Opening Bell: 02.07.11

Author:
Updated:
Original:

Whitney Whips Up Wall Street As Bear In Heels (Bloomberg)
"Many of Whitney’s critics have a vested interest in tearing her down. They include competing municipal bond analysts, fund managers who run muni portfolios, financial advisers who sell the tax-exempt securities, and above all, the borrowers who depend on munis to finance their whopping deficits. To all of them she is a big-mouthed, larger-than-life nightmare...If she were demure and understated instead of a brassy hustler who markets herself on television with stunning success, fewer people might be hoping for Whitney’s fall. But she’s willing to break a sweat to boost her business and sell herself as a brand."

Lloyd Blankein Didn't Care To Speak With Charlie Gasparino Last Night (Twitter)
"I just made eye contact with Lloyd Blankfein, Goldman Sachs CEO at a pre-Super Bowl party in Dallas, he saw me and walked the other way."

Stock-Hedging Lets Bankers Skirt Efforts to Overhaul Pay (Dealbook)
In some cases, executives saved millions of dollars by using these tactics. One prominent Goldman investment banker avoided more than $7 million in losses over a four-month period. Such transactions are at the center of a debate over whether Wall Street executives should be allowed to hedge their stock holdings. The concern with hedging is that executives can easily break the ties between compensation and company performance. Employees who hedge their holdings are less concerned about a falling share price.

Risky Assets Still Lurk At Banks (WSJ)
In part due to those bad assets, the top 10 U.S.-owned banks had $13.8 billion in "unrealized losses" that have lasted at least a year in their investment portfolios as of Sept. 30, according to a Wall Street Journal analysis. Such losses are baked into banks' book value, but don't get counted against earnings as long as the banks believe the investments will later rebound. If those losses were assessed against earnings, it would have reduced the banks' pretax income for the first nine months of 2010 by 21%, according to the Journal analysis.

Aguilera apologizes for Super Bowl fumble (ABC)
The singer has apologized for the incident, releasing a statement which reads: "I got so caught up in the moment of the song that I lost my place. I can only hope that everyone could feel my love for this country and that the true spirit of its anthem still came through."

Gruebel's Rebuilt UBS Trails Credit Suisse in Money From Rich (Bloomberg)
The challenge now: Generate fatter profits from the $1.7 trillion UBS oversees for wealthy clients while elbowing aside Credit Suisse Group AG, which raked in more assets than any Swiss bank since the financial crisis began. As both face an erosion of profitability from an assault on banking secrecy, UBS has to fight that much harder to attract rich clients, who removed 251.6 billion francs in the nine quarters through June.

SEC officials who missed Madoff now in top spots at major law firms (NYP)
At the top of the class of ex-SEC enforcement officials who clawed up the career ladder despite zero-oversight in the Madoff scam is Linda Thomsen, a 14-year veteran at the agency and director of enforcement for three years when the colossal Ponzi scheme burst into the headlines in 2008. She is now a partner at the international law firm Davis Polk & Wardwell, where Grover Cleveland worked between his two terms as president.Also graduating to better jobs and fatter paychecks are three former deputy directors of enforcement: Peter Bresnan, now at Simpson Thacher & Bartlett; George Curtis, now at Gibson Dunn & Crutcher; and Walter Ricciardi, now at Paul Weiss Rifkind Wharton & Garrison. Two former directors of the SEC's New York regional office also moved up and out: Mark Schonfeld, also at Gibson Dunn & Crutcher; and Wayne Carlin, now at Wachtell Lipton Rosen & Katz. When they worked at the SEC, each was earning about $200,000 to $225,000. In their new gigs, they pull down $2 million a year or more, according to Peter Zeughauser, a California-based consultant who tracks attorney salaries.

A Crisis of Faith in Britain’s Central Banker (NYT)
A central banker need not be loved, but at the least he should command respect — and in Britain these days Mervyn King cannot count on either.

Google Executive Key Figure In Egypt Revolt (WSJ)
Mr. Ghonim, a father of two who is in his 30s, emerged as a central symbol of the antigovernment protests, cast as the face of a movement and hero in the cause of democracy. Protest organizers in Cairo's central Tahrir Square adopted him as a symbolic leader. Suspecting his arrest—but having no proof—they declared in speeches that they wouldn't leave the square until he was freed. Marchers carried homemade signs emblazoned with his name. At the same time, some local media suggested the political activities of Mr. Ghonim, who is Google's head of marketing for the Middle East and North Africa, make him a traitor to his nation.

A-Rod Eats Popcorn In The Most A-Rod Way Possible (Deadspin)
Without dirtying his hands.

Related

Opening Bell: 04.03.12

CFTC Deals Out Royal Pain (WSJ) In a federal-court lawsuit filed Monday in New York, the Commodity Futures Trading Commission alleged a "wash trading scheme of massive proportion" by RBC, Canada's largest bank. From 2007 to 2010, officials at RBC coordinated with two subsidiaries on the purchase and sale of futures contracts that gave the right to sell stock later at certain prices, the CFTC alleged. The alleged scheme eliminated the possibility that RBC would suffer any losses on the investments, while locking in "lucrative" Canadian tax breaks on dividend payments, according to the lawsuit. U.S. Economy Enters Sweet Spot as China Slows (Bloomberg) An improving job market, rising stock prices and easier credit are combining to lift U.S. consumer confidence and spending, with optimism measured by the Bloomberg Comfort Index near a four-year high. Personal-consumption expenditures increased by the most in seven months in February, rising 0.8 percent, the Commerce Department said last week. “We’re entering a sweet spot for the economy,” said Allen Sinai, president of Decision Economics Inc. in New York. “We’re in a self-reinforcing cycle,” where faster employment growth leads to higher household income and increased consumer spending. China's Central Banker Sees Risk of Global Recession (WSJ) China's central bank Gov. Zhou Xiaochuan warned that the global economy hasn't yet escaped the financial crisis, while cautioning the U.S. to take "more responsibility" for its monetary easing. There are "new elements that could bring the global economy back into recession," the central bank chief said in a panel discussion Tuesday at the Boao Forum in the southern island province of Hainan, without elaborating on what the elements are. ‘Apple Fever’ to Push Stock to $1,001, Topeka Capital Says (Bloomberg) Apple, already the world’s most valuable company, will see its stock price reach $1,001 within 12 months, lifted by growth in China and the debut of a new television product, according to Topeka Capital Markets. The new target, issued yesterday by Topeka’s Brian White, is the highest among the 45 analysts tracked by Bloomberg and represents a 62 percent increase over the current price. The gains will be fueled by demand for the next iPhone, in addition to the expansion into China and the TV market, he said. SEC Probes Groupon (WSJ) The regulator's probe into the popular online-coupon company is at a preliminary stage and the SEC hasn't yet decided whether to launch a formal investigation into the matter, the person said. The SEC decision to examine the circumstances surrounding Groupon's surprise revision is the start-up's latest run-in with the regulator. Groupon twice revised its finances before its November IPO. An SEC spokesperson declined to comment, as did a spokesman for Groupon. JOBS Act Jeopardizes Safety Net for Investors (Dealbook) Andrew Ross Sorkin: "Maybe President Obama should have bought shares in Groupon’s I.P.O. If he had, he would understand what some Groupon investors may be feeling as he prepares this week to sign a new piece of legislation to help start-ups get financing. Had he purchased $10,000 worth of shares on the open market on the first day of public trading for Groupon, the online coupon company based in his hometown Chicago, he would have lost a good chunk of his investment, putting him in the red by almost $4,100 today. That means he would have lost about 41 percent of his investment in Groupon in just five months, while the Nasdaq rose some 16 percent." James Cameron Changes Stars In Titanic (CM) The director unveiled a 3D version of his multi-Oscar winning classic last month (Mar12) and he resisted the temptation to use its reworking as an excuse to cut scenes he's no longer happy with. But there was one shot Cameron felt obliged to alter, because a top stargazer informed him the astral pattern onscreen was incorrect for the night the liner sank in 1912. The scene involves Kate Winslet's character, Rose DeWitt Bukater, drifting on a piece of wood and gazing at the night sky as the disaster unfolds. Cameron tells British magazine Culture, "Oh, there is one shot that I fixed. It's because Neil deGrasse Tyson, who is one of the U.S.' leading astronomers, sent me quite a snarky email saying that, at that time of year, in that position in the Atlantic in 1912, when Rose is lying on the piece of driftwood and staring up at the stars, that is not the star field she would have seen, and with my reputation as a perfectionist, I should have known that and I should have put the right star field in. "So I said, 'All right, you son of a bitch, send me the right stars for the exact time, 4.20am on April 15, 1912, and I'll put it in the movie.' So that's the one shot that has been changed." JPMorgan’s Hannam Resigns After Market Abuse Fine (Reuters) JPMorgan Chase’s Ian Hannam, one of its most senior London-based bankers, has decided to resign after being fined by Britain's financial watchdog for market abuse, according to an internal memo the bank sent to staff. In a separate statement, Hannam said he would appeal the 450,000 pounds ($720,700) fine by the FSA. Judge OKs MF sale (Dow Jones) A judge approved a Jefferies Group affiliate’s purchase of MF Global Holdings Ltd.’s liquidating brokerage’s remaining gold, silver and other precious-metal assets. Judge Martin Glenn of the US Bankruptcy Court in Manhattan approved the sale, but much of yesterday’s time was taken up by issues regarding insurance meant to pay for former MF Global executives’ legal defenses. Jefferies is buying the remaining 106 warehouse certificates — not the actual gold and silver bars — of MF Global’s former commodities customers. Ann Romney Says Campaign Will ‘Unzip’ the Real Mitt (The Note) Ann Romney defended her husband’s sense of humor today during a radio interview, explaining that if people think the candidate seems too stiff at times as the host suggested, she thinks “we better unzip him and let the real Mitt Romney out.”