Opening Bell: 8.13.15

Dean Foods/Phil Mickelson probe; Greece woes; Citigroup's bad bank makes good; "Man Assaults Brother For Not Sharing Big Macs, Police Say"; and more.
Author:
Updated:
Original:

Trading Probe Eyes Ex-Chairman of Dean Foods (WSJ)
Criminal and civil authorities are investigating whether the former chairman of Dean Foods Co. leaked inside information about a corporate spinoff to a professional gambler who in turn is suspected of tipping off golfer Phil Mickelson, according to people familiar with the probe. The scrutiny of Dean Foods ex-Chairman Thomas Davis brings a high-profile investigation first reported by The Wall Street Journal last year into the boardroom of a major company. The showcase probe could test the limits of the government’s ability to pursue high-profile insider-trading cases, as its efforts have been significantly set back by a 2014 appellate-court ruling.

Attacks on Fiber Networks Baffle FBI (WSJ)
The Federal Bureau of Investigation says San Francisco’s Bay Area has suffered more than a dozen attacks on its fiber optic infrastructure over the past year. The attacks slow Internet service and disrupt financial transactions and emergency phone calls. The way the cuts are clustered on single nights around the East Bay and in San Jose, Calif., at the heart of Silicon Valley, have led officials to believe the attacks are intentional. Beyond that, they have yet to nail down a motive, let alone a culprit, creating an unusual cyber whodunit with few leads and little understanding.

Citigroup’s ‘Bad Bank’ Isn’t So Bad Anymore (WSJ)
The “bad-bank” unit of Citigroup Inc., Citi Holdings for more than six years has been the repository for businesses the banking giant wanted to dump: its retail brokerage and life insurance unit, an array of toxic subprime loans, even a stake in a Mexican auto supplier. Now, after years of losses, the unit has reported four profitable quarters in a row. It also has sold more than $700 billion in assets, an amount that rivals the balance sheets of Goldman Sachs Group Inc. and Morgan Stanley.

Greece Faces Two-Year Recession Amid Bailout Cuts (WSJ)
The country’s economy is expected to shrink 2.3% this year because of the recent months of turmoil and the cuts required by the bailout, the officials said, citing the latest estimates from the institutions that have been negotiating Greece’s new aid program. Next year, it is projected to contract 1.3%

Police find loaded gun in hollowed-out Bible (UPI)
Police said the vehicle was pulled over about 2:30 a.m. Monday and searched when officers detected the scent of marijuana. Investigators said they found marijuana, a gravity knife and the hollowed-out King James Bible containing a loaded Glock 17. DeShawn Thompson, 24, Santina Ferguson, 21, and Andre Allen, 34, were arrested on charges of criminal possession of a weapon and unlawful possession of marijuana.

Germany criticises Greek bailout (FT)
Germany’s finance ministry outlined its objections in a paper circulated to its eurozone counterparts just hours before the Greek parliament was due to debate on Wednesday the painful austerity and reform package that had been reluctantly accepted by the radical left government of prime minister Alexis Tsipras.

U.S. Appeals Ruling That A.I.G. Bailout Terms Were Too Harsh (Dealbook)
In a move that starts a new chapter in the battle over the bailout of the American International Group during the financial crisis, the Justice Department formally appealed a court ruling on Wednesday that said the government’s terms for saving the company had been too harsh...In June, Judge Thomas C. Wheeler of the United States Court of Federal Claims delivered a split decision: The Federal Reserve had indeed crossed the line by demanding a 79.9 percent equity stake in A.I.G., he ruled, and the central bank “did not have the legal right to become the owner of A.I.G.” Judge Wheeler awarded no damages, however, saying A.I.G. shareholders had not suffered financially.

American Apparel mulls bankruptcy filing amid unrest (NYP)
The embattled retailer, fighting labor unrest and a dwindling cash supply, said Tuesday its net loss swelled to $19.4 million in the second quarter from $16.2 million a year ago amid a 17 percent decline in revenue. The Los Angeles-based apparel maker had just $13 million in cash available on June 30 — having burned through roughly $23 million during the second quarter. A Chapter 11 filing is not out of the question, the company all but acknowledged in a regulatory filing.

Man Assaults Brother For Not Sharing Big Macs, Police Say (HP)
Thomas Veres, 47, was arrested early Wednesday morning after he allegedly punched his older brother, Matthew, 58, for eating three Big Macs and not saving one for him. Police said Veres was so mad that he ransacked the home they shared in Union Township, knocking over furniture and appliances and throwing food, the Washington County Observer-Reporter reports. Matthew Veres suffered injuries to his right eye and left cheek and had his ear cut during the assault, police said, according to the Associated Press.

Related

Opening Bell: 10.7.15

Fantasy sports probe; Ackman says GE was too expensive; TPG raises real estate fund; Steve Cohen is loving life; "College bro arrested over mac-and-cheese rant at food court"; and more.

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: 06.28.12

Interest Rate Probe Escalates (WSJ) Investigators in the U.S., Europe and Asia have been probing alleged wrongdoing in the interest-rate-setting process for about two years. The Barclays settlement marks their biggest win yet. A series of Wall Street Journal articles in 2008 raised questions about whether global banks were manipulating the process by low-balling a key interest rate to avoid looking desperate for cash amid the financial crisis. Emails and instant messages disclosed in the bank's settlement show how Barclays's traders tried to manipulate rates to benefit their own trading positions. "This is the way you pull off deals like this chicken," one trader told another trader in March 2007, according to the U.K. regulator. "Don't tell ANYBODY." Other banks that have disclosed they are under investigation include Citigroup, JPMorgan, Lloyds Banking Group, and RBS. None of these banks have been charged with any wrongdoing in the matter by U.S. or U.K. regulators. Calls for Diamond’s Exit After Barclays ‘Moral Failure’ (CNBC) Lord Oakeshott, a high-profile Liberal Democrat politician, said: "If Bob Diamond had a scintilla of shame he would resign. If Barclays' board had an inch of backbone between them they would sack him." Barclays admitted Wednesday that the actions "fell well short of standards.” Madoff's Brother To Plead Guilty (WSJ) Peter Madoff, 66 years old, is expected to plead guilty to two charges at a hearing Friday in Manhattan federal court, including falsifying the records of an investment adviser and a broad conspiracy count to commit securities fraud and other crimes, according to a letter sent to U.S. District Judge Laura Taylor Swain and filed in court on Wednesday. However, Peter Madoff, the firm's chief compliance officer, isn't expected to admit to knowing about the fraud itself. Instead, he is expected to admit to conduct that enabled the fraud to continue, even if he didn't know new investor money was being used to pay older investors or that no trading was being conducted at the investment firm. JPMorgan Trading Loss May Reach $9 Billion (WSJ) The bank’s exit from its money-losing trade is happening faster than many expected. JPMorgan previously said it hoped to clear its position by early next year; now it is already out of more than half of the trade and may be completely free this year. As JPMorgan has moved rapidly to unwind the position — its most volatile assets in particular — internal models at the bank have recently projected losses of as much as $9 billion. In April, the bank generated an internal report that showed that the losses, assuming worst-case conditions, could reach $8 billion to $9 billion, according to a person who reviewed the report. With much of the most volatile slice of the position sold, however, regulators are unsure how deep the reported losses will eventually be. Some expect that the red ink will not exceed $6 billion to $7 billion. Kerviel ‘Love’ May Not Be Enough To Overturn SocGen Verdict (Bloomberg) Jerome Kerviel’s statement last week that he “loved” Societe Generale may have come too late to help him win a reduced sentence for causing the bank’s 4.9 billion-euro ($6.1 billion) trading loss. Kerviel lawyer David Koubbi may use his client’s remarks during closing arguments in Paris today to offset his own frequent clashes with Judge Mireille Filippini, who threatened to notify the bar about his treatment of witnesses. With Time Running Out California Gorging Itself On Foie Gras (WSJ) California will ban foie gras sales starting Sunday. Meanwhile, goose-liver lovers still have time to enjoy foie gras jelly doughnuts at Umamicatessen in Los Angeles. Chefs there and around the state are counting down their foie gras days by putting it anywhere they can. Some plan foie gras finale feasts on Saturday night. Others offer foie gras in cotton candy, cheesecake, waffles and toffee. "It's a very difficult thing to say goodbye to," says Michael Cimarusti, co-owner and chef at Providence, a celebrated Los Angeles restaurant. He plans to leave a gap on his menu in memory of the dearly departed, with the notation: "formerly a foie gras dish."...At Craftsman & Wolves, a San Francisco bakery, Chef William Werner covers a chunk of foie-gras torchon with a chocolate cremeux that he inserts into chocolate cake batter to create his Devil Inside cake. Some chefs accept the inevitable. Celebrity chef Thomas Keller at Bouchon in Los Angeles recently replaced his foie gras dog biscuits with ones made from chicken livers. Others are looking for ways to duck the ban. Daniel Scherotter, who owns Palio D'Asti in San Francisco, is checking with his lawyer to see whether he can legally give away—rather than sell—a serving of foie gras with a $20 salad. Mr. Scherotter and others expect some restaurants to turn into "duckeasies," where diners can order foie gras using certain code words. They take inspiration from chefs such as Didier Durand, who says that, during a Chicago foie gras ban from 2006 to 2008, he served it at his Cyrano's Bistrot by listing it as potatoes. "People understood that roasted potatoes wouldn't cost $21," he says, but that's what he charged. After two years the ban was rescinded. Merkel Stands Ground Ahead Of Euro Summit (Reuters) EU leaders arrived for a Brussels summit on Thursday more openly divided than at any time since the euro crisis began, with Germany's Chancellor Angela Merkel showing no sign of relenting in her refusal to back other countries' debts. Merkel is being urged at home to hang tough and reject all efforts to make Germany underwrite European partners' borrowing or banks, while her European Union partners say that may be the only way to save the single currency. "Nein! No! Non!" shouted a headline splashed across the front page of the normally sober German business daily Handelsblatt, with a commentary by its editor-in-chief saying Merkel must remain firm at the two-day summit. Lenny Dykstra Takes Plea Deal On Fraud Charges (LAT) Former New York Mets star and self-styled financial guru Lenny Dykstra, already sentenced to three years in state prison for a car scam, has agreed to a plea deal on federal bankruptcy fraud charges after allegedly looting his mansion of valuables as he struggled to battle numerous creditors...According to federal prosecutors, Dykstra sold sports memorabilia and items from his Ventura County mansion, including a $50,000 sink, that were frozen as part of the bankruptcy case. Typically, a person in bankruptcy can't touch assets that are part of the case so that they are available to repay creditors. Dykstra allegedly had dozens of items, including chandeliers, mirrors, artwork, a stove and a grandfather clock delivered to a consignment store, Uniques, on South Barrington Avenue in West Los Angeles. The owner of the store paid him cash for a U-Haul truckload of goods, according to the agent. Manhattan philanthropist behind alleged madam's $250K bond post (NYP) Bonnie Lunt is the mystery hero who put up $250,000 collateral to spring the accused hockey mom madam from Rikers last night, court records show. The 65-year-old Lunt -- a top New York headhunter who has been dubbed the “Jerry Maguire of the communications industry”-- posted her own Upper East Side home to help Gristina make bail, according to bail documents. Lunt’s East 76th street pad is just around the corner from the tiny East 78th Street apartment prosecutors claim Gristina used as headquarters for an alleged multi-million dollar prostitution operation. Miami attacker who chewed man's face was not high on 'bath salts,' officials say (DJ) The Miami "cannibal" who chewed off half of another man's face last month had no drugs in his system other than marijuana, officials said Wednesday, defying suspicions that he was high on "bath salts" during the grisly attack. Rudy Eugene, 31, was shot and killed by police on May 26 after he was found naked and biting into a homeless man's face and eyes beside Miami's MacArthur Causeway. Authorities had suspected Eugene was under the influence of synthetic drugs sold as "bath salts," which have been known to make some users aggressive and behave bizarrely. Witnesses said he had taken off his clothes and was swinging on a light pole before the attack.

Opening Bell: 02.20.13

Regulator set to weigh lifetime futures-trading ban for Corzine (NYP) Two directors of the National Futures Association will move tomorrow to ban Corzine from the multibillion-dollar futures trading industry in light of the scandalous collapse of MF Global — the commodity futures brokerage firm Corzine once headed. If the motion is approved, NFA would hold hearings to determine whether Corzine, MF’s former CEO, deserves a “lifetime ban” from the industry...Corzine, who declined to comment on the proposed ban, is reportedly looking to set up a hedge fund. An NFA ban would limit his ability to trade futures in any fund with outside investors, experts said. It could also hinder his ability to raise money from pension funds and other large investors, experts said. Corzine could also be asked to fork over as much as $250,000 for each violation, according to NFA rules. The proposed ban cites nine rule violations, which could ding the disgraced Corzine for as much as $2.5 million. Rhetoric Turns Harsh As Budget Cuts Loom (WSJ) With less than two weeks to go before the latest fiscal face-off, rhetoric heated up Tuesday as the political parties exchanged fire over whom to blame if looming spending cuts take effect. With Congress in recess this week, Republican and Democratic leaders sent lawmakers home armed with fact sheets about the $85 billion in across-the-board federal spending cuts due to start March 1, and talking points on how to blame the other side. Meantime, the White House and lawmakers are making no progress toward forging a compromise to avoid the reductions, which are known in Washington as the sequester. Thousands of Greeks Rally in Anti-Austerity Strike (Reuters) Tens of thousands of Greeks took to the streets of Athens on Wednesday during a nationwide strike against wage cuts and high taxes that kept ferries stuck in ports, schools shut and hospitals with only emergency staff. Beating drums and chanting "Robbers, robbers!" more than 60,000 people marched to parliament in the biggest anti-austerity protest so far this year. The two biggest labour unions brought much of crisis-hit Greece to a standstill during the 24-hour protest against policies which they say deepen the hardship of people struggling through the country's worst peacetime downturn. Judge Says Einhorn Hedge Fund May Succeed in Apple Case (Reuters) David Einhorn's hedge fund has shown a "likelihood of success" if his legal attack against Apple goes forward, a U.S. judge said, though he made no immediate ruling on fund's request to block a shareholder vote on a proxy proposal next week. U.S. District Judge Richard Sullivan on Tuesday reserved decision on a lawsuit by the fund, Greenlight Capital, to stop a Feb. 27 shareholder vote on an Apple proposal to end the issuance of preferred stock without investor approval. "Candidly I do think the likelihood of success is in favor for Greenlight," Sullivan said at a court hearing in New York. Big Anglo-French Buyout Planned (FT) A British-based private equity consortium is preparing a bid of 3.5 billion euros for French catering company Elior in what would be the biggest buyout in continental Europe since Lehman Brothers collapsed in 2008. CVC Capital Partners and BC Partners have teamed up to launch a buyout of Elior, underlining how confidence is returning to Europe's private equity sector. New York mom charged with child endangerment after hiring strippers to perform lap dances at her 16-year-old son's birthday party (NYDN) Judy Viger, 33, hired the women from a company called Tops in Bottoms and arranged for them to perform in a private room at the Spare Time Bowling Center in South Glens Falls on Nov. 3. At the party, the women performed what police describe as “personal and intimate” dances with the party guests, some of whom were as young as 13. Approximately 80 people attended the party, including a 13-year-old and many adults who later said they were outraged at the sexually charged performances. Police were alerted to the party activities after raunchy photos of the lap dances were posted online. The mother of a 15-year-old boy who attended the party saw some of the photos on her son’s Facebook page and alerted South Glens Falls authorities...The company providing the strippers said that the dancers were unaware that the kids at the party were underage, local CBS affiliate WRGB reported, and that the incident was being “blown out of proportion.” Heinz Deal Feeds Chatter About Food-Industry Consolidation (WSJ) The deal sparked speculation of what Heinz may want to buy and what other food company has the wherewithal to become a consolidator. With the potential for more tie-ups, that may also jar loose some brands or businesses—possibly Heinz's underperforming frozen-foods business—that could make a nice fit in another company's pantry. The speculation makes just about everyone a buyer or a seller. "Most of what food companies discuss at the conference will now be taken in the context of what it may mean for further industry consolidation or portfolio change," Barclays packaged-food analyst Andrew Lazar said. Brink’s Says Brussels Diamond Robbery Will Hurt Quarter’s Profit (Bloomberg) Brink’s Co., a provider of armored cars to transport valuables, said a diamond robbery at Brussels airport will have a “significant impact” on first-quarter earnings. A portion of the gems stolen two days ago was being shipped by Brink’s, the Richmond, Virgina-based company said today in a statement. The Antwerp World Diamond Centre has said about $50 million of rough and polished diamonds were stolen as the gems were being loaded onto a plane bound for Switzerland. Revel Into Chapter 11 (AP) Revel, the casino many people had hoped would turn around Atlantic City’s sagging fortunes, said yesterday that it will file for Chapter 11 bankruptcy protection in March, less than a year after it opened. The voluntary, prepackaged bankruptcy envisioned for late March will wipe away about two-thirds of its $1.5 billion in debt by converting more than $1 billion of it into equity for lenders. JPMorgan Leads U.S. Banks Lending Least Deposits in 5 Years (Bloomberg) The biggest U.S. banks including JPMorgan Chase & Co. and Citigroup Inc. are lending the smallest portion of their deposits in five years as cash floods in from savers and a slow economy damps demand from borrowers. The average loan-to-deposit ratio for the top eight commercial banks fell to 84 percent in the fourth quarter from 87 percent a year earlier and 101 percent in 2007, according to data compiled by Credit Suisse Group AG. Lending as a proportion of deposits dropped at five of the banks and was unchanged at two, the data show. New Grey Poupon 'Pardon Me' ad to air during Oscars (AP) After a 16-year hiatus, the mustard that mocked its own stuffy image in one of TV’s most famous commercials will once again take to the airwaves during the Feb. 24 Academy Awards show. The spot comes as Kraft Foods looks to boost sagging sales of the Dijon mustard, which is facing competition from a growing variety of high-end condiments on supermarket shelves. The new ad begins in the same way as the original — an aristocratic English gentleman is being chauffeured in the countryside, when another car pulls up alongside them at a stop. The back window rolls down and a second man asks in an over-the-top snooty accent, “Pardon me, would you have any Grey Poupon?”

By Agnico-Eagle (Agnico-Eagle Mines Limited) [CC0], via Wikimedia Commons

Opening Bell: 7.6.16

Deutsche Bank sees 60% chance of US recession; Ashley Madison faces fembots probe; Blackrock says gold will go much higher; North Carolina couple arrested for assaulting each other with pizza rolls; and more.

Opening Bell: 02.27.13

Bernanke Affirms Bond Buying (WSJ) In his semiannual report to Congress Tuesday, Mr. Bernanke said the bond buying is helping the economy by holding down long-term interest rates and ought to be sustained. "Keeping long-term interest rates low has helped spark a recovery in the housing market and has led to increased sales and production of automobiles and other durable goods," he said. The Fed has accumulated $2.8 trillion of Treasury and mortgage securities. Mr. Bernanke's remarks signaled little change in the central bank's plans to purchase $85 billion a month of long-term Treasury and mortgage debt. The Fed's next policy meeting is March 19-20. Regulators Hope For Libor Pacts (WSJ) Regulators investigating alleged interest-rate manipulation are hoping to reach settlements with at least three major financial institutions by the end of summer, according to a person familiar with the probes. It isn't clear if the companies will go along with any proposed settlements, and previous agreements with banks were delayed before being completed. So far, regulators have settled rate-rigging charges with Barclays, RBS, and UBS collecting about $2.5 billion in penalties. All three banks admitted that employees sought to rig rates. Barclays to Unveil Numbers Earning 1 Million (FT) Barclays is set to reveal the number of staff who earned above 1 million pounds ($1.5 million) last year, in a push for transparency that could turn the bank into a trailblazer for the sector. In its annual report next week, the British retail and investment bank will for the first time give an outline of the various pay brackets among its 140,000 staff, people close to the situation said. Analysts estimate that between 600 and 700 employees – mostly in the investment bank – will be revealed as having taken home more than 1 million pounds last year. JPMorgan To Cut 17,000 Jobs (WSJ) The move announced Tuesday by the New York company, the nation's most profitable bank in 2012 and the biggest U.S. lender by assets, will reduce its staff by 6.5% in one of the most aggressive reductions to date amid widespread financial-industry cutbacks. Bond brawl: Singer v. Argentina today (NYP) Lawyers Ted Olsen and David Boies will appear before a Manhattan US appeals court to argue over how $1.44 billion in Argentina debt should be paid. Olsen represents billionaire hedge fund magnate Paul Singer, who claims he and other bondholder holdouts should be paid alongside those holders who agreed to a steep haircut during a debt restructuring. Argentina President Cristina Kirchner has long insisted she will never pay “one dollar” to the Singer holdouts. Boies represents the bondholders who agreed to the restructuring — and they oppose Singer, believing that Argentina will never go along with a pro-holdout ruling, thus putting their bonds at risk of default. Cops: Florida Man, 36, Assaulted Teen Relative With Taco Bell Burrito (TSG) The victim told cops that he was having a “verbal altercation” with his mother and Brown, his brother-in-law, when Brown “asked his mother to bring him the burrito,” according to an arrest affidavit. Brown then allegedly threw the burrito “with force” at the victim, striking the boy in the face with the fast food item. While interviewing the teen, cops noted that he had “burrito cheese, sauce and meat all over his clothing and face.” Brown told police that the victim was disrespectful to his mother and had cursed at the woman. He also acknowledged that he had “delivered” the burrito. After being booked into the county jail, Brown warned that he would “take care” of the teen upon his release from custody, adding that the victim “was going to get knocked out.” Best Buy Takeover Attempt by Founder in Jeopardy (Reuters) Best Buy founder Richard Schulze's effort to take the company private is in trouble after attempts to secure financing faltered while an alternative strategy to line up minority investors may not pan out either, five sources familiar with the matter said. No longer pursuing a full takeover bid for the troubled electronics retailer, Schulze has focused discussions in recent weeks on a potential deal in which private equity firms would buy a non-controlling stake, the sources, who declined to be named because the discussions are private, said. 'Penta-Millionaires' Happier Than Merely Rich: Study (CNBC) Breaking: A survey from Spectrem Group found that individuals worth $5 million or more are far more satisfied with their jobs, relationships and work than those worth $100,000 or less. Dimon Says Banks Have More Capital Than They Can Use (Bloomberg) The biggest U.S. banks are lending the smallest portion of their deposits in five years as cash floods in from savers, a slow economy damps demand from borrowers and regulators push financial firms to bolster themselves against any future credit crisis. The average loan-to-deposit ratio for the top eight commercial banks fell to 84 percent in the fourth quarter from 87 percent a year earlier and 101 percent in 2007, according to data compiled by Credit Suisse Group AG. JPMorgan had the lowest ratio in the group at 61 percent. “I don’t want to say it’s anti-American” to be held to international standards, Dimon said, adding that the bank’s assets include highly rated securities. “That balance sheet is almost as liquid as you can get.” Budweiser Has Been Sued 3 Times for Watering Down All Those Watery Beers (Atlantic Wire) The plaintiffs — including one guy who bought a case of Michelob Ultra a month, for some reason — allege that the public doesn't know what all the beers under the Budweiser umbrella really taste like, and that they're not getting their money's worth. There is no science backing up the defendants' claims, and AB InBev has yet to respond in court. The krux of the evidence comes from "information from former workers" of Anheuser-Busch breweries who claim watering down the beer in post-production is a company policy.

Opening Bell: 09.28.12

Bank Of America Reaches Settlement In Merrill Lynch Acquisition-Related Class Action Litigation (BW) Under terms of the proposed settlement, Bank of America would pay a total of $2.43 billion and institute certain corporate governance policies. Plaintiffs had alleged, among other claims, that Bank of America and certain of its officers made false or misleading statements about the financial health of Bank of America and Merrill Lynch. Bank of America denies the allegations and is entering into this settlement to eliminate the uncertainties, burden and expense of further protracted litigation. Greece Seeks Taxes From Wealthy With Cash Havens in London (NYT) At the request of the Athens government, the British financial authorities recently handed over a detailed list of about 400 Greek individuals who have bought and sold London properties since 2009. The list, closely guarded, has not been publicly disclosed. But Greek officials are examining it to determine whether the people named — who they say include prominent businessmen, bankers, shipping tycoons and professional athletes — have deceived the tax authorities by understating their wealth. Libor Riggers May Be Criminal, Even If Acts Not Illegal at Time (CNBC) Those who took part in the manipulation of the London interbank offered rate (Libor), the key benchmark rate, could face criminal prosecution even though Libor manipulation is not yet a criminal offense. Martin Wheatley, who is advising the U.K. government on what changes could be made to Libor to stop manipulation in the future, said that U.K. regulator the Financial Services Authority (FSA) is considering prosecuting those who took part under “broad principles of conduct.” He also recommended that the government should give the FSA power to prosecute future Libor manipulation. Libor Furor: Key Rate Gets New Scrutiny (WSJ) "There's a concern that if you're going to base financial decisions on a particular interest rate" it should be a measure that responds to changes in market conditions, "and that's not Libor," said Andrew Lo, a finance professor at the Massachusetts Institute of Technology. Macquarie Bonuses Whack Profit (WSJ) Macquarie Group may have lost its reputation as the Millionaire’s Factory as profits slumped since the onset of the global financial crisis, but according to Citigroup analysts the bank’s net profit could have been 60% higher last financial year if not for a dramatic rise in bonus payments to staff...Wes Nason estimates that while the bank’s return on equity fell to 6.8% last financial year-–hitting its lowest level since it listed in the first half of fiscal 2012 and compared with a 10-year average of 18.4%—-its average bonus payments almost tripled to A$73,000 a head, up from A$26,000 in 2009. Replacement referee Lance Easley stands by touchdown call (NYDN) Lance Easley has been vilified for awarding the Seattle Seahawks a touchdown on its Hail Mary pass in the closing seconds of Monday night’s game against the Green Bay Packers even though pretty much everyone in the country saw that the pass had been intercepted. “I processed everything properly,” Easley told the Daily News Thursday. “It was supported on video. But the bad thing is, people don’t understand the rules in that whole play. “But that play rarely ever happens, it rarely happens in the field of play and it never happens in an NFL game,” he added. “And here I got stuck in the middle of it.” The call was reviewed on instant replay — and, amazingly, upheld, despite the refs also missing a pass interference infraction by a Seattle player. Since then the 52-year-old Bank of America banker has been swept up in a whirlwind of national outrage — one that forced the NFL to end a seven-week lockout of its unionized refs early Thursday. But Easley said he and his replacements did a good job in their stint in zebra stripes. “I know where I stand,” he said. “Everything I did ... I got support from all the referees and everything, and replay and our league office and anybody else that understands the rules and how those plays function. Spanish Rescue May Throw Crisis Spotlight on Italy (Reuters) Italian government bonds risk being thrown back into the spotlight of the euro zone debt crisis once Spain decides to request aid and secures central bank support for its debt. A partial bailout for Madrid would probably trigger the European Central Bank's bond-buying plan, lowering Spain's borrowing costs and increasing investor appetite for riskier assets in general, including debt issued by Italy. But Italy could then return to the forefront of market concern as the next weak link. "The risks increase that you will get a contagion into Italy," said David Keeble, global head of fixed income strategy at Credit Agricole. Cyber Attacks On Banks Expose Computer Vulnerability (WSJ) Cyber attacks on the biggest U.S. banks, including JPMorgan Chase & Co. and Wells Fargo & Co., have breached some of the nation’s most advanced computer defenses and exposed the vulnerability of its infrastructure, said cybersecurity specialists tracking the assaults. The attack, which a U.S. official yesterday said was waged by a still-unidentified group outside the country, flooded bank websites with traffic, rendering them unavailable to consumers and disrupting transactions for hours at a time. Such a sustained network attack ranks among the worst-case scenarios envisioned by the National Security Agency, according to the U.S. official, who asked not to be identified because he isn’t authorized to speak publicly. The extent of the damage may not be known for weeks or months, said the official, who has access to classified information. Fitch Ratings Cuts China, India 2012 Growth Forecasts (CNBC) In its September Global Economic Outlook, the ratings agency said it now expected China’s economy, the world’s second largest, to grow 7.8 percent this year, down from a forecast of 8 percent made in June. It also lowered its forecast for economic growth in India to 6 percent in the financial year ending in March 2013 from a previous estimate of 6.5 percent. CIT Chief Tries To Rescue Reputation (NYP) John Thain yesterday said he brought up executive compensation at the time his firm was getting bailed out by taxpayers not for selfish reasons but to determine how much control Washington would have over his company. “One of the issues we were worried about at the time was, if you take government money how much say does the government have in how you run your business?” Thain said during an interview on CNBC. Days earlier, Thain was trashed by former bank regulator Sheila Bair, who, in her upcoming book, “Bull By the Horns,” accuses the Wall Street veteran of being fixated on pay during the height of the financial Armageddon. Bair, the former Federal Deposit Insurance Corp. boss, wrote that Thain “was desperate for capital but was worried about restrictions on executive compensation.” “I could not believe it. Where were this guy’s priorities?” she wrote, referring to Thain. The CEO, who was tapped to run the troubled lender in 2010, also addressed during the CNBC interview rumors that CIT was looking to sell itself to a large bank. “It’s absolutely not true,” Thain said yesterday. Canada Cheese-Smuggling Ring Busted (BBC) A Canadian police officer was among three people charged as the country's authorities announced they had busted a major cheese-smuggling ring. A joint US-Canadian investigation found C$200,000 (£125,600) of cheese and other products were illicitly brought over the border into southern Ontario. The smugglers sold large quantities of cheese, which is cheaper in the US, to restaurants, it is alleged. The other two men charged were civilians, one a former police officer. The charges come three days after CBC News first reported the force was conducting an internal investigation into cheese smuggling. A pizzeria owner west of Niagara Falls told CBC that he had been questioned by police over the issue, but assured them he had not bought any contraband dairy. "We get all our stuff legit," said the restaurateur. "We thought it was a joke at first. Who is going to go around trying to sell smuggled cheese?"

Opening Bell: 12.05.12

Global Banking Under Siege as Nations Tighten Local Rules (Bloomberg) Regulators want to curtail risks exposed after global banks such as New York-based Citigroup, Edinburgh-based Royal Bank of Scotland and Zurich-based UBS took bailouts in the biggest financial crisis since the Great Depression. Forcing lenders to dedicate capital and liquidity to multiple local subsidiaries, rather than a single parent, may undermine the business logic of a multinational structure. “Being big and spread out all over the world isn’t what it used to be,” said Mayra Rodriguez Valladares, managing principal at New York-based MRV Associates, which trains bank examiners and executives at financial firms. “You’ll see global banks jettison divisions abroad and at home.” Paulson Said to Blame Bet Against Europe for Most of Loss (Bloomberg) John Paulson, manager of $20 billion in hedge funds, told investors that the bulk of his losses this year came on bets that the European sovereign-debt crisis would worsen, according to a person familiar with the matter. Paulson, speaking to clients at his firm’s annual meeting yesterday in New York, said he has reduced those positions following European Central Bank President Mario Draghi’s comments in July that the ECB was committed to preserving the euro, said the person, who asked not to be identified because the meeting was private. Paulson said in a February letter to investors that the euro was “structurally flawed” and would eventually fall apart. In April, the founder of New York-based Paulson & Co. told clients he was wagering against European sovereign bonds and buying credit-default swaps on European debt, or protection against the chance of default. No Payback For Singer This Year (NYP) Paul Singer’s last-ditch attempt to get cash from Argentina this year has failed. A motion by Singer’s hedge fund, Elliott Management, requesting that the South American country put up a security deposit of $250 million by Dec. 10 was denied by a federal appeals court yesterday. “Since we will not have a big payment for ages (if ever), this looks like a huge blow to [Elliott’s] strategy,” said sovereign-debt expert Anna Gelpern. In Tax Fight, G.O.P. Seeks a Position to Fall Back On (NYT) Senator Olympia J. Snowe of Maine, who is retiring, joined a handful of other Republicans on Tuesday suggesting that Congress should pass the middle-class tax cut extensions now, then leave the fight over taxes and spending until later. Americans, she said, "should not even be questioning that we will ultimately raise taxes on low- to middle-income people." Congress could take that off the table "while you're grappling with tax cuts for the wealthy," she said. But any move toward compromise with Democrats on fiscal issues quickly comes under attack from conservatives as a surrender and unsettles the rank-and-file. It is a dynamic that has haunted Speaker John A. Boehner throughout the 112th Congress, as he has repeatedly been caught between the imperative to govern and the need to satisfy the restive right. Mr. Boehner, of Ohio, has drawn fire this week for removing a handful of House Republicans who have defied the leadership from their preferred committee seats, a step he took to enforce party discipline. Fed to launch fresh bond buying to help economy (Reuters) The Federal Reserve is set to announce a fresh round of Treasury bond purchases when it meets next week, avoiding monetary policy tightening to maintain support for the weak U.S. economy amid uncertainty over the looming year-end "fiscal cliff." Many economists think the U.S. central bank will announce monthly bond purchases of $45 billion after its policy gathering on December 11-12, signaling it will continue to pump money into the U.S. economy during 2013 in a bid to bring down unemployment. Merkel Wins Party Reelection, Eyes Third Term (Reuters) Merkel, at the height of her popularity, was returned unopposed as CDU chairwoman with 97.9 percent of votes from delegates who stood and applauded her for nearly eight minutes after she lauded Germany's economic resilience in the euro crisis and promised to fight for jobs and prosperity. McAfee Emerges From Hiding in Guatemala (FT) John McAfee, the antivirus software entrepreneur, has revealed that he has fled to Guatemala from Belize where he is wanted for questioning in relation to a murder. Posting on his website on Tuesday, the US citizen and multimillionaire said: "I apologize for all of the misdirections over the past few days . . . I am in Guatemala." His emergence closes one chapter in a bizarre chain of events that started last month when police in Belize, where Mr McAfee has lived for the past four years, discovered the dead body of Gregory Faull, the owner of a house close to Mr McAfee's main property on the island of Ambergris Caye. Mr McAfee - who Belize considers "a person of interest" in the murder investigation - fled, going into hiding and insisting on his innocence. He said he ran from the police because he believed that the Belize authorities were out to kill him. In response, Dean Barrow, the prime minister, said: "I don't want to be unkind to the gentleman, but I believe he is extremely paranoid". Mr McAfee revealed his location on Tuesday after a hacker called Simple Nomad disclosed his whereabouts by analyzing a mobile-phone photograph taken of McAfee on Monday that was posted on the internet. In a second blog post late Tuesday titled "the new fight", Mr McAfee said he had asked Telsforo Guerra, a former attorney-general of Guatemala, to help uncover what he claims is deep-rooted corruption in Belize. Separately, he told Reuters that Mr Guerra was trying to help him obtain political asylum in Guatemala, even though Belizean authorities have not charged him. EU Banks To Repay Cheap Loans (WSJ) Nearly a year ago, hundreds of European banks borrowed a total of more than €1 trillion ($1.3 trillion) from the European Central Bank as it scrambled to defuse an escalating crisis. Today, in a sign of the industry's partial healing, some of Europe's biggest banks are preparing to repay those loans. The push to repay the loans, however, has generated concerns that banks are moving prematurely and could be vulnerable if the euro-zone crisis intensifies again. The ECB activated the emergency loan program—known as the long-term refinancing operation, or LTRO—late last year, doling out two batches of inexpensive loans that are good for three years. Banks are permitted to repay them starting next month. Euro Crisis Feeds Corruption as Greece Slides in Rankings (Bloomberg) The European debt crisis has given way to a new wave of corruption as some of the most hard-hit countries in the turmoil have tumbled in an annual graft ranking, watchdog group Transparency International said. Greece, in its fifth year of recession and crippled by rounds of austerity, fell to 94th place from 80th -- ranking it below Colombia and Liberia, according to the group’s Corruption Perceptions Index. Ireland, Austria, Malta and Italy were also among member states in the single currency to slide. Moynihan: No Stress (Bloomberg) Bank of America CEO Brian T. Moynihan said the firm has plenty of capital and he’s confident it will pass the next US stress tests. “The question will be what to ask for and when, because we’re not going to fail this,” Moynihan said yesterday at a New York investor conference sponsored by Goldman Sachs. Moynihan, 53, is renewing efforts to win approval to raise the company’s dividend or repurchase shares after the Federal Reserve blocked an earlier request. Fed Filcher Gets Timeout (NYP) Bo Zhang, a Chinese-citizen computer programmer who worked for a contractor at the New York Fed, was sentenced to six months of home confinement for stealing Treasury Department software. Snake on a plane forces emergency landing (CNN) ...the incident forced the pilot to make an emergency landing in the Egyptian resort town of Al Ghardaqa on the Red Sea, according to The Jordan Times. An Egypt Air official told the paper an investigation revealed that a 48-year-old passenger, who owns a reptile shop in Kuwait, had hidden the Egyptian cobra in a carry-on bag. The passenger was trying to control the snake after it bit his hand and started slithering under the seats. The Egyptian daily al-Masry al-Youm reported that the man refused medical treatment, claiming his wound was only superficial. The plane resumed its flight to Kuwait after local authorities confiscated the snake. Doctors told the passenger he should spend 24 hours in a hospital for observation, but the man refused, the Egyptian Air official said, according to The Jordan Times.