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  • 13 Oct 2014 at 11:30 AM

Pay Hike Watch ’14: Jefferies

The junior mistmakers at the House ‘o Handler will not be left out of the fun. Read more »

Opening/Holiday Bell: 10.13.14

Putin Billionaire Allies Move Assets to Sons Amid U.S. Sanctions (Bloomberg)
Arkady Rotenberg, Putin’s boyhood friend and judo partner, divested his stake in OAO Mostotrest, Russia’s largest builder of roads and bridges, and his son Igor now holds 26 percent, according to company. He also transfered his stake in TPS Real Estate Holding, which builds shopping malls in Moscow and Sochi to Igor, according to his press office. The U.S. and European Union have targeted Russians in Putin’s inner circle, as part of rolling sanctions against individuals, companies and the financial, energy and defense industries, saying they seek to defend Ukraine’s territorial integrity amid a separatist insurgency in the east. “They are obviously seeking to bypass the potential impact of sanctions,” said Igor Bunin, head of Moscow-based Center for Political Technologies. “Going after his enemies, even Joseph Stalin admitted that children aren’t responsible for their parents. Let’s see how the West would address this.”

Mud runs as new way to entertain on Wall Street (NetNet)
Firms are looking for more creative ways beyond traditional dinners to entertain clients and prospective business partners. It’s now becoming about sweat, stamina and overcoming obstacles at activities such as spinning, CrossFit and even races like Tough Mudders. Stephanie Cadet, a sales rep at investment bank CLSA, has scheduled events for clients at SoulCycle, the boutique indoor cycling chain. She has another one coming up later this month. “There are definitely many more options now—especially in the past couple of years. They have sort of flourished,” Cadet said…After the classes, [Jay Galuzzo] sees many business partners and their clients discussing work in the facility’s common area which is stocked with fresh fruit and water. “You take a class and it’s an icebreaker with the client,” said Galuzzo, who doesn’t believe a hard, sweaty workout would be a turn-off to doing business.

Who does this Swiss banker have the goods on? Stay tuned (CNBC)
The highest-ranking Swiss banker ever to be captured by U.S. authorities goes on trial Tuesday in federal court in Florida on charges of helping wealthy Americans evade millions in taxes. Raoul Weil, 54, was indicted in 2008, but continued to live and work in Switzerland, which does not extradite its citizens in tax cases. He was declared a fugitive by the United States in 2009. It wasn’t until last year, when Weil made the mistake of traveling to Italy for a vacation with his wife, that authorities were able to catch him…His indictment was a watershed moment in the effort by the United States to pierce the veil of Swiss bank secrecy: The United States alleged UBS’ so-called “cross border” business had approximately 20,000 American clients with assets hidden from the IRS totaling as much as $20 billion. In 2009, UBS agreed to pay a $780 million fine and turn over the names of thousands of clients.

Ireland Considers Closing Corporate-Tax Loophole (WSJ)
Ireland is expected on Tuesday to announce changes to its tax code that could eventually close one of the world’s most famous corporate-tax loopholes, dubbed the Double Irish, after heavy pressure from governments and the European Union, tax experts say…The Double Irish uses a twist in Irish laws to funnel royalty payments for intellectual property from one Irish-registered subsidiary to another that resides for tax purposes in a country with no corporate income taxes. It is often paired with a related tax structure that planners call the “Dutch Sandwich,” which uses a Netherlands-based structure to avoid certain taxes. The Double Irish structure allows companies to legally shift billions of euros in profit to tax havens each year.

Deutsche Bank Legal Costs May Hit $8.8 Billion: Spiegel (Bloomberg)
Deutsche Bank’s provisions for potential legal costs could rise to as much as 7 billion euros ($8.8 billion), Spiegel reported, citing people close to Germany’s largest bank that it didn’t identify. That would be 30 percent more than what Deutsche Bank has accounted for so far. The Frankfurt-based lender said on July 29 second-quarter reserves for litigation expenses increased 450 million euros from the first quarter to 2.2 billion euros, while contingent liabilities rose to 3.2 billion euros to reflect potential costs from regulatory investigations. It said it couldn’t predict such costs for the rest of the year. The company’s legal costs, which totaled 3 billion euros last year, are hampering efforts to build capital and increase returns for investors. Deutsche Bank has yet to resolve probes into its role in industrywide attempts to manipulate benchmark interest rates and currency markets and faces lawsuits alleging it didn’t make adequate disclosure of U.S. mortgage-backed securities.

Man With Tom Brady Helmet Tattoo Arrested For Narcotics (HP)
Thompson, 46, was busted Sept. 10 for possession of Spice, the synthetic marijuana, according to The Smoking Gun. The suspect told police that he purchased the “Master Kush” Spice “from a black male for $15” at a downtown park. He also told the cops he did not know the drug was illegal in Florida, claiming it was still legal in his home state of New Hampshire, from where he had moved just three weeks prior. New Hampshire actually banned the sale of synthetic marijuana in 2012, according to Thompson was charged with felony drug possession and trespassing. He is being held at the Pinellas County jail in lieu of $1500 bond, the New York Daily News reports. The jailers took the extra step of taking four separate booking photos of Thompson so that his tattoos could be memorialized for possible future identification purposes. The tat includes Brady’s number, 12, an American flag and the NFL logo and even a small green dot to indicate a helmet that, if real, would have a headset allowing Brady to hear plays from his coaches. Thompson’s tattoo goes further: There’s a recreation of the Vince Lombardi Super Bowl trophy and ink-replicas of the signatures of Wes Welker, Rob Gronkowski and Randy Moss tattooed across the dome, reports. Thompson got the tattoo in January, 2008, after the Patriots finished the regular season undefeated. “It’s something that popped in my head,” he told WMUR TV at the time. “I was watching the game, and I said, ‘I want my head to look like Tom Brady’s helmet.’” Read more »

Write-Offs: 10.10.14

$$$ A Wells Fargo employee asked the CEO for a raise — and cc’d 200,000 coworkers [WaPo]

$$$ Pimco’s assets under management drop five percent in third quarter [Reuters]

$$$ SEC delays decision on SAC fund for burned investors [NYP]

$$$ On his second day of testimony in federal court, Mr. Bernanke maintained that officials sought to save AIG. “The company was on the brink of default, and our intervention would spare it the discipline of the market,” Mr. Bernanke said. [WSJ]

$$$ World’s Most Expensive Burger Is Only $1,768 [HP] Read more »

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Changing jobs can be very stressful. I’m not going to get into what I did before I won the coveted Dealbreaker Chef de Cuisine post, but let’s just say my julienning skills were more than a tad underutilized.

The first week on a new job is a brutal mishmash of emotions, whether you’re a line cook, a Chef de Cuisine, or yes, even a bond fund manager. (This is especially true when most of the money from you old gig doesn’t make the trip with you to your new one.) It takes a while to learn the rhythms of the new office, figure out whether your no-eye contact policy freaks people out, or whether insulting a colleague’s French accent will drive him into the Croque Monsieur business.

In terms of making new friends and finding his way in the new space, the fact that Bill Gross is working remotely from Malibu, and not at his new employer’s headquarters in Denver, puts him at a disadvantage. But it also offers him an opportunity. While I’m contractually barred from discussing my clients, let’s just hypothetically say Bill was one, and the two of us were sitting in his office in Newport Beach, right before hopping on the short flight to Colorado to meet some of his new colleagues, or he called me after landing, pleading for advice re: how to interact with people. The setting doesn’t matter, my advice to him would be the same: Give them a taste of Denver. Let them know you appreciate their home.

As a rookie, I’m not suggesting Bill whip up a few servings of Rocky Mountain oysters, the deep-fried testicles of bull calves that Coloradoans love so dearly. No, that could make for a bit of an awkward first impression.

When I tell Bill to “give them a taste of Denver,” I mean one thing: “Get yourself an apron and a chef’s hat and set up a Denver omelette station. Set it up IMMEDIATELY.” Read more »

Darden Board Gets What Was Coming To Them

So, the people who were Darden Restaurants directors yesterday are no longer Darden directors today, what with every single one of them having been handed a much-deserved ass-kicking by hedge fund Starboard Value. The activist hedge fund correctly predicted that boards which (a) produced an ill-conceived plan to sell one thing for a song to stave off a couple of activist hedge funds and then (b) refuse to allow shareholders to vote on that plan even though most of them make very clear they’d like to are rather vulnerable when it comes to annual meeting time, which time was today. And while you can prevent shareholders from voting on ill-conceived sales, it is likely to incline them against you when you cannot keep them from voting, at annual meetings, say. Read more »

The thrill of the IPO, it seems, goes only so far. Read more »

Naturally, the details of this event lead his latest (and inaugural at Janus) Investment Outlook. Read more »

As its name indicates, Deutsche Bank is not a Swiss bank. But it does have a Swiss banking unit, for the same reason every other bank has a subsidiary in a country home to fewer people than New York City, which is the reason why said country of eight million people living on top of mountains has exactly one notable industry: banking. Historically speaking, the kind of banking that means you might not have to pay taxes.

Of course, this sort of banking has run into some troubles, recently, not least of all from Deutsche Bank’s home country. And without Angela Merkel’s willingness to throw down á la François Hollande with Barack Obama, and frankly without much risk to itself, the Frankfurters aren’t putting up a fight. Read more »