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TikTok CEO Kevin Mayer quits following Trump's threat to ban the app [CNN Business]
"In recent weeks, as the political environment has sharply changed, I have done significant reflection on what the corporate structural changes will require, and what it means for the global role I signed up for," Mayer said in a memo to employees that was obtained by CNN Business…. TikTok hired Mayer, a former top Disney executive, less than four months ago to run the app, which is the first owned by a Chinese company to gain significant traction in western countries.

U.S. Warns of Global Bank Heist Campaign by North Korean Hackers [WSJ]
The campaign includes so-called spearphishing attacks—which use fraudulent email to infect a computer or persuade the victim to reveal a password or other information—and social engineering schemes. It has been under way since at least February and represents a resurgence of operations after an apparent lull in bank robberies by North Korea last year…. U.N. investigators say the complexity of the orchestrated ATM thefts across dozens of countries shows North Korea’s cyber capabilities have become dangerously sophisticated.

Bridgewater Is Having a Bad Year. David McCormick Has a Plan. [II]
“If you look at the history of Bridgewater since 1991, we’ve had five drawdowns — including our drawdown of March — of equal magnitude,” McCormick says, referencing the firm’s dreadful pandemic performance. “And if you look at the period that followed each of them, you’ll see a pretty significant compounding of return over that period.” The dark periods also spur “reflection, innovation, a series of things that came as a consequence of reassessment. That’s the process we’re in now….”
“There is a shift coming,” he says. “Part one of that shift is to narrow the scope of the clients that we’re going deeper with in these custom advisory relationships. Even if our assets grow substantially, the number of clients will likely decrease.”

It Pays To Invest in Unpopular Hedge Funds [II]
Academic researchers found that in the five years after hedge funds launch, the strategies that were unpopular when the funds were raised outperformed the hottest strategies by 3 percent annually on a risk-adjusted basis…. To make up for choosing strategies that are out of favor, unpopular hedge funds must demonstrate more skill — and better returns — before they can successfully lure investors, the trio argued….
According to the paper, hedge fund firms with already-successful strategies are incentivized to launch new funds that are “clones” of their other funds. This reduces the cost of finding new investors and can help manage demand by funneling investors who are interested in other funds into new launches, the researchers argue.

Palantir’s Valley Shots Could Misfire [WSJ]
Palantir Technologies isn’t a Silicon Valley startup. It only burns money like one…. In a letter to shareholders included in its first filing for a direct stock listing Tuesday, co-founder and Chief Executive Alex Karp paints the “engineering elite of Silicon Valley” as a group comfortable with mining private data to sell advertising, but unwilling to engage in projects with defense and government agencies…. That distinction could prove important as the company makes its debut in public markets. Bernstein analysts noted in a report Wednesday that government contractors tend to command multiples barely above their projected revenue. Companies on the BVP Cloud Index currently average an enterprise value of nearly 15 times forward revenue.
Palantir also doesn’t offer the same sort of stratospheric growth rate as its younger, smaller software peers who will be competing for attention from IPO investors.

Navy SEAL Trader at Jefferies Helped Expose Hedge Fund Scandal [Bloomberg]
In the industry’s social hierarchy, a client who can offer or withhold significant business is usually king. Kamensky allegedly pressed that advantage by pushing [Jefferies distressed-debt trading head Joe] Femenia to abstain from submitting a rival bid for part of bankrupt retailer Neiman Marcus. But instead, Femenia raised alarms, providing enough details on the incident to a U.S. trustee to threaten Kamensky’s standing in the industry.
“I have known Joe and always found him to be an honest, upstanding guy and a straight shooter,” said Eric Rosen, a veteran trader and hedge fund executive. “He risked his life for our country and he seems to have done the honorable thing here….”
The panicked money manager called back Femenia a second time, asking him to treat the conversation off the books, and pushed Femenia to change his recollection of their initial chat, according to the report. Unbeknownst to him, Femenia had started recording the call.

Jeff Bezos Becomes The First Person Ever Worth $200 Billion [Forbes]
As of 1:50 p.m. EDT on Wednesday, the Amazon founder and CEO is worth $204.6 billion—nearly $90 billion more than the world's second-richest person, Bill Gates, who's currently worth $116.1 billion…. Fueled by the change in consumer habits as a result of the coronavirus pandemic, Amazon stock is up nearly 80% since the beginning of the year, and Bezos' net worth, which was roughly $115 billion on January 1, has skyrocketed in tandem. Bezos’ roughly 11% stake in Amazon makes up more than 90% of his fortune….
Bezos would be even richer had he not gone through the most expensive divorce settlement in history last year. When he split from ex-wife, MacKenzie Scott, last July, he agreed to give her 25% of his Amazon stake, a chunk of stock now worth $63 billion.

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Opening Bell: 11.5.20

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Opening Bell: 7.22.21

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Opening Bell: 1.11.21

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Opening Bell: 10.8.20

Charlie’s lament; Ackman SPAC-ing; TikTok twist; we couldn’t be more proud; and more!

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Opening Bell: 5.16.17

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Opening Bell: 9.10.20

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Opening Bell: 03.06.12

Goldman Secret Greece Loan Reveals Sinners (Bloomberg) On the day the 2001 deal was struck, the government owed the bank about 600 million euros ($793 million) more than the 2.8 billion euros it borrowed, said Spyros Papanicolaou, who took over the country’s debt-management agency in 2005. By then, the price of the transaction, a derivative that disguised the loan and that Goldman Sachs persuaded Greece not to test with competitors, had almost doubled to 5.1 billion euros, he said. Papanicolaou and his predecessor, Christoforos Sardelis, revealing details for the first time of a contract that helped Greece mask its growing sovereign debt to meet European Union requirements, said the country didn’t understand what it was buying and was ill-equipped to judge the risks or costs...“Like the municipalities, Greece is just another example of a poorly governed client that got taken apart,” Satyajit Das, a risk consultant and author of “Extreme Money: Masters of the Universe and the Cult of Risk,” said in a phone interview. “These trades are structured not to be unwound, and Goldman is ruthless about ensuring that its interests aren’t compromised -- it’s part of the DNA of that organization. Greece Pushes For Aid Tranche (WSJ) Greece's international creditors are considering whether to grant the country a small, tranche of the €130 billion ($171.8 billion) bailout agreed earlier this month in the weeks ahead as part of efforts to pump liquidity into the country's moribund economy. Speaking to the privately owned Mega television channel Tuesday, Deputy Finance Minister Philippos Sachinidis said the money would go to paying off some of the €6 billion in accumulated arrears that the Greek government owes private contractors. He added that the disbursement could come before Greece goes to elections that are widely expected to be held in late April. "There is a discussion that, likely before the elections, we will get a tranche that will allow us to pay some of, not the total, of the arrears," Mr. Sachinidis said. Bondholder Group Sees 1 Trillion Euro Greek Default Risk (Reuters) A disorderly Greek default would probably leave Italy and Spain needing outside help to stop contagion spreading and cause more than 1 trillion euros ($1.3 trillion) of damage to the euro zone, the group representing Athens' bondholders warned. Greek private creditors have until Thursday night to say whether they will take part in a bond swap that is part of a 130 billion euros bailout deal to put the country on a more stable footing and cut its debt by more than 100 billion euros. Paulson’s Advantage Plus Declines in February (Bloomberg) John Paulson lost 1.5 percent in February in one of his largest hedge funds, according to an investor update, paring this year’s gain and setting back efforts by the New York-based manager to recoup record losses in 2011. Paulson’s Advantage Plus Fund, which seeks to profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns, gained 3.5 percent in the first two months of 2012, according to the update IBM’s Watson Gets Wall Street Job After ‘Jeopardy’ Win (Bloomberg) International Business Machines Corp’s Watson computer, which beat champions of the quiz show “Jeopardy!” a year ago, will soon be advising Wall Street on risks, portfolios and clients. Citigroup, the third-largest U.S. lender, is Watson’s first financial services client, IBM said yesterday. It will help analyze customer needs and process financial, economic and client data to advance and personalize digital banking. Ann Romney: ‘I Don’t Even Consider Myself Wealthy’ (ABC) Mitt Romney may have more money than any other presidential candidate in the race, but his wife said today that she does not consider herself wealthy. “We can be poor in spirit, and I don’t even consider myself wealthy, which is an interesting thing,” Ann Romney said in an interview on Fox News. “It can be here today and gone tomorrow.” Swiss Pass Proposal to Help Nab US Tax Evaders (Reuters) Specifically, the plan would allow Switzerland to hand over data on suspected tax evaders, even if U.S. tax authorities cannot identify alleged offenders by name or bank account. The big-spending businessman who ran up £203,948 bar bill was 23-year-old City whizkid (Mirror) The businessman who blew £203,948 on bubbly in a single night in Liverpool was 23-year-old Alex Hope...His biography reads: “Despite his tender years, Alex is a name to watch out for in the city. An expert in the UK economy, he works the currency markets, regularly trading millions.” Describing his rapid career rise from humble beginnings to working for trading company Zone Invest Group, it adds: “A talented, charismatic and thoroughly likeable man, Alex Hope exudes knowledge and you can’t help but respect and admire this self-taught and self-made young trader.” Banker Bonus Limits Sought by EU Lawmakers (Bloomberg) Members of the European Parliament’s Socialist and Green parties have proposed that a draft EU law to bolster bank capital should include new pay rules, as well as stricter curbs on risk taking, according to two members of the institution’s financial affairs committee. “Wrong incentives were part of the banking culture that caused the crisis,” said Udo Bullmann, a German lawmaker following the proposed law for the parliament’s Socialist group. “I expect there will be quite a lot of sympathy among different party groups” for further rules on pay. Judge throws heat at Picard’s claim vs. Mets (NYP) Picard’s best evidence may be from Noreen Harrington, a former chief investment officer for a hedge fund partially owned by the Mets’ owners, who is expected to say that she told Katz and another Sterling Equities executive that she thought Madoff’s reported returns were “fiction” and not “worth the paper they’re written on.” The Mets will argue they were bamboozled by Madoff, along with the nation’s top regulators and major banks. Bill Clinton Said to Agree to Join Obama at Campaign Fundraisers (Bloomberg) While Obama raised $5 million on his last fundraising trip to New York, including $2 million from a March 1 event with members of the financial services industry, he is collecting less money from Wall Street this year compared with four years ago, according to the Center for Responsive Politics. When Gaming Is Good For You (WSJ) People who played action-based video and computer games made decisions 25% faster than others without sacrificing accuracy, according to a study. Indeed, the most adept gamers can make choices and act on them up to six times a second—four times faster than most people, other researchers found. Moreover, practiced game players can pay attention to more than six things at once without getting confused, compared with the four that someone can normally keep in mind, said University of Rochester researchers. The studies were conducted independently of the companies that sell video and computer games.

Opening Bell: 03.21.12

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