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Nov 9, 2015

DealBook P.M. Edition - November 9, 2015: Top story: Canadia pacific Said to Weigh Deal for Nordic Southern

  
 
Monday, November 9, 2015
TOP STORY
 
TOP STORY
An Eastbound Norfolk Southern intermodal freight train passes through Waddy, Kentucky.
Canadian Pacific Said to Weigh Deal for Norfolk Southern The preliminary discussions may lead to a new round of consolidation within the railroad industry.

DEALBOOK HIGHLIGHTS
Pimco Calls William Gross Lawsuit 'Legally Groundless' Pimco said the suit "is only the latest step in Mr. Gross's effort to resurrect a personal reputation damaged by his own unacceptable behavior."
Rich Wong, left, a partner with the venture capital firm Accel, and Jay Simmons, president of the Australian software maker Atlassian.
Software Maker Atlassian Files to Go Public The company, whose last private investment round valued it at more than $3 billion, makes products meant to make life easier for software developers.

SEC Litigation Release - November 9, 2015: James M. Louks and FiberPoP Solutions, Inc.

SEC Seal

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 23402 / November 9, 2015

Securities and Exchange Commission v. James M. Louks and FiberPoP Solutions, Inc., Civil Action No. 15-cv-3456 (D. Minn., Complaint filed Sept. 1, 2015)

Court Enters Partial Judgment Against James M. Louks and Fiberpop Solutions, Inc.

The Securities and Exchange Commission announced today that on November 4, 2015, the Honorable Patrick J. Schiltz of the United States District Court for the District of Minnesota entered a partial judgment against defendants James M. Louks and FiberPoP Solutions, Inc. ("FiberPoP").
The partial judgment against Louks and FiberPoP imposes a permanent injunction against future violations of certain antifraud provisions of the federal securities laws. The injunction also prohibits Louks and FiberPoP from raising money from investors. Louks and FiberPoP consented to the entry of partial judgment without admitting or denying the SEC's allegations. The partial judgment leaves the issue of the amount of disgorgement, prejudgment interest, and civil penalties to be imposed against Louks and FiberPoP to be decided at a later time.

CMI Spot Prices as Close of Trading in New York on November 9, 2015.



CMI Gold & Sliver


Spot Prices as of traditional New York closing times

Monday, November 09, 2015


Gold

Today Change Week Ago Month Ago Year Ago
$1,189.40 +$0.10 $1,137.40 $1,157.70 $1,159.25

Silver

Today Change Week Ago Month Ago Year Ago
$14.44 -$0.28 $15.44 $15.85 $15.69

Platinum

Today Change Week Ago Month Ago Year Ago
$915.90 -$26.20 $980.10 $979.30 $1,209.40

Palladium

Today Change Week Ago Month Ago Year Ago
$599.00 -$15.15 $653.45 $712.45 $767.60

Gold/Silver Ratio

82.37

Wall Street at Close Report by CMBC on November 9, 2015: Dow Jones Closes Over 150 Points Lower Weigs; Fed Eyed


cnbc.com

Dow closes over 150 points lower as IBM weighs; Fed eyed

Fred Imbert
 
U.S. equities closed lower Monday as investors weighed a possible Federal Reserve rate hike in December.
"Perhaps it's worries about the legitimacy of the Federal Reserve lifting interest rates and that equity valuations — which have been in full — need to be re-rated," said Mark Luschini, chief investment strategist at Janney Montgomery Scott.
The odds of the Fed raising rates for the first time in about a decade rose dramatically after the October nonfarm payrolls report — released Friday — showed the U.S. economy added 271,000 jobs.
According to the CME Group, the probability of a December rate hike rose from about 58 percent to about 70 percent.
Read More Top trader: Buy this regional bank on a Fed hike

U.S. stocks opened lower and soon proceeded to extend losses, with the Dow Jones industrial average falling as much as 242.55 points at its session lows before paring gains slightly ahead of the close.
"I think there was some bargain hunting this afternoon," said Kim Forrest, senior equity analyst at Fort Pitt Capital.
The blue chips index also fell back into negative territory for the year as IBM contributed most of the losses.

GATA | THE GATA DISPATCH - November 9, 2015: China to Allow Direct Conversion Between Yuan and Swiss franc

China to allow direct conversion between yuan and Swiss franc

Submitted by cpowell on Monday, November 9, 2015By Fion Li
Bloomberg News
Monday, November 9, 2015

China took another step to boost the yuan's global usage, saying it will start direct trading with the Swiss franc, as the nation pushes its case for reserve-currency status at the International Monetary Fund.
The link will start on Tuesday, the China Foreign Exchange Trade System said in a statement, making the franc the seventh major currency that can bypass a conversion into the U.S. dollar and be directly exchanged for yuan. The rate will be allowed to fluctuate a maximum 5 percent on either side of a daily fixing, according to CFETS. ...

... For the remainder of the report:
http://www.bloomberg.com/news/articles/2015-11-09/china-to-allow-direct-...

GATA | THE GATA DISPATCH - November 9, 2015: Reuters: European Central Bank May Push Interest rates More Negative.

Reuters: European Central Bank may push interest rates more negative

Submitted by cpowell on Monday, November 9, 2015. ECB Rate Setters Converge on December Deposit Rate Cut
By Paul Taylor and Balazs Koranyi
Reuters
Monday, November 9, 2015


A consensus is forming at the European Central Bank to take the interest rate it charges banks to park money deeper into negative territory in December, four governing council members said, a move that could weaken the euro and push up inflation.
Some argue that a deposit rate cut should even be larger than the 0.1 percent reduction currently expected in financial markets, the policymakers said.
They are keen to exhaust the conventional and more direct monetary policy tool as they also consider amending the 60-billion-euro asset purchase program, a far more contentious issue that they have yet to agree on. ...

... For the remainder of the report:
http://www.reuters.com/article/2015/11/09/us-ecb-policy-idUSKCN0SY1FI201...

European Markets at Close Report by CNBC on November 9, 2015. Europe Closes Lower on China Data; Earnings Eyed

cnbc.com

Europe closes lower on China data; earnings eyed

Holly Ellyatt, Arjun Kharpal, Alexandra Gibbs
European equities close lower Monday as weak Chinese trade data and individual stock performance weighed on investor sentiment.
The pan-European STOXX 600 closed lower by around 1.1 percent, with most European indexes and sectors in the red.






FTSE FTSE 100 Index 6298.35
-55.48 -0.87% 449978532
DAX DAX Index 10836.97
-151.06 -1.37% 54499500
CAC 40 CAC 40 Index 4912.76
-71.39 -1.43% 80478603
IBEX 35 IBEX 35 Idx 10346.60
-106.60 -1.02% 161120753
Data on Friday showed U.S. nonfarm payrolls increased 271,000 in October, the largest gain since last December. The U.S. unemployment rate fell to 5.0 percent, the lowest since April 2008. The data has increased the likelihood of a rate hike in December. Consequently, U.S. equities opened Monday trading lower as investors weighed a possible rate hike in December.

In Asia, stocks diverged on Monday, with markets in China and Japan leaping to their highest levels since late August, while other regional bourses wobbled after China released below-view trade figures over the weekend.

FTC Business Blog - November 9, 2015: The Role of the Bureau of Economics in Consumer Protection: A Conversation with Bureau Directors

Bureau of Consumer Protection Business Center Blog Updates from the Federal Trade Commission

By Jessica Rich and Francine Lafontaine
 
Most practitioners are familiar with the work of the FTC’s two primary law enforcement bureaus. The role of the third bureau – the Bureau of Economics – may be less familiar to readers of this blog, but it’s just as essential to the agency’s mission. How do the Bureau of Consumer Protection and the Bureau of Economics work together? We posed that question to BE Director Francine Lafontaine and BCP Director Jessica Rich.

Read more >

FDIC Weekly National Rates and Rate Caps Update - November 9, 2015.

FDIC

Weekly National Rates and Rate Caps


On May 29, 2009, the FDIC Board of Directors approved a final rule making certain revisions to the interest rate restrictions applicable to less than well capitalized institutions under Part 337.6 of the FDIC Rules and Regulations. The final rule redefined the "national rate" as a simple average of rates paid by U.S. depository institutions as calculated by the FDIC. The national rates and rate caps for various deposit maturities and sizes are provided below.
For more information. see Financial Institution Letter FIL-25-2009
Rates updated November 9, 2015

NYT First Draft on Politics - November 9, 2015: Rubio and Carson Enter the Debate on the Rise and Under Siege.

Monday, November 9, 2015

The New York Times

NYTimes.com/FirstDraft »

The New York Times

Monday, November 9, 2015

Senator Marco Rubio of Florida and Ben Carson at the first Republican presidential debate in Cleveland in August.
Senator Marco Rubio of Florida and Ben Carson at the first Republican presidential debate in Cleveland in August. Doug Mills/The New York Times
Rubio and Carson Enter the Debate on the Rise and Under Siege
By MAGGIE HABERMAN
Good Monday morning. President Obama will meet with Prime Minister Benjamin Netanyahu of Israel to see if they can change their recent narrative, which has been marked by slights and crossed signals. But the candidates are again turning their attention to debate preparation, as each party will gather this week to hash things out. First, the Republicans meet on Tuesday as two candidates in particular face the perils of success.
Ben Carson and Senator Marco Rubio of Florida spent the weekend fending off questions about their pasts, with both men dealing with the type of scrutiny that comes with a rising candidacy and which is sure to be a factor at the Republican presidential debate on Tuesday.
Mr. Carson, appearing for interviews by telephone on several Sunday news shows, denounced the coverage raising doubts about portions of his biographical tale: an up-by-the-bootstraps redemption that is the center of his candidacy. The major questions are whether he met with a military general as he claimed, whether he tried to stab a “close relative” and whether he was honored for honesty at Yale.
That narrative, of a man whose life was changed by discovering God, has helped bring evangelical voters to his side in Iowa. The questions need to end, Mr. Carson said, insisting that he had evidence to support his claims.

Bloomberg View - November 9, 2015: A Bad Way to Make Banks Safe

bloombergview.com

A Bad Way to Make Banks Safe

The Editors
 
Global regulators say they're making progress in reducing the threat that the world's largest banks can pose to the economy. Actually, new rules may be making things worse.
Regulators want to create a second layer of protection against financial disaster, beyond the equity that comprises banks' first line of defense against losses. It would consist of a special kind of long-term debt, issued by financial holding companies to investors willing and able to bear losses.
The idea is that if a big bank came to the edge of insolvency, regulators could convert the debt into equity, using it to shore up myriad subsidiaries around the world without using taxpayer money. In principle, this is fine. In practice, it may not be.
The Financial Stability Board, an international regulatory body, specified that systemically important banks must have a total loss absorbing capacity of at least 6.75 percent of assets (including "bail-in-able" debt and equity). On Oct. 30, the Federal Reserve proposed a higher minimum of 9.5 percent for U.S. banks -- 4.5 percent debt and 5 percent equity. Although the rules won't take effect for several years, Standard & Poor's said that it might cut some big U.S. banks' credit ratings this year, on the grounds that they will be less likely to receive taxpayer support.

DealBook Today's Top Headlines - November 9, 2015: Bonus Pay on Wall Street Likely to Fall | A Tough Year for Hedge Funds, but Not Real Estate | Square Persists with I.P.O..

 
Monday, November 9, 2015
TODAY'S TOP HEADLINES
y AMIE TSANG
BONUS PAY ON WALL STREET LIKELY TO FALL Bonuses in the financial industry this year are expected to fall 5 to 10 percent, Nathaniel Popper reports in DealBook. It will also be the first year since 2011 that compensation for the whole industry is expected to drop, according to a report by the compensation consulting firm Johnson Associates.

There are still some bright spots in private equity and mergers-and-acquisition work, but most of the industry is struggling. The report expects end-of-year compensation in investment and commercial banking to be down 30 percent from 2009 levels.

Business lines requiring less capital, often because they are considered less risky, are seeing better returns and bonuses. For bankers advising on mergers and acquisitions, incentive payments are expected to be 15 to 20 percent higher.

Asset management requires less capital but will experience a 5 percent drop in bonuses this year as the business struggles with tepid markets and economy. The sharpest decline is expected in fixed income, where bonuses are predicted to drop 10 to 20 percent this year.

U.S. Stock Market Future Indications by MarketWatch - November 9, 2015: Stocks Future Slip as Wall Street Waits for a Spur.

marketwatch.com

Stock futures slip as Wall Street waits for a spur

Barbara Kollmeyer
 
Wall Street stocks were pointing to moderate losses on Monday, as the U.S. dollar stayed firm in the wake of last week’s stronger-than-expected jobs data, which increased the odds of a Federal Reserve interest rate hike.
Dow Jones Industrial Average YMZ5, -0.28%  futures fell 58 points, or 0.3%, to 17,785, while S&P 500 futures ESZ5, -0.02%  dropped 7.45 points, or 0.3%, to 2,086.50. Nasdaq-100 index NQZ5, +0.17%  futures fell 13.50 points, or 0.3%, to 4,689.50.
Another gain for stocks last week helped the Dow industrials DJIA, +0.26%  and S&P 500 SPX, -0.03%  log their longest weekly winning streak since late 2014. While up 1% for the week, the S&P 500 finished Friday’s session with a slight loss and just under the key technical support level of 2,100.

Asian Markets at Close Report by MarketWatch on November 9, 2015: Stocks in China, Japan Hit Hohest Levels in 2 1/2 Months.

marketwatch.com

Stocks in China, Japan hit highest levels in 2 1/2 months

Chao Deng
 
Shares in Japan and Shanghai rallied to fresh 2 1/2 -month highs, lifted by a weaker yen and stimulus hopes, respectively, while worries about China’s slowdown drove most other Asian markets lower.
Japan’s Nikkei Stock Average NIK, +1.96%  finished up 2% at 19,642.74, its highest close since late August.
The Shanghai Composite Index SHCOMP, +1.58%  was up 1.6% to 3,648.42. That adds to a 6% jump the previous week. Hong Kong’s Hang Seng Index HSI, -0.61%  was down 0.1%.
Australia’s S&P/ASX 200 XJO, -1.83%  was down 1.8%, while South Korea’s Kospi SEU, -0.75%  lost 0.8%.
Over the weekend, data showed Chinese exports in October fell for the fourth consecutive month, by 6.9% year-over-year in dollar terms, after a drop of 3.7% in September. The October figure was worse than the median 4.1% decline forecast in a Wall Street Journal poll.
In China, investors are also assessing the impact of regulators’ announcement late Friday plans to lift a ban on initial public offerings, after suspending them in July in the heat of a share selloff.
Historic meeting between leaders of China and Taiwan
China’s Xi Jinping and Taiwan’s Ma Ying-jeou met in Singapore Saturday, marking the first meeting for the leaders of the two sides since their governments split in 1949.
China’s stock regulator has adjusted the timing of public offerings in the past — depending on how the market is trading — introducing new listings when it believes investor appetite is healthy enough. Since 1990, the market has declined five times and risen four during periods when regulators allowed companies to list, according to a morning note by Bank of Communications Ltd.
“From the perspective of regulators, they think the rally will continue, which is why they will resume IPOs,” said Louis Lu, fund manager at CSOP Asset Management. Last week, the Shanghai Composite Index entered bull market territory — defined as a rise of 20% from a recent low. Analysts says its cross above 3500 could inspire more local investors to buy shares again.
Lu said the Chinese exports data could pressure authorities to step up stimulus, which would boost markets later Monday.
“Our view is the Chinese market will rally until December before the Federal Reserve [raises] rates,” he said.
A strong October jobs report in the U.S. on Friday firmed expectations that the Federal Reserve could raise interest rates as soon as next month. Patchy data from previous weeks had led some to believe that time frame could be pushed to next year.
On Saturday, China’s central bank reported that foreign-exchange reserves in October rose by $11.39 billion to $3.526 trillion, ending a five-month streak of monthly declines. Economists said it signaled weaker expectations among investors that the yuan would depreciate further and signal that officials’ efforts to stem illegal outflows have met some success.

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