Opening Bell: 1.6.15

Publish date:

Profit at Point72, Cohen’s New Firm, Outshines Many a Hedge Fund’s (Dealbook)
If Steven A. Cohen’s investment firm were operating as a hedge fund, it would have been one of the industry’s most profitable in 2014. Mr. Cohen’s family office, Point72 Asset Management, generated a gross profit of $2.5 billion to $3 billion, said several people briefed on the firm’s performance who spoke on the condition of anonymity.

Bill Gross Says the Good Times Are Over (Bloomberg)
Bill Gross, the former manager of the world’s largest bond fund, said prices for many assets will fall this year as record-low interest rates fail to restore sufficient economic growth. With global expansion still sputtering after years of interest rates near zero, investors will gradually seek alternatives to risky assets, Gross wrote today in an investment outlook for Janus Capital Group Inc. (JNS), where he runs the $1.2 billion Janus Global Unconstrained Bond Fund. “When the year is done, there will be minus signs in front of returns for many asset classes,” Gross, 70, wrote in the outlook. “The good times are over.”

Debt Dispute Between Hedge Funds and Argentina at Impasse (Dealbook)
Axel Kicillof, the economy minister, said Argentina’s overtures to the holdouts would be on the same terms that it had offered other bondholders, with some sweeteners. But Argentina is still asking the holdouts to accept a haircut of 65 percent on the bond principal, Mr. Kicillof told a local news website over the weekend. He said it would be “as if the exchange were taking place in 2005.” He did claim, however, that Argentina would offer some extra money, such as all the accrued interest on the discounted bonds since 2005. The holdouts, led by Paul Singer’s hedge fund, Elliott Management, and other bondholders that did not file suit, are owed a total of $23 billion, Mr. Kicillof estimated. Under the most recent preliminary offer, he said, they would receive $6.5 billion.

France reclaims 'entrepreneur' roots with leading number of start-ups in Europe (CNBC)
"We are a tech republic," says Nicolas Vassitch, head of the IT department at Ubifrance. It's just that no one knows it, he says. "We have excellent engineers, but most go abroad. You don't even notice them," Mr. Vassitch says. The government is trying to change that. As Economy Minister Emmanuel Macron put it at a recent party to celebrate the French presence at the CES: "We need to find again our spirit of conquest. The word entrepreneur, don't ever forget, is a French word. It's been stolen from us." The start-ups at Ubifrance are working to steal it back. At the practice pitch event one woman stands up and shows off the Bel-T, a belt that is more than a tool to keep pants in place, she says. "It adapts to you," says Carine Coulm, the general manager of Emiota, whether that means you've had a big lunch or simply like your belt looser in the afternoons.

New Jersey man arrested for stealing $1K worth of breast pumps: police (NYDN)
A New Jersey man has been busted for allegedly stealing $1,000 worth of breast pumps from a Burlington Coat Factory, police said. Joseph Galucci, 34, was charged with shoplifting Wednesday after surveillance video capturing the outrageous Dec. 1 theft was posted on social media, Brick Township Police stated in a release. The 34-year-old was identified by police with the public's help after this surveillance video, showing Galucci entering the store, was posted online. The 34-year-old was identified by police with the public's help after this surveillance video, showing Galucci entering the store, was posted online. Tips consequently poured in, leading to his identity and eventual arrest. Galucci is being held at the Ocean County jail on $20,000 bail.

Apollo Plots Salvaging of Bad Caesars Bet (WSJ)
Through a series of financial maneuvers, Apollo has positioned itself to salvage some of the $1.7 billion it invested in Caesars, which it took private seven years ago in a $28 billion leveraged buyout with fellow private-equity firm TPG. The restructuring hinges on the bankruptcy of Caesars’s largest unit, which could come as soon as mid-January, and transfers of the unit’s best assets that have infuriated creditors.

White House Expected to Nominate Community Banker to Federal Reserve (WSJ)
President Barack Obama is expected to nominate a community banker to the Federal Reserve’s Board of Governors as soon as this week, according to several people familiar with the administration’s plans. A White House official didn't comment on the report and said Monday the administration had no personnel announcements. Mr. Obama’s plans were first reported by Politico. Members of the Senate Banking Committee had urged the White House to tap a community banker to increase the diversity of experience on the seven-member board, which sets short-term interest rates and regulates banks.

CNBC to Stop Using Nielsen for Ratings (WSJ)
For years CNBC and its parent company, Comcast Corp. ’s NBCUniversal, have complained that Nielsen underreports the size and wealth of its audience by failing to track “out of home” viewing in places such as offices and airports. CNBC’s switch to Cogent is the latest barb for Nielsen, which has faced criticism from media companies that it has been slow to adapt its traditional ratings to changing media consumption habits. While many media companies say they are frustrated with Nielsen, CNBC is the first network to opt out of its ratings.

Bitcoin exchange Bitstamp suspends service after security breach (Reuters)
Bitstamp, one of the largest exchanges for trading the digital bitcoin currency, said it has suspended its service after a security breach on Sunday, resulting in loss of around 19,000 bit coins. The breach represented a small fraction of its total bitcoin reserve and the majority was held in secure offline systems, the Slovenia-based firm posted on its website on Tuesday. Reuters was unable to contact Bitstamp officials in Slovenia or the United Kingdom, but one of the company's founders, Damijan Merlak, told Slovenian state-owned news agency STA that Bitstamp has enough liquid assets to meet its short-term obligations. "At present we are setting up a duplicate of the whole infrastructure with experts in San Francisco which should be finished within 24 hours. Then we will be able to resume our services," Merlak told STA.

Woman sues over picture on 'rehab' novelty flask (UPI)
A New Mexico woman's lawsuit against a novelty product maker alleges she was defamed when her high school picture was used on a flask with a joke about "rehab." Veronica Vigil's lawsuit, which was filed in state District Court late last year and has now been moved to federal court, alleges the Chimayo woman's 1970 high school graduation picture was used without her permission by Anne Taintor Inc. to decorate a flask with the caption, "I'm going to be the most popular girl in rehab." The lawsuit, which also names Santa Fe gift shop Doodlet's as a defendant, alleges the product defames Vigil by linking her image to substance abuse. "Plaintiff is an active member of her church and does not consume alcohol or drugs," the lawsuit states. "Given the seriousness of the issues of substance abuse in the community in which plaintiff resides, she has held herself out by reputation for her children and her community, to refrain from abuse or even use of alcohol and illicit drugs and has set an example that the issue is a very serious one that destroys families and lives." Blair Dunn, Vigil's lawyer, said the flask was spotted by the plaintiff's adult daughter at a store in Florida. The product was not available on Taintor's website Tuesday, but was listed on Amazon along with other products bearing the same image.


Opening Bell: 3.9.15

Greece reform proposals rejected; Gross sees outflows; B-schools love hockey; "Police Arrest Man Who Allegedly Stole Woman's Car On First Date"; AND MORE.

Opening Bell: 04.03.13

Barclays High-Pay Culture Brought Disrepute: Report (WSJ) Barclays PLC suffered from "a lack of self-awareness" in recent years as a culture of high pay and short-term incentives brought the bank into disrepute, according to an independent report by lawyer and investment banker Anthony Salz. The Salz Review, which was commissioned by Barclays' former chairman after the bank admitted to trying to rig interbank interest rates last summer, describes how in about 10 years the lender expanded to become a disparate set of businesses, each with its own culture. "The result of this growth was that Barclays became complex to manage," the report published Wednesday said. "Despite some attempts to establish group-wide values, the culture that emerged tended to favor transactions over relationships, the short term over sustainability, and financial over other business purposes." The 235-page report—which cost Barclays about £17 million ($25.7 million) to have produced—recommended a series of reforms aimed at trying to foster a common sense of purpose across the bank. To this end, Barclays' board must play a more active role in overseeing the business and Barclays' human resources department must be given more power to stand up on issues such as pay, the report said. Ex-Goldman Sachs Trader Taylor Said to Surrender to FBI (Bloomberg) Former Goldman Sachs Group Inc. traderMatthew Taylor planned to surrender today to the Federal Bureau of Investigation, a person familiar with the matter said. Taylor was accused Nov. 8 by the U.S. Commodity Futures Trading Commission of concealing an $8.3 billion position in 2007 that caused New York-based Goldman Sachs to lose $118 million. Morgan Stanley hired Taylor in March 2008, less than three months after Goldman Sachs disclosed in a public filing that he had been fired for building an “inappropriately large” proprietary trading position. Cyprus Bailout Details Emerge After IMF Deal (WSJ) The IMF statement set out the tough terms the tiny nation of 800,000 has to meet to get the bailout, calling the task ahead "challenging." Cyprus, an economy of roughly €17 billion in annual output, needs to push through cuts and savings worth 4.5% of gross domestic product by 2018 to hit a primary-surplus target of 4% of GDP outlined in the bailout deal, the IMF statement said. These cuts will come on top of savings worth 5% of GDP the government is already implementing through to 2015. An extra 2% of GDP in extra revenue will come from an increase in the country's corporate tax from 10% to 12.5% and an increase in the tax on interest income from 15% to 30%. The country's corporate-tax rate will remain among the lowest in Europe, on an equal footing with Ireland's, and will allow Cyprus to continue to use its tax regime to attract businesses, but the increase in withholding tax will make it substantially less attractive as a place for individuals to leave their savings. Cyprus Leader Invites Family Firm Probe (FT) Cyprus president Nicos Anastasiades has urged judges investigating the country's banking disaster to examine transactions handled by his family law firm as "a priority" in a bid to defuse public anger over last-minute transfers by well-connected Cypriots, Russians and Ukrainians who thereby avoided a "haircut" on their uninsured deposits. The move followed questions over whether a company managed by the president's son-in-law made use of inside information to transfer more than 20 million euros out of Laiki Bank days before its collapse. Marc Lasry In French Follies (NYP) Lasry, the CEO and co-founder of Avenue Capital, is on his way to getting a plum assignment as the US ambassador to France as a reward for his many years as a big Democratic fundraiser. But the Moroccan-born, French-speaking American could encounter some uncomfortable moments when he lands in Paris, given his views on the land of fine wine, crusty baguettes — and European socialism. “We don’t invest in France,” he said at a New York hedge-fund conference sponsored by French bank BNP in June 2010, even apologizing to his hosts as he made the comment. Lasry, who is a bankruptcy lawyer by training, loves to chide other countries for their creditor-unfriendly ways. His $11.7 billion distressed debt fund buys up beaten-down credits of companies headed towards bankruptcy, with the payout determined by their ranking in the process. That can be dicey in countries like France, he explained at the BNP conference, as “the legal system is very much tilted towards helping unions and workers.” As a result, he said, “you might find your claim disallowed.” 1,000 pot plants seized in Queens in warehouse raid (NYDN) A massive drug operation went up in smoke Tuesday when law enforcement officials raided an indoor marijuana farm in Queens. Authorities seized more than 1,000 pot plants - along with grow lights and other gear - from the 44th Rd. warehouse in Long Island City just after 3 p.m. , police sources said. Officials from the NYPD, state police and the federal Drug Enforcement Agency also rounded up five suspects in the sweep. New York-for-Buenos Aires Swap Theory Spreads: Argentina Credit (Bloomberg) Argentina’s refusal to improve its offer to holders of defaulted debt suing for full payment in the U.S. is deepening speculation that the nation will sever ties with the overseas bond market. The proposal submitted on March 29 mimics the terms of Argentina’s 2005 and 2010 debt exchanges, a move that could lead to a default on the restructured notes unless the country removes them from U.S. jurisdiction. BofA Chief Moynihan Said to Summon Managers for Revenue Push (Bloomberg) Bank of America Corp. Chief Executive Officer Brian T. Moynihan has summoned more than 100 of his regional leaders to a private meeting today where they’ll be pushed to boost the lender’s flagging revenue, said two people with direct knowledge of the project. Managers at the two-day event in Chicago will be judged on how much progress they’ve made in helping to sell more products to the 53 million customers of the second-biggest U.S. lender, said the people, who asked for anonymity because Moynihan’s plan hasn’t been made public. Revenue has dropped every year of Moynihan’s three-year tenure as he sold assets, repaired the firm’s balance sheet and settled more than $40 billion in claims tied to defective mortgages. Private Sector Adds 158,000 Jobs (WSJ) Economists surveyed by Dow Jones Newswires expected ADP to report a gain of 192,000 private jobs. However, the February job gain was revised up to 237,000 from 198,000 reported a month ago. SEC Embraces Social Media (WSJ) In a ruling that portends changes to how companies communicate with investors, the Securities and Exchange Commission said Tuesday that postings on sites such as Facebook and Twitter are just as good as news releases and company websites as long as the companies have told investors which outlets they intend to use. Gray seal pup saved from death on Montauk beach now recovering (NYDN) The three-month-old seal, underweight at 40 pounds, is now resting in one of the foundation's rehabilitation tanks at the Atlantic Marine World aquarium in Riverhead. "She feels very sassy in her tank and doesn't appreciate anything we are doing for her," laughed Kimberly Durham, director of the rescue program, "which is a good sign. A nasty seal is a good sign that she is getting better because they are wild animals.