Opening Bell: 11.26.12

UBS Stung By Adoboli Case (WSJ) Swiss financial market regulator Finma said it will keep a close eye on UBS's investment bank for the foreseeable future and may ask it to raise fresh capital, following an investigation into failures that allowed London-based trader Kweku Adoboli to make unauthorized trades. At the same time, the U.K. Financial Services Authority fined UBS £29.7 million ($47.6 million). Mr. Adoboli was convicted of fraud last week and sentenced to a seven-year prison term. "The measures ordered by Finma include capital restrictions and an acquisition ban on the investment bank, and any new business initiative it plans must be approved by Finma," the regulator said. Finma will also consider "whether UBS must increase capital backing for its operational risks," will appoint a third party to ensure corrective measures are introduced, and will organize an audit to review the steps taken by UBS. Finma declined to say when the auditing review would be completed or when a decision on a capital increase would be made, though a spokesman said this is likely to be within months rather than years. SAC Fund Manager Faces Choice of Trial or Deal (Bloomberg) Martoma, 38, used illegal tips to help SAC make $276 million on shares of pharmaceutical companies Elan Corp. and Wyeth LLC, according to the Justice Department and the Securities and Exchange Commission. Arrested last week, he is to appear today in Manhattan federal court for masterminding what the U.S. calls the most lucrative insider-trading case ever. Flowers Foods Sizes Up Hostess (WSJ) The Thomasville, Ga., company is considered a likely bidder for some of the assets owned by Hostess, which last week was granted permission by a federal bankruptcy-court judge to begin liquidating. The end came after a contentious bankruptcy that began in January and culminated this month in a strike. Goldman Turns Down Southern Europe Banks as Crisis Lingers (Bloomberg) Goldman Sachs, the No. 1 stock underwriter in Europe, turned down roles in offerings by banks in Spain and Italy this year, the only top U.S. securities firm not to take part in the fundraisings by southern European lenders as the region’s debt crisis stretches to a fourth year. The firm declined a role in Banco Popular Espanol SA’s 2.5 billion-euro ($3.2 billion) rights offering this month because it wanted greater protection to avoid potential losses on the sale, two people familiar with the talks said. JPMorgan and Morgan Stanley are helping to guarantee the deal. Goldman also didn’t underwrite this year’s share sales by Italy’s UniCredit SpA and Portugal’s Banco Espirito Santo SA, which drew Bank of America Corp. and Citigroup. Knight Seen Getting Acquisition Bids This Week (Bloomberg) The company with a market value of about $430 million was bailed out by six financial firms in August after losing $457 million in a trading error. Chicago-based Getco LLC, one of the rescuers, and Virtu Financial LLC in New York are among the likely bidders, said the person, who requested anonymity because the negotiations are private. The Wall Street Journal reported Nov. 23 that Knight expected offers for its market-making unit. Woman who rode manatee charged with violating protection act (Sentinel) A 53-year-old Pinellas County woman was arrested Saturday for violating the Florida Manatee Sanctuary Act by riding a sea cow in the waters near St. Petersburg in September. Ana Gloria Garcia Gutierrez of St. Petersburg was arrested at her place of employment — Sears at Tyrone Square Mall in St. Petersburg — on a warrant issued by the State Attorney's Office. The charge is a second-degree misdemeanor. The punishment could be a $500 fine or up to 60 days in jail, the Tampa Bay Times said. Gutierrez stepped forward after the Pinellas County Sheriff's Office released photos of a then-unknown woman riding a manatee near Fort DeSoto Park in Pinellas County on Sept. 30. "Gutierrez admitted to the offense claiming she is new to the area and did not realize it was against the law to touch or harass manatees,'' the Pinellas County Sheriff's Office said in a statement. Escrowyou too, judge! (NYP) Argentina, bruised and battered after a 10-year battle to sidestep billions of dollars in bond payments, is lashing out at US courts and a Manhattan federal court judge. A high-ranking member of Argentina President Cristina Kirchner’s administration terms “judicial imperialism” the Thanksgiving eve ruling by Judge Thomas Griesa that ordered the South American country to place a $1.3 billion bond payment in escrow pending the end of the legal tussle. Kirchner has repeatedly said she would not pay up. Griesa, frustrated with Argentina’s repeated attempts to stall the legal proceedings, sided with New York hedge fund billionaire Paul Singer, whose Elliott Management owns Argentine bonds that were defaulted on back in 2002. 'Cliff' Threatens Holiday Spending (WSJ) The White House warned in a new report that going off the so-called "fiscal cliff" could slow the growth of real gross domestic product by 1.4% and limit consumer spending during the holiday season. The report comes as lawmakers are returning to Washington with just weeks left to find an agreement to prevent taxes from going up on millions and spending cuts from kicking in. It will likely provide fodder for both political parties as they seek to find a compromise. At Some Firms, Cutting Corporate Rates May Cost Billions (WSJ) President Barack Obama has said, most recently during last month's presidential debates, that the 35% U.S. corporate tax rate should be cut. That would mean lower tax bills for many companies. But it also could prompt large write-downs by Citigroup, AIG, Ford and other companies that hold piles of "deferred tax assets," or DTAs...Citigroup, for instance, acknowledged during its recent third-quarter earnings conference call that a cut in the tax rate could lead to a DTA-related charge of $4 billion to $5 billion against earnings. Cohen's General Counsel Gives SAC Boss Cover (NYP) The sharks of the US Attorney’s office have SAC Capital Advisors surrounded — and owner Steven Cohen is looking a lot like chum. Good thing the billionaire hedgie has a large supply of shark repellent. That would be Peter Nussbaum, SAC’s longtime general counsel who, over his 12 years at the Stamford, Conn., firm, has built up an impressive 30-person compliance department — not including an additional tech compliance team. “Nussbaum is the most respected person at SAC,” said a hedge fund executive not at SAC. “He is going to do what he thinks is best for the firm and not be cowed by anyone.” Nussbaum’s huge compliance department, observers said, was built, in large part, because of the perception that the government was determined to bust Cohen. Confidential Police Docs Found in Macy's Parade Confetti (WPIX) Confidential personal information is what some paradegoers found among confetti tossed during the world's most famous parade. That information included social security numbers and banking information for police employees, some of whom are undercover officers. Ethan Finkelstein, who was home from college on Thanksgiving break, was watching the parade at 65th Street and Central Park West, when he and a friend noticed a strip of confetti stuck onto her coat. "It landed on her shoulder," Finkelstein told PIX11 News, "and it says 'SSN' and it's written like a social security number, and we're like, 'That's really bizarre.' It made the Tufts University freshman concerned, so he and his friends picked up more of the confetti that had fallen around them. "There are phone numbers, addresses, more social security numbers, license plate numbers and then we find all these incident reports from police." One confetti strip indicates that it's from an arrest record, and other strips offer more detail. "This is really shocking," Finkelstein said. "It says, 'At 4:30 A.M. a pipe bomb was thrown at a house in the Kings Grant' area." A closer look shows that the documents are from the Nassau County Police Department. The papers were shredded, but clearly not well enough.
Author:
Publish date:

UBS Stung By Adoboli Case (WSJ)
Swiss financial market regulator Finma said it will keep a close eye on UBS's investment bank for the foreseeable future and may ask it to raise fresh capital, following an investigation into failures that allowed London-based trader Kweku Adoboli to make unauthorized trades. At the same time, the U.K. Financial Services Authority fined UBS £29.7 million ($47.6 million). Mr. Adoboli was convicted of fraud last week and sentenced to a seven-year prison term. "The measures ordered by Finma include capital restrictions and an acquisition ban on the investment bank, and any new business initiative it plans must be approved by Finma," the regulator said. Finma will also consider "whether UBS must increase capital backing for its operational risks," will appoint a third party to ensure corrective measures are introduced, and will organize an audit to review the steps taken by UBS. Finma declined to say when the auditing review would be completed or when a decision on a capital increase would be made, though a spokesman said this is likely to be within months rather than years.

SAC Fund Manager Faces Choice of Trial or Deal (Bloomberg)
Martoma, 38, used illegal tips to help SAC make $276 million on shares of pharmaceutical companies Elan Corp. and Wyeth LLC, according to the Justice Department and the Securities and Exchange Commission. Arrested last week, he is to appear today in Manhattan federal court for masterminding what the U.S. calls the most lucrative insider-trading case ever.

Flowers Foods Sizes Up Hostess (WSJ)
The Thomasville, Ga., company is considered a likely bidder for some of the assets owned by Hostess, which last week was granted permission by a federal bankruptcy-court judge to begin liquidating. The end came after a contentious bankruptcy that began in January and culminated this month in a strike.

Goldman Turns Down Southern Europe Banks as Crisis Lingers (Bloomberg)
Goldman Sachs, the No. 1 stock underwriter in Europe, turned down roles in offerings by banks in Spain and Italy this year, the only top U.S. securities firm not to take part in the fundraisings by southern European lenders as the region’s debt crisis stretches to a fourth year. The firm declined a role in Banco Popular Espanol SA’s 2.5 billion-euro ($3.2 billion) rights offering this month because it wanted greater protection to avoid potential losses on the sale, two people familiar with the talks said. JPMorgan and Morgan Stanley are helping to guarantee the deal. Goldman also didn’t underwrite this year’s share sales by Italy’s UniCredit SpA and Portugal’s Banco Espirito Santo SA, which drew Bank of America Corp. and Citigroup.

Knight Seen Getting Acquisition Bids This Week (Bloomberg)
The company with a market value of about $430 million was bailed out by six financial firms in August after losing $457 million in a trading error. Chicago-based Getco LLC, one of the rescuers, and Virtu Financial LLC in New York are among the likely bidders, said the person, who requested anonymity because the negotiations are private. The Wall Street Journal reported Nov. 23 that Knight expected offers for its market-making unit.

Woman who rode manatee charged with violating protection act (Sentinel)
A 53-year-old Pinellas County woman was arrested Saturday for violating the Florida Manatee Sanctuary Act by riding a sea cow in the waters near St. Petersburg in September. Ana Gloria Garcia Gutierrez of St. Petersburg was arrested at her place of employment — Sears at Tyrone Square Mall in St. Petersburg — on a warrant issued by the State Attorney's Office. The charge is a second-degree misdemeanor. The punishment could be a $500 fine or up to 60 days in jail, the Tampa Bay Times said. Gutierrez stepped forward after the Pinellas County Sheriff's Office released photos of a then-unknown woman riding a manatee near Fort DeSoto Park in Pinellas County on Sept. 30. "Gutierrez admitted to the offense claiming she is new to the area and did not realize it was against the law to touch or harass manatees,'' the Pinellas County Sheriff's Office said in a statement.

Escrowyou too, judge! (NYP)
Argentina, bruised and battered after a 10-year battle to sidestep billions of dollars in bond payments, is lashing out at US courts and a Manhattan federal court judge. A high-ranking member of Argentina President Cristina Kirchner’s administration terms “judicial imperialism” the Thanksgiving eve ruling by Judge Thomas Griesa that ordered the South American country to place a $1.3 billion bond payment in escrow pending the end of the legal tussle. Kirchner has repeatedly said she would not pay up. Griesa, frustrated with Argentina’s repeated attempts to stall the legal proceedings, sided with New York hedge fund billionaire Paul Singer, whose Elliott Management owns Argentine bonds that were defaulted on back in 2002.

'Cliff' Threatens Holiday Spending (WSJ)
The White House warned in a new report that going off the so-called "fiscal cliff" could slow the growth of real gross domestic product by 1.4% and limit consumer spending during the holiday season. The report comes as lawmakers are returning to Washington with just weeks left to find an agreement to prevent taxes from going up on millions and spending cuts from kicking in. It will likely provide fodder for both political parties as they seek to find a compromise.

At Some Firms, Cutting Corporate Rates May Cost Billions (WSJ)
President Barack Obama has said, most recently during last month's presidential debates, that the 35% U.S. corporate tax rate should be cut. That would mean lower tax bills for many companies. But it also could prompt large write-downs by Citigroup, AIG, Ford and other companies that hold piles of "deferred tax assets," or DTAs...Citigroup, for instance, acknowledged during its recent third-quarter earnings conference call that a cut in the tax rate could lead to a DTA-related charge of $4 billion to $5 billion against earnings.

Cohen's General Counsel Gives SAC Boss Cover (NYP)
The sharks of the US Attorney’s office have SAC Capital Advisors surrounded — and owner Steven Cohen is looking a lot like chum. Good thing the billionaire hedgie has a large supply of shark repellent. That would be Peter Nussbaum, SAC’s longtime general counsel who, over his 12 years at the Stamford, Conn., firm, has built up an impressive 30-person compliance department — not including an additional tech compliance team. “Nussbaum is the most respected person at SAC,” said a hedge fund executive not at SAC. “He is going to do what he thinks is best for the firm and not be cowed by anyone.” Nussbaum’s huge compliance department, observers said, was built, in large part, because of the perception that the government was determined to bust Cohen.

Confidential Police Docs Found in Macy's Parade Confetti (WPIX)
Confidential personal information is what some paradegoers found among confetti tossed during the world's most famous parade. That information included social security numbers and banking information for police employees, some of whom are undercover officers. Ethan Finkelstein, who was home from college on Thanksgiving break, was watching the parade at 65th Street and Central Park West, when he and a friend noticed a strip of confetti stuck onto her coat. "It landed on her shoulder," Finkelstein told PIX11 News, "and it says 'SSN' and it's written like a social security number, and we're like, 'That's really bizarre.' It made the Tufts University freshman concerned, so he and his friends picked up more of the confetti that had fallen around them. "There are phone numbers, addresses, more social security numbers, license plate numbers and then we find all these incident reports from police." One confetti strip indicates that it's from an arrest record, and other strips offer more detail. "This is really shocking," Finkelstein said. "It says, 'At 4:30 A.M. a pipe bomb was thrown at a house in the Kings Grant' area." A closer look shows that the documents are from the Nassau County Police Department. The papers were shredded, but clearly not well enough.

Related

Opening Bell: 11.28.12

Gorman Enlists Morgan Stanley Workforce in Fiscal Cliff Campaign (Bloomberg) Morgan Stanley Chief Executive Officer James Gorman called on the investment bank’s employees to pressure U.S. lawmakers into reaching an agreement that averts the so-called fiscal cliff. “No issue is more critical right now for the U.S. economy, the global financial markets and the financial well-being of our clients, which is why I am asking you to participate in the democratic process and make your voice heard,” Gorman wrote in a memo, a copy of which was obtained by Bloomberg News. The message went to about 30,000 U.S. workers including 16,000 financial advisers, said James Wiggins, a company spokesman. Buffett Expects 'Fiscal Cliff' Fix, But Not By December 31 (CNBC) Buffett didn't outline a specific solution that he prefers, saying he could "go with any number of plans." But he thinks the end result should have U.S. revenues at 18.5 percent of GDP and expenditures at 21 percent. Those levels would be "sustainable" because the ratio of the nation's national debt to GDP wouldn't increase, and might even fall over time. SAC Capital Received a Wells Notice From SEC Last Week, May Be Subject to Civil Charges (CNBC) Story developing. EU Approves Spanish Banks' Restructuring Plans (WSJ) European Union regulators Wednesday gave the green light to nearly €40 billion ($51.78 billion) in euro-zone funding for Spain's stricken bank sector, as it approved the restructuring plans for four lenders. BFA/Bankia, NCG Banco, Catalunya Banc and Banco de Valencia SA BVA.MC will require a total of €37 billion for their recapitalization plans, the regulators said. The European Union's Competition Commissioner, Joaquin Almunia, said bondholders would face losses. Will Italy Need A Bailout In 2013? (CNBC) “We still see as our baseline scenario that Italy will likely be forced to ask for an international bailout at some point in 2013,” said Citi Analyst Giada Giani in a report on the country. “Italian economic fundamentals have not really improved, despite some improvement in market conditions. The negative feedbacks from fiscal austerity on growth have been severe, as the ability of the private sector to absorb fiscal tightening by lowering its saving rate is limited.” EU Agrees New Controls for Credit Rating Agencies (Reuters) European Union countries and the bloc's parliament agreed on Tuesday to introduce limited controls on credit ratings agencies after their judgment was called into question in the debt crisis. Michel Barnier, the European commissioner in charge of regulation who helped broker a deal on the new law, said it aimed to reduce the over-reliance on ratings and establish a civil liability regime. The new rules should make it easier to sue the agencies if they are judged to have made errors when, for example, ranking the creditworthiness of debt. Deutsche Bank Sued Over Home Mortgage-Backed Securities (Bloomberg) Deutsche Bank, Germany’s largest lender, was sued by a trustee over claims that some securities sold by a unit of the bank were backed by home-mortgage loans taken out by fraudulent borrowers. DB Structured Products Inc.’s pool of more than 1,500 mortgages included more than 320 that were defective, HSBC Bank USA (HSBA), acting as trustee, said in a lawsuit filed yesterday in federal court in Manhattan. “Borrowers lied, with or without the knowledge of the loan originators themselves, concerning how much money they owed, how much money they made, whether and where they worked, and where they lived,” HSBC claimed. “A handful of instances of such inaccuracies is perhaps to be expected. Hundreds of instances of borrower dishonesty is not.” HSBC seeks unspecified damages and said Frankfurt-based Deutsche Bank must buy back the breaching loans under its agreements with the trustee. Woman Jailed For Attacking Beau Over Bad Sex (TSG) A Florida woman was jailed last night for a post-coital assault on her boyfriend, an attack the victim says was prompted when only he climaxed during a sexual encounter in the couple’s residence. Raquel Gonzalez, 24, was arrested Monday afternoon for felony domestic battery and booked into the Manatee County lockup, where bond has been set at $750. According to a Manatee County Sheriff’s Office report, Gonzalez and Esric Davis, 30, are “boyfriend and girlfriend who live in the same home and are involved in a sexual relationship.” Deputies noted that Davis and Gonzalez were “involved in sexual intercourse” when “Esric then climaxed and Raquel did not.” Which reportedly angered Gonzalez, who allegedly “began hitting and scratching [Davis], causing scratches near his eye and nose.” Davis told investigators that Gonzalez “goes off” frequently and that she had previously been physical with him. Be right back, hon ... with a $53M tip (NYP) Anthony Chiasson, the founder of hedge fund Level Global, started getting illegal insider tips in 2008 when the $4 billion firm was going through a rough patch, a key government witness told a jury yesterday. The witness, Sam Adondakis, a former analyst who worked for Chiasson, said he told his boss tips on Dell came straight from the tech giant...The Dell tip that netted the firm millions wasn’t without its drama. On Aug. 27, the day before Dell announced its results, Chiasson, Level Global co-founder David Ganek, and Greg Brenner, fund executive, held a conference call about their Dell position. At the time, Adondakis, on vacation in the Hamptons, was sitting down to breakfast with his girlfriend, he said yesterday. Adondakis said he remembers the conference call well because his girlfriend “was annoyed” by the conversation, which took him away from their meal for a good 40 minutes. Banks Feel Currency Pinch (WSJ) Banks reported sharp drops in currency-trading revenue last quarter, in many cases deepening a slump that began early this year. Even Deutsche Bank AG, the world's biggest foreign-exchange bank, reported revenue "significantly lower than the prior year" even as the volume of transactions it handled hit a record high in the third quarter. Banks are struggling on two fronts. A calm in currency markets relative to the swings of the last few years has reduced overall trading activity. And the explosive growth of electronic trading has brought transparency to a roughly $4 trillion-a-day market, making buyers and sellers less reliant on big banks to pair them up. Executives' Good Luck in Trading Own Stock (WSJ) Among 20,237 executives who traded their own company's stock during the week before their companies made news, 1,418 executives recorded average stock gains of 10% (or avoided 10% losses) within a week after their trades. This was close to double the 786 who saw the stock they traded move against them that much. Most executives have a mix of trades, some that look good in retrospect and others that do not. 'Two and a Half Men' star apologizes for offending cast and crew (CNN) A day after a video posted online showed him describing "Two and a Half Men" as "filth" and advising viewers to stop watching the sitcom, actor Angus T. Jones apologized to the show's cast and crew Tuesday. "I apologize if my remarks reflect me showing indifference to and disrespect of my colleagues and a lack of appreciation of the extraordinary opportunity of which I have been blessed," Jones said in a statement released by his publicist. "I never intended that." The 19-year-old actor -- who plays Jake Harper, the CBS sitcom's "Half" man -- didn't detail what motivated him to make comments...In the video, the actor, who's been on the show since 2003, repeatedly asks viewers not to watch the sitcom. "I'm on 'Two and a Half Men,' and I don't want to be on it," Jones said. "You cannot be a true God-fearing person and be on a television show like that. I know I can't. I'm not OK with what I'm learning, what the Bible says, and being on that television show. You go all or nothing."

Opening Bell: 12.03.12

Fiscal Cliff Talks At Stalemate (WSJ) Leading figures on both sides doubled down on their positions in interviews that aired Sunday, and they blamed each other for the current standoff, reflecting the talks that House Speaker John Boehner (R., Ohio) told "Fox News Sunday" have gone "nowhere." Treasury Secretary Timothy Geithner, speaking on the same program for the Obama administration, suggested Republicans needed to take a breather from negotiations but would ultimately agree to raise tax rates—a key White House demand that is part of its push to raise $1.6 trillion in taxes over 10 years. "It's obviously a little hard for them now, and they're trying to figure out where they go next, and we might need to give them a little time to figure out where they go next," Mr. Geithner said. Geithner Joins Boehner to Trade Blame on Fiscal Cliff Talks (Bloomberg) “There’s not going to be an agreement without rates going up,” Geithner said in a taped interview that aired Sunday on CNN’s “State of the Union.” Republicans will “own the responsibility for the damage” if they “force higher rates on virtually all Americans because they’re unwilling to let tax rates go up on 2 percent of Americans.” Clock Ticks For SAC Investors (WSJ) Seventy-five days remain until Feb. 15, the date by which investors must tell SAC whether they want to pull money from the firm during the next redemption period...Some investors already decided to pull out. French bank Société Générale SA, which has client money in SAC through its Lyxor asset-management arm, has put in a request to pull its money from the firm, according to people familiar with the matter. It is unclear how much money Lyxor has in SAC. Many, however, said they would reserve judgment, at least for now. Ironwood Capital Management, a San Francisco-based investment firm with client money in SAC, has been in touch with investors about the position and is monitoring the situation, said a person familiar with the firm. Last week, a unit within Morgan Stanley's MS +0.06% asset-management arm that has client money with SAC sent a note telling employees it would monitor the situation and be in touch frequently with SAC, according to a person familiar with the bank...Greycourt & Co., Inc., a Pittsburgh-based firm that manages about $9 billion for wealthy families, says it is sticking with SAC. Greycourt cited the stellar long-term returns of the firm, what it says is a robust compliance staff at SAC, Mr. Cohen's promise to cover any penalties himself and a belief that the firm's investment portfolio would be well-protected, even if it eventually faces charges. "The SAC portfolio is liquid enough that I'm not terribly concerned," says Gregory Curtis, Greycourt's chairman. "I very much hope that [Mr.] Cohen hasn't been behaving badly, but either way I'm not too concerned about our client positions." UK’s Euro Trade Supremacy Under Attack (FT) The City of London should be deposed as the euro's main financial center so the single currency club can "control" most financial business in the euro zone, France's central bank governor has said. Christian Noyer of the Banque de France said there was "no rationale" for allowing the euro area's financial hub to be "offshore", in a blunt assessment that will fan UK concerns over EU rules being rigged against it. "Most of the euro business should be done inside the euro area. It's linked to the capacity of the central bank to provide liquidity and ensure oversight of its own currency," Mr Noyer told the Financial Times while touring Asia to promote Paris as a renminbi trading center. "We're not against some business being done in London, but the bulk of the business should be under our control. That's the consequence of the choice by the UK to remain outside the euro area." Zoe Cruz trying to make a return to high finance, has reconciled with John Mack (NYP, earlier) Sources say Cruz has reconciled with her former boss Mack, who helped fuel her rise within their firm before their falling out. He has been helping his one-time protégée in her efforts to land at a buyout firm such as KKR. Mack also has been a shoulder for Cruz to lean on as she copes with the split from her husband Ernesto Cruz...[who] was once reprimanded by his superiors in the mid-2000s for frolicking in a hotel pool in Midtown after a company Christmas gala with a group of female assistants, according to sources familiar with the situation. SEC Chief Delayed Rule Over Legacy Concerns (WSJ) Internal SEC emails, released to a congressional panel and reviewed by The Wall Street Journal, appear to show how a last-minute intervention by a consumer lobbyist might have helped persuade Ms. Schapiro to change her mind and delay one of the centerpiece measures of the Jumpstart Our Business Startups, or JOBS, Act. In Panicky Russia, It’s Official: End of World Is Not Near (NYT) There are scattered reports of unusual behavior from across Russia's nine time zones. Inmates in a women's prison near the Chinese border are said to have experienced a "collective mass psychosis" so intense that their wardens summoned a priest to calm them. In a factory town east of Moscow, panicked citizens stripped shelves of matches, kerosene, sugar and candles. A huge Mayan-style archway is being built — out of ice — on Karl Marx Street in Chelyabinsk in the south. For those not schooled in New Age prophecy, there are rumors the world will end on Dec. 21, 2012, when a 5,125-year cycle known as the Long Count in the Mayan calendar supposedly comes to a close. Russia, a nation with a penchant for mystical thinking, has taken notice. Last week, Russia's government decided to put an end to the doomsday talk. Its minister of emergency situations said Friday that he had access to "methods of monitoring what is occurring on the planet Earth," and that he could say with confidence that the world was not going to end in December. He acknowledged, however, that Russians were still vulnerable to "blizzards, ice storms, tornadoes, floods, trouble with transportation and food supply, breakdowns in heat, electricity and water supply." Similar assurances have been issued in recent days by Russia's chief sanitary doctor, a top official of the Russian Orthodox Church, lawmakers from the State Duma and a former disc jockey from Siberia who recently placed first in the television show "Battle of the Psychics." One official proposed prosecuting Russians who spread the rumor — starting on Dec. 22. Old testimony may bite Cohen in SEC case (NYP) Steve Cohen’s sworn testimony in another legal skirmish could come back to haunt his $14 billion hedge-fund empire...In 2011, Cohen gave several days of deposition testimony in the civil fraud case, in which Fairfax sued SAC and other firms for allegedly conspiring to drive down its share price. The case was dismissed due to a lack of evidence, but the testimony offers a rare look into Cohen’s views on illegal trading. In his testimony, Cohen called SEC rules on insider trading “vague” and said he doesn’t expect his employees to follow the company’s internal compliance manual to the letter. When asked whether it was “legal or illegal to trade on material nonpublic information,” Cohen said: “It depends on the circumstance.” “So there are circumstances, in your view, in which it is legal . . . to trade on the basis of material, nonpublic information?” asked Fairfax ’s lawyer, Michael Bowe. “Yes,” Cohen said. Among them, he said, is when employees trade in the opposite direction of the nonpublic information they receive. He also said he didn’t expect employees to adhere to the company’s compliance manual in every situation. “See, we don’t operate our firm in absolutes,” he said. “When I look at this manual, I see guidelines.” Morgan Stanley trader probed over trades made while at Goldman (Reuters) Morgan Stanley trader Edward Glenn Hadden is under investigation by regulators at CME Group over trades in Treasury futures four years ago while he was employed by Goldman Sachs, according to a regulatory filing. Hadden is a managing director and head of global interest rates products at Morgan Stanley. Prior to joining Morgan Stanley, Hadden was a partner at Goldman Sachs, and head of government bond trading. Hedge Funds Increase Bullish Bets Most Since August (Bloomberg) Hedge funds increased bullish bets on commodities by the most since August as evidence that China is accelerating outweighed concern that U.S. lawmakers have yet to resolve an impasse over automatic spending cuts and tax rises. Krawcheck, possible SEC head, raises Washington (Reuters) ...many who have worked with her say Krawcheck was a smart, analytical and competent executive who not only knew the business, but was good at building consensus among different units of companies. She helped restore brokerage Smith Barney's reputation at Citigroup and was popular with many of the financial advisers at Merrill Lynch. Schumer and other lawmakers contacted by Reuters did not return calls or requests for comment about meetings with Krawcheck or their thoughts about her. In the end, of course, Krawcheck may not land in Washington at all, two people who know her said. She has had discussions about a variety of roles with several companies, one source said. "She has lots of balls in the air," said the source, who asked not to be named because the conversations were private. "Sallie always has a plan." Bret Easton Ellis mistakenly asks for cocaine on Twitter (DJ) Bret Easton Ellis, famed author of "American Psycho," tweeted a request for cocaine Sunday morning, leaving many to speculate that it was supposed to be a private message...“Come over at do bring coke now,” he tweeted at 3:44AM, stranding his 360,000 followers in a state of bewilderment regarding what the cryptic tweet could possibly mean.

Holiday Bell: 11.23.12

FBI Tried To Flip Trader Against Cohen (WSJ) A year before the government charged Mathew Martoma with insider trading, it tried to get him to turn against his former boss, Steven A. Cohen. Federal agents, including Federal Bureau of Investigation case agent Matthew T. Callahan, turned up at the Boca Raton, Fla., home of Mr. Martoma, a former portfolio manager at an affiliate of SAC Capital Advisors L.P. Agents tried and failed to persuade him to be a cooperating witness in the government's effort to build a criminal case against Mr. Cohen, the founder of SAC and one of the biggest names in the hedge-fund world, said people close to the case...The government's attempt to engage Mr. Martoma as a cooperating witness shows the high level of focus placed on Mr. Cohen, whose $14 billion fund has posted some of the best returns on Wall Street. It also demonstrates how the government has been unable so far to implicate Mr. Cohen in Mr. Martoma's alleged wrongdoing...Each of the two securities fraud charges against Mr. Martoma carry a maximum of 20 years in prison; federal sentencing guidelines, based on the amount of the alleged illegal profits, recommend a sentence of 15 to 19 years. By contrast, most people who have pleaded guilty to insider trading and cooperated with the government have been sentenced to little or no jail time. Mr. Martoma is married with children. "Twenty years is a very long time in prison," said Thomas Gorman, a partner at Dorsey & Whitney LLP in Washington, referring to the sentence Mr. Martoma could serve if convicted. "There will be an enormous amount of pressure to earn a cooperation credit to try to mitigate that." Cohen’s ’Elan Guy’ Martoma Dropped Ethics for Hedge Fund (Bloomberg) Martoma got his undergraduate degree at Duke University in Durham, North Carolina, according to the university registrar. During his first year, he was inducted into Phi Eta Sigma, an honors society for freshmen who attain at least a 3.5 grade point average, according to the university registrar. He graduated in December 1995. Less than two years later, he went off to Harvard Law School in Cambridge, Massachusetts. He wrote two medical-ethics papers, one of which identifies him as a member of Harvard Law’s class of 2000 and as the former deputy director of the National Human Genome Research Institute’s Office of Genome Ethics. He left Harvard in December 1998 without attaining a degree, according to the school’s registrar, and attended Stanford Business School, where he joined three alumni groups including MBA Class of 2003, according to university records. In 2001, he changed his name from Ajai Mathew Mariamdani Thomas...Former colleagues, who asked not to be named because the fund is private, said the Martoma, who stood almost six feet tall, had a quiet demeanor and left little impression except for an outsized trade that earned him the name “the Elan guy.” Trading Case Casts a Deeper Shadow on a Hedge Fund Mogul (NYT) Thus far, any potential evidence against Mr. Cohen is entirely circumstantial. The government's complaint includes e-mails about secretly selling the Elan and Wyeth shares through esoteric methods like algorithms and dark pools. But that is common practice among large, sophisticated funds that do not want to alert competitors or move the stock too much. Moreover, while SAC dumped its large positions in the two stocks quickly - raising the question of what prompted it to do so - Mr. Cohen is known for a rapid-fire trading style. He frequently moves aggressively in and out of stocks while processing gobs of information fed to him by his underlings. It would be difficult for a jury to infer anything incriminating just from the way these trades were executed. The government in this case also lacks the powerful wiretap evidence that it has used to convict dozens others, including Raj Rajaratnam, the head of the Galleon Group. Greek Bond Buyback In Doubt (WSJ) The rally in outstanding Greek bonds has made any buyback plan more expensive, eroding the impact it would have on Greece's debt. It raises the challenge for euro-zone finance ministers to seal a deal at their next meeting on Monday that would both plug holes in Greece's €246 billion ($316.95 billion) bailouts and bring the country's debt load to a more manageable level. S&P Confirms France's AA-Plus Rating (WSJ) The decision removes the immediate threat of another downgrade of France, though S&P kept a negative outlook on the country's debt. That indicates a one-in-three chance of a cut in France's credit rating during 2013. Diamond, Dimon’s Early Risks Made Them Better: Adoboli (Bloomberg) Adoboli, who was jailed Nov. 20 for causing the largest unauthorized trading loss in British history, said in an e-mail exchange with Bloomberg News that Jamie Dimon, Bob Diamond and Yassine Bouhara, the former co-head of global equities at UBS, all lost large amounts of money at some point in their careers. The more senior you are the easier it is to avoid getting slammed to the wall,” Adoboli wrote in a Nov. 14 e-mail. “Funny thing is though, losing money seems to make you better at making money. Perhaps that’s why traders who lose money always get rehired, as long as they still have their risk appetite.” Canada Police Arrest Man Who Told Kids Santa Isn't Real (Star) As Christmas-themed floats slowly rolled down Princess St. during Kingston’s annual Santa Claus parade, an intoxicated man shouted blasphemous lies to shocked children: Santa doesn’t exist. The man, whose gelled hair “looked like a set of devil horns protruding from his head,” was reported to Kingston police, Const. Steve Koopman said. Police arrested a 24-year-old man around 6 p.m. “It was pretty despicable that someone, during this time of the year, would tell kids Santa isn’t real — which of course we would argue,” Koopman said. Higher Gas-Tax Idea Joins Fiscal-Cliff Talks (WSJ) Other industries also are moving to have initiatives attached to a budget deal—as part of either a short-term agreement this year or a longer-term plan reached next year to overhaul spending and taxes. Casinos are pushing a measure to legalize Internet poker games nationally. Small banks are pressing to extend a program that gives unlimited federal guarantees to certain bank deposits. Governors want additional aid to cover destruction wrought by Hurricane Sandy. The financial industry is pushing to loosen regulations on complex financial derivatives. "Basically, you've got a bunch of people waiting in the wings to stick the collection plate out and grab whatever they can grab," said Dan Kish, senior vice president for policy at the Institute for Energy Research, which advocates for free-market energy policies. Jain Gets Silent Treatment as Bankers Eat Humble Pie (Bloomberg) Deutsche Bank co-Chief Executive Anshu Jain says telling people he works in banking is a conversation-killer at parties, as the industry fails to convince the general public that it’s changing. “If you go to a party these days, you’re asked what you do and you say you’re a banker, people go all quiet,” Jain said before a conference on Europe’s finance industry began in Frankfurt. “We’re still the subject of anger.” Judge Rules For Singer (Reuters) A federal judge has ordered Argentina to pay holders of defaulted bonds, including Paul Singer’s Elliott Management, immediately, a blow to the country’s efforts to overcome a 2002 debt crisis that has raised fears of another default. In a ruling Wednesday, Judge Thomas Griesa lifted a previous order stalling payments to so-called holdout investors who refused to take part in two swaps of defaulted debt. Argentina’s president, Cristina Fernandez, has said her government will not pay “one dollar,” and Griesa’s ruling cited threats by Argentina’s leaders to defy his rulings in the decade-old dispute. Germany Halts Swiss Tax Deal (WSJ) The bilateral treaty was vetoed by the left-leaning Social Democrat and Green opposition parties in the Bundesrat, which represents Germany's 16 states. The treaty's opponents argue that it is too lenient on tax evaders. We want a treaty that is "more painful to Swiss banks and German tax evaders," Norbert Walter-Borjans, the Social Democrat finance minister of the German state North Rhine-Westphalia said in a debate in the upper house preceding the vote Friday. A ‘Whale’ of a Chase is on (NYP) JPMorgan Chase turned its chief investment office into a proprietary-trading unit that caused more than $6.2 billion in losses, pension funds said in a revised complaint in their suit against the bank. JPMorgan contended the unit’s primary role was managing risk when in fact it was engaging in trades to generate profit for the bank, the funds said in an amended complaint filed in Manhattan federal court. CEO Jamie Dimon “secretly transformed the CIO from a risk management unit into a proprietary-trading desk,” the plaintiffs said. The pension funds allege they incurred losses in their holdings because of trades by the chief investment office and Bruno Iksil, known as “the London Whale.” Porn star vows night of passion if Barcelona wins (NYDN) Colombian-born Janeira Ventura said she would give "any Barca fan who dares" the "night of their lives" if Lionel Messi, Andres Iniesta and co. fire them to the top of La Liga by the end of the season. The adult actress told Mundo Deportivo, "If we win the league this year, I pledge publicly to spend a night of passion with any Barcelona member or supporter who dares. "How can they prove they support the team? It's easy, by showing me the membership card or photos and tickets to a game. They just have to contact me on my website." The 27-year-old was born in Barranquilla, moved to Spain when she was a baby and now lives in Toronto. She added, "I've been a Barcelona fan since I was little, I love the team, the way they play, and above all I love the players. The most sexy ones? Messi, Xavi and Puyol." Her obsession extends to having two cats, who are called Leo and Messi, and plans to tattoo the Argentine striker's name "in a secret place" when she returns to Spain in 2013. She also wants to convince Barcelona bosses to let her be their "official club porn star."

Opening Bell: 03.26.13

Bailout Strains European Ties (WSJ) Several officials familiar with talks in Nicosia and Brussels over the €10 billion ($13 billion) rescue for the island described more than a week of chaotic negotiations. European officials cited Cypriot foot-dragging, reversals and dropped communications, a situation one European Union official called "terrifying." Cypriot officials described their European opposites as demanding and inflexible. Big Cypriot Bank Depositors Could Lose 40%: Minister (Reuters) "It could be in that neighborhood but I do not want to anticipate it," Sarris told BBC radio, adding the exact figure was yet to be decided. "But what I have seen suggests a number in that neighborhood." Sheik Spars With UBS Over $20 Million Fee (WSJ) A Kuwaiti sheik alleges that a senior executive at Switzerland's UBS offered $20 million to get the bank an advisory role on one of the biggest-ever acquisitions in the Middle East, but the bank later backed out of the deal, according to the sheik's testimony in a Dubai court case. Sheik Meshal Jarah Al Sabah said in sworn testimony that UBS offered the commission in 2009 to derail a bid by the French media group Vivendi SA for the African telecommunications assets of Zain, Kuwait's biggest mobile-phone company, and to get UBS a lead role finding a different buyer. Sheik Meshal sued UBS last year in the Dubai International Financial Centre courts, where UBS has offices, claiming he wasn't paid his fee. The written submission, which was reviewed by The Wall Street Journal, is his first direct testimony in the case. UBS denies the allegations and said in a statement that it is "vigorously defending this claim." Spain's Deficit Woes Seen Lingering (WSJ) In a report Tuesday, including economic projections for the next two years, the Bank of Spain said the economy will remain in recession, on average, this year, and contract around 1.5%—three times bigger than the government's own official projection. The discrepancy is because an economic uptick expected later this year is likely to be weaker than hoped. Atlantic City's Revel Casino Files for Bankruptcy (Reuters) Morgan Stanley originally owned most of Revel Entertainment Group, which began building the casino, but sold its stake at a $932 million loss in February 2011 to investors led by Kevin DeSanctis. The new owners then obtained a tax package of roughly $261 million from New Jersey and lined up $1.15 billion of financing to help complete the project. DeSanctis resigned earlier this month as Revel's chief executive. Hartmann, the interim chief executive, is a former chief executive of the Mohegan Sun casino in eastern Connecticut and has more than 20 years of experience in the gaming industry. Backers had hoped Revel would become the next Borgata, a joint venture between Boyd Gaming and MGM Resorts International that opened in 2003 and became Atlantic City's top-grossing casino. UBS: $62 million from Nasdaq is paltry compensation for Facebook IPO debacle (NYP) Nasdaq got approval from regulators yesterday to pay out $62 million to trading firms hurt by Facebook’s botched share sale — but UBS is having none of it. The Swiss bank giant has already filed an arbitration demand against Nasdaq, saying the payout doesn’t begin to cover the $356 million it lost because of the exchange’s “gross mishandling” of the IPO. Blackstone Ups Heat On Dell (WSJ) On Monday, a special committee of Dell board members said it viewed a Blackstone proposal as potentially superior to the $24.4 billion take-private offer from Silver Lake Partners and founder and Chief Executive Michael Dell. Investor Carl Icahn, who separately is pursuing the Round Rock, Texas, company, said on Monday he would review Blackstone's offer and may attempt to join forces with the New York firm. Fed Banker Backs Dialing Down Easy Money (WSJ) William Dudley, president of the Federal Reserve Bank of New York, said in a speech the Fed "should calibrate" how much U.S. debt and mortgage-backed securities it buys each month "by allowing the flow rate of purchases to respond to material changes in the labor market outlook." 'Stripper' in Jensen Beach arrested (TCPalm) St. Lucie County Sheriff's deputies March 10 went to the area of the 100 block of North El Mar Drive in Jensen Beach after a report of a woman in her underwear yelling profanities at a neighbor. They found Lisa Marie Paras, 29, in an "underwear like or bikini dress" drinking a Michelob Ultra at the end of a driveway, an affidavit states. A deputy told her to put down the beer. She said she was wearing a bikini. She also said she'd been yelling across the street because the folks there are "(rectal orifices)," an affidavit states. When a deputy tried to get more information, Paras said she's a "stripper and wanted to make me her witness," the affidavit states. Paras put her hands on the deputy's shoulders, and he told her she shouldn't touch him. Described as "obviously intoxicated," Paras tried to explain she faces trespassing charges because of her neighbors. She also thought her landlord stole cash from her bedroom. Meanwhile, the neighbors told investigators Paras came out to the road and started yelling obscenities at them as they cooked steaks on the grill. Paras, they said, was in her undies and drinking beer. Paras reportedly told a deputy she'd had eight to 12 beers. She said the people across the street are "(rectal orifices)" and are "(fornicated) up," an affidavit states. Paras, whose occupation is listed as a dancer, tried to hug a deputy when he asked her to confirm some contact information.

Opening Bell: 12.12.12

Three Questioned In Libor Probe (WSJ) While the SFO didn't identify the men, one of them is Thomas Hayes, a former trader at UBS and Citigroup, according to people familiar with the matter. Authorities in multiple countries have been looking into Mr. Hayes as an alleged coordinator of a group of employees at multiple banks who sought to manipulate the London interbank offered rate, or Libor, according to people familiar with the case. One of the others arrested was Terry Farr, an employee of British brokerage firm R.P. Martin Holdings Ltd. in London who is currently on leave from the firm, according to a person familiar with the case. Mr. Farr has been under investigation for possibly helping bank employees coordinate their efforts to influence Libor, according to people familiar with the case. HSBC Mexican Branches Said to Be Traffickers’ Favorites (Bloomberg) From 2006 to 2010, the Sinaloa cartel in Mexico and the Norte del Valle Cartel in Columbia moved more than $881 million in proceeds through HSBC’s U.S. unit, said Lanny Breuer, assistant attorney general for the U.S. Justice Department’s criminal division. Breuer, along with U.S. Attorney Lorretta Lynch in Brooklyn, New York, announced yesterday the bank had agreed to pay at least $1.9 billion to settle money laundering probes. “These traffickers didn’t have to try very hard,” Breuer said at a press conference in Brooklyn. “They would sometimes deposit hundreds of thousands of dollars in cash in a single day into a single account using boxes designed to fit the precise dimension of the tellers’ windows in HSBC’s Mexico branches.” It Could Get Hairy Before 'Cliff' Deal: Greenspan (CNBC) "The best possible outcome is to take something like Simpson-Bowles as it came out originally and work off that," he said, of a deal to avoid the automatic tax hikes and spending cuts that go into effect at the end of the year. But he said that reaching a final agreement won't be an easy process, since the president believes he has a mandate following the election while House Republicans believe they, too, have a mandate. "I'm not at altogether clear how much control (Speaker) Boehner has over the overall caucus," Greenspan said. "At the end of the day it will all work out but it's going to be a bit hairy before we get there." Buffett Joins Soros in Effort to Raise Taxes on Estates (Bloomberg) Billionaireinvestors Warren Buffett and George Soros are calling on Congress to increase the estate tax as lawmakers near a decision on tax policies that expire Dec. 31. In a joint statement Tuesday, Buffett, Soros and more than 20 other wealthy individuals asked Congress to lower the estate tax’s per-person exemption to $2 million from $5.12 million and raise the top rate to more than 45 percent from 35 percent. An estate tax structured this way will “raise significant revenue to reduce the deficit and fund vital services, will only be paid by the top one percent of estates, will raise more from the wealthiest estates” and will simplify compliance, said the statement. It also was signed by John Bogle, founder of mutual fund company Vanguard Group Inc., and former President Jimmy Carter. U.S. Probe of SAC Trading Said to Be Linked to 2010 Case (Bloomberg) A U.S. investigation of possible insider trading at SAC Capital Advisors LP, the $14 billion hedge fund run by Steven A. Cohen, is linked to a 2010 regulatory lawsuit over allegedly illegal trades in InterMune Inc, according to a person with knowledge of the matter. The Federal Bureau of Investigation and the Securities and Exchange Commission’s probe of trades that SAC Capital made in the Brisbane, California-based biopharmaceutical company is tied to a December 2010 SEC lawsuit against an investor, said the person, who asked not to be named because the matter isn’t public. The investor bought InterMune options before a European Union regulatory panel urged approval of the company’s drug Esbriet to treat a fatal lung disease, the person said, declining to elaborate. Man says law standing between him and sex acts with donkey is unconstitutional (NYDN) Lawyers representing the frisky farmhand thrown in jail for allegedly masturbating with a donkey are now fighting to have Florida’s statute banning sex with animals declared unconstitutional. “By making sexual conduct with an animal a crime, the statute demeans individuals like Defendant by making his private sexual conduct a crime,” attorneys for 32-year-old Carlos R. Romero wrote in a motion filed last week, the Ocala-Star Banner reported. Romero was cuffed at an Ocala farm back in September after farm proprietor Gerald James told police he saw Romero with his pants down as he was seemingly having sex with a donkey named Doodle in an equipment room on Aug. 15, according to police report obtained by thesmokinggun.com. Romero later pleaded not guilty to a first-degree misdemeanor charge of sexual activities involving animals. He announced last week that he wanted his case to go to trial. His attorneys argue that Florida’s statute violates the farmhand’s rights by stripping him of his “personal liberty and autonomy when it comes to private intimate activities.”They say the statute is unconstitutional because it doesn’t require the state to provide any proof of the animal’s suffering “or any proof of the sexual activity being non-consensual.” Inside The Risky Bets Of Central Banks (WSJ) While many national governments, including the U.S., have failed to agree on fiscal policy—how best to balance tax revenues with spending during slow growth—the central bankers have forged their own path, independent of voters and politicians, bound by frequent conversations and relationships stretching back to university days. If the central bankers are correct, they will help the world economy avoid prolonged stagnation and a repeat of central banking mistakes in the 1930s. If they are wrong, they could kindle inflation or sow the seeds of another financial crisis. Failure also could lead to new restrictions on the power and independence of central banks, tools deemed crucial in such emergencies as the 2008-2009 financial crisis. Freeport's $20 Billion Deal Stirs Backlash (WSJ) Freeport agreed last week to acquire energy explorers McMoRan Exploration Co. MMR +0.85% and Plains Exploration & Production Co. PXP -0.42% in transactions that will cost the Arizona mining giant about $20 billion including assumed debt. The deal will result in six directors with overlapping roles at Freeport and McMoRan Exploration receiving payouts for their shares totaling more than $130 million, according to securities filings. Some Freeport investors and analysts also have questioned the wisdom of a metals miner diving into the oil and gas business. They have taken issue with what they call conflicts of interests among the shared executives and directors at Freeport and McMoRan and the fact that the deal as structured doesn't require a Freeport shareholder vote. Fed Discourages Bank Dealmaking (WSJ) The Federal Reserve is pushing large U.S. banks to forget about all but the smallest acquisitions for a while amid a raging debate over the risk big lenders pose to the financial system. Man Drive 100 MPH To Wedding, Gets Arrested (Again) (NWI) Timothy N. Thompson, 23, of Valparaiso, was supposed to be married in a 7 p.m. ceremony. Instead, Thompson was arrested for resisting law enforcement, criminal recklessness and reckless driving. He was also cited for speeding and improper passing. According to police, an officer spotted Thompson about 6:30 p.m. Saturday speeding north in the center lane of Willowcreek Road. The officer estimated Thompson was driving 100 mph. Thompson allegedly continued to drive erratically, switching lanes abruptly and, according to the report, nearly wrecking. Police reported they followed Thompson as he turned into the parking lot of Nativity of Our Savior Church on Willowcreek Road, where he again nearly tipped over the Jeep Grand Cherokee. Once he entered the church's parking lot, three people -- later identified as relatives -- began flailing their arms and yelling at him. Thompson drove through the parking lot, accelerating and doing a "doughnut," creating a thick blanket of tire smoke, according to the report. When he stopped, Thompson told police he was late for his wedding and estimated he was doing "about 90" mph. He also told police he had his emergency flashers on and was sounding his horn to alert drivers. When an officer walked away from Thompson's vehicle, Thompson reentered his vehicle and drove toward the entrance of the church, where he was stopped by police again. "Oh, I thought you were done and I'm late for a party in Chicago," police reported Thompson saying. "It now means I have to drive really fast to get there." Thompson, who also told police he had just been released from jail that day, didn't make his wedding. He was transported to Porter County Jail and held without bond.

Opening Bell: 10.31.12

Questions Cloud Market Reopening (WSJ) The New York Stock Exchange said Tuesday that it plans to open as usual at 9:30 a.m. and that its trading floor and headquarters in lower Manhattan were "fully operational" despite widespread blackouts and flooding in that part of the city. The Nasdaq Stock Market and other exchanges will open as well. Bond markets will follow suit. While investors and industry officials breathed a sigh of relief, critics argued that the storm exposed how ill-prepared exchanges and their Wall Street customers are for such an event. Regulators on Tuesday said they plan to probe whether more needs to be done to get exchanges and the trading community ready for such disasters. After Hurricane, Wall Street Back To Work (Dealbook) On Tuesday, the scene around Wall Street was desolate. While the New York Exchange’s building appeared to be unscathed, many other offices in the vicinity were flooded. After an underground parking garage two blocks from the exchange was inundated with water, several cars floated to street level. Two Citigroup buildings were without power. The bank told employees in a memo on Tuesday that one of the buildings, 111 Wall Street, sustained “severe flooding and will be out of commission for several weeks.” Some JPMorgan Chase employees outside New York City were working in central New Jersey. At the bank’s main trading floor in Midtown Manhattan, employees, many in jeans, shirts and rain boots, booked hotels for the night and discussed strategy. The bank, which sustained minimal damages at a building downtown, expected to resume normal operations in Midtown. Credit Suisse also planned to open for business on Wednesday, with its main offices by Madison Square Park running on backup power. In downtown New York, Goldman Sachs was one of the few buildings with power. The firm has a generator in the event of outages, allowing its trading floors to continue to run. On Tuesday, televisions sets and lights inside the building were on, although few employees were there...In a memo to staff, Goldman announced its headquarters would be open on Wednesday. The firm also booked hotels in various locations to make sure employees could get to work. Deutsche Bank Rides Debt-Market Wave (WSJ) Deutsche Bank reported a surge in investment-banking revenues in the third quarter as a rebound in client activity fueled the best quarter ever for its fixed-income division. Deutsche Bank, Europe's largest lender by assets, reported group revenues of €8.7 billion ($11.5 billion), up 19% from the third quarter last year. The result was better than analysts expected, but the bank's legal problems and restructuring efforts nearly flattened net income. At €747 million, the total was up 3% from €725 million a year earlier. The bank's revenue increase was driven in part by bond-buying initiatives announced by the U.S. Federal Reserve and the European Central Bank in recent months. The moves have fueled a resurgence in client activity, including in fixed-income trading—an area where UBS AG and other competitors have announced significant cut backs, allowing Deutsche Bank to gain market share. UBS Moves Quickly On Job Cuts, Revamp (WSJ) Scores of traders at UBS were locked out of the Swiss bank's London offices Tuesday as the institution moved quickly to implement the first of thousands of job cuts in a strategic restructuring. The revamp effectively brings an end to UBS's attempts over the past two decades to build a world-class investment bank, which brought the institution to the brink of collapse in 2008 when it incurred more than $50 billion in losses from the fixed-income business that it is now exiting. Instead, UBS's strategy will center on its private bank, the world's second-largest in assets after Bank of America and a mainstay of the group's earnings. UBS confirmed Tuesday that it will cut risk-weighted assets by around 100 billion Swiss francs ($107 billion) by the end of 2017, eliminate about 10,000 jobs across the bank and reorganize its investment bank to deliver more products and services to ultra-wealthy clients at the private bank. The bank also said Tuesday that charges related to the moves, which come in response to a tougher regulatory and economic climate, helped push it into the red in the third quarter. UBS Chief Executive Sergio Ermotti said that London would bear the brunt of the cuts as the bank attempts to exit almost completely from fixed-income activities and move back to its wealth-management roots. Storm Cripples US East Coast, Death and Damage Toll Climb (CNBC) The U.S. death toll climbed to 50, according to The Associated Press, with many of the victims killed by falling trees. Damage estimates reached into the tens of billions, while the storm disrupted campaigning and early voting ahead of the November 6 presidential election. More than 8.2 million households were without power in 17 states as far west as Michigan. Nearly 2 million of those were in New York, where large swaths of lower Manhattan lost electricity and entire streets ended up under water. New York Subway System Faces Weeks to Recover From Storm (Bloomberg) If you laid the New York City subway system in a line, it would stretch from New York to Detroit. Now imagine inspecting every inch of that track. That’s the job ahead for Metropolitan Transit Administration officials, who must examine 600 miles of track and the electrical systems with it before they can fully reopen the largest U.S. transit system, which took a direct hit by Hurricane Sandy. Seven subway tunnels under New York’s East River flooded, MTA officials said. Pumping them out could take days, and a 2011 state study said it could take three weeks after hurricane- driven flooding to get back to 90 percent of normal operations. That study forecast damages of $50 billion to $55 billion to transportation infrastructure including the subways. How CEOs Improvised In The Wake Of Sandy (WSJ) When the approach of Hurricane Sandy left Lands' End Chief Executive Edgar Huber stranded on a business trip, he retreated to an impromptu backup headquarters—in his mother-in-law's apartment complex...Foot Locker CEO Ken Hicks disregarded the shutdown of his New York headquarters on Monday and worked at his office until 3 p.m. Then he picked up the work again six blocks away at his home in Manhattan's Murray Hill neighborhood. When the power went out, he put on iTunes, lit a lantern and did paperwork for another 2½ hours. "You can be reasonably self-sufficient with a cellphone and a lantern," the CEO says. Celebrities React To Northeast Hurricane (NYDN) “WHY is everyone in SUCH a panic about hurricane (i’m calling Sally)...?” Lindsay Lohan tweeted Sunday night. “Stop projecting negativity! Think positive and pray for peace.” A Year Later, All Eyes Still On 'Edie' (WSJ) Who broke the law by raiding customer accounts at MF Global Holdings? Investigators seem no closer to the answer than they were when the New York brokerage firm filed for bankruptcy exactly a year ago Wednesday, owing thousands of farmers and ranchers, hedge funds and other investors an estimated $1.6 billion. Their money was supposed to be stashed safely at MF Global, but company officials used much of it for margin calls and other obligations. The last, best hope for a breakthrough in the probe is Edith O'Brien, the former assistant treasurer at MF Global. Working in the company's Chicago office, she was the go-to person for emergency money transfers as MF Global flailed for its life. MBA's Rethink Wall Street (WSJ) Many of the nation's top M.B.A. programs, including Harvard Business School and Stanford Graduate School of Business, reported declines in the share of students who took jobs in finance this year. And even those that posted some gains, such as University of Pennsylvania's Wharton School, are still well below their prefinancial crisis levels...A Wall Street gig "isn't as prestigious as it used to be" because the future—promotion opportunities, salary gains, even basic job security— is so unclear, says Mark Brostoff, associate dean and director of the career center at the Olin Business School at Washington University in St. Louis. Though the share of Olin students going into finance increased to 22% of job seekers this year from 15% in 2011, many of those gains came at boutique and regional Midwestern financial firms rather than on Wall Street. One factor affecting student demand: Banks expect young staffers to pick up the slack left by masses of laid-off midlevel employees, without necessarily offering more generous pay packages in return for the long hours. At Harvard Business School, for example, students heading into investment banking—7% of job seekers who accepted jobs, down from 10% in 2011—reported median salaries and signing bonuses were flat with last year, at $100,000 and $40,000, respectively, while other guaranteed compensation fell to $8,750 from $40,000. Disney $4 Billion ‘Star Wars’ Deal Spotlights Content Bet (Bloomberg) Walt Disney agreed to buy George Lucas’s Lucasfilm Ltd. for $4.05 billion, pressing Chief Executive Officer Robert Iger’s $15 billion bet on creative franchises by adding “Star Wars” and “Indiana Jones.” Lucas, 68, the sole owner, will get half in cash and the rest in stock, making him a major investor in the film, theme park and TV company, according to a statement yesterday from Burbank, California-based Disney. The first of a new trilogy of “Star Wars” films will be released in 2015, Disney said. France Can’t Compete With Rest of Europe: WTO Chief (CNBC) France is uncompetitive not only versus China, but against the rest of Europe, according to Pascal Lamy, director general of the World Trade Organization. “The competitiveness of France on foreign markets has been damaged for the last 10 years. This is nowhere more obvious than in Europe, where France has lost market share for the last 10 years,” said Lamy in an exclusive interview with CNBC in Paris. Cop Tasers 10 Year-Old For Refusing To Clean His Car (CN) A New Mexico policeman Tasered a 10-year-old child on a playground because the boy refused to clean his patrol car, the boy claims in court. Guardian ad litem Rachel Higgins sued the New Mexico Department of Public Safety and Motor Transportation Police Officer Chris Webb on behalf of the child, in Santa Fe County Court. Higgins claims Webb used his Taser on the boy, R.D., during a May 4 "career day" visit to Tularosa New Mexico Intermediate School. "Defendant Webb asked the boy, R.D., in a group of boys, who would like to clean his patrol unit," the complaint states. "A number of boys said that they would. R.D., joking, said that he did not want to clean the patrol unit. "Defendant Webb responded by pointing his Taser at R.D. and saying, 'Let me show you what happens to people who do not listen to the police.'" Webb then shot "two barbs into R.D.'s chest," the complaint states. "Both barbs penetrated the boy's shirt, causing the device to deliver 50,000 volts into the boy's body.

Opening Bell: 12.19.12

UBS In $1.5 Billion Libor Fine (WSJ) As part of the deal, UBS acknowledged that dozens of its employees were involved in widespread efforts to manipulate the London interbank offered rate, or Libor, as well as other benchmark rates, which together serve as the basis for interest rates on hundreds of trillions of dollars of financial contracts around the world. UBS's unit in Japan, where much of the attempted manipulation took place, pleaded guilty to one U.S. count of fraud. Authorities on Wednesday painted a picture of "routine and widespread" attempts by UBS employees to rig Libor and the euro interbank offered rate, or Euribor. The U.K. Financial Services Authority said it had identified more than 2,000 such attempts between 2005 and 2010 with the participation or awareness of at least 45 UBS traders and executives. Regulators on Wednesday released a trove of internal UBS emails and other communications—many of them colorful and expletive-laden—in which bank traders, sometimes with the knowledge of their managers, sought to manipulate the rates in order to boost their trading profits or mask the Swiss bank's mounting financial problems in 2008. UBS Traders' 'Humongous' Libor-Fixing Boasts (CNBC) The FSA documents suggest a macho trading culture on the UBS trading floor. Trader A also said: "if you keep 6s [i.e. the six month JPY LIBOR rate] unchanged today ... I will ****ing do one humongous deal with you ... Like a 50,000 buck deal." Traders and brokers implicated in the scandal referred to each other as "the three muscateers [sic]" and "captain caos [sic]." SAC's top consumer trader draws scrutiny from U.S. authorities (Reuters) U.S. authorities are examining trading by one of SAC Capital Advisors' most successful portfolio managers, Gabriel Plotkin, as part of a probe into the $14 billion hedge fund firm's investment in Weight Watchers International Inc last year, according to a person familiar with the investigation. Plotkin, a specialist in consumer and retail stocks who makes investment decisions for more than $1.2 billion worth of assets, is among several SAC portfolio managers whose trades are being investigated, said the source, who did not want to be identified. The source would not name the other managers. Federal authorities are trying to determine whether any of SAC Capital's retail and consumer portfolio managers traded Weight Watchers shares based on non-public confidential information about the diet company, said the source and another person familiar with the investigation. The two sources said it is too soon to conclude if there was any insider trading. Authorities have not charged Plotkin with any wrongdoing. Banks See Biggest Returns Since ’03 as Employees Suffer (Bloomberg) Shareholders, impatient for the industry to boost profit, were rewarded as Wall Street firms cut jobs and pay, and exited businesses. The shrinking unnerved employees, who watched the chiefs of two big banks lose their jobs and others contend with a drop in deal making and stock trading, stiffer regulations, trading losses, rating downgrades and scandals involving interest-rate manipulation and money laundering. “There’s always grumbling on Wall Street, which is pathetic given how overpaid we all are, but there is a level of angst this year that is just unprecedented,” Gordon Dean, who left a 26-year career at Morgan Stanley (MS) to co-found a San Francisco boutique advisory firm this year, said in a telephone interview. “It’s just a profound sadness and dissatisfaction.” Greek Bond Bet Pays Off for Hedge Fund (FT) One of the world's most prominent hedge funds is sitting on a $500 million profit after making a bet that Greece would not be forced to leave the euro zone, bucking the trend in a difficult year for the industry. Third Point, headed by the billionaire US investor Dan Loeb, tendered the majority of a $1 billion position in Greek government bonds, built up only months earlier, as part of a landmark debt buyback deal by Athens on Monday, according to people familiar with the firm. The windfall marks out the New York-based firm as one of the few hedge fund managers to have profited from the eurozone crisis. Standard and Poor's, the rating agency, raised its assessment of Greece's sovereign debt by several notches on Tuesday, citing the euro zone's"strong determination" to keep the country inside the common currency area. Fitch Warns US Could Lose AAA If 'Fiscal Cliff' Hits (Reuters) "Failure to avoid the fiscal cliff.. would exacerbate rather than diminish the uncertainty over fiscal policy, and tip the US into an avoidable and unnecessary recession," Fitch said in its 2013 global outlook published on Wednesday. "That could erode medium-term growth potential and financial stability. In such a scenario, there would be an increased likelihood that the U.S. would lose its AAA status." Science explains Rudolph's red reindeer nose (CNET) A collection of Dutch scientists contributed to a paper titled "Microcirculatory investigations of nasal mucosa in reindeer Rangifer tarandus (Mammalia, Artiodactyla, Cervidae): Rudolph's nose was overheated." According to the paper, "The exceptional physical burden of flying with a sleigh with Santa Claus as a heavy load could have caused cerebral and bodily hyperthermia, resulting in an overworked nasal cooling mechanism that resembles an overheated cooling radiator in a car: Rudolph suffered from hyperemia of the nasal mucosa (a red nose) under more extreme heat loads during flight with a sleigh." Of course, scientists don't like to put all their scientific eggs into just one basket of science. The paper's authors acknowledge other theories for the red nose, including the common cold, alcoholic intoxication, or a parasitic infection of the nostrils. GM To Buy Back Stock From Treasury (WSJ) GM said it will purchase 200 million shares of stock held by the U.S. Treasury Department in the first step of the government's eventual exit from the auto maker within the next 12 to 15 months. The auto maker will pay $5.5 billion for the shares in a deal that is expected to close by the end of the year. The repurchase price of $27.50 a share represents a 7.9% premium over the closing price on Dec. 18. Berlusconi Says Italy May Be Forced to Leave the Euro Zone (Reuters) "If Germany doesn't accept that the ECB must be a real central bank, if interest rates don't come down, we will be forced to leave the euro and return to our own currency in order to be competitive," Berlusconi said in comments reported by Italian news agencies Ansa and Agi. Knight, Getco Confirm Merger (WSJ) The $1.8 billion deal for Knight, which values the firm at $1.4 billion plus $400 million in debt held by Getco, will create a trading powerhouse ranking as one of the largest players on U.S. exchanges and the main trading partner of online brokerage firms that service everyday investors. Porsche Executives Charged Over VW Bid (WSJ) Prosecutors have charged the former top executives of Porsche Automobil Holding SE with allegedly manipulating financial markets during the company's attempt to take over Volkswagen AG in 2008, lawyers representing the executives said Wednesday. A court in Stuttgart must now decide whether to open criminal proceedings against Porsche's former chief executive Wendelin Wiedeking and former finance chief Holger Härter, who are suspected of misleading investors when they denied trying to take over VW in 2008. Market manipulation in Germany can be punished with up to five years' imprisonment. From early March to October of 2008, Porsche issued at least five statements denying it was trying to raise its stake in Volkswagen to 75%, but the prosecutors allege that Messrs. Wiedeking and Härter had already decided to try to raise the stake and were preparing for the move by purchasing buy options on ordinary and preference shares of Volkswagen. The denials induced investors to sell or make bets the shares would fall by so-called short selling, the prosecutors said, which benefited Porsche by lowering the share price ahead of the planned takeover. Spanx Bandit On The Loose After JCPenney Heist (TSG) An unknown thief (or thieves) stole a whopping $4182 worth of the popular body shapers from a JCPenney in Vero Beach, according to an Indian River County Sheriff’s Office report. The Spanx theft was reported Friday afternoon after a JCPenney employee noticed “the empty rack in the women’s undergarment section.” The worker noted that the Spanx stock had been there the prior evening. A subsequent search of the store revealed that about 100 Spanx “were taken along with their plastic hangers.” The purloined undergarments--tan and black tops and bottoms--were from Spanx’s Assets Red Hot Label line, police reported. A JCPenney store manager gave cops an itemized list of the boosted body shapers, but it appears the Spanx Bandit will escape unscathed. Due to a lack of witnesses, evidence, or store surveillance video, no further investigative activity could be undertaken by a sheriff’s deputy.

Opening Bell: 01.25.13

Ex-Barclays CEO Diamond Is Named on Latest Libor-Lawsuit List (Bloomberg) Ex-Barclays Chief Executive Officer Robert Diamond and Former Chief Operating Officer Jerry Del Missier were among 25 bank employees anonymously referred to by regulators when the lender was fined for attempted interest rate rigging. Diamond and Del Missier were included on a second list released in a London court case linking Barclays staff to the London interbank offered rate. Judge Julian Flaux refused a request by some employees to prevent their names being published in connection to the case. Deutsche Bank Trader Fired Over Rate-Rigging Loses $53 Million (Bloomberg) Deutsche Bank's Christian Bittar, one of the firm’s best-paid traders, lost about 40 million euros ($53 million) in bonuses after he was fired for trying to rig interest rates, three people with knowledge of the move said. The lender dismissed Bittar in December 2011, claiming he colluded with a Barclays Plc (BARC) trader to manipulate rates and boost the value of his trades in 2006 and 2007, said the people, who requested anonymity because they weren’t authorized to speak publicly. His attempts to rig the euro interbank offered rate and similar efforts by derivatives trader Guillaume Adolph over yen Libor are the focus of the bank’s probe, the people said. Both traders declined to comment for this story. “Upon discovering that a limited number of employees acted inappropriately, we sanctioned or dismissed those involved and clawed back all of their unvested compensation,” Deutsche Bank spokesman Michael Golden said in a statement. “To date we have found no link between the inappropriate conduct of a limited number of employees and the profits generated by these trades.” Aleksey Vayner may have died of drug overdose (DM) The Yale student who catapulted to Internet infamy with a disastrous video resume he sent to a prospective employer died at his home in Queens, New York. Vayner passed away at the age of 29, according to the New York City Medical Examiner - and reports from relatives suggest that he may have experienced a drug overdose...In the video, titled 'Impossible is Nothing,' a gravely serious Vayner attempts to prove his mental and physical fitness by talking about the meaning of success while lifting 495-pound weights, smacking tennis balls faster than 140 miles per hour, ball-dancing with a scantily-clad woman and breaking seven bricks with his hand. 'Ignore the losers, bring your A-game, your determination and your drive to the field, and the success will follow you,' he says in the video. JPMorgan to Block Shareholder Vote on Bank Break-Up (Reuters) A federation of U.S. labor unions is looking to force JPMorgan Chase's board to consider breaking up the company after the disastrous "London Whale" affair, but the bank is trying to ensure that its shareholders do not get to vote on the union's proposal. The largest U.S. bank is seeking permission from the U.S. Securities and Exchange Commission to omit the proposal from the measures that shareholders vote on this spring,according to a letter sent to the agency on January 14. The proposal, from the AFL-CIO's Reserve Fund, a union fund that owns JPMorgan shares, calls on bank directors to form a committee that would explore "extraordinary transactions that could enhance stockholder value," including breaking off one or more of the company's businesses. As Cohen parties in Davos, legal eagles circle at home (NYP) Hedge-fund titan Steve Cohen took a break from battlinginvestor redemptions to hob-knob with other heavyweights at the World Economic Forum in Davos Switzerland. But Cohen, who runs $14 billion Stamford, Conn., hedge-fund giant SAC Capital, could be facing more trouble when he gets home. At least one class-action law firm is trying to rustle up investors to sue SAC for its ties to an alleged insider-trading scheme that led to the arrest of a former portfolio manager. Wilmington, Del.-based Chimicles & Tikellis posted a notice on its website saying it is seeking SAC investors and limited partners and is “actively investigating a proposed investor lawsuit against SAC Capital.” Any resulting lawsuit would be pegged to SAC’s “mismanagement of the limited partnership and certain hedge funds.” Wisconsin Man Wearing "Breathalyzer" T-Shirt Arrested For Sixth Time For Drunk Driving (TSG) The 30-year-old was arrested early Saturday morning for drunk driving after he was found passed out at the wheel of a Chevrolet Cavalier that was parked with its engine running in the middle of a Wisconsin road. Wendler, who reeked of intoxicants, failed a series of field sobriety tests and appeared “dazed and confused,” according to a Marathon County Sheriff’s Department report, which noted that a deputy spotted an unopened six-pack of beer on the vehicle’s passenger seat. A breath sample recorded Wendler’s blood alcohol content as .19, more than twice the legal limit. As a result, he was charged with operating a motor vehicle while intoxicated--the sixth time he has been busted for drunk driving. Wendler’s extensive DWI history, of course, makes his t-shirt choice a strange one. As seen in his mug shot, Wandler was nabbed while wearing a shirt referencing drinking and a “free Breathalyzer test.” The shirt also includes an arrow (beneath the words “blow here”) pointing downward toward Wendler’s crotch. Financial Job Losses Near Four-Year High as Europe Leads (Bloomberg) Financial-services firms are on track to cut the most jobs in January since the start of 2009 as Europe struggles to emerge from the debt crisis and regulators impose tougher capital rules. The 16,040 announced and expected reductions in the past three weeks are just short of the 16,389 cuts made in the industry during January 2009 after Lehman Brothers Holdings Inc. collapsed, according to data compiled by Bloomberg. Bankers and consultants expect the cuts to accelerate in coming months even as financial stocks gained 26 percent last year. Credit Bubble Seen in Davos as Cohn Warns of Repricing (Bloomberg) Goldman Sachs President Gary Cohn warned of a potential drop in fixed-income prices as bankers and policy makers in Davos celebrated surging demand for financial assets. Debt markets that have seen junk-bond yields drop to record lows may face a “substantial repricing” if interest rates spike or investors begin pulling money out of fixed income, Cohn, 52, said in an interview yesterday with Bloomberg Television’s Erik Schatzker at the World Economic Forum in Davos, Switzerland. Morgan Stanley CEO To Take Pay Cut (WSJ) Morgan Stanley disclosed Thursday that Mr. Gorman would receive about $2.6 million in stock options for 2012. All told, he will receive $6 million in salary, cash and stock for the year, said a person familiar with the company's compensation plans, plus participation in an incentive plan whose value wasn't disclosed. His full pay package won't be disclosed until this spring's proxy statement. Thousands of crocodiles on loose after floods hit South African farm (The Guardian) Around 15,000 crocodiles made the great escape from the Rakwena crocodile farm near the border with Botswana on Sunday, according to the newspaper Beeld. Although "a few thousand" have since been recaptured, including one at a school rugby ground 75 miles away, more than half of the reptiles are still at large.