Gundlach Sees ‘Blockhead’ Fed Repeating European Errors on Rates (Bloomberg)
Jeffrey Gundlach said if the Federal Reserve raises interest rates in the middle of 2015 the central bank will have to reverse course. The billionaire co-founder of DoubleLine Capital made the comments in an investor presentation Tuesday that covered bond markets, U.S. housing, global demographics and currencies. He criticized the Fed for not learning from errors made by global counterparts, which raised interest rates and then had to cut them, and Chair Janet Yellen for spending too much time with foreign officials. “The Fed is intent on being a blockhead,” Gundlach said on the conference call, referring to the game he played as a child where participants build a tower from blocks without it collapsing on their turn.
Investors Await Details on Bank Dividends (WSJ)
Overall, analysts expect all 24 U.S. banks that have taken the test in recent years to increase dividends in 2015. That would represent the fifth year in a row of a cumulative increase for the 24 banks and put the payouts at their highest levels since 2008, according to data provided by Thomson Reuters. On a per-share basis, dividends are expected to increase about 11% from 2014 at the 24 banks, which make up the bulk of the 31 global banks tested. Of course, some banks may disappoint investors because the Fed either nixes their capital-return plans or requests a scaled-down version in order to keep the banks well capitalized in case of another financial crisis. Goldman Sachs Group Inc., in particular, drew worries from some analysts last week after one of the firm’s capital ratios only narrowly surpassed a Fed minimum.
Big Names Put Cash In Bitcoin Startup 21 Inc. (WSJ)
A Silicon Valley startup has persuaded some of the biggest names in venture capital to put $116 million behind its plan to turn the technology behind bitcoin into a mass-marketed phenomenon. The funding, raised over a series of rounds for San Francisco-based 21 Inc., is the largest investment yet accumulated by a startup in the digital-currency sector, based on data from bitcoin news service Coindesk. The company hasn’t disclosed an independent valuation. Nor has it publicly disclosed precisely how it will use those funds, though Chief Executive and co-founder Matthew Pauker flagged “several interesting developments over the next weeks and months” that will deal with software and hardware products designed “to drive mainstream adoption of bitcoin.”
In Tidjane Thiam, Credit Suisse Gets Risk Expertise (Dealbook)
Tidjane Thiam (pronounced Tee-JAN Tee-AM) will cut an unusual figure for a Swiss bank chief. An African francophone, he has never worked for an investment bank. He has completed stints at McKinsey, the World Bank and two insurance companies since 2009. He was the head of one of those insurers, Prudential, which has no relation to the United States company with the same name. Mr. Dougan, in contrast, worked on the derivatives, bond trading and equity trading desks at Credit Suisse’s investment bank, which has large operations, in his 25 years at the bank.
Commuters Pick Up Pot Bales Tossed From Fleeing SUV (AP)
An Arizona sheriff's department says some of the marijuana bales that suspects tossed out of an SUV during a high-speed chase last week got picked up by passing vehicles. Dash-cam video released by the Pinal County Sheriff's Office shows many of the 21 bales of pot inside the SUV flying out a window and onto roadways during the March 4 chase. Several of the bales broke apart as they bounced on the pavement. Sheriff's Office spokesman Jim Knupp said Tuesday that 17 bales totaling 374 pounds of marijuana were recovered, and four or five vehicles were seen stopping to pick up the rest. The chase spanned Interstates 8 and 10 near Casa Grande in south-central Arizona and several local roads. It ended when the SUV pulled off a two-lane road and stopped after driving over tire-puncturing sticks.
Goldman Judge Advises Against Group Discrimination Suit (Bloomberg)
Women suing Goldman Sachs Group Inc. for alleged discrimination in pay and promotions shouldn’t be allowed to bring their case against the bank as a group, a judge recommended. U.S. Magistrate Judge James Francis in Manhattan said Tuesday that the claims in the suit, filed in 2010 by two women seeking to represent female associates and vice presidents in three Goldman Sachs divisions, are too different from one another to be considered in a single class action. The magistrate judge called the decision a “close” call. Francis’s recommendation will go to U.S. District Judge Analisa Torres, who will make the final decision. Goldman Sachs denies discriminating against women.
History Suggests OPEC's Days Could Be Numbered (Bloomberg)
OPEC, the Organization of the Petroleum Exporting Countries, has vowed to defend its market share against higher-cost producers such as U.S. shale drillers and companies developing Canada's oil sands. Its strategy hinges on the odds that an extended period of low prices will lead other producers to scale back output, enabling the group to reassert its influence. OPEC supplies about 40 percent of the world's crude. Yet a brief history detailed by the World Bank Group shows how difficult it can be to maintain a commodities cartel in the face of market forces and technological advances.
A Sailor’s Salary: $300,000, If He Works for Larry Ellison (WSJ)
A lawsuit against Larry Ellison ’s sailing squad, which has led to the seizure of one of his million-dollar boats, is also revealing how much the Oracle Corp. founder is willing to spend to win the America’s Cup: $300,000 a year for a rank-and-file sailor.
'My wife is a cheater' graffiti found at house fire (UPI)
Authorities in Colorado said a man was arrested in connection with a house fire where responders found graffiti reading, "My wife is a cheater." The Arvada Fire Protection District said crews responded about 1:30 a.m. Tuesday to reports of an explosion at a home and firefighters arrived to find the home engulfed in flames and debris spread into the street. Investigators said all of the home's occupants were out of the house at the time of the incident and no injuries were reported. Firefighters responding to the blaze discovered "My wife is a cheater" had been spray-painted on the house in two places. The graffiti was covered with blue tarps by fire crews.