Fed May Not Be Able to Tame Volatile Trading (CNBC)
After weeks of speculation about whether the Fed will or will not clarify its position on quantitative easing, traders are handicapping the outcome of the Fed's two-day meeting and are looking for more guidance on when the Fed could begin what is mostly expected to be a slow paring back of its monthly purchases of Treasurys and mortgage securities. The meeting ends Wednesday with a 2 p.m. ET statement and revised economic forecast, and is then followed at 2:30 p.m. with a briefing from the Fed chairman. "We went from QE forever to QE finite. It's the timing that is uncertain," said RBS senior Treasury strategist John Briggs.
Inflation at 53-Year Low Gives Bernanke Time to Press on With QE (Bloomberg)
The lowest inflation since the brink of the Kennedy-era economic boom in the 1960s is buying time for Federal Reserve Chairman Ben S. Bernanke to press on with the central bank’s $85 billion in monthly bond purchases. A gauge of consumer prices excluding food and energy that is watched by the Fed rose 1.1 percent in the year through April, matching the smallest gain since records started in 1960. With inflation below the Fed’s 2 percent long-run goal and the jobless rate at 7.6 percent, the Fed is falling short of its mandate to ensure stable prices and maximum employment.
Jail reckless bankers, standards commission urges (BBC)
Senior bankers guilty of reckless misconduct should be jailed, a long-awaited report on banking commissioned by the government has recommended. The Parliamentary Commission on Banking Standards was set up by Chancellor George Osborne last year after a number of scandals involving the industry. ... "Too many bankers, especially at the most senior levels, have operated in an environment with insufficient personal responsibility," the report says. "Senior executives were aware that they would not be punished for what they could not see and promptly donned the blindfolds. "Where they could not claim ignorance, they fell back on the claim that everyone was party to a decision, so that no individual could be held squarely to blame - the Murder on the Orient Express defence."
Dish Says It Won’t Submit a New Offer for Sprint Ahead of Deadline (DealBook)
Dish Network said on Tuesday that it would not submit a new takeover bid for Sprint Nextel ahead of a deadline imposed by the company and would instead focus on its bid for a stake in Clearwire, a smaller wireless operator. That appeared to leave Sprint free to complete the sale of a majority stake to SoftBank of Japan for $21.6 billion.
Woman kicks police dog in mouth, breaking his teeth, during subway brawl (NYDN)
A police dog named “Bear” helped arrest a subway brawler in midtown on Tuesday — even though one of the women involved in the fight kicked him in the mouth. ... [T]he dog is a five-year NYPD veteran who’s always ready to lend a helping paw. In 2011, Bear stood guard while Tieniber arrested three men wanted for robbery — one armed with a pair of scissors, Browne said. The same year, the pooch “froze” a razor-wielding suspect with a ferocious bark, allowing Tieniber to arrest the man. The handsome black- and brown-colored pooch was treated and released from the Animal Medical Center on E. 62nd St. in Manhattan and is expected to return to full duty Wednesday. Bear will likely have his two canine teeth capped and two others shaved where they were chipped.
China cash crunch deepens as PBOC withholds funding (FT)
Short-term interbank rates jumped more than 200 basis points, setting a record high at nearly 8 per cent for loans of one month or less, the latest indication of how credit has suddenly become very tight in China. The main reason for the tightness has been the central bank’s reluctance to pump liquidity in to the money market, wrongfooting banks that had expected Beijing would support them with large cash injections, as it had regularly done before. Signalling that the cash crunch could persist for a while, the China Securities Journal, a major state-run newspaper, ran a front-page commentary saying China was at a turning point in monetary policy. “We cannot use as fast money supply growth as in the past, or even faster, to promote economic growth,” the newspaper said. “This means that authorities must control the pace of money supply growth.”
Traders Try to Game Platts Oil-Price Benchmarks (WSJ)
Key to the strategy is a peculiar aspect of the spot market for oil, where traders buy and sell bargeloads for immediate delivery. Deals are negotiated in private, and buyers and sellers aren't required to disclose prices to anyone. To come up with a benchmark price, Platts has to rely on information volunteered by traders—a far cry from the way stocks or even oil futures are priced by crunching comprehensive data from public exchanges.
Google Considering Private-Equity Alliances Amid Buying Spree (Bloomberg)
Google Inc., actively on the lookout for acquisitions, is for the first time considering forging alliances with private-equity firms to help it structure deals. Buyout firms can assist an acquirer by providing needed financing or advice on how a target could be restructured or carved up after a deal closes. While Google may invest cash to get a return on the investment, it may also take part in a deal to acquire an asset, said Don Harrison, Google’s mergers and acquisitions chief.
Jefferson County Debt Plan Is Costly (WSJ)
The proposal for the refinancing, which has been approved by a majority of county commissioners, includes a set of bonds that schedule larger debt payments in the later years of the financing. About $474 million are a type of debt called capital-appreciation bonds. Such bonds have been derided by California's treasurer as "terrible" for their backloaded payments, and Michigan has banned their sale by municipalities.
Wall Street REIT Success Gives Investors Hangover Part II (Bloomberg)
Mortgage real-estate investment trusts raised $7.4 billion in the first quarter by selling new shares, the most in two years, just before a plunge in the value of the firms. American Capital Agency Corp. has declined 17 percent since offering $2 billion in February and Armour Residential REIT Inc. has slumped 24 percent after raising $444 million that month. “It was the absolute wrong time to raise money,” said Julian Mann, who helps oversee $6 billion in bonds as a vice president at Los Angeles-based First Pacific Advisors LLC. “Rather than turn money away, these asset gatherers chose to double-down.” Mortgage REITs, after luring investors with returns of 46 percent over the previous three years and dividends exceeding 10 percent, are declining this quarter by the most since 2008 as Federal Reserve officials signal they’re weighing plans to reduce their purchases of bonds.
Speedy Traders in Talks on Tie-Up (WSJ)
Two of the largest independent U.S. high-frequency-trading firms are in early merger discussions, as a downturn in trading opportunities has spurred cutbacks and tie-up talks among rivals. RGM Advisors LLC and Allston Trading LLC have discussed a deal that would combine their respective strengths in automated stock trading and futures markets, according to people close to the talks.
Ron Paul: Gold Could Go to 'Infinity' (CNBC)
A gold price of "infinity" might be hard to conceptualize, but Paul's point is actually quite simple. He believes that "as long as we have excessive spending, and excessive computerized money, we are going to see gold go up," because the value of the dollar will be driven down. As each dollar becomes less valuable, it takes more of them to purchase an ounce of gold, meaning that the gold price measured in dollars rises. Paul then takes it one step further. If Washington spending and Federal Reserve easing he refers to ends up toppling the U.S. economy and makes the dollar worthless, then no amount of dollars will allow an individual to purchase an ounce of gold. In that nightmare scenario, the price of gold (or anything else) in dollar terms is technically "infinity."
‘Ball buster’ wife is teste: WABC weatherman Bill Evans claims low blow in car fight (NYP)
Bill Evans claims that his wife, 48, “grabbed the waist band of his underwear and reached for his scrotum with her free hand, subsequently scratching it, which resulted in bleeding,” according to the affidavit by Greenwich police. The confrontation started when she “began to insult him in front of their children and told him that he does not live there nor is he wanted there,” according to the affidavit. His daughter asked him to move the car, and he told her he would after he changed, the affidavit said. But Dana entered the room and dumped out his work bag to get the keys. He asked for them back, which is when she punched and slapped him, he claimed, before she threw the keys in the closet. They fought over the keys in the closet, he said — during which time she tried to “karate kick” him. That’s when she clawed his testicles, he claimed.