Opening Bell: 3.15.17

Jamie Dimon still working on his Business Roundtable talking points; Ackman lost some money; sex toy snoops on users; and more.
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"Christ, Janet!" Photo: Steve Jurvetson, via Wikimedia Commons

"Christ, Janet!" Photo: Steve Jurvetson, via Wikimedia Commons

JPMorgan's Dimon: Repatriation will create 'QE4'-like stimulus (CNBC)
"If all companies did [with repatriated funds] was pay dividends and buy back stock, think of that as QE4 ... and far cheaper, in my opinion," Dimon said, comparing the stimulative effect to that of the Federal Reserve's multiyear monetary easing. "The shareholder will decide what to do with it. It's not like it disappears after that. It is fuel to the system."

Sports Betting Is Starting to Look a Lot More Like Wall Street (BBG)
Contrarian Investments owner Chris Connelly said he has both domestic and foreign investors. Similar to the common Wall Street method of looking for arbitrage in overvalued or undervalued stocks, Connelly said he uses a computer model to look for overvalued gambling spreads and bets against them. “Instead of investing in the stock market and taking a certain stock, I’m investing on sports spreads of athletic teams,” Connelly said. “So I focus on football and basketball, college and pro.”

Fed Is Ready to Raise Rates, but Key Bank Metric Suggests Caution (WSJ)
“The last five, six years, you’ve had actually decent industry loan growth” despite somewhat weak gross domestic product figures, Evercore ISI analyst Glenn Schorr said recently. “Now we have optimism that some policy change will bring” higher GDP growth. “Yet, every bank is talking down expectations for loan growth. It seems a little backwards.”

Proof Wall Street Is Still a Boys’ Club (BBG)
A new study finds that, when it comes to truly celebrating women, Wall Street still has a long way to go. The results show that investment firms treat male employees very differently from female employees after they get in trouble. While women are far less likely to engage in misconduct, they’re punished much more harshly for any infractions.

Focus on Bank Culture Is an Odd Regulatory Strategy (Dealbook)
It is a strange regulatory tool. The Environmental Protection Agency does not spend a lot of time worrying about the ethics of oil refiners or power utilities. It just regulates their emissions. Nor are the country’s workplace safety rules structured around requirements for employers or co-workers to act ethically.

Bill Ackman Is Done Losing Money on Valeant (Bloomberg View)
Everything went bad -- in most tellings, precisely because Valeant was so purely a creature of modern shareholder capitalism. The focus on ruthless efficiency led to pricing decisions that were political and public-relations disasters. The compensation scheme seems to have incentivized shenanigans. The leverage didn't help. Rather than finding an undervalued company with a good business but a shoddy management team and pushing it to extract value from its business more efficiently, Pershing Square found a hyper-efficient value extractor and watched the wheels fall off. That's not the ideal approach.

Domino’s Atoned for Its Crimes Against Pizza and Built a $9 Billion Empire (Businessweek)
At Domino’s Farms, executives had already admitted to themselves a more persistent long-term threat: The pizza wasn’t very good. “When we did consumer tests, if they knew the pizza was Domino’s, they actually liked it less than if they just thought it was a random unbranded pizza,” Doyle says. “We had somehow created a situation where people liked our pizza less if they knew it was from us. So yeah, that was a problem.” Some of the more memorable comments: “The crust tastes like cardboard. The sauce tastes like ketchup.” And: “This is an imitation of pizza.”

Lie-bor? More like Li-BORE, am I right? (FT Alphaville)
Regulators wanted to discourage unsecured short-term lending between banks, since that reduces risk in the financial system. And regulators have responded to the lack of liquidity cited above by tasking a committee of dealers with finding a new benchmark for the swaps market. But after the structural changes, it’s important to remember Libor-related indicators aren’t as reliable as they used to be. And that could make it tougher to get a measure of global banks’ default risk.

Sex toy company to pay $4M to settle claims it spied on users (NYPost)
Two people filed the lawsuit against the Canadian sex toy maker last year after it came to light at the hacking conference, Def Con, that the We-Vibe company was collecting data regarding how customers used the vibrators. The smartphone app transmitted information to the company’s servers about the usage, including temperature and the vibration intensity the owners used the vibrators at and how frequently they were used.

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Opening Bell: 05.14.12

JPMorgan Loss Claims Official Who Oversaw Trading Unit (NYTimes) The $2 billion trading loss at JPMorgan Chase will claim its first casualty among top officials at the bank as early as Monday, with chief executive Jamie Dimon set to accept the resignation of the executive who oversaw the trade, Ina R. Drew. Ms. Drew, a 55-year-old banker who has worked at the company for three decades and serves as chief investment officer, had repeatedly offered to resign since the scale of the loss became apparent in late April, but Mr. Dimon had held off until now on accepting it, several JPMorgan Chase executives said. Two traders who worked for Ms. Drew also planned to resign, JPMorgan Chase officials said. Her exit would mark a stunning fall from grace for one of the most powerful women on Wall Street, as well as a trusted lieutenant of Mr. Dimon...Former senior-level executives at JPMorgan said it was a shame that Ms. Drew has ended up suffering much of the fallout from the soured trade. They said that Thursday’s announcement of the $2 billion loss was the first real misstep that Ms. Drew has had and said that the position was not meant to drum up bigger profits for the bank, but rather to ensure that JPMorgan could continue to hold lending positions in Europe. “This is killing her,” a former JP Morgan executive said, adding “in banking there are very large knives.” Jamie Dimon: Trading Losses Are Not Life-Threatening (CNBC) “This is a stupid thing that we should never have done but we’re still going to earn a lot of money this quarter so it isn’t like the company is jeopardized,” he said in an interview with NBC’s “Meet with Press.” “We hurt ourselves and our credibility, yes — and that you’ve got to fully expect and pay the price for that.” Yahoo’s Thompson Out Amid Inquiry; Levinsohn Is Interim CEO (Bloomberg, earlier) Thompson, 54, was brought on to orchestrate a turnaround after Google Inc. and Facebook Inc. lured users and advertising dollars. Thompson’s undoing stems from erroneous biographical references to him as holding a bachelor’s degree in computer science from Stonehill College. A former EBay Inc. (EBAY) executive, he earned a degree in accounting from the Easton, Massachusetts- based school, and the information is correctly listed in EBay regulatory filings and some Yahoo press releases. The incorrect degree showed up in Yahoo’s April 27 10-K filing, as well as on the company’s website. As part of the board changes, Daniel Loeb, chief executive officer of Third Point, joins as a director along with Harry Wilson and Michael Wolf. A fourth nominee, Jeffrey Zucker, said in today’s statement that he withdrew his nomination to allow a quick transition. Euro Officials Begin to Weigh Greek Exit (Bloomberg) Greek withdrawal “is not necessarily fatal, but it is not attractive,” European Central Bank Governing Council member Patrick Honohan said in Tallinn on May 12. An exit was “technically” possible yet would damage the euro, he said. German Finance Minister Wolfgang Schaeuble reiterated in an interview in Sueddeutsche Zeitung that member states seeking to hold the line on austerity for Greece could not force the country to stay. LightSquared Moves Toward Bankruptcy Filing (WSJ) Hedge-fund manager Philip Falcone's LightSquared Inc. venture was preparing Sunday to file for bankruptcy protection after negotiations with lenders to avoid a potential debt default faltered, said people familiar with the matter. LightSquared and its lenders still have until 5 p.m. Monday to reach a deal that would keep the wireless-networking company out of bankruptcy court, and there were some indications over the weekend that a final decision hadn't yet been reached on its fate. Still, the two sides remained far apart, and people involved in the negotiations expected LightSquared to begin making bankruptcy preparations in earnest. Facebook cofounder living large in Singapore as he stiffs US for a possible $600M in taxes (NYP) Saverin is renouncing his US citizenship in favor of Singapore, the Southeast Asian city-state that has no capital-gains tax, where he has lived like royalty since 2009. The move already has saved him about $288 million in taxes, and will save him much more if he chooses to sell his $4 billion personal stake in Facebook, which goes public next week. “This pisses me off,” fellow tech-industry billionaire Mark Cuban spat on Twitter Friday upon hearing news of Saverin’s decision. Saverin’s spokesman has defended the move, claiming he has investments in the Far East, and Europe and the permanent move makes perfect sense. “Eduardo recently found it more practical to become a resident of Singapore since he plans to live there for an indefinite period of time,” Saverin’s spokesman told Bloomberg. JPMorgan Unit's London Staff May Go as Loss Prompts Exits (Bloomberg) The entire London staff of JPMorgan Chase’s chief investment office is at risk of dismissal as a $2 billion trading loss prompts the first executive departures as soon as this week, a person familiar with the situation said. The firm is examining whether anyone in the unit, which employs a few dozen people in London, sought to hide risks, said the person, who requested anonymity because the deliberations are private. In Wake Of JPMorgan Loss, Rivals Fret About New Rules, Downgrades (WSJ) Over the weekend, rival banks scurried to explain why they believe a similar trading loss couldn't happen at their firm. Some companies pointed to moves already taken to reduce risk and sell off volatile and opaque assets such as derivatives on credit indexes. In a statement, Citigroup "has a small amount of straight-forward economic hedges managed at the corporate center to mitigate our credit exposure, principally relating to consumer loans." About half of that total is in cash, with most of the rest in U.S. Treasury bonds and other conservative investments. At Morgan Stanley, the portfolio most similar to J.P. Morgan's investment office is a $32 billion "available for sale" portfolio. The portfolio primarily consists of easily traded U.S. Treasury and government agency securities. It doesn't hold any derivatives instruments, a person familiar with Morgan Stanley's operations said. Goldman Sachs has no similar unit to the one at J.P. Morgan that suffered the loss. Apple Founder Wozniak to Buy Facebook Regardless of Price (Bloomberg) “I would invest in Facebook,” he said in an interview yesterday on Bloomberg Television. “I don’t care what the opening price is.” Missing: Stats on Crisis Convictions (WSJ) It is a question that has been asked time and again since the financial crisis: How many executives have been convicted of criminal wrongdoing related to the tumultuous events of 2008-2009? The Justice Department doesn't know the answer. That is because the department doesn't keep count of the numbers of board-level prosecutions. In a response earlier this month to a March request from Sen. Charles Grassley (R.,Iowa), the Justice Department said it doesn't hold information on defendants' business titles. "Consequently, we are unable to generate the [requested] comprehensive list" of Wall Street convictions stemming from the 2008 meltdown, the letter from the Department of Justice to Mr. Grassley said. Man Charged in Death Offers Victim's Foot for Deal (AP) A homeless man charged with killing and dismembering his friend says he can't remember much about the crime. But in a jailhouse interview, Leslie Sandoval told the Anderson Independent-Mail he remembers where he put the victim's missing left foot and is willing to tell a prosecutor if she will make him a deal. Sandoval says he went on a January drinking binge with Seth Foster. Foster's torso was found under an Anderson home, and his head, hands and right foot were found different places. Sandoval says he is confused about exactly what happened. But he disagrees with a coroner's finding he beat Foster and denies a claim from investigators that he confessed and gave them the knife used to dismember Foster.

Goldman.JustAddButter

Opening Bell: 9.22.17

Goldman is slipping in the I-banking rankings; ETF market effects provide opportunities for active managers; Jamie Dimon still hates bitcoin; Netflix is leading our children into sin; and more.

(Getty Images)

Opening Bell: 8.17.17

Jamie Dimon makes bold stand against Nazis; Steve Bannon (accidentally?) grants lengthy interview on America First trade policy; Ackman uses protection; the perils of butt-dialing; and more.

Opening Bell: 5.18.16

Bond buyers can't help themselves; Silicon Valley mocks Trump; Walmart Theft Suspect Told Cops She Was "Too Lazy" To Pay For Stolen Sex Toys; and more.

Opening Bell: 08.20.12

Diamond Censured Over Evidence in Barclays Libor Probe (Bloomberg) Barclays ex-Chief Executive Officer Robert Diamond was criticized for giving “unforthcoming and highly selective” evidence by a U.K. parliamentary report that faulted the bank for letting traders rig interest rates. The “candor and frankness” of Diamond’s testimony to lawmakers on July 4 “fell well short of the standard that Parliament expects,” the House of Commons Treasury Committee said in a 122-page report today following its inquiry into the bank’s attempts to manipulate the London interbank offered rate. “The Barclays board has presided over a deeply flawed culture,” the panel of British lawmakers said. “Senior management should have known earlier and acted earlier.” Bob Diamond Hits Bank In Rate-Rigging Row (Telegraph) In a statement Mr Diamond hit back at the report. "I am disappointed by, and strongly disagree with, several statements by the Treasury Select Committee,” Diamond said. Deutsche Bank’s Business With Sanctioned Nations Under Scrutiny (NYT) Federal and state prosecutors are investigating Deutsche Bank and several other global banks over accusations that they funneled billions of dollars through their American branches for Iran, Sudan and other sanctioned nations, according to law enforcement officials with knowledge of the cases. JPMorgan Picks Leader For 'Whale' Probe (WSJ) JPMorgan directors have named Lee Raymond chairman of a board committee investigating the bank's multibillion-dollar trading blunder, said people close to the probe. Some Groupon Investors Give Up (WSJ) Some of the early backers of Groupon, including Silicon Valley veteran Marc Andreessen, are heading for the exits, joining investors who have lost faith in companies that had been expected to drive a new Internet boom. At least four Groupon investors who held stock in the daily-deals company before it went public have sold or significantly pared back their holdings in recent months. Since its initial public offering in November, Groupon has shed more than three-quarters of its stock-market value, or about $10 billion...Mr. Andreessen, who rode the 1990s dot-com frenzy to riches at Netscape Communications Corp., was among the investors who helped fuel Groupon's rapid ascent. His firm, Andreessen Horowitz, was responsible for $40 million of the $950 million investors put into Groupon just months before the company's IPO. Andreessen Horowitz sold its 5.1 million Groupon shares shortly after restrictions on selling the stock expired June 1, according to people with knowledge of the transaction. Facebook Investors Brace For More Shares Coming To Market (Bloomberg) While Facebook Chief Executive Officer Mark Zuckerberg operates the world’s largest social-networking service, he’s facing investor concerns about how it can generate more revenue from its growing user base. That, plus the end of the first lock-up, drove the shares to half the offering price of $38, wiping out almost $46 billion in market value. Queen's corgis 'attack' Princess Beatrice's terrier Max (Telegraph) They may be among the Queen's favourite subjects but her corgis are in the doghouse after getting into a fight with one of Princess Beatrice's pets. Max, an 11–year–old Norfolk terrier, is said to have been badly injured after a "nasty" encounter at Balmoral castle last week. The Princess's pet nearly lost an ear and suffered several bloody bite injuries that had to be treated by a vet, in the latest in a series of scraps between royal dogs..."The Queen's dog boy was taking the corgis for a walk and they were joined by the Norfolk terriers, which came with Prince Andrew," one insider told a Sunday newspaper. "They were being taken along the long corridor leading to the Tower Door before being let into the grounds for a walk, and they all became overexcited. They began fighting among themselves and unfortunately the dog boy lost control. "The next thing we knew there were horrific yelps and screams...there was blood everywhere." EU Leaders Plan Shuttle Talks To Bolster Greece, Sovereign Bonds (Bloomberg) The sovereign-debt crisis mustn’t become a “bottomless pit” for Germany, even though Europe’s biggest economy would pay the highest price in a breakup of the euro region, German Finance Minister Wolfgang Schaeuble said on Aug. 18 during his ministry’s open day in Berlin. “There are limits,” he said, as he ruled out another aid program for Greece. Hedge 'A-Listers' Include Ackman, Loeb, Chanos (NYP) Influential adviser Cliffwater LLC — which monitors some 1,500 hedge funds and ranks them with an A, B or C grade — keeps a closely guarded list of 90 or so top-rated funds...Cliffwater advises large pension funds in New Jersey, Wisconsin and Massachusetts, among others, and has become one of the industry’s hottest gatekeepers as more big institutions invest directly in hedge funds rather than through funds of funds...An August copy of Cliffwater’s “500 top-rated A or B” funds shows that the company gives high marks to activist funds such as Ackman’s Pershing Square and also to tail risk funds, which aim to protect against disasters. Tucked inside the protected internal document, which compares five-year historical returns to risk, is Cliffwater’s “Select List,” which appears to be the 95 funds deemed worthy of A ratings. Along with Ackman, Dan Loeb of Third Point, the hedgie who recently rattled Yahoo!, famed short-seller Jim Chanos of Kynikos Associates and gold hound James Melcher of Balestra Capital, made the short list as well. Spitzer Defends Wall Street Legacy (FT) Last week it emerged that Goldman Sachs had brought the curtains down on its Hudson Street platform, one of the most high-profile independent research projects started by an investment bank involved in the settlement. Other settlement banks, such as UBS and Bank of America Merrill Lynch, are said to have closed or scaled down their own independent analysis projects. Mr. Spitzer was quick to defend the legacy of the global settlement in an interview with the Financial Times. “I think we accomplished something,” Mr. Spitzer said. “There are a lot of independent research firms out there, some doing well and others not. Goldman has other business models and other priorities.” Shia LaBeouf To Have Sex "For Real" While Filming Scenes For Lars Von Trier's "Nymphomaniac" (Complex) "It is what you think it is. There's a disclaimer at the top of the script that basically says, we're doing [the sex] for real. And anything that is 'illegal' will be shot in blurred images. But other than that, everything is happening," LaBeouf said during an interview.

Opening Bell: 01.23.13

Greece Charges Statisticians Over Size of Deficit (FT) Greece has brought criminal charges against the official responsible for measuring the country's debt, thereby calling into question the validity of its 172 billion euros second bailout by the EU and International Monetary Fund. Andreas Georgiou, head of the independent statistical agency Elstat, and two senior officials are accused of undermining the country's "national interests" by inflating the 2009 budget deficit figure used as the benchmark for successive austerity packages. The three statistical experts face criminal charges of making false statements and corrupt practices, a judicial official said, adding that if found guilty they could serve prison terms of five to 10 years. They have denied any wrongdoing. Spain's Recession Deepens (WSJ) Spain's central bank said a recession in the euro zone's fourth-largest economy deepened slightly in the final quarter of last year, but it said austerity cuts are bringing the country's runaway budget deficit under control. Obama-Bashing Swapped for Pragmatism at Davos (Bloomberg) “We have to move on in our society,” Blackstone found Stephen Schwarzman said today in an interview in Davos with Bloomberg Television’s Erik Schatzker. “I like President Obama as a person, and he’s well- intentioned.” Schwarzman, 65, warned in Davos in 2010 that banks could restrict lending because “their entire world is being shaken and they’re being attacked personally.” Later that year, at a nonprofit group meeting, he likened Obama’s tax proposals to Hitler’s invasion of Poland. Third Point LLC CEO Daniel Loeb, who in 2010 compared Wall Street’s Obama supporters to “battered wives,” will help lead a Jan. 25 Davos dinner discussion, “Can Capitalism Evolve?” Schwarzman apologized in 2010 for his comparison of Obama’s effort to double taxes on private-equity income to the invasion of Poland. He said the analogy was inappropriate and that the administration’s need to work with business “is still of very serious concern.” JPMorgan's Jamie Dimon Apologizes, Attacks (WSJ) James Dimon of J.P. Morgan Chase was prepared in Davos to apologize for the more than $6 billion of trading losses racked up by the so-called London Whale, but he certainly wasn’t prepared to abase himself...Min Zhu, deputy managing director of the International Monetary Fund, reeled off a string of statistics to show that the industry certainly hadn’t cleaned up its act since the crisis, and Paul Singer, principal of hedge fund Elliott Associates, was also keen to lambaste big banks, including Mr. Dimon’s. The two had some testy exchanges and the body language indicated that Messrs. Singer and Dimon have exchanged fire quite a few times previously. Still, Mr. Dimon gave us good as he got. He kicked off with repeating his apology to shareholders for the London Whale trading losses, which led to his own bonus being slashed, saying, “If you’re a shareholder of mine, I apologize deeply.” Having offered this apology he then went on the offense. He pointed out that his bank lent money to a whole host of worthy organizations such as schools, hospitals, governments, and Italian and Spanish corporates and governments. And he also had some snappy comebacks. Elliott’s Singer said that the global banks are “too big, too leveraged, too opaque,” which left Mr. Dimon with an easy retort about how could a hedge fund possibly criticize a bank about being opaque? “Our [securities filing] 10K is 400 pages long,” Mr. Dimon said. “What would you like to know?” Geithner Exit Next Friday (AFP) US Treasury Secretary Timothy Geithner, who steered the administration of President Obama through the financial crisis, will step down from his post Friday, a source told Agence France Presse yesterday. Golfer Mickelson recants tax rant (NYP) Mickelson — who hinted he might move from his home state of California to escape higher taxes — said he regretted his public rant on the issue after setting off a political firestorm. “Finances and taxes are a personal matter and I should not have made my opinions on them public,” according to a statement from Mickelson, who plans to elaborate today at the Farmers Insurance Open. “I apologize to those I have upset or insulted and assure you I intend to not let it happen again.” Senator Lautenberg Suggests Spanking In Store For Mayor Cory Booker (CI via DI) "I have four children, I love each one of them. I can't tell you that one of them wasn't occasionally disrespectful, so I gave them a spanking and everything was OK," Lautenberg said with a smile in his first public comments since Booker announced he was considering a run for Senate. Banker's Latest Bet: Teamwork on Bonds (WSJ) Texas banking tycoon Andrew Beal is known for making unconventional moves, including gambling on high-stakes poker and a self-financed plan to launch rockets into space. His latest gambit: an attempt to wring money from giant banks by banding together aggrieved bondholders. Mr. Beal's CXA Corp. ran a pair of advertisements late last year, one appearing in The Wall Street Journal. The ads listed an alphabet soup of residential mortgage-backed securities held by CXA and asked those with positions in the same securities to join the company in investigating possible infractions by banks that sold the debt. If the groups can prove the mortgages that underlie the bonds were approved through shoddy underwriting, they could be entitled to compensation—CXA's payday alone could be tens of millions of dollars. Firms Keep Stockpiles Of 'Foreign' Cash In US (WSJ) Some companies, including Internet giant Google, software maker Microsoft, and data-storage specialist EMC Corp, keep more than three-quarters of the cash owned by their foreign subsidiaries at U.S. banks, held in U.S. dollars or parked in U.S. government and corporate securities, according to people familiar with the companies' cash positions. In the eyes of the law, the Internal Revenue Service and company executives, however, this money is overseas. As long as it doesn't flow back to the U.S. parent company, the U.S. doesn't tax it. And as long as it sits in U.S. bank accounts or in U.S. Treasurys, it is safer than if it were plowed into potentially risky foreign investments. SEC Reins In Ratings Firm (WSJ) The U.S. Securities and Exchange Commission barred Egan-Jones Ratings Co. from issuing ratings on certain bonds, an unprecedented step by the regulator and a setback for a small credit-rating firm with a history of courting controversy. The SEC said Tuesday that Egan-Jones couldn't officially rate bonds issued by countries, U.S. states and local governments, or securities backed by assets such as mortgages, for at least the next 18 months. The ban was part of an agreement the SEC reached with Egan-Jones and its president, Sean Egan, to settle charges that they filed inaccurate documents with the regulator in 2008. The SEC alleged that Egan-Jones misled investors about its expertise, and that Mr. Egan caused the firm to violate conflict-of-interest provisions. Lindenhurst dentist busted after reporting to work reeking of booze and drilling teeth while allegedly drunk (NYDN) Dr. Robert Garelick was hauled out of his Lindenhurst office in handcuffs Monday after his dental hygienist smelled booze on his breath and caught him administering Novocain to the wrong side of a patient’s mouth. “I observed Dr. Garelick looking for cavities in the right side of the patient’s mouth, but the cavities were in the left side,” hygienist Kimberly Curtis told police in a written statement. “I pointed this out to the doctor and that’s when he ordered more Novocain for the patient,” Curtis told cops. “So now, he basically numbed the whole patient’s mouth.” After noticing Garelick’s wobbly behavior Monday, Curtis texted co-worker Dina Fara, who called 911. Curtis said she sent the message after Garelick used a drill to treat another patient who had a chipped tooth. “He was filing the tooth down,” Curtis said. “When you’re using that drill, you have to be very careful and have a steady hand.” She said that just before Garelick treated the chipped tooth, he slipped into his office. “I noticed that he was drinking from a white and purple squeeze bottle,” Curtis said. “At first I didn’t think anything was wrong,” Curtis said. “But right after, he took a drink from that bottle, he got up and walked past me. When he did this I smelled a strong odor of alcohol.” The dentist initially claimed he only had a couple of beers with pizza during lunch Monday, according to Suffolk County cops. But Garelick, who was charged with misdemeanor reckless endangerment, later confessed to his drunken dentistry while being taken to a police precinct in the back of squad car. “I never had any beers with my pizza. I’ve been sipping at that bottle all along today,” he told police, referring to his squeeze bottle filled with vodka, according to a criminal complaint.

Opening Bell: 03.12.13

Apple To Announce Plans For Cash Hoard (WSJ) Apple will outline what it plans to do with a growing pile of cash by next month, according to Howard Ward, chief investment officer at Gamco Investors Inc. Apple, which has been grappling with investor criticism over the handling of its $137.1 billion in cash and investments, will add $42 billion in earnings to that sum in 2013, Ward said. Greenlight Capital Inc.’s David Einhorn has been urging Cupertino, California-based Apple to issue high-yielding preferred shares to spread the funds among investors. Investors are also urging Apple to consider a higher dividend payout. “We’re going to get an announcement from the company as to how they intend to reallocate some of their cash,” Ward said in an interview today on Bloomberg Radio’s “Surveillance” with Tom Keene. “They will put a floor under their stock at a higher price than it is today.” AIG shareholders win class-action status in lawsuit versus U.S. (Reuters) Two groups of American International Group shareholders won class-action status from a federal judge on Monday in a $25 billion lawsuit by former Chief Executive Maurice "Hank" Greenberg over alleged losses caused by the U.S. government's bailout of the insurer. U.S. Court of Federal Claims Judge Thomas Wheeler also appointed Greenberg's lawyer, David Boies, of Boies, Schiller & Flexner LLP, as lead counsel for the classes. Greenberg's Starr International Co, once AIG's largest shareholder with a 12 percent stake, sued the United States in 2011 over what eventually became a $182.3 billion bailout for the New York-based insurer. It said that by taking a 79.9 percent AIG stake and then conducting a reverse stock split without letting existing shareholders vote, the government conducted an illegal taking that violated the 5th Amendment of the U.S. Constitution. Citing Boies' estimate that "tens of thousands" of shareholders might be affected, Wheeler said "class certification is by far the most efficient method of adjudicating these claims." Both Sides Of SEC Nominee Face Heat (WSJ) In one version, Ms. White is a no-holds-barred crime fighter known for stretching the law to jail mob bosses and international terrorists. In another, Ms. White is a friend of Wall Street who worked for the past decade for the law firm Debevoise & Plimpton LLP, where she represented giant banks such as J.P. Morgan Chase. Blackstone: We're Betting Big On Residential Real Estate (CNBC) "Blackstone is now the largest owner of individual houses in the United States," Schwarzman told CNBC's "Squawk on the Street" Monday, pointing to his company's $3 billion portfolio of residential real estate. But given the nascent recovery in the housing market, they're not buying and selling them quickly but rather renting them out. "It's a good business for us. It's a new thing, but it's also good for America," he said. Icahn Gets Confidential Look At Feds Books (Reuters) Dell Inc has agreed to give Carl Icahn a closer look at its books, less than a week after the activist investor joined a growing chorus of opposition to founder Michael Dell's plan to take the world's No. 3 personal computer maker private...A source with knowledge of the situation said Icahn's and Dell's confidentiality agreement does not have a contractual "standstill" obligation - meaning he is not obligated to stop trading stock in the company. But the activist investor would not be able to trade the stock while he is privy to non-public information in any case, the source added. Phoenix society gives gator happier life with prosthesis (AZC) The alligator is Mr. Stubbs, who is part science project, part human endeavor, and much more. He’s also half-gator, half-rubber. The 11-year-old crocodilian now sports a 3-foot-long prosthetic tail, attached firmly with nylon straps. It replaces the original, which was bitten off more than eight years ago. As far as anyone at the Phoenix Herpetological Society knows, Mr. Stubbs is the first alligator to tolerate, if not sport, a prosthesis. It will take months, however, before Mr. Stubbs learns how to properly use the tail. For now, handlers are happy with smaller milestones. “The fact he doesn’t try to bite it (the tail) is a good sign,” said Russ Johnson, president of the Phoenix Herpetological Society. “Learning how to use it is going to take a lot of training.” The months-long project was overseen by someone well-versed in anatomy. Marc Jacofsky is executive vice president of research and development at the CORE Institute in Phoenix, which specializes in orthopedic care — for humans. While visiting the Herpetological Society, Jacofsky was asked if it would be possible to make an artificial tail for Mr. Stubbs. “I looked and saw there was enough there that we could probably do something that wouldn’t involve surgery,” Jacofsky said. “I also liked the idea because it would improve his life. Our motto at the CORE Institute is ‘Keep life in motion,’ and this certainly fit in with that. I was on board.” Jacofsky estimated the project has cost the Core Institute about $6,000 in donated labor and materials. Mr. Stubbs had been a project since shortly after arriving at the center in May 2005. The then-3-year-old gator was one of 32 confiscated from the back of a truck pulled over near Casa Grande, Johnson said. Officers called in the Arizona Game and Fish Department as soon as the cargo made its presence known. “Scared the heck out of the officer,” Johnson said. “No one expects to find alligators when you look into the back of a truck.” Greece Faces 150,000 Job-Cut Hurdle to Aid Payment (Bloomberg) Greece is locked in talks with international creditors in Athens about shrinking the government workforce by enough to keep bailout payments flowing. Identifying redundant positions and putting in place a system that will lead to mandatory exits for about 150,000 civil servants by 2015 is a so-called milestone that will determine whether the country gets a 2.8 billion-euro ($3.6 billion) aid instalment due this month. More than a week of talks on that has so far failed to clinch an agreement. Failed Sale Of Gleacher Is A Warning For Directors (WSJ) The Dell drama is still unfolding, but for a cautionary tale of how boards, even when they may be well-intentioned, can harm investors of a takeover target, take Gleacher. Shares in the small investment bank have lost more than 60% in the past year as the prospects for a deal evaporated, business dwindled and star traders left. Ironically for a firm that bears the name of Eric Gleacher, who made his name advising on big deals in the 1980s, the company failed to sell itself. At least as some critics see it, its independent directors are to blame. SEC Says Illinois Hid Pension Troubles (WSJ) For years, Illinois officials misled investors and shortchanged the state pension system, leaving future generations of taxpayers to foot the bill, U.S. securities regulators allege. The Securities and Exchange Commission on Monday charged Illinois with securities fraud, marking only the second time the agency has filed civil-fraud charges against a state. Bernanke Provokes Mystery Over Fed Stimulus Exit (Bloomberg) When Ben S. Bernanke asserted last month that the Federal Reserve doesn’t ever have to sell assets, he raised questions about how the central bank can withdraw its record monetary stimulus without stoking inflation. The Fed may decide to hold the bonds on its balance sheet to maturity as part of a review of the exit strategy Bernanke expects will be done “sometime soon,” he told lawmakers in Washington on Feb. 27. This would help address concerns that dumping assets on the market will lead to a rapid rise in borrowing costs. It also allows the Fed to avoid realizing losses on its bond holdings as interest rates climb. Man shot in buttocks at Calle Ocho Festival unaware he was wounded (Miami Herald) The shooting occurred around 4:30 p.m. as the man walked along Southwest Eighth Street and 11th Avenue, part of the throng of revelers who gather annually at the street festival in Little Havana. It’s unclear if something sparked the violence between the two men, or if the shooting was unprovoked. At first the victim did not realize he had been shot and kept strolling along the festival route. “He discovered later that he was bleeding and then passed out,” said Miami police spokesman Sgt. Freddie Cruz. The victim, who was hit in the left buttocks, was taken to Jackson Memorial Hospital, where he is in stable condition and expected to recover.

Opening Bell: 08.22.12

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