Swamped

Summertime, and the livin' is easy. The NBA is through its first round of playoffs, there hasn't been a college board of a hundred games in over two months, and football is so far away that HBO still has a casting call out for Hard Knocks. Baseball's the main attraction, and baseball bettors are gentlemen and so old school the periodic table only has about 50 elements. How did we get here? It was one of those darkest-before-the-dawn moments, that moment that feels like it's darkest-before-it's-totally-black. I strolled in on the last day of the NBA regular season, a Thursday, fashionably late. He asked me where the hell I had been. I always show up late on summer Thursdays, and leave early. There's little baseball, and little else. But Faithful Assistant pointed to a screen and said “I'm fucking buried on the Wizards game”. The Washington Wizards are a bad basketball team. They were matched up against the Miami Heat, a very good basketball team. The Heat have LeBron James, Dwyane Wade, and that guy who Shaq said looks like Ru Paul. Except the market said the Heat didn't give a flying fuck about that game, and the Wizards were 8-point favorites. I asked him if maybe the Heat were the favorites. No, said Faithful Assistant, it was the Wizards. And our clients, all of whom fancy themselves smarter than the average bear, had bet $25K on the Wizards, -7.5, -8, -8.5, -9.5. So dump it, I said. We can lay off 50K with one phone call, usually more. “I can't. He's got jury duty.” What was this world coming to, bookmakers being summoned to sit on juries. So I told him to keep calling every half hour or so. In the meantime I'd handle any more Wizards bets myself. They kept calling for the Wizards. Over and over and over again. The market was -8, and I was dealing it -10 and getting buckets of abuse. “-10? Get outta here. ESPN says they're -8.” I quickly broke my clientele into two groups. The clients I didn't care about, I told them “OK, fine. Call up ESPN and give them your bet.” Some of them screamed. Several questioned my parentage. Most of them laid -10. My better clients got better treatment. I explained how the book was hopelessly one-sided and my layoff guy was “in court”. (I let them imagine he was the guy in the orange jumpsuit, not somebody who would be leaving by the front door.) I took their bet at -10, but told them that if and when my guy came through, I'd call them back and give them the -8. They thanked me like I was doing them a favor. Great. The first people who weren't angry all day. The pros called too. One nibbled on the Heat +8 at even money, but the rest passed. Court let out at 4:30. My guy didn't make the jury: something about his wife's job getting in the way. He took our bet for all we could eat at -7.5 and I started calling the clients back changing their -10 to not -8 but -7.5. People were thanking me as if I'd given them a kidney. Faithful Assistant's quick tally when the game tipped off saw him scream “We cannot lose!” I pointed out that while we would indeed win money, that wasn't the same as being invulnerable. For the sake of peace, love, and client happiness, we needed these lowly Wizards to win by a pile. Happy customers keep coming back, and there'd be no talk of conspiracies, fixed games off funny betting lines, and so on. The Wizards rolled. Up by 25 at half, they cruised to a 34-point win. The Heat played their B team all night. (The Tepid?) No LeBron, no Wade, no Ru Paul, no problem. The clients were ecstatic. One of them even sent us flash-frozen steaks. It's actually helped us change the summer baseball operation. Now when people call up looking for a team at such-and-such a price, if we don't have it and they're willing to leave the order open, we take the order and call them back when we fill it. A good client now calls us his “betting con-au-pairs”. I think he means “concierges”, but I don't speak French. Whatever. It's working out.
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Summertime, and the livin' is easy. The NBA is through its first round of playoffs, there hasn't been a college board of a hundred games in over two months, and football is so far away that HBO still has a casting call out for Hard Knocks. Baseball's the main attraction, and baseball bettors are gentlemen and so old school the periodic table only has about 50 elements.

How did we get here? It was one of those darkest-before-the-dawn moments, that moment that feels like it's darkest-before-it's-totally-black. I strolled in on the last day of the NBA regular season, a Thursday, fashionably late. He asked me where the hell I had been.

I always show up late on summer Thursdays, and leave early. There's little baseball, and little else. But Faithful Assistant pointed to a screen and said “I'm fucking buried on the Wizards game”.

The Washington Wizards are a bad basketball team. They were matched up against the Miami Heat, a very good basketball team. The Heat have LeBron James, Dwyane Wade, and that guy who Shaq said looks like Ru Paul. Except the market said the Heat didn't give a flying fuck about that game, and the Wizards were 8-point favorites.

I asked him if maybe the Heat were the favorites. No, said Faithful Assistant, it was the Wizards. And our clients, all of whom fancy themselves smarter than the average bear, had bet $25K on the Wizards, -7.5, -8, -8.5, -9.5.

So dump it, I said. We can lay off 50K with one phone call, usually more. “I can't. He's got jury duty.”

What was this world coming to, bookmakers being summoned to sit on juries. So I told him to keep calling every half hour or so. In the meantime I'd handle any more Wizards bets myself.

They kept calling for the Wizards. Over and over and over again. The market was -8, and I was dealing it -10 and getting buckets of abuse. “-10? Get outta here. ESPN says they're -8.” I quickly broke my clientele into two groups.

The clients I didn't care about, I told them “OK, fine. Call up ESPN and give them your bet.” Some of them screamed. Several questioned my parentage. Most of them laid -10.

My better clients got better treatment. I explained how the book was hopelessly one-sided and my layoff guy was “in court”. (I let them imagine he was the guy in the orange jumpsuit, not somebody who would be leaving by the front door.) I took their bet at -10, but told them that if and when my guy came through, I'd call them back and give them the -8. They thanked me like I was doing them a favor. Great. The first people who weren't angry all day.

The pros called too. One nibbled on the Heat +8 at even money, but the rest passed.

Court let out at 4:30. My guy didn't make the jury: something about his wife's job getting in the way. He took our bet for all we could eat at -7.5 and I started calling the clients back changing their -10 to not -8 but -7.5. People were thanking me as if I'd given them a kidney.

Faithful Assistant's quick tally when the game tipped off saw him scream “We cannot lose!”

I pointed out that while we would indeed win money, that wasn't the same as being invulnerable. For the sake of peace, love, and client happiness, we needed these lowly Wizards to win by a pile. Happy customers keep coming back, and there'd be no talk of conspiracies, fixed games off funny betting lines, and so on.

The Wizards rolled. Up by 25 at half, they cruised to a 34-point win. The Heat played their B team all night. (The Tepid?) No LeBron, no Wade, no Ru Paul, no problem. The clients were ecstatic. One of them even sent us flash-frozen steaks.

It's actually helped us change the summer baseball operation. Now when people call up looking for a team at such-and-such a price, if we don't have it and they're willing to leave the order open, we take the order and call them back when we fill it. A good client now calls us his “betting con-au-pairs”. I think he means “concierges”, but I don't speak French. Whatever. It's working out.

Related

Maddeningly Bad Luck

March Madness has been a disaster: two of my best customers, who know each other, combined to go 2-for-39 on the first two weekends. Faithful Assistant has been laughing at their tought breaks, but I've been trying to soothe them. I need these guys to keep playing, losing, and paying. Their luck really has been atrocious. 18 of the losses have been by three points or less. One of them asked me if I'd ever heard anything worse. I guess there's Tsotomu Yamaguchi. Yamaguchi was on a business trip in Hiroshima when the A-bomb dropped. Wounded, he figured he'd better get out of Dodge ASAP, so he barrelled home the next day – to Nagasaki. I reminded the client that his bad luck paled in comparison to Yamaguchi's, and that Yamaguchi lived another 65 healthy years...plenty of time to make more bets. But now I'm dealing with more than bad luck. These guys have now declared that sports are rigged. This month's point-shaving scandal at Auburn hasn't helped, and it brings others of recent years to mind. The NBA has Tim Donaghy. Overseas, it looks like half the Turkish soccer league is going to jail, and half of Italy has already been. I actually believe that most of sports are on the level. Disagree if you want, that's OK. But what really gets my goat are the people who think the bookies want the games rigged. We don't. If people think the games are fixed, and thus become afraid to bet, I'm out of business. It's the same story for the guy running a poker game or the CEO of a retail brokerage. No faith, no business. There's a really simple reason somebody with the available cash or credit can get down a $500,000 bet on the NFL, but might not be able to easily bet $50 on Wrestlemania: the market can take the $500,000 football bet, adjust the price slightly, and bettors will come for the other side. There is no market for Wrestlemania, because nobody trusts it. So these clients are generally miffed, but also fixated on one game: Syracuse vs. Kansas State. The price started moving 20 minutes before tip when a K-State star was ruled ineligible. These guys took the new price on K-State thinking they got a deal, when it was just the market reacting to information. Well, Syracuse rolled and now it's allegedly a “fix”. Of course it's not a fix—it's just betting dumb with less info than everybody else. They should have checked why the spread was moving. Emotion trumps reason, though, and there was no reasoning with these guys. And maybe that's why these guys bet with me instead of going online somewhere—they're so Old School, the building probably only had one room. If you want to be a pro gambler these days, there's a ton of free information all over the Internet. I'm not saying it's easy to win over time—it's not. But there's a bucket of info out there on any game you want to study, and all sorts of arcane stats to help inform your decisions. And since everyone else is studying, you better too. When I worked in Chicago, we had a good customer who worked at O'Hare. He would bring us out-of-town sports sections that travellers left behind as they boarded planes. We got useful injury information from beat writers in other cities that the rest of the Chicago market just didn't have. That was 20 years ago, but when I tell that story to Faithful Assistant, he usually asks if Orville and Wilbur Wright were flying the planes. He's been on the Internet since middle school, and pretends he can't remember life without it. So I'm not sure what to do with these guys—they bet six times a day, but haven't called since Saturday. I think I'll give them a free bet equivalent to what they lost on Kansas State. I know I don't have to, but I'm not willing to risk losing the business. That's the worst part of all this—and the reason why I'm trying to get out of this racket. I don't just need the customers to lose, I need them to lose slowly and have fun doing it. I'm not a psychiatrist trained to actually convince people that betting really is a random thing for the vast majority of gamblers and losing streaks just happen. I wonder if I should join the Army. I'm not much for getting shot, but I hear the poker games are good. Baseball starts next week and the guys who just bet bases are much easier to deal with. They understand the nature of a game where the very best teams win 65% of their games and the absolute worst teams still win 35% of the time. I can't wait. Anybody know if Tim Tebow needs someone to take his action? He's on every channel, everywhere.

Bookie Confessional, Early Baseball Edition

Mike is my best baseball client. He bets three or four grand a night, spread out over the whole card. He can't possibly win over time. Sadly, such golden geese occasionally shit on the lawn. That's what Mike did Friday, when he called and asked me to give him another bookie's number. Nobody in particular—just anybody's. He wanted a second place to bet. Basically he was sitting at his regular table and asking the Maitre d' where ELSE he should go to dinner. I told him to call me back Saturday. Well, I fumed awhile, then it came to me. Mike had rarely talked to Faithful Assistant. I summoned Faithful Assistant and told him his dreams were about to come true: he was opening his own shop, with exactly one disposable cell phone, and exactly one very good customer. Turns out that wasn't Faithful Assistant's dream. His dream involves some newly single woman with expensive tastes: the weasel told me that if he was going to play this charade it was going to cost me a full 15% of Mike's losses on both phone numbers. I was outraged and we started negotiating and by the time we were done 15% had become 20%. After making a mental note never to negotiate with Faithful Assistant again, I picked up the phone to hire the new book's collection agent. Melody, a good customer's wife, asked me for a job a couple months back. I offered and she accepted this part-time gig as an audition. Mike had his new place to play, Faithful Assistant was angling for a raise to 30%, and I set up a Monday meeting with Melody to tell her how all this would go down. Melody was a quick study. Faithful Assistant was her boss-and-contact and she was supposed to pass by Mike's office every Tuesday afternoon to pay or collect. She wanted to know what to do if Mike didn't have the money. She was disappointed to learn she should do nothing, just call us. I don't think she wanted to break his legs, but I think she wanted to give him a serious telling off, preferably in front of people. Too bad—that's not the way it works. It's a non-issue anyway: Mike pays. Turns out the 20% I'm paying Faithful Assistant is money well spent: he quickly put together that Mike is betting the same teams with both our places. That might be the stupidest piece of betting I've ever laid my eyes on. He calls one number, bets the Yanks, then calls the second number and bets the Yanks again. His second price is almost always worse—how much worse, well, it depends on how greedy we feel. There is no logic to this—he ought to put his whole bet in at the first place he calls, or better yet call both joints for prices and put the bet in at the shop with the better price. (Faithful Assistant is routinely varying prices on the Mike Phone by a penny or two anyway.) The only way Mike's current plan would make sense is if Mike was putting in maximum sized bets and needed to get down two max bets whatever the cost – but that's not happening: Mike's just putting down a few hundred at each place. Aspiring MBA-er Faithful Assistant says that Mike is trying to spread out his “credit risk," so that if one shop goes bust owing him money, he still has the other. Our shenanigans aside, that helps Mike little: If you think your bookie can't pay, don't spread out your risk—just stop calling him and find someone else you're actually comfortable with. It's a bookie joint, not a bank. So we were a little surprised about this but the final shock was Melody's. Melody showed up on Tuesday at Mike's office to pick up $600. She won't have to bother going downtown anymore: She knows “Mike” well: their kids are best friends since they've been neighbors for nine years.

Football? Yep. Oscars? OK. The VIX? Really?

I was scoring up the Super Bowl (small loss) when Ocean called. Ocean is a good customer. He had a couple questions, and I told him fire away. First he wanted to know if we were doing the Oscars again this year. Of course we are. I'm not thrilled about it –I'm half paranoid about inside information bubbling on the Internet, but I'm learning to embrace the inside mis-information. Most importantly, we do it as a service, so the customers won't start betting online with bookies in Costa Rica. Ocean was pleased. For what it's worth, he likes The Artist at very short odds. He watches rom-coms. With his wife, he says. His favourite movie though is Love Story, and he cries shamelessly every time he watches it: he truly believes that love means never having to say you're sorry. I've never figured that out. I'm forever apologizing to my wife for doing boneheaded things and saying stupid shit. And apologizing is a necessity But whatever. A happy customer is a beautiful thing. And I thought the phone call was over. And then Ocean said it. “What do you have on the VIX for this summer?” I asked him what the hell he was talking about because I didn't compute what I was hearing. He then said how he had been watching CNBC. He went to his mutual fund guy determined to buy the VIX, and the salesman blew him off with “Oh, that's just gambling”. So, hey, I must surely book the VIX, right, because I take bets from gamblers? Well I totally had my pants down and started mumbling about monthly contracts and the need to be a sophisticated investor and how there were a few products out there and...he cut me off. He understood how “the 1% were trying to make this complicated” and he just wanted a near-even-money type bet that the VIX would be over 30 at the end of June, as per the top of the screen on CNBC. I gave him the bet. 30's a pretty big number, and I figure this'll make me learn about trading the VIX instruments so I can lay it off if I want to. (I've never done anything more sophisticated than buy a put spread when I was afraid of a downturn. Go ahead, laugh.) 30's a lot. So I let him have it at 6-to-5. He was only expecting even money or slightly worse, so he was pleased. Ten minutes later I was using this episode as an object lesson for my Faithful Assistant, a guy who is muddling through an MBA while living in his parents' basement. Garage loft, I stand corrected. Anyway, good customers need to be kept happy, good customers lose, and happy customers pay. The Hollywood-movie days of kneecapping customers who stiff you were over before I was born, if they ever even existed, and—and the phone rang again. Ocean again, wanting an over/under number on where Apple would be in a couple months' time. Oh, and Facebook. I told him I would have to call him back. I started throwing coffee cups and in between my screams my Faithful Assistant told me he'd just pretend I have Tourette's. He's cold. Then he asked me what was going on. And after I told him, he smiled, and tried to give his boss an object lesson of his own: “This is great. You trade the odd option. All my electives are Finance. We just set the over-under price, I mean you KNOW he's going 'over', high enough that we can buy calls a couple strikes below that number. We use his bet to buy the calls, if he wins we clean up, and we're covered.” And when I asked what would happen to Ocean's bankroll over time, the answer came back that we would sodomize it. I just shook my head. My young friend may well end up in a business career where the necessary m.o. is to grab-it-all and grab-it-now, but that's not how my business works. I actually want my customers to win 45-50% of their bets, lose fairly small amounts over time, and never lose so much in one fell swoop that they can't pay or that they decide to stop playing. There's a purpose behind all that languid ritual at the Baccarat table in the high-limit room at the casino: try to keep the House's earn slow-and-steady. It makes the news when a whale beats Vegas for $10 million, or drops $10 million, but the casinos tolerate those lumpy earnings—aside from a little ink, they don't really want them. The casinos want everybody playing dollar-slots, losing three cents a spin. His eyes kind of glazed over, so I thought, what would Suze Orman do to get her point across? I figured Suze, to make the young'uns understand, would probably Go Gangsta. So I said “Look, we make money by drawing blood from our customers.” His eyes lit up as I continued: “We're blood collectors. We need a nice orderly blood bank. What you're proposing, is a drive-by.” (Well, I actually said “drive-thru”, but we sorted it out after a little confusion.) So we've told Ocean that these bets are going to be for peanuts and we're going to have fun with them. He's on board, and he's all excited. Faithful Assistant is going to make the numbers and I told Ocean to give us some requests for stocks he thought would go lower. “Oh you mean I could bet 'under' too? Not just 'over'?” Yep, 'under' too. February's a shit month in the bookie biz—the regulars are there, but football's over and it's a ways before March Madness. Ocean's stockpicking is going to keep me interested.

I Sell Cardboard Boxes For A Living

Excuse my agitation. It's rare I get a Friday night off. Such evenings go to shit when I'm at a party and I get introduced by my real profession. Can you imagine introducing casual acquaintances at a party with “Yeah, so this is Jimmy. He's a meth dealer”? I don't know, maybe you can. In which case I don't really want to be invited to your parties. As for me, left to my own devices, I tell people I'm a cardboard box salesman. That suits me nicely. Nothing against people who sell cardboard boxes: I've never actually met one. But when I tell people that's what I do, nobody ever asks me to elaborate on my workday. It's actually a backstory I stole from another bookie—a guy who always had an identity or two to spare along with a great mind and approach to the profession. I started by telling people I was an electricity meter reader, and then once some guy asked me “isn't that all done by computer now?” and I had that So-Totally-Busted look on my face. So my colleague got me into the cardboard box business, which never goes out of style by always being precisely out of style. So this time I got introduced as The Bookie and my head immediately starts scanning the room for Feds. I've watched all the movies—I'm looking at everybody's shoes, looking for G-man wingtips. No immediately suspicious footwear—and no way out as the crowd starts circling me asking me all the Usual Questions. No, I don't break people's kneecaps. No, I don't lend people money at 1% a week. No, I don't fix games or know more about sports than anybody else. It was turning into one of those Wizard of Oz moments: I'm just the old, fat guy behind the curtain, which suits me, when I was asked a question I felt the need to rant on: How come I'm living in he shadows here when I could be living large in Costa Rica? Believe it or not, I'm safer here. The US government is this two-headed beast. One head wants to raise tax revenues by legalizing more gambling. Whoops, “gaming”. If it's legal, it's no longer gambling, it's “gaming." That's not quite as Orwellian as “collateral damage” (dead civilians), but it still makes me smile bitterly. The government's other head is trying to shut down the offshore industry. Poker sites, online casinos, sports books—it's all in the crosshairs. And they're rounding up anybody on The List who sets foot in the Good Old USA. When that doesn't work, they try extraditing people, from everywhere. Costa Rica, Canada, the UK, Antigua, wherever. The extradition policy is the worst of it. Consider Bob Eremian. His client base was mostly Southern New England, with a little NYC and Jersey thrown in. He moved his operation to Antigua in the mid 90s, figuring that even if what he was doing in the US was illegal (the trial of Jay Cohen showed it would be), since it was legal in Antigua, he couldn't be extradited. That's a key part of extradition law, I'm told: what you're doing has to be illegal in both jurisdictions. Except Uncle Sam didn't come after Bob for making book, just like how he didn't actually go after Martha Stewart for insider trading per se. The Eremian charges were money laundry, tax evasion, and so on—things that were illegal in Antigua. 11 years after he was originally deported, the civil cases just kept coming. The US government's current instrument of choice is the Unlawful Internet Gaming Enforcement Act. It was tacked onto a bill about port safety. Honest. Life is too short. So I'm onshore and offline. Any trouble I'm going to get from the Law is going to be local. If caught, I'll spend some time doing graffiti removal or cleaning up a park. I'll sleep in my own bed. I don't need 16 hours a day in front of a computer screen trying to move my numbers faster than internet wiseguys can pick me off. I don't need to try to figure out Costa Rica's ever changing tax code. (When I left, sports books were charged, among other things, $1000 per computer monitor on the premises, per year.) I don't need to court the DOJ's wrath. But I still don't need my cover blown at parties. I sell cardboard boxes, period. It didn't help that a very good customer and his wife, my new part-time employee, were in the room making faces at me to see if they could get me to crack up or soil myself as I took questions. If the rant hadn't gotten me four new customers, the night would have been a total bust.

Opening Bell: 01.10.13

Deutsche Profits Big On Libor Bets (WSJ) Deutsche Bank made at least €500 million ($654 million) in profit in 2008 from trades pegged to the interest rates under investigation by regulators world-wide, internal bank documents show. The German bank's trading profits resulted from billions of euros in bets related to the London interbank offered rate, or Libor, and other global benchmark rates. ECB Stands Pat On Rates (WSJ) The ECB's Governing Council decided to keep Europe's most important interest rates at their lowest levels since the single currency was introduced in 1999, encouraged by a clear improvement in financial-market sentiment over the past month and by tentative signs of growing confidence in the euro-zone economy. Rivals Clash As Inquiry Into Herbalife Opens (WSJ) Daniel Loeb's hedge fund disclosed Wednesday it owns an 8.2% stake now valued at $350 million in nutrition-supplements company Herbalife Ltd. Mr. Ackman's Pershing Square Capital Management LP has bet more than $1 billion against the company by shorting its stock…The face-off between two high-profile, media-savvy hedge-fund managers highlights the arrival of a new wave of postcrisis financial stars. They tout their positions during television interviews and at conferences, in letters or securities filings and on customized Web pages, often convincing other investors to follow their lead. Their pronouncements move stocks, at times dramatically, and leave companies scrambling to respond. And when they take the opposite sides of the same trade the ensuing battle can captivate the financial world. "One of them is going to be very wrong," said Gregg Hymowitz, founder of the $8.2 billion EnTrust Capital, a longtime investor with both Mr. Ackman and Mr. Loeb's firms. "Ackman thinks it's a complete and utter fraud, and Dan thinks it's a completely legitimate business." Hedgie's Herbalife Bet Counters Ackman (NYP) [In addition to Loeb], Carl Icahn is also believed to have taken a long position in Herbalife, sources said. The possibility of Loeb and Icahn going up against Ackman’s Herbalife short sent investors into a tizzy. “It’s going to be an Ackman sandwich,” one hedge fund manager wailed. Lew Taking Over at Treasury Puts Perennial Aide at Head (Bloomberg) With his penchant for thinking several steps ahead, his organizational drive and his budget expertise, Lew, 57, has been Obama’s consummate aide. Now, he’s Obama’s choice for Treasury secretary, according to a person familiar with the process. Lew faces the prospect of becoming a leader at a critical juncture for the nation’s economic and fiscal future. “As chief of staff you are staff and as Treasury secretary, you are principal -- Jack has to make that transition,” said Ken Duberstein, a chief of staff to former President Ronald Reagan who first met Lew in the 1980s. “It’s not the invisible hand, it is the visible hand.” If confirmed, Lew may need to play that hand as soon as next month, when the administration squares off with Congress over the U.S. debt ceiling. Lew’s job will be all the more difficult because his relations with House Republicans soured during the 2011 battle over the government’s borrowing limit. Government's worst signature will be on America's dollar bills (NYP) Lew’s signature — which looks like a strand of hair gone though a curler treatment — might even be too peculiar to grace our greenbacks, political insiders said. “Whoa! That’s completely unintelligible,” said a Senate finance aide. “This doesn’t look like anyone’s name at all.” She concluded, “Oh my gosh — I’ve never seen a signature like that.” ome social-media users were also quick to poke fun, saying Lew should clean up his squiggle. “HE GOT A CRIZZAZY SIGNATURE!!!!” one Twitter user wrote. Another tweeter quipped, “Looooooo!” But just because his autograph looks it’s penned by a drunken 3-year-old doesn’t mean it isn’t lovable, others said. Some fans created a petition on the White House’s Web site called “Save the Lewpty-Lew!” “We demand Lew’s doodle on every dollar bill in circulation,” the petition read. It had garnered 10 signatures by late yesterday…Asked yesterday if Lew had been practicing to improve his signature, presidential press secretary Jay Carney, said, “Not that I’m aware of.” Cantor Growth Plan Sputters as 41% of Touted Hires Exit (Bloomberg) Chief Executive Officer Howard Lutnick’s drive to turn one of the largest independent U.S. brokerages into a rival to Wall Street’s investment banks has been pocked with dismissals and defections. Forty-one percent of the 158 traders and bankers whose hirings Cantor announced in news releases since 2009 have left, industry records show. In interviews, 19 current and former employees blamed Cantor’s reluctance to commit money to deals and pressure to turn immediate profits. Norfolk 911 calls for 'baby lion' turn up a coiffed dog (HR) The first caller was fairly calm. “I’d like to report a lion sighting,” he said. “Say that again?” a dispatcher responded. And thus began the drama over baby lion sightings in Norfolk on Tuesday. Police said Wednesday that they actually got three 911 calls about the “lion.” The first came at 10:19 a.m. The animal was running on Granby Street, a male voice said. Then a woman took the phone. She sounded anxious as she described the proximity to the zoo. “There was a lion that ran across the street. A baby lion. It was about the size of a Labrador retriever.” It was near Granby and 38th, she said. “It’s roaming loose in the neighborhood.” A second call came five minutes later. “I just saw an animal that looked like a small lion.” It had “the mange and everything,” a man said. He had seen it on Delaware Avenue near Llewellyn Avenue. “I don’t know if it got away from the zoo, or what,” he said. The dispatcher said they already had received a report. “I’m not sure if it actually is a lion or not, but I’ll update the information.” A third call came at 1:19 p.m. “I just saw a baby lion at Colley Avenue and 50th Street,” a man reported. “What kind of animal?” the dispatcher later asked him. “A lion. A baby lion, maybe.” The lion was going to nearby houses. “I don’t think it has caused any problem so far,” said the caller. “OK. You think it’s looking for food?” the dispatcher asked. “I don’t know.” By now, most folks know that the “baby lion” was actually Charles the Monarch, a Labrador-poodle mix owned by Daniel Painter, who lives in Riveriew and has a garden center on Colley Avenue. He has the dog groomed to look like the Old Dominion University mascot. Many people say they see Charles out a lot, especially on Colley. But to someone who hasn’t seen him, he sure doesn’t look like a dog at first. PE King Black Is Hungry For Hostess (NYP) Black’s Apollo Global Management has teamed with veteran food executive C. Dean Metropoulos on a potential bid for bankrupt Hostess Brands’ snacks business, which includes Twinkies, Ding Dongs and Ho Hos…Hostess is in the process of selling off its iconic brands and liquidating the company after a crippling strike by its bakers union forced it to shut down in November. The Irving, Texas-based company plans to hold separate auctions for its bread and snack businesses. Hostess is just a few days away from choosing a so-called stalking horse bidder for its bread brands, including Wonder Bread, Nature’s Pride and Butternut. The snack business will follow suit later. Mortgage Deals Came Just In Time (WSJ) Major banks pushed to complete an $8.5 billion legal settlement with federal regulators this past weekend so they could book the deal's costs in their fourth-quarter results and present a cleaner slate to investors in 2013, according to people familiar with the talks. The timing of the settlement of alleged foreclosure abuses, announced Monday, allowed banks including Bank of America, JPMorgan, Citigroup, and Wells Fargo to take advantage of so-called subsequent-events accounting. The same rules apply to Bank of America's $11.6 billion pact with Fannie Mae over buybacks of questionable mortgage loans. Monday's settlements are "almost the textbook example" of when subsequent-events accounting comes into play, said Robert Willens, an accounting and tax expert. Obama’s 81% New York City Support is Best in 114 Years (Bloomberg) President Barack Obama won more support from New York City in November’s election than any White House candidate in more than 100 years, according to a final tally of votes. Obama beat Republican challenger Mitt Romney by 81 percent to 18 percent in the nation’s largest city, according to a certified vote count released Dec. 31 by the state board of elections. Some New York ballots were counted late in part because of complications caused by Hurricane Sandy. Yum Brands Apologizes For Chicken Probe (WSJ) Yum Brands's China chief executive apologized to consumers after negative publicity surrounding an official probe into chicken purchased from local suppliers caused sales to tumble at the company's KFC chain. Yum failed to address problems quickly and had poor internal communications, Sam Su said in a statement posted on the company's official account on Sina Corp.'s Twitter-like Weibo microblog service. He said the company would strengthen its management and oversight of suppliers. "We feel regretful for all the problems," Mr. Su said in the statement. "I sincerely apologize to the public on behalf of the company." Swiss Banks Welcome Rejection of Germany Tax Accord, Study Shows (Bloomberg) Swiss banks welcome the collapse of an accord with Germany that would have imposed new taxes on German clients in a bid to end a dispute over tax evasion, Ernst & Young said. About 72 percent of 120 Swiss banks surveyed see the demise of the agreement as positive, Ernst & Young said in a report today. How Jawboning Works (WSJ) The clearest example comes from Europe. In July, Mario Draghi, president of the European Central Bank, defused an intensifying crisis of confidence in the euro with two sentences scribbled in the margins of an otherwise routine speech. "Within our mandate, the ECB is ready to do whatever it takes to preserve the euro," he said. "And believe me, it will be enough." That may prove to be the most successful central-bank verbal intervention in history. A few weeks later, the ECB pledged to buy bonds of governments shunned by markets if those governments made belt-tightening commitments accepted by fellow euro-zone countries. No government has sought that help so the ECB hasn't spent a single euro. Yet global anxiety about an imminent euro crisis has abated. Beautiful Existence, Seattle Woman, Plans To Eat Only Starbucks For One Year (HP) A Seattle woman, legally named Beautiful Existence, will eat only food from Starbucks this year. She'll also be only drinking beverages from Starbucks as well, but will include drinks from Tazo Tea and Evolution Fresh since both fall under the Starbucks brand. Beautiful Existence cites several reasons for this endeavor. She explains them on her blog: "So how can eating only one company’s products impact me, anybody? Well Mr. McDonald’s already proved that question years ago with his documentary and Mr. Subway did his take on the loosing weight portion of the food challenges too. But when I watched those guys doing their thing I asked myself “where are the WOMEN challenging themselves in the world?” “Where are the effects being shown on a woman’s culture? A woman’s family & children? A woman’s diet, weight, fashion, checkbook, community and world through challenges?” “Where is HER VOICE on how an international company is directly or indirectly impacting everything from her waistline to her bottom line and every other woman’s, man’s, child’s, societies and planets world with their presence?” So far, Existence has really liked the Turkey Rustico Panini and is trying hard not to eat any of the baked items.

Opening Bell: 04.13.12

JPMorgan Profit Slips (WSJ) J.P. Morgan reported a profit of $5.38 billion, down from $5.56 billion a year earlier. On a per-share basis, earnings were $1.31, up from $1.28 as the share count outstanding declined. The latest quarter included a net 8-cent per-share loss tied to litigation expenses and changes in the value of the bank's debt. Analysts polled by Thomson Reuters expected a per-share profit of $1.18, excluding debt-related charges. Revenue rose 6.3% to $27.42 billion. Analysts were looking for $24.68 billion. Wells Fargo reports higher first-quarter profit (Reuters) Wells Fargo, the nation's fourth-biggest U.S. bank, said net income was $4.25 billion, or 75 cents a share, in the quarter, compared with $3.76 billion, or 67 cents, a share in the same period a year earlier. The average estimate from analysts was 73 cents per share. JPMorgan Said to Transform Treasury to Prop Trading (Bloomberg) Achilles Macris, hired in 2006 as the CIO’s top executive in London, led an expansion into corporate and mortgage-debt investments with a mandate to generate profits for the New York- based bank, three of the former employees said. Dimon, 56, closely supervised the shift from the CIO’s previous focus on protecting JPMorgan from risks inherent in its banking business, such as interest-rate and currency movements, they said. Some of Macris’s bets are now so large that JPMorgan probably can’t unwind them without losing money or roiling financial markets, the former executives said, based on knowledge gleaned from people inside the bank and dealers at other firms. Bank Bonus That Tops Salary May Be Banned by EU Lawmakers (Bloomberg) Governments and lawmakers in the 27-nation EU are considering rules for lenders that would go far beyond international agreements approved by the Basel Committee on Banking Supervision. Denmark, which holds the rotating presidency of the EU, has proposed empowering nations to set surcharges of up to 3 percent across their banking systems. Karas yesterday suggested adding language to the legislation that would ban banker bonuses that exceed fixed pay, following calls from other lawmakers to rein in excessive compensation. IMF Lifts Growth Forecast, Cautiously (WSJ) Christine Lagarde, managing director of the International Monetary Fund, said the world economy is marked by "a high degree of instability" even though prospects for global growth are better than they were a few months ago. In an interview with The Wall Street Journal, Ms. Lagarde said the IMF, which marked down its 2012 forecast for global growth in January to 3.3%, has now marked it up to reflect improving conditions in the world economy. But she said the new forecast, to be released next week, remains more pessimistic than the one it made last September, which predicted 4% growth. Europe remains the biggest single risk to the global economy, the former French finance minister said. Hedge Fund Driver Guns DownArmed Robber (NYP) A retired NYPD lieutenant blew away a drugstore bandit yesterday as the suspect tried to gun down three police officers during a foot pursuit, sources said. Thomas Barnes, Barnes — a driver for hedge fund manager Philippe Laffont, was filling his tank at the BP station on East 119th Street and First Avenue at around 11 a.m. when he saw gunman Rudolph Wyatt running from the store, and sprang into action. He crouched behind his hedge-fund boss’ Mercedes SUV and squeezed off three shots, killing Wyatt, 23. The trigger-happy thug — wanted on warrants for two other shootings — lay dead in a pool of blood on the sidewalk wearing a black stocking mask with a wad of stolen cash spilling out of his pocket, witnesses said. “Part of the back of his head was missing. He had a large head wound and there was tons of blood,” said witness John Brecevich, 59, owner of the Original Patsy’s restaurant nearby. “It was a scene straight out of NYPD Blue.” Trustees Aim For MF Execs (NYP) The trustee tasked with clawing back money for burned customers of MF Global is training his sights on the brokerage firm’s executives — a list that likely includes former CEO Jon Corzine. In a statement yesterday, trustee James Giddens said he is considering pursuing claims against “certain responsible individuals” who worked for MF at the time customers’ trading accounts were improperly tapped. Kent Jarrell, a spokesman for Giddens, declined to name names but said the trustee is considering civil suits against “officers, directors or other employees” of both the brokerage firm and the holding company. Fed Officials Differ on Need to Keep Rates Low to 2014 (Bloomberg) William C. Dudley, president of the New York Fed, and Vice Chairman Janet Yellen said the 2014 time-frame is needed to lower unemployment from 8.2 percent. Minneapolis Fed President Narayana Kocherlakota said rising inflation may prompt an interest-rate increase as early as this year, while Philadelphia’s Charles Plosser said policy should hinge on economic performance, not a calendar commitment. Newark Mayor Cory Booker: Race into home fire was a "come to Jesus moment" (CBS) Booker arrived home last night to discover his next-door neighbor's house on fire, and rescued a young woman trapped upstairs by carrying here through the flames, suffering second-degree burns in the process. The mayor's security team discovered the fire and pounded on the door to alert residents, when an elderly woman said that her daughter was trapped upstairs. At first, Newark Police Detective Alex Rodriguez would not let Booker into the burning house. "He basically told me, 'This woman is going to die if we don't help her,' and what can I say to that?," Rodriguez said. "I let him go and without thinking twice, he just ran into the flames and rescued this young lady." Booker said that as he jumped through the kitchen on the second floor, "I actually wasn't thinking. When I got there and couldn't find her in all the smoke, looked behind me and saw the kitchen really erupting with flames all over the ceiling, that's when I had very clear thoughts that I'm not going to get out of this place alive and got ... very religious. He admitted he was "not gentle" with her - "I just sort of threw her over my shoulder and dragged her through the kitchen."

Opening Bell: 02.05.13

Barclays CEO Vows To Improve Bank's Ethics (WSJ) Chief Executive Antony Jenkins said Tuesday he is "shredding" the legacy of the bank's self-serving culture by improving its ethics and moving beyond the misconduct issues that have cost it billions of pounds. Mr. Jenkins told a U.K. parliamentary group that his efforts so far include changing the way employee bonuses are calculated and abolishing commissions on financial-product sales. He said the changes would take time to produce results, but that ultimately he wants to eliminate a culture that at times has been "too short-term focused, too aggressive and on occasions, too self-serving." "Our resolve and intent behind this is absolute," Mr. Jenkins said. McGraw-Hill, S&P Sued by U.S. Over Mortgage-Bond Ratings (Bloomberg) The U.S. Justice Department filed a complaint Monday in federal court in Los Angeles, accusing McGraw-Hill and S&P of mail fraud, wire fraud and financial institutions fraud. Under the Financial Institutions Reform, Recovery and Enforcement Act of 1989, the U.S. seeks civil penalties that can be as high as $1.1 million for each violation. Earlier today, the company’s shares tumbled the most in 25 years when it said it expected the lawsuit, the first federal case against a ratings firm for grades related to the credit crisis. “It’s a new use of this statute,” Claire Hill, a law professor at the University of Minnesota who has written about the ratings firms, said in a phone interview today from Minneapolis. “This is not a line to my knowledge that has been taken before.” Dell Nears $25 Billion Deal To Go Private (WSJ) Late Monday, Mr. Dell was in talks with Microsoft Corp and private-equity firm Silver Lake Partners to offer shareholders between $13.50 and $13.75 a share, said people familiar with the matter, about a 25% premium to Dell's stock price in January before the possibility of a deal became public. The buyout, if approved by shareholders, would be the largest such deal since the financial crisis. It also would be an admission by Mr. Dell that he wasn't able to pull off the changes needed to improve his company's revenue and profit under Wall Street's glare. The buyout would give Mr. Dell the largest stake in the company, ensuring that the 47-year-old is the one who gets to oversee any changes. Gross: Beware 'Credit Supernova' Looming Ahead (CNBC) The head of the Pacific Investment Management bond giant has issued an ominous forecast in which he worries that the global central bank-induced credit bubble "is running out of energy and time." As a result, investors will have to get used to an atmosphere of diminishing returns and portfolios that will hold more hard assets like commodities and fewer less-tangible financial assets like stocks. "Our credit-based financial markets and the economy it supports are levered, fragile and increasingly entropic," Gross said in his February newsletter. Obama to Meet With CEOs of Goldman, Yahoo, Other Firms (Reuters) President Barack Obama will meet with chief executives from 12 companies including Goldman Sachs Group's Lloyd Blankfein and Yahoo's Marissa Mayer on Tuesday to discuss immigration and deficit reduction, according to a White House official. "The president will continue his engagement with outside leaders on a number of issues, including immigration reform and how it fits into his broader economic agenda, and his efforts to achieve balanced deficit reduction," the official said Monday. Other chief executives include Arne Sorenson of Marriott International, Jeff Smisek of United Continental Holdings, and Klaus Kleinfeld of Alcoa. A Billion-Dollar Club And Not So Exclusive (NYT) an unprecedented number of high technology start-ups, easily 25 and possibly exceeding 40, are valued at $1 billion or more. Many employees are quietly getting rich, or at least building a big cushion against a crash, as they sell shares to outside investors. Airbnb, Pinterest, SurveyMonkey and Spotify are among the better-known privately held companies that have reached $1 billion. But many more with less familiar names, including Box, Violin Memory and Zscaler, are selling services to other companies. “A year from now that might be 100,” said Jim Goetz, a partner at Sequoia Capital, a venture capital business. Sequoia counts a dozen such companies in its portfolio. It is part of what he calls “a permanent change” in the way people are building their companies and financers are pushing up values. The owners of these companies say the valuations make them giddy, but also create unease. Once $1 billion was a milestone, now it is also a millstone. Bigger expectations must be managed and greater uncertainty looms. Donald Trump to sue Bill Maher after bet feud (Politico) Donald Trump filed a lawsuit Monday in California against liberal comic Bill Maher, suing him for $5 million after Trump says Maher did not follow through on a $5 million public bet he made on “The Tonight Show.” “I don’t know whether this case will be won or lost, but I felt a major obligation to bring it on behalf of the charities,” Trump said in a public statement first obtained by POLITICO. Last month, Maher said on NBC to Jay Leno that he would pay $5 million to Trump’s charity of choice if he provided a birth certificate proving that he’s not “spawn of his mother having sex with orangutan.” It was similar to an offer Trump made to President Barack Obama during the presidential campaign season, in which Trump wanted Obama to release his college records. Trump’s statement continued: “Bill Maher made an unconditional offer while offer while on The Jay Leno Show and I, without hesitation, accepted his offer and provided him with the appropriate documentation. Money-Market Funds Best By Excess Cash (WSJ) Money-market funds have a high-quality problem: investors are entrusting them with too much cash. The flood of money is prompting the funds, which buy short-term, top-rated debt, to seek higher returns in investments that until recently were seen as too risky, including French bank debt. Investors plowed $149 billion into U.S.-based money-market funds between the start of November and Jan. 30, bringing total assets under management to $2.695 trillion, close to the most since mid-2011, according to the Investment Company Institute. Knight Capital Group to Cut Workforce by 5 Percent (Reuters) Knight Capital, which recently agreed to be bought for $1.4 billion by Getco, will lay off 5 percent of its global workforce as part of efforts to restructure the automated trading firm, according to a regulatory filing released on Monday. FTC Corrects Language On Herbalife (NYP) The Federal Trade Commission yesterday corrected an earlier statement regarding a “law enforcement investigation” into Herbalife. In response to a Freedom of Information Act request by The Post, the FTC said some complaints against the company were withheld because the information was “obtained through a law enforcement investigation.” The agency said yesterday that the language in its letter accompanying the FOIA request was incorrect and it should have said that the exemption from disclosure was related to “foreign sources.” FTC spokesman Frank Dorman defined “foreign sources” as government entities, including law enforcement agencies, and the exemption relates to information-sharing between the FTC and these foreign government agencies. The FTC said that it “may not disclose any material reflecting a consumer complaint obtained from a foreign source if that foreign source has requested confidential information.” The agency said it could not confirm, or deny, an investigation into the nutritional supplements company. Hedge Fund Mogul, Swiss Villagers Clash Over Ski Slopes (Bloomberg) Since hotelier Tobias Zurbriggen can remember, the business of running Saas-Fee has been a local affair. Now, the Swiss ski resort neighboring the Matterhorn is feeling the heat from a New York-based financier. Edmond Offermann, a nuclear scientist turned millionaire working for hedge fund Renaissance Technologies LLC, invested 15 million Swiss francs ($16.4 million) in 2010 to revive Saas- Fee’s struggling ski-lift company. “It’s like a hobby, which completely got out of control,” Offermann, 53, said in an interview from Long Island, New York. He wants to shake things up by managing hotels and the ski-lift operator in one company controlled by a single chief executive. JPMorgan Joins Rental Rush For Wealthy Clients (Bloomberg) The firm’s unit that caters to individuals and families with more than $5 million, put client money in a partnership that bought more than 5,000 single family homes to rent in Florida, Arizona, Nevada and California, said David Lyon, a managing director and investment specialist at J.P. Morgan Private Bank. Investors can expect returns of as much as 8 percent annually from rental incomeas well as part of the profits when the homes are sold, he said. Man Allegedly Tries To Walk Out Of Costco With 24 Quarts Of Oil — Strapped To His Body (CBS) Jorge Sanchez, 35, was spotted about 4:30 p.m. trying to leave a Burbank Costco without paying for the oil. Store employees gave chase and officials said they lost Sanchez after he jumped a fence at the west side of the Costco parking lot. Burbank Police Sgt. Darin Ryburn told CBS2/KCAL9 reporter Andrea Fujii that nine of the 24 quarts were recovered during the foot chase. Authorities said Sanchez walked into the Costco and went straight to the oil aisle. He allegedly grabbed a couple of cases and emptied them. Said Ryburn, “He proceeded to hide the quarts of oil in his pants, socks, and in his shirt.” Sanchez was later apprehended near Beachwood Drive and Monterey Avenue, about eight blocks from the store. Officials said he was arrested on suspicion of burglary charges. Margo Martin was a witness to the apprehension. “All of a sudden, I hear ‘Get down on the ground’ and there is this man laying in our driveway.” Witnesses thought the man was running funny and weren’t sure why. Witness Manuel Atlas said, “He looked kind of heavy and out of shape.” Police said Sanchez was also running funny because he still had 15 quarts of oil strapped to him. Police said he used a bungee cord to strap the bottles down.

Why I Left Goldman Sachs, Chapter Three: "My Alleged Competition"

In the ping pong game of life, even your most trusted blade can't swat away an opponent with super-sized balls.---Unknown On Monday morning, Grand Central Publishing will release Why I Left Goldman Sachs: A Wall Street Story, a memoir penned by former Goldman employee Greg Smith, based on his op-ed for the New York Times entitled, "Why I Am Leaving Goldman Sachs." When Smith's piece came out last March, few if any senior executives inside the bank were pleased, in part because it came as a total shock. No one at Goldman had known Smith was planning to have his resignation letter printed in the paper. No one had known he had issues with the firm's supposedly new and singular focus on making money at all costs. No one, at least at the top, even knew who Greg was. Obviously all this left the bank at a competitive disadvantage in terms of fighting back and for the time being, Smith appeared to be handing Goldman its ass. Getting cocky, even. Perhaps thinking to himself, "When all of this is over, I could be named the new CEO of Goldman Sachs."  As anyone who has ever won a bronze medal in ping-pong at the Maccabiah Games will tell you, however, winners are determined by best of threes. And that anyone going to to the table with Goldman Sachs should be prepared for things to get ugly. Which is why it should not have come as a surprise that after getting hydrated, regrouping, and coming up with a plan of attack, Goldman kicked off round two with a delightfully bitchy, exceptionally underminery comment to the press re: Smith's tale being no more interesting than that of a disgruntled first-year analyst who thinks he's got a story to tell and then followed it up with a leak of Greg's less than flattering performance reviews to the Financial Times. What probably did come as a surprise, however, was today's breathtakingly aggressive Bloomberg piece re: Mr. Smith wherein: * He's described as a petulant child with unrealistic expectations for his career advancement * It's suggested, by saying outright, that his op-ed complaints about the firm were nothing more than him having "an axe to grind" on account of not advancing beyond vice-president, as demonstrated by the fact that as of 2010, he was happy with the firm, wanted to become a managing director and had no intention of leaving * People are left to connect the dots re: Smith and lady bosses ("Goldman Sachs put a different managing director in charge of Smith as it considered giving him a sales job. The report says he 'found the transition difficult and considered the female MD who ran the desk a peer at not his boss") Relatedly, as we head into the final game of the set with a tie score, the following is a tremendous anecdote from Chapter 3 of Why I Left Goldman Sachs involving an actual game of ping-pong, John Whitehead's Business Principles, and the lessons one learns as a first-year at GS about allowing a client to enjoy the sweet taste of victory despite knowing full-well you could wipe the floor with him or her and bring home the gold, if you so chose. After hearing of my past sports success, Rudy immediately fired off an e-mail to Ted Simpson, saying "Springbok will be representing the New York desk at the Ping-Pong tournament." Simpson wrote back: "Who's Springbok?" In response, Rudy e-mailed him a photograph of a springbok, the actual animal. You had to be there, but I thought it was hilarious. So I flew to Boston on Goldman's tab-- the justification being that while there, I could meet with Prakash and talk Israeli tech stocks-- and met Ted Simpson. […] The backstory of the annual Goldman Sachs Ping-Pong Tournament, Ted told me, was that the same guy, an Indian portfolio manager from Putnam, had won it five years in a row, and that winning the tournament was the highlight of the guy's year. But from the moment I walked into Jillian's- a pleasure palace replete with free-flowing alcohol, spicy chicken wings, bowling alleys, plasma TVs, and dozens of Foosball, pool and table tennis tables-- and saw my alleged competition practicing, I knew he didn't have a chance against me. I'm not trying to brag. But competitive table tennis, like every sport, has its levels. Any number of internationally ranked players could have (and had) made mincemeat out of me, yet simply put, the Putnam portfolio manager (let's call him PPM) and I were not in the same league. I was confident he wouldn't be able to return my serve, and if it came to a rally, he wouldn't be prepared for the kind of sever spins I could put on the ball. I could see he was a very good basement player, nothing more. I could have beaten him in my sleep. The tournament draw was posted. Thirty-two people, and PPM was seeded number one. Since the organizers knew I was good, I was the number two seed. Play began. I was rusty-- I'd been working such long hours since joining Goldman that I'd barely picked up a paddle-- but soon I remembered my form. And nobody gave me a serious challenge. PPM and I plowed through our halves of the draw, heading toward an inevitable confrontation. I watched a couple of his matches. PPM's opponents were easy pickings: recreational players dressed in jeans and polo shirts. And PPM, looking very professional in his special sneakers and running shorts, T-shirt, and headband, was mopping them up. Of course he'd brought his own paddle-- a serious player would never show up without his own stick. And of course I'd brought along my trusty Donic Appelgren blade, red on one side, black on the other. Ted Simpson and I were looking on as PPM took down another player. "So what are we thinking here?" I asked Ted. "I"m going to meet this guy in the final, and if play properly, I'm going to beat him twenty-one to two. What' the right course of action?" Ted looked thoughtful. "Well," he said after a moment, "this guy is one of our biggest clients; he takes this stuff really seriously." At that moment, PPM whaled away at a forehand that just clipped the table edge and skipped off, unreturnable; he raised his arms in victory. "We need to make it a close game," Ted said. "Get some good rallies going." I told Ted I had been thinking along the same lines. That I should beat PPM, because it was obvious I could beat him, but that I should keep it close. Not embarrass him. I knew how to do that, I said. You just make a few unforced errors here and there. "Hmm," Ted said. "You have a different idea?" I asked. "Well, the guy is one of our biggest clients," he repeated, givingme a significant look. "You're suggesting--?" "Maybe," he said. And then: "Watch for my signal." I gave Ted a look-- he was smiling-- and took my Donic out of its case. The match began. A crowd had gathered to watch us play. Everybody was having fun-- except for my opponent, who was taking the match very seriously. When I won a few points in the early going, I could see him getting upset. So I eased up. I could have really turned on the heat, hit some crazy shots past him that would have whizzed by his ear-- but I didn't. My whole plan was to keep the ball in play. To give the crowd a good show, instead of slicing the ball back when PPM smashed it at me, I would lob it up for him so he could smash it again. Smash, lob. Smash, lob. Oohs and has from the onlookers. After three or four exchanges like this, I'd either hit it into the net or give PPM such an easy pop-up that he could make a legitimate put-away on me. I was letting him show off for his fellow clients a little bit. He loved it. The matches were best two out of three, and my plan was to squeak out a win in the second game, then maybe win by just a little more in the third. But when I was ahead 15 to 12 in the second, Ted Simpson caught my eye. He gave a little shake of the head, and then, using his left hand as a shield, gave me a quick thumbs-down with his right. I'm quite sure nobody but Ted and I knew what was going on. I nodded. After all, wasn't putting the client first number one of John Whitehead's 14 Business Principles? The Putnam portfolio manger was very magnanimous in victory-- as i was in defeat. Greg Smith Quit Goldman Sachs After 'Unrealistic' Pitch For $1M [Bloomberg] Earlier: Greg Smith: Goldman Sachs Interns Taught Harsh But Important Lessons By Demanding But Affable Managing Directors; What Else Does Goldman Sachs Have In Store For Greg Smith?; Goldman Sachs Unimpressed By Sophomoric Writing Efforts Of Former Employee; Resignation Letter Reveals Goldman Sachs Is In The Business Of Making Money, Hires People Who Don’t Know How To Tie Their Shoes; Jewish Ping-Pong Tournament Participant / Sixth-Year Goldman Sachs Vice President Is Looking For His Next Challenge; Goldman Sachs Accuser Greg Smith (Might Have) Lied About That Which He Holds Most Sacred