Opening Bell: 10.24.13

Credit Suisse revamps rate trading after income slide (Reuters)
Credit Suisse said it would restructure its interest rate trading activities following a third-quarter slide in revenue at its investment bank. The Swiss bank said overall net profit rose on the year to 454 million Swiss francs ($509.1 million) from the year-ago period, where charges linked to its own debt ate into profits. The profit missed by far analyst estimates, which averaged 705 million francs. “Credit Suisse is restructuring and simplifying its rates business in order to increase returns,” in a bid to lower risky assets and leverage, the Swiss bank said in a statement on Thursday.

Icahn Pushes Apple For $150 Billion Buyback (WSJ)
Activist investor Carl Icahn has boosted his investment in Apple by about 22% to 4.73 million shares, and continued to push for a massive $150 billion buyback at the company, according to a letter he sent to Apple Chief Executive Tim Cook. The billionaire investor suggests the company use a self-tender offer to buy back the stock, and pledges that he himself wouldn’t sell the stock and take profits. “There is nothing short term about my intentions here,” he said.

Fed Proposes Stricter Liquidity Rules for Largest U.S. Banks (WSJ)
The proposal outlined by Fed officials goes beyond international agreements, requiring the largest banks to hold enough safe assets—such as cash or those easily convertible to cash—to fund their operations for 30 days if other sources of funding aren’t available. The rules are intended to prevent a repeat of the 2008 financial crisis, when financial markets froze due to a lack of liquidity. The proposal would ensure banks had access to cash and other assets in times of market dislocation.

Hamptons Sales Surge Fuels High-End Home Tear-Downs (Bloomberg)
Hamptons real estate deals are surging, fueling a boom in knockdowns, expansions and quick resales in the beachfront towns favored by Wall Street financiers and celebrities. Home purchases in the three months through September jumped 32 percent from a year earlier to 534, the most for a third quarter since 2005, appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate said in a report today. “Because of the scarcity of land in the Hamptons on which you can build there today, the land is worth more than the house,” said Mitchell Pally, chief executive officer of the Long Island Builders Institute, a regional trade group. “In most places, the bigger the house, the harder it is to sell. In the Hamptons the bigger the house, the easier it is to sell.”

Hedge fund mogul in nasty divorce battle with ex (NYP)
James Dondero, co-founder and president of the $18 billion asset manager Highland Capital Management, claimed in court that despite allegedly earning more than $36 million in 2010, several pending lawsuits against the firm have rendered him insolvent under the court’s accounting rules. The bitter, two-year divorce battle — which has seen his one-time partner testify for the 33-year-old wife, Rebecca Dondero — went to trial Wednesday. The battle has captured the attention of hedge-fund titans from coast to coast, not only because Dondero refused to settle short of a trial and risk embarrassing testimony in court — but because a casual conversation between him and Patrick Daugherty, the former partner, resulted in Dondero getting slammed at a hearing last year. Daugherty testified for the wife that Dondero told him he planned to try and hide assets just to stiff Rebecca on the pre-nup. Daugherty also claims in court papers that Dondero asked him to lie at an earlier hearing and tell the court Dondero was not hiding assets. “Dondero [attempted] to help Daugherty remember how he should testify regarding his wife, suggesting that it was Daugherty’s idea that he pay his wife nothing and that Daugherty referred to Dondero’s wife as a whore,” court papers claim. Daugherty hung up on Dondero when he made the request, court papers claim.

Lehman sues Giants Stadium over swap contracts gone sour (NYP)
The case goes back to 2008, when Lehman’s historic collapse served as a key catalyst to the global financial crisis…The lawsuit came about as Lehman and Giants Stadium could not agree on the settlement amount of two swap contracts after the investment bank filed for bankruptcy. The swap contracts, mostly underwritten by Lehman Brothers, were intended to hedge interest rate risks on about $650 million in bonds issued by the Giants entity. When the swaps were terminated in September 2008, at a time Lehman filed for bankruptcy, Giants Stadium “undertook a contorted plan” to avoid paying millions of dollars, the investment bank said in a lawsuit on Wednesday. Giants Stadium estimated that Lehman owed it about $301 million after the termination of the swaps contracts, a figure disputed by Lehman, the filing said. Later, Boston-based Baupost Group LLC, one of the world’s biggest hedge funds, bought the Giants Stadium claims against the Lehman estate and in turn sought to amend its claims to about $585 million for each contract, the lawsuit said. Lehman said the swaps were about $60 million in its favor just days before it filed for Chapter 11. On Wednesday, Lehman sought damages of no less than $94 million plus interest, after what is says was the “proper calculation” of the settlement amount of the swaps.

UBS Probed Over Disclosure of Restructuring, Settlement (WSJ)
UBS AG is being investigated over whether it breached disclosure rules last year when it announced a major restructuring and a 1.4 billion Swiss franc ($1.57 billion) settlement with regulators over interest-rate fixing, Switzerland’s principal stock exchange said Thursday. The regulatory arm of the SIX Swiss Exchange said in a statement it had already conducted a preliminary investigation into whether Zurich-based UBS had met its obligations in disclosing the two decisions, which were made last year. The exchange deemed a continued probe was necessary.

Bonds Erase ’13 Losses as Three-Decade Rally Defies Bears (Bloomberg)
Borrowing costs for corporate, sovereign and securitized debt have fallen to 1.94 percent, within 0.5 percentage point of historic lows, five months after Pacific Investment Management Co.’s Bill Gross said that the rally had probably ended. BlackRock Inc. Chief Executive Officer Laurence D. Fink said a scaling back of quantitative easing could come as late as next June.

Lake Brantley High School teacher suspended for taping girl up (CO)
Greg Sims, a science teacher at Lake Brantley High School in Altamonte Springs, was suspended for five days without pay, according to a letter addressed October 8 from Superintendent Walt Griffin. His suspension runs through early November. According to the letter, Sims “taped a student’s hands together, attempted to tape her mouth closed as a means of addressing her disturbing class and taped her book bag to a pole in the classroom.” “I have determined that your conduct in this situation does not conform to the Seminole County Public Schools Student Conduct and Discipline Code,” Griffin wrote. “This is unacceptable conduct on the part of a professional educator and represents misconduct in office.”

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Comments (37)

  1. Posted by Guest | October 24, 2013 at 11:09 AM

    Go blue!
    -sad guest

  2. Posted by Guesteban | October 24, 2013 at 11:10 AM

    Griffin's letter continued: "Accordingly, we think it best if you duct out of school for five days to deal with the deeper issues you are likely masking."

  3. Posted by Guest | October 24, 2013 at 11:19 AM

    "… We suggest that you adhere to school policy and not fight the tape, lest you find yourself in a double-sided, sticky situation with the school board and parents yet again."

  4. Posted by Disgruntled Loser | October 24, 2013 at 11:24 AM

    You know, if Shaz is so lazy that he can't get the fucking "Opening Bell" out before the fucking opening bell, then I can't be expected to offer a pithy comment.

  5. Posted by SUNY | October 24, 2013 at 11:28 AM

    Fucktastic Shazar is to busy commenting on Jap bukkake videos on xhamster. Dudes need a intervention.

  6. Posted by guest | October 24, 2013 at 11:31 AM
  7. Posted by Pith Commentsworth | October 24, 2013 at 11:33 AM

    Shivering Jemmy

  8. Posted by Matt Levine | October 24, 2013 at 11:35 AM

    I wanna be a Marine Biologist.

  9. Posted by Guest | October 24, 2013 at 11:40 AM

    Mr. Sims, if you're okay with handling interns, I believe we have a position that may be of interest to you.

    -J. Gundlach

  10. Posted by TwitterIsTheFuture | October 24, 2013 at 11:51 AM

    I'm so glad #PIMCO which has the fiduciary responsibility to manage over $2 Trillion can find the time to start a twitter feud.

  11. Posted by Northwestern Mutual | October 24, 2013 at 11:57 AM

    Buy stock in AOL

  12. Posted by Shazaol | October 24, 2013 at 12:00 PM

    Sign up for American Online and get 10 free hours on DB!

  13. Posted by el guesto | October 24, 2013 at 12:02 PM

    Oh. Shit.

  14. Posted by Not the IRS | October 24, 2013 at 12:02 PM

    Did this Levine kid win the lottery or something? I mean, never writes, retired from GS after only a couple of years, somehow paid for 3 degrees…

  15. Posted by SEC | October 24, 2013 at 12:06 PM

    Lay off.

  16. Posted by That's Why! | October 24, 2013 at 12:08 PM

    Biggest dick in porn.

  17. Posted by Keith McCullough | October 24, 2013 at 12:08 PM

    Hey, I manage to do it to and many have called me the Bill Gross of equities.

  18. Posted by Guest | October 24, 2013 at 12:12 PM

    I wish I could turn my 2 week vacation into a 3 week vacation and still counting!

  19. Posted by Guest | October 24, 2013 at 12:13 PM

    My balls are so full they are about to explode. Any ideas?

  20. Posted by investorcluzo | October 24, 2013 at 12:17 PM

    $150 billion buyback….why didn't I think of that? Oh wait.
    -D. Einhorn

  21. Posted by ThatsVVacc | October 24, 2013 at 12:18 PM

    Don't forgot his charity with the mentally disabled. I think it is great that he was able to find employment for Shazar.

  22. Posted by guest | October 24, 2013 at 12:36 PM

    14 longs, 10 shorts? $29.99 per month?

  23. Posted by Keith McCullough | October 24, 2013 at 12:43 PM

    Should've got a twitter account

  24. Posted by SEC MD | October 24, 2013 at 12:48 PM

    We've found that the best way to combat similar addictions is complete immersion for an extended period of time; the rationale is that eventually you'll get sick of it. We're on year 5, I'm predicting a breakthrough any day now!

  25. Posted by Guest | October 24, 2013 at 12:58 PM

    Rumour has it that Matt's been hired by the Economist. So you will never see his name on a byline again, but expect a lot more footnotes in the Finance and Economics section. They wanted Bess, but she hates the English.

  26. Posted by Wooty Booty | October 24, 2013 at 1:06 PM

    Bess doesnt want those crusty old men looking at her wooty all day er day.

  27. Posted by Guest | October 24, 2013 at 1:09 PM

    Guest post, since DB is probably not posting anything again today.

    According to DB:
    "Today at Finalternatives:
    "Per Jon Shazar at DB:
    " " " "

  28. Posted by WantToBeLikeMatt | October 24, 2013 at 1:21 PM

    What I heard was that SAC had some time to reflect on its decision regarding the London office and decided to appoint Matt to be their sole PM/Trader/Analyst/Footnoter/Chart Maker in the UK, he's going to write for the Economist in his spare time.

  29. Posted by Doktor Art Laugher | October 24, 2013 at 1:23 PM

    Writer for the Economist = decent pay / no readers

    Writer for DB = no pay (unless you're Bess) / big readership

  30. Posted by Im_a_Dude | October 24, 2013 at 1:38 PM

    you got me excited for second, I thought FKApmco had started a blog. She hasn't posted here in ages.

  31. Posted by Guest | October 24, 2013 at 1:43 PM

    Well, the Economist has a circulation of 1M+, and no one buys it for the centrefold so probably not. That said plenty of people just tote it around to look cosmopolitan and well-informed.

  32. Posted by Guest | October 24, 2013 at 1:46 PM

    Word is he is going to write for Page 3 @ The Sun.

  33. Posted by Guest | October 24, 2013 at 1:52 PM

    Just stay at home and enjoy some scotch

  34. Posted by Lazard | October 24, 2013 at 2:01 PM

    So I guess turning the men's room at the Gansevoort into a Jackson Pollock is a thing now?

  35. Posted by Guy from Deleware | October 24, 2013 at 3:54 PM

    Can we please get a revamp of all the rips on Greg? That always made my day.

  36. Posted by Guest | October 25, 2013 at 7:21 AM

    I can show you 1M+ people that carry a magazine around to show how smart and well informed they are.

  37. Posted by Guest | October 25, 2013 at 7:22 AM

    Murmurs out of Chicago that they have a new writer at Playboy.