Opening Bell

Opening Bell: 11.27.13

London Gold Fix Calls Draw Scrutiny Amid Heavy Trading (Bloomberg)
Every business day in London, five banks meet to set the price of gold in a ritual that dates back to 1919. Now, dealers and economists say knowledge gleaned on those calls could give some traders an unfair advantage when buying and selling the precious metal. The U.K. Financial Conduct Authority is scrutinizing how prices are set in the $20 trillion gold market, according to a person with knowledge of the review who asked not to be identified because the matter isn’t public. The London fix, the benchmark rate used by mining companies, jewelers and central banks to buy, sell and value the metal, is published twice daily after a telephone call involving Barclays Plc, Deutsche Bank AG, Bank of Nova Scotia, HSBC Holdings Plc and Societe Generale SA.

Volatile Loan Securities Are Luring Fund Managers Again (WSJ)
Investment funds aimed at individual investors are barreling into collateralized loan obligations, a complex and volatile type of security that was shaken by the financial crisis. Lured by annual returns of as high as 20%, some mutual-fund managers are buying CLOs through investment funds that purchase stakes in loans to companies with low credit ratings. Another type of loan investment fund, business-development companies, also have begun buying CLOs, according to securities filings.

Alfred Feld, Goldman Sachs’s Longest-Serving Worker, Dies at 98 (Bloomberg)
Alfred Feld, who joined Goldman Sachs & Co. in 1933 and rose from office boy to private-wealth manager and became the firm’s longest-serving employee, has died. He was 98. He died on Nov. 25 in Palm Beach, Florida, according to a memo distributed yesterday by Chief Executive Officer Lloyd C. Blankfein and President Gary D. Cohn. No cause was given…Feld this year celebrated his 80th anniversary with the bank, which had 200 employees, including five partners, when he joined. The firm became Goldman Sachs Group Inc. when it went public in 1999 and now has more than 32,000 employees. He started as a messenger in mail operations, before being promoted within five days to “office boy,” according to Andrea Raphael, a spokeswoman for the New York-based bank. He later covered the railroad industry as a research analyst, before becoming a financial adviser.

SAC money manager had ‘insider’ training (NYP)
SAC Capital money manager Michael Steinberg was trained to spot insider trading. Steinberg, who is on trial for conspiracy to commit securities fraud, attended three training sessions on the topic run by SAC’s compliance department, an SAC executive said in court Tuesday. John Casey, a member of the $14 billion hedge fund’s compliance team, testified in a Manhattan federal court that SAC gave employees explicit rules about what it believed constituted insider trading and told them to ask compliance to put stocks on the firm’s restricted list if there was any doubt about the matter. But Casey said he was not aware that Steinberg had ever made any such a request.

Thanksgivukkah Spawning Menurkeys in Mashup Celebration (Bloomberg)
Owing to an overlap in the Gregorian and Jewish calendars, Hanukkah and Thanksgiving have collided for the first time since at least early last century. Merchants as varied as Amazon.com Inc., Martha Stewart and Teaneck’s Smokey Joe’s kosher barbecue are rising to the occasion with Thanksgivukkah menus, tchotchkes and merchandise. Exhibit A: the Menurkey, a turkey-themed menorah, the eight-tiered Hanukkah candelabra, dreamed up by a 9-year-old boy from Manhattan. For folks who want to commemorate the occasion there are “Gobble Tov” and “Happy Thanukkah” shirts. Americans will spend $2.38 billion on Thanksgiving dinner alone, according to the USDA National Agricultural Statistics Service. “Everybody’s excited about it,” Kahan said. “It’s like a double whammy, two for the price of one.” The holiday merger has spawned unlikely combinations, including maneschewitz-brined turkey, sweet potato bourbon noodle kugel, challah-apple stuffing and pecan pie rugelach.

Blackstone Books Profit With Hilton Hotels (WSJ)
In six years, Blackstone Group LP transformed Hilton Worldwide Holdings Inc. into the largest hotel company by rooms, more than doubling its $6 billion investment. That growth came not by expanding Hilton’s empire of company-owned hotels. Instead, the New York private-equity firm has taken a more economical route—renting out Hilton’s brand names such as Hampton Inn, Hilton Garden Inn and Doubletree to franchisees.

This man made a movie about his small penis (NYP)
Patrick Moote’s penis is so small, his girlfriend turned down his marriage proposal. Patrick Moote’s penis is so small, he traveled around the world looking for enlargement solutions. Patrick Moote’s penis is so small, he made a movie about it. In the new documentary, “UnHung Hero,” which is available on Showtime now and on DVD Dec. 10, comedian Patrick Moote searches for a way to deal with his less-than-large member. It all began when Moote’s girlfriend rejected his marriage proposal on a Jumbotron at a UCLA basketball game. Video of the fail went viral, and Moote’s girlfriend told him that one reason she couldn’t marry him was that his manhood just didn’t pack enough punch. In “UnHung Hero,” Moote sets out to change that, and answer the question, “Does size matter?” The Post asked him all about it. NYP: Why don’t you give a specific measurement for how small you are Moote: When you’re measuring an erection, there’s an average for it, but there’s no set number. If you put on 10 pounds it’s gonna take off a centimeter. If you’re not having a particularly good day with circulation, it’s going to affect it. If you’re feeling stressed out or your heat doesn’t work in your apartment, it’s going to affect how large it is. But the doctor who measured me, flaccid, she basically grabbed it by the tip and yanked on it and “low normal” is what she said. But like Dan Savage says in the movie, half of everyone is. NYP: How’s your sex life now? Moote: It’s interesting because the times that I have been on dates and the penis has come up, I think I’ve set the bar so low, girls are just surprised I even have a penis. A girl I had been on a couple of dates with before, it came out and she said, “Oh, my God, it’s not that small.” And I said, “That’s not really a compliment.” The expectations are so low I can’t disappoint. Read more »

Opening Bell: 11.26.13

Men’s Wearhouse Offers to Buy Jos. A. Bank (Bloomberg)
Men’s Wearhouse Inc., which less than two weeks ago let a takeover bid from Jos. A. Bank Clothiers Inc. expire without entering discussions, today offered to buy its smaller rival for about $1.54 billion. The proposal of $55 a share is 8.7 percent higher than Jos. A. Bank’s closing price yesterday and 32 percent higher than on Oct. 8, the day before it bid for Men’s Wearhouse. Jos. A. Bank rose above the offer price in New York trading. Men’s Wearhouse, taking the advice of its largest shareholder, Eminence Capital LLC, is turning the tables on Jos. A. Bank to expand its base of men’s clothing stores. The deal, which would create a company with about 1,700 stores, would add to earnings in the first year after closing, helped by as much as $150 million in annual savings in purchasing, customer service and marketing over three years, Men’s Wearhouse said today in a statement.

Departure Blurs Nasdaq Succession (WSJ)
Mr. Noll, 51 years old, said he would become chief executive of ConvergEx Group LLC, a broker for institutional traders and money managers. The move surprised many industry experts, most of whom had anticipated Mr. Noll would stay at Nasdaq until current Chief Executive Robert Greifeld retired. But Mr. Greifeld, 56, has shown no signs of leaving. His current contract, signed last year, lasts until 2017. Under direction from its board, Nasdaq had been working on an executive succession plan for two years, although no details have been made public.

Speed Traders Meet Nightmare on Elm Street With Nanex (Bloomberg)
The nemesis of Wall Street’s high-frequency traders operates out of an apartment-sized office above the Bliss Salon — manicure/pedicure $45 — on Elm Street in the Chicago suburb of Winnetka. Staring at four computer monitors,Eric Scott Hunsader, the founder of market-data provider Nanex LLC, looks for hints of illicit trading hidden in psychedelic images of triangles dancing with dots that represent quotes to buy and sell U.S. stocks broken down by the millisecond. Charts of trading produced by Hunsader’s eight-person firm have captivated everyone from regulators to art gallery owners. One stunt involved a computerized piano piece mimicking quotes for an exchange-traded fund. He infuriates some traders, who say Nanex draws unwarranted conclusions and spreads conspiracy theories. To Hunsader, the images created from market feeds are evidence of high-frequency trading firms exploiting market rules to turn a profit in a lawless environment. Though others in the industry see his reports and charts as propaganda, Nanex’s interpretations are helping to drive the public debate about the fundamental fairness of the modern stock market. “You ever see ‘Lord of the Flies’ or read that book?” he said, using the William Golding novel about boys stranded on an uninhabited island as a metaphor for the stock market. “When you don’t have a parent around, things fall apart.”

Banks To Sue Over New CFTC Rules (NYP)
JPMorgan Chase, Goldman Sachs and other financial firms — fuming over far-reaching new rules passed in the wake of the financial crisis — plan to haul the Commodity Futures Trading Commission to court. The banks, represented by industry lobbying groups, plan to sue the CFTC for violating rule-making procedures when it proposed new Dodd-Frank era regulations. A source familiar with the matter said that lawsuit, led by the International Swaps and Derivatives Association and the Securities Industry and Financial Markets Association, is “imminent.”

Eastwood daughter regrets drunken wedding (NYP)
A little more than a week ago, Clint Eastwood’s gorgeous daughter got hitched to Jonah Hill’s pit-stained brother in a drunken Las Vegas ceremony — and now she wants the courts to unmake her day. Francesca Eastwood, 20, stumbled down the aisle of Las Vegas’ Simple Wedding Chapel on Nov. 17 to wed “Shrek” look-alike Jordan Feldstein, 35, in a Christian ceremony held in front of an Elvis impersonator. “Francesca had immediate regrets,” TMZ reported Monday, adding that sources close to the couple said the wedding was “fueled by alcohol” and that she’s seeking an annulment. Eastwood is the daughter of the Oscar winner and actress Frances Fisher, 61, who played Kate Winslet’s mother in “Titanic.” The party-loving Francesca starred on the reality-TV show “Mrs. Eastwood & Company” with her stepmother and other family members in their fancy California home. Feldstein is a music manager who made his name launching the career of his childhood friend, superstar Adam Levine of Maroon 5. He also manages Robin Thicke of “Blurred Lines” fame. The quickie wedding must have been a big surprise to Francesca’s on-again, off-again boyfriend, celeb photographer Tyler Shields, who said in February, “I’m really into Francesca . . . We will definitely get married. I’ve been looking at rings and I plan to propose in an interesting way.” Read more »

Opening Bell: 11.25.13

Former Treasury chief nixed BlackRock offer (NYP)
Tim Geithner passed up a chance to work at mega-fund manager BlackRock, according to sources. Geithner, who has landed a plum private-equity gig with Warburg Pincus, opted against joining CEO Fink’s BlackRock — with $4 trillion in assets under management — because he wanted to have a more involved role with any company he ended up joining. “I don’t think [Geithner] wanted to be someone’s arm candy,” said one source familiar with the situation.
Sources said Geithner appreciated the fact that Warburg’s top officials consisted of “talented guys with no big egos.”

Swiss Reject High-Pay Initiative (WSJ)
Swiss voters overwhelmingly rejected an initiative that would have restricted executive salaries to 12 times that of the lowest-paid employee. Roughly 65% of Swiss voters Sunday opposed the 1:12 Initiative for Fair Pay, according to results from all of the country’s 26 cantons reported by Swiss television. Another 34% supported the proposal, which was named for the organizers’ belief that no one in a Swiss company should earn more in a month than someone else makes in a year. The rejection of the 1:12 initiative marks a move away from Swiss efforts to more tightly govern how companies compensate their employees that has been driven by a growing wealth gap between the country’s executive class and everyday workers.

Wall Street May Take Derivatives Regulator to Court (Bloomberg)
Wall Street banks reeling from a flurry of activity by departing U.S. Commodity Futures Trading Commission Chairman Gary Gensler are considering taking the agency to court. Gensler has issued more than a dozen advisory opinions directed at reining in the largest financial firms and swap traders without votes by his fellow commissioners. He’s also insisting on tightening the Volcker rule ban on proprietary trading by banks, making last-minute demands that could derail a regulation that must be approved by five U.S. agencies. The financial industry’s trade groups have consulted with lawyers about how to block Gensler’s final moves, according to four people briefed on the matter. A lawsuit would probably be focused on CFTC guidance issued in July that described when the agency should defer its rules in favor of regulations by foreign derivatives overseers, the people said.

Private Equity Returns To Spain, Italy (WSJ)
Spain and Italy, two countries the private-equity industry had forgotten, could soon become a deal playground for European and U.S. buyout firms. At least 15 private-equity groups focused on the countries are looking to raise funds with a combined value of more than €4 billion ($5.4 billion), according to several people familiar with the matter and Preqin, a data provider. That is way more than the €1 billion raised since the start of 2010. The Spanish and Italian markets enjoyed popularity with private-equity firms between 2005 and 2008 but activity died down during the financial crisis. It has been further hit by the euro zone’s troubles.

Police to bars: Please don’t serve Santa (DDN)
For many, spotting jolly old Saint Nick will on the street will bring a smile to the face and warm feelings of holiday cheer. But you might excuse the New York Police Department for having thoughts of dread instead. The arrival of SantaCon now signals the onslaught of thousands of drunken holiday revelers dressed up as Santa on the city’s streets, and at least one police officer has had enough. The New York Daily News reports that a lieutenant with NYPD’s Midtown North Precinct recently wrote to bar owners in the area asking them to ban participants of the 2013 SantaCon. The event was originally billed as a fund-raiser, but has since evolved into a massive bar hop. In a letter to about three dozen bars and clubs in the Midtown and Hell’s Kitchen neighborhoods Lt. John Cocchi warns of “thousands of intoxicated partygoers” roaming the streets while “urinating, littering, vomiting” and other naughty behavior. The event is set to begin on Dec. 14 and while many bar owners welcome the extra business, many of those who live in the area aren’t so enthusiastic about the festivities. Bob Miner, a member of a local block association is hoping the revelers will pass by his neighborhood, “What do you tell a 5-year-old when they see a Santa passed out on the street, or carried by his buddies, or vomiting or defecating in front of the house?” Read more »

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: 11.15.13

UBS Still In Revamp Mode (WSJ)
UBS says it has long since finished restructuring its investment-banking arm. Behind the scenes, though, the Swiss bank recently toyed with potentially far-reaching alternatives for the unit. As recently as September, UBS held talks with Japan’s Sumitomo Mitsui Banking Corp., a unit of Sumitomo Mitsui Financial Group Inc., about forming a partnership that would have resulted in a significant portion of UBS’s Tokyo investment bank being moved off its balance sheet, according to several people familiar with the negotiations. Those discussions appear to have stalled, although one person said they could be rekindled. Meanwhile, at a corporate retreat in June, top UBS executives assessed the possibility of jettisoning the investment-banking unit altogether, according to people involved in those talks. The group decided that such a radical move would be unwise, these people said.

Ackman’s Pershing Buys Stakes in Fannie Mae, Freddie Mac (Bloomberg)
Bill Ackman’s hedge fund-firm took stakes in Fannie Mae and Freddie Mac, the government-backed mortgage insurers that investor Bruce Berkowitz is seeking to restructure, and said it may seek talks with management, shareholders and the government. Pershing Square Capital Management LP bought a 9.98 percent stake in the common shares of Fannie Mae and a 9.77 percent stake in Freddie Mac common stock, according to a government filing today. Pershing started buying the stakes on Oct. 7 and accelerated purchases after Oct. 21, according to the filing.

New Herbalife pacts block distributors from suing company (NYP)
Herbalife is making its new salespeople sign away their right to the sue the company. The new restriction in Herbalife’s latest agreement with distributors comes as the protein-shake peddler, led by CEO Michael Johnson, spends more on legal fees to defend against allegations that it is a pyramid scheme in which most of its salespeople lose money. “You agree that, by entering into this agreement, you and Herbalife are each waiving the right to a trial by jury … Class actions shall not be permitted,” it reads. The agreement, which went into effect in August, requires that the company and its network of independent distributors agree to settle any disputes through arbitration.

Jos. A. Bank Drops Bid For Men’s Wearhouse (WSJ)
“Jos. A. Bank continues to believe that a transaction could be in the best interest of the respective shareholders of the two companies,” Jos. A. Bank said in a statement early Friday. “If, in the future, we are invited by the Men’s Wearhouse board to discuss our acquisition of Men’s Wearhouse, or if circumstances were otherwise to change, Jos. A. Bank may consider whether a new proposal to acquire Men’s Wearhouse is warranted.”

Police: Psychic gambled $115K she got from client (L10)
A psychic in Boca Raton took $115,000 from a client, promising to give her back $90,000 and remove a curse from the cash, but instead gambled it away, according to the Boca Raton Police Department. In September, 30-year-old Amanda Berkofsky told police she was a victim of fraud, stating that psychic Stephanie Lee, later identified as Stephanie Thompson, took over $115,000 in cash from her and told her she would give her back $90,000. Berkofsky met Thompson in May 2012 at the Psychic Tea Room and decided to do a reading for $200 in cash. After the reading, Thompson told Berkofsky that she had a “curse” on her and it would cost her $2,000 to take it off of her, according to an arrest affidavit. After Berkofsky gave Thompson the money, Thompson told her that she needed more money to remove the curse, police said. Berkofsky told police Thompson said she would give the money back once she had “meditated” over it and it was clear. Berkofsky said she had to give Thompson the money she received from her mother so that she could clean it. Thompson told Berkofsky not to give her the money all at once, only in small amounts as not to bring attention to herself. Police said Berkofsky would meet Thompson at various locations around Boca Raton. They would meet at the CVS in the Fifth Avenue Shops and then go to Bank of America to withdraw money. Thompson would have Berkofsky go to different branches as not to raise suspicion, according to the affidavit. Thompson also told Berkofsky not to tell anyone about this or it would “erase” whatever work she had done, police said. Read more »