Opening Bell: 12.16.14


Cohen Seeks Law Experts For Fund (Dealbook)
The billionaire investor, who managed to fend off a criminal insider trading investigation of himself, if not of his former hedge fund, is looking for a former prosecutor and several agents from the Federal Bureau of Investigation to join his new $10 billion investment firm, Point72 Asset Management, said several people briefed on the matter, who spoke on the condition of anonymity...So far, none of the F.B.I. agents or former prosecutors approached about taking a job at Point72 have expressed any serious interest despite the promise of hefty salaries, the people briefed on the matter said. One person briefed on the matter said F.B.I. agents have “rebuffed” the overtures.

Asia Hedge Funds Survive in Year of Pain for Global Industry (Bloomberg)
In a punishing year for global hedge funds, those investing in Asia are the survivors. Stung by poor returns and large redemptions, 889 hedge funds worldwide shut in the first 11 months of the year, above the annual average of 810 in the five years since the global financial crisis of 2008, according to figures from research firm Eurekahedge Pte. In contrast, 56 Asia-focused funds had closed by the end of November, less than half the average 135 closures in the previous five years.

Foreign Investors Pile Into Bonds (WSJ)
Foreign investors are snapping up Treasury bonds at the fastest clip in two years, propelling yields to fresh lows even as the U.S. economy gains steam. Purchases by China, Japan, Switzerland and others underscore the broad demand for safe government debt amid global turmoil and uneven economic growth, according to new data from the Federal Reserve and Crédit Agricole.

New Hampshire Businessman Files to Set Up Rare New Bank (WSJ)
Bill Greiner is fed up with banks. But instead of quietly seething or complaining to customer service, the 48-year-old is taking a more radical approach: He is trying to launch his own lender. Mr. Greiner’s proposal, filed with regulators in October, is the first deposit-insurance application for a new bank that the Federal Deposit Insurance Corp. has received all year. If Primary Bank, Mr. Greiner’s proposed firm, wins approval, it would be only the second new bank the FDIC has cleared in the U.S. since 2010. The FDIC declined to comment on Primary Bank. “We’re going against the grain, and we’re OK with that because we see a need,” said Mr. Greiner, a Bedford, N.H., real-estate developer and restaurant owner. Mr. Greiner is taking a gamble: Ever since the financial crisis, banks have been struggling with renewed regulatory scrutiny, competition for a limited pool of loans and low interest rates, which squeeze margins and put pressure on profits.

Carlyle's Holiday Video, With ‘Rap Star’ David Rubenstein (Dealbook)
Mr. Rubenstein, whose firm generated a handsome profit this year on its investment in Beats Electronics, the headphone maker co-founded by Dr. Dre, lays down some finance-themed rhymes in a corporate holiday video released on Monday night. “You know, Dr. Dre is an incredible businessman and artist, and he even inspired me to write my own rap,” Mr. Rubenstein, in a recording studio, says in the Carlyle video. “Let’s hear it,” Daniel A. D’Aniello, Carlyle’s chairman, gamely replies. What follows is not exactly “Straight Outta Compton” or “The Chronic.” Wearing a pair of Beats headphones, Mr. Rubenstein launches into his composition: "It takes a lot of brains to do what we do, Looking for a way to make some dough for you. Energy, commodity, we do it all, So pick up the phone and give us a call. Corporate mezzanine, private equity, Carlyle Group is the place to be. We’re global, we’re mobile, we’re aiming to please. Only goal in mind: serve the LPs."

Obie the fat fighting daschund shows off his incredible 4st weight loss in 'inspirational' dog diet calendar (Telegraph)
An obese daschund who lost almost 4st and had a tummy tuck has released an inspirational calendar for animal weight loss. Two years ago Obie tipped the scales at 5st 7lbs and needed to wear a special harness to prevent injury to his bulging belly. However, after being adopted by former veterinary technician Nora Vanatta in August 2012, he was put on a strict diet and exercise regimen. After two years of hard work and surgery to remove excess skin, the svelte seven-year-old now weighs a healthy 1st 9lbs. Now the previously dumpy daschund's new owner has released an inspirational calendar for 2015 to help motivate other podgy pets shed their pounds. Ms Vanatta, from Portland, Oregon, said: "I feel blessed to be involved in Obie's rehab and hope he can be an inspiration to any person or animal trying to lose weight.

Vice eyes 2015 ‘deal spree’ and IPO plans (FT)
Vice Media will go on a “deal spree” in 2015 and explore an initial public offering if market conditions remain favourable, according to Shane Smith, chief executive of the youth-focused digital media group.
The company has strengthened its senior management team with the appointment of James Schwab, a mergers and acquisitions lawyer, as co-president, who will help oversee a $500m “war chest” for content, technology and distribution deals. “Vice will go on a deal spree in 2015,” Mr Smith told the FT in an interview. “Our war chest is the size of the full valuation of our competition so we will see some major . . . deals happen.” The $500m fund came from A&E Networks, which invested $250m in Vice recently for a 10 per cent stake, valuing the company at $2.5bn. Technology Crossover Ventures, the Silicon Valley fund that has stakes in Facebook and Netflix, also invested $250m in the group. Vice, which in 2013 also took a strategic stake from 21st Century Fox, wanted to stay independent, said Mr Smith. “We would be stupid not to think about an IPO.”

Treasury Department preps its workers for surviving disasters (NYP)
The Office of the Comptroller of the Currency (OCC) — part of the Treasury Department — put out a request for bids for survival kits for all 3,814 of its employees. Many of the bank examiners working for the OCC conduct on-site reviews of banks throughout the country. So that would mean survival kits would be delivered to every major bank in the US, including Goldman Sachs, Bank of America, Citigroup, JPMorgan and Wells Fargo. The survival kits must come in a fanny-pack or backpack that can fit all of the items, including a 33-piece personal first-aid kit with “decongestant tablets” and a variety of bandages and medicines, according to a report in the Washington Free Beacon. The kits must also include a “reusable solar blanket” 52 inches wide by 84 inches long, a 2,400-calorie food bar, “50 water purification tablets,” a “dust mask,” “one-size-fits-all poncho with hood,” a rechargeable lantern with built-in radio and an “Air-Aid emergency mask” for protection against airborne viruses.

Russia Moves to Help Lift Sinking Ruble (WSJ)
A spiraling currency crisis, fueled by the bite of Western sanctions and the plummeting price of oil, spurred Russia’s central bank to raise interest rates late Monday, a drastic move aimed at shoring up the collapsing ruble.

Shale Veteran Takes on Argentina’s $6 Billion Shortfall (Bloomberg)
Argentina is depending on two things to reverse a three-year energy shortfall that’s costing $6 billion a year: a shale formation bigger than Massachusetts and Miguel Galuccio, who has worked on drilling operations from North Dakota to Poland and India. President Cristina Fernandez de Kirchner appointed Galuccio chief executive officer of YPF SA (YPF) in 2012 after she seized control from Spain’s Repsol SA. Since then, Galuccio has tripled investment in the state-run oil company in an effort to reverse a decline in output that’s led to crippling energy shortages and drove Argentina’s energy imports to record highs. As oil prices plunge below $60 a barrel and global producers revise their spending, Galuccio is sticking with a strategy for the Vaca Muerta shale formation that relies on foreign partners with a long-term view. His $16 billion Loma Campana venture with Chevron Corp. is Argentina’s second-largest producer and YPF announced this month a $550 million partnership with Malaysia’s Petrolian Nasional Bhd.

Dealbreaker Dramatic Reading Night Returns For Its Fourth Installment Tomorrow (DB)
Be there.

Colorado Springs brewery caught in social media tiff (Gazette)
Something of a (sober) beer brawl broke out on social media Wednesday after Focus on the Beer published the results of its 2014 Best of Beer contest. Awhile back, the Colorado Springs blog invited readers to vote on their favorite brews in a host of different categories, from best style to best new brewery, in a “completely non-scientific, purely vote-driven” poll. After the big reveal in the best barrel-aged category, Trinity Brewing Co., seemingly miffed about its third-place finish behind Paradox Beer Co. and Nano 108 Brewing Co. (first and second, respectively), Tweeted its reaction: “lol?” Subsequent tweets from the brewery called the contest results a joke, took swings at the city’s intellect (was that aimed at everyone, or just the beer drinkers?) and referenced a possible move to Denver.


puerto rico flag

Opening Bell: 6.30.16

Google Capital makes first public company investment; Airbnb plans stock sales; Puerto Rico says it will default; Roomba beer pong; and more.

Opening Bell: 09.07.12

Bondholders Put On Speed Dial (WSJ) At Wall Street giants Morgan Stanley and Goldman Sachs, the quarterly earnings calls for stock analysts tend to get most of the attention. But another kind of call, this one for bondholders, is moving to the fore. The New York securities firms this summer for the first time held conference calls targeting fixed-income investors. Morgan Stanley and Goldman are seeking out new buyers for their debt in an effort to lower interest rates that are now higher than what industrial companies pay. Investors Expect Libor To Be Replaced Within Five Years (Bloomberg) Forty-four percent of those responding to a quarterly Bloomberg Global Poll said the London interbank offered rate, known as Libor, will be supplanted by a more regulated model within five years. Thirty-four percent predicted the rate will continue to be set by banks in the current fashion, while 22 percent said they didn’t know. Greek Decline Sharper Than Expected (WSJ) So that's not good. Jobless Greeks Resolved to Work Clean Toilets in Sweden (Bloomberg) As a pharmaceutical salesman in Greece for 17 years, Tilemachos Karachalios wore a suit, drove a company car and had an expense account. He now mops schools in Sweden, forced from his home by Greece’s economic crisis. “It was a very good job,” said Karachalios, 40, of his former life. “Now I clean Swedish s---.” Karachalios, who left behind his six-year-old daughter to be raised by his parents, is one of thousands fleeing Greece’s record 24 percent unemployment and austerity measures that threaten to undermine growth. The number of Greeks seeking permission to settle in Sweden, where there are more jobs and a stable economy, almost doubled to 1,093 last year from 2010, and is on pace to increase again this year. “I’m trying to survive,” Karachalios said in an interview in Stockholm. “It’s difficult here, very difficult. I would prefer to stay in Greece. But we don’t have jobs.” Private Equity Tests Pension Funds Patience (WSJ) A new report by a consultant to the California State Teachers' Retirement System, or Calstrs, shows that returns from large U.S. buyout funds are lagging behind many of the pension's internal benchmarks. Vladimir Putin Muses On The Benefits Of Group Sex (Telegraph) President Vladimir Putin of Russia has mused that group sex is better than one-on-one intercourse because participants can take a break. Mr. Putin made the observation on Thursday in his first interview since his inauguration in May, with the Kremlin-controlled, English-language RT television channel. “Some fans of group sex say that it’s better than one-on-one because, as with any collective work, you can skive off,” he said. The comment came after the Russian leader had spoken about an orgy that was staged in Moscow’s state biology museum in 2008 which involved Nadezhda Tolokonnikova, 22, one of three feminist activists of the P*ssy Riot group who were jailed for two years for hooliganism last month after a politically charged trial. Falcone Facing Double Trouble (Bloomberg) A group of LightSquared Inc.’s lenders said they oppose extending Philip Falcone’s control of the wireless broadband venture because his strategy to revive the bankrupt company is too risky. LightSquared, which filed for bankruptcy in May, has asked US Bankruptcy Judge Shelley Chapman for a 150-day extension of its exclusive right to control the bankruptcy case. The lenders, who say they own about $1.1 billion of the $1.7 billion in secured debt of the company’s LP unit, objected in a filing yesterday. “Having nothing to lose, Mr. Falcone wants to pursue a high-risk, high-return strategy” of trying to get regulators to reverse their stance on LightSquared’s technology, the lenders said. Nasdaq-100 to Facebook’s rescue (NYP) Facebook founder Mark Zuckerberg, who has seen his company’s shares get beaten down to less than half their IPO value, may soon get some relief. And ironically, that help will be coming from Nasdaq, the exchange that botched Facebook’s initial public offering back in May. Nasdaq is expected to add Facebook shares to the Nasdaq-100 index, which includes its biggest non-financial companies. The move, which could happen as early as late December after Nasdaq in October re-calibrates the index, should add some stability to Facebook shares. “It’s fair to say that there will be an additional level of liquidity in [Facebook] because of its inclusion in the [Nasdaq-100],” said Adam Sussman, partner at The Tabb Group. UBS, Goldman Join Chorus Of Gloom On China (WSJ) One after the other, many of the largest global banks are cutting their growth forecasts for the world’s second-biggest economy. The downgrades are likely to intensify investors’ concerns about fallout in the rest of Asia, whose exports have taken a kicking from the euro-zone debt crisis and anemic U.S. recovery, while domestic growth also slows. Munich May Not Have Enough Beer for Oktoberfest (CNBC) Beer brewers in Munich may not be able to supply enough beer for the annual Oktoberfest beer festival, local newspaper Munich TZ reported, but the problem is not a lack of the alcoholic beverage. nstead, Heiner Müller, manager at the Paulaner and Hacker-Pschorr brewery told TZ, brewers do not have enough bottles to supply the festival. He called on drinkers to return their empties. "Dear Munichers — bring back your crates. We need our empties,” Müller said...Every summer brewers deal with a shortage of bottles, but it never has been as bad as this year, a spokesman for Hofbräu brewery, which is also suffering from a shortage of bottles, said. He claimed the brewer was short of “tens of thousands” of bottles.