Opening Bell: 07.11.14

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Cynk Suspended by SEC After No-Member Network’s Surge (Bloomberg)
Cynk Technology Corp., the supposed operator of a social network that caught the attention of the financial world with its skyrocketing stock price, was suspended from trading by the U.S. Securities and Exchange Commission. The halt is because of “concerns regarding the accuracy and adequacy of information in the marketplace and potentially manipulative transactions in CYNK’s common stock,” the SEC said today on its website. Judith Burns, a spokeswoman for the agency, declined to comment further. Cynk’s social network appears to have no members, no revenue, no assets and only one employee. The stock-price chart has been the talk of all manner of business blogs and Twitter pundits, from Business Insider to the Wall Street Journal and Zero Hedge, which has called Cynk’s moves “pure madness.”

Wells Fargo's Profit Edges Up (WSJ)
Wells Fargo reported net income of $5.73 billion, compared with $5.52 billion a year earlier. Per-share earnings, reflecting the payment of preferred dividends, were $1.01 versus 98 cents a year earlier. Revenue slipped 1.5% to $21.07 billion. Analysts polled by Thomson Reuters expected per-share earnings of $1.01 on revenue of $20.84 billion.

Ex-Merrill Lynch Banker Uses Big Data to Save U.K. Pubs (Bloomberg)
The Oxford-educated Bulkin, 37, spent 15 years cutting deals as a mergers & acquisitions banker for Merrill Lynch and Lazard Ltd. before leaving last year to start his own pub company, Hawthorn Leisure Ltd. He’s acquired hundreds of struggling pubs and plans to turn them around by tracking everything from the price charged for beer to daily sales fluctuations to customers’ drink preferences. “Understanding pricing and the mix of drinks is incredibly important,” Bulkin says in an office overlooking Hyde Park in London’s upscale Mayfair district. “A lot of pubs don’t have that data. If you can make them the core of your business, there’s a fantastic opportunity.”

London Seeks New Spenders as Russians Skip $719 Champagne (Bloomberg)
To gauge London’s place in the global economy, you could examine World Bank statistics, canvass investors and analyze trade volumes. Or you could visit Mahiki, a Polynesian-themed nightclub in upmarket Mayfair where a bottle of Cristal Champagne goes for $719 -- and Russian customers are being supplanted by revelers from countries including China and Nigeria. “We’re seeing a lot less Russian surnames on the booking sheet,” said Michael Evans, the creative director of the club, where the likes of Rihanna and Prince Harry have been spotted after dark. “It’s very easy to see what’s going on in the world from the markets we attract.”

Rajaratnam acquittal shows indirect insider trading case challenge (Reuters)
The acquittal on Tuesday of the younger brother of convicted hedge fund titan Raj Rajaratnam suggests prosecutors will have a tougher time pursuing people accused of trading on inside information they received indirectly. Roughly a third of the insider trader defendants charged by Manhattan U.S. Attorney Preet Bharara since 2009 are alleged so-called "remote tippees". According to prosecutors, in such cases the defendant, or "tippee," never directly talks to the insider, instead getting information from an intermediary. After the case of former Galleon Group fund manager Rengan Rajaratnam, prosecutors may reevaluate how they build similar cases, said James Cox, a law professor at Duke University.

Gym Teacher, Suspended For Twerking With Students (HP)
Courtney Spruill, who teaches history and PE at Kernan Middle School in Jacksonville was suspended for 15 days without pay on July 1. The tush-shaking tips allegedly occurred in May during a party for the girls' soccer team that took place at the house of one of the players. Spruill is the team coach. Witnesses at the party told Duval County School Board investigators they saw Spruill drinking vodka and twerking on the players. Investigators also say they reviewed a cellphone video of Spruill getting a lap dance from a student at the party, WPTV TV reports.

Can Puerto Rico Keep the Lights On? (BusinessWeek)
The Puerto Rico Electric Power Authority, which provides almost all the island’s electricity, may have to choose between paying bondholders and keeping the lights on, Marxuach says. The utility, which carries $8.6 billion in debt, has negotiated with creditors to postpone to July 31 repayment of bank loans due during the month. Prepa, as the agency is known, may have to resort to rolling blackouts in residential areas so hospitals, schools, and businesses can function, Marxuach says. That would “bring home to a lot of people the magnitude of the crisis we’re going through,” he says. In a statement, Juan Alicea Flores, Prepa’s executive director, said: “Prepa will continue to produce and deliver power.”

Despite Exposure of Madoff Fraud, New Ponzi Schemes Emerge (Dealbook)
“Every other day, you see new schemes uncovered that involve big dollar amounts,” said Jordan D. Maglich, a Tampa, Fla., lawyer who follows Ponzi schemes. He started ponzitracker.com in 2009 after working with his law firm to help recover the $350 million that a Sarasota, Fla., hedge fund manager, Arthur G. Nadel, defrauded from investors, and realized there was no central point of information on such frauds. Over the last five years, Mr. Maglich said, he has followed about 500 Ponzi schemes on his site.

ECB Eyes Risks of Use of Computer-Based Forex Trading (WSJ)
ECB officials and commercial currencies bankers met at an ECB-hosted contact group July 7, and discussed whether banks' technology can cope with a jump in demand from investors to execute orders algorithmically rather than over the phone, according to a person familiar with the matter. They also discussed whether this change will cause an increase in banks' technology costs. "Those methods have the beauty of a smoother execution. But there are two issues: is the banks' infrastructure robust enough to cope with the increase in demand? And can the also machine break or misbehave leaving a bug in the software?" the person said. It is the first time in recent meetings that the issue has taken center stage in the discussion.

British banks paying $2 billion for swaps mis-selling: regulator (Reuters)
Britain's banks are in the process of paying out 1.2 billion pounds ($2 billion) to compensate small businesses that were mis-sold complex interest rate hedging products, data from the UK financial watchdog showed on Friday. The figure represents about a third of the 3.75 billion pounds set aside by Britain's four biggest banks - Barclays (BARC.L), HSBC (HSBA.L), Lloyds Banking Group (LLOY.L) and Royal Bank of Scotland (RBS.L) - to deal with the issue.

Cops: Woman Stripped, Did Yoga In Roadway (TSG)
Michele Cernak, 51, was collared on a variety of drug counts after police responded to a 911 call about an intoxicated woman stripping off her clothes on an Ocala street. When officers confronted the Ocala resident, her pants were at her ankles (though she still had “pant!es covering her private area,” cops noted). Witnesses told officers that Cernak had been doing yoga poses. Cernak was exercising about ten feet from her truck, which had its driver’s door open. A search of the vehicle turned up heroin and drug paraphernalia, according to an Ocala Police Department report.

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Opening Bell: 09.13.12

Ray Dalio: US Economy Out Of Intensive Care (Reuters) Hedge fund titan Ray Dalio said the U.S economy had come out of the "intensive care unit," but he warned against any quick move to "austerity" budget measures. "We were in the intensive care unit," Dalio, who runs the $120 billion hedge fund Bridgewater Associates, told more than 200 guests at the Council of Foreign Relations in New York on Wednesday. "We are largely healed and largely operating in a manner that is sustainable if we don't hit an air pocket." Dalio said a major challenge for U.S. politicians will be dealing with the so-called "fiscal cliff," the year-end expiration of the Bush-era tax cuts and previously agreed-upon cuts in defense spending and social programs, a combination which some economists say could lead to a recession. Dalio sided with economists who worry that a sharp reduction in government spending could lead the United States back into recession. "We can't just worry about too much debt," Dalio said. "We have to worry about too much austerity." German Court Clears Rescue Fund (WSJ) Germany's highest court cautiously approved the creation of the euro zone's permanent bailout facility, but insisted that the country keep its effective veto on all of the vehicle's decisions, a ruling that removes a question mark over two crucial elements of the euro zone's plans for mastering its debt crisis. Treasury Backs Plan For Standard Chartered Settlement (NYT) The lawyers approved a potential prepayment amount this week, a crucial step to a final agreement, though it will be much smaller than the $340 million the bank had to pay to New York State’s top banking regulator in a related case, according to three officials with direct knowledge of the settlement talks. The differing penalties stem from determinations by federal authorities and Manhattan prosecutors that the bank’s suspected wrongdoing was much less extensive than the state banking regulator’s claims that Standard Chartered had schemed with Iran to hide from regulators 60,000 transactions worth $250 billion over a decade. Insiders Get Post IPO Pass (WSJ) Wall Street underwriters increasingly are allowing corporate insiders to sidestep agreements that prevent them from quickly selling shares after initial public offerings. In the latest instance, several Wall Street banks on Wednesday allowed early investors and management of ExactTarget Inc. to sell more than seven million shares of the online marketing company a week ahead of the planned end of a "lockup" agreement. Under lockup pacts, underwriters bar company insiders from selling their shares, usually for 180 days after an IPO. The lockup restricts the supply of shares, helping buoy IPO prices; releasing more shares on the market can keep a lid on stock prices. Anna Gristina sits down with TV shrink Dr. Phil, says she won't talk to prosecutors about associate (NYDN) The Soccer Mom Madam's little black book has been whittled down to a single name. In her first major interview since being released from Rikers Island in June, Anna Gristina dishes to TV talk show shrink Dr. Phil about how prosecutors have hounded her for dirt on a just one associate. “They have an agenda to get me to talk about a certain person,” she told the daytime doc. Gristina refused to reveal the mystery man, or woman. Oprah's former head-shrink sidekick, who sat down at the kitchen table in Gristina's Monroe, N.Y. farmhouse, asked why the accused flesh-peddler didn't just save herself and give prosecutors the information they want. “I have a deep sense of loyalty and I'm Scottish." Gristina denied the criminal allegations during the teary interview, maintaining she was developing an online dating site where married men could meet single women. Whistleblower Key To Buyout Probe (WSJ) New York state Attorney General Eric Schneiderman's probe of tax practices at private-equity firms is based on information from a whistleblower, according to a person familiar with the matter. The information came from someone who approached Mr. Schneiderman's office between roughly nine months and a year ago, this person said. Under the state's False Claims Act, the attorney general can investigate alleged fraud against the state basedon a whistleblower's allegations. The ongoing probe is examining whether partners at private-equity firms changed management fees into investment income to delay tax payment and pay less—or avoid taxes altogether. Some private-equity firms use so-called management-fee conversions, while other firms avoid them. Wall Street Hopes for Romney, but Expects Obama to Win (CNBC) In an unscientific poll, 46 percent of respondents to the September CNBC Fed Survey said they expect President Obama to win reelection. Only 24 percent believe Republican Presidential Nominee Mitt Romney will get the job. Longtime Madoff Employee To Plead Guilty (Reuters) Irwin Lipkin, a former controller of Bernard L. Madoff Investment Securities LLC, will appear in Manhattan federal court on Th ursday, prosecutors said in a letter to the judge. He will plead guilty to charges of conspiracy to commit securities fraud and falsifying documents, prosecutors told U.S. District Judge Laura Taylor Swain in the letter. Suspect pulls gun on victim while having sex in a moving car (WNN) The incident began Sep. 2 when the victim and his two friends went to the Paddy Wagon Irish Pub in Port Charlotte. When the bar closed early Monday morning they invited two girls they met to one of the friend’s home on Atlas Street. One of the women and the victim went into a bedroom to have sex. The girl said she needed $250, which he said he didn’t have. She asked how much he had and he gave her $120. The victim then went to the bathroom and when he returned, found the two women had left the home. The victim had obtained the woman’s cell phone number earlier at the bar and called her; they agreed to meet at the Pick N Run store on Peachland Boulevard. When he got there he expected to meet the woman who took the $120. Instead, Linscott walked up to his Nissan Sentra and said the other girl ditched her. Linscott got into his car and as they drove off, he said she began touching him and having sex while he was driving. The victim told detectives she also said she needed money and he told her he already gave her friend $120 earlier. The victim said Linscott then put a .357 Taurus revolver to his head and demanded money. The victim grabbed the gun and a fight ensued in the moving car; he said he punched her in the head so she would release the gun. He told detectives he was in fear of his life and lost control of his car, struck a palm tree, went airborne and then ran across two front yards in the 1200 block of Dewhurst Street.

Opening Bell: 3.3.15

Bill Gross asks for 2-4 years to prove himself; Venezuela tops list of most miserable economies; Lumber Liquidators says everything is cool; StanChart's bonuses are down; "Seattle doctor disciplined for sexting during surgery"; AND MORE.

Opening Bell: 11.25.15

"Hedge funds stalk battered corner of bond world"; Goldman bankers join Uber; Private equity goes after Premier League; Baby Cheesus; and more.

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Opening Bell: 7.27.16

Goldman is sued in U.S. over merger linked to Malaysia's 1MDB; Dan Loeb had a nice little first half; Man leaves clothes in pub as he goes to get cash; and more.

Opening Bell: 12.18.12

Dozens Likely Implicated In UBS Libor Deal (FT) bout three dozen bankers and senior managers will be implicated in the alleged rigging of Libor interest rates when UBS settles with global regulators later this week, according to people familiar with the matter. UBS is close to finalizing a deal with UK, US and Swiss authorities in which the bank will pay close to $1.5 billion and its Japanese securities subsidiary will plead guilty to a US criminal offence. Terms of the guilty plea were still being negotiated, one person familiar with the matter said on Monday, adding that the bank will not lose its ability to conduct business in Japan...Not all of the three dozen individuals will face criminal or civil charges and the level of alleged misconduct varies among them. While it also is not clear how many bankers will be criminally charged, people familiar with the investigation said the settlement documents will document an intercontinental scheme to manipulate the Yen-Libor interest rate over several years involving desks from Tokyo to London. Cerberus Seeks Sale of Gun Maker Freedom Group (WSJ) Private-equity firm Cerberus Capital Management LP said it is seeking to sell the company that manufactures a gun used in last week's shooting at Sandy Hook Elementary School in Newtown, Conn. "We have determined to immediately engage in a formal process to sell our investment in Freedom Group…We believe that this decision allows us to meet our obligations to the investors whose interests we are entrusted to protect without being drawn into the national debate that is more properly pursued by those with the formal charter and public responsibility to do so," Cerberus said in a statement Tuesday. Cliff Talks Narrow (WSJ) President Barack Obama backed away from his long-standing call for raising tax rates on households making more than $250,000 a year, a development that inches the White House and congressional Republicans closer to a budget deal. Mr. Obama's move, a counter to Republicans' recent proposal to raise tax rates on income over $1 million, further narrows the differences between the two sides. During a meeting with House Speaker John Boehner (R., Ohio) Monday the president proposed allowing Bush-era tax rates to expire for households making more than $400,000 in annual income, people familiar with the meeting said. Poland Finds It's Not Immune To Euro Crisis (NYT) During much of the region’s debt crisis so far, Poland has counted itself fortunate that the troubles began before the country had joined the euro currency union. By being part of the E.U.’s common market, but not bound by euro strictures, Poland has been one of the Continent’s rare economic good-news stories. But the deceleration in Polish growth, which has prompted the central bank to begin a series of interest rate cuts to stimulate the economy, has underscored the country’s exposure to slumping euro zone consumer markets. Hedge Fund Managers Convicted of Insider-Trading Scheme (Bloomberg) Level Global Investors LP co-founder Anthony Chiasson and former Diamondback Capital Management LLC portfolio manager Todd Newman were convicted of securities fraud and conspiracy for an insider-trading scheme that reaped more than $72 million. After deliberating a little more than two days, a federal jury in New York found both men guilty of conspiracy to commit securities fraud for a scheme to trade on Dell Inc. (DELL) and Nvidia Corp. (NVDA) using illicit tips. The panel found Chiasson, 39, guilty of five counts of securities fraud, earning Level Global $68.5 million on inside tips trading on the two technology company stocks. Newman, 48, was convicted of four counts of securities fraud related to trades on inside information that earned his fund about $3.8 million. “We had all the evidence we needed,” said Felicia Rivera, a juror from Westchester County near New York City, said after court. Credit unions sue JPM for $3.6B (NYP) The nation’s credit-union watchdog sued JPMorgan for a second time yesterday over $3.6 billion of Bear Stearns mortgage bonds that imploded in the wake of the financial crisis. The suit brought by the National Credit Union Administration accuses Bear Stearns, the failed bank acquired by JPMorgan in 2008, of peddling toxic securities to four credit unions that later collapsed. The same government agency sued JPMorgan last year over $1.4 billion in mortgage-backed securities that led to losses for credit unions. That suit is still pending. In the latest complaint, the credit union regulator said Bear Stearns conspired with at least 16 outfits that cranked out toxic mortgages and securities sold to unsuspecting buyers. Those included notorious subprime mortgage outfits such as Countrywide Financial, New Century and People’s Choice Home Loans. Man wears 70 items of clothing at airport to avoid baggage charge (DS) A man took to putting on 70 items of clothing to avoid an extra baggage charge at an airport. The unidentified passenger turned up at Guangzhou Baiyun International Airport in China, described as looking like a 'sumo wrestler'. According to Guangzhou Daily, the man's luggage exceeded the weight limit. He did not want to pay the extra baggage costs, and thus took out and wore more than 60 shirts and nine pairs of jeans. Wanting to board a flight to Nairobi, Kenya, he was stopped by the metal detector and had to undergo a full body search. AIG Raises $6.45 Billion as AIA Priced in Top Half of Range (Bloomberg) AIG sold 1.65 billion shares at HK$30.30 each, AIA said in a statement today. The shares were offered at HK$29.65 to HK$30.65 each. AIA fell 3.3 percent to close at HK$30.60 in Hong Kong, the most since July 23. It was the biggest decliner and most actively traded stock by both volume and value in the city’s benchmark Hang Seng Index (HSI) with HK$56.6 billion ($7.3 billion) worth of shares changing hands today. Probe Sparks Split On Trades (WSJ) A regulatory investigation into whether stock exchanges have given unfair advantages to high-speed traders has sparked complaints against the exchanges, fueling a broader debate about how the market operates and is regulated. The Investment Company Institute, trade group for mutual funds, complained in a recent letter to the Securities and Exchange Commission that U.S. stock exchanges "facilitate strategies" for rapid-fire trading firms "that can lead to disorderly markets or that can benefit market participants at the expense of long-term investors." Buybacks Rule The Day (WSJ) American companies bought back $274 billion more shares than they issued in the year through September, according to Ed Yardeni, president of investment advisory firm Yardeni Research. And the spending spree looks set to continue, a sign that companies have the cash to put to work but don't yet see an economic case for using it to expand their businesses or create jobs. Dog swallows a foot of Christmas lights (Mirror) Charlie, a seven-year-old crossbreed dog from Southampton, was saved by surgeons from veterinary charity PDSA after wolfing down his family's Christmas lights recently. And the dog has a track record for getting his paws, and teeth, on household objects, having once eaten his owner Sharon Fay's scarf. Ms Fay, who aptly refers to her dog as the "light of her life", became concerned when she noticed bits of wire sticking out of Charlie's faeces in the garden. The 45-year-old said: "I hadn't even noticed that the lights had been chewed at this stage but it quickly became clear what had happened. "Back in March he ate one of my scarves and needed an operation to remove it, but I thought it was just a one-off incident as he hadn't shown any signs that he was going to be a repeat offender. I've had dogs all my life and have never known a dog act like this before." An X-ray immediately cast a light on Charlie's problem - the tangled remains of the decorations clearly showed up in his stomach and would have proved fatal if they were not removed. Vets rushed Charlie to the operating table and removed the Christmas decorations, also finding a shoelace.