Opening Bell: 07.31.14

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BNP Paribas Reports Record $5.79 Billion Quarterly Loss (WSJ)
The French lender said on Thursday that a provision of €5.75 billion ($7.70 billion) set aside to help cover a nearly $9 billion U.S. fine—the largest-ever paid by a bank in a sanctions case—had pushed the group deep into the red in the second-quarter. BNP Paribas, France's largest listed bank by assets, reported a €4.32 billion net loss in the three months through June, compared with a €1.77 billion net profit a year ago. "The group has learned lessons from these past events and is implementing a major reinforcement of its internal control," said Chief Executive Jean-Laurent Bonnafé in a statement. Despite the substantial size of the penalties, which also include a one-year ban on certain dollar-clearing transactions, BNP Paribas said it had enough cash set aside with central banks and capital to absorb any potential future losses.

Argentina’s Default Clock Runs Out as Debt Talks Collapse (Bloomberg)
The nation missed a deadline yesterday to pay $539 million in interest after two full days of negotiations in New York failed to produce an accord with creditors from its last default in 2001. A U.S. judge ruled that the payment couldn’t be made unless those investors, a group of hedge funds led by Elliott Management Corp., got the $1.5 billion they claimed. As Economy Minister Axel Kicillof returns to Buenos Aires with no set plans for further discussions with the hedge funds he described as “vultures,” other creditors must decide whether to invoke a clause that entitles them to demand their money back. While an 11th-hour attempt last night by a group of Argentine banks to avert a crisis by purchasing the securities from Elliott fell through, bondholders probably will give the parties more time to reach a settlement, according to Bank of America Corp.

First round of Buffalo Bills bids tops $1 billion (NYP)
A Pennsylvania fracking mogul bid more than $1 billion for the Buffalo Bills on Tuesday — making it likely the team will attract a record sales price for an NFL team, The Post has learned. Terrence Pegula, who owns the NHL Buffalo Sabres, is one of only two known bidders for the storied football franchise, which was put on the block last spring following the March 25 death of owner Ralph Wilson Jr. Donald Trump also made a first-round bid for the Bills — bids were due by 5 p.m. Tuesday. It could not be learned whether other bids were received by Morgan Stanley, which is running the auction. A bidding group fronted by rocker Jon Bon Jovi that includes Larry Tanenbaum, chairman of Maple Leaf Sports & Entertainment, owner of the NBA Toronto Raptors and the NHL Maple Leafs, and the Canadian telecom titan Rogers family, which controls Rogers Communications, was expected to bid. The Bon Jovi group is expected to try to move the team to Toronto. That has made Bon Jovi Public Enemy No. 1 in the western New York city, which loves its NFL team. “Man, f–k Bon Jovi,” legendary Bills receiver Andre Reed, who will be inducted into the Hall of Fame this weekend, told New York Magazine. “You might as well just take this city, throw it in the river, and let it go down Niagara Falls.”

Barclays Under U.S. Pressure (WSJ)
On Wednesday, the British bank presented better than expected second quarter earnings, with its shares rallying over 4% on the news that its investment bank performed well. But the numbers were partly overshadowed by a number of litigation and conduct issues which rather than fading, seem to be getting worse. Barclays said it had to put aside another £900 million ($1.5 billion) to cover potential claims from customers who were wrongfully sold insurance products. It also disclosed that U.S. authorities extended for one more year an agreement that essentially puts the bank on probation while the government looks into allegations that the bank rigged foreign-exchange markets.

Buyout Shops Look to Rivals for Deals (WSJ)
Private-equity firms have all but stopped buying public companies, retreating from a cornerstone of their business as rising stock prices push acquisition targets out of reach. Public companies taken private accounted for 3.5% of the $89 billion of U.S. leveraged buyouts in the first half of this year, the lowest share on record, according to data tracker S&P Capital IQ LCD. In the first half of 2008, at the apex of a buyout boom, these types of deals represented about 68% of all buyouts by dollar volume. Instead, private-equity firms are buying companies from one another, a shift driven in part by the relative simplicity of completing an acquisition of a private company compared with a publicly traded one. Transactions between private-equity firms have made up 60% of U.S. leveraged buyout volume through June, according to S&P. That is a higher percentage than the ratio for any full year tracked by the firm, whose data date to 2002.

Greenspan Says Stocks to See ‘Significant Correction’ (Bloomberg)
“The stock market has recovered so sharply for so long, you have to assume somewhere along the line we will get a significant correction,” Greenspan, 88, said Wednesday in an interview on Bloomberg Television’s “In the Loop” with Betty Liu. “Where that is, I do not know.”

Flight Attendant Warns Travelers To Flush Their Drugs Before Landing (AP)
An Australian airline apologized on Wednesday for a warning a flight attendant gave passengers who might have been flying high that there were drug-sniffer dogs awaiting them at Sydney airport. Many of the 210 passengers aboard the Jetstar flight from Gold Coast city on Sunday night had attended the Splendour in the Grass weekend music festival at Byron Bay and were returning home. "We have been told there are sniffer dogs and quarantine officers waiting in the domestic terminal," Sydney's The Daily Telegraph newspaper on Wednesday quoted the attendant as telling passengers via the Airbus A320's public address system. "If you need to dispose of anything you shouldn't have, we suggest you flush it now," he added. The newspaper said the warning prompted passengers to rush for the toilets. Jetstar spokesman Stephen Moynihan confirmed the newspaper report was accurate. He said the public response to the announcement had been "mixed." The airline said it routinely makes quarantine announcements on such flights that cross state borders. "The crew member's words were poorly chosen and are plainly at odds with the professional standards we'd expect from our team," Jetstar said in a statement. "We apologize to customers offended by the comments."

Investment Bank Job Cuts Loom as Cost Drop Trails Revenue (Bloomberg)
The largest global investment banks face further cost reductions, like the job cuts JPMorgan Chase & Co. began this month, after a drop in first-half expenses failed to match a decline in revenue. Pretax profit at the banking and trading units at seven of the nine largest firms fell in the first six months as costs for the group decreased less than 1 percent from the same period a year earlier, according to data compiled by Bloomberg. Revenue dropped 5 percent, driven by the worst first-half trading results since the financial crisis.

Bitcoin Raises Its Washington Profile to Silicon Valley’s Dismay (Bloomberg)
The Bitcoin Foundation’s executive director, Jon Matonis, travels the world to promote the virtual currency as a replacement for traditional money. Some of his members want him to focus on a less lofty goal: helping them make lots of old-fashioned cash. Matonis, a longtime advocate of what he calls “non-political money,” has built the group into a kind of a bitcoin governing body. Early this month he hired a Washington lobby firm, and today he unveiled a website aimed at raising the virtual currency’s public profile. Some foundation members are dismayed by Matonis’ leadership and grander plans. Investors from Silicon Valley in particular would like the group to focus on more technical matters, particularly fortifying the underlying bitcoin software so it can grow into a viable, large-scale payment network.

Portugal's Banco Espírito Santo Reports Record Loss (WSJ)
Banco Espírito Santo SA, Portugal's No. 2 lender by assets, reported a record €3.49 billion ($4.68 billion) net loss for the second quarter after its trouble parent found ways to use the bank--and its customers--to raise funds that are now largely unrecoverable. The bank, which brought in new management earlier this month, said that because of the loss, its capital levels have fallen below the minimum required by the country's central bank, making a capital increase needed.

Kanye West: A Brand-New Ye (GQ)
GQ: Why'd you decide to get married? KW: Saying "Hey, I like Kim" isn't as inspiring to people as us getting married. And anyone that's in a relationship knows that in order to get to the point to get married and then to be married and to then carry on, it needs that work put into it. Right now, people look at it and it's like, "Wow, that's inspiring." Meaning that love is infectious. You know, God is infectious—God flowing through us and us being little-baby creators and shit. But His energy and His love and what He wants us to have as people and the way He wants us to love each other, that is infectious. Like they said in Step Brothers: Never lose your dinosaur. This is the ultimate example of a person never losing his dinosaur. Meaning that even as I grew in cultural awareness and respect and was put higher in the class system in some way for being this musician, I never lost my dinosaur...I don't give a f*ck about people's opinions. Because when a kid falls in love with an airplane or a bike or a dinosaur—especially if you're an only child and it's not because of the book that the sibling was reading—it's like, f*ck, you mean to tell me that the dinosaurs walked the earth and stuff like that?! That's amazing! You mean to tell me that these giant multi-ton crafts can fly that fast and that loud, and they can flip, and there's danger, the possibility of them exploding? That's f*cking cool! You mean to tell me that this girl with this f*cking body and this face is also into style, and she's a nice person, and she has her own money and is family-oriented? That's just as cool as a f*cking fighter jet or dinosaur! And just as rarely seen...Kim is the type of girl that, her entire life, if you were in school with her, most people would be studying and up late nights, but for some reason she would have the skill set to go and grab the one book, turn to the exact page, and just magically say, "That's the exact answer."

Related

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: 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: 06.11.12

Nasdaq CEO Lost Touch Amid Facebook Chaos (WSJ) At the end of Facebook's disastrous first day of trading May 18, the phone in Robert Greifeld's New York office rang. It was Mary Schapiro, head of the Securities and Exchange Commission, wanting an explanation from the chief executive of Nasdaq OMX Group for the epidemic of glitches and delays in one of the most anticipated initial public offerings ever. Mr. Greifeld couldn't talk. Having monitored the rocky process from Silicon Valley, where he had gone to join Facebook executives in remotely ringing the market's opening bell, he concluded the worst problems were fixed and caught a noon flight back to the East Coast. So, marooned for almost five hours in business class with a phone he says didn't work, he didn't realize that continuing breakdowns at his exchange had left countless investors not knowing how many Facebook shares they had bought or sold and at what price, nor did he know the SEC chief wanted to reach him. Three weeks later, Mr. Greifeld still isn't sure why technology systems failed during the crucial IPO. Nasdaq's failure to see the problem coming is something its engineers are still dissecting. "You wake up, you turn around, and there's a black or dull spot," Mr. Greifeld said in an interview, sucking on Life Savers candy at a conference table in his office. "You can't get away from it." Spain’s Bailout Gives Rajoy Best Chance To Fix Banks (Bloomberg) Spain’s request for as much as 100 billion euros ($125 billion) of European bailout funds may provide the country with enough money to shore up its banking system after three failed attempts in as many years. “Now that they have this money, it will hopefully finally be possible to recognize all the hidden losses and clean up the system,” Luis Garicano, a professor at the London School of Economics, said in a phone interview. The amount sought is about 2.7 times the funds deemed necessary for Spanish banks by the International Monetary Fund in a report released June 8 and five times the total requested by the Bankia group, the country’s third-biggest lender, to cleanse its balance sheet. Spain's economic misery will get worse this year despite bailout request, prime minister says (NYP) A day after the country conceded it needed outside help following months of denying it would seek assistance, Rajoy said more Spaniards will lose their jobs in a country where one out of every four are already unemployed. "This year is going to be a bad one," Rajoy said Sunday in his first comments about the rescue since it was announced the previous evening by his economy minister. IPOs Dry Up Post Facebook (WSJ) In the aftermath of Facebook's botched trading debut, the IPO market has gone three weeks without an offering, the longest drought in five months. It is the slowest stretch in initial public offerings since a four-week span at the end of 2011 and the beginning of this year, according to data from Ipreo. Greece Threatens Wall Street Jobs In Third Trading Plunge (Bloomberg) For a third consecutive year, revenue from investment banking and trading at U.S. firms may fall at least 30 percent from the first quarter, Richard Ramsden, a Goldman Sachs analyst, said in a note last week. Greece, which gave English the word “cycle,” has been the main reason each year that the second quarter soured after a promising first three months. Nickelback Review Goes Viral (Poynter) Music critic Josh Gross has written hundreds of stories about bands, but none has brought him as much attention as the brief he wrote this week about Nickelback’s upcoming appearance in Idaho, where Gross writes for the Boise Weekly. He summarizes the response: "In the past day, I have been told that I am a genius, a king amongst men and a hack that could be easily outdone by a one-armed cat. I should alternately win the Pulitzer and forcibly insert 45 pickles into my bum. There has been little middle ground. Why? Because I had the audacity to point out that seeing Canadian “rock” band Nickelback at the Idaho Center may not be the best use of one’s $45." Gross wrote of the Nickelback: "You can spend $5 to go see Nickelback this week. Or you could buy 45 hammers from the dollar store, hang them from the ceiling at eye level and spend an evening banging the demons out of your dome...$45 is also enough to see Men In Black III five times, buy a dozen Big Macs, do 10 loads of laundry or so many other experiences as banal and meaningless as seeing Nickelback but come without actually having to hear Nickelback. But if you must, the band is playing The Idaho Center on Wednesday, June 13, at 6PM tickets start at $45." Dimon Faces Washington Grilling Over Trading Debacle (Reuters) The Senate Banking Committee has asked Dimon to come prepared Wednesday to provide "a thorough accounting of the trading losses," a committee aide said. Senators will also ask what he knew about the risks involved in the trading strategy. Fed Colleague Backs Dimon (WSJ) "I do not think he should step down," Lee Bollinger said in an interview with The Wall Street Journal. He said Mr. Dimon appears to have done nothing wrong, that critics attacking the Fed have a "false understanding" of how it works, and that it is "foolish" to say Mr. Dimon's presence on the New York Fed board creates an appearance of a conflict when the law requires bankers to serve on such boards. Private lunch with investor Warren Buffett sells for $3.5 million (WaPo) The previous four winning bids have all exceeded $2 million with records set every year. Last year’s winner, hedge fund manager Ted Weschler, paid $2,626,411. India Could Be First BRIC to Lose Investment Grade: S&P (Reuters) Standard & Poor's said on Monday that India could become the first of the so-called BRIC economies to lose its investment grade status, sending the rupee and stocks lower, less than two months after cutting its rating outlook for the country. "Slowing GDP growth and political roadblocks to economic policymaking are just some of the factors pushing up the risk that India could lose its investment-grade rating," the ratings agency said in a statement issued Monday on a report dated June 8. Town Considers Fines For Cursing (WSJ) Mimi Duphily was hanging baskets of pink geraniums on antique street lamps downtown for the Middleborough Beautification and Activities Group when she noticed something else that needed cleaning up—citizens' mouths. "The cursing has gotten very, very bad. I find it appalling and I won't tolerate it," said Ms. Duphily, a civic leader in the otherwise quiet New England community, which calls itself the Cranberry Capital of the World. "No person should be allowed to talk in that manner." Soon, Middleborough residents who do could risk a $20 fine. Ms. Duphily, 63 years old, tried scolding the cursers—whom she describes as young people shouting the "F word" back and forth—with a stern, "Hey kids, that's enough!" Then she conferred with the Beautification and Activities Group, which informed the Middleborough Business Coalition, which then called a summit with Middleborough Police Chief Bruce Gates, who now, in his sworn role, is trying to stomp out swears.

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.