Opening Bell: 10.7.20 - Dealbreaker

Global markets struggle to make sense of Trump's stimulus tweet storm [CNN]
Just hours after Trump's decision to halt negotiations on a major economic stimulus package caused US stocks to plummet, he called on US lawmakers to approve smaller measures that would provide relief to airlines and small businesses….
"This appears to be a none too subtle effort to cherry-pick the bits of a fiscal stimulus plan that are directly vote-winning potentially," said Jeffrey Halley, senior market analyst for Asia Pacific at Oanda. "Whether the American public buys it or not is another thing altogether…."
US futures moved higher overnight, with the Dow, S&P 500 and Nasdaq on track to open with gains of roughly 0.6%. That followed a rocky ride Tuesday, when the Dow swung more than 600 points after Trump called off stimulus talks and closed down 376 points, or 1.3%, lower. The S&P 500 and Nasdaq Composite were also hammered.

Fed’s Powell Says U.S. Faces ‘Tragic’ Risks From Doing Too Little to Support Economy [WSJ]
“The expansion is still far from complete,” Mr. Powell said in his strongest remarks to date on the subject, delivered to a virtual conference of private-sector economists Tuesday. “At this early stage, I would argue that the risks of policy intervention are still asymmetric. Too little support would lead to a weak recovery, creating unnecessary hardship….” A prolonged slowdown in the pace of improvement could trigger “typical recessionary dynamics, as weakness feeds on weakness,” he said. Such a slowdown could exacerbate existing racial and wealth disparities in the economy, which “would be tragic, especially in light of our country’s progress on these issues in the years leading up to the pandemic,” Mr. Powell said.

House Lawmakers Condemn Big Tech’s ‘Monopoly Power’ and Urge Their Breakups [NYT]
Lawmakers said the four companies had turned from “scrappy” start-ups into “the kinds of monopolies we last saw in the era of oil barons and railroad tycoons.” The lawmakers said the companies had abused their dominant positions, setting and often dictating prices and rules for commerce, search, advertising, social networking and publishing.
To amend the inequities, the lawmakers recommended restoring competition by effectively breaking up the companies, emboldening the agencies that police market concentration and throwing up hurdles for the companies to acquire start-ups.

Fed Tenure Boosts Lael Brainard as Potential Biden Treasury Pick [WSJ]
After six months of forging the Fed’s pandemic response, she is one of the few Democrats intimately involved in responding to the crises of both 2008 and 2020, something political and economic analysts and people close to the Biden campaign said will boost her consideration as possible Treasury secretary…. “She’s been quite comfortable working behind the scenes and seems to be a team player,” said Jared Bernstein, who was Mr. Biden’s chief economist when he was vice president. “Her willingness to broaden her scope without being flashy is one of the reasons she has been effective.”

Billionaire hedge fund manager Ray Dalio shares his China strategy [CNBC]
“That means to achieve the right kind of balance of assets in China,” he said. “Our approach is, we call it all-weather approach, it’s a certain balance in which you achieve balance without lowering the expected return. From that, you want to make the tactical moves….”
Like China, Dalio said he believed India also has tremendous potential but it lags behind in the development of its capital markets.
“There’s much less liquidity in those markets, much less developed,” he said. Dalio explained that there are investment opportunities in the country in terms of many cutting edge technologies and entrepreneurship. But it is “tougher to invest in.”

UK watchdog bans Bitcoin-based products for retail investors [Reuters]
The Financial Conduct Authority said there was no reliable basis for valuing cryptoassets that underpin derivatives and exchange-traded notes.
The ban, which prompted surprise and anger in the sector, will come into force on Jan. 6, 2021.

Trump Took $70,000 in Tax Deductions for Hair Care. Experts Say That’s Illegal. [NYT]
Tax experts told me that deducting what is ordinarily considered a personal expense is prohibited under almost any circumstances. And they said such a deduction could potentially constitute criminal tax fraud if the cost of the hairstyling was reimbursed by someone else.
Three former NBC executives involved in “The Apprentice” told me that, while they didn’t recall the exact terms of Mr. Trump’s contract, they were very familiar with the way such contracts are typically written. The cost of hair and makeup for a star of Mr. Trump’s stature would generally be covered by the show, and Mr. Trump would have been reimbursed for any of the costs he incurred.

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Opening Bell: 3.19.18

Trump's tweets make stocks nervous; Brexit deal reached?; Jay Powell's no drama Fed; Man gives cop his Homer Simpson ID, hopes for the best; and more!

Opening Bell: 01.29.13

US Wants Criminal Charges For RBS (WSJ) U.S. authorities are pushing for a settlement of interest-rate-rigging allegations with Royal Bank of Scotland that would result in a unit of the big British bank pleading guilty to criminal charges in addition to paying a penalty, according to people briefed on the negotiations. RBS executives are resisting any guilty plea, fearful that it could lead clients to cut off activity with the bank and that it could increase exposure to costly litigation, some of these people said. The negotiations reflect a newly tough stance by U.S. authorities, who until recently have faced criticism for rarely pursuing criminal action against big banks.U.S. authorities are pushing for a settlement of interest-rate-rigging allegations with Royal Bank of Scotland Group RBS.LN +0.52% PLC that would result in a unit of the big British bank pleading guilty to criminal charges in addition to paying a penalty, according to people briefed on the negotiations. RBS executives are resisting any guilty plea, fearful that it could lead clients to cut off activity with the bank and that it could increase exposure to costly litigation, some of these people said. The negotiations reflect a newly tough stance by U.S. authorities, who until recently have faced criticism for rarely pursuing criminal action against big banks. IRS can seek UBS records for taxpayers hiding income at Wegelin (Reuters) A federal judge on Monday authorized the Internal Revenue Service to seek records from UBS AG of U.S. taxpayers suspected of hiding their income in accounts with Swiss bank Wegelin. Wegelin, the oldest Swiss private bank, pleaded guilty in Manhattan federal court on January 3 to charges of helping wealthy Americans evade taxes through secret accounts and then announced it would close down as a result. Little Debbie Maker to Buy Drake’s Brand, Hostess Says (Bloomberg) Hostess Brands Inc. said McKee Foods Corp., maker of Little Debbie snacks, agreed to pay $27.5 million for its Drake’s brand and United States Bakery Inc. offered to buy certain bread brands for $28.9 million. “The contemplated purchase prices for Drake’s and the four bread brands, together with our previous announced stalking- horse bid for the majority of our bread business, means we have agreements to sell these assets for at least $440 million,” Hostess Chief Executive Officer Gregory F. Rayburn said today in a statement. United States Bakery agreed to buy the Sweetheart, Eddy’s, Standish Farms and Grandma Emilie’s bread brands, four bakeries and 14 depots, plus certain equipment, according to court papers. Iceland Wins Case On Deposit Guarantees (WSJ) Iceland won a sweeping victory in a court fight over its responsibilities to foreign depositors in Icelandic bank Landsbanki, which failed in 2008. The court of the European Free Trade Association on Monday said Iceland didn't breach European Economic Area directives on deposit guarantees by not compensating U.K. and Dutch depositors in Landsbanki's online savings accounts, known as Icesave accounts. The EFTA Surveillance Authority, or ESA, which brought the case against Iceland, had claimed that Iceland should have made sure U.K. and Dutch savers who lost money on Icesave got repaid from deposit insurance. Jamie-Lynn Sigler engaged to Lenny Dykstra's son (NYDN) The actress who played Meadow Soprano announced on Twitter Monday that she's engaged to Cutter Dykstra, a baseball player with the Washington Nationals. "So this just happened," she tweeted along with a photo showing off her huge new diamond alongside her smiling fiancé. "Thank you so much for all the love everyone. I am so happy and more importantly lucky," Sigler, 31, said in a follow-up tweet. "She said yes!!" Cutter, 23, wrote on his own Twitter feed. Sigler was by Cutter's side last month when family members filed into a federal courthouse in downtown Los Angeles for Lenny Dykstra's sentencing in his bankruptcy fraud case. Yahoo Profit Drops But Revenue Rises (WSJ) For Ms. Mayer, the results were enough that the "honeymoon period is going to last at least a couple of more quarters" while investors wait to see progress, said Sameet Sinha, an analyst at B. Riley & Co. Mayor Bloomberg Has Opinions (NYDN) In a New York Magazine profile about Christine Quinn, the City Council Speaker and candidate for mayor, the author recalled being introduced to Bloomberg at what he described as “a Christmas party for the rich” on the Upper East Side. “My friend and I followed the host over, shook Bloomberg’s hand, and my friend thanked him for his position on gun control,” the author writes. “Without even acknowledging the comment, Bloomberg gestured toward a woman in a very tight floor-length gown standing nearby and said, ‘Look at the ass on her.’” According to the article, Bloomberg also has strong opinions about Quinn’s appearance – turning up his nose when she wears flats or waits too long before coloring her hair. “The mayor has no use for flat shoes,” Quinn told the reporter. “I was at a parade with him once and he said, ‘What are those?’ and I said, ‘They’re comfortable,’ and he said, ‘I never want to hear those words out of your mouth again,’” she recalled. “He likes me in high heels.” “Another big thing with the mayor, when I am rooting … like, the couple of days a week before I need to get my hair colored, he’ll say, ‘Do you pay a lot to make your hair be two colors? Because now it’s three with the gray,’” Quinn continued. TARP Firms' Pay Unchecked (WSJ) Christy Romero, the Special Inspector General for the Troubled Asset Relief Program, on Monday said the Treasury failed to look out for taxpayers by relying "to a great extent on the companies' proposals and justifications without conducting its own independent analysis." Ms. Romero also said the Treasury hasn't put in place policies that would ensure salaries are within guidelines designed to discourage excessive risk taking by companies receiving bailout aid. Bridgewater’s Dalio Sees ‘Game Changer’ as Money Shifts (Bloomberg) Ray Dalio, founder of Bridgewater Associates LP, the world’s biggest hedge fund, said 2013 will be a “game changer” for the economy as investors reallocate money after risks such as Europe’s sovereign debt crisis receded. “There’s a lot of money in a place that’s getting a very bad return and in this particular year there’s going to be, in my opinion, a shift,” Dalio said at a Bloomberg panel discussion at the World Economic Forum in Davos, Switzerland. “The complexion of the world will change as that money goes from cash into other things. The landscape will change, particularly later in the year and beyond.” Will the New BlackBerry Win Back Corporate Customers? (WSJ) Survey says: probably not but maybe, who knows. Credit Suisse Said to Seek to Sublet at Hong Kong Skyscraper (Bloomberg) If you know anyone who's interested: Credit Suisse is seeking to sublet as much as 64,000 square feet of office space in Hong Kong’s tallest skyscraper, as prime office vacancies rise in the city amid job cuts by global financial services companies. The Zurich-based bank is looking for tenants to take up two floors, or about a fifth of the space it currently occupies at the International Commerce Centre in West Kowloon, according to two people with knowledge of the matter, who declined to be identified because the information isn’t public. Woman accused of putting poison in her privates in bid to kill husband (Mirror) A woman is being sued by her husband for allegedly trying to kill him by putting poison in her genitals and then asking him to perform oral sex. The Brazilian wife is accused of planting a toxic substance on her genitals before luring her husband to bed. Reports in the South American country suggest he was ready and willing, and only escaped death because he noticed a strange smell. The curious husband then took his wife to hospital in Sao Jose do Rito Preto to find out the cause of the unusual odour. The alleged attempt on his life was exposed when tests on his wife discovered traces of a poisonous substance down below.