Biden Budget Said to Assume Capital-Gains Tax Rate Increase Started in Late April [WSJ]
Mr. Biden’s plan would raise the top tax rate on capital gains to 43.4% from 23.8% for households with income over $1 million…. “Anything that is retroactive creates extra anxiety and extra uncertainty, and that would just slow down economic activity,” said David Solomon, chief executive of Goldman Sachs Group Inc…. The rationale for retroactivity is that there is a long history of taxpayers accelerating capital gains before tax increases take effect. Capital-gains realizations jumped 60% in 1986 and 40% in 2012 before tax increases took effect

AMC's premarket surge of 20% leaves short sellers with new losses of $500 million, says Ortex [MarketWatch]
Shares of movie-chain operator AMC Entertainment climbed 20% in premarket trading, after jumping 36% on Thursday, and more than doubled over the last four days…. Total losses in AMC this week are $1.75 bilion so far.

Judge Allows Robinhood Customer-Protection Case to Proceed [WSJ]
Judge Salinger requested further information from both parties about whether Robinhood’s challenge to the fiduciary rule should move forward, or whether it should be paused pending the outcome of state regulators’ administrative complaint…. In allowing securities regulators’ administrative complaint to go forward, Judge Salinger noted that state securities regulators’ complaint against Robinhood included allegations of violations outside the fiduciary rule, and that it would “not be in the public interest” to enjoin prosecution of the other claims.

Archegos fallout hits market for blank-cheque companies [FT]
Banks across Wall Street have become more wary of how much leverage they can extend to their clients following the collapse of Archegos, the investment firm run by Bill Hwang, forcing hedge funds and family offices to reconsider their investments in Spacs…. The lack of leverage is foiling the investment strategies of hedge funds that have played a big role in fuelling the Spac boom, typically by investing at an early stage — and then not sticking around for long.

JPMorgan's Jamie Dimon: 'Buyer beware' on cryptocurrencies [Yahoo! Finance]
"My own personal advice to people is: stay away from it. That does not mean the clients don't want it,” Dimon said. “This goes back to how you have to run a business. I don't smoke marijuana but if you make it nationally legal, I'm not going to stop our people from banking it…."
“I don't tell people how to spend their money, regardless of how I might personally feel about something,” Dimon told Congress Thursday…. He suggested that the asset class could benefit from a more rigid regulatory framework. Although Dimon criticized regulators for being “a day late and a dollar short,” he speculated that the government will “pay a lot more attention” in the future.

Massive bitcoin mine discovered in UK after police raid suspected cannabis farm [CNBC]
The mine — located in an industrial unit on the outskirts of the English city of Birmingham — was stealing thousands of pounds worth of electricity from the mains supply…. Many people were visiting the unit at various points of the day, police said, adding there were numerous wiring and ventilation ducts visible. A police drone also detected a lot of heat coming from the building.
These are all “classic signs” of a cannabis farm, police said. However, officers found a bank of around 100 computers and zero cannabis on entering the building.

Related

robinhood

Opening Bell: 6.2.21

Murdick’s meme moment; whistleblower bailout; Robinhood grows up; and more!

new york snow

Opening Bell: 12.17.20

At last an IPO no one wants; another SPAC deal; bitcoin surges; Clayton continues tidying up; and more!

Opening Bell: 03.06.13

EU Fines Microsoft $732 Million (WSJ) The European Commission said it was imposing the fine after the U.S. software giant became the first company to break a voluntary agreement with regulators, which would have allowed at least 15 million consumers to pick alternatives to its Internet Explorer browser. The penalty is the latest episode in over a decade of wranglings between the EU and Microsoft, which has already seen the commission fine Microsoft €1.6 billion for failing to provide rivals with information at fair prices and for tying its media player to its operating system. Fed Holds Ground On Stress Tests (WSJ) The first component of the release, data on how banks will fare in an economic downturn, is slated for after U.S. stock markets close on Thursday. The second part, the Fed's response to buyback-and-dividend requests, is scheduled for publication a week later. Some executives warn that the delay could boost volatility in bank shares, as traders speculate on what the first round of results might mean for bank capital plans. Others warn of shareholder lawsuits if banks fail to disclose any information they receive, even informally, from regulators on the capital plans. Stress Tests Seen Boosting U.S. Bank Shareholder Payouts (Bloomberg) The six largest U.S. banks may return almost $41 billion to investors in the next 12 months, the most since 2007, as regulators conclude firms have amassed enough capital to withstand another economic shock. Lenders including Citigroup and Bank of America will buy back $26.4 billion in shares, up from $23.8 billion, according to the average estimate of three Wall Street analysts. An additional $14.5 billion will be paid out in dividends, $3.4 billion more than 2012, separate estimates show. The payouts are contingent on approval by the Federal Reserve. Forbes Hits Back at Saudi Prince Over Rich List (CNBC) A spat between Saudi billionaire Alwaleed Bin Talal and Forbes over the exact fortune of the prince has taken another bizarre twist. After the prince announced a severing of ties due to what he argued were flawed valuation methods, Forbes has now responded with an in-depth investigation, hitting back by describing his estimates as an "alternate reality". Forbes went on to say that the valuation of Kingdom Holding, the publicly traded company of Prince Alwaleed, gyrated for reasons "that, coincidentally, seem more tied to the Forbes billionaires list than fundamentals". In the lengthy piece published on Wednesday, the magazine also details its relationship with Prince Alwaleed since it began in 1988, recounting what it classified as "intermittent lobbying, cajoling and threatening" to influence his net worth listing over the years. AIG to Start Loan Investment Unit as Housing Rebounds (Bloomberg) AIG plans to buy loans backed by its United Guaranty Corp. unit, the largest seller of traditional private mortgage insurance last year, according to Donna DeMaio, 54, the unit’s chief executive officer. The debt will be held as long-term investments by AIG insurance companies. “You’re cutting the middle man out of the securitization process,” DeMaio said, referring to bonds that package home loans. The yield on an individual mortgage “is better than if you just bought the paper backed by the whole loan.” Two Hedgies Top The Field (NYP) Stephen Mandel and David Tepper earned more money for clients than any other hedge-fund manager in 2012, LCH Investments said. Mandel’s Lone Pine Capital made about $4.6 billion; Tepper’s Appaloosa Management made $3.3 billion. Traders Flee Asia Hedge Funds as Job Haven Turns Dead End (Bloomberg) Asian hedge-fund assets are 28 percent below their 2007 peak, according to data provider Eurekahedge Pte. Globally, money overseen by the funds increased 21 percent since 2007 to a new high of $2.3 trillion as of December, data from Chicago- based Hedge Fund Research Inc. show. A total of 296 Asian hedge funds liquidated in the two years to December, 33 more than the number that started. On a global basis, 1,839 new funds outnumber those that shut by 371, according to Eurekahedge. Ikea recalls cakes in 23 countries after sewage bacteria found (Telegraph) The furniture giant admitted on Tuesday that coliform bacteria had been found in two batches of almond cake from a supplier in Sweden. It comes after Chinese customs officials announced that they had destroyed a batch of 1,800 cakes after finding it contained high levels of coliforms which failed to meet hygiene standards. Coliforms, common bacteria which are found in faeces as well as soil and water, do not normally cause serious illness but are a sign of contamination which can indicate the presence of more harmful bacteria such as E.coli. It comes after Ikea recalled meatballs and sausages from 24 countries due to fears they could have been contaminated with horse meat. Oil Trader Ex-Wife Shouldn't Get Offshore Assets: Lawyers (Bloomberg) An oil trader’s ex-wife shouldn’t have any claim to properties held by offshore companies in which he invested as part of a 17.5 million-pound ($26.4 million) divorce settlement, lawyers said at a hearing in the U.K.’s highest court. The three Isle of Man-based companies, including Petrodel Resources Ltd., are “not relevant as a party to the litigation,” Tim Amos, the lawyer representing the companies, said today. The firms have asked the seven-judge panel of Britain’s Supreme Court to dismiss the wife’s claim. Yasmin Prest appealed an earlier ruling that denied her access to properties held and controlled by her ex-husband to cover part of the 2011 divorce settlement, which Michael Prest hasn’t paid, according to court documents at the U.K. top court. Her ex-husband isn’t a party to the litigation. ADP Says Companies in U.S. Added 198,000 Workers in February (Bloomberg) The 198,000 increase in employment followed a revised 215,000 gain the prior month that was more than initially estimated, figures from the Roseland, New Jersey-based ADP Research Institute showed today. The median forecast of 41 economists surveyed by Bloomberg called for an advance of 170,000. Madoff Trustee ‘Unlikely’ to Win Merkin Suit, N.Y. Says (Bloomberg) The judge shouldn’t allow trustee Irving Picard to block the deal because “in the unlikely event” that Picard can win part of his suit, Merkin’s funds would be able to pay him, Schneiderman said in a filing with U.S. District Judge Jed Rakoff yesterday. The attorney general made his filing saying Picard’s “unusual” request for an injunction -- to give him time to proof his own $500 million case -- required an additional response. Zoo shuts in panic as male and female escape from cage because cleaner forgot to lock the door (DM) A zoo in China was forced to close after two lions escaped from their unlocked cages. Riot police, snipers and zoo workers armed with tranquiliser guns worked to capture the ferocious animals after theyescaped at the zoo in Chongqing, south west China. According to reports, the lion and lioness were given free run of the zoo when a keeper who was cleaning their enclosure forgot to lock the gate. The zoo was completely evacuated following the escape at 8am. While the lionness was caught within the hour, the male was at large for almost four hours before he was recaptured. A zoo spokesman said: 'We found the female first and subdued her with a tranquiliser gun but the male took longer to find and bring back. 'They both recovered quickly and are no worse off for their adventure.' Officials have issued an apology to visitors for the panic caused. One said: 'You can't blame the lions. It was human error and they naturally took advantage of it.'

Opening Bell: 2.10.15

HSBC whistleblower warns there's more to come; Investors warns "peasants" will be coming with "pitchforks"; Oil trader warns crude prices could keep sinking; "Zoo stages escape drill with keeper dressed as leopard"; AND MORE.

By World Economic Forum (Flickr: The Global Financial Context: James Dimon) [CC BY-SA 2.0], via Wikimedia Commons

Opening Bell: 5.21.21

Paging Dr. Dimon; the European Robinhood isn’t Robin Hood; Mormons love meme stocks; and more!

gensler

Opening Bell: 2.16.21

Bitcoin boom; what if things get worse?; you know, like they are for Crispin Odey; Gensler gains; and more!

Opening Bell: 12.28.12

Blackstone seen sticking with SAC despite insider trading probe (Reuters / Matthew Goldstein) Three sources said the asset management arm of Blackstone, which has $550 million invested with SAC Capital, is in no rush to redeem money from the Stamford, Connecticut-based hedge fund. Blackstone has had at least three discussions with the $14 billion hedge fund's executives about the insider trading investigation and talked to its own investors, which include state pension funds, endowments and wealthy individuals. Hitler parody leaves French bank BNP red-faced (IN24) French banking giant BNP was left red-faced this week after it emerged managers were shown a motivational video featuring a parody of a famous scene from the film "Downfall" in which Adolf Hitler is portrayed as the boss of Germany's Deutsche Bank. It’s a scene that has been parodied thousands of times before to comic effect. But it appears not many people have seen the funny side of one particular version made by executives of French bank BNP Paribas...In the video, which was shown to around 100 managers from around the world at a seminar in Amsterdam last year, Hitler is turned into a fuming boss of Germany’s Deutsche Bank reacting furiously to news that BNP has gained an edge in the foreign exchange market. But far from being motivated, many of the managers who saw the video were outraged. “We could not believe the bank had actually dared to do that – make an analogy between our competitors and the Nazi regime. It took us a few minutes to take it in,” one BNP employee told French daily Liberation, who revealed the story this week. “We were shocked. Nobody knew how to react. Some Jewish employees from the United States did not find it funny at all,” another employee told the paper. “If this video had been shown by an American bank it would have been a major scandal,” an angry BNP source added. Rather surprisingly the video is believed to have been uploaded to the bank’s internal Intranet site before the management realised it might prove embarrassing and quickly removed it. A spokeswoman for BNP told FRANCE 24 on Friday that the bank’s senior management were totally unaware the video had been made until they were contacted by Libération this week. The spokeswoman said BNP’s CEO Jean Laurent Bonnafé had called his counterpart at Deutsche Bank Jürgen Fitschen to personally apologise for the stunt. In a statement in Libération the bank added that the message in the video was “contrary to the values of BNP." Obama Summons Congress Leaders as Budget Deadline Nears (Bloomberg) Obama, who had been negotiating one-on-one with House Speaker John Boehner, will meet today with Republicans Boehner and Senate Minority Leader Mitch McConnell, and Senate Majority Leader Harry Reid and House Minority Leader Nancy Pelosi, both Democrats. Cliff Talks Down To The Wire (WSJ) It is still possible the two sides can reach a deal, especially with the leaders meeting Friday. Any resolution would be a scaled-back version of the package Mr. Obama and congressional leaders had anticipated passing after the November election. The White House is pressing for the Senate to extend current tax rates for income up to $250,000, extend unemployment benefits, keep the alternative minimum tax from hitting millions of additional taxpayers and delay spending cuts set to take effect in January. The 11th-hour strategy carries enormous risk because it leaves no margin for error in Congress's balky legislative machinery. Senate Majority Leader Harry Reid (D., Nev.) said the prospects for passage of a bill before the last day of the year are fading rapidly. "I have to be very honest," he said. "I don't know time-wise how it can happen now." Spain's PM does not rule out asking for European aid (Reuters) Spanish Prime Minister Mariano Rajoy said on Friday he did not rule out tapping the European Central Bank's bond-buying program for troubled euro zone governments but said Spain did not expect to have to ask for aid for now. "We are not thinking of asking the European Central Bank to intervene and buy bonds in the secondary market," he said at a news conference in Madrid. "But we can't rule it out in the future." Banks pay $4.5M for muni charges (NYP) Citigroup and Bank of America’s Merrill Lynch are among five firms that will pay $4.48 million to settle regulatory claims they used funds from municipal and state bond deals to pay lobbyists. Local authorities were unfairly asked to reimburse payments that the firms made over five years to the California Public Securities Association, a lobbying group, to help influence the state, the Financial Industry Regulatory Authority, which oversees securities firms, said yesterday. The firms inadequately described the fees, wrapping them into bond-underwriting expenses, Finra said...The banks, also including Goldman Sachs, JPMorgan and Morgan Stanley, agreed to pay $3.35 million in fines and reimburse certain California bond issuers $1.13 million. Porsche Wins Dismissal of US Hedge Fund Lawsuit Over VW (Reuters) A five-justice panel of the New York State appeals court in Manhattan unanimously found that Porsche had met its "heavy burden" to establish that the state was the wrong place in which to bring the lawsuit. That panel reversed an Aug. 6 ruling by New York State Supreme Court Justice Charles Ramos that let the case by hedge funds including Glenhill Capital LP, David Einhorn's Greenlight Capital LP and Chase Coleman's Tiger Global LP proceed. The funds accused Porsche of engineering a "massive short squeeze" in October 2008 by quietly buying nearly all freely traded ordinary VW shares in a bid to take over the company, despite publicly stating it had no plans to take a 75 percent stake. IPOs Slump To Lowest Levels Since Financial Crisis (Bloomberg) IPOs have raised $112 billion worldwide this year, the least since 2008, according to data compiled by Bloomberg. Initial sales in western Europe dropped to one-third of last year’s level, while concern about China’s economy helped cut proceeds in Asia by almost half. U.S. offerings raised $41 billion, little changed from last year, as Facebook’s IPO spurred a monthlong drought in U.S. deals. Avery Johnson Jr. vents on Twitter after dad, Avery Johnson, is fired by Brooklyn Nets (NYDN, RELATED) The ex-Nets coach’s teenage son took to Twitter to vent after news broke that his dad had been given a pink slip by billionaire Mikhail Prokhorov and the Nets. “This is a f------ Outrage. My dad is a great coach, he just got coach of the month and they Fire him. #Smh. Completely new team he had,” Johnson Jr. wrote on Twitter. “The expectations were way to high for this team. We didn’t even have a losing record.... Didn’t even give my dad a full season. #OUTRAGE,” Johnson Jr. continued. Johnson was fired a day after the new-look Nets fell to .500 following a listless road loss to the Bucks. The canning comes on the heels of Deron Williams saying he’s never been comfortable playing in Johnson’s offense. Williams, who did not play in Wednesday night’s loss, is mired in a season-long shooting slump with field goal and 3-point percentages at career-worst levels. “I’m sorry (our) best players couldn’t make open shots. Yeah that’s my dad’s fault totally,” Johnson Jr. tweeted. 'Whale' Capsized Banks' Rule Effort (WSJ) Wall Street banks entered 2012 confident they could stall a wave of rules that they feared would hurt profits. But they are ending the year largely resigned that their activities will be constrained and monitored more closely by the government. One big reason for the change: J.P. Morgan Chase JPM -0.76% & Co.'s "London whale" losses. The bad trades, ultimately resulting in about $6 billion in losses, disrupted the banks' campaign against the Dodd-Frank financial overhaul, according to regulators, lawmakers and close observers of policy debates in Washington. The trades damaged the reputation of J.P. Morgan, which suffered less than other banks from the financial crisis, and its chief executive, James Dimon, during a crucial period of policy debate in Washington, putting critics of Dodd-Frank on the defensive. Before news of the whale losses emerged, banks were arguing, with some success, that too-tight regulations were crimping lending during a time of slow growth. Michael Greenberger, a finance professor at the University of Maryland and an advocate of regulations aimed at reining in bank trading, said that in early 2012 his allies' "backs were against the wall." "Then the London whale blew all of that out of the water," he said. Mortgages Fueled Hedge Funds To 13.9 Percent Gain (NYP) Hedge funds that invest in mortgage-backed securities gained 13.9 percent through November to make them the industry’s best-performing strategy, according to the Absolute Return index. Top players that did even better included Metacapital Management, Pine River, Axonic Capital, and Greg Lippman's LibreMax Capital. High-Speed Traders Race to Fend Off Regulators (WSJ) Defenders say high-frequency trading keeps markets lubricated with a constant supply of buy and sell orders that enables all participants to trade more efficiently and get better pricing. High-speed traders, supporters add, have helped foster competition among exchanges and other trading venues, lowering commission-based fees for small investors and helping bring down overall costs for mutual-fund managers. Another benefit some cite: Technology innovations spurred by high-speed traders serve to connect more investors to more trading venues, broadening their options in the markets. Critics, for their part, worry that the traders' order torrent makes markets more opaque, less stable and ultimately less fair. Will 'Fiscal Clif' Accelerate Millionaire Deaths? (NetNet) John Carney: "...it at least seems likely that some deaths that might otherwise have occurred shortly after January 1 will occur shortly before." Man gets DUI after driving on AA co-founder's lawn (AP) Vermont State Police say a man faces a drunken driving charge after driving onto the lawn of a historic home once owned by the co-founder of Alcoholics Anonymous. Police say 55-year-old Donald Blood III of Marlborough, Mass., was ordered to appear in court in Bennington on Jan. 14. Police say Blood thought he was driving into a parking lot, but actually it was the lawn of the Wilson House, built in 1852 in Dorset, the birthplace of AA co-founder Bill Wilson. The Wilson House's website describes it as a "place of sanctuary where people can come to give thanks to God for their new lives." It still hosts several AA meetings each week. Programming Note< : We’re on an abbreviated, vacation-esque schedule this week (opening news roundups and limited updates whenever the urge to reach out and touch you moves us). We still want to hear from you, though, so if anything happens that you think might tickle our fancy, do not hesitate to let us know.

vertical aerospace

Opening Bell: 6.11.21

Sky cab SPAC; foreigners boost T-bills; bitcoin evangelists spread something else; and more!