Opening Bell: 07.21.10 - Dealbreaker

Opening Bell: 07.21.10

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Morgan Stanley Swings To Second Quarter Profit
(MarketWatch)
The bank said earnings for the quarter came in at $1.58 billion, or $1.09 a share, compared to a loss of $1.26 billion, or $1.10 a share, in the year-ago period. On an adjusted basis, profit in the latest quarter was $1.44 billion, or 80 cents a share. Quarterly net revenue at Morgan Stanley rose to $7.95 billion, up 53% from a year earlier.

Wells Fargo Earnings Rise 12% (WSJ)
The company reported a profit of $2.88 billion, or 55 cents a share, compared with $2.58 billion, or 57 cents a share, a year earlier. Shares outstanding rose 17%. Revenue declined 5% to $21.39 billion.

Tiger Management Sowing Seeds Of Growth (WSJ)
Julian Robertson is considering reopening Tiger, a launching pad for young money managers, to the outside world. Mr. Robertson has beefed up Tiger's management ranks as part of a potential expansion that could involve creating a "seeding" fund or a fund of hedge funds for outside investors. In a seeding fund, Tiger would allow outside clients to come in alongside Mr. Robertson and his team to help fund new or early-stage hedge-fund managers in exchange for a slice of their business. A more-common fund of funds would collect outside investors' money and dole it out to Tiger-seeded managers, who would in turn invest it. This month, Mr. Robertson hired a former Goldman Sachs Group Inc. executive, John L. Townsend III, as operations chief, and promoted the youngest of his three sons, Alex Robertson, to managing partner.

Mafia Money-Laundering Profits Swell in Credit Crisis (Bloomberg)
“The crisis has given organized crime room to thrive because access to credit has become more difficult,” said Anna Maria Tarantola, the central bank’s deputy general director, in a July 12 interview in her Rome office. “Whoever holds large amounts of cash, like crime groups, can make investments that aren’t possible for others. They can now invest in fully legal businesses.” Organized crime groups boosted their revenue by 4 percent to 135 billion euros ($174.6 billion) last year, according to estimates from Rome-based anti-racketeering group SOS Impresa.

Editorial: Goldman's Go-Round (NYT)
Morning laughs: "It seems clear that one of the reasons Goldman settled was to end questions about its practices. If the S.E.C. keeps up its new investigative and enforcement rigor, that might not be so easy to do."

Australia A Problem Child For Investors Due To Tax (Reuters)
"Australia is one of a few Asian countries that are now considered problem children for foreign investors," because of the uncertainty over the tax regime, said Mark O'Reilly, a senior partner at PriceWaterhouse Coopers, who advises buyout firms on tax issues. "Private equity managers looking to invest funds in Australia are in a bit of a state of limbo in relation to what is an appropriate structure and tax outcome," he said.

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