Opening Bell: 11.7.16

Wall Street bonuses set to sink again; trading profits are mysteriously on the mend; Ted Nugent went TMI on his anatomy; and much more.
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European Stocks Are Going Wild After The FBI Cleared Clinton (BI)

Trump.BurningMoney

Stocks across Europe are charging on Monday after the latest investigations into US presidential candidate Hillary Clinton's private email servers found nothing new. FBI Director James Comey informed Congress on Sunday that a review of new emails found in relation to the bureau's investigation into Clinton's use of a private email server had not yielded any reason for charges against the Democratic presidential nominee.

Wall Street Bonuses Are Expected to Sink for 3rd Straight Year (NYT)

Bonuses are expected to decline for the third consecutive year, reflecting a period of busted mergers, limited trading activity and muted hedge fund returns. The payouts are projected to be from 5 to 10 percent lower this year, according to an annual report to be released on Monday by Johnson Associates, a compensation consulting firm. Bonuses fell about the same amount last year from 2014. The projection confirms a report last month by the New York State comptroller that said firms set aside 7 percent less for bonuses through the first half of this year compared with last year.

Did Wall Street Banks Suddenly Turn Into Better Traders? (WSJ)

Now that major overseas banks have reported, it is clear that the trading rebound—such as it is, with just two consecutive quarters of strong results—is occurring across the board. Trading revenue earned by the nine largest global firms rose 19% in the third quarter from a year earlier, according to data compiled by UBS Group AG. Of that group, the average U.S. bank’s revenue rose 28%, while the average European firm’s was up 14%.

Ted Nugent Grabs Himself Onstage At Trump Rally In Michigan: 'I've Got Your Blue State Right Here' (BI)

Ted Nugent made an obscene gesture onstage Sunday while warming up a crowd in Michigan for Donald Trump. “I’ve got your blue state right here,” Nugent said as he grabbed his crotch. “Black and blue.” The vulgar visual display came while the outspoken rocker insisted the “real Michigan” was a conservative state and should not be a member of the Democratic electoral firewall.

Banks Passed Up Uber Share Sale on Lack of Data (BBG)

The potential fees and reputation boost that could come from working on Uber Technologies Inc.’s initial public offering are the stuff of bankers’ dreams. Yet at least two investment banks passed on selling shares of Uber to their high-net worth clients -- shares eventually sold by other banks in January -- because the ride-share company wasn’t willing to provide financial details about its business, people with knowledge of the matter said.

China Weighs Giving Wall Street Investment Banks Greater Mainland Access (WSJ)

Beijing is considering allowing Wall Street firms to run their own investment-banking businesses on the mainland, according to people briefed on the discussions, a long-awaited step that would give them more access to China’s hard-to-crack domestic market. The move is being discussed as part of a new U.S.-China trade and investment framework.

What Investors Misunderstand About The Politics Of Rage (FT)

Perhaps surprising to some, we find that the fall began in the early 2000s — before the global financial crisis. It also is unprecedented: we can find no similar widespread drop in support for the political centre in the last century. Even during the Great Depression years the centre vote share rose in most countries with a history of democracy. More important for markets, the roots of the Politics of Rage appear misunderstood. Subject to many caveats, we find evidence that falling support for the political centre is related to stagnant median incomes, and that trade and immigration may have played a role in leaving behind middle earners in advanced economies.

The Election Ate Their Homework? CEOs Blame Campaign For Weakness (Reuters)

Apparently, Americans are too distracted or distraught by this year's wild presidential campaign to think about getting a dishwasher, buying an RV or opening a doughnut shop. And the topsy-turvy race could be crimping furniture sales, hotel bookings and even temporary help hiring.

[Counterpoint] Fewer S&P 500 Companies Mentioning Election in 2016 vs 2012 (FactSet)

It is interesting to note that the total number of S&P 500 companies that have mentioned “election” in 2016 (80) is 20% below the number recorded over this same time frame in 2012 (100). Fewer S&P 500 companies have discussed the election in 2016 relative to 2012 over the same time frame.

Pumpkin Launching Machine Explodes, Critically Injuring Woman At Punkin Chunkin Competition In Delaware (NYDN)

BRIDGEVILLE, Del. — A person was critically injured after an apparatus used to launch pumpkins into the air exploded.

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Trump.Paulson

Opening Bell: 11.4.16

Pensions spring for sex shops and sewage; election triggers Wall Street bros; Paulson's hedge fund reeling on pharma bets; RedtTube's election prediction; and more.

Opening Bell: 11.9.15

Wall Street braces for bonus cuts; Central banker says fed hike makes sense; "Rumblr, the 'Tinder for Fighting' app, to launch its beta trial on Nov. 9"; and more.

Opening Bell: 12.10.12

U.S. authorities probe SAC for Weight Watchers (Reuters) U.S. authorities are investigating Steven A. Cohen's SAC Capital Advisors hedge fund for possible insider trading in the shares of the popular diet company Weight Watchers International Inc, according to people familiar with the matter. The investigation focuses on trading in Weight Watchers shares in the first half of 2011, when SAC Capital had taken a sizeable position in the stock, and potentially could implicate the billionaire hedge fund manager, the sources said on Friday. Regulatory filings show that Cohen's $14 billion fund briefly held 2.1 million shares in Weight Watchers during the period under scrutiny by authorities - at which time the diet company's stock price roughly doubled. The inquiry is in its early stages and it is not clear whether anything improper was done either by SAC Capital or Cohen himself, said the people familiar with the matter, who requested anonymity. The trading in Weight Watchers would be permissible as long as it was based on fundamental research or derived from individuals who did not have access to non-public corporate information. Big Money Bets On Housing Rebound (NYT) A flurry of private-equity giants and hedge funds have spent billions of dollars to buy thousands of foreclosed single-family homes. They are purchasing them on the cheap through bank auctions, multiple listing services, short sales and bulk purchases from local investors in need of cash, with plans to fix up the properties, rent them out and watch their values soar as the industry rebounds. They have raised as much as $8 billion to invest, according to Jade Rahmani, an analyst at Keefe Bruyette & Woods. The Blackstone Group, the New York private-equity firm run by Stephen A. Schwarzman, has spent more than $1 billion to buy 6,500 single-family homes so far this year. The Colony Capital Group, headed by the Los Angeles billionaire Thomas J. Barrack Jr., has bought 4,000. Wall Street workers expecting worst bonus season since 2008 (NYP) State Comptroller Thomas DiNapoli estimates that the average bonus this year will be $101,000 — a 16.5 percent decline from last year and almost a 50 percent decline since 2006, when the average was $191,360. ‘‘I don’t think this year’s bonuses are going to be very good,’’ said Dan Shaffer, CEO of Shaffer Asset Management. ‘‘I don’t believe the typical bonuses, as we used to know them, exist anymore.’’ Obama Meets with Boehner Privately at White House (Bloomberg) The meeting was the first known face-to-face conversation between the two leaders since Nov. 16, when Boehner and other congressional leaders sat down with Obama at the White House. They have talked on the telephone since then. Obama met with Nancy Pelosi, the House Democratic minority leader, on Dec. 7. Investors offer about $38.8 billion in Greek debt buyback (Reuters) Greece is set to purchase back about half of its debt owned by private investors, broadly succeeding in a bond buyback that is key to the country's international bailout, a Greek government official said on Saturday. Hefner Husband Takes Insider Trading Into Playboy Bedroom (Bloomberg) Christie Hefner, [daughter of Hugh and] former chief executive officer of Playboy Enterprises Inc., said she was shocked as her husband of 15 years, William Marovitz, confessed to her that he was being investigated for suspicious trading in Playboy shares. They were in their apartment atop a 42-story Lincoln Park tower overlooking the glittering Chicago skyline and Lake Michigan on a March evening in 2010. “He told me he had been contacted by the SEC,” Hefner said later in testimony before the U.S. Securities and Exchange Commission, which didn’t accuse her of any wrongdoing. “And when did you learn your husband owned shares of Playboy?” she was asked. “In that conversation,” she replied. Hefner's husband is just one of more than 400 persons the SEC and the U.S. Department of Justice have accused of insider trading in a crackdown in the last five years, according to data compiled by Bloomberg. All involved betrayal -- of clients, employers, relatives or friends. The Hefner episode and a handful of cases like it include an especially cruel breach of trust: betrayal of a wife by a husband. Tennis star Novak buys up world's supply of donkey cheese at £400 a pound for new restaurant chain (DM) The cheese, known as pule, will be one of the key attractions at a chain of restaurants the Wimbledon champion and world number one is opening in his Serbian homeland...The Zasavica farm, which lies 50 miles west of the Serbian capital Belgrade, boasts a herd of 130 and is said to be the only place in the world where donkeys are milked for cheese. Banking Industry Squirms Over European Rate Probe (WSJ) The scandal over banks' attempted manipulation of interest rates has mostly centered on the London interbank offered rate. But Libor's lesser known cousin, the euro interbank offered rate, or Euribor, is facing mounting attacks. The European Union is expected soon to accuse multiple banks of attempted collusion in the setting of Euribor, according to people briefed on the probe. Barclays has already acknowledged trying to rig the rate, and other banks are likely to be pressed by regulators in the U.S., U.K. and elsewhere into similar admissions, according to industry and regulatory officials. Mortgage Crisis Presents a New Reckoning to Banks (NYT) Regulators, prosecutors, investors and insurers have filed dozens of new claims against Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and others, related to more than $1 trillion worth of securities backed by residential mortgages. Estimates of potential costs from these cases vary widely, but some in the banking industry fear they could reach $300 billion if the institutions lose all of the litigation. Depending on the final price tag, the costs could lower profits and slow the economic recovery by weakening the banks’ ability to lend just as the housing market is showing signs of life. Crisis Measure Nears End (WSJ) Barring action by Congress, the FDIC on Dec. 31 will stop providing an unlimited guarantee on zero-interest bank accounts used by businesses and municipalities for payroll and other services. The guarantee would then revert to the normal $250,000 in insurance per depositor at any given bank. If the guarantee isn't extended, FBR Capital Markets estimates as much as $250 billion in deposits could flow out of smaller banks to large banks or big money-market mutual funds. Stylish primate charms Toronto shoppers (The Star) A North York Ikea store attracted an unusual customer Sunday afternoon, when a tiny monkey dressed in a fitted faux shearling coat and diapers appeared in the store’s upper parking garage around 2 p.m. “It was just running around screaming,” said shopper Bronwyn Page...“It was really cute,” said Lisa Lin, another shopper. “It was smaller than a cat.” But if the monkey had hoped to stock up on Billy bookcases or Swedish meatballs, its plans were thwarted. The diminutive shopper never made it into the store, said manager Alvaro Carmona. No one was hurt in the incident, which lasted no more than half an hour, he added. Animal Services identified the monkey as a rhesus macaque, an Asian species that is prohibited in Ontario. The monkeys are known for their ability to live in diverse habitats – although Canadian winters obviously require a warm coat. The owner of the primate turned himself in to Animal Services just after 5 p.m. He was charged with owning a prohibited animal, an offence that carries a $200 fine. The seven-month-old monkey has somehow managed to escape his owner’s car in the Ikea parking lot, said animal control officer David Behan.

Opening Bell: 02.28.13

EU Bonus Rules Meet Anger (WSJ) The new rules would prevent banks from promising bonuses that exceed an employee's salary—though, with shareholder approval, bonus payments could rise to double the salary. The rules, which are supposed to kick in at the beginning of next year and appear to be the world's toughest, still need to be approved by EU member states and the full European Parliament. European banking executives and trade groups say the rules—which are likely to apply to all European bank's employees around the world—will put the industry at a severe disadvantage relative to U.S. and Asian banks, and that it will provoke unintended consequences. Banks early Thursday weren't yet publicly commenting as they digested the news. But executives privately didn't hold back. "It's a disaster," said a senior investment-banking executive at a top European bank. "It's a crazy policy" that could jeopardize European banks' abilities to hire employees in the U.S. or Asia. Jockeying Stalls Deal On Spending Cuts (WSJ) With mandatory across-the-board spending cuts set to begin Friday, the White House and congressional Republicans are poised to let the deadline pass, each calculating that their hand in negotiations only grows stronger if they scorn a quick compromise. The first face-to-face meeting on the issue between President Barack Obama and congressional leaders won't happen until Friday—the deadline for Mr. Obama to set in motion $85 billion in broad spending cuts. None of the participants expect the morning meeting at the White House to produce a breakthrough. In the run-up, with no serious talks under way, each side is maneuvering to ensure the other catches the blame if the cuts kick in. Cuts Unlike To Deliver Promised US Budget Savings (Reuters) The $85 billion cut to budget authority amounts to about 2.4 percent of the $3.6 trillion the U.S. government is expected to spend in the fiscal year that ends on Sept. 30. The actual amount of savings is much less - $43 billion in the current fiscal year, according to the Congressional Budget Office. That's because federal agencies don't spend all of the money they are allocated in any given fiscal year. A $1 billion aircraft carrier, for example, may take years to build. Even at that lower level, the effects are likely to ripple across the world's largest economy in a way that will work against deficit-reduction efforts. Scrutiny Of Heinz Trades Grows (WSJ) The Financial Industry Regulatory Authority, a Wall Street self-regulator, and the Federal Bureau of Investigation are reviewing numerous trades in Heinz stock shortly before the buyout announcement sent the share price soaring Feb. 14, the people said. The inquiries add to an investigation the Securities and Exchange Commission disclosed Feb. 15 into what it called a "highly suspicious" $90,000 purchase of stock options the day before the deal, a position with a potential profit of $1.7 million. The FBI also has said it launched a criminal investigation into options activity ahead of the deal. Flowers Foods Set To Buy Wonderbread From Hostess (NYP) After no other bidders emerged to challenge it, Flowers Foods is set to snare Wonder and a slew of other bread brands being sold by bankrupt Hostess Brands for $360 million. How The Pope's Retirement Package Compares To Yours (CNBC) Let's start with the basics: The pope emeritus will receive a monthly pension of 2,500 euros, according to Italian newspaper La Stampa. That translates to almost $3,300, or close to the monthly maximum of $3,350 that Social Security will pay to an American who retires this year. Few people will actually qualify for that amount. For starters, you would have to wait until 70 to retire. You would also have to spend most of your working life earning Social Security's taxable maximum pay, which is set at $113,700 this year. "That's quite rare," said Richard Johnson, director of the program on retirement policy at the Urban Institute. He pointed out that the average Social Security check is about $1,200 a month — not enough to pay for the typical American retiree's expenses. "For most people, if you look at the median, Social Security counts for about 40 percent of their income. So it's important, but people rely a lot on other savings, like pensions or 401(k) savings," Johnson said. A big nest egg is not something the pope emeritus has to worry about. The Roman Catholic Church will cover his living expenses, provide him with a spacious home inside the Vatican and pay for everything from cooked meals to housekeepers, according to The Telegraph. Such services are not available to the typical American senior, unless he or she pays for an assisted living facility or resides in a nursing home, Johnson said...Health care costs are one of the big risks that older Americans face, and while Medicare pays for the bulk of their expenses, many things are left uncovered, Johnson said. Meanwhile, the pope emeritus will continue to be a member of the Vatican's generous private health care policy, the BBC reported. Blackstone Profits From Regulation With Citigroup Deal (Bloomberg) Blackstone has devised a way to profit from regulation: It’s helping banks meet tougher capital rules without the pain of selling assets or raising equity. The firm last year insured Citigroup against any initial losses on a $1.2 billion pool of shipping loans, said two people with knowledge of the transaction, who asked not to be identified because the matter is private. The regulatory capital trade, Blackstone’s first, will let Citigroup cut how much it setsaside to cover defaults by as much as 96 percent, while keeping the loans on its balance sheet, the people said. RBS Moves To Appease UK (WSJ) The 81%-state-owned bank unveiled a series of moves to ease government and regulatory pressure on the bank to become more U.K. focused and better capitalized. Chief Executive Stephen Hester confirmed that it would list around 25% of the U.S.-based RBS Citizens bank in the next two years "to highlight the valuable nature of the business." RBS also said it would further pare back its investment bank, shedding jobs and cutting risk-weighted assets to £80 billion ($121.3 billion), from £101.3 billion at the end of 2012. Unemployment aid claims fall by 22,000 last week (AP) The number of Americans seeking unemployment aid fell 22,000 last week to a seasonally adjusted 344,000, evidence that the job market may be picking up. The four-week average of applications dropped 6,750 to 355,000, the Labor Department said Thursday. That was the first drop in three weeks. Too Big To Fail Hurting Too Small To Compete Banks (Bloomberg) Investors such as Joshua Siegel, founder and managing principal at New York-based StoneCastle Partners LLC, see bigger changes at the other end of the spectrum. Small banks will seek mergers because their management teams are aging and new regulations are too costly to bear, he says. “If you need one major overriding theme of the industry in the next three, five, seven, 10 years: massive consolidation, thousands of banks,” says Siegel, whose firm managed $5.1 billion as of the end of last year and invests in small banks. In the U.S., “I do see probably anywhere from 2,000 to 4,000 banks being swallowed up, and what you’ll see then is a more- concentrated system.” Dennis Rodman Tells Kim Jong Un: You Have A Friend For Life (NYP) Rodman and Kim sat side by side at an exhibition game in Pyongyang on Thursday, chatting as they watched players from North Korea and the US play in mixed teams, Alex Detrick, a spokesman for the New York-based VICE media company, told The Associated Press. Rodman later addressed Kim before a crowd of thousands, telling him, "You have a friend for life," Detrick said. The encounter makes Rodman the most high-profile American to meet with the young North Korean leader, said to be a diehard basketball fan.

Opening Bell: 03.06.12

Goldman Secret Greece Loan Reveals Sinners (Bloomberg) On the day the 2001 deal was struck, the government owed the bank about 600 million euros ($793 million) more than the 2.8 billion euros it borrowed, said Spyros Papanicolaou, who took over the country’s debt-management agency in 2005. By then, the price of the transaction, a derivative that disguised the loan and that Goldman Sachs persuaded Greece not to test with competitors, had almost doubled to 5.1 billion euros, he said. Papanicolaou and his predecessor, Christoforos Sardelis, revealing details for the first time of a contract that helped Greece mask its growing sovereign debt to meet European Union requirements, said the country didn’t understand what it was buying and was ill-equipped to judge the risks or costs...“Like the municipalities, Greece is just another example of a poorly governed client that got taken apart,” Satyajit Das, a risk consultant and author of “Extreme Money: Masters of the Universe and the Cult of Risk,” said in a phone interview. “These trades are structured not to be unwound, and Goldman is ruthless about ensuring that its interests aren’t compromised -- it’s part of the DNA of that organization. Greece Pushes For Aid Tranche (WSJ) Greece's international creditors are considering whether to grant the country a small, tranche of the €130 billion ($171.8 billion) bailout agreed earlier this month in the weeks ahead as part of efforts to pump liquidity into the country's moribund economy. Speaking to the privately owned Mega television channel Tuesday, Deputy Finance Minister Philippos Sachinidis said the money would go to paying off some of the €6 billion in accumulated arrears that the Greek government owes private contractors. He added that the disbursement could come before Greece goes to elections that are widely expected to be held in late April. "There is a discussion that, likely before the elections, we will get a tranche that will allow us to pay some of, not the total, of the arrears," Mr. Sachinidis said. Bondholder Group Sees 1 Trillion Euro Greek Default Risk (Reuters) A disorderly Greek default would probably leave Italy and Spain needing outside help to stop contagion spreading and cause more than 1 trillion euros ($1.3 trillion) of damage to the euro zone, the group representing Athens' bondholders warned. Greek private creditors have until Thursday night to say whether they will take part in a bond swap that is part of a 130 billion euros bailout deal to put the country on a more stable footing and cut its debt by more than 100 billion euros. Paulson’s Advantage Plus Declines in February (Bloomberg) John Paulson lost 1.5 percent in February in one of his largest hedge funds, according to an investor update, paring this year’s gain and setting back efforts by the New York-based manager to recoup record losses in 2011. Paulson’s Advantage Plus Fund, which seeks to profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns, gained 3.5 percent in the first two months of 2012, according to the update IBM’s Watson Gets Wall Street Job After ‘Jeopardy’ Win (Bloomberg) International Business Machines Corp’s Watson computer, which beat champions of the quiz show “Jeopardy!” a year ago, will soon be advising Wall Street on risks, portfolios and clients. Citigroup, the third-largest U.S. lender, is Watson’s first financial services client, IBM said yesterday. It will help analyze customer needs and process financial, economic and client data to advance and personalize digital banking. Ann Romney: ‘I Don’t Even Consider Myself Wealthy’ (ABC) Mitt Romney may have more money than any other presidential candidate in the race, but his wife said today that she does not consider herself wealthy. “We can be poor in spirit, and I don’t even consider myself wealthy, which is an interesting thing,” Ann Romney said in an interview on Fox News. “It can be here today and gone tomorrow.” Swiss Pass Proposal to Help Nab US Tax Evaders (Reuters) Specifically, the plan would allow Switzerland to hand over data on suspected tax evaders, even if U.S. tax authorities cannot identify alleged offenders by name or bank account. The big-spending businessman who ran up £203,948 bar bill was 23-year-old City whizkid (Mirror) The businessman who blew £203,948 on bubbly in a single night in Liverpool was 23-year-old Alex Hope...His biography reads: “Despite his tender years, Alex is a name to watch out for in the city. An expert in the UK economy, he works the currency markets, regularly trading millions.” Describing his rapid career rise from humble beginnings to working for trading company Zone Invest Group, it adds: “A talented, charismatic and thoroughly likeable man, Alex Hope exudes knowledge and you can’t help but respect and admire this self-taught and self-made young trader.” Banker Bonus Limits Sought by EU Lawmakers (Bloomberg) Members of the European Parliament’s Socialist and Green parties have proposed that a draft EU law to bolster bank capital should include new pay rules, as well as stricter curbs on risk taking, according to two members of the institution’s financial affairs committee. “Wrong incentives were part of the banking culture that caused the crisis,” said Udo Bullmann, a German lawmaker following the proposed law for the parliament’s Socialist group. “I expect there will be quite a lot of sympathy among different party groups” for further rules on pay. Judge throws heat at Picard’s claim vs. Mets (NYP) Picard’s best evidence may be from Noreen Harrington, a former chief investment officer for a hedge fund partially owned by the Mets’ owners, who is expected to say that she told Katz and another Sterling Equities executive that she thought Madoff’s reported returns were “fiction” and not “worth the paper they’re written on.” The Mets will argue they were bamboozled by Madoff, along with the nation’s top regulators and major banks. Bill Clinton Said to Agree to Join Obama at Campaign Fundraisers (Bloomberg) While Obama raised $5 million on his last fundraising trip to New York, including $2 million from a March 1 event with members of the financial services industry, he is collecting less money from Wall Street this year compared with four years ago, according to the Center for Responsive Politics. When Gaming Is Good For You (WSJ) People who played action-based video and computer games made decisions 25% faster than others without sacrificing accuracy, according to a study. Indeed, the most adept gamers can make choices and act on them up to six times a second—four times faster than most people, other researchers found. Moreover, practiced game players can pay attention to more than six things at once without getting confused, compared with the four that someone can normally keep in mind, said University of Rochester researchers. The studies were conducted independently of the companies that sell video and computer games.

Opening Bell: 01.15.13

Westminster Hits At Goldman Sachs Bonus Plan (FT) Goldman Sachs provoked a furious reaction in Westminster after it emerged that the U.S. investment bank was mulling a plan to delay its U.K. bonus payments to take advantage of the imminent cut to the top rate of tax. John Mann, a Labour member of the Treasury select committee, criticized an "opportunistic money grab" by banks at a time of intensifying public anger against the sector. Some 10 banks had previously considered delaying bonuses until the top rate falls from 50 to 45 pence - although most have since concluded that this would be damaging. Chris Leslie, shadow Treasury minister, said banks needed to think carefully about their reputations. Fitch Warns Of US Downgrade Over Debt Fight (CNBC) In a statement Fitch said the debt ceiling was "an ineffective and potentially dangerous mechanism for enforcing fiscal discipline. It does not prevent tax and spending decisions that will incur debt issuance in excess of the ceiling while the sanction of not raising the ceilingrisks a sovereign default and renders such a threat incredible." Fitch Upbeat On Ireland (Reuters) If [Ireland's] debts could be shared out among euro zone states through the region's bailout mechanisms there could be scope for Ireland's BBB-plus rating to rise into the single-A category, according to Fitch analyst Douglas Renwick. "If there is an element of risk sharing, say perhaps through the ESM (European Stability Mechanism) over a bit of time, it could rise back to the single-A (range)," Renwick said. JPMorgan Ordered To Fix Lapses (WSJ) US regulators hit JPMorgan with four formal enforcement actions targeting lapses in risk-management and money-laundering controls, including the first sanctions in response to the bank's multibillion-dollar 2012 trading debacle. One set of cease-and-desist orders from the Office of the Comptroller of the Currency and the Federal Reserve instructs the largest U.S. bank by assets to remedy the breakdowns that allowed a small group of London-based traders to rack up more than $6 billion in losses last year. Another requires the bank to beef up its antimoney-laundering procedures and mirrors an action taken last April when regulators ordered Citigroup to upgrade its transaction-monitoring procedures and enhance internal audit. None of the orders issued Monday require any fines or monetary penalties, but regulators left the door open to future action. Wells Fargo Bets On Charlotte Trading After BofA Flees (Bloomberg) \Wells Fargo is betting its securities business can thrive 600 miles from New York in the same city Bank of America's traders largely abandoned. The first of 900 Wells Fargo employees moved last month into a new space on two floors of a 48-story tower in Charlotte, North Carolina. From their windows they can see the complex a half-mile away where Bank of America built its own state-of-the- art facility less than a decade ago for about 550 traders and investment bankers. Most have since been fired or moved to New York. Police: Teacher offers sexual favors to officer to avoid DUI arrest (WPBF) According to the arrest report, an empty gallon jug of Carlo Rossi wine was found behind the driver's seat of Maloney's damaged van, which was parked on the side of the street when officers arrived. Police said Maloney refused to cooperate with officers during their DUI investigation. Police said she began yelling at them and made random vulgar statements. While she was on her way to the police station, Maloney allegedly told an officer, "How much do I need to pay you to just let me go? Don't you understand I am a school teacher?" She then offered to perform oral sex on the officer and let him fondle her breasts, the report stated. RBS Libor Fine May Hit $800M+ (Bloomberg) US and UK regulators could hit the Royal Bank of Scotland with as much as $804 million in fines next week to settle allegations traders tried to rig interest rates, two people with knowledge of the matter said. Investment banking chief John Hourican and Peter Nielsen, the head of markets, may also be asked to leave because they had responsibility for the parts of the company where the alleged wrongdoing occurred. The fine would be the second-largest levied by regulators in their investigation into allegations traders at the world’s biggest lenders manipulated submissions used to set the London interbank offered rate. UBS AG, Switzerland’s biggest lender, was fined $1.5 billion in December for rate-rigging, exceeding the 290 million pounds Barclays paid in June. Bob Khuzami, Master Blaster (NYP) Robert Khuzami yesterday took aim at a Columbia University professor who chided the SEC’s head of enforcement for not suing enough high-ranking individuals at large financial institutions, choosing instead to settle with those companies...Khuzami said in a blistering 1,500-word article in the National Law Journal that the SEC has charged a total of 102 individuals associated with the credit crisis, including high-level executives at Citigroup, Credit Suisse, Bear Stearns, and Fannie Mae and Freddie Mac...It’s the second time in as many weeks that Khuzami has called out his critics by name. Just before New Year’s Eve, the Brooklyn native blasted Simon Johnson, a professor at MIT Sloan School of Management, for a New York Times blog that said Khuzami’s hire was a “mistake” because of his former ties to Deutsche Bank. Khuzami shot back in the comment section of the blog — an unusual move for a public official. Wall Street Pay Gets Tougher Look (WSJ) Daniel Loeb, who runs hedge-fund firm Third Point LLC, has raised questions about whether compensation levels at Morgan Stanley are justified given the New York company's size and relative simplicity compared with larger bank. Hedge Funds' Manhattan Migration (WSJ) Of the new firms starting out in Manhattan, Greenwich or Stamford, about 86% picked the Big Apple, on average, from 2003 to 2008, according to eVestment, which tracks data on about 70% of U.S. hedge-fund firms. In 2009 and 2010, Manhattan was home to an average of 92% of the fund launches. Data for 2011 suggest the trend has continued. "There are blips in the data, but it's clear launches shifted toward New York after the crisis," says Peter Laurelli, eVestment's head of research. Detroit mafia boss says Jimmy Hoffa is buried in shallow grave north of Detroit (NYDN) Tony Zerilli, 85, says Hoffa was buried in a field outside Detroit, about 20 miles from the restaurant where he was last seen in July 1975. The aging Zerilli, who was in prison at the time of Hoffa’s disappearance, told TV news stations WNBC and WDIV that the plan was to move Hoffa’s body, but that never happened. “The master plan was, that I understood, was that they were going to put him in a shallow grave here. Then, they were going to take him from here to Rogers City upstate,” Zerilli said. “There was a hunting lodge and they were going to bury in a shallow grave then take him up there for final burial. Then, I understand, that it just fell through.” It was unclear why Zerilli chose to speak now about the 37-year-old mystery that has elicited dozens of false leads and conspiracy theories in the past. Zerilli said is to be ailing and penniless since his release from prison in 2008. WNBC reported he is promoting an upcoming book titled "Hoffa Found.” “All this speculation about where he is and he’s not,” Zerilli said. “They say he was in a meat grinder. It’s all baloney.”

Opening Bell: 11.13.12

Wall Street Damps Pay Expectations After 2011 Bonus Shock (Bloomberg) Almost 20 percent of employees won’t get year-end bonuses, according to Options Group, an executive-search company that advises banks on pay. Those collecting awards may see payouts unchanged from last year or boosted by as much as 10 percent, compensation consultant Johnson Associates Inc. estimates. Decisions are being made as banks cut costs and firms including UBS AG (UBSN) and Nomura Holdings Inc. (8604) fire investment-bank staff. Some employees were surprised as companies chopped average 2011 bonuses by as much as 30 percent and capped how much could be paid in cash. That experience, along with public statements from top executives, low trading volumes in the first half and a dearth of hiring has employees bracing for another lackluster year, consultants and recruiters said. “A lot of senior managers won’t have to pay up because they’re saying, ‘Where are these guys going to go?’” said Michael Karp, chief executive officer of New York-based Options Group. “We’re in an environment where a lot of people are just happy to have a job. Expectations have been managed so low that people will be happy with what they get.” Goldman Pares Back Partner Picks (WSJ) The New York company is expected to announce this week the promotion of about 70 employees to partner, said people familiar with the situation. The likely total is roughly one-third smaller than the 110 employees named partner by Goldman in 2010...As of Monday, the Goldman partnership committee hadn't finished the list of new partners, said people familiar with the matter. Greece Avoids Defaults (WSJ) Cash-strapped Greece on Tuesday raised the money it needs to avoid default when a Treasury bill matures later this week, but investor nerves are unlikely to be calmed as negotiations for the next slice of much-needed aid continue. The rift among Greece's official lenders over how to pare the country's growing debt pile spilled into the open late Monday, complicating efforts for an agreement that will free up a long-delayed aid payment to the country. The European Central Bank's reluctance to provide additional money to Greek banks poses a risk to the government, which in order to keep afloat has depended on support from local banks to sell its debt. Greece Needs Another 80 Billion Euros: Goldman Sachs (CNBC) The authors of the report, economists Themistoklis Fiotakis, Lasse Holboell Nielsen and Antoine Demongeot, note that the IMF’s target is “unlikely” without such a “drastic debt stock reduction.” “To increase the likelihood that the Greek debt-to-GDP ratio approaches its 120 percent by 2020 target under realistic assumptions, a much more drastic debt stock reduction (possibly north of 80 billion euros in total) will be required,” the report states. Japan Lawmakers Agree To Avert 'Fiscal Cliff' (Reuters) Japan's ruling and opposition parties agreed on Tuesday to quickly pass a deficit funding bill in parliament, in a move that will keep the country from falling off its version of a 'fiscal cliff' as the prime minister eyes elections as early as next month. The bill is needed to borrow some $480 billion and fund roughly 40 percent of this fiscal year's budget. Without it, the government could run out of money by the end of this month and would have to stop debt auctions next month, just as the economy teeters on the brink of a recession. Marc Faber: Prepare For A Massive Market Meltdown (CNBC) “I don’t think markets are going down because of Greece, I don’t think markets are going down because of the “fiscal cliff” – because there won’t be a “fiscal cliff,” Faber told CNBC’s “Squawk Box.” “The market is going down because corporate profits will begin to disappoint, the global economy will hardly grow next year or even contract, and that is the reason why stocks, from the highs of September of 1,470 on the S&P, will drop at least 20 percent, in my view.” FBI Agent in Petraeus Case Under Scrutiny (WSJ) A federal agent who launched the investigation that ultimately led to the resignation of Central Intelligence Agency chief David Petraeus was barred from taking part in the case over the summer due to superiors' concerns that he was personally involved in the case, according to officials familiar with the probe. After being blocked from the case, the agent continued to press the matter, relaying his concerns to a member of Congress, the officials said. New details about how the Federal Bureau of Investigation handled the case suggest that even as the bureau delved into Mr. Petraeus's personal life, the agency had to address conduct by its own agent—who allegedly sent shirtless photos of himself to a woman involved in the case prior to the investigation. Trial to Open in $68 Million Insider Trading Case (Dealbook) On Tuesday, Mr. Chiasson, 39, a co-founder of the now-defunct Level Global Investors, and Mr. Newman, 47, a former portfolio manager at Diamondback Capital Management, are set to stand trial in Federal District Court in Manhattan. Prosecutors say they were part of a conspiracy that made about $68 million illegally trading the computer company Dell and the chip maker Nvidia. MF Report Coming (Reuters) A US House of Representatives panel will release a long-awaited report that will dissect the collapse of failed commodities brokerage MF Global. The House Financial Services Committee said its Subcommittee on Oversight and Investigations will post the report online Thursday. A Dose of Realism for the Chief of J.C. Penney (NYT) Andrew Ross Sorkin: "You should know you have a problem when sales at your stores fall 26.1 percent in one quarter. That was the surprising decline J.C. Penney reported last week, when it disclosed that it had lost $123 million in the previous three months...Here's the good news: In the stores that have been transformed, J.C. Penney is making $269 in sales a square foot, versus $134 in sales a square foot in the older stores. So the model itself is working. And Mr. Johnson has the support of the company's largest shareholder, Pershing Square's Bill Ackman, who personally recruited Mr. Johnson. If Mr. Johnson were starting with a blank slate, it might be a great business." China Banker Sees Lower Bar for Yuan Globalization (WSJ) "Renminbi internationalization can be realized based on a partial opening of the capital-account and partial convertibility of the currency," said Mr. Li, a delegate to the 18th Communist Party Congress and longtime advocate of a greater global role for the yuan. The Eximbank is a major arm of the Chinese government for financing trade and investment overseas. Finally, a Place in Brazil Where Dogs Can Go for Discreet Sex (NYT) Heart-shaped ceiling mirror: check. Curtains drawn against the bright day: check. Red mattress: check. The establishment that opened here this year has features that demanding clients naturally expect from a love motel. Brazil, after all, is a world leader in these short-stay pleasure palaces, which beckon couples for trysts away from prying eyes with names like Swing, Absinthe and Alibi, and design motifs like medieval castles or of the American Wild West. But Belo Horizonte’s newest love motel stands apart from the crowd in one crucial aspect. It is for dogs. “I adore the romantic feel of this place,” said Andreia Kfoury, 43, a manager at a technology company who peeked inside the Motel Pet one recent morning while she and her husband were on a clothes-buying spree for their Yorkshire terrier, Harley. The couple, who are motorcycle enthusiasts, bought about $500 worth of imported Harley-Davidson brand items for their dog. “I’m definitely bringing Harley back here when it’s time for him to breed,” a smiling Ms. Kfoury said. “He is very macho, and would be a hit in this place.” Whether dogs like Harley actually need a romantic curtained-off suite to breed seems beside the point. Some dog owners simply like the concept of a love motel for their amorous pets and are willing to pay about $50 for each session, which Animalle will happily arrange.