Opening Bell: 6.1.15

WaMu execs still want their golden parachutes; Greece could use a hand; Winkelvii twins say this is Bitcoin's year; "Florida Man Slashes Tires After Woman Takes His Bingo Seat"; and more.
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WaMu ‘Golden Parachutes’ Contested (WSJ)
Seven years after Washington Mutual Inc. collapsed in the biggest U.S. bank failure, two of its former top executives are still looking for their “golden parachutes.” Former Chief Operating Officer Stephen Rotella and David Schneider, former president of the home-loans unit, are among a group of about 70 former employees who say they are entitled to “golden parachute” payments, or compensation usually guaranteed to employees when a company is sold. The liquidating trust created in 2012 to chase down and distribute the company’s remaining assets is seeking a ruling in U.S. District Court in Washington prohibiting such payments. The court may rule as soon as this week. According to filings, the employees argue the payments should have been triggered by the seizure and subsequent sale of WaMu’s banking assets to J.P. Morgan Chase & Co. in September 2008. WaMu’s liquidating trust counters that the demands shouldn’t be met and that the claims are blocking $64 million from being distributed to creditors.

Greece’s Tsipras Warns Bell May Toll for Europe (Bloomberg)
“The lack of an agreement so far is not due to the supposed intransigent, uncompromising and incomprehensible Greek stance,” Tsipras said in the article published on Sunday. “It is due to the insistence of certain institutional actors on submitting absurd proposals and displaying a total indifference to the recent democratic choice of the Greek people.”

Bitcoin struggles for legitimacy (NYP)
The problem? A simple lack of rules and regulations, according to a small but high-profile cadre of New York City-based bitcoiners. But a high-profile group of investors are hoping to change that. Most famous among New York’s bitcoin evangelists are Tyler and Cameron Winklevoss. They’re preparing to launch an FDIC-insured exchange called Gemini, which they have likened to a Nasdaq for bitcoin. “We believe that this will be the year of infrastructure for bitcoin,” Tyler Winklevoss told The Post.

Florida Man Slashes Tires After Woman Takes His Bingo Seat: Cops (AP)
A Florida man reacted poorly to a woman sitting in his preferred bingo seat, so he'll now have to stand in front of a judge. Fred Smith, 82, was arrested for criminal mischief on Monday after he allegedly used an ice pick to slash the tires of a van belonging to 88-year-old Ethel Britt, the Associated Press reports. The alleged tire slashing occurred at the Lake Ashton Retirement Community Club House in Lake Wales, Florida. Police said Smith was angry when he saw Britt sitting in his favorite seat, so he stormed out of the game and punctured two of the tires on Britt's van, WFTV reports.

Intel Agrees to Buy Altera for $16.7 Billion (Dealbook)
The deal comes after the two American companies held talks earlier this year. Further discussions had been delayed, however, when Altera rejected an earlier offer by Intel, people briefed on the talks have said. Under the terms of the transaction, Intel would pay $54 a share in cash for Altera.

Citigroup Likely to Close Banamex USA (WSJ)
Citigroup Inc. is expected to shut down Banamex USA, a California unit that specializes in moving money across the southern U.S. border and has been battered by accusations of weak money-laundering controls, according to people familiar with the matter. The bank has floated the idea with regulators as part of discussions to settle probes related to Banamex USA’s anti-money-laundering controls, the people said. A wind-down of the unit, which would include returning deposits to customers, could take a year or more.

Carnegie Mellon Reels After Uber Lures Away Researchers (WSJ)
Uber envisions autonomous cars that could someday replace its tens of thousands of contract drivers. With virtually no in-house capability, the San Francisco company went to the one place with enough talent to build a team instantly: Carnegie Mellon’s National Robotics Engineering Center, or NREC. Flush with cash after raising more than $5 billion from investors, Uber offered some scientists bonuses of hundreds of thousands of dollars and a doubling of salaries to staff the company’s new tech center in Pittsburgh, according to one researcher at NREC. Uber declined to comment on that.

Meet the Central Bankers Who Fight With Tomatoes and Owls (Bloomberg)
The agricultural project in Pangalengan, in the hills south of the provincial capital of Bandung, is one of many led by Bank Indonesia’s 18 offices, from corn fields in Medan to seaweed farms in Lombok and cattle ranches in Kupang. In each case, central bankers like Hadi head to the fields, out to sea or to ranches to directly address the supply side of the inflation equation.

Coming Soon: The Greatest Night Of Your Life (DB)
The fifth installment of DB Dramatic Reading Night returns June 24. Buy your ticket now. (Here's a sneak peek.)

Drunken Minnesota man falls from hot tub, impales leg on fence post (UPI)
A Minnesota man in his 20s impaled his thigh on a metal fence post after falling from a second-story hot tub, according to police. The incident occurred at about 11 p.m. Saturday in Golden Valley, Minn. The unidentified man was sitting on the edge of a hot tub on the upper level of a home when he fell to the lower level and landed on a wrought iron fence post, police say. The post impaled his thigh, and a witness says the man used a ladder to support his weight until three responding officers held him up as firefighters cut off a corresponding portion of fence. Sgt. Dave Born of the Golden Valley Police Department told WCCO this occurred "while the victim was in a lot of pain, and bleeding." Born said the man was lucky the post did not impale his groin area or femoral artery, which is located in the upper thigh. Emergency crews took the man to North Memorial Medical Center with non-life threatening injuries. Police say alcohol was a factor in the incident.

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Opening Bell: 03.05.13

Senate Report Said To Fault JPMorgan (NYT) A report by the Senate Permanent Subcommittee on Investigations highlights flaws in the bank's public disclosures and takes aim at several executives, including Douglas Braunstein, who was chief financial officer at the time of the losses, according to people briefed on the inquiry. The report's findings — scheduled to be released on March 15 — are expected to fault the executives for allowingJPMorgan to build the bets without fully warning regulators and investors, these people said. The subcommittee, led by Senator Carl Levin, could ask Mr. Braunstein and other senior executives to testify at a hearing this month, according to the people. The subcommittee does not currently intend to call the bank's chief executive, Jamie Dimon, but Congressional investigators interviewed Mr. Dimon last year. Citi CEO Is Keeping Score (WSJ) At a gathering of 300 executives last month at a Hilton Hotel in East Brunswick, N.J., Mr. Corbat proposed a slate of new, more-rigorous ways to track both the performance of individual executives and the third-largest U.S. bank as a whole, said people who were there. His approach includes score cards that will rate top managers across the New York company in five categories. "You are what you measure," Mr. Corbat told the gathering. Report Faults FSA Over Rate Rigging (WSJ) The report, commissioned by the FSA in the wake of the Barclays BARC.LN +1.48%PLC £290 million ($436.1 million) settlement with regulators over attempted rate-rigging, shows the regulator either ignored or failed to follow up on a series of red flags highlighting problems with the rates. Between 2007 and 2009, the FSA said it found 26 pieces of correspondence citing direct references to "lowballing"—where banks understated their borrowing costs to make their funding positions look stronger. These include two telephone calls from Barclays managers flagging problems with rate-setting process. The regulator also said it overlooked an article in The Wall Street Journal highlighting problems with the London interbank offered rate because the article wasn't widely read within the FSA. Heinz CEO's Golden Exit Deal (WSJ) The total would consist of a $56 million "golden parachute" including bonus payments and other items, $57 million in pension and deferred compensation and $99.7 million of Heinz shares that Mr. Johnson owns or controls, according to a Securities and Exchange Commission filing Monday. EU Said To Weigh Extra Years For Irish Rescue Loans (Bloomberg) The European Union is weighing whether to extend Ireland’s rescue loans by five years or more, buttressing the government’s efforts to become the first country to exit a bailout since the euro-region debt crisis began. Hotel boots rowdy Rodman over Kim Jong Un scene (NYP) Dennis Rodman, just back from visiting Kim Jong Un, was escorted out of the Time Hotel in Midtown on Sunday after spending hours at the restaurant bar loudly telling anyone who would listen what a great guy the North Korean dictator is. “He was at the bar at Serafina for three hours,” says a spy. “He kept saying what a nice guy Kim is, and how Kim just wants to talk to President Obama about basketball. He was waving around a signed copy of the dictator’s huge manifesto, telling everyone they should read it.” Added the witness, “Dennis was making a total jerk of himself. He wouldn’t leave, and he wouldn’t let anyone talk to him about shutting up, or what an oppressive country North Korea is. Eventually he had to leave the bar because the bartender was starting to get [bleep]ed-off.” Ikos Co-Founder Coward Sues Ex-Wife Over Hedge-Fund Software (Bloomberg) Martin Coward, the co-founder of Ikos Asset Management Ltd., sued his estranged wife, Elena Ambrosiadou, in a U.K. court over the copyright ownership of computer software that runs the hedge fund’s trading platform. Coward was the “architect” of the “bedrock of the family business,” his lawyers said at the start of a three-week trial in London today. “Practically all of the financial markets expertise at Ikos resided in Coward himself,” said Michael Bloch, Coward’s lawyer. Ikos, which uses computer algorithms to spot profitable trades in futures markets, has been embroiled in lawsuits involving Coward and other former employees around the globe. The estranged couple, who started divorce proceedings in Greece in 2009, have filed more than 40 lawsuits against each other in at least four countries. Sequester Leaves US In 'Fantasy' World: Analyst (CNBC) Stephen King, chief global economist at HSBC, said that the U.S. was living in a"fantasy world" over its growth forecasts. "If you look at the projections from the Congressional Budget Office (CBO) they assume that growth goes back to between 4 to 5 percent in real terms between 2014 and 2018. Their numbers suggest that the U.S. will post the fastest rate of productivity growth of any decade in the last 50 or 60 years," King told CNBC's "European Closing Bell." Former Lehman Derivatives Banker Helps Paschi Unravel Contracts (WSJ) Riccardo Banchetti, whose work packaging derivatives at Lehman Brothers Holdings Inc. got him the top European job at the firm a week before it failed, is now making a living unraveling the kind of deals he once developed. Banchetti worked with Banca Monte dei Paschi di Siena SpA to uncover 730 million euros ($955 million) of losses that the world’s oldest bank hid through the use of derivatives. The Italian banker, who also advised JPMorgan Chase & Co. (JPM) on its defence against fraud charges over swaps with Milan, has scrutinized more than 10 billion euros of transactions since leaving Lehman, according to a person with knowledge of his activities who asked not to be identified because they weren’t authorized to speak publicly. Drugs found in Florida suspects' orifices, deputies say (WPBF) According to the Charlotte County Sheriff's Office, a deputy who initiated a traffic stop on a car without brake lights found cocaine in a man's prosthetic leg. The deputy also found morphine and hydromorphine pills in a woman's bra and a hypodermic needle hidden in another woman's buttocks.

Opening Bell: 08.22.12

Public Pension Funds Named To Lead ‘London Whale’ Lawsuit (Bloomberg) U.S. District Judge George Daniels in Manhattan ruled today that lawsuits against the New York-based bank should be consolidated into a class action. The pension funds allege they lost as much as $52 million because of fraudulent activities by JPMorgan’s London chief investment office. The lead plaintiffs named by Daniels are the Arkansas Teacher Retirement System, Ohio Public Employee Retirement System, School Employees Retirement System of Ohio, State Teachers Retirement System of Ohio, Oregon Public Employee Retirement Fund and the Swedish pension fund Sjunde AP-Fonden. Pressures Intensify On Merkel (WSJ) The Greek government, struggling with depression-like conditions that have pushed the economy to the brink, is likely to need many billions of euros of additional aid to avoid bankruptcy. If Athens doesn't get the money, it may be forced to leave the euro, an outcome that would undermine financial markets' tenuous confidence in other vulnerable southern euro members, including Spain and Italy. An expansion of Greece's €173 billion ($213.4 billion) bailout that was agreed to this spring faces adamant opposition in Ms. Merkel's center-right coalition in Germany's parliament, the Bundestag. Her junior coalition partners are especially against lending Greece more money, threatening to leave her either without a governing majority—or without a plausible way to cover Athens's funding gap. "It is one of the hardest dilemmas she has faced as chancellor," said an adviser to Ms. Merkel. The chancellor is set to meet with French President François Hollande on Thursday and Greek Prime Minister Antonis Samaras on Friday, meetings the chancellor's aides say will help determine Berlin's course. Austria's AAA Rating Under Attack From East and West (CNBC) Of the three major credit rating agencies, only Fitch Ratings still rates Austria triple-A with stable outlook. Moody’s Investors Service put Austria’s top notch rating on negative watch in February, while Standard & Poor’s downgraded the country to double-A plus with negative outlook in January. Facebook Challenged By Swedish Count’s Jet-Set Website (Bloomberg) The BestofAllWorlds site, which starts Aug. 27, will allow users to mingle online with like-minded people, find restaurants and nightlife in city guides and discover who’s attending events such as Art Basel in Miami and England’s Royal Ascot horse racing, said Erik Wachtmeister, whose father was a Swedish ambassador to the U.S. “Facebook is a monopoly in the social sphere, but it only gives little value,” Wachtmeister said in an interview in London. “We can deliver clever filters, cut through the mess and get information that’s relevant and we can trust.” Fed Probes RBS Over Dealings With Iran (FT) The UK bank is being probed by being probed by the Federal Reserve and Department of Justice after volunteering information to them and U.K. regulators about 18 months ago, several people close to the situation said. The bank uncovered the alleged failings after Chief Executive Stephen Hester initiated an internal review not long after his arrival three years ago...The probe marks the latest blow for RBS following a series of mishaps including an IT failure, widespread mis-selling of retail and small-business products and its involvement in the scandal over the alleged manipulation of Libor interest rates Suspect asks DeLand doughnut shop worker for pen to write robbery note (NYP) An embarrassed Atlantic City casino is suing 14 gamblers — including two Big Apple residents — demanding they return the whopping $1.5 million they collectively won after realizing the mini-Baccarat table they were playing at was using unshuffled decks of cards. The sharp-eyed gamblers racked up a staggering 41 winning bets in a row at the Golden Nugget after seeing cards in the eight-deck shoe coming out in sequence and adjusted their wagers accordingly — as the clueless croupiers kept on dealing. Stunned casino workers swarmed the hot table suspecting the players of cheating — but only later realized that the cards that had been ordered as pre-shuffled from a Missouri company “were not shuffled at all,” a Golden Nugget spokeswoman said yesterday. “The gamblers unlawfully took advantage of the Golden Nugget when they caught on to the pattern and increased their bets from as little as $10 to $5,000,” the casino said in a written statement...It has been met with a countersuit from three of the bettors, including Queens resident Ping Lin, who allegedly managed to collect $50,000 from the casino, and Brooklyn cook Hua Shi, who allegedly collected $149,000. They claim they should be allowed to cash in chips they won and keep the cash they already managed to collect. Nomura Retrenches, Mends Fences (WSJ) Nomura's new leaders are discussing the future of that global push as well as how to repair the company's relationship with financial authorities. On the table are deep cuts in overseas operations and a possible change to a controversial compensation plan, among other policy options, that could shift away from the globalization strategy set by former Chief Executive Kenichi Watanabe and his deputy Takumi Shibata through the acquisition of Lehman Brothers' European and Asian businesses in 2008, say people close to the talks. Last Man Standing Means Europe Investment Banks Resist Shrinking (Bloomberg) Europe’s failure to resolve its sovereign-debt crisis will force investment-banking chiefs in the region to consider shuttering entire businesses rather than rely on piecemeal job reductions to reviveprofit. Dealmaking fees may drop 25 percent this year from 2009, when the crisis began in Greece, research firm Freeman & Co. estimates. European banks have cut about 172,000 positions since then, according to data compiled by Bloomberg, the same strategy they used after Lehman Brothers Holdings Inc. collapsed in 2008. Florida couple arrested after swinger’s party takes violent turn (NYDN) Tina Michelle Norris, 39, and her boyfriend James Albert Barfield, 56, both invited guests over to their home for sex Sunday night, the Hernando Today reported. But Norris got mad when she saw her boyfriend in bed with another woman and Barfield lost his cool when he saw his girlfriend under the sheets with two other men, according to the newspaper. The pair quickly got physical, with Norris sustaining a bloody lip and Barfield suffering multiple scratch marks on his neck and back, cops told Hernando Today. Police got quite the eyeful when they arrived at 6 a.m. to arrest the couple, both of whom were still donning their birthday suits. Norris was "very intoxicated and uncooperative" and refused to put her clothes back on, Deputy Cari Smith wrote in her affidavit. Barfield was also nude when Smith arrived at the home. A roommate, who was sleeping in a separate room of the house at the time of the incident, said she awoke to shouting and yelling. She went out into the hallway and found Norris and Barfield "pushing and shoving each other from one end of the house to the other (while) breaking things in the process," Smith wrote.

Opening Bell: 01.28.13

Davos Money Men Say World Emerges From Doldrums Fretting Relapse (Bloomberg) “Optimism, but with a sober tone,” was how Bank of America Chief Executive Officer Brian T. Moynihan characterized the mood pervading the World Economic Forum’s annual meeting, even as investors were lifting the Standard & Poor’s 500 Index above 1,500 for the first time since 2007. Fed To Keep Money Spigot Open (WSJ) Federal Reserve officials are likely to continue their easy-money policies when they gather this week to weigh a mixed economic outlook and a recent run of low inflation. The Fed has said it would maintain its $85 billion bond-buying programs, aimed at boosting the economy by lowering long-term interest rates, until it sees substantial progress in labor markets. It has also said it would keep short-term interest rates near zero until the jobless rate drops to at least 6.5%, as long as inflation remains steady. Beneath the Calm, SAC Works to Contain Fallout From Inquiry (NYT) "This has always been a stressful place to work," said an SAC employee who requested anonymity because he was unauthorized to speak publicly about the fund. "Now it's just more stressful." Mr. Cohen's fund was dealt a blow last week when a Citigroup unit that manages money for wealthy families disclosed that it was withdrawing its $187 million investment. The move by the bank was the most prominent client departure since November, when the multiyear investigation into SAC's trading practices entered a more serious phase. Citigroup's withdrawal represents a tiny percentage of SAC's $14 billion in assets under management. The fund has said it expects total investor redemptions for the first quarter of up to $1 billion, a number that an SAC spokesman has said will not adversely affect its business...Still, the Citigroup decision stung, say peopleclose to SAC's business, because of the longstanding and lucrative relationship between the bank and the fund. Another concern, said these people, is that the move could influence other large SAC investors currently weighing whether to keep their money at the fund. For Citigroup, its withdrawal of money from SAC carries substantial business risk. The bank has a vast relationship with SAC, earning revenue by providing the fund with financing and trading services. SAC could exact retribution on Citigroup by terminating, or at least scaling back, its broader relationship with the bank. An SAC spokesman declined to comment. Credit Suisse Could Owe $2 Billion Over Fraud (Reuters) Credit Suisse Group faces a potential $2 billion of exposure over fraud that occurred a decade ago at National Century Financial Enterprises, a result of a federal judge's determination on how to apportion responsibility. Friday's decision by U.S. District Judge James Graham could expose the Swiss bank to hundreds of millions of dollars of added liability over the activities of Lance Poulsen, who co-founded National Century in 1990 and was its chief executive. He is now serving a 30-year prison term and is presumed insolvent. Goldman Raising $1 Billion From ICBC Share Sale (WSJ) The Wall Street company is selling the Hong Kong-listed shares in a block trade at 5.77 Hong Kong dollars (US$0.74) each, the people said, without disclosing the number of shares. The price represents a 3.0% discount to ICBC's HK$5.95 closing price Monday. A person familiar with the situation said the sale reflects prudent risk management on Goldman's part to reduce the size of its ICBC investment. MBA's Salary Enhancing Power Slashed (FT) Students on the top US MBA programs in the mid-1990s saw their salaries triple in five years, but those who graduated from the same schools in 2008 and 2009 saw that increase halved, according to data collected for the FT's annual Global MBA rankings. At the same time, MBA fees have risen by 7 percent a year. MBA students who enrolled in 2012 paid 62 percent more in fees - up 44 percent in real terms - than those who began their programs in 2005, even though the increases in post-MBA salaries remained in line with inflation. Beyonce has yet to apologize to Chuck Schumer for lip-syncing at inauguration (NYP) The New York senator angrily admitted yesterday that the pop queen has not called him to say sorry after she turned last week’s inaugural bash into an unexpected Milli Vanilli concert by lip-syncing “The Star-Spangled Banner.” “I have not heard from her before, during or after,” a testy Schumer told The Post after he was asked if Beyoncé had called him to give a musical mea culpa. “She did not talk to me at all. I didn’t say any words to her, period.” Schumer has been credited with drawing the pop diva and her hubby Jay-Z to the inauguration, where many said they stole the show from the president and first lady walking hand-in-hand on the steps of Capitol Hill. Schumer was seen beaming with pride just steps behind Beyoncé while she appeared to be belting out the National Anthem. Obama administration insiders and inauguration planners were in the dark about Beyoncé’s decision to use a prerecorded tape of her singing with the Marine Band during the swearing in. They were later left fuming over the embarrassment, according to reports. Some on Capitol Hill have even placed the blame on Schumer for the Star-Spangled sham. There’s a Twinkie in the eye of Apollo (NYP) Hostess Brands is expected to name Leon Black’s Apollo Global Management as the preferred bidder for Twinkies and its other snack brands, The Post has learned. The announcement from the bankrupt baker could come as soon as today, sources said. The selection of Apollo would give Manhattan buyout billionaire Leon Black the inside track to buying one of the country’s most well-known consumer brands. Black’s Apollo and co-bidder C. Dean Metropoulos, a veteran food exec, were vying with Grupo Bimbo, the Mexico-based baker, for the right to be the preferred, or stalking horse, bidder for Twinkies, Ho Ho’s, Ding Dongs and other Hostess snacks. Bank of America Moves $50 Billion of Derivatives to UK (FT) Bank of America has begun moving more than $50bn of derivatives business out of its Dublin-based operation and into its UK subsidiary, according to people close to the operation. The move, part of the group's global drive to rationalize its operations, has been encouraged by regulators but will also allow BofA to benefit from tax breaks stemming from the accumulated losses in its UK business. Singer Backs Off Aggressive Stance In Dealings With Buenos Aires (NYP) After a decade of aggressively pursuing $1.44 billion he claims the country owes him and a group of bondholders, including successfully pressing Ghana to seize a locally docked Argentine naval vessel to help pay down the debt, the billionaire New York hedge fund mogul is sounding like Bobby McFerrin in “Don’t Worry, Be Happy.” Singer’s Elliott Management now feels Argentina will do the right thing, according to recent court filings. It’s quite a change from last fall’s legal arguments, in which Singer urged a federal judge to hurry up and force Buenos Aires to put some of the monies owed into escrow, citing the country’s president’s plot to avoid the debt payment. Italians Have a New Tool to Unearth Tax Cheats (NYT) Despite the government's best efforts, tax evasion remains something of a pastime in Italy, where, famously, more than a few of the Ferrari-driving set claim impoverishment when it comes to declaring their incomes. So this month, not without controversy, the National Revenue Agency decided to try a new tack. Rather than attempting to ferret out how much suspected tax cheats earn, the agency began trying to infer it from how much they spend. The new tool, known as the ''redditometro,'' or income measurer, aims to minimize the wiggle room for evasion by examining a taxpayer's expenditures in dozens of categories, like household costs, car ownership, vacations, gym subscriptions, cellphone usage and clothing. If the taxpayer's spending appears to be more than 20 percent greater than the income he or she has declared, the agency will ask for an explanation. Traders Make Peace With Computers (WSJ) On a recent day on Barclays PLC's stock-trading desk in Manhattan, an electronic platform posted a notice that Barclays was selling a large block of Pfizer shares. In recent years, a computer typically would have swiftly matched such an order with a buyer, sidestepping trading floors altogether. But soft trading volume has left many traders unable to move stock as quickly as they might like. That is one reason why Barclays connected its recently launched DirectEx platform to its trading floor. The move paid off when a client who was buying 150,000 shares on the electronic network decided, after chatting with a Barclays salesman, to take an additional 150,000 shares. Woman Found with 92 Pounds of Marijuana in N. Bellmore (Patch) According to detectives, around 6 p.m., an unmarked First Precinct police car observed Mizzie Artis, 27, of Bellport, operating a 1999 Hyundai eastbound on Columbus Avenue while talking on a cell phone and not wearing a seat belt. Police then observed Artis drive to Armand Street where she met with a male subject in a minivan. As officers drove by both vehicles to further observe, the male subject fled the scene in the van, police said. Artis drove away and failed to stop at a stop sign and did not signal when turning, police said. Officers stopped Artis and, upon approaching the car, observed two large cardboard boxes in the auto. Officers also detected an odor of marijuana emanating from the vehicle. K-9 officers responded to the scene and performed a narcotic search of the vehicle. The cardboard boxes in the front seat had a positive alert for narcotics, police said. Two additional boxes were recovered from the trunk containing marijuana, bringing the total approximate weight to 92 pounds.

Opening Bell: 03.04.13

Euro-Zone Deal Faces Hurdles (WSJ) Germany's reluctance to put its taxpayers' money at risk in other countries' banks is proving the biggest obstacle to letting the euro zone's bailout fund, the European Stability Mechanism, invest directly in banks that need more capital. In Ireland, Spain, Greece and Cyprus, bailouts of struggling banks are placing heavy burdens on the state, adding to fast-rising national debts. Buffett Disappointed With Berkshire's 'Subpar' $24 Billion Gain (CNBC) Warren Buffett called 2012 "subpar" in his annual letter to shareholders as Berkshire Hathaway's per-share book value rose 14.4 percent, less than the S&P 500's 16-percent increase. It's the ninth time in 48 years this has happened. Buffett notes that the S&P has outpaced Berkshire over the past four years and if the market continues to gain this year the benchmark stock index could have its first five-year win ever. "When the partnership I ran took control of Berkshire in 1965, I could never have dreamed that a year in which we had a gain of $24.1 billion would be subpar ... But subpar it was." Buffett: Berkshire on hunt for more Heinz-like deals (Reuters) "If we get a chance to buy another Heinz, we will do that," Buffett said on CNBC. Berkshire likes the ketchup maker's business, the price of the $23 billion deal, and its partner in the transaction, private equity firm 3G Capital, Buffett said in an extended interview. HSBC Reports Declining Profit and Says Costs Are Increasing (Bloomberg) Pretax profit for 2012 dropped 5.6 percent to $20.65 billion, trailing the $23.49 billion estimate of 26 analysts surveyed by Bloomberg. Revenue fell 5.4 percent to $68.33 billion from $72.28 billion, HSBC said today in a statement. Chief Executive Officer Stuart Gulliver is being thwarted in his plan to reduce costs to 48 percent to 52 percent of revenue as the London-based lender set aside $1.9 billion to settle U.S. money-laundering probes and boosted spending on compliance by $500 million. Expenses as a proportion of revenue climbed to 62.8 percent from 57.5 percent, and wage inflation in markets such as Latin America is increasing, HSBC said today. Swiss Back Executive-Pay Controls (WSJ) The plan, dubbed the "rip off" initiative by the country's media, bans so-called golden-handshake and golden-parachute severance agreements. It also requires greater transparency on loans and retirement packages for senior executives and directors. Beauty queen took my heart, then she took me for $96,000 ride: hedge-funder's suit (NYP) Rishi Bajaj, 33, says he opened his heart, then his wallet, to Miss New Mexico Teen USA 2007 Liz Kranz after she told him she was considering selling her eggs to raise cash for a relative in rehab. The sob story got the beauty a $20,000 loan from Bajaj, he claims in a Manhattan Supreme Court lawsuit. Bajaj, who co-manages the $620 million hedge fund Altai Capital, then told Kranz, 24, to pick out a car for the couple to share — and was “surprised” when she selected a 2012 BMW that came with a $17,070 down payment. They met in July 2012 and dated for “several months,” even vacationing together in Italy, where, Bajaj said in court papers, he let Kranz use his American Express card. Kranz, of the Lower East Side, was also allowed to use Bajaj’s AmEx to buy a dress for a wedding they attended. Bajaj and Kranz, who lived briefly in LA, eventually broke up. There were “disagreements about their remaining obligations to each other,” Bajaj said in court papers. He claims the pageant queen kept her hands on his credit card and racked up tens of thousands in charges...In all, Bajaj claims Kranz spent $58,860 on his credit card over three months last year. In a November letter, his lawyer accused her of “theft, fraud and other egregious misconduct” and demanded she repay the full $58,860 in credit-card purchases. NYC to be hit hard by sequester: Merrill Lynch economist (NYP) Two months’ worth of job gains are about to vanish nationwide, warns a Merrill Lynch economist — and New York City, whose unemployment rate is already at an eye-popping 8.8 percent, will be hit exceptionally hard in this employment carnage as Washington begins to enact a series of controversial spending cuts known as the sequester. “It will set the economy back a few months in the job market,” Ethan Harris, co-head of global economics research at Bank of America Merrill Lynch, told The Post. “The national job market recovery has been modest, and it has been weaker locally in New York.” Nationally, Harris calculated a loss of about 300,000 jobs, roughly two months of average job gains, if the sequester is enacted untouched. Job-Hunt Time Shrinks in U.S. From Record High (Bloomberg) For 13 million out-of-work Americans, record spells of joblessness are abating. The median duration fell to 16 weeks in January from 25 weeks in June 2010, Labor Department data show. Fewer people compete for each opening as hiring expands, and persistent long-term unemployment is starting to mend. The progress supports Federal Reserve Chairman Ben S. Bernanke’s view that America’s labor market remains flexible and isn’t succumbing to hysteresis, or permanently higher joblessness, similar to Europe in the 1980s, said Dale Mortensen, a professor of economics at Northwestern University in Evanston, Illinois, and 2010 Nobel laureate. That suggests continued monetary stimulus can bring about a faster healing. Slim Risks Losing World’s Richest Person Title as Troubles Mount (Bloomberg) Slim’s lead over the next-wealthiest man, Bill Gates, narrowed last week to about $4.8 billion -- the closest spread in almost a year. The Lebanese immigrant’s son, who acquired Mexico’s phone monopoly and turned it into a pan-Latin American powerhouse, lost almost a 10th of his net worth last month, winnowing his fortune to $71 billion, according to the Bloomberg Billionaires Index. Dennis Rodman: Kim Jong Un Wants President Obama to ‘Call Him’ (ABC) In his first interview since returning to the U.S. from an unprecedented visit to North Korea last week, former NBA star Dennis Rodman said he bears a message for President Obama from the country’s oppressive leader, Kim Jong Un. “He wants Obama to do one thing: Call him,” Rodman told ABC’s George Stephanopoulos on “This Week.” “He said, ‘If you can, Dennis – I don’t want [to] do war. I don’t want to do war.’ He said that to me.” The athlete also offered Kim some diplomatic advice for potential future talks with President Obama. “[Kim] loves basketball. And I said the same thing, I said, ‘Obama loves basketball.’ Let’s start there,” Rodman said.

Opening Bell: 04.26.12

Barclays Cautious Despite Investment Bank Gains (WSJ) In the first quarter of 2012 Barclays said total revenue fell 25% to £5.52 billion ($8.92 billion) from £7.34 billion a year before. The group recorded a net loss of £337 million for the quarter compared with net profit of £1.24 billion a year earlier. Chief Executive Bob Diamond said the business environment picked up in the second half of last year, but "frankly it remains quite challenging." Mr. Diamond warned that economic conditions across Europe and the U.K. had deteriorated since January, as the sugar rush caused by cheap loans dished out by the European Central Bank began to fade. "It was not a robust first quarter; it was only robust compared to the third and fourth quarter," Mr. Diamond said. "There is still slow economic growth around the world." Deutsche Bank Profit Drops On Debt Crisis (BW) The slowdown in April hasn’t been “significant” and Deutsche Bank needs to assess the effect of the Easter holidays on revenue, Chief Financial Officer Stefan Krause said today on a conference call. Pretax profit at Deutsche Bank’s investment banking unit fell to 1.72 billion euros in the first quarter from 2.29 billion euros a year earlier and compares with a 422 million loss in the fourth quarter. That beat the 1.64 billion-euro average estimate of eight analysts. More Americans Than Projected Filed Jobless Claims Last Week (Bloomberg) Jobless claims fell by 1,000 to 388,000 in the week ended April 21 from a revised 389,000 the prior period that was the highest since early January, Labor Department figures showed today in Washington. The median forecast of 48 economists surveyed by Bloomberg News called for a drop to 375,000. SEC Faces Questions About Tipster Policy (WSJ) "Whistleblowers are essential to root out fraud and malfeasance," the senator wrote in a letter sent Wednesday afternoon to SEC Chairman Mary Schapiro and reviewed by the Journal. "I am concerned that the SEC may not be properly protecting the identity of whistleblowers and others who come to the SEC with information on securities law violations." La Guardia flights delayed when dog flees Delta jet and sprints to runway (NYP) A puppy took flight at La Guardia Airport yesterday, speeding down a busy runway and dodging planes and a posse of desperate pursuers. Taxiing airliners ground to a screeching halt, giving their passengers front-row views of the spectacle that at one point saw a frustrated worker get down on his hands and knees in an unsuccessful attempt to convince the 14-month-old Rhodesian ridgeback, named Byrdie, to surrender. In a final fit of desperation, Port Authority cops pulled the dog’s owner, Austin Varner, off her Delta flight and drove her out to the tarmac. Byrdie broke free while being loaded on the plane in a kennel at around 10:20 a.m. — and the 70-pound pooch made a beeline down the tarmac. An air-traffic controller barked into his radio, “We got a dog running like crazy down there.” Former Morgan Stanley Exec Pleads Guilty In Anti-Bribery Case (Reuters) A former Morgan Stanley executive pleaded guilty to conspiring to evade internal controls required by a US anti-bribery law, in a case that underlines the fall of a once high-flying dealmaker for the firm in China. Garth Peterson, who was a managing director in Morgan Stanley’s real estate investment and fund advisory business, also settled yesterday related charges with securities regulators, and agreed to roughly $3.7 million in sanctions and a permanent bar from the industry. Peterson secretly arranged to have millions paid to himself and a Chinese official and disguised the payments as finder’s fees charged to Morgan Stanley, regulators said. Geithner Warns Of Economic Risks (Bloomberg) Treasury Secretary Tim Geithner is warning that the US economy faces risks from the “severe and protracted crisis” in Europe while the feud with Iran has put upward pressure on oil prices. He added the economy will encounter a “fiscal cliff” at the end of the year when large spending cuts and tax increases are set to take effect. “That cliff presents a risk, but it also provides an opportunity for bipartisan agreement Bernanke Says Prepared To Do More As Policy Unchanged (Bloomberg) “We remain prepared to do more as needed to make sure that this recovery continues and that inflation stays close to target,” he said at a press conference today following a meeting of the Federal Open Market Committee in Washington. Additional bond-buying is still “very much on the table.” Bull Market For Chicken Feed (WSJ) In case you were wondering: "Futures for soybean meal, the protein in feed that makes broilers plump and juicy, are up 34% so far this year. Prices for the yellow powder, a soybean byproduct that resembles wheat germ, are outpacing the likes of crude oil and gold." In Mayfair, outrage over tire-slashing arrest (Philly) It was a little more than two months ago when a 44-year-old butcher named David Toledo had a message for the vandal who was slashing car tires up and down his block of Aldine Street and on nearby streets in his Holmesburg neighborhood. “I feel like butchering the one who is doing this,” Toledo said shortly after reporting to police that all four tires on his Jeep Cherokee had been slashed, just one week after the same thing had happened to his wife’s car. Wednesday night, Toledo’s outraged neighbors had a message for him: Back at ya, pal. The news that police had arrested Toledo in connection with the wave of tire slashings that had plagued parts of the Northeast angered and infuriated his neighbors, as they spilled out onto front steps on a bright spring evening to gossip and to vent. Adding insult to the injured tires is the fact that Toledo had been arguably the most vocal neighbor in speaking out against the vandalism and in urging fellow residents to organize a community watch group to nab the slasher.