Opening Bell: 3.20.18

Facebook and trade wars got everyone spooked; Brexit update; Uber won't kill anyone today; Bear votes in Russian election; and more!
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Stocks Struggle After Tech Selloff; Dollar Rises: Markets Wrap [Bloomberg]
Trading was mixed and muted in equities across both Europe and Asia following Monday’s selloff, which was sparked by a series of negative tech stories including Facebook Inc.’s data issues and a fatal accident involving an Uber Technologies Inc. self-driving car. U.S. stock futures drifted lower on Tuesday, with contracts for the Nasdaq 100 pointing to more tech declines. Metals were once again under pressure, but Bloomberg’s broader index of raw materials increased.

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Trade war threat is now Wall Street's top economic fear, survey says [CNBC]
Protectionism tops the list of worries on Wall Street, the survey shows, far outpacing concerns over inflation, terrorism and even the Fed itself.
"The market has shifted from a fear of a monetary policy misstep, tightening too aggressively, to a trade policy mistake, escalating into a trade war with China," Art Hogan, chief market strategist at B. Riley FBR, wrote in his response to the survey. "The balance of risk for equities has moved from the Fed to the White House."

A Curveball From the New Tax Law: It Makes Baseball Trades Harder [NYT]
The provision is raising concerns and questions across Major League Baseball and the National Basketball Association, starting with: How do you value a player?
“There is no fair-market value of a baseball player. There isn’t,” said Daniel R. Halem, the chief legal officer of Major League Baseball. “I don’t really know what our clubs are going to do to address the issue. We haven’t fully figured it out yet. This is a change we hope was inadvertent, and we’re going to lobby hard to get it corrected.
The N.B.A. is similarly perplexed. It sent teams an email this month detailing the disruption of the trading system under the new law, but told executives it was still figuring out how to respond.

EU Offers U.K. ‘Improved’ Equivalence for Financial Services [Bloomberg]
It’s not clear what “improved” would mean. What is clear is that the EU is rejecting the U.K.’s bid for its banks to have access to the EU on the basis of mutual recognition of rules. British institutions would only be able to trade in the EU if its rules are deemed equivalent by the European Commission -- a unilateral approval that can be withdrawn at short notice.
Equivalence also means limited access to the bloc’s single market and accepting rules without having a say in making them -- something the U.K. government and its banks reject. The commission has already started to review financial services legislation, to ensure that equivalence rules are appropriate for the situation after the withdrawal of the U.K., according to the document seen by Bloomberg.

RBS Chief McEwan hopes to resolve Justice Department case in 2018 [Reuters]
“I’ve got the timing of this completely wrong for the last 15 months, I thought we would’ve had it tidied by end-2017... all I’d say (is) it will be in hopefully in 2018,” Ross McEwan said at the Morgan Stanley European Financials conference in London.
The expected multi-billion-dollar settlement would be a key milestone for the state-owned lender, allowing it to resume paying dividends to shareholders and paving the way for the British government to resume selling its shares in the lender.

Facebook facing a level of uncertainty it hasn’t seen before, Goldman Sachs says [CNBC]
"It certainly introduces a level of uncertainty that we haven't seen with Facebook before," Heath Terry, lead internet research analyst at Goldman Sachs, told CNBC on Tuesday.
Terry explained that every fast-growing tech giant was likely to face a similar crisis, before singling out the so-called click fraud scandal which threatened Google's growth prospects in recent years.
"That's going to be the same here for Facebook. It's going to be how they manage through this that will ultimately determine their long term future," Terry said.

Uber Suspends Driverless-Car Program After Pedestrian Is Killed [WSJ]
In response, Uber on Monday temporarily pulled its self-driving cars off the roads where it has been testing them in four cities. An Uber spokeswoman said the company is investigating the incident and cooperating with authorities.
Police in Tempe, Ariz., said the Uber vehicle was in autonomous mode with a human safety operator at the wheel when it hit 49-year-old Elaine Herzberg on Sunday night while she was walking her bicycle outside of a crosswalk. The woman later died from her injuries, according to a police statement.

From Wall Street to weed: How the financial crisis lit up the pot industry [Reuters]
At the time, he was managing approximately $120 million in client assets, but was growing disenchanted with what he saw as a U.S. stock market driven by high-frequency trading and algorithms rather than fundamentals. He started looking for other opportunities, and soon stumbled on some of the first legal medical marijuana dispensaries that had opened in the San Francisco Bay Area.
“I started looking at this through a finance guy’s eyes and saw that maybe there was something going on here,” he said.
He soon discovered that dispensaries were bringing in sales of more than $4,000 per square foot, a rate higher than any U.S. retailer but Apple Inc , and more than 12 times the average $325 per square foot among all companies in the sector.
“You had places the size of Starbucks bringing in $15 million a year, which is absurd,” Peterson said.

Guy In Bear Costume Has No Problem Voting In Russian Election [HuffPo]
During Sunday’s national election, a voter in the Siberian town of Severobaykalsk ― more than 3,400 miles east of Moscow ― decided to show he was bullish on Russia by dressing up as a bear.
Russian government-controlled Sputnik News reported that the unnamed voter scared a few people with his loud roar, but that most people seemed amused.
However, there were some challenges. For one, the bear could barely fit into the voting booth, the video below shows.

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Opening Bell: 06.18.12

Banks Worry As Breakup Talk Revived After JPMorgan Loss (Bloomberg) “There seems to be growing interest in some type of breakup proposal,” said Sheila Bair, a former chairman of the Federal Deposit Insurance Corp. The concept is expected to arise today as JPMorgan Chief Executive Officer Jamie Dimon testifies before the House Financial Services Committee on the trading debacle. Last week he told the Senate that the losses, which carved about $23 billion from the bank’s market value, were due to a poor investing strategy coupled with management failures. Senator Sherrod Brown seized on that admission. “It appears executives and regulators simply can’t understand what is happening in all these offices at once,” the Ohio Democrat said during the June 13 hearing. “It demonstrates to me that too-big-to-fail banks are, frankly, too-big-to-manage and too-big-to-regulate.” Greece Set For Bailout Reward As EU Sees Tweaked Aid Terms (Bloomberg) Greek voters are likely to get a reward for backing pro-euro parties, with European creditors set to ease bailout terms on the debt-swamped country mired in the fifth year of recession. A first step will be when Greece’s still to-be-formed government requests modifications to the 240 billion-euro ($303 billion) rescue programs, leading to a revision of Greece’s economic-performance targets sometime before September, a European official told reporters in Brussels today. Greek Coalition Needs 'Breathing Room' From Creditors: MP (CNBC) Kyriakos Mitsotakis, an MP for New Democracy, which won most votes in Sunday’s election and was Tuesday locked in negotiations with historic rivals Pasok and the Democratic Left to form a coalition, told CNBC: “Giving a very sick patient nothing but the same medicine when this has not had the required result would be madness.” Austerity Doesn't Pay As Debt Markets Ignore Rating Cuts (Bloomberg) "I don’t think we should be slaves to the ratings agencies,” Mervyn King, governor of the Bank of England, told lawmakers on Feb. 29. “What we’ve seen is, the action they took recently did actually have no impact on the yield that people in the market were willing to lend to the U.K. government at.” Buying Opportunity All Over Europe, Even Greece, Says Donald Trump (CNBC) FYI: "You're getting it for nothing, you're getting the land for nothing, you're getting everything for nothing," he said. "You have to sit with it for a while, but there are a lot of great opportunities in Europe. There's no question about it. I'm actually looking at something — it's so ridiculous, it's laughable — and yet I'm thinking about doing something over there with a group that is very smart, and frankly there is an opportunity." Einhorn's Overlooked Bear Call on US Steel Pans Out (Reuters) The Greenlight Capital manager unveiled his negative critique of U.S. Steel at the Ira Sohn charitable conference on May 16, where more attention was focused on Einhorn's bearish views on industrial goods company Martin Marietta Materials and online retailer Amazon.com . Yet it's Einhorn's U.S. Steel call that has outperformed, after the closely watched hedge fund manager zeroed in on the company's poor earnings, high pension costs and the impact of China's slowing demand for iron ore. As of Monday's close, the steelmaker's stock price was down 23.1 percent since the popular conference, where top hedge fund managers reveal their best investing ideas. Meanwhile, shares of Martin Marietta have lost about 8.5 percent over the same time period and Amazon's stock is down 0.8 percent. Mark Cuban sells Facebook stake, says 'it was gambling money' (DJ) The billionaire investor and Dallas Mavericks owner sold his stake in the social network, less than a month after initially disclosing he had built a position in the company following its bungled initial public offering. "I took my hit, my thesis was wrong," Cuban said in a CNBC interview. "I thought we'd get a quick bounce just with some excitement about the stock. I was wrong, and when you're wrong you don't wait, you just get out. I took a beating and left."...Cuban described the move as "a trade, not an investment" and compared it to trading baseball cards. "It was gambling money, to be honest with you," he said on Monday. "Any time you try to time the market, you get what you deserve. Sometimes you're right. Sometimes you're wrong. This time I was wrong." Goldman: Fed Will Ease Monetary Policy This Week (CNBC) The Federal Open Market Committee will likely say it would buy assets such as mortgage-backed securities and U.S. Treasurys when it meets for a two-day meeting starting Tuesday, Jan Hatzius, the investment bank’s Chief U.S. Economist said in a report on Monday. “We would be quite surprised if we saw no easing this week,” Hatzius wrote in the report. The End Of The Line For Famed Exchange (WSJ) The owner of the Bendigo Stock Exchange, which traces its roots to a time when thousands of prospectors descended on Victoria state after gold was discovered by two women washing clothes in a creek, plans to close the institution at the end of June. Mike Tyson Set For Broadway Debut (NYDN) The last time Mike Tyson was on stage at a Broadway theater, it was four years ago and he nearly wrecked what was left of his boxing career by biting Lennox Lewis on the leg during a press conference at the Hudson Theater. Now Tyson is returning to a Broadway theater to breathe life into his new career - theatrical performer. Tyson was on stage at the Longacre Theater in midtown on Monday afternoon to announce his one-man show, which will begin a limited engagement on July 31. The show, entitled "Mike Tyson-Undisputed Truth'' will be directed by Spike Lee, who also will be making his Broadway debut. "Mike has lifted himself off the canvas,” Lee said. "It's a great story and Mike tells it masterfully.”

Photo: Getty Images

Opening Bell: 6.23.16

Brexit, Brexit, Brexit; Chanos thinks SolarCity deal stinks; Mac ’n Cheetos; NASA engineer builds world’s largest nerf gun; and more.

Opening Bell: 11.25.15

"Hedge funds stalk battered corner of bond world"; Goldman bankers join Uber; Private equity goes after Premier League; Baby Cheesus; and more.

Opening Bell: 10.31.12

Questions Cloud Market Reopening (WSJ) The New York Stock Exchange said Tuesday that it plans to open as usual at 9:30 a.m. and that its trading floor and headquarters in lower Manhattan were "fully operational" despite widespread blackouts and flooding in that part of the city. The Nasdaq Stock Market and other exchanges will open as well. Bond markets will follow suit. While investors and industry officials breathed a sigh of relief, critics argued that the storm exposed how ill-prepared exchanges and their Wall Street customers are for such an event. Regulators on Tuesday said they plan to probe whether more needs to be done to get exchanges and the trading community ready for such disasters. After Hurricane, Wall Street Back To Work (Dealbook) On Tuesday, the scene around Wall Street was desolate. While the New York Exchange’s building appeared to be unscathed, many other offices in the vicinity were flooded. After an underground parking garage two blocks from the exchange was inundated with water, several cars floated to street level. Two Citigroup buildings were without power. The bank told employees in a memo on Tuesday that one of the buildings, 111 Wall Street, sustained “severe flooding and will be out of commission for several weeks.” Some JPMorgan Chase employees outside New York City were working in central New Jersey. At the bank’s main trading floor in Midtown Manhattan, employees, many in jeans, shirts and rain boots, booked hotels for the night and discussed strategy. The bank, which sustained minimal damages at a building downtown, expected to resume normal operations in Midtown. Credit Suisse also planned to open for business on Wednesday, with its main offices by Madison Square Park running on backup power. In downtown New York, Goldman Sachs was one of the few buildings with power. The firm has a generator in the event of outages, allowing its trading floors to continue to run. On Tuesday, televisions sets and lights inside the building were on, although few employees were there...In a memo to staff, Goldman announced its headquarters would be open on Wednesday. The firm also booked hotels in various locations to make sure employees could get to work. Deutsche Bank Rides Debt-Market Wave (WSJ) Deutsche Bank reported a surge in investment-banking revenues in the third quarter as a rebound in client activity fueled the best quarter ever for its fixed-income division. Deutsche Bank, Europe's largest lender by assets, reported group revenues of €8.7 billion ($11.5 billion), up 19% from the third quarter last year. The result was better than analysts expected, but the bank's legal problems and restructuring efforts nearly flattened net income. At €747 million, the total was up 3% from €725 million a year earlier. The bank's revenue increase was driven in part by bond-buying initiatives announced by the U.S. Federal Reserve and the European Central Bank in recent months. The moves have fueled a resurgence in client activity, including in fixed-income trading—an area where UBS AG and other competitors have announced significant cut backs, allowing Deutsche Bank to gain market share. UBS Moves Quickly On Job Cuts, Revamp (WSJ) Scores of traders at UBS were locked out of the Swiss bank's London offices Tuesday as the institution moved quickly to implement the first of thousands of job cuts in a strategic restructuring. The revamp effectively brings an end to UBS's attempts over the past two decades to build a world-class investment bank, which brought the institution to the brink of collapse in 2008 when it incurred more than $50 billion in losses from the fixed-income business that it is now exiting. Instead, UBS's strategy will center on its private bank, the world's second-largest in assets after Bank of America and a mainstay of the group's earnings. UBS confirmed Tuesday that it will cut risk-weighted assets by around 100 billion Swiss francs ($107 billion) by the end of 2017, eliminate about 10,000 jobs across the bank and reorganize its investment bank to deliver more products and services to ultra-wealthy clients at the private bank. The bank also said Tuesday that charges related to the moves, which come in response to a tougher regulatory and economic climate, helped push it into the red in the third quarter. UBS Chief Executive Sergio Ermotti said that London would bear the brunt of the cuts as the bank attempts to exit almost completely from fixed-income activities and move back to its wealth-management roots. Storm Cripples US East Coast, Death and Damage Toll Climb (CNBC) The U.S. death toll climbed to 50, according to The Associated Press, with many of the victims killed by falling trees. Damage estimates reached into the tens of billions, while the storm disrupted campaigning and early voting ahead of the November 6 presidential election. More than 8.2 million households were without power in 17 states as far west as Michigan. Nearly 2 million of those were in New York, where large swaths of lower Manhattan lost electricity and entire streets ended up under water. New York Subway System Faces Weeks to Recover From Storm (Bloomberg) If you laid the New York City subway system in a line, it would stretch from New York to Detroit. Now imagine inspecting every inch of that track. That’s the job ahead for Metropolitan Transit Administration officials, who must examine 600 miles of track and the electrical systems with it before they can fully reopen the largest U.S. transit system, which took a direct hit by Hurricane Sandy. Seven subway tunnels under New York’s East River flooded, MTA officials said. Pumping them out could take days, and a 2011 state study said it could take three weeks after hurricane- driven flooding to get back to 90 percent of normal operations. That study forecast damages of $50 billion to $55 billion to transportation infrastructure including the subways. How CEOs Improvised In The Wake Of Sandy (WSJ) When the approach of Hurricane Sandy left Lands' End Chief Executive Edgar Huber stranded on a business trip, he retreated to an impromptu backup headquarters—in his mother-in-law's apartment complex...Foot Locker CEO Ken Hicks disregarded the shutdown of his New York headquarters on Monday and worked at his office until 3 p.m. Then he picked up the work again six blocks away at his home in Manhattan's Murray Hill neighborhood. When the power went out, he put on iTunes, lit a lantern and did paperwork for another 2½ hours. "You can be reasonably self-sufficient with a cellphone and a lantern," the CEO says. Celebrities React To Northeast Hurricane (NYDN) “WHY is everyone in SUCH a panic about hurricane (i’m calling Sally)...?” Lindsay Lohan tweeted Sunday night. “Stop projecting negativity! Think positive and pray for peace.” A Year Later, All Eyes Still On 'Edie' (WSJ) Who broke the law by raiding customer accounts at MF Global Holdings? Investigators seem no closer to the answer than they were when the New York brokerage firm filed for bankruptcy exactly a year ago Wednesday, owing thousands of farmers and ranchers, hedge funds and other investors an estimated $1.6 billion. Their money was supposed to be stashed safely at MF Global, but company officials used much of it for margin calls and other obligations. The last, best hope for a breakthrough in the probe is Edith O'Brien, the former assistant treasurer at MF Global. Working in the company's Chicago office, she was the go-to person for emergency money transfers as MF Global flailed for its life. MBA's Rethink Wall Street (WSJ) Many of the nation's top M.B.A. programs, including Harvard Business School and Stanford Graduate School of Business, reported declines in the share of students who took jobs in finance this year. And even those that posted some gains, such as University of Pennsylvania's Wharton School, are still well below their prefinancial crisis levels...A Wall Street gig "isn't as prestigious as it used to be" because the future—promotion opportunities, salary gains, even basic job security— is so unclear, says Mark Brostoff, associate dean and director of the career center at the Olin Business School at Washington University in St. Louis. Though the share of Olin students going into finance increased to 22% of job seekers this year from 15% in 2011, many of those gains came at boutique and regional Midwestern financial firms rather than on Wall Street. One factor affecting student demand: Banks expect young staffers to pick up the slack left by masses of laid-off midlevel employees, without necessarily offering more generous pay packages in return for the long hours. At Harvard Business School, for example, students heading into investment banking—7% of job seekers who accepted jobs, down from 10% in 2011—reported median salaries and signing bonuses were flat with last year, at $100,000 and $40,000, respectively, while other guaranteed compensation fell to $8,750 from $40,000. Disney $4 Billion ‘Star Wars’ Deal Spotlights Content Bet (Bloomberg) Walt Disney agreed to buy George Lucas’s Lucasfilm Ltd. for $4.05 billion, pressing Chief Executive Officer Robert Iger’s $15 billion bet on creative franchises by adding “Star Wars” and “Indiana Jones.” Lucas, 68, the sole owner, will get half in cash and the rest in stock, making him a major investor in the film, theme park and TV company, according to a statement yesterday from Burbank, California-based Disney. The first of a new trilogy of “Star Wars” films will be released in 2015, Disney said. France Can’t Compete With Rest of Europe: WTO Chief (CNBC) France is uncompetitive not only versus China, but against the rest of Europe, according to Pascal Lamy, director general of the World Trade Organization. “The competitiveness of France on foreign markets has been damaged for the last 10 years. This is nowhere more obvious than in Europe, where France has lost market share for the last 10 years,” said Lamy in an exclusive interview with CNBC in Paris. Cop Tasers 10 Year-Old For Refusing To Clean His Car (CN) A New Mexico policeman Tasered a 10-year-old child on a playground because the boy refused to clean his patrol car, the boy claims in court. Guardian ad litem Rachel Higgins sued the New Mexico Department of Public Safety and Motor Transportation Police Officer Chris Webb on behalf of the child, in Santa Fe County Court. Higgins claims Webb used his Taser on the boy, R.D., during a May 4 "career day" visit to Tularosa New Mexico Intermediate School. "Defendant Webb asked the boy, R.D., in a group of boys, who would like to clean his patrol unit," the complaint states. "A number of boys said that they would. R.D., joking, said that he did not want to clean the patrol unit. "Defendant Webb responded by pointing his Taser at R.D. and saying, 'Let me show you what happens to people who do not listen to the police.'" Webb then shot "two barbs into R.D.'s chest," the complaint states. "Both barbs penetrated the boy's shirt, causing the device to deliver 50,000 volts into the boy's body.

Opening Bell: 12.21.12

Critics Say UBS Let Off Too Easy (WSJ) Our goal here is not to destroy a major financial institution," Lanny Breuer, assistant attorney general for the Justice Department's criminal division, said Wednesday after the $1.5 billion fine against UBS was announced. Prosecutors have to at least "evaluate whether or not innocent people might lose jobs" and other types of potential collateral damage. Sen. Charles Grassley (R., Iowa), a Senate Finance Committee member, said he is unsatisfied that prosecutors didn't go higher up the corporate ladder at UBS than its Japanese subsidiary..."The reluctance of U.S. prosecutors to file criminal charges over big-time bank fraud is frustrating and hard to understand," Mr. Grassley said. The $1.5 billion fine is a "spit in the ocean compared to the money lost by borrowers at every level, including taxpayers." Regulatory 'Whale' Hunt Advances (WSJ) The first regulatory ripples from the "London Whale" trading fiasco are about to hit J.P. Morgan Chase. The Office of the Comptroller of the Currency, led by Comptroller Thomas Curry, is preparing to take a formal action demanding that J.P. Morgan remedy the lapses in risk controls that allowed a small group of London-based traders to rack up losses of more than $6 billion this year, according to people familiar with the company's discussions with regulators. Khuzami To Leave SEC Enforcement Post (WSJ) Robert Khuzami, head of the Securities and Exchange Commission's enforcement unit, plans to leave the agency as soon as next month, a person familiar with the expected move said Thursday. Boehner Drops ‘Plan B’ as Budget Effort Turns to Disarray (Bloomberg) House Speaker John Boehner scrapped a plan to allow higher tax rates on annual income above $1 million, yielding to anti-tax resistance within his own party and throwing already-stalled budget talks deeper into turmoil. He will hold a news conference today at 10 a.m. Washington time to discuss the next steps in the budget dispute, a Republican leadership aide said. House members and senators won’t vote on the end-of-year budget issues until after Christmas, giving them less than a week to reach agreement to avert tax increases and spending cuts set to take effect in January. The partisan divide hardened yesterday, making the path to a deal more uncertain. BlackRock Sees Distortions in Country Ratings Seeking S&P Change (Bloomberg) Credit rating companies are distorting capital markets by assigning the same debt ranking to countries from Italy to Thailand and Kazakhstan, according to BlackRock, the world’s biggest money manager. While 23 countries share the BBB+ to BBB- levels assessed by Standard & Poor’s, the lowest investment grades, up from 15 in 2008 at the beginning of the financial crisis, their debt to gross domestic product ratios range from 12 percent for Kazakhstan to 44 percent for Thailand and 126 percent for Italy, International Monetary Fund estimates show. The cost of insuring against a default by Italy, ranked BBB+, over the next five years is almost triple that for Thailand, which has the same rating. For BlackRock, which oversees $3.7 trillion in assets, the measures are so untrustworthy that the firm is setting up its own system to gauge the risk of investing in government bonds. This year, the market moved in the opposite direction suggested by changes to levels and outlooks 53 percent of the time, data compiled by Bloomberg show. “The rating agencies were very, very slow to the game,” Benjamin Brodsky, a managing director at BlackRock International Ltd., said in a Nov. 23 interview from London. “They all came after the fact. For us, this is not good enough.” If You Bought Greek Bonds in January You Earned 80% (Bloomberg) Greek government bonds returned 80 percent this year, compared with 3.7 percent for German bunds and 6.1 percent for Spanish securities, Bank of America Merrill Lynch indexes show. It’s the first year since 2009 that investors made money on Greek securities, with 2012 providing the biggest advance since Merrill began compiling the data in 1998, according to figures that don’t reflect this month’s debt buyback by the government. Texas lawmaker: ‘Ping-pongs’ deadlier than guns (The Ticket) Incoming Texas State Rep. Kyle Kacal says guns don’t kill people—ping-pong kills people. "I've heard of people being killed playing ping-pong—ping-pongs are more dangerous than guns," he says. "Flat-screen TVs are injuring more kids today than anything." The lifetime rancher, who will take his seat in 2013 as a freshman, says that new gun restrictions are unnecessary. Kacal, who reportedly operates a hunting business, notably came out against a bill instructing Texans how to secure their assault weapons. "People know what they need to do to be safe. We don't need to legislate that—it's common sense," he said. "Once everyone's gun is locked up, then the bad guys know everyone's gun is locked up." Flare-up in war of words between Ackman, Herbalife (NYP) “This is the highest conviction I’ve ever had about any investment I’ve ever made,” Ackman said yesterday in a series of interviews. The investor told CNBC that he expects the Federal Trade Commission will take a “hard look” at the company. The heavyweight battle picked up steam over the last two days and has become, in the typically slow days leading up to Christmas, one of the most-watched events on Wall Street. As the financial world watched, Herbalife CEO Michael Johnson returned fire — calling Ackman’s statements “bogus” and asking the Securities and Exchange Commission to probe the motives of Ackman and his Pershing Square Capital hedge fund. A spokeswoman said if Johnson were allowed the chance to face-off against the investor at the Downtown conference, the CEO “would have been able to tear Mr. Ackman’s premises and interpretation of our business model apart.” Citigroup Said to Give CCA Managers 75% Stake in Funds for Free (Bloomberg) Among Vikram Pandit’s last jobs as Citigroup’s chief executive officer was to decide the fate of the bank’s hedge-fund unit, which employs some of his oldest colleagues. He agreed to give them most of it for free. While Citigroup is keeping a 25 percent stake, managers at the Citi Capital Advisors unit will pay nothing for the remaining 75 percent of that business as it becomes a new firm managing as much as $2.5 billion of the bank’s money, according to people with knowledge of the plan. The lender will pay the executives fees while gradually pulling out assets to comply with impending U.S. rules, said the people, who requested anonymity because the terms aren’t public. The deal was Citigroup’s response to the Volcker rule. Peter Madoff Is Sentenced to 10 Years for His Role in Fraud (Dealbook) A lawyer by training, Peter Madoff is the second figure in the scandal to be sentenced. His older brother, Bernard, pleaded guilty in March 2009 and is serving a prison term of 150 years. UK Boom in Pound Shops: An Austerity-Proof Business Model? (CNBC) Pound shops in the U.K. are reporting massive increases in profits across the board showing that the formula "pile 'em high and sell 'em cheap" has particular resonance in Britain's current age of austerity. Names like "Poundstretcher," "Poundland" and "99p Stores" in the U.K. have become high street stalwarts as other brands go bust. The chains, immediately recognizable on price point, are opening new stores and reporting record results reflecting the increasing public demand for cheaper goods. U.K. based "Poundland" is one such chain reporting steep sales growth as its range of 3,000 items -- from umbrellas and pregnancy tests (it sells 14,000 a week) to bird feeders and bags of crisps all priced at one pound – resonates with cash-strapped Britons. In the year to April 2012, the Warburg Pincus owned company said its turnover increased 22 percent to 780 million pounds ($1.25 billion) and profits increased by 50 percent to 18.3 million pounds from last year's figure of 12.2 million. Former Olympian Suzy Favor Hamilton admits to life as a $600-an-hour hooker (NYP) Steamy, lingerie-clad images of the champion runner helped tout her services on the Web site of a Vegas escort agency called Haley Heston’s Private Collection, where Favor Hamilton operated under the name “Kelly Lundy,” according to The Smoking Gun. Customers could hire her lithe Olympic-class runner’s body for $600 an hour, $1,000 for two hours and $6,000 for 24 hours. The site described her build as “athletic,” her bosom as “perky,” and her belly button as “pierced.” She was willing to provide horny customers the full “girlfriend experience,” and would also engage in a certain undisclosed sex act for an extra $300. “I enjoy men of all shapes, sizes and colors, and I have an affinity for women (I am bisexual),” “Kelly” wrote on her page on the escort service’s Web site. “I consider dates with couples an experience to cherish.” Her sexual skills reportedly earned her a high rating on The Erotic Review, a Web site frequented by prostitution fans. Favor Hamilton’s lusty secret life might have stayed secret if she had not made the mistake of revealing her true identity to some of her wealthy johns, who went to the media.