Opening Bell: 04.19.13

Blackstone Pulls Out of Dell Bid on Falling PC Sales (Bloomberg) In a letter to Dell’s board, Blackstone cited an “unprecedented” 14 percent market decline in PC volume in the first quarter, according to a statement today. The world’s biggest buyout firm made a non-binding offer to acquire Dell last month, rivaling a $24.4 billion joint bid by founder Michael Dell and Silver Lake Management LLC, the largest proposed leveraged buyout since the financial crisis. Fed Officials Back Higher Capital (WSJ) A pair of Federal Reserve officials suggested Wednesday that major financial institutions may need to hold even higher levels of capital, a sign of a growing concern over the efficacy of current regulatory efforts to address the risks posed by large, complex firms. AIG wins bid to transfer Bank of America mortgage lawsuit (Reuters) A federal appeals court ruled in favor of American International Group in concluding that the insurer's $10 billion lawsuit against Bank of America Corp over mortgage losses belongs in state court, not federal court. The 2nd U.S. Circuit Court of Appeals on Friday threw out a lower court order denying AIG's bid to move the case to a New York state court. AIG's lawsuit was filed in August 2011 but has been largely on hold because of the venue fight. German Banker Warns Crisis Far From Over (WSJ) Germany's top central banker warned that Europe's debt crisis would take as much as a decade to overcome, adding that a lasting solution would only come once politicians stopped relying on the European Central Bank and pushed through far-reaching structural overhauls. Frustrated by delay, Georgia cop allegedly pulled gun in McDonald’s drive-thru line (NYDN) Student Ryan Mash, 18, was waiting for his order at the drive-thru window of a Forsyth County McDonald's when he was taken by surprise — and it was not a Happy Meal toy. It was a gun allegedly brandished by Sgt. Scott Biumi, 48, a member of the DeKalb County Police Department for more than 20 years, authorities suspect. Biumi apparently grew frustrated that the fast food experience was not faster, so he stepped out of his car and yelled, "Stop holding up the drive-thru line," according to Mash. Mash claims Biumi thought his sincere apology was sarcastic. Then witnesses reported hearing Biumi scream, "You don't know who you are (messing) with!" "And that's when he pulled the gun on me," Mash said, "and kept on yelling at me for about 30 more seconds. And then walked off." European Fund Managers Seen Doubling Salaries on Bonus Caps (Bloomberg) About three-quarters of mutual fund managers’ total compensation is from bonuses and long-term incentives, meaning salary increases of 50 percent to 100 percent would be needed to negate the cap, said Jon Axcell, head of asset management at London-based Morgan McKinley. A European Parliament committee last month proposed to limit fund managers’ bonuses to no more than base salaries. Gorman Gains on Blankfein in Bet on Brokerage (Bloomberg) Morgan Stanley’s reputation as Wall Street’s weakest link is diminishing in debt markets as Chief Executive Officer James Gorman’s bet on a brokerage unit that has amassed $1.78 trillion in client assets starts to pay off. The cost of credit-default swaps protecting investors against losses on Morgan Stanley’s debt is about the lowest relative to the bank’s peers in almost two years, with the gap between it and its closest rival, Goldman Sachs, narrowing to 14 basis points from as wide as 111 last year, prices compiled by Bloomberg show. Private Equity Groups Renew Listing Plans (FT) More than a dozen offerings this year have rekindled private equity groups' hopes to list some of their largest assets bought during the bubble. The initial public offering of Intelsat on Thursday shows that it is feasible, but can also be painful. Drunk man tossed from hotel, accused of stealing shuttle (K11) Bloomington Police say a man tossed from a local hotel for being drunk early Wednesday morning made matters worse when he commandeered the hotel's shuttle van and crashed it into a stand of trees. Commander Kevin Herman says officers were called to the Quality Inn and Suites at 814 E. American Boulevard around 3 a.m. on reports of a drunk man causing a commotion. Staff members told officers they asked the man to leave about the time the hotel shuttle pulled up to the entrance. Witnesses say when the driver left the keys in the ignition and ran inside the drunk man ran out, jumped in the van and stole it.
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Boston Is Locked Down With City Frozen From Tufts to Trains (Bloomberg)
Boston area residents awoke to a city virtually paralyzed after a night of mayhem that left at least two dead and police searching house to house for a suspect believed to be responsible for the Boston Marathon bombings. As dawn broke over the city, police had already ordered a shutdown of all public transit in the region while officers armed with assault rifles conducted a search in Watertown, 10 miles west of downtown Boston, looking for Dzhokar Tsarnaev, a 19-year-old foreign national who had escaped during a confrontation with police. Governor Deval Patrick ordered businesses closed in Watertown, Newton, Waltham, Belmont, Cambridge and Boston, while area schools from Harvard University to the Massachusetts Institute of Technology and Boston College canceled classes. Companies that have told employees to stay home included Athenahealth, Merck & Co. and Pfizer Inc. “I’m watching CNN and looking at the streets around our office,” said Guy Macdonald, the CEO of Tetraphase Pharmaceuticals in Watertown. “It looks like a movie around our office right now.” Tsarnaev ran over the other suspect, his older brother Tamerlan, during the shoot-out in Watertown, according to a federal law enforcement official.

Blackstone Pulls Out of Dell Bid on Falling PC Sales (Bloomberg)
In a letter to Dell’s board, Blackstone cited an “unprecedented” 14 percent market decline in PC volume in the first quarter, according to a statement today. The world’s biggest buyout firm made a non-binding offer to acquire Dell last month, rivaling a $24.4 billion joint bid by founder Michael Dell and Silver Lake Management LLC, the largest proposed leveraged buyout since the financial crisis.

Fed Officials Back Higher Capital (WSJ)
A pair of Federal Reserve officials suggested Wednesday that major financial institutions may need to hold even higher levels of capital, a sign of a growing concern over the efficacy of current regulatory efforts to address the risks posed by large, complex firms.

AIG wins bid to transfer Bank of America mortgage lawsuit (Reuters)
A federal appeals court ruled in favor of American International Group in concluding that the insurer's $10 billion lawsuit against Bank of America Corp over mortgage losses belongs in state court, not federal court. The 2nd U.S. Circuit Court of Appeals on Friday threw out a lower court order denying AIG's bid to move the case to a New York state court. AIG's lawsuit was filed in August 2011 but has been largely on hold because of the venue fight.

German Banker Warns Crisis Far From Over (WSJ)
Germany's top central banker warned that Europe's debt crisis would take as much as a decade to overcome, adding that a lasting solution would only come once politicians stopped relying on the European Central Bank and pushed through far-reaching structural overhauls.

Frustrated by delay, Georgia cop allegedly pulled gun in McDonald’s drive-thru line (NYDN)
Student Ryan Mash, 18, was waiting for his order at the drive-thru window of a Forsyth County McDonald's when he was taken by surprise — and it was not a Happy Meal toy.
It was a gun allegedly brandished by Sgt. Scott Biumi, 48, a member of the DeKalb County Police Department for more than 20 years, authorities suspect. Biumi apparently grew frustrated that the fast food experience was not faster, so he stepped out of his car and yelled, "Stop holding up the drive-thru line," according to Mash. Mash claims Biumi thought his sincere apology was sarcastic. Then witnesses reported hearing Biumi scream, "You don't know who you are (messing) with!" "And that's when he pulled the gun on me," Mash said, "and kept on yelling at me for about 30 more seconds. And then walked off."

European Fund Managers Seen Doubling Salaries on Bonus Caps (Bloomberg)
About three-quarters of mutual fund managers’ total compensation is from bonuses and long-term incentives, meaning salary increases of 50 percent to 100 percent would be needed to negate the cap, said Jon Axcell, head of asset management at London-based Morgan McKinley. A European Parliament committee last month proposed to limit fund managers’ bonuses to no more than base salaries.

Gorman Gains on Blankfein in Bet on Brokerage (Bloomberg)
Morgan Stanley’s reputation as Wall Street’s weakest link is diminishing in debt markets as Chief Executive Officer James Gorman’s bet on a brokerage unit that has amassed $1.78 trillion in client assets starts to pay off. The cost of credit-default swaps protecting investors against losses on Morgan Stanley’s debt is about the lowest relative to the bank’s peers in almost two years, with the gap between it and its closest rival, Goldman Sachs, narrowing to 14 basis points from as wide as 111 last year, prices compiled by Bloomberg show.

Private Equity Groups Renew Listing Plans (FT)
More than a dozen offerings this year have rekindled private equity groups' hopes to list some of their largest assets bought during the bubble. The initial public offering of Intelsat on Thursday shows that it is feasible, but can also be painful.

Drunk man tossed from hotel, accused of stealing shuttle (K11)
Bloomington Police say a man tossed from a local hotel for being drunk early Wednesday morning made matters worse when he commandeered the hotel's shuttle van and crashed it into a stand of trees. Commander Kevin Herman says officers were called to the Quality Inn and Suites at 814 E. American Boulevard around 3 a.m. on reports of a drunk man causing a commotion. Staff members told officers they asked the man to leave about the time the hotel shuttle pulled up to the entrance. Witnesses say when the driver left the keys in the ignition and ran inside the drunk man ran out, jumped in the van and stole it.

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Opening Bell: 12.06.12

Diamondback to Close Down as Investors Pull $520 Million (WSJ) Diamondback Capital Management LLC, among the hedge funds that was raided by the FBI about two years ago as part of the U.S. investigation of insider trading on Wall Street, is liquidating after clients pulled money. The Stamford, Connecticut-based fund received requests from investors to withdraw about $520 million, or 26 percent of its assets, co-founders Richard Schimel and Lawrence Sapanski, said today in a client letter. They said they plan to return the majority of the money next month. “We especially appreciate your patience and support during the last two difficult years during which we reached closure of the government’s investigation,” they said in the letter. SEC Probes Deutsche Bank (Bloomberg) U.S. securities regulators are investigating allegations that Deutsche Bank hid billions of dollars of paper losses during the financial crisis, according to people close to the investigation. The German bank said Wednesday that the allegations, by three former U.S.-based employees, were "wholly unfounded" and had been the subject of a "careful and thorough" review it had commissioned. The former employees have told the Securities and Exchange Commission that traders at Deutsche Bank overvalued a portfolio of derivatives to hide rapidly mounting losses when financial markets were collapsing in 2008, the people close to the investigation said. The details of the allegations were reported by the Financial Times on Wednesday. Wall Street Job Reductions Seen Persisting After Citigroup Cuts (WSJ) Wall Street’s cost cuts and dismissals, which have helped erase more than 300,000 financial- industry jobs in the past two years, are far from over. Citigroup's announcement yesterday of plans to eliminate 11,000 positions in units spanning equities trading to consumer banking is the latest sign of strain from a market slowdown, stiffer capital rules and weak economic growth. Lenders around the globe are likely to trim more jobs if revenue doesn’t rebound sharply next year, analysts and recruiters said. “The knives are sharpened and ready,” said Jason Kennedy, chief executive officer of London-based search firm Kennedy Group. “These institutions are too big for the business they are generating but they are still quite bullish that the market will return by mid-2013. Unless the markets picks up, there will be more cuts in the first half.” Broadening Tax Base and Raising Rates Key to 'Cliff' Deal: Summers (CNBC) The wiggle-room in the "fiscal cliff" negotiations comes down to a balanced approach on raising tax rates for wealthier Americans and broadening the tax base by closing loopholes and deductions, former Clinton Treasury Secretary Lawrence Summers told CNBC. "The president is not signing legislation — no way — that does not raise tax rates. The president has been clear as day," Summers said Thursday on "Squawk Box." Summers also pointed out that President Barack Obama isn't married to repealing the Bush tax cuts for the top 2 percent of wage earners all the way back to the Clinton-era tax rates of 39.6 percent. So rates might not go that high if there's sufficient revenue coming from the base-broadening side of the equation. Geithner: Ready to Go Over 'Cliff' If Taxes Don't Rise (CNBC) Treasury Secretary Timothy Geither told CNBC Wednesday that Republicans are "making a little bit of progress" in "fiscal cliff" talks but said the Obama administration was "absolutely" ready to go over the cliff if the GOP doesn't agree to raise tax rates on the wealthy. "I think they're making a little bit of progress," Geithner said. "They're clearly moving and figuring out how to try to move further." But Geithner said the White House would "absolutely" go over the fiscal cliff — triggering over $600 billion in automatic spending cuts and tax increases — unless tax rates increase on the top 2 percent of wage earners. Steinberg Is Eyed In SAC Trial (NYP) Prosecutors yesterday confirmed the worst-kept secret in the insider-trading trial unfolding in Manhattan federal court: They view former SAC Capital money manager Michael Steinberg as a co-conspirator in the case. Prosecutor Antonia Apps argued yesterday that Steinberg, a portfolio manager with SAC’s Sigma Alpha unit, should be officially labeled a co-conspirator in the case because he knew his former analyst, John Horvath, was receiving illegal tips on computer-maker Dell. The government has already alluded to Steinberg’s alleged role in earlier court documents, when it referred to four unnamed co-conspirators, including “the portfolio manager to whom Jon Horvath reported at his hedge fund.” That person is Steinberg. New Zealand Dogs Learn How to Drive (ABC) Who says you can’t teach an old dog new tricks? Not the New Zealand chapter of the Society for the Prevention of Cruelty to Animals (SPCA), which has launched a marketing campaign featuring dogs — real dogs — learning how to drive. Really. SPCA Auckland chose three abandoned dogs — Monty, Ginny and Porter — and put them behind the wheel of a car to show that rescue dogs are a first-rate choice for adoptions. “I think sometimes people think because they’re getting an animal that’s been abandoned that somehow it’s a second-class animal,” SPCA Auckland’s CEO, Christine Kalin, told the New Zealand Herald. “Driving a car actively demonstrates to potential rescue dog adopters that you can teach an old dog new tricks.” The trio of highway-ready rescue dogs was chosen by SPCA two months ago and then relocated to Animals on Q, a “premiere New Zealand animal talent agency,” according to its website, to begin their “doggy driver training process,” the Herald reported. The dogs have trained for the past eight weeks under the supervision of Animals on Q owner Mark Vette. Next week one of the dog’s skills will be put to the test in front of a live national TV audience. Porter, a 10-month-old Beardie Cross and the star among the three pups, will drive a Mini Countryman on the “Campbell Live” program on New Zealand’s 3 News, the station reported in a sneak peek that aired last night. The TV appearance will mark the first time that Porter, or any of the other pups, drives without human assistance. While training, Porter — along with Monty, an 18-month Giant Schnauzer, and, Ginny, a 1-year-old whippets cross — used a canine-modified Mini, but had human help in the form of steering wheel adjustments and verbal commands. Nasdaq drops ball on IPO — again (NYP) The electronic exchange run by CEO Robert Greifeld was forced yesterday to cancel orders on a planned $100 million initial public offering of WhiteHorse Finance due to “human error,” a Nasdaq spokesman said. A staffer in the exchange’s market-watch department “inadvertently” pressed a button to cancel trading rather than to delay the launch of the company. Standard Chartered to Pay Additional $330 Million in Iran Settlement (WSJ) Standard Chartered said Thursday it expects to pay an additional $330 million to settle with U.S. authorities over past transactions with Iranian clients that may have violated U.S. sanctions, putting its total bill at around $670 million. Madam Set To Name NFL Big (NYP) Notorious Upper East Side madam Anna Gristina is about to start naming names of high-power clients from her little black book — and an unlucky NFL executive will be the first bombshell name she lets fly, we’re told. “There is going to be a giant name dropped — actually, a couple of them,” Gristina told The Post’s Laura Italiano, speaking of her plans for an upcoming interview with TV host psychologist Dr. Phil. Asked if those names would be “giant” with a capital “G,” the Hockey Mom Madam gave a distinctly mischievous laugh that portends bad news for the bigwig client...“Everyone’s going to have to watch Dr. Phil,” she said. “I will tell you that one of the names is high-level [NFL] management. Then there’s an older [football] player who’s still very well known. Tune in to Dr. Phil!” Jobless Claims Fall (Reuters) Initial claims for state unemployment benefits dropped 25,000 to a seasonally adjusted 370,000, the Labor Department said on Thursday. The prior week's figure was revised to show 2,000 more applications than previously reported. EU Pushes Crackdown On Tax Havens (WSJ) The European Union's executive Thursday moved to step up efforts against tax havens, encouraging members to name and shame ultra-low-tax jurisdictions and crack down on cross-border tax avoidance within the 27-nation bloc. Guatemalan Police Arrest Software Guru McAfee (AP) Software company founder John McAfee was arrested by police in Guatemala on Wednesday for entering the country illegally, hours after he said he would seek asylum in the Central American country. The anti-virus guru was detained at a hotel in an upscale Guatemala City neighborhood with the help of Interpol agents and taken to an old, three-story building used to house migrants who enter the country illegally, said Interior Minister Mauricio Lopez Bonilla. It was the latest twist in a bizarre tale that has seen McAfee refuse to turn himself in to authorities in Belize, where he is a person of interest in the killing of a neighbor, then go on the lam, updating his progress on a blog and claiming to be hiding in plain sight, before secretly crossing the border into Guatemala. "He will be in danger if he is returned to Belize, where he has denounced authorities," said his lawyer in Guatemala, Telesforo Guerra. "His life is in danger." Guerra said he would ask that a judge look at McAfee's case as soon as possible. "From them moment he asked for asylum he has to have the protection of the Guatemalan government." Earlier Wednesday, McAfee said he had formally requested asylum in Guatemala after entering the country from Belize, where he says he fears for his safety because he has sensitive information about official corruption and refused to donate to local politicians. "Yes, we are presenting this, and I want it to be clear, because of the persecution, not because of the murder," he told the AP about his asylum bid.

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.

Opening Bell: 03.07.13

Fed's Fisher Pins Slow Growth on Politicians (WSJ) Federal Reserve Bank of Dallas President Richard Fisher on Wednesday blamed both major U.S. political parties for a "horrid" political climate in Washington, and said monetary policy alone can't drive the economy. "We provided the fuel for economic recovery," Mr. Fisher said of the central bank, describing the Fed's stimulus as "very high-octane, dirt-cheap gasoline." But he said that neither Republican nor Democratic politicians in Washington have done their part by putting policies in place that spur the private sector "to take the cheap fuel that we have provided and step on the accelerator." Banks Said to Weigh Defying Fed With Dividend Disclosures (Bloomberg) The largest U.S. banks are weighing whether to disregard a Federal Reserve request and announce their dividend plans shortly after the central bank’s stress tests are released, people with knowledge of the process said. The Fed has asked 18 firms, including JPMorgan and Goldman Sachs, to wait until next week, even though the lenders will get preliminary word today about whether their capital plans were approved. Bank executives are concerned that investors could be confused and are considering whether securities laws may require prompt disclosure of their plans for dividends and share repurchases, the people said. Paulson Gold Fund Down 18% as Metal’s Slump Foils Rebound (Bloomberg) John Paulson posted an 18 percent decline in his Gold Fund last month as a slump in the metal, after more than a decade of gains, undermined efforts by the billionaire hedge-fund manager to rebound from two years of losses in some strategies. The $900 million Gold Fund, which invests in bullion- related equities and derivatives, is down 26 percent this year, Paulson & Co. said yesterday in a client update obtained by Bloomberg News. The firm’s Advantage funds also fell in February after the metal and related stocks weakened as signs of economic optimism curbed gold demand. “Despite the volatility and drawdown of our gold equity positions, we believe in the long-term outlook for these positions as quantitative easing programs continue around the world, credit expands in the United States, and gold equities continue to trade at a significant discount” to historical average valuations, the hedge fund said in a letter sent yesterday to investors, which was obtained by Bloomberg News. Carl Icahn Rachets Up Dell Fight (WSJ) In a letter released by Dell Thursday, Mr. Icahn said he has a "substantial" position in the company, and asked Dell to pay a per-share dividend of $9 if the deal is voted down by shareholders. He said that by his calculations, that transaction would be superior to the current going-private offer, citing a "stub" value of $13.81 a share which, combined with the special dividend, represents a 67% premium to the current $13.65 per-share offer price. Dell 'Welcomes' Carl Icahn to Go-Shop Process (CNBC) Dell on Thursday said it welcomed Carl Icahn, who has built up a 100 million share stake in the company, and other interested parties as the computer maker seeks to go private. The special committee appointed by the board said it was conducting a "robust go-shop process" and was looking at other alternatives after a $24.4 billion buyout led by founder Michael Dell faced opposition from some shareholders. Bad-News Bears Crash The Party (WSJ) For all their conviction, the bears realize it may be awhile before their dark predictions come true. "Unfortunately, I am bearish and I have been wrong," said Samer Nsouli, chief investment officer at Lyford Group International, a hedge fund, who argues that recent weakness in copper and oil is a portent of a global slowdown. "Make no mistake, it will end in tears. The eternal question is when." Lions Maul Two To Death In Kariba (Herald) Two people were yesterday mauled to death by lions in Mahombekombe suburb in the resort town of Kariba. Sources say the man only identified as Musinje and the woman Sharai Mawera, were attacked while spending time in a bushy area with the man managing to escape, leaving the woman behind. The man went on to report the case to police who, with the assistance of officers from the Zimbabwe Parks and Wildlife Management Authority, went in search of the lions. During the search they found an arm belonging to a man with investigations pointing to the lions having made a kill the previous night. That, the sources say, could have been the reason the lions did not completely eat the woman. BofA Times An Options Trade Well (WSJ) Bank of America's trading desk last June purchased options to buy 150,000 shares of Constellation Brands, an aggressive wager that the wine-and-beer seller's shares would rise, according to a Wall Street Journal analysis of options-market data and of quarterly regulatory filings made by institutional investors. The trade helped push the volume in thinly traded Constellation options that day to more than 13 times the previous 30 days' daily average, the options data show. A week later, Constellation announced a pact to buy a Mexican beer maker out of a joint venture that imports Corona Extra and other beers into the U.S. market. Bank of America led a duo of banks that financed the $1.85 billion deal. Constellation shares soared 24% on June 29, the day the deal was made public, and Bank of America generated an estimated paper profit of more than $1 million from the options trading, the options-market data indicate. China Imitates Singer (NYP) Paul Singer’s battle with Argentina over defaulted debt is beginning to ripple through the bond world. Creditors looking to force deadbeat countries to pay up are turning to the controversial legal argument Singer used to press his case against the South American country in the US courts. On Monday, China’s Ex-Im Bank, which has an unpaid judgment worth $32 million against Grenada, sued the tiny Caribbean country in New York federal court to get its money back. China wheeled out the same “equal treatment” argument that Singer’s Elliott Management used against Argentina, and which was recently upheld at the appeals level for the first time in the US. China’s move marks the first time a creditor other than Singer and his cohorts have tested the maneuver in the US. Obama Tries Charm Offensive to Woo Republicans on Deficit (Bloomberg) The president broke bread last night with a dozen Republican senators, hosting a dinner at a luxury Washington hotel near the White House. Next week, he’ll visit Capitol Hill to meet separately with Republicans and Democrats in the Senate. Obama has also spoken by telephone with at least a half- dozen Republican lawmakers over the past few days about the budget and other priorities of his second term, including a rewrite of immigration laws and controlling gun violence. “There have been some problems, but we’re all adults and you just have to put the country ahead of party and you’ll be fine,” Senator Lindsey Graham of South Carolina, who helped organize the dinner, said before the meal. The increased outreach marks a shift in strategy for the White House, amid signs the president’s poll numbers are falling after he and Republicans were unable to avert the across-the- board spending cuts that took effect March 1. Jobless Claims in U.S. Unexpectedly Fall to a Six-Week Low (Bloomberg) First-time jobless claims unexpectedly fell by 7,000 to 340,000 in the week ended March 2, the lowest since the period ended Jan. 19, according to data today from the Labor Department in Washington. The median forecast of 50 economists surveyed by Bloomberg called for an increase to 355,000. The four-week average dropped to a five-year low. JC Penney Board Can’t Be 'Delusional': Ex-CEO (CNBC) Former JC Penney CEO Allen Questrom told CNBC on Wednesday that the company's board of directors is wrong in thinking the struggling retailer can change its fortunes under current boss Ron Johnson. "The board has to take action. They can't be delusional like Ron Johnson is," Questrom said on "Fast Money Halftime Report." "This has been going on long enough. You can't say you're going to make your numbers for the year and then drop a billion dollars." Questrom, who has watched from afar as Penney's sales and stock have suffered, told CNBC that directors needed to act quickly. "If they think if it all of a sudden going to turn itself around, there is no way they can have reliable information – because Ron is not a source for that," he said. "The sooner they act, the better." 1 in 10 Yale students have engaged in prostitution, 3% have had sex with an animal (NYDN) Sexologist Dr. Jill McDevitt hosted the sex workshop session where around 55 students used their cellphones to answer questions about sex. The results were then published in real time on a screen. McDevitt, who also owns the Feminique sex store in West Chester, Pennsylvania, said the results showed "you can't have assumptions about people's backgrounds." Student Giuliana Berry, who hosted the event, told Campus Reform the workshop - part of Yale's Sex Weekend - aimed to increase understanding and compassion for people who indulged in "fringe sexual practices."

Opening Bell: 03.19.13

BlackRock To Layoff Nearly 300 Employees (Reuters) BlackRock President Rob Kapito told employees on Monday that despite the layoffs the firm, which oversees almost $4 trillion, would continue hiring and expected to end 2013 with more employees than it currently had. "These moves will give high potential employees greater responsibility and additional career opportunities, and will make us a more agile organization better positioned to respond to changing client and market needs," Kapito said in the memo. Blackstone Said to Mull Outbidding Silver Lake for Dell LBO (Bloomberg) Blackstone is weighing a bid for Dell, the computer maker seeking offers to rival the proposed $24.4 billion buyout by its founder and Silver Lake Management LLC, said people with knowledge of the matter. Blackstone may bid as part of a group including other investors, said one of the people, who asked not to be named because the process is confidential. The New York-based private- equity firm hasn’t made a decision, another person said. Under the go-shop provision of the Silver Lake merger agreement, Dell’s board has through March 22 to seek superior proposals, and can negotiate beyond that date if it receives an offer it deems serious. Fannie Sees A Way To Repay Billions (WSJ) The rebounding housing market has helped return Fannie Mae to profitability and now might allow the government-controlled mortgage-finance company to do the once unthinkable: repay as much as $61.5 billion in rescue funds to the U.S. Treasury. The potential payment would be the upshot of an accounting move that Fannie Mae's senior executives are looking to make whereby the company would reclaim certain tax benefits that were written down shortly after the company was placed under federal control in 2008. The potential move was disclosed last week in a regulatory filing in which the company said it would delay the release of its annual report, due by Monday, as it tries to reach resolution with its accountants and regulator over the timing of the accounting move. UBS becomes latest bank to quit Euribor rates panel (Reuters) UBS said it would pull out of money market rate Euribor, one of the most prominent banks to do so after a global benchmark rate-setting scandal, in a move that renews questions about the rate's future. "We have decided to withdraw from the Euribor panel and to focus on our core funding markets Swiss franc and U.S. dollar," a UBS spokesman said, adding the decision was linked to an October decision to shut down vast parts of its investment bank. Lululemon Pulls Yoga Pants From Stores (WSJ) The yoga-apparel retailer's shares tumbled late Monday after saying it has pulled some of its popular pants from stores, after a mistake by a supplier left the pants too see-through. Lululemon Athletica said the glitch involved pants using its signature fabric, known as Luon, that arrived in stores March 1. The retailer is offering refunds to customers. Citigroup to Pay $730 Million in Bond-Lawsuit Settlement (Bloomberg) The deal would resolve a lawsuit by investors who bought Citigroup bonds and preferred stock from May 2006 through November 2008, the New York-based lender said yesterday in a statement. The accord requires court approval and would be covered by existing litigation reserves, the bank said. Ex-Calpers CEO Buenrostro Indicted Over Apollo Investment (Bloomberg) Federico Buenrostro, former chief executive officer of the California Public Employees’ Retirement System, was charged with conspiring to trick the pension fund into paying millions of dollars in fees for a $3 billion investment into funds managed by Apollo Global Management. Buenrostro, 64, who led the state’s public pension fund from 2002 to 2008, was accused along with Alfred Villalobos, 69, of conspiracy to defraud the U.S., engaging in a false scheme against the U.S. and conspiracy to commit mail fraud and wire fraud in a grand jury indictment announced yesterday by U.S. Attorney Melinda Haag in San Francisco. Bernanke Tightens Hold on Fed Message Against Hawks (Bloomberg) The Fed chairman, starting tomorrow, will cut the time between the release of post-meeting statements by the Federal Open Market Committee and his news briefings, giving investors less opportunity to misperceive the Fed’s intent. In recent presentations, he has pledged to sustain easing, defending $85 billion in monthly bond purchases during congressional testimony last month and warning that “premature removal of accommodation” may weaken the expansion. Deli Workers Have Some Choice Words for Mayor Bloomberg’s New Cigarette Proposal (Daily Intel) "It's stupid. He needs to f*ck off," Fernando, the manager at M&M Market Deli on Broome Street, said. "You want to smoke, you're going to smoke no matter what. And especially at that young age, you're curious about everything." It was the principle of the thing that so irritated Fernando more than any potential loss of business. "You don't make money on cigarettes," he said. "I mean, our profit on cigarettes is 75 cents, a dollar? The whole purpose of cigarettes is to get people in — you want to buy cigarettes, then you also pick up a sandwich."

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.

Opening Bell: 03.08.13

Stress Tests Show Banks On The Mend (WSJ) The central bank said 17 of the 18 largest U.S. banks have enough capital to keep lending in a hypothetical sharp economic downturn, a sign the financial system is better prepared to weather a shock without resorting to a large, 2008-style infusion of government support. But the "stress test" figures released Thursday also showed that the Fed is paying special attention to the capital strength of companies with large trading operations, a group that includes Goldman Sachs, Morgan Stanley, and JP Morgan. That scrutiny could make it harder for those firms to win regulatory approval to increase dividends and buybacks, and could bruise the companies' recovering reputations with investors. Shares of Goldman and J.P. Morgan have been trading at their highest levels in a year, but both companies dropped more than 1% in after-hours trading following the Fed release. Citi Bests Stress Tests, Discloses Buyback Plan (CNBC) Where stress tests are concerned, call Citigroup "most improved." The bank posted an 8.3 percent tier 1 common capital ratio - the highest of its peers - under the Federal Reserve's annual stress tests. Unemployment Falls To 7.7% (WSJ) U.S. job growth jumped ahead in February, a sign of a steadily improving labor market and stronger economic gains. Employers added 236,000 jobs last month, the Labor Department said Friday. The unemployment rate, obtained by a separate survey of U.S. households, fell two-tenths of a percentage point to 7.7%, the lowest level since the end of 2008. Economists surveyed by Dow Jones Newswires had forecast that nonfarm payrolls would rise by 160,000 and the unemployment rate would fall to 7.8%. Chanos Has Ackman's Back On Herbalife Bet (NYP) Famed short seller Jim Chanos yesterday voiced his support for Ackman’s short position — and revealed he made money from shorting the Los Angeles-based company last year. “I think Bill Ackman is correct in his analysis” of Herbalife, Chanos said in a TV interview. “I’m not crazy for this multi-level-marketing business,” Chanos added...Chanos said on CNBC yesterday morning that he had shorted Herbalife last year, when it was around $50 — but got out when the price fell by half after Ackman went public with his short bet. Firms Send Record Cash Back To Investors (WSJ) Companies in the S&P 500 index are expected to pay at least $300 billion in dividends in 2013, according to S&P Dow Jones Indices, which would top last year's $282 billion. Goldman Symbol Gets More Elusive (WSJ) Upending a closely watched ritual in place since 1996, the New York securities firm told employees Thursday it now plans to promote a new crop of managing directors every two years, instead of each year. The change will start with the group selected later this year. The coveted title, which comes with a base salary of $500,000, elevates the chosen few at Goldman one step closer to the even higher rank of partner. In the memo, Goldman Chairman and Chief Executive Lloyd C. Blankfein and President and Chief Operating Officer Gary D. Cohn said the move would help the firm devote more time to the selection process. "A biennial process will allow us to invest more in the managing director selection process so that it will continue to be a disciplined and rigorous exercise," they wrote. "This will help to ensure that the managing director title remains as aspirational as it should be for our top performers." Hooters Is Chasing Women — as Customers (CNBC) The chain's waitresses are as buxom as ever but its sales have "flattened out," said Darren Tristano, executive vice president at research firm Technomic. Revenue peaked in 2007 at nearly $1 billion but had fallen to around $850 million last year, he estimated. (The privately-held company doesn't release sales figures.) The brand recently announced an overhaul aimed at making Hooters more mainstream than man-cave, adding more salads to its menu, remodeling stores and rolling out a series of ads last week to tout the changes. Icahn Bid Rattles Dell Plan (WSJ) Activist investor Carl Icahn said he would push to replace Dell's board and pursue "years of litigation" if the computer maker refused to accept his demand for a refinancing that would pay a hefty dividend to shareholders. Prodding the company to reject a $24.4 billion buyout offer that it agreed to last month and endorse his alternative, Mr. Icahn disclosed he owns a "substantial" stake in Dell and unleashed his trademark attack on directors and on the management-backed offer. "We see no reason that the future value of Dell should not accrue to all the existing Dell shareholders," Mr. Icahn wrote to a Dell special board committee, insisting it agree to his conditions or hold a vote for a replacement board that would. Ferrari $1.3 Million Hybrid Hits Resurgent Luxury Market (Bloomberg) At the Geneva Motor Show this week, Ferrari showed a 1 million-euro ($1.3 million)hybrid called LaFerrari. Bentley exhibited a revamped four-door Continental Flying Spur. Jaguar debuted the XFR-S, its fastest sedan ever. Rolls-Royce is adding a 245,000-euro coupe called the Wraith to its lineup. Companies Expand Offshore Cash Hoard By $183 Billion (Bloomberg) Microsoft, Apple, And Google each added to their non-U.S. holdings by more than 34 percent as they reaped the benefits of past maneuvers to earn and park profits in low- tax countries. Combined, those three companies alone plan to keep $134.5 billion outside the U.S. government’s reach, more than double the $59.3 billion they held two years earlier. Broker who managed money for NFL players bootled from securities industry after big loss (NYP) A Florida broker who managed money for dozens of prominent National Football League players — includingSantana Moss and Plaxico Burress — has been banned from the securities industry after putting the group into a high-risk investment that lost them a total of $40 million. Jeff Rubin, 38, directed some 31 NFL players into an illegal gambling operation in Alabama — which went bust two years later, a Wall Street regulator said yesterday. One of the players, Samari Toure Rolle, a former cornerback with the Baltimore Ravens, lost $3.2 million, the bulk of his liquid assets, to Rubin, according to the Financial Industry Regulatory Authority, which imposed the ban.

Opening Bell: 09.26.12

Spain Prepares More Austerity, Protesters Battle Police (Reuters) Protesters clashed with police in Spain's capital on Tuesday as the government prepared a new round of unpopular austerity measures for the 2013 budget to be announced on Thursday. Thousands gathered in Neptune plaza, a few metres from El Prado museum in central Madrid, where they formed a human chain around parliament, surrounded by barricades, police trucks and more than 1,500 police in riot gear. Police fired rubber bullets and beat protesters with truncheons, first as protesters were trying to tear down barriers and later to clear the square. The police said at least 22 people had been arrested and at least 32 injured, including four policemen. Facebook's Next Fight: Suits And More Suits (WSJ) About 50 lawsuits have been filed against Facebook, Nasdaq OMX Group Inc. and underwriters of Facebook's May IPO, according to lawyers involved in the cases. In addition, securities lawyers who represent Facebook investors say they expect hundreds of arbitration claims to be launched against brokers and securities firms that pitched the company's shares. Credit Suisse Said to Consider Merging Its Asset-Management Unit (Bloomberg) The bank is considering combining its asset-management unit with the private and investment banking divisions, a person familiar with the matter said. SAC Capital Fund Manager Said To Be Uncharged Conspirator (Bloomberg) The role allegedly played by Michael Steinberg emerged in court papers filed by the U.S. in the securities-fraud case of Jon Horvath, a former technology analyst at Cohen’s $14 billion hedge fund who Steinberg supervised. Steinberg, who hasn’t been charged with a crime, is the fifth person to be tied to insider trading while employed at SAC. Horvath faces trial Oct. 29 in Manhattan federal court along with two other portfolio managers for his part in what Manhattan U.S. Attorney Preet Bharara called a “criminal club:” a conspiracy of hedge fund managers, co-workers and company insiders who reaped millions of dollars on illegal tips about Dell Inc. and Nvidia Corp. “The government added four additional co-conspirators,” prosecutors wrote in a Sept. 6 letter filed with the court, with the names blacked out. One of them, the U.S. said, is “the portfolio manager to whom Jon Horvath reported at his hedge fund.” That person was Steinberg, said the people, who declined to be identified because the matter isn’t public. UK Group To Give Up Libor Oversight (WSJ) The council of the BBA, a private trade association, voted earlier this month to give up management of Libor, according to people familiar with the matter. The move clears the way for what is likely to be the biggest change in Libor's 26-year history, and introduces the possibility that British or international regulators could be in charge of overseeing the rate, which is tied to trillions of dollars of financial contracts. Rent-a-reptile: Florida company adds alligators to kids’ pool parties (NYDN) Bob Barrett gives Florida kids pool parties they’ll never forget — because they get to swim with real live alligators. Jump houses? Pizza parties? Boring, says Barrett. “You jump for a while and that’s it, we’ve had that party before,” he told the Daily News. “Clown party, Chuck E. Cheese party, they’ve all been done.” Barrett,who runs Alligator Attractions in Madeira Beach — where visitors get to hold gators — was already bringing his reptiles around to birthday parties when he was inspired to take the next step. “We would do [an alligator demonstration] at someone’s house and they would have a pool,” he explained. “And I said, you know, ‘Hey, let’s put ‘em in the pool.’” Hedge Fund Skeptics Warn on ‘QE Infinity’ (FT) “A man’s got to know his limitations,” says “Dirty Harry” Callahan, the gun-toting, rule book-ignoring cop immortalized by Clint Eastwood in “Magnum Force.” It is a principle the U.S. Federal Reserve – which earlier this month embarked upon its own, third bout of “unorthodox” enforcement, “QE3” – could learn from, according to Stephen Jen, the former Morgan Stanley foreign-exchange guru turned hedge fund manager. “The Fed officials are some of the smartest economists around,” he wrote in his most recent note to clients. The trouble is, said Mr. Jen, “they know everything except their own limitations.” Irish Bank Offers Properties For 70% Less Than 2007 Value (Bloomberg) RBS's Irish unit offered to sell properties, including 640 apartments and a hotel, for about 70 percent less than their value at the market’s 2007 peak, according to the broker managing the sale. The Gemini portfolio, containing buildings in the Irish cities of Dublin and Cork, has an asking price of 75 million euros ($97 million), according to Domhnaill O’Sullivan, a director at Savills Plc (SVS)’s Dublin office. MIT Miscounts Its New B-School Students (WSJ) After realizing they had a student surplus, school officials emailed the incoming class on Aug. 7, offering "guaranteed admission to the class of 2015 for the first 20 admitted students who request it." The school gave them until Aug. 13 to respond, according to one student's copy of the letter, which was reviewed by The Wall Street Journal. But it didn't get enough takers. So, like an airline offering vouchers to travelers willing to hop off oversold flights, the school put money on the table, offering students who expressed an interest a $15,000 scholarship to be applied to next year's tuition. Students still balked, and on Aug. 21, a day after pre-term refresher courses began, Sloan raised the offer to $20,000 for the first 10 respondents. (Tuition for the 2012-2013 academic year is $58,200, with total expenses—including books, housing and food—estimated at just under $89,000.) NFL replacement referee who blew touchdown call in Green Bay Packers-Seattle Seahawks game is a full-time banker (NYDN) ...fans, particular those in Wisconsin, said the 52-year-old southern California banker with no previous professional or major college refereeing experience should have never left his desk to become a replacement during the NFL’s lockout of unionized refs. Even the Lingerie Football League piled on, revealing that some of the scab refs weren’t qualified to work its games. “Due to several on-field occurrences of incompetent officiating, we chose to part ways with a crew which apparently is now officiating in the NFL,” said Mitch Mortaza, commissioner of the female bra-and-panty league. “We have a lot of respect for our officials, but we felt the officiating was not in line with our expectations.”

Opening Bell: 04.25.13

Apple Readies Its First Bond Offering (WSJ) Apple's announcement Tuesday that it plans to borrow for the first time could be as well received as its smartphone launches. Investors are desperate to take cash off the sidelines, even on high-quality securities that will yield relatively little. Despite its huge cash stockpile, Apple plans to issue debt to help fund dividend payments and stock buybacks in part because much of its cash is overseas. Raising money in the debt market would help Apple avoid the big tax bill that would come from bringing the cash back to the U.S. "We would likely buy the deal," said Matt Brill, a portfolio manager overseeing $40 billion of investment-grade bondholdings at ING Investment Management. Twitter Said To Bolster Security After AP Hack (Bloomberg) Two-step authentication will be introduced to make it harder for outsiders to gain access to an account, said the person, who declined to be identified because the information isn’t public. In addition to a password, the security measure usually requires a code sent as a text message to a user’s mobile phone, or generated on a device or software. Twitter’s defense against hacks involving the theft of passwords came under scrutiny this week after a hacker sent a false post about explosions at the White House, triggering a drop in the Standard & Poor’s 500 Index that wiped out $136 billion in market value. The attack came the same month the U.S. Securities and Exchange Commission said companies can use social-media sites to share market-sensitive news. It also threatened to complicate efforts by Chief Executive Officer Dick Costolo to establish the service as a viable business ahead of a possible initial public offering. Hoax Won't Deter Tweeting (WSJ) The Twitter hoax won't affect the company's disclosure plans or those of companies like Dell and Exxon Mobil, which have indicated they will use social media to communicate corporate news, according to company officials...Banks say they consider sites like Twitter an increasingly important news source and expect them to become essential outlets given the SEC's recent blessing of social media as a way for companies to disclose market-moving information. Virgin America Wants Fliers to 'Get Lucky' at 35,000 Feet (CNBC) The carrier on Monday introduced a cheeky new seat-to-seat ordering system. Without the assistance of an attendant, you can discreetly order a drink, snack or meal delivered to a fellow passenger onboard your flight. Your flirting begins on the airline's touch-screen personal entertainment system, located on the back of headrests. Call up the flight's digital seat map and send a cocktail, snack or meal to a fellow traveler onboard. After selecting items and paying with a credit card, a flight attendant delivers the goodies directly to the passenger's seat. After the delivery, you can follow up and chat with your object of affection with Virgin America's existing seat-to-seat chat platform via its Red in-flight entertainment system. The chat platform allows travelers to send text messages to other fliers. "I'm not a betting man, but I say your chance of deplaning with a plus-one are at least 50 percent," Branson said in the Get Lucky on Virgin America video posted on the airline's Facebook page. PIMCO's Rising Stars Pull In Money For Future After Gross (Bloomberg) Pacific Investment Management Co. is becoming less dependent on Bill Gross, preparing for an eventual future without the world’s best-known bond investor and adding pressure on its rising stars to live up to his legacy. Gross is overseeing a smaller share of Pimco’s mutual-fund assets and pulling in less of its cash. His $289 billion Pimco Total Return Fund got 19 percent of Pimco’s new mutual-fund deposits in the two years ended March 31, down from 42 percent in the prior period and 79 percent before that, Morningstar estimates. The portion of mutual-fund assets run by Gross fell to 63 percent as of March 31 from 84 percent a decade ago. ECB Says Ditching Austerity Would Not Help Euro Zone (Reuters) European Central Bank Vice-President Vitor Constancio said that seeking to stimulate economies by stopping measures aimed at cutting government debt could merely increase countries' borrowing costs rather than triggering growth. Deutsche Bank can't shake L.A. claims over foreclosure blight (Reuters) A judge has denied Deutsche Bank AG's bid to dismiss a lawsuit by the city of Los Angeles accusing it of letting hundreds of foreclosed properties fall into disrepair and illegally evicting low-income tenants, a representative for the city's attorney said on Wednesday. Los Angeles Superior Court Judge Elihu Berle allowed the 2011 civil enforcement action to proceed, according to the city attorney's office. The ruling was made during an April 8 hearing and a written decision was issued late on Tuesday, the city said. Traders Bet On A Sugar Rush (WSJ) Even as prices plumb nearly three-year lows, investors are betting that they will drop even more. Positions that profit when sugar prices fall hit an all-time high of 212,419 contracts—worth about $4.5 billion—on April 9. The number of these "short" contracts held by investors is up 65% from the start of the year. The wager is that Brazil, the world's biggest sugar producer, will report a record crop this year, leading to a huge global surplus. The harvest began in early April, and the weather has been ideal—dry and sunny. If growers' luck holds, prices could keep falling into late summer, when the total size of the crop begins to take shape, analysts say. 'The Rent is Too Damn High' guy is running for mayor, has an anthem to prove it (NYP, AnimalNY) McMillan has thrown his hat into the ring for the 2013 New York City mayoral race with a musicalanthem and accompanying YouTube video. "Jimmy McMillan, the political candidate whose slogan represents the one issue that all New Yorkers can agree on–that the rent is too damn high–is running for mayor," says Animal New York in the introduction to the video. "It's been two long years since I been on the scene, now I'm back in the game looking mean and lean," McMillan sings in the video. "The race may be different but the message is the same, R.I.T.D.H. is going to change the game!" "My mustache and haircut are too damn fly!"