Fed Officials on Track to Raise Short-Term Rates Later in the Year (WSJ)
Federal Reserve officials are staying on track to start raising short-term interest rates later this year, even though long-term rates are going in the other direction amid new investor worries about weak global growth, falling oil prices and slowing consumer price inflation. The Fed’s stance, as it prepares for a policy meeting later this month, is striking because European Central Bank officials are poised to take the opposite approach later this week.
Jefferies Reprises Role of Market White Knight (WSJ)
When foreign-exchange broker FXCM Inc. FXCM -15.06% was forced to seek a rescue last week following a surprise surge in the Swiss franc, a number of potential white knights surfaced, including private-equity firms and Leucadia National Corp. It soon became apparent, however, that the best-suited among them to pull off the lightning-fast cash infusion FXCM needed was Leucadia and its Jefferies Group LLC unit, which in recent years has honed its skills as a rescuer of firms succumbing to bouts of market turmoil. Jefferies bankers in about 36 hours put together a $300 million financing from its parent company that will keep FXCM in business. In addition to the 10% initial annual interest the loan commands, Leucadia stands to reap an outsize share of any dividends FXCM generates and of proceeds from any sale of the company or its parts. Jefferies’s role in bailing out FXCM is reminiscent of one it played in 2012, when Knight Capital Group Inc. needed an emergency infusion to stay afloat after a slew of accidental stock orders put the trading firm on the verge of collapse.
Wall Street titan’s son thrown out of NYC steakhouse (NYP)
The son of Wall Street titan Mario Gabelli caused a scene at hot new restaurant Hunt & Fish Club, bellowing “Do you know who my father is?” as Fox Business’ Charlie Gasparino tried to calm him down. Michael Gabelli was thrown out of the Midtown steakhouse after he started yelling when the bill arrived. A witness said, “He forcefully argued with the servers and managers. Gasparino tried to help. Charlie kept saying things like, ‘You’re embarrassing your father.’” After Gabelli calmed down, he tried to get a drink, but when the bartender refused to serve him, he flipped out. So he was thrown out, but not before dropping, “Don’t you know who my father is?…He runs this city.”
Swiss Franc Trade Is Said to Wipe Out Everest’s Main Fund (Bloomberg)
Marko Dimitrijevic made a smart bet in December. The hedge fund manager, wagering the Swiss franc would fall, profited after voters there rejected a plan to have the central bank hold a fifth of its assets in gold. For the $830 million Everest Capital Global, his Miami-based firm’s oldest and biggest fund, investments from Switzerland contributed 0.6 percentage points to gains that month. Last week, the wager had a far bigger impact. In less than a day, it wiped out the 24-year-old fund, according to a person familiar with Everest Capital, leaving the firm with about $2.2 billion in seven other funds. Dimitrijevic, an emerging market specialist who’s navigated at least five debt crises in those markets, was undone by the central bank of the country where he was raised. Last week, the Swiss National Bank unexpectedly let the franc trade freely against the euro, ending its three-year policy of capping the franc at 1.20 a euro.
Gleeful German Firms Target Switzerland on Franc’s Gains (Bloomberg)
“The first thought to cross my mind was that this would be great for me and my company’s deliveries in Switzerland,” Hartmut Neidlein said as he recalled hearing about the Jan. 15 decision. “It’s now cheaper for them to buy our products and that could increase demand.” Wurotec is one of the thousands of small and medium-sized companies that make up the German Mittelstand, which account for more than half of the country’s gross domestic product. Neidlein has now set up a meeting with his Swiss distributor to try to boost sales of his machines, which start at 2,000 euros ($2,320), beyond the current 10 percent of the total.
Woman steals flat screen between her legs (WTSP)
Captured on video, a woman shocked workers by stealing a flat screen TV by stuffing it up her dress, between her legs. The woman simply walked into the store, picked up the packaged TV, placed it between her legs and walked out along with an accomplice. According to reports, it all happened in 13 seconds. “She did it so quickly no one had time to notice or react,” said the shop assistant. Read more »