Opening Bell: 10.10.17

John Cryan could use a friend, preferably one with a few million Deutsche Bank shares; no Trump Bump in business lending; Richard Thaler, Nobel winner; and more
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Cryan Is Losing Support of Top Deutsche Bank Owners (BBG)
Three of the 10 largest stakeholders in the bank, speaking on condition of anonymity, said they want to see a turnaround in the next few quarters, particularly in the trading business, to continue to back the 56-year-old Briton. Two said that, should Cryan not be able to deliver by the annual shareholder meeting in May, an external candidate may be the best option to replace him.

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What Trump Bump? Businesses Are Confident but They Aren’t Borrowing from Banks (WSJ)
Since Trump’s election, bankers and investors predicted that pro-business policies would lead to a surge in corporate borrowing, which would help bank profits. Instead, the growth of loans to companies has dropped precipitously since last November—to 2.1% from 8.1%. “Everybody thought we were about to catch a wave earlier in the year,” said David Turner, chief financial officer of Regions Financial Corp, at a conference last month. “It didn’t happen.”

ADP retail investors to get a chance to grill Ackman (Reuters)
The online questions-and-answers session, scheduled for 7 p.m., illustrates the important role that non-institutional investors - such as retirees and amateur stock pickers - could play in a spat between Ackman, the chief executive of Pershing Square Capital Management LP, and ADP.

SoftBank deal with Uber encounters delay (FT)
Uber’s major shareholders including Benchmark have declined to waive their rights of first refusal over the upcoming tender offer, a move that has annoyed and confused the buyers involved, according to four people close to the talks. The SoftBank-led group has not yet named its price for the secondary shares, and dozens of major shareholders technically have a right of first refusal over the purchase.

The Smartest Americans Are Heading West as Computer Chips Replace Cow Chips (BBG)
Three cities in Colorado — a state whose fortunes have been tied to the boom and bust of oil, gas and other commodities — are among the top 10 leading destinations for the nation’s best and brightest as old cow and mining towns morph into technology hubs, according to data compiled by Bloomberg. Another Colorado city is plotting a 21st century revival.

2017 Nobel: Richard Thaler (A Fine Theorem)
Thaler’s work is brilliant – it is a rare case of an economist taking psychology seriously and actually coming up with policy-relevant consequences like the 401k policy. But Thaler’s work is also dangerous to young economists who see biases everywhere. Experts in a field, and markets with agents and mechanisms and all the other tricks they develop, are very very good at ferreting out irrationality, and economists core skill lies in not missing those tricks.

Richard Thaler's Savvy, Calculating Insurrection (BBG View)
Unlike a true-blue revolutionary, then, Dick Thaler is not spending his latter years muttering away in an unheated garret. So disappointing! But also so intriguing. For those of us who are suspicious of revolutions and don't want to live in unheated garrets, Thaler's career offers useful pointers on how to bring meaningful change to a large, dispersed organization while not getting thrown out of it.

J.P. Morgan Reigns In 2017 All-America Research Team (II)
JPMorgan Chase once again took the crown for as the best American research firm, with the bank's analysts recognized in 42 of the 60 investment sectors covered in the annual survey of money managers.

Man calls in bomb threat to avoid paying bar tab (AP)
A witness says Clapperton tried to leave multiple times without paying for his meal at Primanti Brothers. Police were called to the scene, and another person paid for Clapperton’s bill. Police say they were about to let the man leave when bomb threat was called in to a nearby restaurant. Authorities say they used a stun gun to subdue Clapperton after he ran from the restaurant.

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Opening Bell: 11.29.12

Blankfein: Seems Like "Fiscal Cliff" Deal Could Be "Reachable" (CNBC) Goldman Sachs CEO Lloyd Blankfein described President Barack Obama's plan for Washington to reach an agreement on the "fiscal cliff" as detailed and "very credible." However, he cautioned that marginal income tax rates may have to rise to seal a deal. In an interview with CNBC after meetings between the president and several CEOs, Blankfein said, of course, it's hard to tell if a deal will be reached but "if I were involved in a negotiation like this, and everybody was purporting to be where they are, I would say that an agreement was reachable." Blankfein said he thought concessions on both the revenue and entitlement sides would be necessary to reach a final deal to avert the fiscal cliff, when large spending cuts and tax increases are slated to take effect on Jan.1. “Look, at the end of the day, the most important value is to get the economy moving forward," Blankfein said. "That’s not going to happen if our budget deficit keeps widening.” He added that the marginal income tax rate may have to rise in order to reach a deal. “I would prefer as low of a marginal rate as possible because it’s the marginal rate that provides the incentive to do incremental work by people, but I’m not dogmatic — I wouldn’t go to the end for that,” he said. Blankfein: "We Can All Be Winners Here" (CNBC) "The most important thing is that we increase the wealth pie of the United States and that we don't reduce it. If we don't sort out our economy people will be fighting over their slice of a shrinking pie. I think we can all be winners here, even those pay a marginally higher rate, or a bigger proportion of revenue, if they are winners, as we all will be, because the economy is improving." Krugman: Fiscal Cliff Is No Way To Run A Country (HP) The Nobel Prize-winning economist expressed his frustration with the government's endless budget wrangling, especially over the so-called fiscal cliff, during a Wednesday interview with WNYC. "It's no way to run a country," Krugman said, referring specifically to the prospect of going over the cliff, a decision that would trigger a series of tax hikes and spending cuts next year, which would probably slow the economy. Given the options though, Krugman admits going over the cliff might be preferable to the likely alternatives. "There is nothing in there [the fiscal cliff] that is going to cause the economy to implode," Krugman said. "Better to go a few months into this thing if necessary than to have a panicked response or to give in to blackmail, which is certainly the question that's facing President Obama." In Krugman's view, the fiscal cliff "has nothing to do with the budget deficit," he added. "This is about a dysfunctional political process. It's about kind of a self-inflicted wound here." Krugman's not alone in his view that jumping over the cliff may be preferable to giving in to Congressional Republicans' demands. Peter Orszag, a former economic adviser to President Barack Obama, and Robert Greenstein, president of the Center on Budget and Policy Priorities, have both said recently that the jumping off the cliff may end up the country's best option. Foreign Banks Rebuffed By Fed (WSJ) Daniel Tarullo, who is responsible for shaping banking policy at the Federal Reserve, said in a speech Wednesday that the central bank will require foreign banks with large U.S. operations to house their U.S. arms in corporate structures that comply with requirements under the Dodd-Frank Act. Mr. Tarullo didn't specify which foreign banks would need to adhere to the new structure. But the change would bring Germany's Deutsche Bank and the U.K.'s Barclays back under a regulatory regime they tried to escape through corporate restructurings. EU Clears Spanish Bank Rescue (WSJ) European Union regulators gave the green light to €37 billion ($47.9 billion) in euro-zone funding for Spain's stricken banking sector on Wednesday, setting in motion a long-term cleanup. In exchange, four nationalized banks agreed to make sharp cuts in their balance sheets and payrolls—a retrenchment that carries the risk of intensifying Spain's credit crunch in the midst of a deep recession. Argentina wins debt reprieve, default averted for now (Reuters) Argentina has won a reprieve against having to pay $1.33 billion next month to "holdout" investors who rejected a restructuring of its defaulted debt and have waged a long legal battle to be paid in full. A U.S. appeals court granted an emergency stay order on Wednesday that gives Argentina more time to fight a debt ruling favoring the holdout creditors and eases investor fears of a new default as early as next month. Last week, U.S. District Judge Thomas Griesa ordered Argentina to deposit the $1.33 billion payment by December 15 for investors who rejected two restructurings of bonds left over from its massive 2002 default. Drunk ‘Bohemian Rhapsody’ singer wears Viking hat to court (Canada) The man who became a YouTube viral sensation for singing “Bohemian Rhapsody” from the back seat of an police cruiser, has been convicted of impaired driving and for refusing to take a breathalyser test. He went to court wearing a Viking hat, sunglasses and NASA T-shirt proclaiming, “I need my space.” He is being forced to pay a $1,400 fine and will be barred from driving for one year. The video footage was originally capture on the cruiser’s built-in camera. His passionate performance was used as evidence during his trial. Because his friends told him to, Robert Wilkinson, posted the video to YouTube where it gained nine million people watched it. Fed Likely To Keep Buying Bonds (WSJ) Three months after launching an aggressive push to restart the lumbering U.S. economy, Federal Reserve officials are nearing a decision to continue those efforts into 2013 as the U.S. faces threats from the fiscal cliff at home and fragile economies elsewhere in the world. Groupon CEO Says He Remains Right Person To Run Company (WSJ) FYI. World Economy in Best Shape for 18 Months, Poll Shows (Bloomberg) So that's nice. Actor Tim Allen’s Car Stolen By Man Claiming To Be Son (Fox2) To the untrained eye, actor Tim Allen’s 1996 Chevy Impala may not look like much, but with its custom engine and one of a kind interior, it’s worth a lot of money. America’s funnyman Tim Allen loved his car so much, he featured it in a YouTube commercial. The car was special, expensive, upgraded, and was also one of the superstar’s favorites. He even drove it to the People’s Choice Awards and mentioned it on stage when he won his award...So how did Allen’s prized possession make its way from his Los Angeles garage to a corner in Northeast Denver? Faustino Ibarra is facing charges for stealing it. “It’s a priceless vehicle.” Ibarra said to Fox 31 Denver’s Justin Joseph in an exclusive jailhouse interview. “I`m trying to make it simple for you to understand. I didn’t break into (Allen’s) garage. He left the door open and he left me the keys so I could get the car and take it to Denver.” Ibarra claims Allen adopted him years ago and that Allen had allowed him to take the car. “I emailed my dad the morning that I got the car in and everything is fine and I’ve got the car and it`s ready for you and we need to talk about me coming to live with you,” said the inmate. “What you say sounds a little crazy.” Joseph said. “I don`t care how it sounds, I know who I am. He knows who I am. He knows who he is,” Ibarra said. He denies that he has mental health issues and says no matter what anyone thinks, his alleged father, a superstar, will not pursue charges. “My dad loves the heck out of me. He’s ultra-proud of me and he wants to see the best for me in every way,” Ibarra told Joseph. FOX 31 Denver reached out to Allen’s publicist but did not hear back from Allen’s team. FOX 31 Denver also found no independent evidence that Ibarra was ever adopted by Allen.

(Getty Images)

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.

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Opening Bell: 3.20.17

Deutsche Bank is getting more creative; apparently there was a Trump rally; gigantic swastikas brighten Phoenix's skyline; and more.

Opening Bell: 03.21.12

Hartford Bows to Paulson Wish to Exit Annuity Business (WSJ, earlier) Bowing to pressure from hedge-fund titan John Paulson, Hartford Financial Services Group said Wednesday it would exit its annuity business and weigh a sale of a large portion of its life-insurance operation. The move will allow Hartford to focus on its property-casualty unit, where the company got its start more than 200 years ago, as well as its group benefits business and its "high return" mutual fund operation, Chief Executive Liam McGee said in a statement. The announcement marks a substantial change of strategy for Hartford, which has long resisted calls to separate its life insurer from its property-casualty arm. Mr. Paulson, whose hedge fund is Hartford's largest shareholder, became the latest to push for such a move when he took to the company's fourth-quarter-earnings call in February to criticize management and urge them to "do something drastic" to boost the share price. Bernanke As Professor Tries To Buff Fed's Image (NYT) Mr. Bernanke, one of the most powerful men in Washington, has agreed to moonlight as a college professor, delivering four lectures on central banking over the next two weeks. He also will read some student papers...“It always surprises you to realize that this guy actually exists and he’s not just on TV,” said Max Sanders, a 19-year-old from New York. “It’s a once-in-a-lifetime opportunity to hear lectures from him,” said Noah Wiviott, 21, of New Jersey. “He clearly knows what he’s talking about.” Not everyone, however, found him convincing. Yuqi Wu, a 20-year-old student from China, said she did not agree with Mr. Bernanke’s criticism of her government’s monetary policy. “I definitely support the Chinese government’s position,” she said. Buffett Seizes Lead in Bet on Stocks Beating Hedge Funds (Bloomberg) Warren Buffett made a friendly bet four years ago that funds that invest in hedge funds for their clients couldn’t beat the stock market over a decade. So far he’s winning. The wager that began on Jan. 1, 2008, pits the Omaha, Nebraska, billionaire against Protégé Partners LLC, a New York fund of hedge funds co-founded by Ted Seides and Jeffrey Tarrant. Protégé built an index of five funds that invest in hedge funds to compete against a Vanguard mutual fund that tracks the Standard & Poor’s 500 Index. The winner’s charity of choice gets $1 million when the bet ends on Dec. 31, 2017. Banks Seek Delay On Volcker Rule (WSJ) The Volcker rule, which restricts banks' ability to trade with their own money, is set to take effect July 21, whether or not regulators have a final rule in place, according to the 2010 Dodd-Frank financial overhaul law. Federal Reserve Chairman Ben Bernanke said last month that regulators likely wouldn't have a rule in time. A group representing banks and others involved in bundling and selling loans is warning that deals worth hundreds of billions of dollars may need to be shut down because of wording in the law requiring compliance with a rule that doesn't yet exist. Cops arrest Occupy Wall Street protesters in Union Square (NYP) Cops shut down Union Square and kicked out a large crowd of Occupy Wall Street protesters last night, arresting nine demonstrators last night and this morning, just days after larger clashes at the group's former encampment downtown. I love lava lamp (Politico) Another amusing exchange as Mitt Romney walked past a Chicago Google employee with a big blue lava lamp (turned off) on his desk: "That's a big lava lamp, congratulations," Romney said. Wilbur Ross: Long-Term Bond Bubble Getting Ready To Burst (CNBC) "I think the greatest bubble that is about to burst is the 10-year and longer Treasury, because the idea that inflation is gone forever and for all time, and therefore these artificially low rates can last, is silly," the president of W.H. Ross & Co. said in an interview. Bernanke: Fed Is Ready To Act If Europe Falters (Reuters) "In the past few months, financial stresses in Europe have lessened, which has contributed to an improved tone of financial markets around the world, including in the United States," Bernanke said in testimony prepared for a House hearing Wednesday. Bernanke stresses, however, that a full resolution of the crisis "will require a further strengthening of the European banking system; a significant expansion of financial backstops, or “firewalls,” to guard against contagion in sovereign debt markets." Greece Names New Finance Minister (WSJ) Greek Deputy Finance Minister Philippos Sachinidis will be the country's new finance minister, replacing Evangelos Venizelos, the prime minister's office said Wednesday.

Cryan.CalmDown

Opening Bell: 7.25.17

John Cryan opens up (kind of); Goldman bids adieu to ETF market making; Wisconsin company literally getting under employees' skin; and more.

Opening Bell: 01.16.13

Goldman Profit Soars (WSJ) "While economic conditions remained challenging for much of last year, the strengths of our business model and client franchise, coupled with our focus on disciplined management, delivered solid performance for our shareholders," Chief Executive Lloyd C. Blankfein said. Overall, the investment-banking arm recorded revenue of $1.41 billion for the quarter, up from $857 million a year ago and $1.16 billion in the third quarter. Financial advisory revenue rose 8.1% from year ago. Debt underwriting revenue surged to $593 million from $196 million in the year ago and the $466 million reported in the third quarter. Equity underwriting revenue popped 59% from the year ago and 61% from the prior quarter to $304 million. Revenue from fixed income, currency and commodity trading totaled $2.04 billion, versus $1.36 billion a year earlier and $2.22 billion in the third quarter. Revenue from equities execution rose 45% from a year ago to $764 million but fell 10% from the third quarter. Overall profit for the fourth quarter totaled $2.89 billion, compared with a year-earlier profit of $1.01 billion. Earnings per share, reflecting the payment of preferred dividends, jumped to $5.60 from $1.84. Net revenue, including net interest income, surged 53% to $9.24 billion. JPMorgan Profit Tops Estimates (WSJ) JPMorgan's fourth-quarter earnings surged 53% on strong revenue and better credit, as the bank further detailed the fallout from more than $6 billion in trading losses last year. The outsized, complex trades on credit default swaps tied to corporate bonds became known as the "London Whale." On Wednesday, the bank made public an internal report outlining mistakes and oversights by executives who played a role in the matter, including Chief Investment Officer Ina Drew, who has since left the bank, and Douglas Braunstein, who was chief financial officer during the episode and has since become a vice chairman. It also said its Treasury and Chief Investment Office, where the "Whale" trades were made, recorded a loss of $157 million on the fourth quarter, compared to net income of $417 million in the year ago. J.P. Morgan also said it halved the 2012 compensation of Chief Executive James Dimon to $11.5 million. Additionally, he will have to wait up to another 18 months before he can start exercising two million options that were awarded to him five years ago. Overall, J.P. Morgan reported a profit of $5.69 billion, or $1.39 a share, for the fourth quarter, up from $3.73 billion, or 90 cents a share, a year ago. Bankers Get IOUs Instead Of Bonus Cash (WSJ) Several thousand Morgan Stanley traders, investment bankers and other employees will get IOUs instead of cash when bonus day arrives Thursday, a fundamental change in Wall Street pay triggered by the financial crisis. The New York company will pay its bonuses in four equal installments, according to people briefed on the plan, with the first chunk coming in May and the last in January 2016. Employees who quit or are laid off before the payments stand to lose their deferred compensation unless they negotiate a separate deal with the company. "I don't think there will be a lot of cheers on the trading floors of Morgan Stanley," said Mark Williams, a former Federal Reserve bank examiner who now teaches at Boston University. "Bonuses were used to buy houses and cars. They were savings vehicles." AIG Seeks Approval To File More Bank Suits (NYT) Since the summer of 2011, the insurance giant American International Group has been battling Bank of America over claims that the bank packaged and sold it defective mortgages that dealt A.I.G. billions of dollars in losses. Now A.I.G. wants to be able to sue other banks that sold it mortgage-backed securities that plunged in value during the financial crisis. It has not said which banks, but possibilities include Deutsche Bank, Goldman Sachs and JPMorgan Chase. But to sue, A.I.G. first must win a court fight with an entity controlled by the Federal Reserve Bank of New York, which the insurer says is blocking its efforts to pursue the banks that caused it financial harm. Hungary Attacks Roubini Over Currency 'Advice' (CNBC) Hungary's Ministry for National Economy said in a statement that the forint began to depreciate after economist Nouriel Roubini – dubbed Dr Doom for his pessimistic forecasts – said in a newsletter that failure to secure a deal with the International Monetary Fund was bad news for the currency. The forint has been in decline since last week hitting seven-month lows earlier this week but has since gained some ground. Hungarian officials rounded on Roubini saying; "On Thursday speculators seem to have taken Roubini's advice and attacked the forint." BofA Takes A Mortgage Mulligan (WSJ) Less than two years after embarking on a painful retreat from home lending, Bank of America Corp. is girding for a new run at the U.S. mortgage business. Whether that gamble pays off will depend in large measure on how long the mortgage market's run of record profits continues. The Charlotte, N.C., company aims to sell more mortgages through its 5,000-plus branches, executives said. The fourth-biggest U.S. mortgage lender, after Wells Fargo & Co., J.P. Morgan Chase & Co. and U.S. Bancorp, is intent on "growing that business," Chief Executive Brian Moynihan said at a December investor conference. Eurozone Plan May Be Watered Down (WSJ) One of the euro zone's most significant commitments last year aimed at containing its financial crisis—a plan to allow the bloc's bailout fund to directly boost the capital of banks in countries facing debt troubles—could be undermined by technical complications and second thoughts by some governments. Germany Repatriates Gold Reserves (WSJ) Germany's central bank said it would remove nearly a fifth of its total gold reserves from deposits at the New York Federal Reserve Bank and the Bank of France and bring them back to Germany, amid a debate in the country over the transparency of its global gold holdings. Inside Trader Sent To Kinnu-can (NYP) John Kinnucan, the former head of Portland, Ore.-based firm Broadband Research, was sentenced to four years and three months in prison after admitting to feeding illegal stock tips to his well-heeled hedge fund clients. Reporter fired for secret stripping job gets new journalism gig with same (NYDN) Tressler, 30, is now a reporter for the San Antonio Express-News, covering “cops, crime and general mayhem,” according to her Twitter account. In April, the gorgeous Tressler was fired from her job as a society reporter for the Houston Chronicle for failing to tell the newspaper about her after-hours gig as a stripper, which she chronicled in her blog, “Diary of an Angry Stripper.” Tressler then sued her former employer's parent company, the Hearst Corp., which also owns the Express-News, alleging that the firing was unfair. She hired celebrity lawyer Gloria Allred and filed a complaint with the U.S. Equal Employment Opportunity Commission, saying the paper’s reason for firing her -- failing to write on her application that she had been working part-time as a stripper -- was ridiculous. "I've worked at KB Toys. I've worked at a surf shop. I've worked at multiple coffee shops. I've worked at Taco Bell. I've worked as a line cook at a restaurant," Tressler told the Las Vegas Review-Journal in June. “Do you really want me to put every single one of those on my job application?" Over the summer, Tressler embarked on a national stripping tour and pushed a book, which shared the same title as her blog. She also picked up some freelance assignments for “Good Morning America.” After the suit and the tour, it seemed unlikely Tressler would re-enter Texas journalism, let alone for a newspaper owned by the same parent company that fired her. Some have suspected that her new job was part of a settlement she reached with the company.

Opening Bell: 12.13.12

Banker Bonuses Seen Capped at Twice Salary in EU Compromise (Bloomberg) Negotiators from the European Parliament and Cyprus, which holds the rotating presidency of the EU, brokered the draft agreement during a meeting today, said Sharon Bowles, chairwoman of the assembly’s economic and monetary affairs committee. The deal is contingent on compromises being reached on some other parts of an EU law on bank capital. The accord would cap a banker’s bonus at the same level as fixed salary, while giving room for larger awards with shareholder approval, Bowles said in an e-mail after the meeting in Strasbourg, France. A maximum limit would be set forbidding awards of more than twice fixed pay. Rigged Libor With Police Nearby Shows Flaw of Light Touch (Bloomberg) Every morning, from his desk by the bathroom at the far end of Royal Bank of Scotland Group Plc’s trading floor overlooking London’s Liverpool Street station, Paul White punched a series of numbers into his computer. White, who joined RBS in 1984, was one of the employees responsible for the firm’s submissions to the London interbank offered rate, or Libor, the global benchmark for more than $300 trillion of contracts, from mortgages and student loans to interest-rate swaps. Behind him sat Neil Danziger, a derivatives trader at the bank since 2002. On the morning of March 27, 2008, Tan Chi Min, Danziger’s boss in Tokyo, told him to make sure the next day’s submission in yen would increase. “We need to bump it way up high, highest among all if possible,” Tan, known by colleagues as “Jimmy,” wrote in an instant message to Danziger, according to a transcript made public by a Singapore court and reviewed by Bloomberg before being sealed by a judge at RBS’s request. The trader typically would have swiveled in his chair, tapped White on the shoulder and relayed the request, people who worked on the trading floor said. Instead, as White was away that day, Danziger input the rate himself...Events like those that took place on RBS’s trading floor, across the road from Bishopsgate police station and Dirty Dicks, a 267-year-old public house, are at the heart of the biggest and longest-running scandal in banking history. Ex-Bear Stearns Employees to Get $10 Million in Settlement (Bloomberg) The settlement will resolve class-action suits filed beginning in 2008 against Bear Stearns and other defendants by former employees of the bank. The employees, participants and beneficiaries of Bear Stearns’s employee stock ownership plan who held shares of the bank’s common stock, claimed risky investments in subprime mortgages caused them to lose money. Fed Extends Bond Buying To 2013 (WSJ) The Federal Reserve, clarifying its intentions for an economy hobbled by uncertainties, for the first time spelled out the unemployment level it would like to see before it raises short-term interest rates. The Fed said Wednesday, at the conclusion of its last policy meeting of the year, that it would enter 2013 with a plan to purchase $85 billion a month of mortgage-backed securities and Treasury securities, part of a continuing attempt to drive down long-term interest rates to encourage borrowing, spending and investing. Barbara Walters asks Chris Christie if he is too 'heavy' to be President (NYDN) “There are people who say that you couldn’t be president because you’re so heavy,” Walters asked, delicately. “What do you say to them?” “That’s ridiculous. I mean, that’s ridiculous,” Christie retorted. “I mean, I don’t know what the basis for that is.” “I think they’re worried about your health,” she said. “Well, I’ve done this job pretty well," he said, "and I think people watched me for the last number of weeks in Hurricane Sandy doing 18-hour days and getting right back up the next day and still being just as effective in the job, so I don’t really think that would be a problem.” [...] Christie has at times turned his famously sharp tongue on those who make issue of his weight – a problem he notes is shared by a large segment of the U.S. population. During a Washington Post forum in August, he said it was “idiotic” for columnists like Michael Kinsley to suggest that being overweight means he is undisciplined. “It is just one of those last remaining vestiges of prejudice and stupidity in our society that you would draw that direct line between those things,” he said. Jobless Claims Drop (WSJ) Jobless claims decreased by 29,000 to a seasonally adjusted 343,000 in the week ended Dec. 8, the Labor Department said Thursday. Economists surveyed by Dow Jones Newswires expected 367,000 claims. EU, IMF Agree to Lend Greece 49 Billion Euros (Reuters) "Money will be flowing to Greece as early as next week," Eurogroup Chairman Juncker told a news conference after a meeting of ministers from the single currency bloc. "We are convinced the program is back on a sound track." Fraudster to Hedgies: "Sorry" (NYP) Sam Israel, the hedge-fund manager convicted of running a $450 million Ponzi scheme who faked his own suicide to avoid the slammer, apologized for dragging the industry through the mud. “I am deeply ashamed to have disgraced you all by proxy,” Israel told roughly 150 members of the New York Hedge Fund Roundtable in a letter last week. “I am sorry to have tarnished the business I loved and lived for my entire life.” Israel’s message, dripping with self-pity and regret, was delivered at the end of a presentation last Monday at the posh Princeton Club in Midtown, where hedge fund pros had convened to hear from Guy Lawson, the author of a new book on the financial felon. Cola Brand and Lays Team Up for Snack Flavor in China (AdAge) PepsiCo is taking its global Power of One program to jointly promote beverages and snacks a step further in China, with the marriage of two Pepsi brands in a single product: Pepsi-Cola chicken-flavor Lay's potato chips. Cola chicken is a common recipe in China, with chicken wings tossed into a wok and caramelized in soy sauce, spices and cola. In potato-chip form, the flavor is vaguely similar to barbecue with a sugary aftertaste. If there's any hint of Pepsi, it's fleeting and lacks fizz. Richard Lee, PepsiCo's chief marketing officer in China, said the idea came from a brainstorming session involving teams from marketing and R&D, as well as Pepsi ad agency BBDO, Shanghai. Lay's launches a new flavor every year, and this time the goal was fusion. "We thought it would be really cool to have a cola combined with chicken. ... It's a very popular dish in China," said Mr. Lee, who in 2010 became the first person to be put in charge of marketing and portfolio management for both food and beverage brands in China. "Also it would be very cool to involve one of our most-iconic soft drinks," he added..."We want to celebrate a philosophy [that says] you can find happiness all around you,'" Mr. Lee said.

Opening Bell: 04.17.12

Goldman Earnings Beat Expectations (WSJ) For the first quarter, the firm's revenue from fixed income, currency and commodity trading totaled $3.46 billion, down 20% from a year earlier although more than double what the firm booked in the fourth quarter. Investment-banking revenue came in at $1.15 billion, down 9.1% from a year, yet up 35% from a fourth quarter that was bleak across Wall Street. Goldman posted a profit of $2.11 billion, compared with a year-earlier profit of $2.74 billion. Earnings per share—reflecting the payment of preferred dividends—rose to $3.92 from $1.56 a year earlier, topping the $3.55 per-share profit expected by analysts polled by Thomson Reuters. Paulson Said to Short Europe Bonds Amid Spain Concern (Bloomberg) John Paulson, the billionaire hedge-fund manager seeking to reverse record losses in 2011, told investors he is shorting European sovereign bonds, according to a person familiar with the matter. Paulson, 56, said during a call with investors that he is also buying credit-default swaps on European debt, or protection against the chance of default, said the person, who asked not to be identified because the information is private. Spanish banks are of particular concern as their holdings of the country’s debt and client withdrawals make them overly dependent on European Central Bank financing, Paulson told investors. No Double-Dip Deja Vu Seen for U.S. Economy (Bloomberg) “It feels eerily similar to last year, but fundamentally it’s quite different,” said Joseph LaVorgna, chief U.S. economist for Deutsche Bank Securities in New York. He sees the economy growing 3 percent in the fourth quarter from a year earlier, compared with 1.6 percent in 2011. Ainslie's Maverick Makes First Start-Up Seeding In Sycamore Lane (WSJ) Maverick Capital Management LP, the $9 billion investment firm run by Lee Ainslie, has made its first seeding investment in a start-up hedge fund, according to marketing materials sent to investors. According to the materials sent by Sycamore Lane Partners to investors, Maverick provided it with start-up capital, allowing the long/short value-driven equity fund to begin investing April 2. The amount of Maverick's investment isn't outlined, but is described as "significant capital contributions with extended lock through 2015." Alabama Bond Fight Begins New Round (WSJ) Wall Street has sparred with Jefferson County for years over the local government's crippling debt. Now the battle has moved underground, and the two sides are arguing over the condition of 3,200 miles of sewage pipes below Alabama's largest metropolitan area. A federal judge is weighing whether officials of the bankrupt county can divert money that would have gone to pay J.P. Morgan Chase and other debtholders in order to upgrade its leaky sewer system. The case could have far-reaching implications for the $3.7 trillion municipal-bond market. A ruling in the county's favor could upend the notion that holders of debt backed by revenues from utilities such as sewer systems should continue to be paid in full when a municipality files for bankruptcy protection. Toms River Couple Sues Landlord Over Alleged Paranormal Activity (CBS) Jose Chinchilla and his fiancée Michele Callan say they hear eerie noises, that lights flicker, doors slam and a spectral presence tugs on their bed sheets. Chinchilla and Callan are suing the landlord for their $2,250security deposit claiming the paranormal activity forced them out of the home only a week after moving in. For Two Economists, the ‘Buffett Rule’ Is Just a Start (NYT) As much as Mr. Piketty’s and Mr. Saez’s work has informed the national debate over earnings and fairness, their proposed corrective remains far outside the bounds of polite political conversation: much, much higher top marginal tax rates on the rich, up to 50 percent, or 70 percent or even 90 percent, from the current top rate of 35 percent. The two economists argue that even Democrats’ boldest plan to increase taxes on the wealthy — the “Buffett Rule,” a 30 percent minimum tax on earnings over $1 million — would do little to reverse the rich’s gains. Many of the Republican tax proposals on the table might increase income inequality, at least in the short term, according to William G. Gale of the Tax Policy Center and many other left-leaning and centrist economists. Romney Not Too Rich To Relate (Bloomberg) Presumptive Republican presidential nominee Mitt Romney said he isn’t too rich to relate to average Americans and President Barack Obama should “start packing” for a White House departure in 2013. Romney made the remarks in an ABC News interview aired yesterday as Democrats accused him of running a secretive campaign and called on him to release more tax records....Periodically while campaigning this year Romney has made comments drawing attention to his wealth -- and earning scorn from opponents -- including saying he has friends who are NASCAR owners and that his wife, Ann, owns a “couple” of Cadillacs. Brazil’s Unpredictable Central Banker Tombini Confounds Critics (Bloomberg) No central banker in the world’s top 10 economies has surprised analysts as frequently as Brazil’s Alexandre Tombini. Since taking office 15 months ago, Tombini set interest rates lower than economists expected in three out of 10 policy meetings, including an August reduction that all 62 analysts surveyed by Bloomberg failed to anticipate. Russia’s central bank, the second most unpredictable, defied economists in three out of 14 rate decisions in the same period. So far, Tombini has been vindicated. Inflation in Brazil, at 5.24 percent in March, is easing at a pace faster than analysts forecast. While investors have speculated that Tombini may be yielding to political pressure to lower rates, his gloomy assessment of the world economy and risk-taking may prove correct, according to Citigroup Inc.’s Dirk Willer. Husband watching porn online finds film starring his wife (Emirates) An Egyptian man who went online to watch a porno film for the first time got the shock of his life when he found that the woman in the film was his own wife. The man, identified as Ramadan, instantly collapsed in disbelief on the floor at an internet shop before coming round and rushing home to face his unfaithful wife. The woman first denied his allegations and started to swear at him, prompting her husband to face her with the film...“I found 11 films showing my wife in indecent scenes with her lover….it was the first time I watched a porno film and I did this just out of curiosity,” Ramadan told Egyptian newspapers at his house in the northeastern province of Dakhalia...Ramadan said he had been happy during his marriage life until he logged on to that website.