Opening Bell: 8.24.18

China trade talks stalled; Fed decision looming; Aussies oust Turnbull; American hero loses job; and more!
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Chill Remains Between China and United States in Latest Trade Talks [NYT]
A restart of trade talks between the United States and China ended on Thursday with little sign of progress as Washington moved ahead with additional tariffs and President Trump met with legislators to discuss a new law aimed at curbing Chinese investment.
The bilateral talks, while low level, were the first formal discussions between the two countries since the United States imposed tariffs on $34 billion worth of Chinese goods and China retaliated with its own levies on American products. Still, administration officials continually played down the potential for resolution out of these talks, which came during a week in which the United States placed tariffs on another $16 billion worth of imports and trade officials began six days of hearings on proposed tariffs affecting an additional $200 billion in Chinese goods.

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Dollar dips, global stocks inch up ahead of Powell speech [Reuters]
The MSCI All-Country World index which tracks shares in 47 countries, was up by 0.1 percent. Shares in Europe rose, with the pan-European STOXX 600 index up 0.2 percent on the day.
Futures indicated Wall Street was set to open higher.
Against a basket of six major currencies, the dollar stood at 95.516 .DXY, down 0.3 percent on the day.

A Populist Wave Ousts Australia's Turnbull [Bloomberg]
A decade of easy money since the collapse of Lehman Brothers Holdings Inc. fueled a borrowing binge that’s left Australian households among the world’s most indebted. Combined with flat wages, surging home prices and swelling immigration that’s clogged roads in major cities, many voters feel worse off even though the economy just completed its 27th recession-free year.
Those forces have spurred voter discontent with Australia’s major parties and prompted a leakage of support to fringes of the political spectrum. That helps explain how an insurgency, driven by a small group of conservative former ministers, was this week able to bring down political centrist and former Goldman Sachs banker Malcolm Turnbull as prime minister.

Treasury, IRS move to block blue state workarounds on tax caps [CNBC]
The $10,000 limit on the so-called SALT deduction was part of the Tax Cuts and Jobs Act, an overhaul of the tax code, which was passed last year.
New York, New Jersey and Connecticut — among the states with the highest property taxes — had put legislation in place to help taxpayers bypass the limit on the deduction.
Those plans included permitting municipalities to set up charitable funds and allow taxpayers to contribute to them.

Little-known Chicago fund wins big in US IPO bonanza [FT]
Driehaus Capital has invested in more than half of the 20 best-performing IPOs so far this year, while avoiding all of the worst-performing offerings.
Most of the shares — among them medical devices and software companies — were held in the firm’s micro-cap and small-cap growth funds, which are up 33 per cent and 31 per cent, respectively, so far this year. That compares with 18 per cent for the average of its peers, according to Morningstar data.

This Security Guard Filmed All His Farts for Six Months and Went Viral [VICE]
His first name is Doug (he declined to give VICE his last name, or the name of the hospital), but the Kevin James-looking everyman is known on his 20,000 follower-strong Instagram account as Paul Flart, a stinky offshoot of mall cop Paul Blart. On Wednesday, a video compilation of his most memorable ass clappers earned over 374,000 views after shooting to the top of Reddit’s r/videos forum. Now he has followers from all over the world. “It transcends all languages. There’s no translation necessary, it’s just funny,” he told VICE over the phone.

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Opening Bell: 12.03.12

Fiscal Cliff Talks At Stalemate (WSJ) Leading figures on both sides doubled down on their positions in interviews that aired Sunday, and they blamed each other for the current standoff, reflecting the talks that House Speaker John Boehner (R., Ohio) told "Fox News Sunday" have gone "nowhere." Treasury Secretary Timothy Geithner, speaking on the same program for the Obama administration, suggested Republicans needed to take a breather from negotiations but would ultimately agree to raise tax rates—a key White House demand that is part of its push to raise $1.6 trillion in taxes over 10 years. "It's obviously a little hard for them now, and they're trying to figure out where they go next, and we might need to give them a little time to figure out where they go next," Mr. Geithner said. Geithner Joins Boehner to Trade Blame on Fiscal Cliff Talks (Bloomberg) “There’s not going to be an agreement without rates going up,” Geithner said in a taped interview that aired Sunday on CNN’s “State of the Union.” Republicans will “own the responsibility for the damage” if they “force higher rates on virtually all Americans because they’re unwilling to let tax rates go up on 2 percent of Americans.” Clock Ticks For SAC Investors (WSJ) Seventy-five days remain until Feb. 15, the date by which investors must tell SAC whether they want to pull money from the firm during the next redemption period...Some investors already decided to pull out. French bank Société Générale SA, which has client money in SAC through its Lyxor asset-management arm, has put in a request to pull its money from the firm, according to people familiar with the matter. It is unclear how much money Lyxor has in SAC. Many, however, said they would reserve judgment, at least for now. Ironwood Capital Management, a San Francisco-based investment firm with client money in SAC, has been in touch with investors about the position and is monitoring the situation, said a person familiar with the firm. Last week, a unit within Morgan Stanley's MS +0.06% asset-management arm that has client money with SAC sent a note telling employees it would monitor the situation and be in touch frequently with SAC, according to a person familiar with the bank...Greycourt & Co., Inc., a Pittsburgh-based firm that manages about $9 billion for wealthy families, says it is sticking with SAC. Greycourt cited the stellar long-term returns of the firm, what it says is a robust compliance staff at SAC, Mr. Cohen's promise to cover any penalties himself and a belief that the firm's investment portfolio would be well-protected, even if it eventually faces charges. "The SAC portfolio is liquid enough that I'm not terribly concerned," says Gregory Curtis, Greycourt's chairman. "I very much hope that [Mr.] Cohen hasn't been behaving badly, but either way I'm not too concerned about our client positions." UK’s Euro Trade Supremacy Under Attack (FT) The City of London should be deposed as the euro's main financial center so the single currency club can "control" most financial business in the euro zone, France's central bank governor has said. Christian Noyer of the Banque de France said there was "no rationale" for allowing the euro area's financial hub to be "offshore", in a blunt assessment that will fan UK concerns over EU rules being rigged against it. "Most of the euro business should be done inside the euro area. It's linked to the capacity of the central bank to provide liquidity and ensure oversight of its own currency," Mr Noyer told the Financial Times while touring Asia to promote Paris as a renminbi trading center. "We're not against some business being done in London, but the bulk of the business should be under our control. That's the consequence of the choice by the UK to remain outside the euro area." Zoe Cruz trying to make a return to high finance, has reconciled with John Mack (NYP, earlier) Sources say Cruz has reconciled with her former boss Mack, who helped fuel her rise within their firm before their falling out. He has been helping his one-time protégée in her efforts to land at a buyout firm such as KKR. Mack also has been a shoulder for Cruz to lean on as she copes with the split from her husband Ernesto Cruz...[who] was once reprimanded by his superiors in the mid-2000s for frolicking in a hotel pool in Midtown after a company Christmas gala with a group of female assistants, according to sources familiar with the situation. SEC Chief Delayed Rule Over Legacy Concerns (WSJ) Internal SEC emails, released to a congressional panel and reviewed by The Wall Street Journal, appear to show how a last-minute intervention by a consumer lobbyist might have helped persuade Ms. Schapiro to change her mind and delay one of the centerpiece measures of the Jumpstart Our Business Startups, or JOBS, Act. In Panicky Russia, It’s Official: End of World Is Not Near (NYT) There are scattered reports of unusual behavior from across Russia's nine time zones. Inmates in a women's prison near the Chinese border are said to have experienced a "collective mass psychosis" so intense that their wardens summoned a priest to calm them. In a factory town east of Moscow, panicked citizens stripped shelves of matches, kerosene, sugar and candles. A huge Mayan-style archway is being built — out of ice — on Karl Marx Street in Chelyabinsk in the south. For those not schooled in New Age prophecy, there are rumors the world will end on Dec. 21, 2012, when a 5,125-year cycle known as the Long Count in the Mayan calendar supposedly comes to a close. Russia, a nation with a penchant for mystical thinking, has taken notice. Last week, Russia's government decided to put an end to the doomsday talk. Its minister of emergency situations said Friday that he had access to "methods of monitoring what is occurring on the planet Earth," and that he could say with confidence that the world was not going to end in December. He acknowledged, however, that Russians were still vulnerable to "blizzards, ice storms, tornadoes, floods, trouble with transportation and food supply, breakdowns in heat, electricity and water supply." Similar assurances have been issued in recent days by Russia's chief sanitary doctor, a top official of the Russian Orthodox Church, lawmakers from the State Duma and a former disc jockey from Siberia who recently placed first in the television show "Battle of the Psychics." One official proposed prosecuting Russians who spread the rumor — starting on Dec. 22. Old testimony may bite Cohen in SEC case (NYP) Steve Cohen’s sworn testimony in another legal skirmish could come back to haunt his $14 billion hedge-fund empire...In 2011, Cohen gave several days of deposition testimony in the civil fraud case, in which Fairfax sued SAC and other firms for allegedly conspiring to drive down its share price. The case was dismissed due to a lack of evidence, but the testimony offers a rare look into Cohen’s views on illegal trading. In his testimony, Cohen called SEC rules on insider trading “vague” and said he doesn’t expect his employees to follow the company’s internal compliance manual to the letter. When asked whether it was “legal or illegal to trade on material nonpublic information,” Cohen said: “It depends on the circumstance.” “So there are circumstances, in your view, in which it is legal . . . to trade on the basis of material, nonpublic information?” asked Fairfax ’s lawyer, Michael Bowe. “Yes,” Cohen said. Among them, he said, is when employees trade in the opposite direction of the nonpublic information they receive. He also said he didn’t expect employees to adhere to the company’s compliance manual in every situation. “See, we don’t operate our firm in absolutes,” he said. “When I look at this manual, I see guidelines.” Morgan Stanley trader probed over trades made while at Goldman (Reuters) Morgan Stanley trader Edward Glenn Hadden is under investigation by regulators at CME Group over trades in Treasury futures four years ago while he was employed by Goldman Sachs, according to a regulatory filing. Hadden is a managing director and head of global interest rates products at Morgan Stanley. Prior to joining Morgan Stanley, Hadden was a partner at Goldman Sachs, and head of government bond trading. Hedge Funds Increase Bullish Bets Most Since August (Bloomberg) Hedge funds increased bullish bets on commodities by the most since August as evidence that China is accelerating outweighed concern that U.S. lawmakers have yet to resolve an impasse over automatic spending cuts and tax rises. Krawcheck, possible SEC head, raises Washington (Reuters) ...many who have worked with her say Krawcheck was a smart, analytical and competent executive who not only knew the business, but was good at building consensus among different units of companies. She helped restore brokerage Smith Barney's reputation at Citigroup and was popular with many of the financial advisers at Merrill Lynch. Schumer and other lawmakers contacted by Reuters did not return calls or requests for comment about meetings with Krawcheck or their thoughts about her. In the end, of course, Krawcheck may not land in Washington at all, two people who know her said. She has had discussions about a variety of roles with several companies, one source said. "She has lots of balls in the air," said the source, who asked not to be named because the conversations were private. "Sallie always has a plan." Bret Easton Ellis mistakenly asks for cocaine on Twitter (DJ) Bret Easton Ellis, famed author of "American Psycho," tweeted a request for cocaine Sunday morning, leaving many to speculate that it was supposed to be a private message...“Come over at do bring coke now,” he tweeted at 3:44AM, stranding his 360,000 followers in a state of bewilderment regarding what the cryptic tweet could possibly mean.

Opening Bell: 12.18.12

Dozens Likely Implicated In UBS Libor Deal (FT) bout three dozen bankers and senior managers will be implicated in the alleged rigging of Libor interest rates when UBS settles with global regulators later this week, according to people familiar with the matter. UBS is close to finalizing a deal with UK, US and Swiss authorities in which the bank will pay close to $1.5 billion and its Japanese securities subsidiary will plead guilty to a US criminal offence. Terms of the guilty plea were still being negotiated, one person familiar with the matter said on Monday, adding that the bank will not lose its ability to conduct business in Japan...Not all of the three dozen individuals will face criminal or civil charges and the level of alleged misconduct varies among them. While it also is not clear how many bankers will be criminally charged, people familiar with the investigation said the settlement documents will document an intercontinental scheme to manipulate the Yen-Libor interest rate over several years involving desks from Tokyo to London. Cerberus Seeks Sale of Gun Maker Freedom Group (WSJ) Private-equity firm Cerberus Capital Management LP said it is seeking to sell the company that manufactures a gun used in last week's shooting at Sandy Hook Elementary School in Newtown, Conn. "We have determined to immediately engage in a formal process to sell our investment in Freedom Group…We believe that this decision allows us to meet our obligations to the investors whose interests we are entrusted to protect without being drawn into the national debate that is more properly pursued by those with the formal charter and public responsibility to do so," Cerberus said in a statement Tuesday. Cliff Talks Narrow (WSJ) President Barack Obama backed away from his long-standing call for raising tax rates on households making more than $250,000 a year, a development that inches the White House and congressional Republicans closer to a budget deal. Mr. Obama's move, a counter to Republicans' recent proposal to raise tax rates on income over $1 million, further narrows the differences between the two sides. During a meeting with House Speaker John Boehner (R., Ohio) Monday the president proposed allowing Bush-era tax rates to expire for households making more than $400,000 in annual income, people familiar with the meeting said. Poland Finds It's Not Immune To Euro Crisis (NYT) During much of the region’s debt crisis so far, Poland has counted itself fortunate that the troubles began before the country had joined the euro currency union. By being part of the E.U.’s common market, but not bound by euro strictures, Poland has been one of the Continent’s rare economic good-news stories. But the deceleration in Polish growth, which has prompted the central bank to begin a series of interest rate cuts to stimulate the economy, has underscored the country’s exposure to slumping euro zone consumer markets. Hedge Fund Managers Convicted of Insider-Trading Scheme (Bloomberg) Level Global Investors LP co-founder Anthony Chiasson and former Diamondback Capital Management LLC portfolio manager Todd Newman were convicted of securities fraud and conspiracy for an insider-trading scheme that reaped more than $72 million. After deliberating a little more than two days, a federal jury in New York found both men guilty of conspiracy to commit securities fraud for a scheme to trade on Dell Inc. (DELL) and Nvidia Corp. (NVDA) using illicit tips. The panel found Chiasson, 39, guilty of five counts of securities fraud, earning Level Global $68.5 million on inside tips trading on the two technology company stocks. Newman, 48, was convicted of four counts of securities fraud related to trades on inside information that earned his fund about $3.8 million. “We had all the evidence we needed,” said Felicia Rivera, a juror from Westchester County near New York City, said after court. Credit unions sue JPM for $3.6B (NYP) The nation’s credit-union watchdog sued JPMorgan for a second time yesterday over $3.6 billion of Bear Stearns mortgage bonds that imploded in the wake of the financial crisis. The suit brought by the National Credit Union Administration accuses Bear Stearns, the failed bank acquired by JPMorgan in 2008, of peddling toxic securities to four credit unions that later collapsed. The same government agency sued JPMorgan last year over $1.4 billion in mortgage-backed securities that led to losses for credit unions. That suit is still pending. In the latest complaint, the credit union regulator said Bear Stearns conspired with at least 16 outfits that cranked out toxic mortgages and securities sold to unsuspecting buyers. Those included notorious subprime mortgage outfits such as Countrywide Financial, New Century and People’s Choice Home Loans. Man wears 70 items of clothing at airport to avoid baggage charge (DS) A man took to putting on 70 items of clothing to avoid an extra baggage charge at an airport. The unidentified passenger turned up at Guangzhou Baiyun International Airport in China, described as looking like a 'sumo wrestler'. According to Guangzhou Daily, the man's luggage exceeded the weight limit. He did not want to pay the extra baggage costs, and thus took out and wore more than 60 shirts and nine pairs of jeans. Wanting to board a flight to Nairobi, Kenya, he was stopped by the metal detector and had to undergo a full body search. AIG Raises $6.45 Billion as AIA Priced in Top Half of Range (Bloomberg) AIG sold 1.65 billion shares at HK$30.30 each, AIA said in a statement today. The shares were offered at HK$29.65 to HK$30.65 each. AIA fell 3.3 percent to close at HK$30.60 in Hong Kong, the most since July 23. It was the biggest decliner and most actively traded stock by both volume and value in the city’s benchmark Hang Seng Index (HSI) with HK$56.6 billion ($7.3 billion) worth of shares changing hands today. Probe Sparks Split On Trades (WSJ) A regulatory investigation into whether stock exchanges have given unfair advantages to high-speed traders has sparked complaints against the exchanges, fueling a broader debate about how the market operates and is regulated. The Investment Company Institute, trade group for mutual funds, complained in a recent letter to the Securities and Exchange Commission that U.S. stock exchanges "facilitate strategies" for rapid-fire trading firms "that can lead to disorderly markets or that can benefit market participants at the expense of long-term investors." Buybacks Rule The Day (WSJ) American companies bought back $274 billion more shares than they issued in the year through September, according to Ed Yardeni, president of investment advisory firm Yardeni Research. And the spending spree looks set to continue, a sign that companies have the cash to put to work but don't yet see an economic case for using it to expand their businesses or create jobs. Dog swallows a foot of Christmas lights (Mirror) Charlie, a seven-year-old crossbreed dog from Southampton, was saved by surgeons from veterinary charity PDSA after wolfing down his family's Christmas lights recently. And the dog has a track record for getting his paws, and teeth, on household objects, having once eaten his owner Sharon Fay's scarf. Ms Fay, who aptly refers to her dog as the "light of her life", became concerned when she noticed bits of wire sticking out of Charlie's faeces in the garden. The 45-year-old said: "I hadn't even noticed that the lights had been chewed at this stage but it quickly became clear what had happened. "Back in March he ate one of my scarves and needed an operation to remove it, but I thought it was just a one-off incident as he hadn't shown any signs that he was going to be a repeat offender. I've had dogs all my life and have never known a dog act like this before." An X-ray immediately cast a light on Charlie's problem - the tangled remains of the decorations clearly showed up in his stomach and would have proved fatal if they were not removed. Vets rushed Charlie to the operating table and removed the Christmas decorations, also finding a shoelace.

Opening Bell: 03.15.13

JPMorgan Pay Fueled Risk Amid London Whale Loss: Report (Bloomberg) JPMorgan, the biggest U.S. bank by assets, compensated chief investment office traders in a way that encouraged risk-taking before the unit amassed losses exceeding $6.2 billion, a Senate committee said. Pay that rewarded “effective risk management” would have suggested the synthetic credit portfolio functioned as a hedge, the Senate Permanent Subcommittee on Investigations said yesterday in a report on the New York-based bank’s so-called London Whale loss. Instead, compensation practices suggest the bets “functioned more as a proprietary-trading operation.” JPMorgan Report Piles Pressure on Dimon in Too-Big Debate (Bloomberg) Dimon misled investors and dodged regulators as losses escalated on a “monstrous” derivatives bet, according to a 301-page report by the Senate Permanent Subcommittee on Investigations. The bank “mischaracterized high-risk trading as hedging,” and withheld key information from its primary regulator, sometimes at Dimon’s behest, investigators found. Managers manipulated risk models and pressured traders to overvalue their positions in an effort to hide growing losses. Ina Drew Says Subordinates’ Deception at JPMorgan Let Her Down (Bloomberg) Ina Drew, who was forced to leave JPMorgan Chase amid a record trading loss last year, said she relied on other executives to manage a complex book of credit derivatives and didn’t learn of their “deceptive conduct” until after she left the company. “I was, and remain, deeply disappointed and saddened to learn of such conduct and the extent to which the London team let me, and the company, down,” Drew said in testimony prepared for delivery in the Senate today. Credit Suisse Banker Extradited To US (NYP) Former Credit Suisse banker Kareem Serageldin, the highest-ranking Wall Street executive to be charged for crimes tied to the mortgage meltdown, is coming home to face the music, The Post has learned. The 39-tear old Yale graduate was indicted by a Manhattan federal grand jury in February 2012 — along with two Credit Suisse colleagues — for allegedly covering up losses in a $3.5 billion toxic mortgage portfolio as the real estate market was collapsing in 2007. The UK’s Home Secretary Theresa May, who is responsible for Great Britain’s immigration and citizenship, signed off last week on the extradition of Serageldin, a person with knowledge of the case told The Post. Goldman Sachs, JP Morgan Hit (WSJ) The Federal Reserve Thursday dealt a blow to J.P. Morgan Chase and Goldman Sachs, citing weaknesses in their "stress test" capital planning that could hamper their funneling more dividends and share buybacks to investors. The central bank also denied capital plans submitted by BB&T Corp. and Ally Financial Inc. But the Fed at the same time cleared 14 other banks to boost payouts to shareholders, including Citigroup Inc. and Bank of America Corp., both of which in past years had capital requests rejected by the central bank. The Fed also approved a reduced repurchase plan from American Express Co., in the only instance of a bank winning approval for a plan resubmitted to the regulator under a new stress-test wrinkle this year. Mila Kunis Rotates From Cash to Stocks (CNBC) The star of films such as Ted, Friends With Benefits and the TV series That 70s Show told CNBC in London: "I've just started investing in stocks, which is new for me." "I'm an advocate of like put things in the bank, put it in a CD (a certificate of deposit), be safe. And I've been pushed kind of forward to take chances and then learning a little bit about the stock market and companies," she said. Abe Says Japan Will Join Trade Talks (WSJ) Japanese Prime Minister Shinzo Abe announced Friday that his country will take a seat at the negotiation table of the U.S.-led Trans-Pacific Partnership free trade negotiations, a move that may pit him against powerful farm lobbies ahead of upper house elections this summer. "This is our last chance to join the TPP and take part in the rule-making," Mr. Abe told reporters Friday at a news conference to mark his decision to join the talks. "For Japan to remain inward-looking means we are giving up on the possibility of growth." Stifel Agrees to Acquire Fixed-Income Group From Knight (Bloomberg) Knight’s European institutional fixed-income sales and trading team is also part of the deal, which includes about 100 people, Stifel said today in a statement, without disclosing terms. The group covers high-yield and investment-grade corporate bonds, asset-backed and mortgage-backed securities, emerging markets and fixed-income research. No 'Irrational Exuberance' in Stocks Now: Greenspan (CNBC) Greenspan said in a "Squawk Box" interview that stocks by historical standards are "significantly undervalued" even considering the recent moves higher. He added that the payroll tax increase didn't dent spending because of rising asset prices. Could Hungary Be Thrown Out of the EU? (CNBC) Hungary's increasingly aggressive moves against media, judiciary and central bank independence will be discussed by European Union heads of states on Friday, raising the possibility that Hungary could be thrown out of the EU. The European Union is concerned Hungary may be flouting EU rules on human rights, after its parliament voted this week to amend its constitution to allow legislation to bypass approval from the constitutional court. Hungary had defied calls from the European Commission to delay the vote. The Taco That Built 15,000 Jobs (ABC) It may take a village to raise a child. But all it takes to raise employment is a taco. That seems to be the situation at Taco Bell, anyway, which added 15,000 employees last year, company chief executive Greg Creed told the Daily Beast, largely on one new product. Creed attributes the success to Doritos Locos Tacos, which the company rolled out in March, 2012 and was the “biggest launch in Taco Bell history,” he told the Beast. Throughout 2012, the 170-calorie taco, whose shell is made from a nacho cheese Doritos in a collaboration with Frito-Lay, 375 million were gobbled up, which averages out to about one million per day. But why stop there? On March 7, it launched Cool Ranch Dorito Locos Tacos. The slogan? “Collect All Two.” “We believe we can add 2,000 new restaurants in the next 10 years, because what we have is proprietary and exclusive. Nobody else can make a Cool Ranch Doritos Taco. And that’s just in the U.S.,” Creed told the Beast. Creed was traveling today and unavailable to talk to ABC News, a spokesman said.

Opening Bell: 10.03.12

JPMorgan Rivals Face Billions in Damages After MBS Case (Bloomberg) A state-federal task force set up this year to investigate misconduct in the bundling of mortgage loans into securities will bring other cases, according to New York Attorney General Eric Schneiderman. Investor losses in the JPMorgan case alone will be “substantially more” than the $22.5 billion cited in his complaint, he said. “We do expect this to be a matter of very significant liability, and there are others to come that will also reflect the same quantum of damages,” Schneiderman said in an interview yesterday with Bloomberg Television’s Erik Schatzker. “We’re looking at tens of billions of dollars, not just by one institution, but by quite a few.” IMF Chief Economist Says Crisis Will Last A Decade (Reuters) FYI. Private Sector Adds 1620,000 New Jobs (WSJ) The September number was slightly above the 153,000 expected by economists. The August estimate was revised down to 189,000 from the 201,000 reported last month. Commodities' Engine Stalls (WSJ) Some investors have turned away from commodities that are heavily dependent on Chinese demand, such as base metals, cotton and soybeans. Others are searching for areas that will continue to expand no matter what happens in China, such as the U.S. natural-gas market. And some are simply getting out of commodities completely. Study Shows Baldness Can Be A Business Advantage (WSJ) Up for a promotion? If you're a man, you might want to get out the clippers. Men with shaved heads are perceived to be more masculine, dominant and, in some cases, to have greater leadership potential than those with longer locks or with thinning hair, according to a recent study out of the University of Pennsylvania's Wharton School. Some executives say the style makes them appear younger—or at least, makes their age less evident—and gives them more confidence than a comb-over or monk-like pate. "I'm not saying that shaving your head makes you successful, but it starts the conversation that you've done something active," says tech entrepreneur and writer Seth Godin, 52, who has embraced the bare look for two decades. "These are people who decide to own what they have, as opposed to trying to pretend to be something else." Wharton management lecturer Albert Mannes conducted three experiments to test peoples' perceptions of men with shaved heads. In one of the experiments, he showed 344 subjects photos of the same men in two versions: one showing the man with hair and the other showing him with his hair digitally removed, so his head appears shaved. In all three tests, the subjects reported finding the men with shaved heads as more dominant than their hirsute counterparts. In one test, men with shorn heads were even perceived as an inch taller and about 13% stronger than those with fuller manes. The paper, "Shorn Scalps and Perceptions of Male Dominance," was published online, and will be included in a coming issue of journal Social Psychological and Personality Science. BlackRock Leads Firms Poised to Win From Hedge Fund Ads (Bloomberg) The Jumpstart Our Business Startups Act, signed into law by President Barack Obama in April, ended a ban on the advertising of non-registered securities as part of an effort to expand funding options for startup companies. The law may give the biggest advantage to firms with trillions of dollars in assets and create a divide between asset managers that offer hedge funds, private equity and other alternatives and those that don’t, such as traditional mutual-fund companies. The Glory Days of Currency Trading Are Over: HSBC (CNBC) “In the glory days of carry, the FX market had the luxury of a clear framework for understanding and trading currencies,” the report, led by David Bloom Global Head of FX Strategy at HSBC, begins. “Life for FX market was simple. Get your interest rate calls correct, and you could both understand and trade the FX markets….In the low inflation environment, higher short rates meant a stronger currency and vice-versa…FX was beautiful. It was clear, liquid and transparent,” the report surmises. Fast forward through five years of global economic crisis and central banks ranging from the Federal Reserve to the Bank of Japan have introduced near-zero interest rates and quantitative easing in an attempt to stimulate economic growth creating “a problem for markets,” the report says. Einhorn Says No Quiero, Chipotle (NYP) In a packed conference room in Times Square yesterday, Einhorn joked that thanks to its new Cantina Bell menu, which boasts healthier options, Yum Brands’ Taco Bell is starting to “eat Chipotle’s lunch." No Joy On Wall Street (Bloomberg) “We may be on the verge of a new kind of banking crisis, and that’s a banking crisis where no one wants to own any banks as an investor,” said John Garvey, head of the financial- advisory practice at PricewaterhouseCoopers LLP in New York. “The future looks very dim.” Brooklyn assistant principal exchanged 2,919 text messages with high school student (NYDN) In a report to schools Chancellor Dennis Walcott, Richard Condon, special commissioner of investigation for the New York City School District, revealed other students witnessed questionable behavior by Del Re. The students claimed they saw Del Re playing with the young woman’s hair and leaving the Manhattan Beach school’s parking lot with her in his car. Both Del Re and the student in question told investigators that their relationship never went beyond texting and talking. “Del Re said that he never touched” the student, according to Condon’s report. Investigators examined Del Re’s cell phone and found he had texted the girl 1,442 times between Nov. 2, 2011, and Jan. 31, while the student texted him 1,477 times. It averages out to 1.3 text messages per hour between them for 91 days.

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."

Opening Bell: 01.07.13

Regulators Give Ground To Banks (WSJ) Global banking regulators watered down a key element of their plan for creating a safer financial system, giving ground to banks that argued the rules were unworkable and financially risky. The Basel Committee on Banking Supervision, a group of the world's top regulators and central bankers, said Sunday that it agreed to relax a rule designed to ensure that big banks are able to weather financial crises without running short of cash. Bowing to two years of intense pressure from the banking industry, the regulators made it easier for banks to meet the rule, known as the "liquidity coverage ratio," and delayed its full implementation until 2019. It is the latest instance of regulators chipping away at their landmark 2010 response to the global financial crisis. The regulators argue that the changes make banking rules much stronger than they were before the crisis. Herbalifers Stay Resolute (WSJ) When hedge-fund manager William Ackman unveiled his 334-slide presentation alleging that Herbalife is a pyramid scheme, it did nothing to shake Joanne Clare. The 38-year-old Staten Island mother of three has been selling the company's weight-loss products and supplements since 2004, when she says they helped her drop from 210 to 160 pounds in four months. She now sells as much as $3,500 a month of Herbalife products to her 30 clients and the two distributors in her "down line." "People have always said it's a pyramid scheme, but it's not," Ms. Clare said, adding that the bulk of her earnings come from sales to clients, not her cut of her recruits' take. Mr. Ackman's declaration that he had bet more than $1 billion against Herbalife caused many investors to flee, sending the stock down 38% in four days in late December. But some of the company's 3.1-million-strong army of distributors were unmoved. Eliot Spitzer Ends His Show On Current TV (NYT) The announcement comes a few days after Al Jazeera said it was acquiring Current TV. Later this year, the Qatar-owned broadcaster plans to turn the channel into an Americanized version of the international news channel Al Jazeera English. Mr. Spitzer said he had a “wonderful time” at Current, but emphasized that his relationship was with Al Gore and Joel Hyatt, Current’s co-founders, not with Al Jazeera. “Moving forward, their mission will be different,” he said — more international newscasts, less liberal talk about the news. Citi's Corbat builds bridges (Reuters) Citigroup Inc's Michael Corbat has been meeting with bank regulators in his first months as CEO, as he looks to bolster relationships and finalize the bank's plan to return capital to shareholders, sources familiar with the matter said. Corbat also expects to name his team of top managers within the next week or so, one of the sources said on Sunday. Corbat is expected to play it safe when Citigroup asks the U.S. Federal Reserve for permission for moves such as buying back shares or increasing dividends, analysts and investors said. His predecessor, Vikram Pandit, lost his job in October in part because the bank's request for returning capital was denied in March. The bank, which is due to submit its plan to the Fed on Monday, has not yet done so, the source said. The third-largest U.S. bank will only seek approval to buy back shares and not raise dividends, the Wall Street Journal reported on Friday. Last year, the bank wanted permission to return more than $8 billion to shareholders over two years, the paper said. For Newly Minted MBAs, A Small Paycheck (WSJ) For graduates with minimal experience—three years or less—median pay was $53,900 in 2012, down 4.6% from 2007-08, according to an analysis conducted for The Wall Street Journal by PayScale.com. Pay fell at 62% of the 186 schools examined. Even for more seasoned grads the trend is similar, says Katie Bardaro, lead economist for PayScale.com. "In general, it seems that M.B.A. pay is either stagnant or falling," she says...It is all a far cry from the late 1980s and early 1990s heyday for M.B.A.s, when some companies would hire 100 or more M.B.A.s. It wasn't uncommon to recruit first, and fill actual jobs later. DOJ pledges to respect Swiss law in tax probe (Reuters) Swiss chief finance diplomat Michael Ambuehl was given a verbal pledge from the U.S. Department of Justice to respect Swiss law when asking for bank client data of potential tax dodgers, a newspaper reported on Sunday. Switzerland is in negotiations with U.S. authorities to find a deal that would end tax probes into at least ten Swiss banks suspected of helping clients dodge taxes, including Credit Suisse and Julius Baer. The Alpine country is trying to preserve what is left of its cherished banking secrecy that suffered a severe blow in 2009 when UBS, the first Swiss bank that came under scrutiny in the U.S., was required to disclose client data. Brazilian prison gaurds catch cat that slipped through the gate with escape tools taped to its body (NYDN) Guards at a Brazilian prison nabbed a white cat that slipped through the gate with a cell phone, drills, small saws and other contraband taped to its body. Alagoas prison spokeswoman Cinthya Moreno says the cat was caught New Year’s Eve at the medium-security prison in the city of Arapiraca. The O Estado de S. Paulo newspaper reported Saturday that all of the prison’s 263 inmates are suspects in the smuggling attempt, though a spokesperson said, “It will be hard to discover who is responsible since the cat does not speak.” Loeb, Cooperman Stand Out in Horrid Year for Hedge Funds (CNBC) Third Point was the clear hedge fund standout in a horrible year for the industry as almost nine out of 10 managers underperformed the S&P 500. Omega Advisors' Leon Cooperman also scored big. Loeb — once better known for his acerbic letters to CEOs — used an activist position in Yahoo and the contrarian buying of Greek bonds to drive the firm's flagship fund to a 21 percent gain in 2012. The firm's more-leveraged Ultra fund posted an even bigger 34 percent return...Cooperman's fund had a net return of 26 percent in 2012. Banks Zero In On Foreclosure Pact (WSJ) Banks were closing in on a $10 billion foreclosure-abuse settlement with regulators that could be announced as soon as Monday, according to people familiar with the talks. The settlement was nearly complete Sunday afternoon, the people said, after the Federal Reserve backed down on a demand for more compensation for consumers and other changes to the pact. Bankers threatened to walk away from the deal if the Fed's demand for an additional $300 million was included, a person briefed on the talks said. Junk Bonds' Fire Is Poised to Fade (WSJ) Junk bonds started 2013 much like they finished 2012—on fire. In just three trading days this year, bonds of low-rated companies delivered returns of almost three-quarters of a percent, even as most other types of bonds lost value. And junk bonds continued to clock new milestones: Average prices soared to their highest since 2004 and average yields, which decline as prices rise, dropped below 6% for the first time ever, according to Barclays. But the rapid march is making fund managers and analysts wary. Prices are now so high—averaging more than 105 cents on the dollar—that there is little room for them to climb much further, some investors say. These are lofty prices for bonds that usually trade below 100 cents, reflecting the higher default risk for such companies. At the very least, returns will pale in comparison with the 15% achieved in 2012, analysts and investors say. NHL, Players Settle Labor Dispute (AP) On the 113th day of a management lockout and five days before the league's deadline for a deal, the bleary-eyed sides held a 6 a.m. news conference to announce there will be a season, after all. NHL Commissioner Gary Bettman and union head Donald Fehr both appeared drained, wearing sweaters and not neckties, when they stood side by side at the hotel and announced labor peace. "We have reached an agreement on the framework of a new collective bargaining agreement, the details of which need to be put to paper," Bettman said. "We've got to dot a lot of Is, cross a lot of Ts. There's still a lot of work to be done, but the basic framework of the deal has been agreed upon." Hostess in Talks to Sell Off Bread Brands (WSJ) Hostess could disclose Flowers, Grupo Bimbo or others as opening bidders in a looming bankruptcy-court auction for the assets as soon as this week, said people familiar with the matter. Hostess, whose bread brands include Wonder Bread, Nature's Pride, Home Pride, Merita and Butternut, is still determining how to split up assets and package them for buyers, one of the people said. Gérard Depardieu gives up French citizenship after bitter tax fight (GM) In a fit of pique, French movie star Gérard Depardieu announced during the weekend that he would give up his citizenship after politicians and the media took him to task for moving to Belgium and avoiding an impending tax hike for the rich. Mr. Depardieu is not France’s first fiscal refugee but his high-profile door-slamming so monopolized public debate that Prime Minister Jean-Marc Ayrault had on Monday to parse whether or not he had insulted the actor. “I did not call Mr. Depardieu a loser, I said that it was loser-like [to move to Belgium to avoid taxes],” Mr. Ayrault told reporters...The “loser” comment seemed to have been the jab that stung Mr. Depardieu the most. “Loser, did you say loser?” the 63-year–old actor began an open letter to Mr. Ayrault that appeared Sunday in Le Journal du dimanche. Mr. Depardieu wrote that he had paid a total of €145-million in income tax in the last four decades and kept 80 people employed. He added that he had been taxed at a marginal rate of 85 per cent this year. “I am giving you back my passport and my social insurance, which I had never used. We no longer have the same fatherland. I am a true European, a citizen of the world.”

Opening Bell: 02.08.13

Barclays CEO’s Ethics Talk Drowns Out Silence on Profit (Bloomberg) Jenkins, who took over after Robert Diamond departed in the wake of the bank’s fine for rigging Libor, is set to reveal the conclusions of his six-month review of the lender’s operations at London’s Royal Horticultural Halls on Feb. 12. While he may cut about 2,000 jobs, pledge to reform culture and reduce pay to boost returns, he’s unlikely to follow UBS AG and eliminate entire business lines, according to investors and analysts. That’s because the securities unit that Diamond built out of the remains of Barclays De Zoete Wedd over the 15 years from 1996 still contributes about half of the lender’s profit. Meredith Whitney Pans New Citi Chief Corbat (NYP) “He didn’t give us an agenda and he didn’t even give us a stamp for when he’s going to give us an agenda, so it left people a little bit uninspired,” she said during an interview with Bloomberg TV yesterday. Deutsche Bank Said to Fire 10 Traders as Banks Retrench (Bloomberg) Deutsche Bank AG fired between 10 and 12 European power and natural gas traders in London as it cuts staff trading physical commodities, two people with knowledge of the matter said. There are at least two traders still unwinding positions as Europe’s biggest lender is reducing trading in physical energy markets, said the people, who asked for anonymity because the information is private. Nick Bone, a company spokesman in London, declined to comment when reached yesterday by phone. Buffett’s Son Says He’s Prepared Whole Life for Berkshire Role (Bloomberg) Protecting Berkshire’s culture “means that I need to make sure that people feel that they’ve been treated fairly, that whatever my dad committed to them remains committed,” Howard Buffett, 58, said in an interview with Bloomberg Television’s Betty Liu, airing today. The younger Buffett is a director of Coca-Cola Co., the world’s largest soft-drink maker, and once was the head of investor relations for Archer-Daniels-Midland Co. He said observing his father has helped him get ready to lead a board that also includes Microsoft Corp. co-founder Bill Gates and Stephen Burke, CEO of Comcast Corp.’s NBC Universal unit. “In a way, I’ve been preparing for it all my life,” Buffett told Liu. “In another way, I’ve been on the Berkshire board now 20 years. That’s a preparation.” Justin Timberlake Named Creative Director of Bud Light Platinum (Billboard) As part of the deal, Timberlake will be charged with providing “creative, musical and cultural curation” for the Bud Light Platinum brand, per a press release announcing the partnership. Additional terms were not disclosed. “Bud Light Platinum brings a refined, discerning aesthetic to beer that plays well with what I'm doing,” Timberlake said in a statement. Monte Paschi says considering legal action to protect business (Reuters) talian bank Monte dei Paschi said on Friday it is considering legal action against anyone who damages its commercial activity or spreads false information about the bank. In a statement, the bank said it had become the target of "attacks of various kinds involving, in certain circumstances, employees, creating considerable problems in the normal course of business. It said it was considering civil and penal action. Audacious Hack Exposes Bush Family Pix, E-Mail (TSG) The hacker also intercepted photos that George W. Bush e-mailed two months ago to his sister showing paintings that he was working on, including self-portraits of him showering and in a bathtub. Another image shows the former president painting at the family’s Maine retreat. Goldman Readies Fund Business For 'Volcker' (WSJ) For 20 years, Goldman wooed clients to invest in its private-equity funds with the security blanket that the bank and its partners went along for the same ride. But that is about to change. The looming "Volcker rule" is expected to sharply reduce the bank's investment in its own funds. That is forcing Goldman to make major changes in a $50 billion business that has reaped big profits for the bank and its employees and clients. Goldman likely will have to shrink the size of its own investment in its funds to just 3% from as much as 37% once the rule is finalized later this summer. The rule, part of the Dodd-Frank financial-overhaul law and named after former Federal Reserve Chairman Paul Volcker, aims to restrict banks from making big bets with their own money. Goldman expects new funds it raises will be considerably smaller. The New York bank also will change the name of the business to avoid referencing its own name. GS Capital Partners and future funds may become "Broad Street," referring to both the firm's old headquarters and its first leveraged-buyout fund launched in 1986, according to people involved in the business. Ex-Tyco chief gets another chance at parole (NYP) Kozlowski was denied parole in April when state officials tossed out his application saying his release was not "compatible with the welfare of society at large." But in a ruling made public today, Justice Carol Huff this week called that decision "an unauthorized re-sentencing" of Kozlowski, adding that it lacked specifics. In making its decision, she said, the parole board must consider other factors beyond the crime including the inmate's institutional record, which the tycoon asserted is exemplary. The Politics Of Chris Christie's Weight (WSJ) The latest chatter about Mr. Christie's heaviness began on the "Late Show With David Letterman," when he pulled out a pastry and began eating as the comic asked whether his frequent jokes about the overweight Republican were offensive. The day after the good-natured stunt, Mr. Christie opened up about his struggles to lose weight. Later, a former White House physician, Connie Mariano, said she worried his weight made him a "time-bomb" at risk of dying in office. Mr. Christie quickly shot back, calling Dr. Mariano a fame-seeking "hack" who didn't know his health history and was needlessly worrying his children. On Thursday, Dr. Mariano, who attended to presidents George H.W. Bush, Bill Clinton and George W. Bush, said she stood by her assessment. "When I see someone of that size, I worry about various medical issues," she said. "It was not meant to be an attack on him personally."