Opening Bell: 12.19.11

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European Ministers Seek $261 Billion In IMF Crisis Funds (Bloomberg)
Euro-area finance ministers will hold a conference call at 3:30 p.m. Brussels time to discuss 200 billion euros ($261 billion) in additional funding through the International Monetary Fund and the mechanics of a so-called fiscal compact that was negotiated at a Dec. 9 European Union summit, according to two people familiar with the planning. “They’ll try to get as much done as they can before Christmas, but it’s doubtful they’ll put markets in a Christmas mood,” Carsten Brzeski, an economist at ING Group in Brussels, said in an interview. “There is still so much uncertainty.”

North Korean Leader Kim Jong Il Is Dead (WSJ)
Mr. Kim died on Saturday of a heart attack while on a train, North Korea's state media said. A television news announcer, dressed in black and her voice quivering with emotion, said Monday the nation would unite behind Kim Jong Il's third son, Kim Jong Eun, as North Korea's new leader.

ECB President Draghi Warns on Euro Zone Break-Up (FT)
In his first interview since becoming ECB president on November 1, Mr Draghi said struggling eurozone countries that quit the currency bloc would face still greater economic pain. For remaining members, European Union law would have been broken and “you never know how it ends really,” he said. Countries that left and devalued their currency would create “a big inflation” and fail to escape from structural reforms that would still have to be implemented “but in a much weaker position,” Mr Draghi told the Financial Times.

Prince Alwaleed Invests $300M in Twitter (Bloomberg)
Alwaleed, ranked the richest Arab businessman this year by Arabian Business magazine, and his investment company agreed to buy a “strategic stake,” Kingdom Holding said today. Alwaleed is the largest individual investor in Citigroup Inc. (C) and his other investments include holdings in Apple Inc. and General Motors Co. Riyadh-based Kingdom Holding jumped as much as 8.9 percent on the local exchange.

RBS Considering Closure Of Equities Business (Bloomberg, earlier)
Shutting or selling the division, including U.K. stockbroker Hoare Govett, are among the options being considered by the bank’s board, though no final decision has been made yet, said the people, who declined to be identified because the discussions aren’t complete. An announcement is expected by the time the bank reports full-year earnings at the end of February, the people said. The equities unit employs about 1,000 people.

'Occupy' guys, including bishop, arrested in new anniversary protest (NYP)
Cops busted at least 35 protesters yesterday after they broke into a private park in Manhattan to mark the three-month anniversary of Occupy Wall Street. The marchers also shattered the window of a Starbucks on the corner of Varick and Spring Streets with a brick as they marched uptown...Among those arrested were Bishop George Packard, a former chaplain for the armed services and decorated Vietnam veteran who has acted as the liaison in negotiations between Trinity Church and protesters as the movement had sought permission to use the church owned property as a new base of operations.

S&P Cut Proves Absurd as Investors Prefer U.S. (Bloomberg)
Four months after Standard & Poor’s stripped the U.S. of its AAA credit rating and said the world’s biggest economy was no longer the safest of borrowers, dollar- denominated financial assets are doing nothing but appreciating. Government bonds have returned 4.4 percent, the dollar has gained 8.6 percent relative to a basket of currencies, and the S&P 500 Index of stocks has rallied 1.7 percent since the U.S. was cut to AA+ from AAA on Aug. 5. The cost for the nation to borrow has fallen to record lows since S&P said the U.S. was no longer risk-free, with the average monthly yield in November on 10-year notes below 2 percent for the first time since 1950.

Strategist: Economy 'Hostage' To Politicians In 2012 (CNBC)
The year ahead will see slow global economic growth combined with political uncertainty to create to a similar outlook for stock markets to 2011 with a significant chance of continued stock market volatility, according to a research note published by HSBC’s global head of equity strategy, Gary Evans. Evans said uncertainty over the euro zone would persist well into next year and that it would ultimately only come to an end when Germany was forced to change its policy over euro bonds and European Central Bank asset purchases, most likely by a political or economic crisis.

House Balks At Payroll Tax Deal (WSJ)
House Speaker John Boehner flatly ruled out approval of a Senate agreement to temporarily extend the payroll tax cut through February, leaving uncertain both the tax cut and other year-end business as Congress struggled to finish its work for 2011. Mr. Boehner said Sunday on NBC's "Meet the Press" that a two-month extension was a sign of congressional dysfunction. "How can you do tax policy for two months?" Mr. Boehner said. "We really do believe it's time for the Senate to work with the House to complete our business for the year. We've got two weeks to get this done."

Voters To Read Recovery Signs (WSJ)
After more than two years of frustrating fits and starts, the U.S. economy shows modest signs of picking up, raising the question of whether such improvements could be lasting or significant enough to affect the 2012 campaign debate. The number of Americans filing claims for unemployment benefits has dropped, consumer spending has shown signs of resilience, and analysts estimate the economy's output in the fourth quarter is growing at its fastest pace since early 2010. On Friday, there was another dash of good economic news. The Labor Department said consumer prices, after surging earlier this year, were unchanged in November, a sign that inflation could be moderating. Car and energy prices dropped. The consumer price index was up 3.4% from a year earlier, down from an inflation rate of 3.5% in October and 3.9% in September. Those improvements are small and tentative, and there are plenty of reasons to think the growth pickup won't last. In any case, the economic situation is crucial for shaping the presidential campaign and President Barack Obama's hopes for re-election, because, though Election Day is 11 months off, history suggests it takes many months for voters' views of the economy to change.

Buyout Profits Keep Flowing to Romney (NYT)
An examination of Mr. Romney’s public financial disclosures, as well as interviews with former Bain partners, business associates and counselors to his campaign, reveals the extent of his financial relationship with Bain Capital and how it has allowed him to continue amassing a personal fortune while building a political career. Though Mr. Romney left Bain in early 1999, he received a share of the corporate buyout and investment profits enjoyed by partners from all Bain deals through February 2009: four global buyout funds and 18 other funds, more than twice as many over all as Mr. Romney had a share of the year he left. He was also given the right to invest his own money alongside his former partners. Because some of the funds and deals covered by Mr. Romney’s agreement will not fully wind down for several years, Mr. Romney is still entitled to a share of some of Bain’s profits. During his political career, Mr. Romney has promoted his experience as a businessman while deflecting criticism of layoffs caused by private equity deals by noting that he left Bain in 1999. But records and interviews show that in the years since, he has benefited from at least a few Bain deals that resulted in upheaval for companies, workers and communities.

Professor claims NYU fired him after he gave James Franco a 'D' (NYP)
James Franco’s tired James Dean act got an NYU professor booted from the school last year — after the teacher dared to give the overhyped Hollywood hunk a “D” for blowing off class, a lawsuit charges. José Angel Santana said he slapped the “127 Hours’’ star with the bad grade because he missed 12 of his 14 “Directing the Actor II” classes while pursuing a master’s in fine arts. Santana said he then suffered all kinds of drama — first from Franco, who publicly ridiculed him, then from his department, which axed him over the “D.” “The school has bent over backwards to create a Franco-friendly environment, that’s for sure,” Santana, 58, told The Post. “The university has done everything in its power to curry favor with James Franco.”

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Opening Bell: 11.02.12

Economy Adds 171,000 Jobs (WSJ) U.S. payrolls increased by a seasonally adjusted 171,000 jobs last month, the Labor Department said Friday. The politically important unemployment rate, obtained by a separate survey of U.S. households, rose one-tenth of a percentage point to 7.9%. Economists surveyed by Dow Jones Newswires expected a gain of 125,000 in payrolls and a 7.9% jobless rate. Hedge Fund Cashes In On Greek Bonds (Reuters) London-based hedge fund Adelante Asset Management has made a 70 percent gain on a sale of Greek bonds, showing the potential for big profits from betting on a recovery in the fortunes of a country effectively off-limits to investors a few months ago...Since the restructuring, Greek government bond prices have strengthened, allowing Adelante to sell them for around 24 cents on the euro, having bought them for around 14 cents in June, the company said. A Greek government bond maturing in 2042, for example, is currently trading at around 20.8 cents on the euro, Thomson Reuters data shows. Other hedge funds have made similar bets. Third Point, a high profile New York hedge fund, for example, has been a significant buying of cut-price Greek bonds. RBS Eyes Libor Settlement Soon (WSJ) RBS wants to seal a settlement with regulators over its alleged rigging of key interest rates in the coming months, as the partstate-owned bank looks to draw a line under the scandal. Speaking to reporters at the bank's third-quarter results presentation, Chief Executive Stephen Hester said he would be "disappointed" if he couldn't provide details on a settlement by February. "We are up for settling with all and everyone as soon as they are ready. But each regulator has to satisfy itself that it has all the facts," he said. Deutsche Bank Faces Top Surcharge as FSB Shuffles Tiers (Bloomberg) Deutsche Bank would be required to hold more capital and Bank of America Corp.’s burden stands to be reduced as global regulators shuffled the competitive balance among the world’s biggest banks. Citigroup, HSBC and JPMorgan join Deutsche Bank as firms that will be targeted for a capital surcharge of 2.5 percent, according to an updated list published yesterday by the Financial Stability Board. The change means Bank of America already exceeds requirements, while Deutsche Bank would be more than 2 percentage points below the new minimum of 9.5 percent. “That limits earnings potential for Citigroup, JPMorgan and Deutsche Bank compared to Bank of America, all other things being equal, so it’s certainly a competitive advantage for them,” said David Kass, a professor at the University of Maryland’s Robert H. Smith School of Business. Short-Sellers of Europe Set to Be Unmasked (CNBC) The European Securities and Markets Authority (ESMA), the EU regulator, has issued new rules on the short-selling of securities indicating that anyone with short positions of greater than 0.2 percent in an EU company’s shares must report it to regulators. Positions of more than 0.5 percent will be publicly released, naming both the company and the short-seller. Public disclosure is triggered any time that level is hit with each 0.1 percent increase or decrease after that. NYSE Open For Business Shows Wall Street Still Vulnerable (Bloomberg) The Securities and Exchange Commission may consider whether exchanges’ emergency regimens need to be bolstered, according to a person familiar with the regulator’s thinking who asked not to be named because the matter is private. The industry’s decision to halt equities and bond trading shows the challenge of maintaining markets when a catastrophe threatens New York City, home to 168,700 securities industry workers. “One of the purposes of having electronic exchanges and basing them away from New York City is for the market to be more robust and stay open,” Charles Jones, a finance professor at Columbia Business School in New York, said in a phone interview. “This is what the back-up plans were designed for. But the markets didn’t open.” David Blaine Entertains New Yorkers After Hurricane Sandy (NYP) When a backup generator at Old Homestead Steakhouse sputtered, the restaurant started serving hundreds of pounds of steaks, burgers, lobster tails and shrimp on the street outside for downtown denizens. David Blaine, the modern-day Harry Houdini who spent days recently being shocked in a steel suit, pitched in to provide spontaneous street entertainment. “David was rumbling by on his motorcycle, and he stopped to see why there was a line on 14th Street,” said a spy, adding 800 chowed down. Blaine then asked restaurant co-owner Greg Sherry if there was a deck of cards in the house. Blaine used the full deck and some spare silverware to perform magic tricks outside for an hour and a half. The magic man, an Old Homestead regular, was offered a doggie bag but said he’s on a special diet in preparation for his next stunt. Romney Faces Sale With A Win (WSJ) Mr. Romney's assets, valued at between $190 million and $250 million, include investments in hedge funds, private-equity funds and partnerships at Bain Capital, which he ran for 15 years. These entities have ownership stakes in dozens of companies that could be affected by government action, such as radio firm Clear Channel Communications Inc. and a video-surveillance firm based in China. Many businessmen and wealthy individuals have entered government service and sold off holdings. But a Romney sale would be especially complicated. Investments in private-equity funds can be difficult to value and seldom change hands. Any sale would have to be handled carefully to avoid any appearance that the incoming president was getting favorable treatment from a buyer. What Do Asia Markets Fear? Romney As President (CNBC) At a time of heightened uncertainty, with the ongoing European debt crisis and the upcoming leadership transition in China, a new president in the world’s largest economy will cause additional nervousness among Asian investors, experts told CNBC. “Asian traders don’t like change in leadership. You would see weakness in the markets if Romney won, because people would question how well he would deal with the impending doom of the ‘fiscal cliff.’ Obama would be a safer bet, as investors would enjoy continuity at a time of a lot of uncertainty,” said Justin Harper, market strategist, at IG Markets...Besides, Romney’s stance on China is particularly worrying feels Harper. The presidential hopeful has said he will name China a “currency manipulator,” which could lead to more tensions with the mainland, including on the trade front. “You would expect trade between the two nations to suffer, this would have a knee-jerk reaction on trade in the region,” he added. Fed Up With Fees (NYP) The manager of a large public pension’s private-equity program said for the last 24 months he has not committed money to any new private-equity fund that doesn’t give all fees it charges its companies back to investors. He is doing this because he wants an alignment of interest where he and the private-equity firm only make money by reselling a business. PE firms, he believes, will stop charging their companies fees if there is little in it for them. So, KKR, for example — responding to pressure — has agreed to give all fees it charges its companies in its new fund back to investors, the pension manager said. KKR is not the only firm making this change. Apax Partners, Blackstone Group, Centerbridge Partners, Providence Equity and TPG Capital are among those making the same concessions, the pension manager said. Local shelter mistakenly euthanizes family pet (WRCB) After waiting 10 days to be reunited with his dog, a local college student learned the family's pet had been euthanized by mistake. The Lab mix was being held at McKamey Animal Center, where administrators say a paperwork mix up led to the dog's death. Matt Sadler adopted the three-year-old Lab mix when he was just a puppy. "That was my best friend," Sadler says. "He was there for me through my parents' divorce and a lot of really hard tough times in my life." It was hard for Matt when Zion was quarantined last week, after jumping on a pizza delivery driver. "The lady didn't want to press charges, it wasn't anything serious, but the law has a 10-day quarantine period," he says. Because Zion was a month past due on his yearly rabies vaccine, he was held for the full 10 days at McKamey Animal Center. Thursday, Matt eagerly returned to the facility to take Zion home. "She says, ‘I'm sorry, Matt, we accidentally euthanized your dog'," Sadler says...McKamey has offered to cremate Zion, and allow Matt to adopt any dog he chooses.

Opening Bell: 11.12.12

Leucadia Agrees to Buy Jefferies for About $2.76 Billion (Bloomberg) Leucadia National Corp agreed to buy the the portion of Jefferies Group it doesn’t already own for about $2.76 billion. Investors will receive 0.81 Leucadia share for each Jefferies share they own, the companies said today in a statement. The deal values the entire company at about $3.59 billion, based on data from the company’s most recent 10-Q regulatory filing. Jefferies management will run the firm, according to the report. Leucadia already holds about 28.6 percent of New York-based Jefferies. Jefferies Chief Executive Officer Richard Handler will become CEO of New York-based Leucadia after the transaction is completed, which the companies said they expected in the first quarter. Handler will remain CEO of Jefferies as well. “This transaction represents the realization of a personal dream for me,” Handler, 51, said in the statement. Greece Passes 2013 Austerity Budget (WSJ) Greece passed on Monday a 2013 austerity budget needed to unlock further funding for the cash-strapped country, although international creditors have indicated the disbursement may be weeks away as they squabble over how to resolve the nation's debt problems. Euro-zone finance ministers will meet Monday in Brussels, where they had been expected to approve Greece's next aid payment of €31.5 billion ($40 billion), but no decision is now expected until they are assured the country's overhauls are on track. The budget, approved by a 167-128 vote, foresees Greece taking €9.4 billion of budget cuts next year, dealing a fresh blow to an economy seen contracting 4.5% next year, its sixth year of recession. Spain Needs A Bailout Urgently: Former ECB Member (CNBC) Bini Smaghi told CNBC that Spain must not waste any more time and that it needed to apply for help from Europe's bailout fund. "They need to revitalize the economy and they need lower interest rates [and] the only way to do that [is] to request a program," he said, adding that Spain should have done so "yesterday." White House Plans Public Appeal On Deficit (WSJ) Mr. Obama has planned the meetings as policy makers start work to craft a package of deficit-reduction measures that could come in place of the so-called fiscal cliff, the mandatory spending cuts and tax increases scheduled to begin in January. His meetings with labor and business leaders come before he meets with congressional leaders Friday, evidence the White House believes Mr. Obama can use momentum from his re-election to marshal outside support and heighten pressure on Republicans to agree to tax increases on upper-income earners. The strategy comes as many Republicans appear to have softened their antitax rhetoric in the wake of the election, with many openly acknowledging that higher taxes will likely be part of any plan to reduce the deficit. Boehner Tells House GOP to Fall in Line (NYT) On a conference call with House Republicans a day after the party’s electoral battering last week, Speaker John A. Boehner dished out some bitter medicine, and for the first time in the 112th Congress, most members took their dose. Their party lost, badly, Mr. Boehner said, and while Republicans would still control the House and would continue to staunchly oppose tax rate increases as Congress grapples with the impending fiscal battle, they had to avoid the nasty showdowns that marked so much of the last two years. Members on the call, subdued and dark, murmured words of support — even a few who had been a thorn in the speaker’s side for much of this Congress. It was a striking contrast to a similar call last year, when Mr. Boehner tried to persuade members to compromise with Democrats on a deal to extend a temporary cut in payroll taxes, only to have them loudly revolt. No Increase Of Banker Bonuses This Year (NYP) That’s the dour view of executive-compensation firm Johnson Associates, which says investment-banking business is so slow that after the sector’s workers bore the brunt of most of the 7,000 job losses on the Street this year, they will find the bonus pie smaller as well. “It’s a tremendous drop from five years ago. If you were getting an average bonus of $400,000 back in 2007, then this year it will probably be around $200,000 or $250,000,” says Alan Johnson, managing director of Johnson Associates...However, fixed-income executives, who sell bonds, should see bonuses rise this year by something between 10 percent and 20 percent. Deputies: Man impersonated federal officer to get into Epcot for free (Orlando Sentinel) A 74-year-old Miami man who was trying to avoid paying nearly $100 to get into Epcot, was arrested after he impersonated a Federal officer. Emerito Pujol flashed a fake badge at an Epcot employee as he passed through the turnstiles at the park around noon on Saturday. The employee challenged him and asked to see the badge again. He claimed he was an undercover officer who was looking for someone, according to an arrest report. When a security guard approached him, Pujol again claimed he was "in service" and was "guarding someone important," the report states...Pujol was arrested and charged with unlawful use of a police badge, falsely impersonating an officer and petty theft. No Individual Charges In Probe Of JPMorgan (WSJ) The top U.S. securities regulator doesn't intend to charge any individuals in its planned enforcement action against J.P. Morgan for the allegedly fraudulent sale of mortgage bonds, according to people close to the investigation. The largest U.S. bank by assets will pay a significant financial penalty under the proposed deal, which has been approved by Securities and Exchange Commission staff but not by the agency's five commissioners, said the people close to the probe. Nomura Launches Private Equity Index (FT) The Japanese bank will look to match the returns of private equity funds – which take over companies, restructure them, and then seek to sell them at a profit – by investing in publicly traded companies in sectors that are attracting attention from buy-out groups. Morgan Stanley Sues Ex-FrontPoint Manager Over Insider Trading (Reuters) In a complaint filed in Manhattan federal court on October 31, Morgan Stanley sued ex-FrontPoint Partners hedge fund manager Joseph "Chip" Skowron over the funds the bank paid to the U.S. Securities and Exchange Commission. The lawsuit also called for unspecified compensatory and punitive damages. Doctor-turned-stock picker Skowron pleaded guilty in August to trading stock of Human Genome Sciences Inc in 2008 based on non-public information he admitted to having received from a consultant for the biotech company, who also pleaded guilty to insider trading charges. Skowron was sentenced to five years in prison and ordered to forfeit $5 million. "Beyond the harm attendant to having one of its managing directors plead guilty to serious criminal conduct, the firm expended its own reputational capital by defending Skowron during the years it believed, based entirely on his misrepresentation, that he had not violated the law," the complaint said. So, maybe that Romney face tattoo wasn’t such a good idea... (Politico) With the election over, supporters of Mitt Romney have to pack up their campaign signs and paraphernalia and get on with their lives. But what if you can’t get rid of that stuff? Literally. Eric Hartsburg caught some attention in the weeks leading up to the election for having the Romney campaign’s logo tattooed on his face. Suffice to say, he’s not happy with Tuesday’s results. “Totally disappointed, man,” Hartsburg told POLITICO. “I’m the guy who has egg all over his face, but instead of egg, it’s a big Romney/Ryan tattoo. It’s there for life.” Hartsburg’s tattoo covers a 5-by-2 inch space on the side of his face, and he did it after raising $5,000 on eBay for the effort. He didn’t even tell his wife he planned to get the tattoo until about an hour before. “Right away, she was taken aback,” Hartsburg said, adding that his wife is also a Romney/Ryan supporter. “My 15-year-old son, however, he was all about it.”

Opening Bell: 07.09.12

BofA Figures In Drug Probe (WSJ) A Mexican cocaine-trafficking cartel used accounts at Bank of America to hide money and invest illegal drug-trade proceeds in U.S. racehorses, the Federal Bureau of Investigation said. The alleged ties between the violent drug gang known as Los Zetas and the second-largest U.S. bank by assets were described in a 35-page affidavit filed in federal court in Texas last month. According to an FBI agent, a horse-buying and training business created to launder drug money had accounts at the Charlotte, N.C., bank. Libor Probe Moves To Political Arena (WSJ) The scandal over banks' manipulation of key interest rates cost the jobs of three senior financial figures last week. On Monday, the deputy governor of the Bank of England will try to ensure it doesn't derail his own career. Paul Tucker, a leading candidate to become the next governor of the Bank of England, will testify Monday afternoon before a Parliamentary committee that is examining how Barclays and other global banks improperly tried to influence interest rates like the London interbank offered rate...Barclays, after reaching a £290 million settlement with U.S. and British regulators over its attempts to manipulate Libor, sought to defend itself by releasing notes from an October 2008 phone call between Mr. Tucker and Robert Diamond. According to Mr. Diamond's notes from the call, Mr. Tucker relayed concerns from "senior" British government officials about Barclays's above-average Libor submissions. "Mr. Tucker stated…that while he was certain we did not need advice, that it did not always need to be the case that we appeared as high as we have recently," Mr. Diamond wrote to two of his colleagues the day after the call. Diamond Antithesis Seen As Key Step To Repairing Barclays (Bloomberg) The British lender faces a criminal probe and political pressure to curb or separate the investment banking unit that Diamond built up during his 16-year career at Barclays from the consumer bank. The unit generated 61 percent of the bank’s first-quarter pretax profit. At a Parliamentary hearing last week, lawmakers asked if the culture at the investment bank was “rotten” and if he lived in a “parallel universe.” Former Barclays CEO: I Too Fell for the Diamond Myth (FT) "It was a close call," Taylor says of his decision to retain Diamond as head of Barclays Capital. "I suspect the subsequent history of the business would have been very different had I asked him to go. I deserve blame for being among the first to succumb to the myth of Diamond’s indispensability, to which some in Barclays were still in thrall only a matter of days ago." SEC set to hand out up to $452M to whistleblowers (NYP) “The SEC is receiving two to three tips every day that are worth pursuing, and they’re farming them out to staffers for investigation,” said Lawrence A. West, a lawyer with Latham & Watkins. “SEC officials are eager to pay out and publicize the first whistleblower award,” said West, whose firm has gathered a number of tipsters under the new law. “Once the first award is publicized, tips to the SEC from disgruntled employees are almost certain to increase substantially.” Romney Mines Hamptons For Political Cash (NYT) EAST HAMPTON, N.Y. — A woman in a blue chiffon dress poked her head out of a black Range Rover here on Sunday afternoon and yelled to an aide to Mitt Romney. “Is there a V.I.P. entrance? We are V.I.P.” (No such entrance existed.)...what was billed as a day of elegant campaign events at the homes of the ultrarich turned out to be an afternoon of curious and clashing tableaus: protesters with their bandannas and Occupy Wall Street-inspired chants (“We got sold out, banks got bailed out!”) standing amid multimillion-dollar mansions, where live bands played “Margaritaville” and donors dined on prosciutto-wrapped melon balls...After that, Mr. Romney attended events at the Southampton homes of Clifford Sobel, the former United States ambassador to Brazil, and David Koch, the billionaire industrialist and longtime benefactor of conservative political causes. The event at Mr. Koch’s home drew about 200 protesters, who...went so far as to hire a local pilot to fly a giant red and black banner over Mr. Koch’s house, which read: “Romney has a Koch problem,” a play on the drug. (Mr. Koch’s name is pronounced the same as the word coke.) A truck, festooned with the logos of big banks like Citigroup and Wells Fargo, circled the neighborhood with a plastic dog on the roof, a jab at Mr. Romney’s much-mocked family vacation in which he traveled with his Irish setter inside a pet carrier on the roof of a car. Barclays mulls split after Libor scandal: report (MarketWatch) Board directors at U.K. bank Barclays PLC BCS -1.72% are considering splitting the company into two units, as regulatory scrutiny mounts in the wake of its role in the Libor interest-rate fixing scandal, The Sunday Times reports without citing sources. The newspaper says Barclays is examining plans to spin off its investment banking arm, which could be floated in New York, with the U.K.-headquartered retail and commercial bank retaining its London listing. (A person familiar with the matter said the story was inaccurate.) Roubini: My 'Perfect Storm' Scenario Is Unfolding Now (CNBC) In May, Roubini predicted four elements – stalling growth in the U.S., debt troubles in Europe, a slowdown in emerging markets, particularly China, and military conflict in Iran - would come together in to create a storm for the global economy in 2013. “(The) 2013 perfect storm scenario I wrote on months ago is unfolding,” Roubini said on Twitter on Monday. Tighter Control For Euro Banks (WSJ) The establishment of a single authority, with a single set of rules for the region's banks, is seen by Germany and other strong economies as an essential condition before they will consider sharing resources with other euro-zone countries. House-crasher sentenced after enjoying Diddy's food, cigars and toothbrush (NYP) A East New York man, busted for sneaking into rapper Sean “Diddy” Combs’ palatial East Hampton spread in April, guzzled the star’s top-shelf liquor, washed with his soap, and even used his toothbrush, officials revealed yesterday. “I brought a cheesesteak, a cheesecake, a bucket of fried chicken — which I ate at the house — and drank a ‘dollar’ bottle of Hennessy and four cans of Pepsi,” Quamine Taylor told prosecutors at his sentencing yesterday. He even slathered Diddy’s Frank’s Red Hot sauce on his grub, and drank a bottle of Hpnotiq, a vodka liqueur, he said, adding, “After I ate, I went upstairs and went to sleep.” He also smoked three of Diddy’s Dutch Masters cigars and drank a can of orange soda. Then he freshened up using Diddy’s soap and splashing on his aftershave.

Opening Bell: 03.05.13

Senate Report Said To Fault JPMorgan (NYT) A report by the Senate Permanent Subcommittee on Investigations highlights flaws in the bank's public disclosures and takes aim at several executives, including Douglas Braunstein, who was chief financial officer at the time of the losses, according to people briefed on the inquiry. The report's findings — scheduled to be released on March 15 — are expected to fault the executives for allowingJPMorgan to build the bets without fully warning regulators and investors, these people said. The subcommittee, led by Senator Carl Levin, could ask Mr. Braunstein and other senior executives to testify at a hearing this month, according to the people. The subcommittee does not currently intend to call the bank's chief executive, Jamie Dimon, but Congressional investigators interviewed Mr. Dimon last year. Citi CEO Is Keeping Score (WSJ) At a gathering of 300 executives last month at a Hilton Hotel in East Brunswick, N.J., Mr. Corbat proposed a slate of new, more-rigorous ways to track both the performance of individual executives and the third-largest U.S. bank as a whole, said people who were there. His approach includes score cards that will rate top managers across the New York company in five categories. "You are what you measure," Mr. Corbat told the gathering. Report Faults FSA Over Rate Rigging (WSJ) The report, commissioned by the FSA in the wake of the Barclays BARC.LN +1.48%PLC £290 million ($436.1 million) settlement with regulators over attempted rate-rigging, shows the regulator either ignored or failed to follow up on a series of red flags highlighting problems with the rates. Between 2007 and 2009, the FSA said it found 26 pieces of correspondence citing direct references to "lowballing"—where banks understated their borrowing costs to make their funding positions look stronger. These include two telephone calls from Barclays managers flagging problems with rate-setting process. The regulator also said it overlooked an article in The Wall Street Journal highlighting problems with the London interbank offered rate because the article wasn't widely read within the FSA. Heinz CEO's Golden Exit Deal (WSJ) The total would consist of a $56 million "golden parachute" including bonus payments and other items, $57 million in pension and deferred compensation and $99.7 million of Heinz shares that Mr. Johnson owns or controls, according to a Securities and Exchange Commission filing Monday. EU Said To Weigh Extra Years For Irish Rescue Loans (Bloomberg) The European Union is weighing whether to extend Ireland’s rescue loans by five years or more, buttressing the government’s efforts to become the first country to exit a bailout since the euro-region debt crisis began. Hotel boots rowdy Rodman over Kim Jong Un scene (NYP) Dennis Rodman, just back from visiting Kim Jong Un, was escorted out of the Time Hotel in Midtown on Sunday after spending hours at the restaurant bar loudly telling anyone who would listen what a great guy the North Korean dictator is. “He was at the bar at Serafina for three hours,” says a spy. “He kept saying what a nice guy Kim is, and how Kim just wants to talk to President Obama about basketball. He was waving around a signed copy of the dictator’s huge manifesto, telling everyone they should read it.” Added the witness, “Dennis was making a total jerk of himself. He wouldn’t leave, and he wouldn’t let anyone talk to him about shutting up, or what an oppressive country North Korea is. Eventually he had to leave the bar because the bartender was starting to get [bleep]ed-off.” Ikos Co-Founder Coward Sues Ex-Wife Over Hedge-Fund Software (Bloomberg) Martin Coward, the co-founder of Ikos Asset Management Ltd., sued his estranged wife, Elena Ambrosiadou, in a U.K. court over the copyright ownership of computer software that runs the hedge fund’s trading platform. Coward was the “architect” of the “bedrock of the family business,” his lawyers said at the start of a three-week trial in London today. “Practically all of the financial markets expertise at Ikos resided in Coward himself,” said Michael Bloch, Coward’s lawyer. Ikos, which uses computer algorithms to spot profitable trades in futures markets, has been embroiled in lawsuits involving Coward and other former employees around the globe. The estranged couple, who started divorce proceedings in Greece in 2009, have filed more than 40 lawsuits against each other in at least four countries. Sequester Leaves US In 'Fantasy' World: Analyst (CNBC) Stephen King, chief global economist at HSBC, said that the U.S. was living in a"fantasy world" over its growth forecasts. "If you look at the projections from the Congressional Budget Office (CBO) they assume that growth goes back to between 4 to 5 percent in real terms between 2014 and 2018. Their numbers suggest that the U.S. will post the fastest rate of productivity growth of any decade in the last 50 or 60 years," King told CNBC's "European Closing Bell." Former Lehman Derivatives Banker Helps Paschi Unravel Contracts (WSJ) Riccardo Banchetti, whose work packaging derivatives at Lehman Brothers Holdings Inc. got him the top European job at the firm a week before it failed, is now making a living unraveling the kind of deals he once developed. Banchetti worked with Banca Monte dei Paschi di Siena SpA to uncover 730 million euros ($955 million) of losses that the world’s oldest bank hid through the use of derivatives. The Italian banker, who also advised JPMorgan Chase & Co. (JPM) on its defence against fraud charges over swaps with Milan, has scrutinized more than 10 billion euros of transactions since leaving Lehman, according to a person with knowledge of his activities who asked not to be identified because they weren’t authorized to speak publicly. Drugs found in Florida suspects' orifices, deputies say (WPBF) According to the Charlotte County Sheriff's Office, a deputy who initiated a traffic stop on a car without brake lights found cocaine in a man's prosthetic leg. The deputy also found morphine and hydromorphine pills in a woman's bra and a hypodermic needle hidden in another woman's buttocks.