BofA Forgiven as Buffett Says ‘You Do the Best You Can’ (Bloomberg)
Warren Buffett, who invested $5 billion in Bank of America Corp., said he’s confident the lender will overcome an accounting mistake that forced the firm to suspend an increased payout to shareholders. “That error they made does not bother me,” Buffett said on May 3 at Berkshire’s annual meeting in Omaha, Nebraska. “You do the best you can.” Bank of America halted $4 billion of share repurchases and a boost to its common-stock dividend on April 28 after finding the mistake in a stress-test submission to the Federal Reserve. The Charlotte, North Carolina-based bank’s error, which had gone undetected since 2009, didn’t affect earnings. “It doesn’t change my feeling about Bank of America or its management,” said Buffett, 83.
Borrowing Cash to Buy Complex Assets Is In Vogue Again (WSJ)
Banks again are doling out money to hedge funds and other investors to finance purchases of complex debt securities, returning to a practice that helped fuel the debt boom ahead of the financial crisis. RBC Capital Markets, Société Générale and Wells Fargo & Co. are among the banks offering to let investors borrow money, also known as providing leverage, to buy collateralized loan obligations, say investors and bankers. CLOs are bonds typically backed by pools of low-rated corporate loans. Borrowing programs for such esoteric securities have been only selectively available in the years since the crisis. While banks have lent to a handful of investors, the practice picked up late last year when funding costs began to fall. Even now, the use of leverage is relatively nascent for these securities.
Fed’s Fisher Says Economy Strengthening as Payrolls Rise (Bloomberg)
“The private sector is beginning to hire,” said Fisher, a voting member of the central bank’s policy committee, said today on the Fox News program ’’Sunday Morning Futures.’’ “We’d like to see that continue and, in fact, increase.” Employers added 288,000 jobs in April, the biggest monthly gain in two years, the Labor Department reported May 2. At the same time, more than 800,000 people abandoned the labor force and the share of working-age Americans in a job or looking for one fell to a 36-year low.
Former Microsoft CEO Being Urged To Buy Clippers (NYP)
…former Microsoft CEO Steve Ballmer is being urged by associates to move from software to the hardcourt if the NBA is able to extricate the team from Sterling’s hands. Ballmer — now the No. 1 shareholder in Microsoft after founder Bill Gates sold shares — was spotted at a game last week during the barrage of media coverage about Sterling’s racist remarks to gal pal V. Stiviano, sparking suggestions he’s interested in forming a bid. It wouldn’t be out of the ordinary. Ballmer made a run at the Sacramento Kings last year and has long hoped to bring an NBA team back to Seattle (though reports suggest the NBA wouldn’t look favorably on a move).
Tax-Free Bonuses Disappoint as Middle East Bankers Plan Job Hunt (Bloomberg)
Banking and finance professionals in the Middle East plan to seek new jobs this year after bonuses failed to meet expectations, according to eFinancial Careers. Almost 60 percent of the region’s financial services employees plan to change position, with 45 percent saying they were disappointed with their bonus, eFinancial said in an e-mailed report. Bonuses rose for half of Middle East finance professionals, compared with 49 percent in the U.K., 47 percent in the U.S. and Hong Kong and 42 percent in Singapore.
Hedge fund manager buys most expensive house in U.S. (CNBC)
Barry Rosenstein, fund manager at Jana Partners, is set to pay $147 million for an 18-acre beachfront home in the Hamptons on New York’s Long Island…The previous record for a home sale was set just two weeks ago, when a house in Greenwich, Conn., sold for $120 million.
PayPal executive launches angry poorly-spelled late night Twitter rant against his colleagues after night in New Orleans (DM)
Rocky’s first victim was Christina Smedley, PayPal’s vice president of global communications. ‘Duck you Smedley you useless middle. manager,’ he tweeted. ‘Christina Smedley is a useless. Piece of s**t.’ He then incoherently called for the head of a previously unknown employee. ‘People who should be fire from paypal Don Christmas a pool a kick.’ The tech industry veteran then claimed he could make Foursquare a $50billion company. ‘I can turn foursquare into a $50 bill OK n company let’s chat,’ he tweeted…The outspoken executive then woke up in the morning and claimed to be thirsty. ‘Hydrate.’ He then quickly deleted the offending tweets and publicly apologized to PayPal president David Marcus and vice president of growth and global strategy Stan Chudnovsky. His mea culpa was followed by the following tweet. ‘Day one of my next adventure? I am so ducking tired.’ Rocky then claimed the messages were meant for a colleague and that he did not realize were tweets instead of direct messages – DMs are private. He also blamed his new Android phone, saying he did not know how to use it. ‘The twitter interface on android and gs5 is shockingly different from iPhone, said the first explanatory tweet. ‘Last night I was using a new phone that I bought because I wanted to test experiences on android. Those messages were meant for a colleague,’ said the second.
Buffett Says His Successor Will Want Partner Like Munger (Bloomberg)
Warren Buffett, chairman and chief executive officer of Berkshire Hathaway Inc. (BRK/A) for more than four decades, said his successor as CEO will probably develop a partner like Vice Chairman Charles Munger. “Berkshire is better off because the two of us have worked together,” Buffett, 83, said Saturday of Munger, 90, at their company’s annual meeting in Omaha, Nebraska. Such a joint effort will add to the new CEO’s achievements and the “fun they have,” Buffett said.
Portugal Says It Plans to Exit Bailout (WSJ)
Prime Minister Pedro Passos Coelho announced Sunday that his government had decided not to seek a precautionary credit line from the lenders—its European Union peers and the International Monetary Fund—and will rely solely on markets for financing after taking the final installment of a €78 billion ($108 billion) bailout package next month.
Norway picks Citi as custodian of wealth fund over JPMorgan: FT (Reuters)
Norway picked Citigroup over rival U.S. bank JPMorgan Chase & Co Inc as custodian of its sovereign oil wealth fund, the world’s biggest at $865 billion, the Financial Times reported on Sunday. Officials at the banks were not immediately available for comment. The award of a seven-year contract is set to be announced this week, the paper said.
Mermaid nuptials make a splash at Fort Lauderdale hotel (Sun Sentinel)
Starting April 1, the resort has been offering this special package, which includes a 10-minute underwater session with mermaids while guests watch through portholes in the nautical-themed Wreck Bar. There’s also a choreography lesson, a bride-and groom-photo shoot with optional mermaid tails, and a 90-minute reception at the bar with champagne toast and appetizers…The first couple to take the plunge: George and Lee Sprague, Fort Lauderdale snowbirds who renewed their vows to mark their 50th anniversary. “It was a little bit outrageous,” said the bride, Lee Sprague, 73. “George and I decided we had to push the envelope a little bit and do something different.” They learned of the underwater nuptials while watching the hotel’s Friday night mermaid show earlier this year and thought, “Why not?” she recalled, adding, “It was good for us to take on something out of our comfort zone.” When the day finally arrived, on March 30, the Spragues dressed in matching green bathing suits and white T-shirts. His read: “Will you remarry me?” Hers: “You betcha!” Before their family and friends, they had a ceremony in one of the hotel’s patios with a justice of the peace. Wedding vows can be performed on the beach or poolside. The bride and groom then swim up to the portholes during the wedding reception to surprise the guests at the Wreck Bar. Three mermaids and a show director assist and watch over couples.