Opening Bell: 2.1.17

Dalio outpaces his peers; Jamie Dimon loves cross-selling; apes are swiping right; and more.
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Ray Dalio Makes Clients $4.9 Billion in 2016 as Paulson, Soros Falter (Bloomberg)

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Billionaire Ray Dalio’s Bridgewater Associates earned almost $5 billion for its clients last year while rivals George Soros and John Paulson lost money, according to a report by hedge-fund investor LCH Investments NV. Bridgewater was the most lucrative, in absolute terms, of the top-20 hedge funds ranked, and bucked the trend of a generally disappointing year for the industry.

Private Banking Meets Cross-Selling for JPMorgan’s Wealthy Clients (BBG)

“Cross-selling is a big deal. And we do an exceptionally good job at cross-selling. We think we’re among the best out there,” Chief Executive Officer Jamie Dimon told an investor conference in September 2012, referring to the bank’s retail business. Fifteen months later he told another conference: “We do as much cross-sell as a Wells Fargo.”

Trump Aide’s Deal With Chinese Firm Raises Fear of Tangled Interests (NYT)

“They know they cannot talk to me, so what influence are they buying?” Mr. Scaramucci said in the interview. “If people are saying that HNA is trying to buy access, then people are saying HNA is stupid…. I took their bid because it would protect my clients, partners and investors,” he said. “So what did I do wrong?”

Deutsche Bank Beset by Grim Morale, Uncertain Profit Outlook (WSJ)

Deutsche Bank employees expected smaller bonuses this year—no one could accuse Mr. Cryan of telegraphing a bonanza—but past years’ dire warnings proved exaggerated, some bankers say, making January’s bad bonus news more jarring. Some managers have told employees that this year’s starker bonus year appears aimed at encouraging voluntary departures ahead of deeper staff cuts.

Actually, Deutsche Bank’s retention bonuses are more cunning than we thought (EFC)

Earlier this week we reported that the recipients of Deutsche’s retention bonuses were annoyed with the “strike price.” At €23, this is around 22% higher than Deutsche’s current share price and above the level Deutsche has traded at since December 2015. This still stands, but Deutsche insiders say the retention bonuses have been structured with some added twists. Firstly, for the deferred stock bonuses to be valid, Deutsche’s shares only have to hit €23 during the first three trading weeks of 2021. If, at any time during that period, the stock price falls below €23, the retention bonuses now being allocated for 2016 will be worth nothing at all. Secondly, if the €23 condition is met, recipients of the bonuses will get their holdings increased by a factor of 1.8.

It’s Getting Harder to Keep the Barbarians at the Gate—and It’s This Guy’s Job (BBG)

Rossman’s thesis is that activists could gain more clout as stock ownership is concentrated among fewer owners, with funds shifting to indexed strategies. “It’s become a lot easier for activists to ­influence the shareholder base, because they have fewer and fewer shareholders that they have to talk to,” says Rossman, who calculates that the top 25 investors hold almost 40 percent of the S&P 500. Research published in September by the National Bureau of Economic Research (NBER) outlined a finding similar to Rossman’s — that activists may become more powerful with the rise in passive investing.

Peter Thiel became New Zealand citizen in California in 2011 (AP)

Silicon Valley billionaire and President Donald Trump's adviser Peter Thiel was able to gain New Zealand citizenship in 2011 despite never having lived in the country, because a top lawmaker decided his entrepreneurial skills and philanthropy were valuable to the nation, documents revealed. Thiel didn't even have to leave California to become a new member of the South Pacific nation. He was granted citizenship during a private ceremony held at the New Zealand Consulate in Santa Monica.

Dutch experiment with 'Tinder for orangutans' (PhysOrg)

"After seeing the photos, the monkeys have to push a button on the screen," the park said. "In this way we can measure their capacity for reaction." The research, conducted with Leiden University, could improve breeding programmes for the apes, the park said. Initial results indicate that bonobos, an endangered ape species, react most strongly to photos showing positive behaviours, such as sexual activity or searching for lice, the park said.

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Opening Bell: 1.18.17

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Opening Bell: 6.3.15

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Opening Bell: 04.12.12

Buffett Feasts On Goldman Scraps (WSJ) Details of one trade in particular have recently caused a stir in the market. In November, Goldman sold about $85 million of loans in troubled newspaper publisher Lee Enterprises Goldman sold the debt at about 65 cents on the dollar, having bought it months before at around 80 cents, resulting in a loss of at least $13 million. The buyer: a unit of Warren Buffett's Berkshire Hathaway Inc., according to several people familiar with the matter. Mr. Buffett has since made a tidy paper profit on the loans, which are now worth about 82 cents on the dollar, the people said. Jim Chanos: Chinese Banks ‘Great Shorts,’ Won’t Be Broken Up (CNBC) Chanos, the head of Kynikos Associates, has been betting against China — despite its role as a global economic leader — primarily because he believes the country is overbuilt and does not have the internal demand to support its ambitious growth plans. Nowhere has that trend been more apparent than in the banking system. "If you looked at the performance of the banks over the last two years...they have been great shorts," Chanos said. "They have been going down — they're down 30 percent over the last two years." George Soros: Exceptional Measures Needed to Save EU (FT) "Other countries have gone through similar experiences. Latin American countries suffered a lost decade after 1982, and Japan has been stagnating for a quarter of a century; both have survived. But the European Union is not a country and it is unlikely to survive. The deflationary debt trap threatens to destroy a still-incomplete political union," he wrote. Blackstone President To Raise For Obama (Morning Money) "Tony James, the president of Blackstone Group LP, has agreed to hold a fundraiser for... Obama’s re-election campaign, according to two people familiar...By agreeing to raise money for Obama, James has diversified Blackstone’s political bets for the November election. Blackstone Chairman Stephen Schwarzman has been raising money for former Massachusetts governor Mitt Romney, the likely Republican nominee." SEC, Goldman to Settle Research Case (Reuters) U.S. securities regulators are preparing to announce that Goldman Sachs will pay $22 million to settle allegations the bank did not have adequate policies to prevent research from being passed inappropriately to preferred clients, people familiar with the matter said on Wednesday. BlackRock's Street Shortcut (WSJ) BlackRock is planning to launch a trading platform this year that would let the world's largest money manager and its peers bypass Wall Street and trade bonds directly with one another. The electronic trading hub has the potential to reduce a lucrative revenue stream for investment banks at a time when their businesses are being squeezed by lackluster markets and new regulations put in place to curb risk in the aftermath of the financial crisis. The trading platform would be run by the New York-based company's BlackRock Solutions arm and offer 46 clients—including sovereign-wealth funds, insurance companies and other money managers—the ability to trade in corporate bonds, mortgage securities and other assets, company executives say. Under the plan, the platform would seek to match buyers and sellers of the same securities, in a process known as "crossing trades." BlackRock Solutions would charge a small fee for the service that would be much lower than Wall Street's trading commissions. New Yorker breaks up subway scuffle, snacks in hand (NYDN) Sonder, 24, played the role of hungry hero “two or three Thursdays ago” after hopping on an uptown 6 train at Spring St. The calm inside the subway car was shattered a minute later when a tussle broke out between a man and a woman. “I turned around and I saw these two kicking each other pretty viciously,” said the sturdy Sonder, who stands six-feet tall and weighs 200 pounds. “I stepped over and tried to see if I could help.” Mid Pringle, Sonder thrust himself between the pugilists. More chips were eaten, but no other punches or kicks were thrown. “I just got caught up in the moment,” said Sonder, who was also holding a bag of gummy bears during the incident. Dimon Vows Fight Moynihan Lost Over Claims From Mortgages (Bloomberg) “We are going to fight repurchase claims that pretend the steep decline in home prices and unprecedented market conditions had no impact on loan performance,” Dimon, chief executive officer of the New York-based lender, wrote in the April 4 letter. He’ll also oppose “securities claims brought by sophisticated investors who understood and accepted the risks.” Jobless Claims Post Jump; PPI Up, Trade Deficit Down (Reuters) Initial claims for state unemployment benefits increased 13,000 to a seasonally adjusted 380,000, the Labor Department said on Thursday. The prior week's figure was revised up to 367,000 from the previously reported 357,000. Fur Flies in High-Stakes Airlifts of Animals by Lufthansa (Bloomberg) An African white rhinoceros peers through the bars of its Frankfurt compound, while across the floor a Madagascan chameleon inches around its vivarium and an Andean alpaca plucks hay from a bale. It’s not a scene from the city’s zoo but from Deutsche Lufthansa AG’s Animal Lounge, a state-of-the-art complex that’s at the center of the German carrier’s plans to dominate the most specialized part of the $66 billion air-cargo industry. Lufthansa, Air France-KLM Group and Dubai-based Emirates, which transports thoroughbreds for Sheikh Mohammed bin Rashid Al Maktoum, horseracing’s leading owner, are competing in a high- stakes market. Premium profit margins come with the risk of an in-flight death involving a beloved family pet, top-ranked stallion or priceless panda. “It’s not like pharmaceuticals, where your main concern is the temperature,” said Animal Lounge Director Axel Heitmann. “If a bag of fish leaks it needs replacing with the right kind of water and the right oxygen. And if something goes wrong you can’t just hand a customer $1,000 and tell him to buy another pet. He wants the dog or cat he’s had for 10 years.” KKR Invests in China Cord Blood (WSJ) Kohlberg Kravis Roberts & Co. L.P. will invest $65 million into China Cord Blood Corp., the country's largest operator of services for umbilical cord blood that is rich in stem cells, to capitalize on China's fast growing healthcare services industry. Police: Dealer tied 89 bags to penis, peed at the station (Philly) Police Corporal Christopher Eiserman said another officer was on routine patrol Friday when he pulled Ray Woods over for a broken rear light and found marijuana in his car. When the officer searched Woods before placing him in the police cruiser, he discovered "a large bulge" in the front of his pants, Eiserman said. Police say Woods actually had the balls to deny that there was any contraband down there. “He stopped him for the traffic violation and one thing led to another," Eiserman said. Back at the station, Eiserman said, police discovered that Woods had tied a large plastic bag around his penis that contained a whopping 89 small bags of suspected heroin and cocaine. Then things got messy. “I tried to remove it. Unfortunately, and I don't know if it was nervousness or not, but he started urinating all over," Eiserman said. While it wasn't exactly what Eiserman had in mind when he started his shift Friday, he couldn't help but chuckle at the ingenuity, or lack thereof, of street-level drug dealers. “In 14 years, I’ve seen it down their pants, in their a--, but I've never seen it tied to their penis," he said.

(Getty Images)

Opening Bell: 1.3.17

Anshu Jain starts afresh at Cantor Fitzgerald; Jamie Dimon to keep JPMorgan in London; Facebook censors ancient sea God's junk; and more.