Opening Bell

Opening Bell: 11.21.13

Goldman Sachs burned by bad currency bets in third quarter (Reuters)
Goldman Sachs Group Inc lost more than $1 billion on currency trades during the third quarter, recent regulatory filings show, offering some insight into why the firm, considered one of Wall Street’s most savvy traders, reported its worst quarter in a key trading unit since the financial crisis. Foreign exchange was the only trading area that was a money loser, according to regulatory data. In the third quarter, Goldman reported its weakest revenue – $1.3 billion – in fixed-income, currency and commodities trading since the height of the financial crisis.

Inside-Trading Probe of Height Securities Over Decision on Medicare Payments Hits Wall in Capital (WSJ)
Investigators are hitting a wall in an insider-trading probe of how a government funding decision made its way to investors before it was officially released, according to people familiar with the probe. The Securities and Exchange Commission and Federal Bureau of Investigation have been examining whether anyone in government illegally passed along information April 1 about a pending decision on Medicare payments, according to officials involved in the probe. A report from a Washington policy-research firm, Height Securities, correctly called the decision just before it was announced, which sent health-care stocks soaring. The incident has put the spotlight on the burgeoning business known as political intelligence, where lobbyists, policy experts and former government officials gather insights on policy changes that they then sell to investors. But investigators are struggling over how to distinguish between illegal insider tips and accurate predictions based on research and analysis, the people familiar with the probe say.

Fed Casts About for Endgame on Easy-Money Policy (WSJ)
Central-bank officials have been debating for months when to start paring the $85 billion-a-month bond-purchase program. They were surprised during the summer when their discussions and public pronouncements on the potential timing rocked markets, pushing interest rates higher and stock prices down. Minutes of the Oct. 29-30 policy meeting, released Wednesday, showed officials continued to look toward ending the bond-buying program “in coming months.” But they spent hours game-planning how to handle unexpected developments and tailoring a message to the public to soften the impact of the program’s end.

SAC exec used stolen info to make ‘lots of money,’ jury told (NYP)
SAC Capital Advisors ex-money manager Michael Steinberg used stolen business information to make money — “lots of money” — for himself and his company, a Manhattan federal court jury was told Wednesday. When Steinberg “traded on that illegal information, he broke the law,” prosecutor Antonia Apps said in her opening statement. The 41-year-old Steinberg, charged with conspiracy and securities fraud, is the seventh SAC executive to face charges in US Attorney Preet Bharara’s massive multiyear crackdown on insider trading. The high-stakes criminal case, which finished jury selection Wednesday morning, opened in the afternoon before a packed courtroom…The government’s key witness will be Jon Horvath, an SAC tech research analyst who reported to Steinberg. Horvath pleaded guilty last year to similar charges regarding trading in tech stocks Dell and Nvdia. Horvath was pressured into the criminal activity after some of his recommendations failed in 2007 and he was at risk of losing his job, according to the government. “Steinberg told him he needed to get edgy proprietary information,” Apps told the jury. Horvath will testify that he called Steinberg, who was vacationing in Mexico, with an illegal stock tip about Dell, and “one minute later” the accused started to sell Dell shares, making $1 million on the trade, Apps said. But Steinberg’s lawyer, Barry Berke, said Horvath made up the story because “he was facing a very long jail sentence” and “chose self-interest over the truth.”

Mexico’s president denies meeting Bieber after pop star’s tweet (AP)
Mexico’s president has denied a tweet by Justin Bieber saying the singer met with the president and his family prior to a show. It was the latest sour note in Bieber’s controversy-filled Latin American tour. President Enrique Pena Nieto’s office put out a tweet late Monday that read “@Presidenciamx denies meeting between President @EPN with the singer @justinbieber.” That was a response to a tweet from Bieber’s official account saying “just met some amazing mexican beliebers and the presidente of mexico and his familia.” Apparently, Bieber was confused about whether the president was there or not. Early Tuesday, Bieber wrote in a tweet, “correction. I met the presidente’s family and all their friends in the private meet and greet with all their security. They were very nice.” Read more »

Opening Bell: 11.19.13

JPMorgan Said to Agree to Details of $13 Billion Accord (Bloomberg)
JPMorgan Chase & Co. has resolved the last obstacles to a record $13 billion settlement of civil state and U.S. probes over the sale of mortgage bonds, clearing the way for a deal today after months of negotiations, two people briefed on the matter said. The accord includes a previously disclosed $4 billion settlement to end a 2011 Federal Housing Finance Agency lawsuit, said one of the people, who asked not to be identified because the discussions are private. While the deal would mark the largest amount paid by a financial firm in a settlement with the U.S., the Justice Department is still probing JPMorgan’s recruiting practices in Asia, energy trading and its relationship with Ponzi scheme operator Bernard Madoff. The New York-based bank has tapped $8 billion of $28 billion in reserves set aside since 2010 to cover legal costs.

Yellen Nomination for Fed Chairman to Get Vote This Week (Bloomberg)
Janet Yellen’s nomination to be chairman of the Federal Reserve is scheduled for a Senate Banking Committee vote this week, advancing her confirmation. The banking panel vote will be Nov. 21, setting the stage for a full Senate confirmation vote later this year. Democrats hold a two-vote lead on the 22-member committee and no Democrat has opposed her nomination. If confirmed, Yellen, the Fed’s current vice chairman, will become the first woman to lead the U.S. central bank.

Ex-SAC exec’s defense probes jurors’ social media postings (NYP)
“As long as it’s public information, it’s fair game,” Barry Berke, Steinberg’s lawyer, told The Post. “The world has changed. Today people have a social-media footprint that is 100 percent public, and lawyers should be looking at it.” Steinberg’s defense team has hired DOAR Litigation Consulting, one of the top jury consultants in the country, and last week DOAR received permission to bring three laptops into the courtroom. Berke told Judge Richard Sullivan in last week’s pretrial hearing that DOAR may be doing an extra level of due diligence on prospective jurors by Googling their names, checking out their social-media profiles and looking into public sites for asset searches. Berke told The Post that the searches of prospective jurors won’t happen in the courtroom, suggesting that DOAR would set up a war room of sorts to vet the panel. Jury selection in the highly anticipated trial could last two days. Steinberg is the seventh money manager at Steve Cohen’s SAC Capital Advisors to face charges of insider trading — and the highest-ranking executive at the $14 billion hedge fund to do so. Each of the previous six has been convicted — part of US Attorney Preet Bharara’s dragnet that has bagged 75 guilty verdicts since 2009. The extra level of juror scrutiny speaks to Steinberg’s fear that pretrial publicity will make it hard for him to get a fair trial. Sullivan denied a request by Team Steinberg to either move or postpone the trial. A more-detailed-than-usual juror questionnaire will be used in the case, however. Prospective jurors will be asked extensively about their knowledge of hedge funds and SAC. Those with any knowledge of SAC’s recent guilty plea on insider trading will be pulled into the judge’s chambers for more detailed, private questioning. The juror questionnaire will identify Steinberg as “an employee of a fund called SAC Capital.” But “hedge fund” was considered a “loaded term,” the judge decided.

OECD Warns of U.S. Threat to Global Recovery (WSJ)
The uncertain future of U.S. fiscal and central bank policies poses a growing risk to a global economic recovery that has already been weakened by a slowdown in growth in many developing countries, the Organization for Economic Co-operation and Development said Tuesday. In its twice-yearly Economic Outlook, the Paris-based research body said the U.S. debt ceiling should be abolished, and replaced by “a credible long-term budgetary consolidation plan with solid political support.” The report marks a significant shift in the OECD’s focus of concern, which in recent years has been centered on the euro zone’s attempts to tackle its fiscal and banking crises. While the OECD remains worried about the euro zone’s frailties, the most immediate threats to the global recovery now appear to come from the U.S, it said.

Toronto’s Mayor Rampages On, to City’s Shame (NYT)
The end did not come for Rob Ford, the mayor of this city, when he proclaimed his proclivity for oral sex on live television. It did not come when the police confirmed that they had a video of him smoking crack, something he had repeatedly denied, nor when he showed up drunk at a local festival, careened equally plastered on a dance floor, or when the local Santa parade told him to please stay away. It did not even come Monday, during a City Council meeting at which members voted to take away most of his budget and staff while he cantered around the chamber, heckling voters and knocking a City Council member to the floor. It seems that Mr. Ford, absent a decision to quit, will remain at the helm of Canada’s largest and most affluent city at least until his term ends next year. He says he has far too many phone calls left to make. “Are you aware that 2,200 people call me?” Mr. Ford repeatedly said Monday, adding that he also gets 138,000 emails a year that require a response, by way of explaining why he ought to keep his budget and staff. “I’m still doing the job!” Read more »

Opening Bell: 11.18.13

Treasury Arm Gets Earful From Asset Managers (WSJ)
Large firms such as BlackRock Inc., Pacific Investment Management Co. and Fidelity Investments are blasting a report by the Office of Financial Research that found asset managers could pose risks to the broader financial system. The finding is significant because it is among the criteria a group of senior U.S. regulators will use to determine whether large asset managers are “systemically important” and should be drawn in for stricter oversight.

Officials to Address Bitcoin at U.S. Senate Hearing (WSJ)
U.S. law-enforcement officials are set to outline the pitfalls and promises of virtual currencies such as bitcoin Monday at the first-ever Senate hearing on the matter. In testimony prepared for the hearing before the SenateHomeland Security and Government Affairs Committee, federal law-enforcement agencies said that while the anonymity and decentralized nature of some virtual currencies can pave the way for fraud, they also hold potential benefits. “The Department of Justice recognizes that many virtual currency systems offer legitimate financial services and have the potential to promote more efficient global commerce,” Mythili Raman, acting assistant attorney general for the department’s criminal division, said in her prepared testimony. “We have also seen, however, that certain aspects of virtual currencies appeal to criminals and present a host of new challenges to law enforcement.”

Geithner Joins Wall Street (NYP)
Former Treasury Secretary Tim Geithner will join private-equity firm Warburg Pincus next year after 26 years in public service, the company said. Geithner will become president at the New York-based buyout firm starting March 1, according to a statement Friday from Warburg Pincus. The former New York Federal Reserve bank president will report to Chip Kaye and Joe Landy, who have led the firm since 2000 and this year began sharing the title of co-chief executive officer, in managing the firm, investing its funds and communicating with investors.

Ireland Baldwin defends dad Alec Baldwin in Twitter rant (NYDN)
Ireland Baldwin, 17, whose father called her a “thoughtless little pig” on a 2007 voicemail message that went viral, told critics to keep their snouts out of her old man’s business after he blamed the meanie media for making him mull retirement. The teenager posted several messages to Twitter on Saturday night, insisting that her pops has a “kind heart” and that his boorish flip-outs should not define him. Baldwin’s ratings-challenged MSNBC show was suspended Friday after he allegedly hurled a homophobic slur at a paparazzo last week. He hinted on Twitter Sunday night that the show might not come back — even though he said it beat Anderson Cooper’s “360” on CNN every night. “Or should I say …. outperformed?” the temper-prone star tweeted. Read more »

Opening Bell: 11.14.13

JPMorgan Twitter Hashtag Trends Against Bank (Bloomberg)
JPMorgan Chase, the target of at least eight Justice Department investigations, was mocked and taunted by Twitter users after asking followers to send questions to an executive using the hashtag #AskJPM. The online forum, which the bank canceled late yesterday, was intended in part to give college students an opportunity to communicate directly with a senior executive, said Brian Marchiony, a spokesman for the New York-based company. “#Badidea! Back to the drawing board,” the bank posted less than six hours after its original post, which drew more than 6,000 responses from users in that span, according to social media tracking service Topsy…JPMorgan’s call for questions provoked jeers from Twitter users, who responded with sarcastic posts about the bank’s mounting legal woes. “Can I have my house back?” @AdamColeman4 posted. “Is it true ‘JPM stands for ‘Just Pay More’?’’ asked @SconsetCapital.

Yellen Signals Further Fed Assistance Going Into Hearing (WSJ)
Janet Yellen will report strong economic progress when she goes before the Senate Banking Committee Thursday, in her confirmation hearing for the top post at the Federal Reserve. The U.S. economy has grown “significantly stronger” since the 2008 financial crisis and ensuing recession, but it still needs help from the Fed as it continues to mend, Ms. Yellen will tell senators, according to prepared remarks released Wednesday. “We have made good progress, but we have farther to go to regain the ground lost in the crisis and the recession,” Ms. Yellen, the Fed vice chairwoman, will say in her opening statement.

Taper likely in next couple of months: Morgan Stanley (CNBC)
A tapering in the U.S. Federal Reserve’s massive stimulus is the right thing to do against the backdrop of a recovery economy and a scaling back of the stimulus program can be expected in the next couple of months, Morgan Stanley Chairman and CEO James Gorman told CNBC on Thursday. “Every now and then, markets behave like schoolchildren. They overreact, they run around like crazy. We know we’re going to have tapering, we know we are living in an artificial state of excess liquidity right now and it’s happening because the economy is recovering,” he said.

Woman With German Wise Men Weder di Mauro Wins Euro Bet (Bloomberg)
Beatrice Weder di Mauro, who made her name by being an expert on debt, can’t collect on one of her own: Nouriel Roubini owes her a bottle of Champagne for a 2012 bet they made about whether Greece would leave the euro. It didn’t, and she won. “We see one another from time to time,” she said of business professor and author Roubini, a frequent fellow panelist at international conferences. “And then we always say, ‘Champagne!’” Roubini, for his part, swears he’ll pay up “next time I run into her.” Swiss-born Weder di Mauro, 48, was the first woman ever to serve on the German chancellor’s council of economic advisers, known as the “wise men.

JPMorgan’s Fruitful Ties to a Member of China’s Elite (NYT)
To promote its standing in China, JPMorgan Chase turned to a seemingly obscure consulting firm run by a 32-year-old executive named Lily Chang. Ms. Chang’s firm, which received a $75,000-a-month contract from JPMorgan, appeared to have only two employees. And on the surface, Ms. Chang lacked the influence and public name recognition needed to unlock business for the bank. But what was known to JPMorgan executives in Hong Kong, and some executives at other major companies, was that “Lily Chang” was not her real name. It was an alias for Wen Ruchun, the only daughter of Wen Jiabao, who at the time was China’s prime minister, with oversight of the economy and its financial institutions. JPMorgan’s link to Ms. Wen — which came during a time when the bank also invested in companies tied to the Wen family — has not been previously reported. Yet a review by The New York Times of confidential documents, Chinese public records and interviews with people briefed on the contract shows that the relationship pointed to a broader strategy for accumulating influence in China: Put the relatives of the nation’s ruling elite on the payroll.

Bitcoin Couple Travels the World Using Virtual Cash (WSJ)
“In bitcoin,” Austin Craig repeated to the young woman behind the counter at the Lean Crust Pizza parlor in the Fort Greene neighborhood of Brooklyn, N.Y. “Can we pay in bitcoin?” “In what?” came the reply. Mr. Craig, 30 years old, was struggling to convince Nadia Alamgir of the existence of the virtual currency that has gained traction across the world, and whose value—after months of wild swings—on Wednesday reached records around $400 per bitcoin. It was midway through a tricontinental odyssey taken with his wife, Beccy Bingham-Craig, 29, and a film crew documenting their travails, which started in Provo, Utah. Their mission: to live on bitcoin alone. “It’s been consistently inconvenient and occasionally frustrating,” Mr. Craig said outside Lean Crust, “but never impossible.” Lean Crust advertised itself as bitcoin-friendly but hadn’t seen much virtual foot traffic. Ms. Alamgir eventually contacted the store’s owner, who arrived and processed the transaction, allowing Mr. Craig to munch on several slices…In Stockholm, they went hungry the first night. In Singapore, Ms. Binghman-Craig got a henna tattoo. At every stop, Mr. Craig said, they found at least one bitcoiner willing to help…In the end, despite skepticism from friends, family and the bitcoin community itself, the Craigs managed to live on bitcoin for over three months. “We really didn’t cheat,” Mr. Craig said. “Everybody thought we would.” Read more »

Opening Bell: 11.13.13

Mozambique Tuna Bonds Fund Anti-Pirate Fleet to Banks’ Surprise (Bloomberg)
Two months ago, Credit Suisse Group AG and VTB Capital Plc financed a flotilla of tuna boats for Mozambique, then packaged the debt into notes for overseas investors. It turns out the fleet also includes anti-pirate patrol boats, according to the French Foreign Trade Ministry. They are capable of being equipped with 20mm cannons and military drones, according to Stratfor, a global security advisory firm. Credit Suisse is adamant that its funding wasn’t used for armed boats.

Dan Loeb Wants To Meet With George Clooney (NYP)
Dan Loeb said Tuesday he would like to sit down with the Hollywood leading man and mend fences after Clooney called Loeb a “carpetbagger” for attacking Sony Corp. “I’d love to meet him some time and talk these things out,” Loeb said at a Dealbook conference. “We probably agree more than we disagree about the company. He obviously got worked up about our role. “I think he misinterpreted the goal and what we were trying to accomplish.” In August, Clooney went on a tirade against the activist investor, who had sent Sony a poison-pen letter pressuring it to spin off its film and entertainment assets. “A guy from a hedge fund entity is the single least qualified person to be making these kinds of judgments, and he is dangerous to our industry,” Clooney said.

For Yellen, Fed’s Dual Mandate Guides Thinking (WSJ)
When senators question Janet Yellen on Thursday during her confirmation hearing to be the next leader of the Federal Reserve, she will likely turn their attention to the central bank’s “dual mandate” of maximum employment and stable prices. Ms. Yellen has made this mandate the centerpiece of her argument for the Fed’s unconventional easy-money programs aimed at spurring a stronger economic recovery and lowering unemployment, a point her recent comments suggest she will seek to reinforce.

ECB’s Praet: All Options on Table (WSJ)
The European Central Bank could adopt negative interest rates or purchase assets from banks if needed to lift inflation closer to its target, a top ECB official said, rebutting concerns that the central bank is running out of tools or is unwilling to use them. “If our mandate is at risk we are going to take all the measures that we think we should take to fulfill that mandate. That’s a very clear signal,” ECB executive board member Peter Praet said in an interview Tuesday with The Wall Street Journal.

Zoo changes crocodile’s name in political row (TL)
A zoo in Saxony is re-naming Fidel the crocodile, who is of Cuban descent, after cultural groups voiced concerns about associations with Communist revolutionary Fidel Castro. Fidel is one of seven Cuban crocodiles – an endangered species – to have hatched in Hoyerswerda zoo last August. Zookeepers opted to give the hatchlings names associated with their traditional homeland. “We were simply looking for names which you immediately associate with their homeland of Cuba,” said director of the zoo in formerly Communist East Germany Carmen Lötsch. “Nobody intended it to be a direct reference to dictator Fidel Castro or indeed a glorification of him as a person,” she said. Fidel the crocodile was destined for a life in the limelight, however, as he soon gained notoriety for his aggressive behavior towards his siblings, whom he would regularly attack and bite. These misdemeanors earned him the nickname “Castro” in some circles. “But that really refers most of all to the critical aspects of Fidel Castro as a person, so one can really not be accused of in any way trivializing these actions,” said Lötsch. However a committee tasked with allocating cultural funding in the region, did not share that view, claiming the crocodile’s name was not consistent with its guidelines…Though Fidel may have become associated with being radical, his name change was anything but. He is now called “Fidelio.” …in a further twist to the tale, the name “Fidelio” may not stick for long either. Zookeepers do not actually have proof that the crocodile is male, since this requires a blood test to which the hatchlings have not yet been subjected. However, keepers have prepared for this eventuality and chosen the name “Fidelia,” should the crocodile turn out to be female. Read more »

Opening Bell: 11.12.13

Cyber attack ‘war game’ to test London banks (Reuters)
Thousands of staff across dozens of London’s financial firms will be put through a “war game” scenario on Tuesday to test how well they can handle a major cyber attack. In one of the largest exercises of its kind in the world, the test dubbed “Waking Shark II” will bombard firms with a series of announcements and scenarios, such as a major attack on computer systems hitting stock exchanges and unfolding on social media. It will be co-ordinated from a single room housing regulators, government officials and staff from banks and other financial firms, people familiar with the matter said. Hundreds more people are expected to be involved from their own offices as the exercise plays out, they said. Simulations are likely to include how banks ensure the availability of cash from ATM machines or deal with a liquidity squeeze in the wholesale market and how well firms communicate and coordinate with authorities and each other. There will be a particular focus on investment banking operations, one of the sources said.

Financial Holdings of Some SEC Staffers in New York Probed (WSJ)
The SEC’s inspector general’s office and the Manhattan U.S. attorney’s office have contacted a handful of New York-based employees this year as a part of an investigation involving possible improper personal financial holdings among staff, people familiar with the matter said. The new investigation appears limited to the SEC’s New York regional office, and there is no indication SEC employees are suspected of flouting trading rules on a widespread basis. Investigators are looking into whether employee holdings comply with the agency’s internal trading rules, which include a prohibition on trading shares of companies under investigation, people familiar with the matter said.

Dallas Fed president Richard Fisher: QE won’t go on forever (CNBC)

Yellen’s Challenge: Corralling Fed’s Many Voices (WSJ)
Ms. Yellen seems unlikely to usher in a sharp departure from the open and consensus-oriented style of current Fed chief Ben Bernanke, who is widely admired among central-bank officials for his inclusive approach. But some former officials see her trying to get the Fed to speak with a more coherent voice.

Leonardo DiCaprio and World’s 2nd Richest Man Are Backing Instagram Rival (Bloomberg)
Mexican billionaire Carlos Slim thinks he knows something about photo-sharing apps that Mark Zuckerberg doesn’t. Slim’s America Movil was among the investors in a $60 million financing round in Mobli, an application for iPhone and Android that lets users decorate pictures and videos with colorful filters similar to Instagram. Ido Sadeh, Mobli’s chief operating officer, said the Mexican phone company’s investment was “significant,” but declined to disclose the price…Actor Leonardo DiCaprio is among the investors who had kicked in a total of $28 million in the startup’s previous financing rounds. Mobli, which was founded in 2011, is based in Tel Aviv and New York.

Morgan Stanley says internet companies overvalued, lowers view (Reuters)
Morgan Stanley lowered its industry view on internet stocks to “in-line” from “attractive,” saying growth in the sector needs to accelerate to justify current valuations.

Happiness comes to Rupert Murdoch (USAT)
The trial of some of Rupert Murdoch’s close associates, accused of telephone hacking, bribery, obstruction of justice and conspiracy, is now underway in London, threatening to expose ever-deeper veins of skulduggery in Murdoch’s company. Surely a low point in his 60-year career. And yet, Murdoch is telling people he may never have been happier in his life…His personal life, his work life and his family life, despite the threat of hackinggate, have all come into alignment. At 82, he believes he has set the stage for another 15 years. Hackinggate rather seems to have given him the impetus, in some Godfather fashion, to settle scores and take care of business so he can get on with the next chapter of his epochal story. First, he dealt with the long-standing friction of his marriage. Try as he might, for the 15 years he’s been married to Wendi Deng, 39 years his junior, he has never wholly managed to effect a rapprochement between her and his adult children, who are, for Murdoch, the tent poles of his life. At the same time, he has found it hard to admit that his marriage was in difficulty, even as he and Deng increasingly lived apart. It was Deng’s telling moment in the sun — stepping between Murdoch and a pie wielder when he was called, two years ago, to testify about hacking before Parliament — that he has told friends crystallized his anger. He realized he did not want her protecting him now — making him look old, he felt, and weak — or his legacy later. With the encouragement of his children, he began to plan his exit — his resolve aided by his closer monitoring of her personal life. In June, acting on new reports about her involvement with Google’s executive chairman, Eric Schmidt, he summarily ended his marriage — to no one’s greater surprise than his wife’s. His own hurt feelings have been soothed by a new romantic interest, a younger woman who has been traveling with him — his massage therapist — who, he has told friends, has made him very happy. Read more »

Opening Bell: 11.11.13

Big Banks May Block Traders From Chat Rooms (WSJ)
JP Morgan and Credit Suisse are discussing internally whether to disable computerized chat rooms that electronically link traders across multiple banks and are used by tens of thousands of employees globally, according to people familiar with the discussions. Royal Bank of Scotland Group, Barclays, UBS, and Citigroup among others, also are reviewing chat-room use and standards for controlling and monitoring all electronic communications, according to people at those and other banks and firms that do business with them. Chat rooms have become integral to the way traders communicate with one another and clients. Trading desks around the world that buy and sell currencies, commodities, equities and fixed-income assets rely, at least in part, on so-called multidealer chat rooms, which link multiple banks and their clients primarily through their Bloomberg terminals. But a series of regulatory probes into interest-rate rigging and possible manipulation of other markets has turned a spotlight on the chat rooms. The potential for hefty fines and damage to their reputations has some banks considering what would amount to a radical overhaul of the way traders conduct their business.

SAC plea deal on ice as judge delays decision (NYP)
The hedge-fund giant pleaded guilty Friday to insider-trading charges and agreed to pay $900 million in criminal penalties to settle a long-running probe by the Justice Department. But in a surprise move before a packed courtroom, Manhattan federal judge Laura Swain said she would hold off until March on whether to approve the plea deal. Swain said she wanted to see pre-sentencing reports prepared by the probation department before allowing the landmark settlement to proceed…Swain set the sentencing for March 14 — after two more insider trading trials involving former SAC money managers. Michael Steinberg goes on trial Nov. 18, while Mathew Martoma’s case is set for January.

Regulators urged to probe metals markets abuse (FT)
Britain’s parliamentary financial watchdog has urged regulators to probe potential abuses in metals markets as deeply as they are investigating the ongoing scandals over foreign exchange and Libor benchmark interest rates.
Andrew Tyrie, chairman of the Treasury select committee, told the Financial Times that MPs were conscious of growing concerns that the manipulation of rates – already exposed in the Libor affair, and now under investigation in a mounting regulatory probe into potential forex abuses – may go well beyond those areas and into metals markets.

Twitter Puts Spotlight on How Firms Burnish Results (WSJ)
The strong interest in Twitter’s initial public offering brought back to the fore the accounting methods that companies can use to burnish otherwise lackluster results. Twitter has recorded a loss of more than $130 million this year using traditional accounting measures. But after stripping out several costs, Twitter posted a nine-month profit of almost $31 million…Today, it is common for tech companies to exclude large stock payments to employees from preferred measurements. Some also remove other costs, such as restructuring or acquisition expenses. Some companies even tout nonfinancial measurements, such as an increase in the user base. The SEC is watching that practice. “Our staff’s concern has been the impact on investors of the sheer magnitude of some of these metrics,” SEC Chairman Mary Jo White said in a speech Wednesday. For investors “it can be hard not to think that these big numbers will inevitably translate into big profits for the company. But the connection may not necessarily be there.” She didn’t name any companies.

Edwin Tobergta, Sentenced To 11 Months For Sex With Pool Raft, Also Had Sex With Pumpkin (HP)
Edwin Tobergta of Hamilton, Ohio, is now famous as the man caught having sex with a pool raft. His sentencing hearing this week offered a little insight into his proclivities. One thing that stands out: He once pleasured himself with a pumpkin. Tobergta was sentenced this week to 11 months in prison for defiling the inflatable raft, according to WXIX. He committed the act in June, in front of children. At an earlier court session, Tobergta plead guilty to public indecency. This is the second time Tobergta has been caught in flagrante delicto with an inflatable pool toy. The same thing happened in 2011. But a less reported aspect of Tobergta’s checkered history with the law occurred in 2002, when he was arrested for allegedly diddling an inflatable pumpkin that was part of a Halloween display…Tobergta apologized in court before being sentenced. “I do want to apologize for my actions, I’m sorry,” he said. “I’m ready to get my life together and quit all this nonsense.” Read more »