Opening Bell: 12.15.16

Goldman spreads to the hinterlands; Yellen won't advise on Trump tweets; LSD for the working man; and more.
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Investment Banking in Dallas? Goldman Sachs Spreads Banker Web Beyond New York (WSJ)

Goldman_Sachs

Goldman Sachs Group Inc. is revamping its network of investment bankers, shifting partners to Dallas, Atlanta and other cities, according to people familiar with the matter. The firm is expected to detail some of these moves in coming days.

Trump Tweets, Stocks Tumble, and These Companies May Be Next (FactSet)

Given Trump’s predilection to delivering his thoughts directly to his followers and his promises to curb government waste, the Lockheed Martin tweets could be foreshadowing of a larger pattern of Trump-induced market reactions. To predict what other stocks could be the subject of Trump’s tweets moving forward, we found those that count the U.S. Government as their largest customers.

Yellen: It Isn’t Our Job At The Fed To Tell Donald Trump What To Tweet (CNBC)

At one point, a questioner asked what she thought about Trump's frequent use of Twitter to voice his strong opinions, and specifically about the market-moving shots he's taken at individual companies, including Boeing. "I'm not going to give the incoming president advice about how to conduct himself in policy," she said.

Janet Yellen and Donald Trump Are on the Same Page, for Now (WSJ)

One potential flashpoint with Mr. Trump is the dollar. It has rallied sharply since the election on expectations of higher interest rates. That may worsen the U.S. trade deficit, a central preoccupation of Mr. Trump.

Back To The Future (Ray Dalio)

For those interested in studying analogous periods, I recommend looking at 1935-45, after the 1929-32 stock market and economic crashes, and following the great quantitative easings that caused stock prices and economic activity to rebound and led to “pushing on a string” in 1935. That was the last time that the global configuration of fund­amentals was broadly similar to what it is today.

The Fed Nailed 2016, If You Ignore Their Rate Outlook (BBG)

The Federal Reserve was right about forecasts this year except the one that arguably matters most: short-term interest rates. That fabulously wrong rate guess came in sharp contrast to the Fed's unemployment and inflation projections, which look mostly spot-on based on what we know so far.

America’s Largest Pension Fund: A 7.5% Annual Return Is No Longer Realistic (WSJ)

A drop in Calpers’s rate of return assumptions could also put pressure on other funds to be more aggressive about their reductions and concede that investment gains alone won’t be enough to fund hundreds of billions in liabilities. Because of its size, Calpers typically acts as a bellwether for the rest of the pension world. It manages nearly $300 billion in assets for 1.8 million members.

A Productive Person’s Guide to a Little Bit of LSD (BBG)

According to the guidelines, microdosers should take 10 micrograms of LSD every three days, a quantity well under the threshold at which a user experiences hallucinations. If they do this, microdosing proponents claim, they’ll be rewarded with an improved mood, deeper insights, and unprecedented focus and creativity.

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