Opening Bell

Opening Bell: 08.19.14

Bidding War Breaks Out to Dominate Dollar Stores (WSJ)
Dollar General Corp, the biggest dollar-store chain in the U.S., on Monday offered to pay $9 billion in cash for the second-biggest, Family Dollar Stores Inc., the latest in a wave of retail mergers that comes as companies struggle with weak traffic and a glut of stores. The offer is an attempt to elbow out the smallest of the three rivals, Dollar Tree Inc., which signed an agreement to acquire Family Dollar three weeks ago. Family Dollar’s board said on Monday that it would review the new $78.50-a-share offer, but continued to recommend shareholders vote for its $74.50-a-share deal with Dollar Tree. Dollar Tree declined to comment. Family Dollar’s stock closed above either price at $79.81, suggesting investors expect the bids to go higher.

Louis Bacon’s Bahamas battle reaches New York court (FT)
A battle over Clifton Bay, a postcard-perfect patch of turquoise waters off the western coast of the Bahamas, has raged for years between a billionaire hedge fund owner and a Canadian clothing mogul. It has now spilled into a New York courtroom in what one side hopes will finally settle the score. Louis Bacon, the billionaire founder of hedge fund Moore Capital Management, took legal action last week by asking a US court to try to gain access to videotaped footage he believes will help him prove that Peter Nygard, founder of clothing manufacturer Nygard International and his Bahamian neighbour, has engaged in a smear campaign against him. The backdrop is a long-running legal feud involving multiple lawsuits over whether Mr Nygard is, as Mr Bacon alleges, harming the environment around Clifton Bay, a beach made famous by James Bond movies, where both men have compounds… The setting for the feud is the exclusive Lyford Cay community on Clifton Bay. In 1993 Mr Bacon bought a 150,000 sq ft estate in a gated community. His nextdoor neighbour is Mr Nygard, who also owns a large estate and has been a permanent resident of the Bahamas since 1986. Mr Nygard has constructed a “Robinson Crusoe playground” with volcanic, smoking Mayan temples, a disco club and 20 themed cabanas where he has hosted celebrities, according to his website.

Goldman to face Libya’s sovereign wealth fund in court over trades (Reuters)
Goldman Sachs and Libya’s sovereign wealth fund are set to meet in a London court over claims the Wall Street bank exploited a position of trust by encouraging the fund to invest more than $1 billion in trades that ended up worthless…The fund, which became a Goldman client in 2007, alleges that the bank deliberately exploited the relationship of trust and confidence it had established with LIA staff, causing the fund to enter into the disputed trades. The LIA estimates that Goldman made substantial profit of around $350 million on the trades, while it was left with “colossal” losses.

BofA’s Montag Becomes Sole COO as Darnell Seeks Transfer (Bloomberg)
Bank of America’s’s Thomas K. Montag, the lender’s top-paid senior manager, will become sole chief operating officer as co-COO David Darnell takes a new title so he can move to Florida. Darnell, 61, will be vice chairman and continue overseeing global wealth and investment management, as well as business banking, Chief Executive Officer Brian T. Moynihan wrote in a memo to employees. Montag, who has split the COO job with Darnell since 2011, will still run the investment banking and capital markets businesses.

Steven Cohen’s Firm Loses Another Top Executive (WSJ, earlier)
Thomas Conheeney, who rose over 15 years to become president of Mr. Cohen’s giant hedge-fund firm, resigned Monday, capping a tenure as head of the firm during which eight current or former employees were convicted on criminal charges related to insider trading. Mr. Conheeney was one of the firm’s most vocal defenders during the government’s prosecution of SAC Capital Advisors LP, now called Point72 Asset Management. He will be succeeded by Douglas Haynes, a former director at McKinsey & Co. who was appointed earlier this year to the hedge-fund firm’s executive committee. The turn to Mr. Haynes, 48 years old, is the latest in a series of changes the firm has made—or had thrust upon it—as it has grappled with the effects of the government’s insider-trading investigation.

The Reason We Yawn (WSJ)
To get to the bottom of yawning, scientists have performed dozens of experiments on groups of people and animals, including baboons and parakeets. Yawning is one of the animal kingdom’s great unifiers. It seems almost any creature with a backbone does it. A leading hypothesis is that yawning plays an important role in keeping the brain at its cool, optimal working temperature. The brain is particularly sensitive to overheating, according to Andrew Gallup, an assistant professor of psychology at the State University of New York at Oneonta. Reaction times slow and memory wanes when the brain’s temperature varies even less than a degree from the ideal 98.6 degrees Fahrenheit.

Man Fakes Death To Avoid Wedding (HP)
August 15 would have been Alex Lancaster’s wedding day — if her fiancee hadn’t faked his own death. Lancaster, 23, of the United Kingdom, reportedly met Tucker Blandford, also 23, in August 2012, when she was attending college in Connecticut. The two fell quickly in love. “He was such a gentleman. He showered me with jewelry. We would go out for a posh dinner on the tenth of every month to celebrate the day we got together,” Lancaster said, according to the Mirror. “I’d never been in love like that before. I met his family and they treated me like a daughter. His mum and I became so close.” Lancaster feared their good thing would come to an end when she returned home, so when Blandford proposed marriage, she was eager to say yes. The two talked every day and started planning a wedding in Connecticut. Lancaster said she spent money on a dress, invitations and for flights for Blandford so he could see her in the U.K. Things changed a few months ago, when she got a call from a man who said he was Blandford’s father. “He told me Tucker had been deeply depressed and wanted to die, so had thrown himself in front of a car,” she said, according to Yahoo! News UK. “The man explained that they had been trying to send Tucker off to a psychiatric unit for help. But it was too late. I couldn’t breathe. It was absolutely devastating.” She got off the phone emotionally shattered, but things took a weird turn when she called the family back a short time later. Blandford’s mom answered the phone, but had no clue that her son had died. In fact, he was alive and well. “She said Tucker was absolutely fine –- but she also thought we’d split up,” Lancaster told Reveal.co.uk. “She knew nothing about the wedding.” Lancaster quickly discovered that the venue they had supposedly reserved for their wedding had no record of their booking. Although Blandford has since texted to say he was sorry, and has paid back half the $1,200 he owes her for wedding-related expenses, Lancaster refuses any contact…Blandford admits Lancaster’s allegations are true. “I’m a terrible, awful person. I know I shouldn’t have told her I was dead, but I didn’t know what else to do,” he said. Read more »

Opening Bell: 08.18.14

Credit Suisse Caught Up in Espírito Santo Mess (WSJ)
The Swiss bank was responsible for putting together securities that were issued by offshore investment vehicles and then sold to retail customers of Portugal’s Banco Espírito Santo SA. Many customers didn’t realize that these vehicles were loaded with debt issued by various Espírito Santo companies and apparently served as a mechanism to finance the family-controlled empire, according to corporate filings and people familiar with Portugal’s investigation into the Espírito Santo affair. It is unclear what, if any, direct role Credit Suisse had in selling the securities to bank customers. Now those investment products are at the center of an unfolding scandal. Banco Espírito Santo was bailed out and broken up this month. Other parts of the Espírito Santo group have filed for bankruptcy amid alleged fraud and accounting problems. In addition to sinking the Portuguese stock market, the episode has undermined confidence in the European banking sector, analysts say.

Citibank could lose Argentina banking license (NYP)
If the banking giant obeys a US judge’s order and doesn’t pay out on tens of million of dollars bonds issued in Argentina under the laws of that country, it risks losing its banking license there — and the $2 billion it has in local deposits. But if it follows Argentine law and pays out on the bonds, it risks violating a US federal court order. Citi finds itself in the precarious position on Monday after Manhattan federal court judge Thomas Griesa, who is overseeing the bitter battle between hedge fund mogul Paul Singer and Argentina over $3 billion due on bonds defaulted upon in 2001, ordered the bank not to pay out on some of the country’s locally-issued bonds. Griesa initially exempted Citi’s Argentine law bonds from his sweeping order stopping payouts to exchange bondholders unless Argentina also paid Singer and other holdout bondholders who won the right to receive full payment. But Griesa changed his mind about Citi last month after Singer’s lawyers pointed out that some of the bonds for which Citi is custodian were also exchange bonds. Argentina missed a July 30 deadline to pay the Singer group, throwing it into a technical default on $15 billion of debt. That money is being held by Bank of New York Mellon. Citi has until Sept. 30 to fall in line, and the bank’s appeal was fast-tracked last week. But Citi is feeling pressure from both sides of the legal spat, its lawyers argue.

Dollar General Makes $9.7 Billion Family Dollar Counterbid (Bloomberg)
Dollar General plans to pay $78.50 a share in cash, compared with Dollar Tree’s bid of $74.50 a share in cash and stock, according to a statement today. The deal will generate $550 million to $600 million in cost savings annually three years after its completion, Dollar General said.

Power napping is no sleepy business (NYP)
In the city that never sleeps, there’s big bucks in napping. YeloCab can help you while away the lazy days of August for a metered fare of $1 per minute. And for all those zzzzzs there’s roughly $1 million in revenue for the power nap, day spa company. YeloSpa, home of the YeloCab sleeping cabin, is located in the Columbus Circle area. Each cabin has computer-controlled ambient lighting to lull you into your power nap, and, after the maximum stay of 40 minutes, to gently and naturally wake you, leaving you refreshed and set to resume your activities with more energy.

Hedge funds lusting to cash out of MGM (NYP)
The hedge funds benefiting from the turnaround at Metro-Goldwyn-Mayer still like the movie business, but an increasing number of them like the idea of cashing out even more. “We are definitely in the seventh inning of this investment,” says Steven Azarbad, the Chief Investment Officer at New York based Maglan Capital. “I and many others would really like a transaction.” Odds are they’ll get it — and soon. For one thing, interest in content of the sort created and stockpiled by the legendary studio has never been greater. Upstarts like Netflix and Amazon raised demand for movies and TV shows several notches when their video streaming services took off a few years ago.

Man Loses License Over 33 Year-Old Ticket (KATU)
A Portland man is trying to figure out how he ended up with an invalid license over a ticket from 1981. Kevin Berry said he was pulled over in Milwaukie at the beginning of August for a possible speeding ticket. He said he did not get a ticket for speeding, but was surprised to hear the officer say his license was not valid as of July 17. He said he checked with the Department of Motor Vehicles and was told that his license had been suspended after a ticket in 1981. “I think it’s crazy,” said Berry, who said he has been renewing his license faithfully and legally for decades. Berry contacted KATU for help finding answers. “I don’t remember anything like that. If my license had been suspended, I definitely would have taken care of that,” said Berry. “Sometimes I can be a procrastinator, but I’ve never procrastinated for 33 years!” The Problem Solvers contacted the DMV. A DMV spokesperson researched the issue and said there was an error back in 1981 and a record was created under the name “Berdy,” not “Berry.” The “Berdy” record showed the 1981 ticket and a suspension. Read more »

Opening Bell: 08.14.14

Banks Get Enforcement Letters in FX-Rigging Probe (Bloomberg)
Banks including JPMorgan Chase & Co. (JPM), Citigroup Inc. (C) and Morgan Stanley (MS) have been notified regulators are preparing enforcement actions on currency rigging, people familiar with the investigation said. Talks are progressing between banks, the U.S. Federal Reserve and the Office of the Comptroller of the Currency to settle investigations into alleged manipulation of foreign-exchange markets, according to two people, who asked not to be identified because the discussions are private. Some firms have received so-called 15-day letters outlining the agencies’ findings and warning that enforcement actions are likely, the people said.

Louis Bacon and Peter Nygard Move Bahamas Feud to New York (Dealbook)
Mr. Bacon, the founder of the hedge fund Moore Capital Management, has been fighting Mr. Nygard’s attempts to expand his beachfront land holdings, asserting that he has been illegally and surreptitiously adding to the size of his compound to the detriment of the local environment. The suit argues that Mr. Nygard has also commercialized his property, turning it into a celebrity party hangout and that he has ignored a government order in 2010 to limit his building activities. Mr. Bacon, who has bought up and preserved vast tracts of land in New Mexico and Colorado, also owns a grouse-hunting estate in Scotland and an undeveloped island off the Long Island coast. Since 1993 he has owned a retreat in the Bahamas that abuts Mr. Nygard’s ever-expanding compound. Mr. Nygard, in turn, has attacked Mr. Bacon directly and indirectly in the Bahamas via articles in the news media and videos online. According to the lawsuit, Mr. Nygard has hired journalists to write articles that paint Mr. Bacon as a murderer, drug trafficker and a member of the Ku Klux Klan. A lawyer for Mr. Nygard, Richard Good, said in a statement: “Today’s lawsuit is a continuation of Louis Bacon’s malicious campaign against Peter Nygard with the objective of obtaining Mr. Nygard’s Bahamian property (Nygard Cay), through illegal means, and to wrongfully continue to damage Mr. Nygard’s businesses and reputation.” Mr. Good added that Mr. Nygard would file a countersuit in New York. Mr. Bacon’s lawsuit asserts that Mr. Nygard has hired outsiders like the Nation of Islam preacher Louis Farrakhan to support his claims in the Bahamas that Mr. Bacon is a racist.

Bank of America $17B pact still being haggled over (NYP)
The Justice Department’s mammoth $17 billion proposed settlement with Bank of America, expected to be inked last week, is still being haggled over, sources said. In recent weeks lawyers have been focusing on consumer relief and the statement of facts among other terms, three sources have said. An immense amount of paperwork and concerns about wording in the settlement are taking up much of prosecutors’ and BofA lawyers’ attention, three people said. The relief for individual states is another point that could potentially collapse, but is largely settled, two of those people said…New York, California, Illinois and Delaware are the four states that are angling for a bigger share of the relief, The Post has learned from two sources. The four states, along with the US Treasury, are looking to get a chunk of about $9 billion, with the rest going to consumer relief, two people said. The deal is now expected to be announced early next week, according to sources, roughly three weeks after the bank agreed to the broad outlines of the deal.

Four bidders vying for Barclays indexing unit (NYP)
Bloomberg, Standard & Poor’s, MSCI and financial data firm Markit are each in talks to buy the index group, sources said. The discussions are early, one source added — saying they were in the first of two expected rounds of talks. The indexing unit makes money by licensing its formula to companies looking to mimic its returns. The indexes, largely made up of bonds and currencies — collectively known as fixed income — attract billions in assets. The two largest bond exchange-traded funds, run by Vanguard and iShares, both use Barclays’ bond benchmarks as their gauges, and collectively have more than $30 billion in assets, according to data from Bloomberg News. PIMCO, the largest bond fund in the world, also uses Barclays indexes for investing.
Barclays inherited the indexing group after the bank bought the crashed Lehman Brothers in 2008.

Gift of GQ Magazine Prompts Outcry From Lands’ End Customers (NYT)
The free magazine was meant as a gift from Lands’ End — the retailer known for its conservative, sturdy clothing — to its most valued customers. But when the July issue of GQ landed in mailboxes across the country, the cover model was not wearing a monogrammed oxford or polar fleece. Instead, she was topless except for a strategically placed white flower lei. And some of the company’s shoppers were none too pleased. “My 14-year-old son brought in the mail today & was quite disturbed & fascinated by a ‘gift’ Lands’ End sent us — a copy of GQ magazine with an absolutely OBSCENE cover!!!,” wrote one mother on the company’s Facebook page, which filled up with dozens of complaints. “I am appalled that Lands’ End — which I have always thought of as a ‘wholesome,’ family-oriented company — would be the one to expose my son to pornography!” Another said: “We received your ‘Lands’ End Bonus’ of GQ magazine this weekend, and we are absolutely horrified. How can buying something as family friendly as school uniforms lead to soft porn in the mailbox? I’m thankful my son did not bring in the mail.” […] By Wednesday, the negative reaction had grown so strong that the retailer issued a mea culpa to its shoppers. “I would like to start by extending my most sincere apologies,” Edgar Huber, the chief executive of Lands’ End, wrote in an email. “We are aware that you have received or will be receiving shortly the July issue of GQ magazine with a suggestive cover.” Mr. Huber explained that GQ, a men’s magazine, was included as part of the subscription offer “since we did not want to exclude our male customers.” He also wrote, in bold letters, “There are simply no excuses; this was a mistake.” Read more »

Opening Bell: 08.13.14

Barclays Seen Facing $2 Billion in Misconduct Costs (Bloomberg)
The U.K.’s second-largest lender may incur a 700 million-pound charge to settle a foreign-exchange probe with regulators and a further 200 million pounds relating to a U.S. investigation into its private-trading venue, Chirantan Barua, an analyst at Bernstein in London, said in a note today. The bank could reach settlements by the end of 2014, he said.

Banks Woo Treasury Sanctions Pros to Navigate Complex U.S. Rules (Bloomberg)
Companies including HSBC Holdings Plc (HSBA) and Deloitte Touche Tohmatsu Ltd. are beefing up compliance expertise to ensure they or their clients don’t violate the set of programs the Treasury Department has more than doubled to 37 over the past decade. At least eight people of a staff of about 200 have left the Treasury’s Office of Foreign Assets Control in the past year, including no fewer than six in 2014. As sanctions become the key weapon of economic pressure the U.S. is using to achieve its security and foreign policy goals, companies are rushing to hire employees versed in the intricacies of the Treasury’s rules. For banks, investment firms and the consulting companies helping them steer clear of violations, the stakes are higher because fines are getting bigger and the list of banned individuals and businesses has swelled to about 5,800.

Banks Retreat From Market That Keeps Cash Flowing (WSJ)
A critical part of the plumbing that keeps money flowing through the financial system is experiencing turmoil as new regulations prompt banks to step back from the multitrillion-dollar “repo” market. The large and opaque market for repurchase agreements helps keep finance and trading moving, allowing hedge funds, investment banks and other financial firms to borrow and lend short-term funds, often overnight. But there have been increasing signs of trouble. Big banks, which act as middlemen between borrowers and lenders, have been pulling back. In recent weeks, senior bankers have said they are reluctant to participate in the market because of regulatory requirements that make repo trading more expensive.

Using Software to Keep Pro Athletes and Startup Millionaires From Going Broke (BusinessWeek)
Wealthfront recently announced another publicity-friendly program, this time with a different group of millennials in mind: pro athletes. The company has an agreement with the San Francisco 49ers to offer investment advice to the organization’s employees and alumni, with the team covering fees on the first $100,000 each person invests. The idea is that rookie athletes aren’t so different from startup founders when it comes to their finances. Both might be about 23 years old, earn a salary of a few hundred thousand dollars, and wonder what to do with incentives that can reach into the millions—like a signing bonus or endorsement deal for the player, or equity for the coder. As part of the 49ers deal, Wealthfront will offer seminars on how to handle these windfalls. Professional athletes are notoriously bad at managing their finances. A 2009 Sports Illustrated investigation found that 78 percent (!) of former NFL players have gone bankrupt or are under financial stress within two years of retiring.

CrossFit Flirting: Talk Burpee to Me (NYT)
On a recent Saturday night at the Promenade Bar and Grill in the Kips Bay neighborhood of Manhattan, the gym buddies Festa Radoni, 26, and Ellen Gerlach, 29, flexed their biceps, comparing muscles as a male friend snapped photos. “She’s much better at pull-ups,” Ms. Gerlach said, laughing as she elbowed Ms. Radoni. Over in the corner, Caley Crawford, 25, in five-inch green heels and polka-dot shorts, hung out in a squat position while sipping her drink and chatting. Nearby, two women in strappy dresses discussed how much weight they could snatch — move quickly from ground to overhead — with two men who, like everyone else at the evening’s event, do CrossFit, a popular high-intensity strength and conditioning program that involves lifting very heavy weights. “Her grip strength is unreal,” one of the men said later of one of the women. He sounded awed. It was a fairly tame evening out with Team Dangerous, a kind of interfraternity council for CrossFit gyms in the five boroughs, whose other events — among them a prom (dress code: “gym flair”) — have been known to devolve into tequila-fueled handstand push-ups in the street or a penalty of 10 burpees (an explosive squat-push-up-leap combination) for whoever stopped drinking beer. The two-year-old group’s stated mission is to combine fitness and social activities with charity, but it mostly functions to widen the dating pool for CrossFitters. “I don’t want to jinx myself, but that’s very true,” admitted a co-founder, Jason Lucking, 27, who is British, tall and flirtatious (he was, by several accounts, a credible copy of the Australian actor Chris Hemsworth at a CrossFit Halloween party). Read more »

Opening Bell: 08.12.14

Ex-SAC Capital Manager Martoma Forfeiture Sought by U.S. (Bloomberg)
Former SAC Capital Advisors LP portfolio manager Mathew Martoma, convicted of orchestrating the most lucrative insider trading scheme in U.S. history, should be ordered to forfeit $9.4 million and required to pay a fine, U.S. prosecutors said. The amount sought is equal to Martoma’s 2008 bonus, and exceeds his reported net worth of $7.4 million, prosecutors said in a filing today in Manhattan federal court. Guidelines for the fine range from $20,000 to more than $570 million, representing twice the gains to SAC Capital of the illegal trades, prosecutors said. The court’s probation department recommended a fine of $20,000, they said, without making their own recommendation.

Falcone files for ‘divorce’ from LightSquared (NYP)
On Monday, Falcone filed “divorce papers” from LightSquared, his bankrupt wireless venture, in the form of a proposed plan of reorganization to lead the restructuring for LightSquared Inc., the smaller arm of the failed Reston, Va., startup. LightSquared Inc. owns a small swath of 5 megahertz spectrum, as well as the rights to the tax losses in LightSquared, which could be valued at more than $2 billion. LightSquared LP, by contrast, owns the larger, more coveted swath of L-Band spectrum. But its ability to come to life has been hampered by years of infighting between creditors, including Dish Network co-founder Charlie Ergen. Falcone was offered a chance to stay in the larger LightSquared LP restructuring if he dropped his litigation against Uncle Sam and Ergen, who he’s accused of screwing with the company so he could buy the assets on the cheap, sources told The Post. Falcone refused, and was erased from the current LP plan, which is being led by private-equity firm Fortress. Falcone’s new, smaller plan centers on a $560 million bid to restructure “Inc” along with JPMorgan. This will keep him in the spectrum game, as he plans to use the 5 megahertz of spectrum he gets from the restructuring and to buy more, a source familiar with his thinking told The Post.

Alibaba IPO Has Unusual Challenges for Bankers (WSJ)
For a start, the deal is likely to total more than $20 billion, according to people with knowledge of it. Bankers figure they will need to drum up orders for as much as four times the size of the deal from big institutional investors to create enough fervor to keep the shares rising in the days after it goes public, the people said. That will require seeking some buyers willing to pony up $1 billion or more for a slice of the deal to ensure demand.

Gross Reduces U.S. Government-Related Debt in July (Bloomberg)
The proportion of U.S. government-related debt in the $223 billion Pimco Total Return Fund (PTTRX) was 45 percent, versus 47 percent in June, data posted yesterday on the company’s website showed. That compared with 50 percent in May, the highest level since 54 percent in July 2010.

Barclays Quant Trading Unit Said to Take 60 Employees in Spinout (Bloomberg)
A Barclays trading team that’s leaving this year to start a quantitative investment firm will take 60 bank employees with it, adding to Wall Street’s migration to the $2.8 trillion hedge-fund industry. Olivier Durantel, Gregoire Schneider, Antoine Fillet and Maxime Fortin of the British bank’s nQuants unit will form the venture, according to a person with knowledge of the plans, who asked not to be identified because the information is private. The firm, which hasn’t yet been named, will use algorithms to trade mainly equities and other liquid securities globally.

Robin Williams, a Comic Force, Dies at 63 (WSJ)
Since his days on “Mork & Mindy,” a fish-out-of-water tale that ran for four seasons in which he played an alien from the planet Ork, Mr. Williams demonstrated a fully formed comedic style filled with tics and habits that would become his trademarks. Those idiosyncrasies, like monologues full of non sequiturs or unexpected accents, would help him quickly become one of the world’s biggest comedy stars and a favorite guest of late-night television talk shows. Even when not pictured on screen, Mr. Williams had a tendency to become the center of attention, including a celebrated turn as the voice of the madcap genie in the 1992 animated film “Aladdin.” “Robin Williams was an airman, a doctor, a genie, a nanny, a president, a professor, a bangarang Peter Pan, and everything in between. But he was one of a kind. He arrived in our lives as an alien—but he ended up touching every element of the human spirit,” President Obama said in a statement.

Miss Bumbum 2014 Contestants Hope To Have Brazil’s Best Butt (HP)
In Brazil, the “Miss Bumbum” contest is a nationwide annual undertaking to find the best derriere. This year’s 27 contestants, who represent the country’s different states, were announced last week. “Miss Bumbum 2014” will start in São Paulo on August 11. Brazilians have until November to vote online and determine the 15 finalists for the finale. This year the pageant will have a historic first after twins Rafaella and Graziella Fornazieri, representing Alagoas and Ácre respectively, entered the contest. Dai Macedo, a 25-year-old model with a 42-inch bottom, was crowned “Miss Bumbum 2013.” “It’s a lot of work, a lot of devotion,” Macedo told Agence France-Presse by way of an interpreter after winning the title. “I denied myself a lot of things. No nightclubs. No sweets. I went to the gym Saturdays and Sundays.” Read more »

Opening Bell: 08.11.14

Hedge Funds Are Digging Gold Miners (WSJ)
The NYSE Arca Gold Miners Index, which tracks 39 gold-mining companies, has soared 26% so far this year, compared with a 8.9% rise in gold and a 4.5% increase in the S&P 500. The gold-miner rally is a boon for high-profile hedge-fund managers such as George Soros and John Paulson—as well as traditionally gold-focused traders like Peter Palmedo and Eric Sprott. Their gold bets were pummeled last year, when a rise in bond yields and muted inflation dulled gold’s allure, sparking a stampede that drove the precious metal’s price down 28% and the gold-mining index down 54%.

Judge in Argentina default case slams Singer lobbyists (NYP)
Federal court Judge Thomas Griesa said the ads run by the lobbying group, Task Force Argentina — financed by Singer to help fight his decade-long legal and political battle to win the right to collect on defaulted Argentina debt — were “wrong” to attack the country’s New York lawyers. One ad claims that one of the lawyers, Jonathan Blackman, of Cleary Gottlieb, personally called Argentina President Cristina Kirchner to suggest the country default — while a second displays a drawing of the lawyer’s head on a vulture…Griesa called the hearing after seeing two-page “legal notices” in US newspapers, placed by Argentina, saying it had paid its bondholders. The ad referred to the $539 million Argentina wired in late June to make a payment to the vast majority of its bondholders who accepted a debt swap years ago. But the court would not allow the payment to be made unless Argentina also pays Singer and other creditors the $1.65 billion they demand on defaulted debt they own. The payment to Singer wasn’t made, so Argentina defaulted on $15 billion in debt. “False and misleading statements by Argentina must cease,” said Griesa in an hour-long monologue. The 84-year-old judge said if the false statements don’t stop, he might consider holding the country in contempt.

Putin Starving Companies of Cash They Can’t Obtain Abroad (Bloomberg)
Russia is limiting corporate access to domestic financing even as the escalating Ukraine crisis increasingly isolates companies from overseas sources of cash. The government’s about-face on its pledge to end a freeze on pension cash being used by private money managers risks raising corporate borrowing costs as it deepens the country’s economic slowdown. Some of Russia’s biggest issuers are already locked out of international capital markets as punishment for what U.S. and European leaders say is President Vladimir Putin’s support of separatists in eastern Ukraine.

Kinder Morgan to Consolidate Empire (WSJ)
Kinder Morgan Inc. is consolidating its vast oil-and-gas pipeline empire into a single company in a $44 billion deal amid investor worries about the enterprises’ growth prospects. The reorganized company will abandon the financial structure it helped popularize in the late 1990s: the master limited partnership. These complex tax-oriented offerings have caught on among energy companies facing substantial investments in infrastructure because of the U.S. oil and gas boom. But Kinder now is so big that the MLP structure is limiting, said Richard Kinder, the companies’ founder and chief executive. Combining all four of its publicly traded units into one corporation, he said in an interview, “will allow us to further expand the reach of the kind of projects we can do.”

The Proper Care and Feeding of Your Spoiled 23-Year-Old (Bloomberg)
Rich people have enough money to solve almost all their problems but one: children who grow up to be entitled, materialistic and unhappy slackers. Wealth advisers to the rich see this all the time, says Coventry Edwards-Pitt, who helps clients manage their affairs at Ballentine Partners, a wealth advisory firm outside Boston. Often, children of rich parents can’t seem to strike out on their own, she says. They start doomed businesses and give up on one job after another, all while draining Mom and Dad’s bank account (or their own trust fund) into their 30s and beyond. It’s a phenomenon many parents and tax advisers do a lot to enable, albeit unintentionally, Edwards-Pitt argues in a new book, “Raised Healthy, Wealthy and Wise.” Most parents want their kids to become successful, self-sufficient adults. But smart tax planning can sabotage good parenting. To avoid the estate tax, the wealthy are told they can and should give their children $14,000, or $28,000 per couple, each year, which they’re allowed to do tax-free. That’s hardly enough to retire on, but it’s a cushion most people don’t have. Young wealthy adults may go from job to job as they seek their “passion” without putting in the hard work to actually get anywhere.

Man Armed With Leaf Blower Arrested For Doing Yard Work In The Nude (TSG)
A Massachusetts homeowner was arrested Monday for “open and gross lewdness” after passing motorists spotted him–leaf blower in hand–doing yard work in the nude, according to cops. As Richard Capra, 69, worked on the curb appeal of his Shrewsbury home, “several vehicles were slowing down taking photographs,” according to the Shrewsbury Police Department. Responding to 911 calls, Officer Timothy Charland spotted Capra “completely nude, blowing off his driveway with a leaf blower.” Capra was “intoxicated and belligerent towards police” when questioned. Capra, arrested on a misdemeanor charge, was later released from custody after posting $500 bail. He is scheduled for an August 15 appearance in Westboro District Court. Future arrestees will be happy to learn that Capra was “issued clothing” prior to being placed in a Shrewsbury patrol car. Read more »

Opening Bell: 08.08.14

Goldman, JPMorgan in Senate’s crosshairs for commodities holdings (Reuters)
U.S. Senator Carl Levin is preparing a last push to bring Wall Street’s big commodity traders to heel during his final months in office, wrapping up a nearly two year-long probe that could potentially reveal abuses in energy and metals markets. Levin’s investigators have met with representatives from Goldman Sachs and JPMorgan Chase in recent weeks, according to sources familiar with the matter. Executives from those companies may appear at a hearing as early as September, during which Levin’s Permanent Subcommittee on Investigations would present the findings of the probe, the sources said…Specifically, Senate investigators have explored whether Wall Street has abused its commodities holdings at the expense of clients, consumers, the environment or the health of the market, according to the people familiar with the probe.

Richest Russians Deprived of Luxury Foods by Putin’s Ban (Bloomberg)
Wealthy Muscovites will have to forgo favorite dishes such as Australian steak and sushi with Norwegian salmon and will pay more for substitutes because of President Vladimir Putin’s import ban. Putin decreed that imports of meat, fish, vegetables, cheese and dairy products from the U.S., European Union, Norway, Canada and Australia be stopped, effective yesterday, and called to replace them with local products. The ban applies to countries that imposed sanctions against Russia for its annexation of Crimea.

Power Network Draws Rich Families to Chicago Banker Byron Trott (Bloomberg)
Five years after leaving Goldman, Trott, 55, is parlaying longtime links to the moneyed elite into an investment and advisory firm that specializes in helping rich families get richer. BDT — for Byron David Trott — plays two roles for its well-heeled clients. It provides advice on whether to merge, expand or sell businesses, as it did for Alberto. And it raises money from them to invest in other mainly family-led companies, either directly or through BDT’s private-equity funds. BDT managed $6.3 billion in client assets as of Dec. 31 and is raising $5.2 billion more, according to regulatory filings. “Byron’s got a blue-chip list of people who trust him,” says John Canning, chairman of Madison Dearborn Partners LLC, the largest Midwestern private-equity firm. “He’s played a key role in Chicago. Since most large investment banks are headquartered elsewhere, he’s been able to establish a unique practice advising on extremely large transactions.” Warren Buffett, the third-wealthiest person in the world, is the biggest name on Trott’s prestigious list.

Argentina pulls US into debt dispute with hedge funds (NYP)
Argentina is trying to rope Uncle Sam into its debt dispute with a group of “vulture” hedge funds. The embattled country sued the US in the Hague, contending that America’s court system has “committed violations of Argentine sovereignty and immunities.” The suit was filed in the International Court of Justice, which is the judicial organ of the United Nations. The Hague-based court said no action will be taken unless the US agrees to have the case heard in that court.

Developer Who Sued Zuckerberg Cites E-Mail Showing Offer (Bloomberg)
A property developer who sued billionaire Mark Zuckerberg for allegedly failing to assist him with business networking as part of a real estate deal produced an e-mail mentioning that the Facebook Inc. founder offered to help him in a “light” way. The e-mail and others filed in a lawsuit against Zuckerberg show the executive knew he made the promise and reneged on it, David Draper, the attorney for developer Mircea Voskerician, said in court filings. Voskerician says he gave the Facebook chief executive officer a 40 percent discount in 2012 on a $4.3 million property located behind Zuckerberg’s Palo Alto, California, home because he was promised introductions and referrals to boost his business. After trying and failing to reach Zuckerberg, Voskerician sued in state court in San Jose, California, to get the house back, claiming fraud, breach of contract and misrepresentation, according to the complaint.

Judge Says Man Wasn’t Specific Enough About Alleged Penis Amputation (AP)
A judge threw out a lawsuit filed by an Alabama man who claims a botched circumcision resulted in the amputation of his penis, ruling Thursday that the complaint wasn’t specific under state malpractice law. Jefferson County Circuit Judge Jim Hughey III ruled after a brief hearing that the suit filed Johnny Lee Banks Jr. and his wife lacked sufficient details but could be filed again to include specific times and dates of alleged actions…Banks and his wife last month sued Princeton Baptist Medical Center in Birmingham plus Drs. Michael Bivins and Alan Aikens and their employers. Banks alleges that he awoke from what was supposed to be a routine circumcision in June to realize his penis was gone. Attorneys for the doctors and hospital contend the medical procedure alleged in the suit never happened and predicted the lawsuit will be dismissed again if Banks pursues the claim. The defense filed sworn statements from two nurses who said Banks had a circumcision at the hospital in February, months before he claimed in the suit, but there was no record of any amputation. Read more »

Opening Bell: 08.07.14

BofA Said Nearing Up to $17 Billion Mortgage Settlement (Bloomberg)
Under the proposed terms, the bank would pay about $9 billion in cash and the rest in consumer relief to settle federal and state claims, according to the person, who asked not to be named because the negotiations are private. Details of the proposed accord, such as the relief and a statement of facts, are still being negotiated, the person said. The outlines of the deal were reached last week after a phone call between Attorney General Eric Holder and Bank of America Chief Executive Officer Brian T. Moynihan, the person said. During the July 30 call, Holder said that the government was ready to file a lawsuit in New Jersey if the bank didn’t offer an amount closer to the department’s demand of about $17 billion, according to the person.

Banks’ Failure on ‘Living Wills’ Frays Relations With Regulators (WSJ)
The failure of the biggest U.S. banks to convince regulators they can go bust without bringing down the financial system is likely to further strain an already tense relationship between Wall Street and Washington. On Tuesday, the Federal Reserve and the Federal Deposit Insurance Corp. told 11 of the largest banks to address significant shortcomings in so-called living wills they submitted showing how they can be dismantled under bankruptcy and without government support. Bank officials were surprised by the public rebuke. A senior executive at one of the banks noted his firm got a 19-page memo less than three hours before the public release by the Federal Reserve and FDIC. The executive said there was no communication with regulators beforehand.

Portugal Bans Short Selling in Banco Comercial Português Stock (WSJ)
Portugal’s market regulator has banned short selling in shares of Banco Comercial Português SA, as the rescue earlier this week of one of the bank’s biggest domestic rivals continues to reverberate through financial markets. The regulator said late Wednesday that the ban would take effect on Thursday morning and last until 11.59 p.m. The move follows a 15% drop in BCP’s share price on Wednesday.

Argentina’s Wall Street Fixers Joined by Deutsche Bank for Talks (Bloomberg)
Deutsche Bank AG (DBK) joined JPMorgan Chase & Co., Citigroup Inc. (C) and HSBC Holdings Plc in talks with Argentina’s holdout creditors to seek an agreement that would allow the country to resume paying its bonds, according to a person briefed on the meetings. Deutsche Bank joined an Aug. 1 meeting between the banks and hedge funds including Elliott Management Corp. that won a U.S. court order for full repayment on debt from Argentina’s 2001 default, said the person, who asked not to be identified because the talks are private. Banks are proposing to buy at least a portion of the defaulted bonds, he said.

Finger Wrestling Championships Feature Lederhosen, Beer (HP)
…in Germany, finger wrestling is the reason locals don their lederhosen and chug pilsner on weekends. The Bavarian town of Garmisch-Partenkirchen just hosted the 55th Finger Wrestling Championships, celebrating a sport that dates back to the 17th century. Dozens of finger-flexing athletes lock their digits in a tug-of-war. The object is to pull your opponent across the table using only one finger — usually the middle one — that fits into a strap. Mashable reports that there are actual techniques to Fingerhakeln, but really it’s all about pain tolerance and strength. Plenty of giant Bavarian and Austrian dudes end up dislocating their wittle fingohs, though. Read more »