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He may not even be allowed to set foot in the Staples Center parking lot on game nights, but Donald Sterling is motivated by a much higher force: spite. Strong, powerful spite. Strong enough to contemptuously dismiss an offer nearly four times as high as any received by an NBA team in history. Strong enough to cling to the Clippers despite being banned from the league for the rest of his declining years. And strong enough to force his family trust into default and a probable fire-sale of real estate just to deny Shelly Sterling the satisfaction of making him $1 billion richer. Read more »

When Brady Dougan & co. pleaded guilty to being a Swiss bank earlier this year, it doomed the firm to its worst quarter since the financial crisis. On the other hand, if it weren’t for helping non-Swiss people avoid taxes, there probably wouldn’t even be a Credit Suisse in the first place. So, you know, totally worth it. Read more »

Opening Bell: 07.22.14

Argentina asks U.S. judge to put debt payment order on hold (Reuters)
Argentina asked a U.S. judge on Monday to put on hold an order requiring it to pay bondholders who did not participate in debt restructurings following the country’s 2002 default, while it seeks a “global resolution.” Ahead of a July 30 deadline to reach a deal or face a new default, Argentina filed papers asking a New York federal judge to stay a ruling that it pay the holdout investors $1.33 billion plus interest. Argentina, which has been in settlement talks, said any deal must take into account other bondholders and factor in a clause in its restructured bonds that could open it up to further liability. “As those risks remain, so does the necessity and appropriateness of a stay,” Argentina’s lawyers wrote.

Money Manager Foiled By Bad Bets (WSJ)
A former Olympic fencer who was one of the few hedge-fund managers to predict the financial crisis is floundering in more placid markets. Balestra Capital Partners LP, founded by Wall Street veteran James Melcher, saw investors yank more than $600 million—or more than 60% of its assets—at the end of the second quarter, according to investor documents. New York-based Balestra’s investments were down more than 14% for this year through the end of June, the documents show. The 74-year-old Mr. Melcher, who competed for the U.S. in fencing at the 1972 Summer Olympics in Munich, is an extreme example of the pain being inflicted on many of Wall Street’s so-called macro traders. Many of those traders, who bet on global economic trends, including wagers that make money when markets fall, have been negatively affected by low interest rates and damped volatility across many of the markets in which they operate.

Wall Street Adapts to New Regulatory Regime (WSJ)
Four years after the Dodd-Frank financial law became reality, Washington’s regulatory machine is altering Wall Street in fundamental ways. Banks are selling off profitable business lines, pulling back from the short-term funding market, cutting ties with businesses that could attract extra regulatory scrutiny, and building up defenses to help weather future crises. While profits are up as firms slash costs and reduce funds set aside to cover future losses, their traditional profit engine—trading—is showing signs of weakening as banks step away from some activity amid regulatory pressure.

Fantex Completes Second Football Player I.P.O., Though Demand Is Slack (Dealbook)
Shares linked to the future income of [E.J. Manuel, a 24-year-old quarterback with the Buffalo Bills] Manuel started trading on Monday on an exchange operated by Fantex, a Silicon Valley start-up that helps athletes raise money through public offerings of stock. The firm previously sold shares linked to Vernon Davis of the San Francisco 49ers. The offering of 523,700 shares received a significant amount of support from Fantex itself. Unable to sell all of the Manuel stock to investors, the company stepped in to buy 250,000 shares, or 48 percent of the total amount offered, according to Buck French, the chief executive. This level of support was expected, Mr. French said. Despite the slack demand, the stock was trading higher in its debut on Monday. After opening for trading at $10 at noon, the shares were up 15 percent in early afternoon trading.

Fox’s Time Warner bid could hit $105 a share (NYP)
…according to Moody’s Investors Service, which in a report Monday laid out a scenario where Fox could offer $105 per share for Time Warner without jeopardizing its credit rating. That’s $20 more per share than Time Warner turned down from Rupert Murdoch’s company earlier this month. Moody’s scenario also boosts the deal’s cash component to $35.34 billion, up from $28.88 billion in Fox’s initial proposal. The beauty of Moody’s analysis, however, is Fox’s not having to break the bank to reel in Time Warner. In fact, the credit rating agency projected a Fox-Time Warner combo could return to Fox’s coveted leverage ratio — 3.0 times debt to Ebitda — inside of 18 months.

Soros Chart Shows Euro-Yen Reaching 2008 High (Bloomberg)
The euro will surge to a six-year high against the yen by the end of 2014 as the European Central Bank isn’t printing money as fast as the Bank of Japan, according to Daiwa Securities Co…Japanese traders and investors refer to this gauge as a “Soros Chart,” after billionaire investor George Soros correctly predicted in the 1990s that the yen would weaken because of Japan’s burgeoning money supply. Also tracked are the euro, which recently traded at 137 yen, up 46 percent since July 2012, and the slowing inflation rate in the 18 nations sharing the common currency.

Angry husband sends wife Excel spreadsheet detailing sex-starved month (NYDN)
A woman’s fed-up husband sent her an Excel spreadsheet listing every time she shot down his attempts to have sex over the past month, including her excuses, according to a Reddit post. The user throwwwwaway29 posted the doc to the site on Friday along with a plea for advice, Deadspin reported. “Yesterday morning, while in a taxi on the way to the airport, Husband sends a message to my work email which is connected to my phone,” the woman wrote. “I open it up, and it’s a sarcastic diatribe basically saying he won’t miss me for the 10 days I’m gone,” she said. The spurned hubby’s rundown showed the couple had only had sex three times since June 3, despite 27 tries on his part to get frisky. One column listed the wife’s apparent excuses, including protests that she felt “gross,” was too busy watching TV or ate too much. The successful rolls in the hay were marked with an italicized “Yes.” The beleaguered wife called the dry-spell “a temporary slow-down due to extenuating circumstances.” Read more »

Write-Offs: 07.21.14

$$$ Herbalife Tumbles After Ackman Vows to Reveal Enron-Like Fraud [Bloomberg]

$$$ Investors Don’t Like Dark Pools Anymore [BusinessWeek]

$$$ Renaissance Avoided More Than $6 Billion Tax, Report Says [Bloomberg]

$$$ J.P. Morgan Forms New Electronic-Trading Team [WSJ]

$$$ Man Suspected Of Stealing 200 Panties From Mall [AP] Read more »

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In court today, where he pleaded guilty, Frank Perkins Hixon Jr. laid out his thinking:

  • This wasn’t about avarice, it was about love
  • All he was trying to do was set up a nest egg for the woman with whom he had a two year affair, and their love child
  • But because his lady friend would not accept cash, he gave her the next best thing, the proceeds from trades based on material non-public information

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You’d think that having a million foreigners flying hither and thither about your enormous country, dumping their dollars and euros and whatever into all manner of kit, feijoada and caiparinhas, might offer a little pick-me-up to the Brazilian economy. You know, like how it helped swell a little non-profit called FIFA’s coffers by $2.36 billion. But you’d be wrong. Read more »

There will be none of that Chicago-Board-of-Trade-in-Ferris Bueller’s Day Off nonsense at the London Metals Exchange. Unless you feel like coughing up £1,250, that is. And don’t even think about doing it twice in three months, unless you’re looking for a couple of days off. Read more »

Hedge fund manager Bill Ackman has given many momentous presentations in his day: the unveiling of his Herbalife short, his highly emotional address of Target shareholders, and all matters of MBIA. But believe him when he says such things will absolutely pale in comparison to tomorrow’s event. Forget the thousands of hours he’s already spent publicly lambasting Herbalife’s business practices in the past. THIS is the one you REALLY have to listen to. It will be the final word on diet shakes. Read more »