Opening Bell: 06.03.14

Taste for Risk Fueled Career of Sports Bettor Billy Walters, Now in Trading Probe (WSJ)
Mr. Walters once was a pool player and illegal bookie in Kentucky. “I was a bookmaker without a license,” he said in the 2007 interview. Moving to Nevada in the early 1980s, but retaining his Southern drawl, he became part of the first serious computer-betting syndicate, which used algorithms to crunch sports data. Today, he presides over a network of analysts who provide him information about games, and of associates he calls “partners” to place bets, according to Mr. Walters and people familiar with his methods. Gamblers and bookmakers closely watch his patterns. “I worked in the books for 20 years, and I never met the man once,” said Micah Roberts, a former sports-book director in Nevada. “He was like a shadow. But when he makes his bet, you respect it so much that you move the line accordingly and kind of scrap everything you’ve booked already.” His information seems so good that sports leagues are concerned people close to teams tip him off about injuries or other matters that could affect games, said Mark Lipparelli, a former chairman of the Nevada Gaming Control Board. Getting inside information on sporting events isn’t illegal in Nevada, Mr. Lipparelli said.

News of alleged insider trading means investigators can’t use wiretaps (NYP)
The feds are unlikely to be able to conduct wiretaps as part of the insider trading probe into the activities of golfer Phil Mickelson and investor Carl Icahn now that news of the investigation has leaked, sources told The Wall Street Journal. Probers had been considering using electronic surveillance in their investigation, the Journal reported Sunday. But that plan evaporated once news of the case started to become public, according to WSJ sources. Wiretapping Icahn could have been an uphill battle, anyway, sources said. He’s part owner of a telecommunications firm that might have been used to conduct the surveillance.

Hedge-Fund World’s One-Man Cash Machine (WSJ)
In the Back Bay neighborhood of Boston, one man is building a moneymaking machine that rivals some of the hedge-fund industry’s biggest names. Calls to his office go unreturned even from those eager to fork over eight-figure sums, potential investors say. One industry veteran referred to him as “a unicorn,” as few people have ever seen him. The hedge-fund manager, David Abrams, has personally become a billionaire, and earned billions more for his wealthy investors, over the past five years running what is effectively a one-man shop, according to company and investor documents reviewed by The Wall Street Journal and people who have worked with him. His firm, Abrams Capital Management LP, manages nearly $8 billion across three funds and is discussing raising money for a fourth fund that could help push its assets past $10 billion…The firm employs three analysts and a small back-office staff, but Mr. Abrams approves all trades personally, according to people that have worked with him. Other firms of comparable assets can have hundreds of employees. He also built his fortune with the equivalent of one hand tied behind his back: His firm uses no leverage, or borrowed money, and often sits on billions in cash. It currently holds about 40% of its $8 billion under management in cash, investor updates show.

Bank of America Says Mistake Inflated Reported Size of Dark Pool (Bloomberg)
Bank of America said it sent incorrect data to a U.S. regulator that made its private stock trading platform look bigger than it actually is.

NJ faces another credit rating slash: S&P (Reuters)
New Jersey could be downgraded again because of its growing budgetary imbalance and underfunded public pension, Standard & Poor’s Ratings Services warned on Monday. S&P had already cut the state’s rating to ‘A+’ in April. Wall Street’s two other main credit rating agencies soon followed in slicing the state to a single-A rating. That put New Jersey among the three lowest-rated states, along with California and Illinois.

Prankster Vitalii Sediuk: I never hit Brad Pitt (AP)
The ex-journalist who was arrested after jostling with Brad Pitt at a film premiere last week said Monday he was merely trying to give the actor a hug and didn’t mean him any harm. Vitalii Sediuk, a former Ukrainian television reporter, told The Associated Press in an interview that was in a fan area of the event that was open to the public when he went in to give the actor a hug. Sediuk, 25, has gained a reputation for outlandish pranks on red carpets in Moscow, Los Angeles and last month, at the Cannes Film Festival when he crawled underneath America Ferrera’s dress at a film premiere. His contact with Pitt, which caused the actor to lose balance while he was signing autographs at the “Maleficent” film premiere on Wednesday, led to Sediuk’s arrest. He spent two days in jail before pleading no contest to battery and unlawful activity at a sporting or entertainment event and was sentenced Friday to three years of probation and a year’s worth of psychiatric counseling. “I’m a normal guy,” Sediuk said. “I’m not crazy.” The 6-foot-2 native of Boryspil, Ukraine said he initially wasn’t near the front of the fan area where Pitt was signing autographs last week, but saw paparazzi leave one area and headed for it. He said he stood on a metal railing and reached over to give Pitt a hug, toppling onto the carpet area as security grabbed him. Sediuk, who has hugged the crotches of Bradley Cooper and Leonardo Di Caprio and crashed the 2013 Grammy Awards said the primary purpose for his pranks is entertainment. “I’m doing this for fun,” he said.

For Now, Sponsors Unlikely to Cut Ties With Phil Mickelson (Dealbook)
Mr. Mickelson has signed a number of high-profile deals with sponsors, including Barclays and KPMG in 2008 and Callaway Golf in 2004. (The deal was renewed in 2009.) Experts say that given Mr. Mickelson’s standing in the sports world (he is ranked No. 11 by the Professional Golfers Association) and his long-term sponsorship relationships, it’s unlikely that any of the brands will cut ties just yet. “I think they will stand by him and wait for the investigation to proceed,” Mr. Knapple said.

Secondary Sales Squeeze Investors (WSJ)
The recent collapse of highflying technology and health-care stocks has stung buyers who paid steep prices for shares sold by the companies earlier this year in a surge of deals known as follow-on offerings. That has cooled demand for the sales, meaning companies won’t see the same strong pricing that prevailed earlier in the year. At the same time, the stock prices of companies that completed offerings before the rout may come under pressure as investors use any rebounds to sell and reduce their losses. When it comes to deals involving these once top-performing stocks, “Every purchase has been a bad purchase and every sale has been too small,” said Andrew Cupps, chief investment officer of Cupps Capital Management LLC.

U.S. says 77,000 banks, firms sign up to fight tax evasion (Reuters)
About 77,000 foreign and U.S. banks and financial institutions, including some in Russia, have registered with the United States to comply with a new law meant to fight tax dodging by Americans, the U.S. Treasury Department said on Monday. Deputy Assistant Secretary for International Tax Affairs Robert Stack said in a statement that the high level of registrations so far showed “strong international support” for the law, set to take effect on July 1.

Study: FL seniors are active but drink too much (WTSP)
A new national study is singling out Florida’s seniors for their unhealthy lives, in particular their love of alcohol and (maybe not coincidentally) their chronic health problems and struggles with mental health. The good news: Sunshine State residents who are at least 65 years old tend to be among the nation’s most physically active and least obese in the nation, helping to get Florida’s overall senior health ranking to the mid-level No. 28 spot…About 5 percent of Florida seniors report chronic drinking, defined as 60 drinks/month for men and 30/month for women. Forty-three other states performed better, according to the report.

31 comments (hidden to protect delicate sensibilities)
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Comments (31)

  1. Posted by Guest King Hamlet | June 3, 2014 at 7:40 AM

    It's the cover up that kills.

    If there was any alleged insider trading, better hope they cover their tracks wisely.

  2. Posted by guest | June 3, 2014 at 7:46 AM

    BoA must have wonky excel spreadsheets that automatically inflate positive figures. How else could they be producing so many data errors? It's got to be an excel problem otherwise it boils down to incompetence. It's can't be the latter….

  3. Posted by Guest | June 3, 2014 at 7:48 AM

    Way to go, Chris Christie.

  4. Posted by Mike Lynch, Autonomy | June 3, 2014 at 8:05 AM

    We also noticed a dramatic increase in errors once we made a similar switch to Quickbooks in an effort to cut costs. Worked out for us though

  5. Posted by Shank Slicer | June 3, 2014 at 8:38 AM

    In other news, Phil Mickelson wasn't concerned with the 118 he shot on the front nine of Angstwood CC during a round with supportive friends…..

  6. Posted by KingCo | June 3, 2014 at 9:00 AM

    60 drinks a month is "chronic drinking? Was this a Brigham Young study?

  7. Posted by Charlotte | June 3, 2014 at 9:02 AM

    Inflated? You should see BAML's Tindr profile

  8. Posted by Guest | June 3, 2014 at 9:33 AM

    I crap three times a week and my ungrateful kids never visit me at the retirement community they stuck me in. What else is there to do but drink, screw that little minx Phyllis in room 204 and play shuffleboard all day?

    - Palm Beach Secure

  9. Posted by SMU Secure | June 3, 2014 at 9:33 AM

    Charlotte is the goatse of the US.

  10. Posted by Guest | June 3, 2014 at 9:42 AM

    Charlotte>Detroit>Camden>Dallas

  11. Posted by Guest | June 3, 2014 at 9:51 AM

    Charlotte is a whaler's paradise.

  12. Posted by Guest | June 3, 2014 at 9:55 AM

    Detroit is the 'in the ass' capital of the world.

  13. Posted by Dr_Rosenrose | June 3, 2014 at 10:00 AM

    So 2 drinks per day is now both the recommended amount to prevent heart disease, and evidence of chronic drinking. Thanks for clearing that up.

  14. Posted by gest | June 3, 2014 at 10:03 AM

    I actually thought that did sound like a lot…especially given that their, what, 70+? 1 beer for a 70 year old must equal at least 2 for your average young buc. At least they're having a great time.

  15. Posted by Shazman | June 3, 2014 at 10:07 AM

    Also recommended to prevent heart disease, not asking why Bess is showing at the office wearing the same clothes as the day before.

  16. Posted by Shits weak | June 3, 2014 at 10:09 AM

    "Join us June 18th in New York for Dealbreaker Dramatic Reading Night Part III"

    So it's safe to assume Bess will show up on the 19th like nothing happened.

    -Guy who thinks it's sad to see OB's posted 3 times a week and the amount of comments down substantially.

  17. Posted by Dad | June 3, 2014 at 10:35 AM

    Funny, "Jersey Downgrade" is what we used to call hiring Princeton summer interns

  18. Posted by Guest | June 3, 2014 at 10:59 AM

    Phil Mickelson + 3 bad years = Rob Ford

  19. Posted by Ching Chong | June 3, 2014 at 11:03 AM

    Phil Mickelson – Rob Ford = 3 good years ?

  20. Posted by C'mon | June 3, 2014 at 11:44 AM

    If 60 drinks/mo is chronic drinking, consider me Miles Davis

  21. Posted by guest | June 3, 2014 at 11:54 AM

    what the fuck are you talking about?

  22. Posted by guest | June 3, 2014 at 11:54 AM

    you're an idiot.

  23. Posted by guest | June 3, 2014 at 11:56 AM

    "So it's safe to assume Bess will show up on the 19th like nothing happened. "

    huh?

    -guy who's been to the two previous dramatic reading nights and can't wait for the third, who has no idea what you're getting at, sparky.

  24. Posted by guest | June 3, 2014 at 11:57 AM

    aw, is someone bitter they live in bumblefuck USA and can't come to the party?

  25. Posted by SBOE | June 3, 2014 at 11:59 AM

    In fact, Barclay's discussed giving him a bonus in the unlikely event he's indicted.

  26. Posted by guest | June 3, 2014 at 12:06 PM

    and yet here you still are, reading and commenting, bitter boy.

  27. Posted by A Cohn Brother | June 3, 2014 at 12:40 PM

    When I think of the Dealbreaker planning sessions for the upcoming Dramatic Reading Night, I imagine that Bess is the Maude Lebowski character to Shaz's Knox Harrington. The commentariat is, collectively, The Dude.

  28. Posted by guest | June 3, 2014 at 12:43 PM

    The Dude: Who the fuck are you, man?
    Knox Harrington: [giggles] Oh, just a friend of Maudie's.
    The Dude: Yeah, a friend with a cleft asshole?

  29. Posted by What Deep Pockets? | June 3, 2014 at 12:45 PM

    We need the Geezer to chime in on this.

  30. Posted by Donny | June 3, 2014 at 1:16 PM

    Scene: (In Bess' office at Breaking Media……)

    Maude (Bess) is talking to Jeffrey Lebowski/The Dude (commentariat) while a phone is ringing near Shaz. Reluctantly at first, Shaz (Knox Harrington) answers the phone and begins to giggle:

    Shaz: (Giggling) "It's Greg Williams about Levine…"

    Bess: (To Jeffrey) "I'm sorry. I must take this…."

    Bess gets on a second line and says hello and begins to giggle and laugh like Shaz.

    The Dude is confused and stares at both of them.

    END SCENE

  31. Posted by Chung Chang | June 3, 2014 at 2:46 PM

    Phil Mickelson
    ——————— = 6.25 Great months??
    Rob Ford