work? By Erin Callan (NYT)
“I didn’t start out with the goal of devoting all of myself to my job. It crept in over time. Each year that went by, slight modifications became the new normal. First I spent a half-hour on Sunday organizing my e-mail, to-do list and calendar to make Monday morning easier. Then I was working a few hours on Sunday, then all day. My boundaries slipped away until work was all that was left…I have often wondered whether I would have been asked to be C.F.O. if I had not worked the way that I did. Until recently, I thought my singular focus on my career was the most powerful ingredient in my success. But I am beginning to realize that I sold myself short. I was talented, intelligent and energetic. It didn’t have to be so extreme. Besides, there were diminishing returns to that kind of labor. I didn’t have to be on my BlackBerry from my first moment in the morning to my last moment at night. I didn’t have to eat the majority of my meals at my desk. I didn’t have to fly overnight to a meeting in Europe on my birthday. I now believe that I could have made it to a similar place with at least some better version of a personal life. Not without sacrifice — I don’t think I could have “had it all” — but with somewhat more harmony. I have also wondered where I would be today if Lehman Brothers hadn’t collapsed. In 2007, I did start to have my doubts about the way I was living my life. Or not really living it. But I felt locked in to my career. I had just been asked to be C.F.O. I had a responsibility. Without the crisis, I may never have been strong enough to step away. Perhaps I needed what felt at the time like some of the worst experiences in my life to come to a place where I could be grateful for the life I had. I had to learn to begin to appreciate what was left. At the end of the day, that is the best guidance I can give. Whatever valuable advice I have about managing a career, I am only now learning how to manage a life.”

Paper Trail Goes Cold in Case Against S&P (Reuters)
In early 2007, as signs of distress began appearing in securities backed by residential mortgages, executives at Standard & Poor’s began advising analysts responsible for rating mortgage bonds that they should put the phrase “privileged and confidential” on emails to one another. Analysts working for the McGraw Hill Cos division also were discouraged from doodling on notepads and official documents during meetings to discuss pending deals and existing ratings, several former S&P employees said. That was not the first time S&P had tried to caution employees about paper trails. In 2005, a full two years before the housing market began to melt down, several top S&P managers attended an off-site meeting at hotel in Old Saybrook, Connecticut, to discuss ways to increase the fees it collected from Wall Street banks for rating mortgage bonds. A former S&P executive said that after the meeting, employees were instructed to discard any notes they had taken from the meeting.

InTrade Shuts Down (WSJ)
InTrade, the Ireland-based website that allows users to place wagers on non-sports-related upcoming events, announced on Sunday that it is shutting its site down. In an official statement, the company does not go into great detail as to why it is closing its doors, only that it is related to “financial irregularities which, in accordance with Irish law,” require InTrade to cease operations until resolved. “At this time and until further notice, it is not possible to make any payments to members in accordance with their settled account balance until the investigations have concluded,” the company said.

Commodities Squeeze Banks (WSJ)
The sharp fall in commodity revenue has already claimed some victims. UBS AG, the Swiss bank that has been under pressure to cut costs and improve its performance, last year closed all its commodities-trading desks aside from those dealing in precious metals. Goldman, UBS, Deutsche Bank, and Barclays have all suffered departures of senior commodity traders to hedge funds and independent trading companies over the last several months. Average staffing in commodities trading declined 5.9% last year at major banks, according to Coalition.

Artist Teaches George W. Bush How To Paint (Fox5)
An artist in Cumming, GA spent a month teaching former President George W. Bush how to paint. Bonnie Flood said that President Bush has a passion for painting and shows real potential as an artists. “He started off painting dogs. I think he said he painted 50 dogs,” Flood said. “He pulled out this canvas and started painting dogs and I thought, ‘Oh my God, I don’t paint dogs!” Flood, who does most of paintings at her home in Cumming, occasionally conducts workshops in Florida. That’s where the former President heard about her. The next thing she knew, she was packing up her paints to spend a month in Boca Grande with President Bush. She said that she spent about six hours a day with the President, mixing paints and teaching him proper brush strokes. She says she wasn’t intimidated but admits she really didn’t know what to call him until she found the magic number. “I called him ’43′ because that’s the way he signed his paintings. “When I really wanted him to do something, I would say, ‘Mr. President you know that you don’t do it that way.’” She says the President learned quickly and soon started painting fewer dogs and more landscapes. “He has such a passion for painting, it’s amazing,” Flood said. “He’s going to go down in the history books as a great artist.”

Hostess Creditor, Private-Equity Firms Show Interest in Twinkies Brand (Reuters)
Hostess Brands creditor Silver Point Capital and hedge fund Hurst Capital have expressed interest in buying Hostess’s snack cake brands, including Twinkies, the New York Post reported.

Paulson Said to Explore Puerto Rico as Home With Low Tax (Bloomberg)
John Paulson, a lifelong New Yorker, is exploring a move to Puerto Rico, where a new law would eliminate taxes on gains from the $9.5 billion he has invested in his own hedge funds, according to four people who have spoken to him about a possible relocation.

More US Profits Parked Abroad (WSJ)
A Wall Street Journal analysis of 60 big U.S. companies found that, together, they parked a total of $166 billion offshore last year. That shielded more than 40% of their annual profits from U.S. taxes, though it left the money off-limits for paying dividends, buying back shares or making investments in the U.S. The 60 companies were chosen for the analysis because each of them had held at least $5 billion offshore in 2011.

Twitter, Social Media Are Fertile Ground For Stock Hoaxes (Reuters)
“Twitter pump and dump schemes are obviously something for the market to be concerned about, even if they are just a new way for people to do schemes that have been done forever,” said Keith McCullough, chief executive officer at Hedgeye Risk Management in New Haven, Connecticut. He uses Twitter and has more than 22,000 followers. In such hoaxes, anonymous users set up accounts with names that sound like prominent market players, issue negative commentary, and spark massive declines. The selling that follows shows how the rapid spread of information on social media can make for volatile trading, and is a warning to investors who trade on news before fully verifying the source.

SEC: Goldman Cannot Ignore Proposal to Split Chairman, CEO Roles (Reuters)
SEC staff sent a letter to Goldman internal counsel Beverly O’Toole this week, saying the agency is “unable to concur” with Goldman’s view that the shareholder proposal does not warrant a vote.

El Paso Sheriff’s deputies arrest 2 ice cream men for possession of pot (EPT)
Saturday afternoon, Sheriff’s deputies spotted a purple ice cream truck with a cracked windshield and an expired registration sticker along the 8600 block of Alameda. During the traffic stop, one of the occupants left the vehicle and led deputies on a brief foot pursuit before being caught. Two tupperware bowls containing a green leafy substance, believed to be marijuana, was found on the man, who was identified as 19-year-old Elijah Sanchez. The second occupant, identified as 29-year-old Anthony Arellano, was also charged with possession of marijuana after deputies found marijuana inside the vehicle. Arellano has been arrested in the past for numerous felony charges and a previous possession of marijuana charge in 2006, deputies said.

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Comments (38)

  1. Posted by Wilbur | March 11, 2013 at 9:22 AM

    wtf, no respect for my fallen cousins in Shanghai either?

  2. Posted by Guest | March 11, 2013 at 9:35 AM

    Having an infant at age 47 will bring back fond memories of all the free time at Lehman Brothers.

  3. Posted by Trader Baby | March 11, 2013 at 9:43 AM

    Big loss on Friday baby, clean P&L for the week baby, what to wear to work baby, Zegna suit baby, slim fit looking good baby, like that sheen baby, silk wool blend baby, finish the look with Gucci loafers baby, got two pair wear the brown ones with jeans baby, pound a Red Bull on the way to work baby, pound another on the elevator baby, flash the badge to enter the trading floor baby, all eyes on me baby, half the world sleeping but I’m up hustling baby, who’s gunna make money on wheat futures today baby, quoted in the WSJ baby, future of the firm baby, electronic trading can’t replace me baby, I’m a protégé baby

  4. Posted by PippyLongSausage | March 11, 2013 at 9:46 AM

    That's better than 99% of the rap songs I've heard since 2007. Keep flowin'

  5. Posted by Louis W. III | March 11, 2013 at 9:48 AM

    Wheat?? Everyone knows FCOJ is where it's at.

  6. Posted by Happy Gilmore | March 11, 2013 at 9:49 AM

    Hey 43, I've seen those finger paintings that you bring home, and they suck!

  7. Posted by Nice Weather | March 11, 2013 at 9:51 AM

    The Transfer Pricing Conference at USD was tits. Man I had a good time. You guys missed it.

  8. Posted by guest | March 11, 2013 at 9:54 AM

    "At the end of the day, that is the best guidance I can give." – E. Callan

    I would have thought the best guidance would be not to leverage billions of dollars of shareholder money 30:1 on POS securities, collect millions in compensation and deny you played any part in the mess.

    -Trader who wouldn't listen to Callan if she told him to jump out of a burning building into a lake

  9. Posted by el invitado | March 11, 2013 at 10:06 AM

    I hate you

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

    To the investment bankers and private equity investors who read this: if you all do not get the financing lined up to put Ding Dongs and Fruit Pies back on store shelves within six months, I will consider the lot of you to be miserable failures and a blight on society.

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

    Working title: "Implode, Eat, Pray, Love."

    - E.Callan

  12. Posted by Guest | March 11, 2013 at 10:16 AM

    Hey, that is the name of my book!

    -Dylan Ratigan

  13. Posted by Guest | March 11, 2013 at 10:19 AM

    – Michael Moore

  14. Posted by Guest | March 11, 2013 at 10:19 AM

    "I was talented, intelligent and energetic."

    Not enough, apparently.

    Also, some free advice: once you are at the executive level, nobody cares how hard you work or how committed to your job you are. Those are fine traits for an entry-level worker, to be sure. But when you're at the executive level, what they really care about is whether or not you make the right decisions. All the hard work in the world doesn't make a bit of difference if you can't look at a massive leverage ratio in an extremely volatile industry and say, "hmm, seems a bit high to me".

  15. Posted by JRandom | March 11, 2013 at 10:21 AM

    Mine is "Eat, Eat, Eat, Eat."

    – M. Bartiromo

  16. Posted by Guesti | March 11, 2013 at 10:22 AM

    " Since I resigned my position as chief financial officer of Lehman Brothers in 2008"

    I think she actually believes that she left on her own terms?

  17. Posted by Chris Christie | March 11, 2013 at 10:30 AM

    Wrong

  18. Posted by Guest | March 11, 2013 at 10:32 AM

    I sign all my paintings with a little bit of my dna.

    -Bubba

  19. Posted by Guest | March 11, 2013 at 10:34 AM

    Shoot! With Intrade shut down, how will I bet on the odds of Obama being re-elected in 2016?

    -UBS MD

  20. Posted by Cargill | March 11, 2013 at 10:36 AM

    agreed except that last one.

    shes doing that fireman remem.

  21. Posted by Jon Corzine | March 11, 2013 at 10:42 AM

    You can only pull that off at large commercial depository institutions turns out.

  22. Posted by Guest | March 11, 2013 at 10:42 AM

    Bloomberg author misspelled losses.

  23. Posted by TARP | March 11, 2013 at 10:42 AM

    you saying you want a piece of me ?

  24. Posted by Guestq12 | March 11, 2013 at 10:48 AM

    Extreme volatility makes the charts look like roller coasters!

  25. Posted by Bejujular | March 11, 2013 at 10:56 AM

    I don't know John, your capital losses could probably be sold for more in the states than you'd ever get from the capital gains differential.

  26. Posted by guest | March 11, 2013 at 11:02 AM

    There's an executive face only a short seller could love.

    -D. Einhorn

  27. Posted by Guest | March 11, 2013 at 11:08 AM

    At least that's my hair, Dave.

    -E. Callan

  28. Posted by TFM | March 11, 2013 at 11:43 AM

    "Gucci loafers"

    Total Rutgers Move.

  29. Posted by Guest | March 11, 2013 at 11:46 AM

    But when you're at the executive level, what they really care about is whether or not you make the right decisions kiss ass and/or swallow.

    Fixed.

  30. Posted by Wedding Crasher | March 11, 2013 at 11:50 AM

    The painting was a gift George, I'm taking it with me

  31. Posted by Shazared | March 11, 2013 at 1:13 PM

    "Your winnings*, Sir."

    * Fat Sandwich

  32. Posted by The Wire Quant | March 11, 2013 at 1:20 PM

    If you have a runner in your ice cream truck in case of police pursuit, maybe send all the contraband with him so you don't both get in trouble?

  33. Posted by D'Long | March 11, 2013 at 1:21 PM

    You sound like a fucking baby too.

  34. Posted by Guest | March 11, 2013 at 1:21 PM

    Down votes on a Gucci loafer blast? Guidos must be taking over DB.

  35. Posted by Abe_Froman_ | March 11, 2013 at 1:51 PM

    Good to hear Big Worm is still on the streets

  36. Posted by Sold | March 11, 2013 at 1:59 PM

    Pot and Ice Cream on the go…in the same truck? Two birds, one stone.

  37. Posted by guest | March 11, 2013 at 4:34 PM

    Former President Clinton had also expressed an interest in art lessons from an expert in Cumming, Georgia until realizing he had misread the brochure.

  38. Posted by Mag Gash | March 24, 2013 at 12:04 PM

    What an insightful post! Great read!