Opening Bell: 11.11.08

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UBS Execs Could See Jail Time (NYT)
UBS, after advising top tier clients on how to funnel money into offshore accounts so as to restructure their holdings and minimize their tax burden, have turned their clients over to the Justice Department and IRS for possible tax fraud. I can only see this as weak and thus believe they should spend time in the pokey.
Grow a pair.
AMEX Approved As Bank Holding Company (CNBC)
As you probably heard, American Express's recent woes have led them to file for Bank Holding Company status, under which they'll qualify for TARP money and can issue debt to cover defaulting credit card customers and a rising cost structure.
Fannie Posts 3Q Loss (CNNMoney)
"Troubled mortgage-finance giant Fannie Mae reported on Monday that it lost $29 billion in the most recent quarter, putting the firm closer to having to draw on the $100 billion in taxpayer dollars committed to it in September"
I was under the impression that Fannie Mae was already under the hammer and sickle of sweet mother America?
If you're going to federalize the Mae's, at least turn them into Sovereign Wealth Funds (or one fund, your choice), take a hands off approach, and let it make some money for you. Who knows, you might just be able to save Social Security with the earnings (you'll fuck this up too, I have faith).
Super Bowl Commercials In Trouble, Need Government Assistance (WSJ)
I don't know what people did before awesome Super Bowl commercials, but I can only imagine a world of drab, boring people talking about nothing but football for 4 hours. I love football, don't get me wrong. But venture into the den of some 5 guys sitting around watching the game on any given Sunday and you'll hear, well, next to nothing, except for the occasional statistic and maybe a comment about how we'd bang a cheerleader here or there; nothing of real merit. We like it that way: a void of all intelligence and open permission to drink as much as we want -- that's all in we're looking for out of life for 4 sweet, sweet hours. Oh, and maybe Hot Wings.
The Super Bowl is supposed to be better though: it has hot girls all the time (not just cheerleaders) and dancers, and fireworks, and Commercials. And while we'll forget the Girls' face/body/everything about ten minutes after she's off screen, the better commercials get quoted for the better part of the year, and that's what matters, America.
Don't let the terrorists/mortgage brokers/real estate agents win: Keep the ads.


This Had Me Terrified, But It's Okay: The Radiation Only Hides In The Keg, It Doesn't Live There. (Bloomberg)
It turns out scrap metal radioactivity is a huge problem, but we don't really give a shit. What was worrisome about this was the headline intimating that Radiation was infiltrating our Beer Supply (Bs), which isn't true, but rather a crude marketing scheme by Bloomberg that possibly scared thousands and may have led to at least one suicide.
O Cubed Eyeing Next Purchase (Reuters)
The Majestic himself is eyeing another possible acquisition, this time in Belgian-French Bank Dexia.
"De Tijd said insurers Berkshire Hathaway Assurance and Assured Guaranty were particularly interested in the "healthy" part of FSA -- guaranteeing municipal bonds -- but there were also talks about its riskier activities."
China's Trade Surplus Hits New Record (BBC)
"China's trade surplus rose to $35.2bn (£22.48bn) in October, hitting a record for a third month in a row, data shows."
Regardless, the data released would suggest that China has a waning economy, to the point of economic growth slowing to 9% over the term of the recession. If this is true, it likely means absolutely nothing for American consumers, but my have in impact on our placing Treasuries.
Markets Down Overnight (Bloomberg)
Money shots:
"More than $28 trillion has been erased from the value of global equity markets as credit losses and writedowns topped $920 billion" (since the start of the downturn)
"Futures on the Standard & Poor's 500 Index slid 0.9 percent. Europe's Dow Jones Stoxx 600 Index declined 2.2 percent."... "The MSCI Asia Pacific Index dropped 3.5 percent as Australian business confidence fell to a record low."
"Profits for the 428 companies in the S&P 500 that have reported, including Boeing Co. and AT&T Inc., have shrunk 17 percent, while missing predictions by 4.7 percent."
"Growth in the U.S. economy will slow to 1.1 percent next year, down from 1.6 percent predicted for 2008"
"The International Energy Agency may cut its 2009 oil demand forecast for a third month."
--William Richards

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Opening Bell: 02.11.13

Two Firms, One Trail, In Probe Of Ratings (WSJ) The Justice Department last week went after Standard & Poor's Ratings Services—not rival Moody's Investors Service —with a $5 billion fraud lawsuit. Some former Moody's employees think they know why. The Moody's Corp. unit took careful steps to avoid creating a trove of potentially embarrassing employee messages like those that came back to haunt S&P in the U.S.'s lawsuit, the former employees say. Moody's analysts in recent years had limited access to instant-message programs and were directed by executives to discuss sensitive matters face to face, according to former employees. The crackdown on communications came after a 2005 investigation by then New York Attorney General Eliot Spitzer into Moody's ratings on some mortgage-backed deals, the former employees say. Former employees also point to an April 2001 settlement between Moody's and the Justice Department's antitrust division over the destruction of documents amid a civil inquiry by the agency. Moody's pleaded to one count of obstruction of justice and paid a fine of $195,000. Moody's called that situation "an isolated incident" and said it cooperated with the Justice Department's investigation. That settlement helped lay the groundwork for heightened concerns about sensitive documents, former Moody's employees say. Credit Rating Victims Didn’t Know S&P’s Toxic AAA Born of Greed (Bloomberg) When Charles O. Prince III was chief executive officer of Citigroup Inc. from 2003 to 2007, he didn’t know about a surge in mortgage risk that his own investment bankers loaded on to its bank’s books. Because such debt carried top credit ratings from firms such as Standard & Poor’s, few financial executives paid attention to the potential dangers. When Charles O. Prince III was chief executive officer of Citigroup Inc. from 2003 to 2007, he didn’t know about a surge in mortgage risk that his own investment bankers loaded on to its bank’s books. Because such debt carried top credit ratings from firms such as Standard & Poor’s, few financial executives paid attention to the potential dangers. Makeover At Barclays Won't Be Extreme (WSJ) Mr. Jenkins's cuts are likely to be focused on areas where Barclays lags far behind competitors, executives say. That could include parts of the equities sales-and-trading businesses in Asia and continental Europe, according to analysts and people at other banks. Those are businesses in which Mr. Diamond spearheaded an ambitious expansion but where Barclays remains a second-tier player. But other changes are driven more by polishing the bank's tarnished image than they are by the need to boost profits. A few business lines that don't seem "socially useful" are likely to end up on the chopping block, executives say. For example, Barclays plans to retreat at least in part from the lucrative trading of "soft commodities" such as coffee, executives say. That is a concession to mounting criticism that speculative trading in those commodities contributes to food-price inflation. "We're a big player, but does it pass the smell test of what society would think of this?" a senior executive said. Mr. Jenkins is also expected to trumpet plans to dramaticallyscale back Barclays's tax-planning business, in which it advises clients on how to minimize their tax burdens. The bank will no longer help clients put together transactions that have no businesspurpose other than reducing taxes. "Such activity is incompatible with our purpose," Mr. Jenkins will say on Tuesday, according to the extract of his speech. But the bank isn't expected to exit the business altogether. It will continue to offer tax-minimizing advice. People familiar with the matter say the business has been hiring employees recently. Putin Turns Black Gold Into Bullion as Russia Out-Buys World (Bloomberg) Not only has Putin made Russia the world’s largest oil producer, he’s also made it the biggest gold buyer. His central bank has added 570 metric tons of the metal in the past decade, a quarter more than runner-up China, according to IMF data compiled by Bloomberg. The added gold is also almost triple the weight of the Statue of Liberty. White House Warns Coming Austerity Will Hit Economy Hard (Reuters) Automatic government spending cuts due to go into effect March 1 unless Congress acts to prevent them would bite deeply into programs affecting many Americans, such as law enforcement, small business assistance, food safety and tax collection, the White House said on Friday. The administration urged Congress to blunt the effect of the reductions, which the White House said would slash non-defense programs by 9 percent across the board and defense programs by 13 percent, the White House said. "These large and arbitrary cuts will have severe impacts across the government," the administration said in a statement. World's most prolific stripper calls it a day (DM) For two decades, the Liverpudlian father-of-three has been the Usain Bolt of the naked dash. In 1995, he leapt naked on to Fred Talbot’s weather map on daytime TV show This Morning, and a year later he appeared nude on the green during the Open at Royal Lytham. Then, in 2004, he was fined £550 for trespassing after streaking across the pitch at the Super Bowl in Texas – a match watched by 130 million people in 87 countries. For good measure, Mark has also stripped off at Wembley, Wimbledon and Ascot. ‘There’s no major venue or event I haven’t done,’ he says proudly. ‘But I’m nearly 49 now and my children have begged me to stop. It’s time. I’m not ready for my slippers just yet, but gravity’s against me.’ Treasury Pick Lew Faces Grilling on Citi Bonus, Cayman Account (Reuters) Jack Lew, President Barack Obama's pick to be U.S. treasury secretary, is expected to come under fire for the administration's budget policies and a nearly $1 million bonus he received from bailed-out bank Citigroup when he testifies on Wednesday before a Senate panel vetting him for the job. The hearing will briefly become ground zero in the pitched political battle over the federal budget, with Republicans set to attack over what they contend is Lew's devil-may-care attitude to reducing the U.S. budget deficit. "He'll be used as a political ping-pong ball," said Ted Truman, a senior fellow at the Peterson Institute for InternationalEconomics who served briefly as an adviser to Obama's former treasury secretary, Timothy Geithner. Treasury Eases Off On Bank Rules (WSJ) The proposal, which will be subject to comment before becoming a final rule, is likely to insist that financial institutions gather beneficial ownership information—who is in charge and who profits—on new corporate accounts, officials said. But in a move that could assuage some industry concerns, financial institutions wouldn't have to vet that ownership data for accuracy. Instead, they would rely on the customer to vouch for the information. With a Focus on Its Future, Financial Times Turns 125 (NYT) On Wednesday, The F.T. is celebrating its 125th birthday. The newspaper’s London headquarters along the south bank of the Thames will be lit up in pink, the color of the paper on which it has been printed since shortly after it was founded. There will be a few parties — understated, of course, for these are straitened times in the City of London, and challenging ones for the newspaper industry. Waxing Our Way To The ER (Salon) A new study from the University of California-San Diego reveals that “Emergency room visits due to pubic hair grooming mishaps,” including “lacerations,” increased fivefold between 2002 and 2010, sending an impressive 11,704 pube-scapers to the E.R. The culprits? Scissors and hot wax did some of the damage, but plain-old non-electric-razors accounted for the lion’s share, at 83 percent...The study also revealed that below-the-belt grooming isn’t just for adult ladies anymore – men accounted for 43.3 percent of the injuries, and almost 30 percent of them were girls under the age of 18. To avoid becoming yet another harrowing grooming gone bad statistic, the researchers advise hair removal aficionados to “Pay attention to where you’re placing that razor. Invest in a non-slip bath mat. And don’t shave while under the influence of drugs or alcohol.”