Former UBS Trader Found Guilty (WSJ) Former trader Kweku Adoboli was found guilty on one count of fraud in connection with a $2.3 billion loss the Swiss bank suffered last year, as the juryin the alleged rogue-trading case continued to deliberate on five other counts he was charged with. The partial verdict comes nearly a week after the jury began deliberating following a roughly eight-week trial. It is unclear when the jury might reach verdicts on the other five counts or when sentencing might take place. Mr. Adoboli pleaded not guilty to all six counts. Shakeup At Credit Suisse (WSJ) Credit Suisse said Tuesday that it will combine the Swiss bank's asset management unit with its private bank, but stopped short of announcing the more drastic revamp analysts expected after crosstown rival UBS decided to fire 10,000 bankers. Robert Shafir, who currently heads the U.S. business of Credit Suisse, will take the helm of a new private banking and wealth management division jointly with Hans-Ulrich Meister, who has run the private banking business, the bank said. At the investment bank, Gael deBoissard is being promoted to co-head of the division, jointly with incumbent Eric Varvel. Following the revamp, Credit Suisse will have only two units—wealth management and investment banking--which are distinctly separate from each other, a move that is "in alignment with the new regulatory reality," Chairman Urs Rohner said. Greece Waits Nervously For Vital Bailout Funds (Reuters) Officials familiar with preparations for the finance ministers' meeting expect a "political endorsement in principle" on unfreezing loans to Athens, after Greece completed almost all the reforms that were required of it in exchange for funding. The final go-ahead from the ministers is likely to come only once the remaining few Greek reforms are in place and once there is agreement in the euro zone on how to reduce the country's huge debt and secure extra financing while it is being done. French Downgrade Widens Gulf With Germany as Talks Loom (Bloomberg) France’s loss of the top credit rating at Moody’s Investors Service may weaken President Francois Hollande’s leverage in European budget talks and deepen concern in Germany over its neighbor’s lagging competitiveness. The downgrade late yesterday of Europe’s second-biggest economy underscores the concern expressed by allies of German Chancellor Angela Merkel that the Socialist Hollande’s failure to recognize the urgency of France’s woes risks a deepening of Europe’s slump. “This downgrade will certainly increase pressure on France big-time,” Jan Techau, director of the Carnegie Endowment for International Peace office in Brussels, said today in a phone interview. “It gives Germany more of an edge over France.” ‘Tide Turning’ Against France, Say Economists (CNBC) “The tide is turning for France. Although the country's bond market is likely to remain resilient — the yield on 10-year paper is little changed [Tuesday] morning and still stands a whisker above its record low of 2.06 percent on July 19 — French debt looks more and more overvalued relative to fundamentals,” Nicholas Spiro, Managing Director of Spiro Sovereign Strategy, said in a note on Tuesday. France has enjoyed low borrowing costs as investors have viewed the country as a safe haven in comparison with its southern European cousins. The downgrade of France to AA1 with a negative outlook by Moody’s has thrown its “deteriorating fundamentals….into sharp relief” Spiro said. China’s Richest Woman Divorces Husband, Fortune Declines (Bloomberg) Longfor Properties Co. Chairwoman Wu Yajun is no longer China’s richest woman after divorcing Cai Kui and transferring about 40 percent of the developer’s shares the couple used to own to her ex-husband. Her stake in Longfor, which Wu co-founded with Cai, dropped from a combined 72 percent to 43 percent, while Cai retains 29 percent, according to filings from Hong Kong’s stock exchange. Wu’s net worth is estimated at $4.2 billion, down from $7.3 billion as of 5:30 p.m. New York time yesterday, according to the Bloomberg Billionaires Index. New York Prepares Lawsuit Against Credit Suisse (Reuters) The New York attorney-general is preparing to file a civil lawsuit against Credit Suisse for misleading investors who lost billions of dollars on mortgage-backed securities, according to a source familiar with the matter. The lawsuit, which is expected to be filed on Wednesday, will allege that Credit Suisse misrepresented the quality of loans packaged in securities, according to the source. Petraeus Mistress Paula Broadwell To Jill Kelley: 'I can make you go away' (NYDN) The notes Paula Broadwell sent to Jill Kelley were far more sinister than previously reported and seemed like the rantings of someone “clearly unhinged,” a close friend of Kelley said Monday. “This wasn’t just a catfight. Any normal person who got emails like that would have immediately called the police,” said the friend. She said Kelley read her the emails when she called, panic-stricken and seeking advice in the days before the scandal became a stunning public spectacle and led to Petraeus’ resignation as CIA director. The friend, who did not want to be identified, said Kelley saw the emails as death threats, specifically one in which Broadwell vowed to “make you go away.” [Meanwhile,] Broadwell...bloodied a female news photographer’s forehead Monday in a confrontation outside the biographer’s Charlotte, N.C., home. Broadwell smacked the photographer with the driver’s-side door of her Nissan Pathfinder SUV. “I had my camera and in all the chaos the door slammed and I got hit in the head with the flash,” said Nell Redmond, a freelancer for The Associated Press. Redmond suffered a small cut and is not pressing charges. Morgan Stanley’s Doom Scenario: Major Recession in 2013 (CNBC) The bank’s economics team forecasts a full-blown recession next year, under a pessimistic scenario, with global gross domestic product (GDP) likely to plunge 2 percent. “More than ever, the economic outlook hinges upon the actions taken or not taken by governments and central banks,” Morgan Stanley said in a report. Under the bank’s more gloomy scenario, the U.S. would go over the “fiscal cliff” leading to a contraction in U.S. GDP for the first three quarters of 2013. In Europe, the bank’s pessimistic scenario assumes a failure of the European Central Bank (ECB) in cutting rates and a delay of its bond-buying program. Judge Tosses Suit Over AIG (WSJ) A federal judge in Manhattan dismissed a $25 billion lawsuit by Starr International Co., which Mr. Greenberg runs, against the New York Federal Reserve Bank over claims the Fed breached its fiduciary duty to AIG's shareholders in the rescue during the U.S. financial crisis. It is one of two lawsuits Starr, AIG's largest shareholder at the time of the government takeover, is pursuing over the bailout. Mark Cuban Throws A Tantrum On Facebook Fee (NYP) Facebook used to be a “time suck” — now it just sucks. That’s the view of Dallas Mavericks owner Mark Cuban, who is urging marketers to take their business elsewhere after the social network started charging the tech billionaire to send messages to all the team’s fans. “In the past we put FB first, Twitter second,” Cuban wrote in a roughly 1,700-word blog post calling out the social network. “FB has been moved to the bottom of a longer list.” He added: “FB doesn’t seem to want to accept that its best purpose in life is as a huge time suck.” At issue is Facebook’s filtering of posts that appear in users’ news feeds. The site says it is trying to present users with content that they have shown an interest in while cutting down on spam. But Cuban says it is a pay-to-play move. He argues that Facebook is making it harder for marketers to reach their fans without paying for so-called “promoted posts.” And making the site more targeted and efficient is actually a mistake, according to Cuban. He claims most people go to the site because it’s a “time suck” that they enjoy. Cannibal Cop Pleads Not Guilty (NYDN) “cannibal cop,” accused of conspiring with an online buddy to kidnap, rape and slow-cook women, pleaded “not guilty” Monday to two federal charges. Gilberto Valle, 28, was arraigned in Manhattan Federal Court on charges of conspiracy to commit kidnapping and accessing the federal National Crime Information Center database without authorization. Valle’s public defender, Julia Gatto, made a third attempt at getting bail for her now-infamous client. "You have a hard row to hoe," said Judge Paul Gardephe...Valle — who was suspended after being arrested last month in a joint NYPD and FBI investigation — is accused of chatting last July with a sick online buddy about “kidnapping, cooking and eating body parts” of a woman identified as Victim 1, according to the indictment released Friday.

UBS Earnings Helped By Wealth-Management Focus, Risk-Cutting (WSJ) UBS's first-quarter earnings showed that the Swiss bank's strategy of shifting its focus to managing assets for wealthy clients and reducing risk is starting to pay off, demonstrating that it is putting behind it a troubled past marked by huge investment bank losses during the financial crisis, a bruising battle with U.S. tax authorities and a trading scandal last year. Worries about the global economy are likely to prevent clients from investing much in the second quarter, but "we believe our wealth-management businesses as a whole will continue to attract net new money, as our clients recognize our efforts and continue to entrust us with their assets... We have the utmost confidence in our firm's future," UBS said in a statement. The bank's wealth-management units recorded a rise in pretax profit during the quarter and attracted CHF10.9 billion ($12.1 billion) in new assets from clients. UBS also managed to shed more risky assets during the quarter, raised new capital and is on track to meet its target of saving CHF2 billion in costs annually...Reported results for the bank as a whole were less pleasing because an accounting loss on UBS's own debt led to a 54% drop in net profit. Excluding this charge, which was higher than forecast, earnings beat analysts' estimates and contributed to the rise in UBS's shares. The Zurich-based bank said net profit fell to 827 million Swiss francs in the quarter ended March 31 from CHF1.81 billion a year earlier. Revenue fell 22% to CHF6.53 billion from CHF8.34 billion, while operating expenses declined 15% to CHF5.22 billion. Wealthy Americans Queue To Give Up Their Passports (Bloomberg) Rich Americans renouncing U.S. citizenship rose sevenfold since UBS AG (UBSN) whistle-blower Bradley Birkenfeld triggered a crackdown on tax evasion four years ago. About 1,780 expatriates gave up their nationality at U.S. embassies last year, up from 235 in 2008, according to Andy Sundberg, secretary of Geneva’s Overseas American Academy, citing figures from the government’s Federal Register. The embassy in Bern, the Swiss capital, redeployed staff to clear a backlog as Americans queued to relinquish their passports. The Big Doubt Over Facebook's IPO (WSJ) "The question with Facebook and many of the social media sites is, 'What are we getting for our dollars?'" said Michael Sprague, vice president of marketing at Kia Motors Corp.'s North American division. The automaker has advertised on Facebook since 2009 and plans to increase its ad spending on the site. While building brand awareness on a site with 900 million users is valuable, Mr. Sprague said he's unclear if "a consumer sees my ad, and does that ultimately lead to a new vehicle sale?" The concerns from Kia and other advertisers underscore the difficulties of measuring results of nascent-forms of social-media advertising. Madness In Spain Lingers As Ireland Chases Recovery (Bloomberg) “Ireland faced up to its problems faster than others and we expect growth there rather soon,” said Cinzia Alcidi, an analyst at the Centre for European Policy Studies in Brussels. “In Spain, there was kind of a denial of the scale of the problem and it may be faced with many years of significant challenges before full recovery takes place.” Euro-Zone Economic Woes Deepen (WSJ) The euro-zone economy contracted by 0.3% in the fourth quarter of last year, and most recent data suggest it did so again in the first quarter of this year. Many economists regard two quarters of contraction as indicating an economy is in recession. Carlyle's big-name IPO may not generate big gains (NYP) Like debt asset manager Oaktree Capital Group, which declined on its first day of trading earlier this month, Carlyle warns that its first priority is to the interests of its fund investors, and it could make decisions that would reduce revenue in the short-term, such as limiting the assets under management that it oversees or reducing management fees. Did May Day Save Occupy Wall Street? (TDB) For some protesters, the lack of one or two key demands and a stronger organizational structure made the day less effective than it could have been. “I think they have to state their demands along with their actions,” said Anton Alen, a student at Hunter College, adding that he thinks Occupy Wall Street has been clear on many things it would like to see changed. Alen said that the idea of trying to occupy another space Tuesday night was in the right spirit but needed to be thought out better. “I don’t think it can be so spontaneous and still be effective,” Alen said. Sofia Gallisa of Fort Greene, Brooklyn, disagreed. “This isn’t about specific demands,” she said. “It’s never been about specific demands.” Occupy Wall Street has changed the kind of discussions Americans are having about inequality, she said, particularly around issues of class. Peter Schiff: US Treasurys Are ‘Junk,’ Dollar Headed for Collapse (CNBC) “As far as I am concerned, U.S. Treasurys are junk bonds,” Schiff said on CNBC Asia’s “Squawk Box.” “And the only reason that the U.S. government can pay the interest on the debt, and I say ‘pay’ in quotes because we never pay our bills. We borrow the money so we pretend to pay, but the only reason we can do it is because the Fed has got interest rates so artificially low.” Greenspan Says U.S. Stocks ‘Very Cheap,’ Likely to Rise (Bloomberg) “There is no place for earnings to grow except into stock prices,” Greenspan said yesterday. Treasury: No Decision On Floating-Rate Notes (WSJ) "Treasury is in the process of analyzing the feedback, and we continue to study the benefits and optimal terms of a Treasury [floating rate note]," Under Secretary for Domestic Finance Mary Miller said in a statement. Mr. Met is rated number 1 in Major League Baseball (NYDN) The longtime Flushing favorite was chosen as the nation’s No. 1 sports mascot based on his likeability, familiarity and several other factors. Even better, in a reversal of recent on-field fortunes, Mr. Met landed the top spot over NL East rival the Phillie Phanatic.

Greek Bond Swap Deal Rests on Knife Edge (FT) People close to some bondholders warned other investors to take seriously threats by policymakers that if the deal fails Greece will default on its debt. “Some investors seem to think they will be rescued. That just isn’t the case,” one said. People involved in the deal denied that there was any nervousness about the outcome but nobody was willing to guess how high the participation rate would be. Slim Beats Gates in First Daily Billionaire Ranking (Bloomberg) If you like obsessively measuring your penis you'll love this: Carlos Slim, the telecommunications tycoon who controls Mexico’s America Movil SAB, is the richest person on Earth, according to the Bloomberg Billionaires Index, a daily ranking of the world’s 20 wealthiest individuals...The Bloomberg Billionaires Index takes measure of the world’s wealthiest people based on market and economic changes and Bloomberg News reporting. Each net worth figure is updated every business day at 5:30 p.m. in New York. The valuations are listed in U.S. dollars. Zuckerberg Doesn’t Rank on Billionaire Index (Bloomberg) Sad trombone: At the time of the offering, Zuckerberg is likely to sell about $1.75 billion of Facebook stock to pay off the tax obligation he will incur when he exercises options to buy 120 million shares. The combined transactions will dilute Zuckerberg’s stake from 28.4 percent to about 21 percent. If the company maintains its projected $100 billion valuation, that would make Zuckerberg worth about $21 billion, less than the $28.4 billion implied by his stated ownership. At that net worth, Zuckerberg isn’t rich enough to qualify for the Bloomberg Billionaires Index, a new daily ranking of the world’s 20 richest people. The 20th spot is currently occupied by L’Oreal heiress Liliane Bettencourt. AIG to Sell $6 Billion In Asian Insurer's Stock (WSJ) American International Group Inc. kicked off a $6 billion sale of shares in Asian life insurer AIA Group Ltd. on Monday morning in Hong Kong, moving forward with plans to repay another chunk of its 2008 U.S. bailout. AIG said the shares will be placed with institutional investors and expects them to be priced by Tuesday. The 1.7 billion shares up for sale represent around 14% of AIA, less than half the 32.9% stake AIG holds, according to a term sheet. Proceeds from this week's sale have been earmarked to repay the U.S. government, which rescued AIG from near collapse during the financial crisis with a record $182.3 billion bailout that has been partially repaid. The Treasury Department still has to recoup about $50 billion in taxpayer funds, and about $8.4 billion of that amount will be repaid when AIG sells the AIA shares and other assets, including its airplane-leasing subsidiary. The rest of the money—roughly $42 billion—is supposed to come from the government's sale of its 77% stake in AIG. Lenders Stress Over Test Results (WSJ) The 19 biggest U.S. banks in January submitted reams of data in response to regulators' questions, outlining how they would perform in a severe downturn. Now, citing competitive concerns, bankers are pressing the Fed to limit its release of information—expected as early as next week—to what was published after the first test of big banks in 2009. JFK Airport search of drug mule who said she was three months pregnant reveals she carried $20,000 worth of heroin (NYDN) Awoyemi, coming off an Air France flight from Paris to New York and wearing a “loose-fitting dress” was asked whether she was pregnant, and the woman replied that she was three months along, Homeland Security special agent John Moloney stated in a complaint filed in Brooklyn Federal Court. The customs inspector noted that Awoyemi appeared nervous, so she was selected for a pat-down search. After feeling a “bulge” in Awoyemi’s groin area, the situation escalated to a partial strip-search, according to the complaint. When she dropped her drawers, Awoyemi’s scheme fell apart. Pellets containing brown powder began dropping from her groin area — and the substance tested positive for heroin. Awoyemi was taken to a medical facility at the airport, where the federal cops administered a pregnancy test that came back negative. An X-ray showed more pellets in her intestinal tract, and by the end of the day she had passed about 25 pellets of heroin in a special commode that Customs officials have dubbed the “Drug Loo.” The high-tech toilet sanitizes the incriminating evidence. More On The Morgan Stanley Executive Charged in Cab Hate Crime Attack (Bloomberg) Jennings left a bank holiday party sometime before 11 p.m. and headed to the street, where he was supposed to be met by a car service, Jennings said. He hailed Ammar’s cab after the livery car didn’t appear, according to the report. Ammar said Jennings agreed on the fare and told him he would pay cash. Jennings fell asleep during the trip, the driver said. Once at the destination, though, Jennings said “he did not feel like paying” because he was already home, Ammar told police...When Ammar threatened to call the local police, Jennings said they wouldn’t do anything to help because he pays $10,000 in taxes, according to a report by the Darien police department...The Morgan Stanley executive told police he was afraid to come forward after the incident because the cab driver knew where he lived. He then went on vacation to Florida, police said. Jennings told officers he subsequently called his lawyer after a friend told him police were looking for a suspect in the stabbing incident, according to the report. JPMorgan Star To Launch Own Hedge Fund (FT) London-based Mike Stewart, JPMorgan’s global head of proprietary trading, and former head of emerging markets, is set to start his own new hedge fund, Whard Stewart, in the second quarter, people familiar with his plans said. Mr Stewart’s emerging markets trading team at the bank is expected to join him. The departures come despite word last week that US regulators will probably delay implementation of the so-called “Volcker rule” , under which banks are in effect banned from proprietary trading. Friends With Benefits (NYP) Unlike his fallen pal Raj Rajaratnam, former Goldman Sachs director Rajat Gupta appears to have no shortage of character witnesses willing to testify at his upcoming insider trading trial. Indeed, dozens of well-heeled supporters are already putting their names on the line for the former consulting titan, including world-renowned speaker Deepak Chopra and Mukesh Ambani, the ninth-richest man in the world. “I have never seen him ask for anything for himself, always for the greater good,” Ambani, the chairman of Reliance Industries, said recently on a little-noticed website called friendsofrajat.com. Cigarettes: The Most Stable International Currency (BusinessWeek) Cartons of Good Cat brand cigarettes are selling for as much as RMB5,600 (US$890) per carton in the city of Xi’an, in Shaanxi Province. The suspicion, according to reports this week, is that they are being used to bribe officials. Election Year Poses Challenge For Stocks (WSJ) The Dow is off to its best start to a year since 1998. But if history is a guide, this exuberance soon could give way to the first pangs of electoral anxiety. In a typical presidential-election year, stocks start well but slip into a funk by spring, according to Ned Davis Research, which has measured election-year trends back to 1900. At least in part, the slump reflects the electoral unknowns, Ned Davis has concluded. In a good year, investors deal with their jitters by late summer or early autumn and stocks recover. People get more comfortable with the November election outlook and put money back into stocks. This year, with the Dow Jones Industrial Average up 6.2% in just over two months, many investors and analysts expect a pullback soon. The looming election adds to ambient uncertainty about European debt and U.S. and Chinese growth prospects. Tony Welch, an analyst at Ned Davis Research, says the Dow could pull back 5% or 6% in the coming weeks. "We think the election-year trend could be strong this year," Mr. Welch says. "The market prefers certainty. It doesn't like unknowns." Ochocinco was urinated on by a lion and lived to tweet the tale (YS) The New England Patriots receiver was at a charity event in Miami on Saturday night when he ran into the caged animal. According to Ochocinco's Twitter account, the king of the jungle proceeded to become the urine sprayer at the party. Tweets included: "Swear to lil 10 pound bearded baby Jesus I just got peed on by a real "Lion" I'm not lying either. And y'all wonder why I don't go out!!!!!," "It's not funny i have on my good church clothes," and "I wasn't that close, he sprayed like a water gun."