Opening Bell: 12.05.13

Grant Hill’s Wall Street Whirlpool Chats Pave Way to John Mack (Bloomberg)
Grant Hill spent much of his tenure with the Orlando Magic in the trainer’s room, where to the chagrin of him and teammate Pat Garrity, control of the television remote was governed by majority rule. “Most of the guys wanted to watch SportsCenter or the Cartoon Network,” said Garrity, a former players’ union treasurer who earned a Master of Business Administration from the Fuqua School of Business at Duke University, Hill’s alma mater, after retiring from the National Basketball Association in 2008. “Everyone would leave the room and then we could switch to CNBC.” Hill, whose 18-year injury-saddled career ended after last season, had an insatiable appetite for learning, particularly about finance, Garrity said in a telephone interview. Their whirlpool chit-chat often focused on hedge funds and private equity.

Volcker Rule Won’t Allow Banks to Use ‘Portfolio Hedging’ (WSJ)
In a defeat for Wall Street, the “Volcker rule” won’t allow banks to enter trades designed to protect against losses held in a broad portfolio of assets, according to people familiar with the rule. The practice, known as portfolio hedging, has become a focal point of regulators drafting the rule, a controversial plank of the 2010 Dodd-Frank financial law that seeks to prevent banks from putting their own capital at risk in pursuit of trading profits. The rule, named after former Federal Reserve Chairman Paul Volcker, is expected to be approved next week, ending a three-year period of regulatory uncertainty for some of the securities industry’s most-profitable businesses. But it won’t contain language permitting portfolio hedging, which has been “expunged” from earlier drafts of the rule, according to a person familiar with the matter. Regulators decided to remove portfolio hedging from the rule after J.P. Morgan Chase disclosed billions of dollars in losses from its so-called London whale trades in 2012.

Lew Says Reforms Making Financial System Safer (WSJ)
Mr. Lew, in prepared remarks for a speech Thursday morning at the Pew Charitable Trusts, said while efforts to implement the 2010 Dodd-Frank law have “taken longer than we hoped” the rules are largely falling into place and helping to bolster the financial system. He said more needs to be done, including ensuring that U.S. regulators have resources to enforce the rules and the adoption of robust protections by global counterparts to fortify the international financial system.

Memory Fails Top Witness In SAC Case (NYP)
Confessed inside trader Jon Horvath couldn’t remember which of his recommendations at hedge fund SAC Capital Advisors were based on illegal information — and which were not. In fact, some of Horvath’s best calls came “the old fashioned way” — by doing “legitimate, proper research analyst work,” defense lawyer Barry Berke told jurors Wednesday, as he continued to hammer away at Horvath in a second day of brutal cross-examination…The crux of Horvath’s testimony is that his illegal stock tips from another hedge fund analyst, Jesse Tortora, were fed to Steinberg, who knew they weren’t kosher. But on Wednesday, even Horvath didn’t seem to recall when Tortora’s information crossed the line into criminality. Berke honed in on information Horvath got from Tortora toward the end of 2007. “Do you believe you were getting illegal inside information in December of 2007?” Berke asked, rephrasing the question and repeating it at least a half-dozen times — eliciting different responses each time. “I don’t know exactly when it started,” Horvath said once. “I don’t remember how I viewed it at the time,” he said another.

Landmark Custody Battle Over Dog In Divorce (NYP)
A pair of divorcing women are about to fight it out in court over a miniature dachshund named Joey in what will be New York’s first matrimonial pet-custody case. “People who love their dogs almost always love them forever,” Manhattan Justice Matthew Cooper opines in his ruling granting the women oral arguments. “But with divorce rates at record highs, the same cannot always be said for those who marry.” That’s the case with Washington Heights residents Shannon Louise Travis, 32, and her soon-to-be ex-wife Trisha Bridget Murray. The only bone of contention in their divorce is who will get sole custody of their 2-year-old pet. Travis bought Joey as a 10-week-old puppy from a pet store and gave him to her then-girlfriend as a gift and “a consolation for her having to give away her cat at Travis’ insistence,” according to court papers. Murray is fighting to keep her best friend, who always slept on her side of the bed. “I consider this puppy, my little angel Joey, the love of my life,” Murray told The Post. “He is my little soul mate, and there was no way in this lifetime I could ever live without him.” Judge Cooper says it’s surprising that, in a “canine-centric city where dogs play an ever more important role in our emotional lives,” he is in uncharted territory. He notes that New York law lags behind other states’ legal standing of their pets, and that “most pet owners would not trade their pets for even $1 million in cash.” Instead of regarding Joey like a piece of property, the judge — who gives the full disclosure that he owns a 12-year-old rescued pit bull mix named Peaches — will schedule a hearing to determine his fate.

Deutsche Bank To Quit Commodities Trading (Reuters)
Deutsche Bank said on Thursday it is exiting the majority of its global commodity business due to rising regulatory pressures, becoming the latest bank to sell or scale back its operations in the once lucrative sector. Deutsche Bank will exit energy, agriculture, base metals and dry bulk trading, it said on its website, retaining only precious metals and a limited number of financial derivatives traders.

Economy in U.S. Grows at 3.6% Rate on Bigger Inventories (Bloomberg)
The U.S. economy expanded in the third quarter at a faster pace than initially reported, led by the biggest increase in inventories since early 1998. Consumer spending slowed. Gross domestic product climbed at a 3.6 percent annualized rate, up from an initial estimate of 2.8 percent and the strongest since the first quarter of 2012, Commerce department figures showed today in Washington. The median forecast of 77 economists surveyed by Bloomberg predicted a 3.1 percent gain.

ECB Stands Pat On Interest Rates (WSJ)
The central bank left its key interest rate, the one that it charges commercial banks for its regular loans, at a record low of 0.25%. It also left the rate it pays on overnight deposits at zero for a 17th straight month, refraining from a decision to charge banks for briefly parking funds at the central bank.

Texas deli owner fed up with lazy staff closes doors to teach employees lesson (NYDN)
John Herod, who runs a Schlotzsky’s Deli and Cinnabon in Abilene, said his workers never smiled at each other or customers and always performed tasks way too slowly. So he suspended business and put up a “CLOSED FOR ATTITUDE ADJUSTMENT” sign outside. After firing some of the worst employees, he is now “re-educating” the others on how to interact with clients and better prepare food. The marquee initially suggested he would reopen Dec. 4. but ABC 13 reports that’s now been pushed back to Dec. 9.

Comments (28)

  1. Posted by Bored Guest | December 5, 2013 at 11:35 AM

    11:31 AM timestamp? It's a festivus miracle!

  2. Posted by guest | December 5, 2013 at 11:37 AM

    God damn it Shazar, every time I think I'm done with you, you go and do something like post a picture of that adorable puppy and you pull me back in!

  3. Posted by guest | December 5, 2013 at 11:42 AM

    Grant Hill's teammates are not alone in thinking CNBC sucks.

  4. Posted by guest | December 5, 2013 at 11:43 AM

    This whole dog case is actually sending shivers down my spine re: the thought of getting divorced and having to fight my wife for my dog in court.

    - guy whose dog is treated better than most children

  5. Posted by Dennis Kneale | December 5, 2013 at 11:49 AM

    Deserves way more upvotes.

  6. Posted by Guest | December 5, 2013 at 11:51 AM

    Shouldn't these broads be figthing over cats instead of dogs?

  7. Posted by Guest | December 5, 2013 at 11:54 AM

    So if banks can specify a particular risk that a trade offsets, they can be allowed to do it? Also, if the hedging position is no longer needed, are they required to liquidate it?

  8. Posted by Guesto Joe | December 5, 2013 at 11:56 AM

    I was just going to say….they arent using Hawaiian Time Zone stamps today…..

  9. Posted by Alices Restaurant | December 5, 2013 at 11:56 AM

    The only reason I'm writing you this comment now is cause you may know somebody in a similar
    situation, or you may be in a similar situation, and if your in a situation like that there's only one thing you can do and that's walk into your local Minettas wherever you are, just walk in say "Bartender, can fire Shazar and hire Brocaine_Brandy?". And walk out.

    You know, if one person, just one person does it they may think he's really sick and they won't serve him. And if two people, two people do it, in harmony, they may think they're both faggots and they won't serve either of them. And three people do it, three, can you imagine, three people walking in ravin' about that UBS reject Shazar and walking out! They may think it's an organization. And can you, can you imagine fifty people a day, I said fifty people a day walking in to Minettas yelling about Shazar and walking out! Friends they may think it's a movement.

  10. Posted by Lukewarm gag | December 5, 2013 at 11:56 AM

    Ever since his anal bleaching accident has prevented him from getting a full nights rest he has been coming into work earlier to get his work done on time.

  11. Posted by Andrew | December 5, 2013 at 11:57 AM

    As an equitable split, the judge determined Travis would keep the dog, but Murray would keep all the peanut butter

  12. Posted by Rakesh | December 5, 2013 at 12:03 PM

    Please file a technical support ticket. Thanks!

  13. Posted by Guest | December 5, 2013 at 12:09 PM

    I have slayed nui hohono puka in Hawaii.

  14. Posted by UBS Regulatory Arb | December 5, 2013 at 12:14 PM

    Exactly. So the risk is we're going to lose a metric ass ton of money and blow ourselves up. To hedge against this risk we're going to put on a ton of synthetic exposure to a bunch of different risks and hope it works out. Also, buying tons of bitcoins.

  15. Posted by Biblical D. Kneale | December 5, 2013 at 12:15 PM

    Solomon is such a cruel judge.

  16. Posted by Duchess | December 5, 2013 at 12:16 PM

    The only bone in their marriage was one of contention.

  17. Posted by Bloke | December 5, 2013 at 12:29 PM

    I had to think about that longer than I should have.

    – Guy who obviously needs more coffee

  18. Posted by Gast | December 5, 2013 at 12:40 PM

    Longer and harder?

    - Cunning linguist

  19. Posted by Guest | December 5, 2013 at 1:21 PM

    Called my exGF that about 6 years ago. She responded, "Why are you calling me a cuntalingist?"

    - Guy that loves California Blondes

  20. Posted by Bored Guest | December 5, 2013 at 1:50 PM

    Perhaps the bone of contention was, in fact, a bone. Sounds like Murray was hoggin' it every night.

  21. Posted by Parents Basement | December 5, 2013 at 1:54 PM

    SHORTAGE OF CRISIS ACTORS.

  22. Posted by steel reserve 40oz. | December 5, 2013 at 1:54 PM

    sounds like there's appetite for a bitcoin futures market.

    -B. Madoff

  23. Posted by Chungson | December 5, 2013 at 1:58 PM

    The Hoax is ObamaCare not the Knockout Game

  24. Posted by St. Copious | December 5, 2013 at 2:17 PM

    I think Grant Hill is going to make a small fortune in private equity and other alternative investments. Of course, he will start with a large fortune.

  25. Posted by -Guest | December 5, 2013 at 2:18 PM

    "granting the women oral arguments"

    Bet they gave each other a tongue lashing…then they argued.

  26. Posted by Guest | December 5, 2013 at 4:42 PM

    Please elaborate on what a metric ass ton is please.

    - MF Global Risk Management

  27. Posted by el guesto | December 5, 2013 at 5:46 PM

    blah blah blah [predictable pussy joke] blah blah blah

  28. Posted by grain or not | December 10, 2013 at 10:53 PM

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