Opening Bell: 5.11.17

Tax reform is headed the way of the Comey; hedge fund traders probed for fibbing about bonds; porn star vs sharks, round two; and more.
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Comey Firing Distracts Trump White House, Putting Agenda at Risk (BBG)
Democrats, furious over the firing even though many of them had lambasted Comey for publicly discussing the FBI’s investigation of Hillary Clinton last year, predicted legislative work would cease. "Senate needs to focus on the constitutional crisis Trump created, not business as usual," Senator Jeff Merkley, an Oregon Democrat, said on Twitter.

‘Brexit’ Imperils London’s Claim as Banker to the Planet (NYT)
On a recent afternoon at Citigroup’s headquarters, traders sit at banks of computer screens watching prices in markets scattered from Shanghai to São Paulo. A Swedish trader helps a money manager in Paris place a complicated bet that German government bonds will fall. “There’s about 10 questions that immediately come to mind as to whether we could execute that trade in London after Brexit,” Jerome Kemp, Citi’s global head of futures, says.

Hedge Funds Facing U.S. Criminal Probe Over Bond Valuations (BBG)
Having prosecuted traders who lied to customers about bond prices, the government is now scrutinizing hedge funds that allegedly solicited bogus price quotes from brokers, according to three people familiar with the matter who asked not to be identified. Such a practice would have enabled the funds to pump up the value of illiquid securities on their books.

Bond Traders' Bonuses Set to Rise 15% as Banks Resume Big Raises (BBG)
The reversal for bond traders in recent months contrasts with the situation facing some of their biggest clients. Hedge funds and asset managers will generally hold pay flat this year, according to estimates released Wednesday. Both of those groups have cut incentive pay the past few years, the firm’s data show.

The Volcker Rule: How Trump’s New Regulator May Unleash Big Banks (WSJ)
“There’s a lot that can be done” by the five agencies that enforce the rule, acting comptroller of the currency Keith Noreika said. Then he added: “I hope we don’t have to get to this, but there could be things that could be done even by our agency unilaterally if we had to,” such as “reinterpreting what is proprietary trading. [...] The ultimate problem with the Volcker rule is no one knows what prop trading is,” he said.

The Best Unknown Indicator (Macro Tourist)
Over the years I have learned the hard way not to fade Yardeni’s model. It doesn’t mean stocks cannot decline, but until I see either the industrial commodities roll over (and not just Chinese Iron ore), or employment claims skyrocket, I will avoid calling for a big crash. It’s tough for me to put this down on paper, but really, the proper bet is to assume Yardeni’s model will once again prove correct, and buy stocks.

Whole Foods announces new CFO amid board shakeup (NYP)
Just one month after Barry Rosenstein’s activist hedge fund Jana Partners announced an 8.3 percent stake in Whole Foods, the high-end grocer on Wednesday announced a laundry list of changes — including a new chief financialofficer and five new board members.

Transcript: Interview with Donald Trump (Economist)
TRUMP: Have you heard that expression before, for this particular type of an event?
THE ECONOMIST: Priming the pump?
TRUMP: Yeah, have you heard it?
ECONOMIST: Yes.
TRUMP: Have you heard that expression used before? Because I haven’t heard it. I mean, I just… I came up with it a couple of days ago and I thought it was good. It’s what you have to do.
ECONOMIST: It’s…
TRUMP: Yeah, what you have to do is you have to put something in before you can get something out.

Trump Administration, Senators Put Fannie, Freddie Overhaul Back in Play (WSJ)
The Senate Banking Committee has begun behind-the-scenes work on the issue of how, exactly, to revamp the companies. The senators want to develop a framework to decrease the government’s outsize role backstopping the nation’s $10 trillion mortgage market. On Thursday, the panel will hear testimony from Mel Watt, the director of the Federal Housing Finance Agency, which controls Fannie and Freddie, in the first step of a process that could play out in the coming months.

Porn Star Molly Cavalli Accused Of Faking Shark Attack For Viral Glory (HuffPo)
Bryce Rohrer, owner and operator of Florida Shark Diving, told the Palm Beach Post that Cavalli and her crew contacted him two months ago about doing a shark dive and faking an injury. “I was talking directly to Molly and she just said, ‘Hey, we are looking to do a shoot faking a shark bite and it’s strictly in order for it to go viral,’” Rohrer said. “We immediately declined. We are pro-shark, pro-wildlife, and want to show the importance of sharks, not villainize them.”

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Opening Bell: 3.28.17

Trump tax reform plan starting to look familiar; what we can learn from hedge fund closures; "I wuv you, wobot"; and more.

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Opening Bell: 12.13.17

Big upset in Alabama senate race; Google looms over Fidelity; bitcoin shorts only cost you 5x leverage; Dina Powell eyes a return to Goldman; don't check your phone while running from the police; and more.

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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.

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Opening Bell: 12.6.17

Brian Moynihan is feeling glum again; tax lawyers are licking their chops in advance of tax reform; wherefore art thou, buybacks?; beware the dreaded coywolf; and more.

Opening Bell: 4.9.15

Blankfein bet pays off; Activist food fight; HSBC faces (another!) criminal investigation; Bobcat vs shark; and more.

Opening Bell: 04.03.13

Barclays High-Pay Culture Brought Disrepute: Report (WSJ) Barclays PLC suffered from "a lack of self-awareness" in recent years as a culture of high pay and short-term incentives brought the bank into disrepute, according to an independent report by lawyer and investment banker Anthony Salz. The Salz Review, which was commissioned by Barclays' former chairman after the bank admitted to trying to rig interbank interest rates last summer, describes how in about 10 years the lender expanded to become a disparate set of businesses, each with its own culture. "The result of this growth was that Barclays became complex to manage," the report published Wednesday said. "Despite some attempts to establish group-wide values, the culture that emerged tended to favor transactions over relationships, the short term over sustainability, and financial over other business purposes." The 235-page report—which cost Barclays about £17 million ($25.7 million) to have produced—recommended a series of reforms aimed at trying to foster a common sense of purpose across the bank. To this end, Barclays' board must play a more active role in overseeing the business and Barclays' human resources department must be given more power to stand up on issues such as pay, the report said. Ex-Goldman Sachs Trader Taylor Said to Surrender to FBI (Bloomberg) Former Goldman Sachs Group Inc. traderMatthew Taylor planned to surrender today to the Federal Bureau of Investigation, a person familiar with the matter said. Taylor was accused Nov. 8 by the U.S. Commodity Futures Trading Commission of concealing an $8.3 billion position in 2007 that caused New York-based Goldman Sachs to lose $118 million. Morgan Stanley hired Taylor in March 2008, less than three months after Goldman Sachs disclosed in a public filing that he had been fired for building an “inappropriately large” proprietary trading position. Cyprus Bailout Details Emerge After IMF Deal (WSJ) The IMF statement set out the tough terms the tiny nation of 800,000 has to meet to get the bailout, calling the task ahead "challenging." Cyprus, an economy of roughly €17 billion in annual output, needs to push through cuts and savings worth 4.5% of gross domestic product by 2018 to hit a primary-surplus target of 4% of GDP outlined in the bailout deal, the IMF statement said. These cuts will come on top of savings worth 5% of GDP the government is already implementing through to 2015. An extra 2% of GDP in extra revenue will come from an increase in the country's corporate tax from 10% to 12.5% and an increase in the tax on interest income from 15% to 30%. The country's corporate-tax rate will remain among the lowest in Europe, on an equal footing with Ireland's, and will allow Cyprus to continue to use its tax regime to attract businesses, but the increase in withholding tax will make it substantially less attractive as a place for individuals to leave their savings. Cyprus Leader Invites Family Firm Probe (FT) Cyprus president Nicos Anastasiades has urged judges investigating the country's banking disaster to examine transactions handled by his family law firm as "a priority" in a bid to defuse public anger over last-minute transfers by well-connected Cypriots, Russians and Ukrainians who thereby avoided a "haircut" on their uninsured deposits. The move followed questions over whether a company managed by the president's son-in-law made use of inside information to transfer more than 20 million euros out of Laiki Bank days before its collapse. Marc Lasry In French Follies (NYP) Lasry, the CEO and co-founder of Avenue Capital, is on his way to getting a plum assignment as the US ambassador to France as a reward for his many years as a big Democratic fundraiser. But the Moroccan-born, French-speaking American could encounter some uncomfortable moments when he lands in Paris, given his views on the land of fine wine, crusty baguettes — and European socialism. “We don’t invest in France,” he said at a New York hedge-fund conference sponsored by French bank BNP in June 2010, even apologizing to his hosts as he made the comment. Lasry, who is a bankruptcy lawyer by training, loves to chide other countries for their creditor-unfriendly ways. His $11.7 billion distressed debt fund buys up beaten-down credits of companies headed towards bankruptcy, with the payout determined by their ranking in the process. That can be dicey in countries like France, he explained at the BNP conference, as “the legal system is very much tilted towards helping unions and workers.” As a result, he said, “you might find your claim disallowed.” 1,000 pot plants seized in Queens in warehouse raid (NYDN) A massive drug operation went up in smoke Tuesday when law enforcement officials raided an indoor marijuana farm in Queens. Authorities seized more than 1,000 pot plants - along with grow lights and other gear - from the 44th Rd. warehouse in Long Island City just after 3 p.m. , police sources said. Officials from the NYPD, state police and the federal Drug Enforcement Agency also rounded up five suspects in the sweep. New York-for-Buenos Aires Swap Theory Spreads: Argentina Credit (Bloomberg) Argentina’s refusal to improve its offer to holders of defaulted debt suing for full payment in the U.S. is deepening speculation that the nation will sever ties with the overseas bond market. The proposal submitted on March 29 mimics the terms of Argentina’s 2005 and 2010 debt exchanges, a move that could lead to a default on the restructured notes unless the country removes them from U.S. jurisdiction. BofA Chief Moynihan Said to Summon Managers for Revenue Push (Bloomberg) Bank of America Corp. Chief Executive Officer Brian T. Moynihan has summoned more than 100 of his regional leaders to a private meeting today where they’ll be pushed to boost the lender’s flagging revenue, said two people with direct knowledge of the project. Managers at the two-day event in Chicago will be judged on how much progress they’ve made in helping to sell more products to the 53 million customers of the second-biggest U.S. lender, said the people, who asked for anonymity because Moynihan’s plan hasn’t been made public. Revenue has dropped every year of Moynihan’s three-year tenure as he sold assets, repaired the firm’s balance sheet and settled more than $40 billion in claims tied to defective mortgages. Private Sector Adds 158,000 Jobs (WSJ) Economists surveyed by Dow Jones Newswires expected ADP to report a gain of 192,000 private jobs. However, the February job gain was revised up to 237,000 from 198,000 reported a month ago. SEC Embraces Social Media (WSJ) In a ruling that portends changes to how companies communicate with investors, the Securities and Exchange Commission said Tuesday that postings on sites such as Facebook and Twitter are just as good as news releases and company websites as long as the companies have told investors which outlets they intend to use. Gray seal pup saved from death on Montauk beach now recovering (NYDN) The three-month-old seal, underweight at 40 pounds, is now resting in one of the foundation's rehabilitation tanks at the Atlantic Marine World aquarium in Riverhead. "She feels very sassy in her tank and doesn't appreciate anything we are doing for her," laughed Kimberly Durham, director of the rescue program, "which is a good sign. A nasty seal is a good sign that she is getting better because they are wild animals.

Opening Bell: 2.12.16

Pimco bets on battered banks; AIG avoids wrath of Icahn; Deutsche buys back; Ted Cruz yanks ad featuring porn star; and more.

trump-djia

Opening Bell: 5.17.17

Markets are and are not reacting to Trump-Comey news; Elon Musk's Boring Company revealed; porn is a scourge on our nation's capital; and more.