Opening Bell: 02.28.14

Author:
Updated:
Original:

Bitcoin Derivatives Sprout as Regulators Play Catch-Up (Bloomberg)
The closing of a major Bitcoin exchange in Japan not only focused attention on the digital currency’s risks, it also rattled a still-newer market that regulators are just starting to monitor: Bitcoin derivatives. George Samman, a former Wall Street investment adviser who in May helped start a platform for betting on Bitcoin’s price swings, saw trading on his BTC.sx website grow to more than $35 million by Jan. 21. After the shutdown at Mt. Gox, the Tokyo-based exchange for buying Bitcoins, BTC.sx suspended trading -- because it had to find another exchange partner for its customers. “It is semi-Wild West, but that’s only because it’s new,” Samman said before the Mt. Gox shutdown.

Bitcoin owners find safe place for digital currency: on paper (Reuters)
Canadian mortgage broker and bitcoin enthusiast Chung Cheong writes out his secret number by hand and puts it in a safety deposit box. "The only way to ever access that address and those bitcoins is that piece of paper," said Cheong. "I pray that there isn't a big fire and the bank burns down. Because if that happens, I'm out of luck."

Third Point's Loeb Ramps Up Fight with Sotheby's (WSJ)
Mr. Loeb nominated himself and two others to Sotheby's board of directors early Thursday, setting up a potentially distracting fight for shareholder votes. The move came hours before the company said its profit jumped 37% in the fourth quarter amid strong sales of Asian and Impressionist art. The two sides are battling over Mr. Loeb's arguments that Sotheby's needs to improve its performance online and expand its presence in contemporary art. In a scathing letter to the board in October, Mr. Loeb criticized Sotheby's as an "old master painting in desperate need of restoration."

State Street Enters Fray as Corporate-Bond Broker (WSJ)
As Wall Street banks pull back from some corporate bond trades with clients, other large financial institutions are looking to step in. A State Street Corp. unit has begun handling corporate-bond trades between large investment firms as an intermediary, company officials said. That job is often done by a bank-owned broker-dealer. Rival Bank of New York Mellon Corp. is considering offering a similar service, said people familiar with the matter. The move marks the latest effort to profit from a gradual shift in how trades are handled in the $9.6 trillion corporate-bond market. As banks have retreated from acting as middlemen for bond trades, citing tough new regulations on their capital and risk-taking, a host of financial firms, including some small regional dealers, have looked to cash in on the void they leave behind.

Microsoft Chairman Says Company Must Focus Under Nadella (Bloomberg)
“The issue for us is, quite frankly, about focus,” Thompson said in an interview with Bloomberg Television. “One of the reasons we chose Satya Nadella is he has a strong technology background. He understands exactly what needs to happen to move Microsoft forward.”

The Battle to Cheer Up Africa's Last Polar Bear (WSJ)
Wang was sprawled on his back in the sweltering heat, when veterinarian Katja Koeppel approached with apple slices and the daunting task of cheering up Africa's last polar bear. "Wang!" she called. "Here, Wang!" Ms. Koeppel threw the sliced green apples 30 feet down into his rock-and-grass enclosure. Wang ambled toward the apples, ate them and went back to lying listlessly on the grass. Ms. Koeppel looked resigned. It was another dreary day for one skinny, dirt-covered and depressed polar bear. Wang has been on his own since Geebee, his companion at the Johannesburg Zoo for nearly three decades, died of heart failure in January. Wang's keepers fear grief on top of liver trouble and a summer heat wave in the Southern Hemisphere could combine to kill the 29-year-old bear. So they're ramping up his behavior enrichment with a full regimen of toys, treats and psychological intervention aimed at lifting his spirits. On Valentine's Day, keepers wrote "We love you, Wang" on a cardboard box filled with treats and lowered it into his enclosure. As couples watched from above, Wang nosed the package into a dark room, delicately opened the lid and devoured the fruit and heart-shaped beef steak within. "Wang is pining for Geebee," says Ms. Koeppel, the zoo's manager of veterinary services, "and is understandably very stressed." As was true of Geebee, Wang is nearing the limits of polar-bear life expectancy, so the zoo says it's too late for him to adjust to a new partner.

eBay ‘on guard’ after Icahn challenges board to TV duel (NYP)
Carl Icahn amped up his already fevered battle with eBay on Thursday — challenging the online auction retailer to a duel. Not the pistols-at-20-paces kind of duel, but a live TV debate that the activist investor hopes would settle his argument that the current eBay board is not fit to decide what is best for shareholders. Icahn, known for upping the stakes in his board battles, issued the challenge in his third letter to eBay shareholders this week. Icahn is trying to convince eBay’s shareholders to press the company to split off its financial transaction arm, PayPal. As a first step, he is seeking to add two allies to eBay’s board — and has attacked some current directors in an effort to get them off the board. EBay quickly rejected Icahn’s challenge. “We will not be going head-to-head against Icahn” on TV, a person close to eBay told The Post. The refusal prompted Icahn to compare the online retailer to a restrictive government regime. “It doesn’t surprise me they don’t want to have a debate because in a totalitarian state there are no debates,” Icahn told The Post.

Jos. A. Bank rejects Men's Wearhouse bid, says open to talks (Reuters)
The company's move is the latest in a saga that has played out since last October, when Jos. A Bank made an offer to buy out its larger rival. Men's Wearhouse turned the tables with its own offer and then, in January, went hostile by taking its offer to its smaller rival's shareholders.

A Bachelor Party House in Singapore (WSJ)
On the third floor, once a code is punched into a number pad, sliding doors reveal the over-2,600-square-foot bedroom and bathroom suite, plus an office and an entertainment room. On a translucent door leading to the bathroom is a depiction of the shadow of a woman, caught in the act of tossing back long hair, one hand pressed against the glass. The large, mosaic-tiled shower doesn't have a door, but an entry shaped like a long capsule...Mr. Chan bought the property in 2007 for $4.7 million and hired Singapore architect Aamer Taher. Mr. Chan initially planned to build a home to house a multigenerational family, figuring that it could last him "until old age" or have wide appeal if he were ever to sell it. But as construction costs rose, Mr. Chan shortened the outlook and decided what he really wanted was an "all-out party house for myself." After six months of planning, a year and a half of construction and an investment of about $2.1 million, he moved in. Mr. Chan now says the best party he's ever thrown in his bachelor pad was his own wedding last May, attended by about 60 friends and family. "It was when the full architecture of the house all came together," he says. "We had catering staff, chefs, all these people and I felt like the house could take it. It was the entertainment center I wanted." Wife Calista Chan, a 26-year-old part-time business student, says she loves many things about their home, but that, looking ahead, "we probably will need to add more bedrooms and make it more family-friendly." Mr. Chan has already offered up the office space next to their bedroom as a start. "It can always double up as a baby's room," he says.

Male ex-employee of Manhattan PR firm sues over alleged sexual harassment (NYDN)
Joseph Jackson, 41, claims he endured nearly seven months of verbal come-ons and overt touches from two women supervisors at Open Communications, one of whom allegedly sent him a text asking for a “bang sesh.” Even when John Morris, CEO of Open Communications, a Midtown digital strategy firm, witnessed the raunchy behavior, he simply rolled his eyes and shrugged, the lawsuit contends. Jackson claims he was fired Feb. 21 after formally complaining three times to Morris about inappropriate behavior from supervisors Sally O’Dowd and Katie Campisano. He filed his suit Monday, three days after he lost his job. According to Jackson’s suit, Campisano and O’Dowd started crossing boundaries about a month after he was hired in July. O'Dowd, 45, who co-founded the company, allegedly wrapped her arms around him when he attended her company birthday party in August. The leggy brunette hugged him three times even though he didn’t respond to her, the plaintiff says. “You are so handsome. You are so awesome ...You are so talented,’ she allegedly whispered in his ear. Then she kissed him on the back of the neck,” the lawsuit said. The attention left Jackson “distraught,” according to the lawsuit, and he left the party. But the inappropriate contact continued, his suit asserts. Over the next few months, O’Dowd would run her hands over Jackson, touching his abs, massaging his arms and kissing his neck while telling him how “sexy” he was. She also made comments about her sexual escapades, once comparing Jackson to her “hot lover Apollo,” the suit said. Then she started forcing him to touch her, the plaintiff claims. “I've been doing these exercises and crunches. My body is so fit and tight. Poke my abdomen,” she allegedly told him Dec. 18...At the same time, he was getting unwanted sexual attention from 25-year-old Campisano, the suit says. “When are we going to have our bang sesh?” she allegedly wrote him in a November text.

Related

Opening Bell: 03.25.13

Cyprus Gets New Bailout Deal (WSJ) Cyprus secured a bailout from its international creditors early Monday, ending a week of financial panic that threatened to see the small island nation become the first government to leave the euro zone. But lasting damage has likely been inflicted on the Cypriot economy. Officials said they believe the country will now need strict controls on money transfers in and out of the economy in the coming weeks or possibly months, cutting off its citizens and companies from much of the rest of the euro zone's financial system. And the bailout program aims to slash the size of Cypriot banks, perhaps forever ending the country's status as an offshore tax haven and financial-services center. Cyprus could see its economy contract by 10% or more in the years ahead, economists said. Dell Confirms Rival Offers (WSJ) Dell has received two alternative takeover proposals—one from activist investor Carl Icahn and the other from a private equity fund managed by Blackstone Group —that a special board committee said may result in superior proposals to the one offered last month by founder Michael Dell. Falcone Follows Michael Jackson Path Taking Fortress Loan (Bloomberg) Hedge-fund manager Philip Falcone, beset by declining assets, federal securities regulators and the bankruptcy of his largest investment, is borrowing money against personal real estate he bought during better days. Falcone and his wife, Lisa, pledged their $39 million Caribbean villa to Fortress Credit Corp., the lender that provided Michael Jackson with a mortgage on his Neverland Ranch when the late pop idol was close to insolvency, according to a February regulatory filing. Within the past year, the couple also agreed to post both of their Manhattan townhouses as collateral for about $25 million of personal loans, real estate records show. SEC Approves Facebook IPO Compensation Plan (WSJ) The Securities and Exchange Commission approved Nasdaq OMX Group Inc.'s plan to pay customers as much as $62 million for losses stemming from last year's bungled Facebook stock-market debut, according to an order made public on Monday by the regulator. Brooklyn man furious his roommate wanted to move out allegedly murdered her fish (NYP) A Brooklyn man furious that his longtime roommate wanted to move out turned his rage on her pet fish — flushing one down the toilet and letting the other suffocate, law-enforcement sources told The Post. José Santiago murdered his roommate’s scaly pals — Bonnie and Clyde — when he saw her packing her bags in their Flatbush apartment on Wednesday, she said. “They were my babies! I can’t have children, so my pets are like my kids,” Brenda Alvarez said yesterday. “They were beautiful fish and cost about $25 each. “I did everything for him, and the only thing I ever asked him to do was the laundry,” she said. “So, why did he do this to me?” Alvarez, 45, said she wanted to move out of the Nostrand Avenue apartment because of growing tension between the longtime friends, who grew up a block apart in Bay Ridge. “I was gonna leave . . . so, I started packing, but he kept antagonizing me,” Alvarez recalled. “Then he went crazy!” U.S. Hedge Funds Swoop on Traders at Struggling Europe Startups (Bloomberg) U.S. hedge funds Pine River Capital Management LP, Millennium Management LLC and SAC Capital Advisors LLC are taking advantage of the struggle of European startup funds to grab their pick of the region’s traders. The three firms, which manage a combined $46 billion, have over the past year all hired employees from hedge funds started by former European bankers, according to regulatory records and people with knowledge of the matter. They joined from firms including Edoma Partners LLP, Occitan Capital Partners LLP and Portman Square Capital LLP, London hedge funds that have either shut down, posted losses or failed to meet their fundraising goals, said the people, who declined to be identified because the companies are private. Buyout Firm to Acquire Blockbuster's U.K. Unit (WSJ) Private-equity firm Gordon Brothers Europe agreed to buy the British arm of DVD-rental firm Blockbuster Inc., which had entered a form of bankruptcy in January. The deal will help save 264 Blockbuster stores and more than 2,000 jobs in the U.K., Gordon Brothers Europe said in a statement Saturday. Terms of the deal weren't disclosed. Man charged with drinking $102,000 worth of pre-Prohibition whiskey (WTAE) Hidden behind a basement staircase at a Westmoreland County mansion was a secret stash of liquid gold: old farm pure rye whiskey. Distilled in 1912 and delivered to industrialist J.P. Brennan in 1917, nearly 100 bottles of West Overton Distilling Company's pure rye collected dust until their discovery recently. Homeowner Patricia Hill surmised Brennan hid the whiskey during Prohibition. Hill purchased the South Broadway mansion from Brennan's daughter at auction in 1986. Since then, Hill has been remodeling the mansion and filling it with antiques in order to open a bed and breakfast, which she did in December 2012. "The whiskey was buried right back here under these stairs. They were doing renovations down here for the plumbing and electrical and they had to rip out underneath the stairs. Whenever they did, they discovered 9 cases of the old farm, pure rye whiskey," said South Broadway Manor's chef and innkeeper, Rick Bruckner. "The story with this isn't just, 'Hey, we have some really old whiskey.' It's, 'Hey, we have some really old, historical whiskey.'" Bruckner explained Brennan was acquainted with Henry Frick and Andrew Carnegie, among other important Pittsburghers during the early 1900's. He said the men would come over to the mansion and likely drink this whiskey. Hill had rented the basement apartment to John Saunders, 62. Saunders is now charged by Scottdale police with consuming 48 bottles of the historic whiskey. In a criminal complaint, Chief Barry Pritts wrote Saunders denied drinking the whiskey or removing labels from the bottles. Saunders reportedly told police he moved the cases to clean them several times but never opened any of the bottles. "Saunders said that the whiskey probably evaporated and being that old, it was probably no good," Pritts wrote.