Opening Bell: 4.19.17

Morgan Stanley does victory lap around Goldman; Treasury Department wants your opinion on century bonds; which emoji makes the best sex toy?; and more.
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Morgan Stanley Beats Estimates as Fixed-Income Revenue Doubles (BBG)
“We reported one of our strongest quarters in recent years,” Chief Executive Officer James Gorman said in the statement. “All our businesses performed well in improved market conditions. We are confident in our business model and the opportunities ahead, while recognizing that the environment remains uncertain.”

Economist Zandi, who predicted a 'lengthy recession' under Trump, changes his tune (CNBC)
"Trump detractors who believe the new president will quickly drive the economy into a ditch are overly pessimistic," he said. "Sustained economic growth is possible, but will require that Trump supporters and detractors find a way to work together."

Aaron Hernandez, Former New England Patriots Star, Found Dead in Prison Cell (NBC)
Correction officers discovered Hernandez hanged by a bed sheet attached to his cell window at about 3:05 a.m., said Christopher M. Fallon, assistant deputy commissioner of communications for the state Department of Correction. The former football star had attempted to "block his door from the inside by jamming the door with various items," Fallon said in a statement.

Former Harvard Money Whiz Jack Meyer Tries to Regain Midas Touch (WSJ)
Jack Meyer says he used to think 80% of active managers didn’t add value but now thinks it is closer to 95%. Convexity is in that remaining 5%, he said.

US Treasury tests appetite for ‘ultra-long’ bonds (FT)
The Treasury survey focused on the following areas: “What factors should Treasury consider when structuring a security with a maturity greater than 30 years (eg, 40-, 50- or 100-year)? At what price, relative to the current 30-year bond offering, could Treasury reasonably expect an ultra-long to price?”

Here’s Where London Bankers Are Moving After Brexit (BBG)
TheCityUK lobby group forecasts that as many 70,000 financial services jobs are at risk, though estimates vary widely. The implications for the U.K. are potentially substantial: finance and related professional services bring in some £190 billion ($240 billion) a year, representing 12 percent of the British economy.

Bill O’Reilly’s Future at Fox Grows Dim as the Murdochs’ Support Erodes (NYT)
The woman reported that in 2008, Mr. O’Reilly would stop by her desk and grunt like a “wild boar”; he would also stand back to allow her to exit the elevator first and then say, “Looking good, girl,” Ms. Bloom said. Mr. O’Reilly leered at the woman’s cleavage and legs and called her “hot chocolate,” Ms. Bloom said.

A history of global living conditions in 5 charts (Our World In Data)

Markets Start to Ponder the $13 Trillion Gorilla in the Room (BBG)
Underscoring just how diverse the programs have become, the ECB’s securities purchases have included French yogurt-maker bonds, while the BOJ’s holdings through exchange traded funds include shares of Japan’s top soy-sauce brewer.

Harbert Reaches $40 Million Tax Settlement With New York (NYT)
An investigation by Mr. Schneiderman’s office found that Harbert paid no state taxes on the profits generated by Harbinger from 2004 to 2009, even though the hedge fund and Mr. Falcone were based in Manhattan. “Harbert Management made a clear choice to skirt the rules, and as a result, ordinary New York taxpayers were left footing the bill,” Mr. Schneiderman said.

How Google eats a business whole (The Outline)
“It’s a big ask. Like, ‘hey, let us tap into the most valuable thing that you have, that has taken years to create and we’ve spent literally millions of dollars, and just give it to us for free so we can display it.’ At the end of it, we just said ‘look, we’re not comfortable with this.’ But then they went ahead and took the data anyway.”

The Eggplant Emoji Has Found Its True Purpose As A Vibrator (HuffPo)
As for which toy is more in demand, the eggplant may be the original emojibator, but the chili sex toy is quickly eclipsing it in popularity. “We’ve actually heard more and more that the chili pepper is the preferred stimulator,” Jandler said. “It’s curved shape and flexible tip allow for increased pleasure.”

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Opening Bell: 7.20.17

Goldman is losing ground to Morgan Stanley; John Cryan sees a hard Brexit coming; doctors found 27 contact lenses in some lady's eye; 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: 06.12.13

Pimco Sees 60% Chance of Global Recession in Five Years (Bloomberg) Pacific Investment Management Co., the world’s largest active bond manager, said investors should cut risk amid a more than 60 percent chance of a global recession in the next three to five years. Global growth will slow, keeping inflation in check, and “economic volatility” will increase, Saumil Parikh, a portfolio manager at Newport Beach, California-based Pimco, said in a report being posted on the firm’s website today. Investors shouldn’t add risk in the search for yield, he said. “The global economy experiences a recession every six years or so, and the frequency of global recessions tends to increase when global indebtedness is high and falling as opposed to when indebtedness is low and rising,” Parikh, who focuses on asset allocation, multisector fixed income and absolute-return portfolios, said in the report. The last global recession was four years ago, he said. Banks Get Reprieve on New Swaps Rule (WSJ) Some of biggest banks on Wall Street will get an additional two years to comply with a post-financial crisis rule requiring they move risky swap activities into separate affiliates. The Office of the Comptroller of the Currency said it granted extensions to seven banks, giving them until July 2015 to comply with so-called "swaps push-out" rules required by the 2010 Dodd-Frank law. ... The OCC notified Bank of America Corp., J.P. Morgan Chase & Co., Citigroup Inc., Wells Fargo & Co., HSBC Holdings PLC, Morgan Stanley and U.S. Bancorp that they were granted a 24-month extension in response to their requests for a longer transition period. The move comes less than a week after the Federal Reserve said foreign banks also will be eligible for the two-year delay in complying with the rule, which is slated to take effect July 16. Emerging market assets suffer in fierce sell-off (FT) Emerging economies have been among the prime beneficiaries of ultra-loose global monetary policy as central banks led by the Fed have flooded financial markets with more than $12tn of extra liquidity since the financial crisis. But signs of an economic slowdown spreading from China and indications that the Fed could reduce the pace of its $85bn-a-month bond purchases have triggered a sharp correction in emerging markets. The South African rand and the Brazilian real touched four-year lows against the US dollar on Tuesday, and the Indian rupee fell to a record low. Even relatively robust countries like the Philippines and Mexico – long favourites of investors – have been hit by a spate of selling. Some central banks have begun to intervene to stem the currency slides. Is U.S. stock trading safer? Fewer erroneous trades seen (Reuters) More than three years after the "flash crash" terrified many by temporarily wiping out almost $1 trillion of U.S. stock market value in a few minutes, there are signs that the number of erroneous and aberrant trades is dropping. The use of circuit breakers for individual securities in the wake of the May 6, 2010 plunge, and the introduction of tougher risk-management controls for broker-dealers in November 2010 appear to have helped stabilize trading, market experts and regulators said. The Financial Industry Regulatory Authority, the security industry's watchdog, said the number of reports of "clearly erroneous" trades it received was down 84 percent in the last six months of 2012 compared with the first six months of 2009. Facebook Investors Press Zuckerberg on Stock Price at Annual Meeting (CNBC) Facebook CEO Mark Zuckerberg tried to tackle concerns about its stock head-on at the first annual shareholder meeting Tuesday, but investors pressed for answers about why the price is still down a year after the company went public. "The answer is we understand that a lot of people are disappointed with the performance of the stock, and we really are, too," Zuckerberg said in his opening remarks before taking questions. ... The stock, priced at $38 when the company went public in May 2012, hit $17 a few months ago and was trading at about $24 in afternoon trading Friday. Facebook can't control the stock price but is focused on developing the best products to create more shareholder value, Zuckerberg said. NJ Mayor Apologizes for Calling Residents "Annoying" (NBC) The mayor of Toms River apologized Tuesday night for comments he made about an area battered by Sandy, but not all residents were satisfied. Last week, Mayor Thomas Kelaher told Bloomberg News that he thought residents of Ortley Beach, where many are still without homes, were "annoying." "I certainly never intended to be disrespectful to the people who live in Ortley beach," Kelaher said at a meeting Tuesday. Marketfield Poet-Philosopher Pair Bet Europe for Top Fund (Bloomberg) Michael Aronstein, a poet, and Michael Shaoul, a doctor of philosophy, have made their MainStay Marketfield Fund the world’s fastest-growing by anticipating recoveries in the most-hated assets. Marketfield grew more than five-fold to $9.5 billion in the past year, the biggest increase of a fund with more than $5 billion in assets, after betting on a rebound in U.S. housing stocks and European shares. Now, their success relies on Irish and Italian stocks rallying and equities in China , Brazil and India tumbling. The New York-based fund has advanced 70 percent since July 2007, more than triple the return of the Standard & Poor’s 500 Index, data compiled by Bloomberg show. “I don’t know where the level is,” Aronstein, a former Merrill Lynch strategist who writes poetry in his spare time, said of the potential for further declines in developing nations’ stocks in an interview April 4. “But if we are right, it’s going to get to the point where people cannot stand it anymore.” Metacapital in Worst Slide as Bloodbath Roils Funds (Bloomberg) Deepak Narula rose to fame as manager of the best-performing hedge fund last year by navigating the government’s stimulus efforts. He’s having a far harder time as the Federal Reserve moves closer to an exit. Metacapital Management LP’s flagship $1.5 billion fund lost an estimated 6.4 percent last month, the worst decline since it started in 2008, according to a letter to investors obtained by Bloomberg News. That followed drops of 0.5 percent in April and 0.1 percent in March, after 17 months of consecutive gains including a 41 percent return last year. ... “It’s been a bloodbath the last four to six weeks,” said Troy Gayeski, a senior portfolio manager who helps invest client money in hedge funds at SkyBridge Capital, which manages about $7.7 billion. “It was a confluence of just about everything” from investors’ concerns that refinancing would pick up among some borrowers who’ve had trouble qualifying to the slump in the mortgage debt that the Fed is buying, he said. SoftBank's Son Felt Time Pressure to Push Sprint Deal Forward (WSJ) In the end, SoftBank Corp. Chief Executive Masayoshi Son concluded that time was money. After a weekend of wheeling and dealing, he was willing to sweeten the Japanese company's bid for Sprint Nextel Corp. that Mr. Son for weeks had been saying already was high enough. His hope with the new bid is to keep the acquisition on track for midsummer completion and resolve complications raised by a rival offer. Mr. Son agreed for SoftBank to throw another $1.5 billion on top of the $20.1 billion already offered to achieve the "certainty of timing" for closing the deal in early July, a person familiar with the new proposal said. Pattern of negative correlation between HY bonds and treasuries has been broken (Sober Look) Since the financial crisis, the correlation between treasuries and many credit assets such as high yield bonds (HY) has been strongly negative. ... Recent events however broke that pattern. We've had a number of days with both the longer dated treasuries and HY selling off. That means the HY asset class is now responding to rate moves (not just spread). The 3-month correlation between prices of longer dated treasuries and HY bonds is nearing zero. This move toward a "less negative" correlation with treasuries is also visible in other credit assets as well. Sub-investment-grade credit investors are all of a sudden paying much closer attention to rates. US warns EU against exempting film industry from trade talks (FT) The US government has warned Brussels that EU efforts to placate French demands to exempt its film industry from high-profile transatlantic trade talks could unleash a torrent of demands in Washington for similar reciprocal carve-outs that would imperil a comprehensive deal. ... José Manuel Barroso, the European Commission president, met European filmmakers on Tuesday, including “The Artist” star Bérénice Bejo, to reassure them the trade deal will not jeopardise their protections. “Let me state loud and clear: the cultural exception is not negotiable,” Mr Barroso said after the meeting. Most Americans Aren’t Excited About Their Jobs (WSJ) FYI. State Dept. officials deny prostitution cover-up allegations (CBS) The allegations were first brought to light by CBS News' John Miller, who reported that according to an internal State Department Inspector General's memo, several recent investigations were influenced, manipulated, or simply called off. One specific example mentioned in the memo refers to the 2011 investigation into an ambassador who "routinely ditched ... his protective security detail," and inspectors suspect this was in order to "solicit sexual favors from prostitutes." ... In response to the allegation, Gutman said on Tuesday: "I am angered and saddened by the baseless allegations that have appeared in the press and to watch the four years I have proudly served in Belgium smeared is devastating. I live on a beautiful park in Brussels that you walk through to get to many locations and at no point have I ever engaged in any improper activity."