Updated:
Original:

Opening Bell: 3.27.17

Robert Rubin's proteges stumble; "Project Scalpel" looms over Wall Street; "GRABHER" apparently not an acceptable license plate; and more.
Robert Rubin (Getty Images)

Robert Rubin (Getty Images)

Once golden, Robert Rubin's hedge fund proteges lose some luster (Reuters)
Goldman, for decades Wall Street's pre-eminent investment bank, no longer breeds such hedge fund scions because regulations brought in after the 2008 financial crisis - chiefly designed to reduce risk - have inhibited the type of trading it can do. "The old ways of hedge funds taking money out of the markets just are not as effective anymore," said Shakil Riaz, global chief investment officer for Rothschild Asset Management. "It really is an evolve-or-die world."

Reviving Deutsche Bank in US is priority for CEO John Cryan (FT)
One top banker at Morgan Stanley notes that Deutsche’s revenues from debt trading in the fourth quarter came to €1.38bn, in line with Morgan Stanley’s own. “But that’s their strongest business — and it’s our weakest,” he says.

A Correction Now Might Not Be So Bad, Some Investors Say (WSJ)
“It’s like dental work,” said Michael Farr, president of the money management firm Farr, Miller & Washington. “You dread it. You don’t want to get it. But you’re glad when it’s over and you feel better.”

Uber to Suspend Autonomous Tests After Arizona Accident (BBG)
In a photo posted on Twitter, one of Uber’s Volvo self-driving SUVs is pictured on its side next to another car with dents and smashed windows. An Uber spokeswoman confirmed the incident, and the veracity of the photo, and added that the ride-hailing company is suspending its autonomous tests in Arizona until it completes its investigation and pausing its Pittsburgh operations.

One CEO Got Paid $46 Million in a Month, but the Rest of the Year Is a Mystery (WSJ)
“Essentially, the rules provide that if you are an executive at an acquired company and your company goes away in the transaction, the compensation that was paid to you by your original company, it just evaporates,” said Mark Borges, a pay consultant with Compensia Inc. and a former special counsel in the SEC division that polices corporate disclosure.

Hedge Funds Are Training Their Computers to Think Like You (BBG)
Hedge funds lag in deploying deep learning because they lack expertise in applying it to complex financial data. Facebook Inc.’s image recognition -- the ability to identify a dog in a photo, for instance -- has succeeded because it draws on unlimited amounts of data, with fixed points like pixels, uploaded by social media users. Market data, on the other hand, is limited and constantly changing, making predictions of events like stock moves more challenging.

‘Project Scalpel’: Behind Big Banks’ Plan to Save $2 Billion (WSJ)
One effort, dubbed “Project Scalpel,” is aimed at cutting the administrative and operational costs involved with processing stock and bond transactions after a trade is struck, according to people familiar with the discussions. Talks around this effort are at an early stage but so far have included a number of banks, such as Goldman Sachs Group Inc., Morgan Stanley and Bank of America Corp., the people said. If the idea materializes, it could create a joint venture that allows banks to share trade processes and technology.

Man Named ‘Grabher’ Is Appalled He Can’t Have A ‘GRABHER’ License Plate (HuffPo)
Lorne Grabher had a vanity plate reading “GRABHER” made for his father in 1991 to honor their German last name. “It was to have our name be put on something and be proud of it,” he said. The plate made its way back to Lorne Grabher’s vehicle, but the Nova Scotia Registry of Motor Vehicles has taken issue with it. Grabher got a letter in December informing him the plate would be canceled because people could “misinterpret it as a socially unacceptable slogan.” Grabher is now accusing the government of “discriminating” against his name.

Related

Getty Images

Opening Bell: 12.21.16

UBS trading floor is a ghost town; Wall Street corners the blockchain market; horrors from the deep; and more.

Opening Bell: 12.21.15

Tom Hayes catches a break; Martin Shkreli has a theory; Wall Street bucks back against Cuomo; Han Solo: Uber driver

Opening Bell: 04.18.13

Morgan Stanley Sees Core Earnings Weaken (WSJ) Morgan Stanley saw core earnings weaken, although the investment bank swung to a first-quarter profit as it benefited from a comparison with a year-earlier period bogged down by a heavy charge. For the quarter, the bank reported a profit of $984 million, compared with a year-earlier loss of $94 million. The per-share profit, which reflects the payment of preferred dividends, was 49 cents compared with a loss of six cents a year earlier. The latest period featured a decline in fixed-income trading revenue, but strong stock trading and continued improvements in Morgan Stanley's wealth-management division, which was buoyed by strong markets. ... Revenue jumped 18% to $8.16 billion. Excluding debt valuation, revenue was $8.48 billion. Analysts polled by Thomson Reuters most recently expected earnings, excluding debt-valuation adjustments, of 57 cents, on revenue of $8.35 billion. Blackstone First-Quarter Profit Rises on Fund Performance (Bloomberg) Blackstone Group LP (BX), the world’s biggest buyout firm, said first-quarter profit rose 28 percent as market gains lifted the carrying value of its holdings. Economic net income, a measure of earnings excluding some costs tied to the firm’s 2007 initial public offering, increased to $628.3 million, or 55 cents a share, from $491.2 million, or 44 cents, a year earlier, New York-based Blackstone said today in a statement. Analysts had expected earnings of 53 cents a share, according to the average of 15 estimates in a Bloomberg survey. Barclays Head of Investment Banking Rich Ricci to Retire in June (Bloomberg) Barclays Plc’s Rich Ricci, the head of investment banking and one of the last members of former Chief Executive Officer Robert Diamond’s management team, will retire at the end of June. Ricci, 49, will be replaced by Eric Bommensath and Tom King, 52, as co-chief executive officers of corporate and investment banking in May, the London-based bank said in a statement today. “The market will see this as an inevitable and appropriate piece of transitioning,” said Ian Gordon, an analyst at Investec Plc (INVP) in London. “Few tears will be shed and the reshuffle will be broadly welcomed.” Special Report: The battle for the Swiss soul (Reuters) A sign on display in UBS's museum, from a bank founded in 1747 in the Italian-speaking part of Switzerland, could almost be Switzerland's mantra: "MASSIMA DISCREZIONE" it promises. Swiss bankers have long adhered to an unwritten code similar to that observed by doctors or priests. Bankers do not acknowledge clients in public for fear of exposing them as account holders; they often carry business cards with just a name, rather than bank or contact details; and, at least until the 1990s, they never advertised abroad. ... Even today, few Swiss like to discuss the fact that much of the country's prosperity was built on bankers helping foreigners evade taxes. Visitors should avoid personal questions, advises Communicaid, a consultancy which advises businesses on cross-cultural awareness. It would also be wise to steer clear of discussing "Swiss banks, money or Switzerland's military role in World War One or Two." Reinhart/Rogoff and Growth in a Time Before Debt (RortyBomb via Felix Salmon) Here is a simple question: does a high debt-to-GDP ratio better predict future growth rates, or past ones? If the former is true, it would be consistent with the argument that higher debt levels cause growth to fall. On the other hand, if higher debt "predicts" past growth, that is a signature of reverse causality. ... As is evident, current period debt-to-GDP is a pretty poor predictor of future GDP growth at debt-to-GDP ratios of 30 or greater—the range where one might expect to find a tipping point dynamic. But it does a great job predicting past growth. Ottawa sets up taxpayer-funded food truck in Mexico to promote Canadian cuisine (National Post) When author Anita Stewart first heard about the Canadian government’s new food truck parked in Mexico City, she laughed so hard she cried. The new Canada-branded, taxpayer-funded venture, which kicked off its three-week pilot project last week, is serving up a Mexican-ized version of poutine, using Oaxaca cheese instead of curds. Also on the menu are Alberta beef tourtière, and maple-glazed Albacore tuna. China Vows Wider Yuan Movement (WSJ) China's central bank plans to widen the yuan's trading band in the near future, People's Bank of China Vice Governor Yi Gang said Wednesday, suggesting that China's leaders will press ahead with change despite the surprise slowing of the economy. "The exchange rate is going to be more market-oriented," Mr. Yi said on a panel at the International Monetary Fund spring meetings in Washington. "I think in the near future we are going to increase the floating band even further." IMF warns on risks of excessive easing (FT) Extraordinarily loose monetary policy risks sparking credit bubbles that threaten to tip the world back into financial crisis, the International Monetary Fund warned on Wednesday. In its global financial stability report, the fund cautioned that policy reforms were needed urgently to restore long-term health to the financial system before the long-term dangers of monetary stimulus materialised. German Parliament Approves Bailout for Cyprus (WSJ) German Finance Minister Wolfgang Schäuble called the vote a "strong signal" by Germany in favor of the euro and the euro zone. The parliament also voted in favor of a seven-year extension of the maturity on European Financial Stability Facility loans for Ireland and Portugal with a large majority. SEC to Move Past Financial Crisis Cases Under New Chairman White (Bloomberg) Mary Jo White, the first former prosecutor to serve as chairman of the U.S. Securities and Exchange Commission, has pledged to run a “bold and unrelenting” enforcement program at the agency charged with regulating Wall Street. With financial crisis cases mostly done and some of the biggest insider-trading cases in history closed, White will have to chart a course into new areas to keep that pledge. White, who was sworn in last week, has already provided a few signals about what that might be. During her Senate confirmation hearing, she said she intends to focus on high- frequency and automated trading. She has also raised questions about a drop in the number of accounting fraud cases the agency has brought in recent years. Dispute in Hamptons Set Off by Effort to Hold Back Ocean (NYT) Soon after Hurricane Sandy hit last fall, Joshua Harris, a billionaire hedge fund founder and an owner of the Philadelphia 76ers, began to fear that his $25 million home on the water in Southampton might fall victim to the next major storm. So he installed a costly defense against incoming waves: a shield of large metal plates on the beach, camouflaged by sand. His neighbor, Mark Rachesky, another billionaire hedge fund founder, put up similar fortifications between his home and the surf. Chris Shumway, who closed his $8 billion hedge fund two years ago, trucked in boulders the size of Volkswagens. Across a section of this wealthy town, some residents, accustomed to having their way in the business world, are now trying to hold back the ocean. ‘Elvis’ is busted in ricin terror (NYP) The FBI last night busted a troubled Mississippi Elvis impersonator as the poison-wielding man who mailed ricin-laced letters to President Obama and two other officials. ... Despite his rock ’n’ roll hobby, Curtis shows his angry side on Facebook, where he lashes out in a conspiracy-filled rant. “I’m on the hidden front lines of a secret war,” he wrote. “They burned down my home, killed my dogs, my cat, my rabbit, blew up my 1966 Plymouth Valiant . . . and guess what? I am still a thorn in their corrupt anals! I will remain here until Jesus Christ decides it’s time for me to go.”

Opening Bell: 4.14.15

JP Morgan earnings; Wells Fargo earnings; Blythe Masters is hiring; 'Nam vet denied 69 license plate; and more.

By Paul Elledge Photography [CC BY-SA 3.0], via Wikimedia Commons

Opening Bell: 10.18.16

Goldman tops expectations; Hillary would maybe be tough on Wall Street; David Tepper says one person running for president "may be demented, narcissistic and a scumbag"; and more.

(Getty Images)

Opening Bell: 12.20.17

The Winklevii have been officially redeemed; the bond trader bonus doughnut; Wall Street is ambivalent on the tax bill; insider trading at Coinbase?; drive-thru funerals; and more.

GoldmanSnapchat

Opening Bell: 3.31.17

Wall Street loves its messaging apps; Eddie Lampert is going down with the ship; this is James Comey's Twitter account; and more.

Opening Bell: 6.16.15

Tsipras says ECB is choking him; 'WALL ST' vanity plate could be yours for 12k; Derek Jeter gets funding; "Financier in harassment suit lasted 2 minutes in bed"; and more.