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• Obama's Counsel Was Told of IRS Audit Findings Weeks Ago (WSJ)
• North Korea fires sixth missile in three days (Reuters)
• Enron No Lesson to Traders as EU Probes Oil-Price Manipulation (BBG)
• Don't cry for me, Eurozone: Thinking the Unthinkable - Quitting a Currency (WSJ)
• H-1B Models Strut Into U.S. as Programmers Pray for Help (BBG)
• Gold Bear Bets Reach Record as Soros Cuts Holdings (BBG)
• Yahoo has agreed to pay $1.1 billion for Tumblr (WSJ)
• JPMorgan Holders Led by Chairmen-CEOs to Vote on Dimon (BBG)
• Apple faces grilling over US tax rate (FT)
• Nissan to Sell First Joint Minicar to Expand in Japan Market (BBG)
• Fierce battle for corporate loans sparks US bank risk concerns (FT)
• Microsoft Updates Xbox as Apple to Facebook Gain in Games (BBG)

Why There Is So Much Pro-War Reporting

Mitt Romney's net worth of $250 million is well-known by virtually everyone in America: after all, it was the primary campaign offensive used by the Obama team against his presidential challenger in an election run largely down wealth, and social class lines, and whom "Democrats targeted in ads and speeches as being out of touch with most Americans." What many may not know is that staunch democrat Al Gore's own personal wealth, has soared from virtually nothing in 1999 to a staggering $200 million according to an analysis conducted by Bloomberg.

• UK economy shows 0.3% growth (FT)
• Texas University Fund Sold $375 Million in Gold Bars (BBG)
• Spain Jobless Rate Breaches 27% on Recession Woes (BBG)
• Letta calls for easing of austerity policies (FT)
• Italy Led by Letta Brings Berlusconi Back as Winner (BBG)
• Fed Debate Moves From Tapering to Extending Bond Buying (BBG)
• South Korea wants talks with North on shuttered industrial zone (Reuters)
• Republicans advance bill to prepare for debt ceiling fight (Reuters)
• Republicans claim White House failed to warn on severity of cuts (FT)
• Xi meets former US heavyweights (China Daily)
• Next BoE chief Carney says clear framework key to policy success (Reuters)
• Chinese roll out red carpet for Hollande (FT)

It is clear now that we must have been wrong about the economy. No more proof is needed than the fact the Dow has gone up 1,500 points. Everyone knows the stock market reflects the true health of the nation – multi-millionaire Jim Cramer and his millionaire CNBC talking head cohorts tell us so. Ignore the fact that the bottom 80% only own 5% of the financial assets in this country and are not benefitted by the stock market in any way. It is time to open your eyes and arise from your stupor. Observe what is happening around you. Look closely. Does the storyline match what you see in your ever day reality? It is them versus us. Whether you call them the invisible government, ruling class, financial overlords, oligarchs, the powers that be, ruling elite, or owners; there are powerful wealthy men who call the shots in this global criminal enterprise. No amount of propaganda can cover up the physical, economic, social, and psychological descent afflicting our world. There’s a bad moon rising and trouble is on the way.

• French unemployment rises again to highest since 1999 (Reuters)
• BoJ rejects call for monetary easing (FT)
• North Korea threatens pre-emptive nuclear strike against US (Guardian)
• Firms Race to Raise Cash (WSJ)
• Time Warner Will Split From Magazine Unit in Third Spinoff (BBG) - slideshows, kittens, "all you need to knows" coming to Time
• U.S. economy, world's engine, remains in "neutral": Fed's Fisher (Reuters)
• BOE Keeps QE on Hold as Officials Weigh More Radical Measures (BBG)
• Jobs start to go as US sequestration cuts in (FT)
• BofA Times an Options Trade Well  (WSJ)
• Congress Budget Cuts Damage U.S. Economy Without Aiding Outlook (BBG)
• Dell’s Crafted LBO Pitch Gets Messy as Investors Circle (BBG)
• Dell says Icahn opposes go-private deal (Reuters)
• Portugal Rating Outlook Raised to Stable by S&P on Budget Plan (BBG)
• China’s Richer-Than-Romney Lawmakers Reveal Reform Challenge (BBG)

It looks like the Dow Jones Industrial Average will be the first major U.S. equity benchmark to breach new highs, so ConvergEx's Nick Colas breaks down this closely watched measure of domestic stock prices noting that the Dow is a quirky “Index” – price weighted (not market capitalization), compact (30 names) and fundamentally global (lots of brand-name multinationals).  Change just one name in the index, and the outcomes vary considerably.  If Google had been added at the end of last year, we’d be at 14,330 – well over the old high of 14,165.  But if the Dow committee had added Apple instead, the index would have closed at 13,475 yesterday, up less than 3% on the year.  And if Netflix had been the lucky company added for 2013, well…  We’d be saying hello to Dow 15,000, and then some. The point here is that the notion of a “New High” for the Dow is a little arbitrary, by virtue of the price weighting function and stock selection process.

• John Kerry just got happier: Berkshire Hathaway, 3G Buying Heinz for $72.50 a Share, or $28 Billion - ~20% premium to last price (CNBC)
• US Airways, AMR to Merge (WSJ) - can thousands of workers spell "synergies"?
• Draghi, Carney show ascent of "whatever it takes" central bankers (BBG) ... to preserve the Goldman way of life
• Euro zone economy falls deeper than expected into recession (Reuters)
• Soros has made $1 billion betting against the Japanese Yen (WSJ)
• Ex-Analyst at SAC Felt Pressured for Tips  (WSJ)
• Desalination Seen Booming at 15% a Year as World Water Dries Up (BBG)
• China's 'Wall' Hits Business (WSJ)
• Israel publishes some details as Australian spy mystery deepens (Reuters)
• Tata Motors Profit Falls 52% (WSJ)
• AB InBev Will Sell Corona Unit to Salvage Modelo Takeover (BBG)
• "Blade Runner" Pistorius charged with murdering girlfriend (Reuters)
• In Ohio and beyond, Obama sees model for manufacturing revival (Reuters)

• Bersani's lead over Berlusconi continues to erode, now just 3.6 Pts, or inside error margin, in Tecne Poll
• Spain gears up for U.S. debt investor meetings (Reuters)
• PBOC Set for Record Weekly Liquidity Injection (WSJ)
• RBS Trader Helped UBS’s Hayes With Libor Bribes, Regulators Say (BBG)
• ECB, Ireland reach bank debt deal (Reuters)
• AMR-US Airways Near Merger Agreement (WSJ)
• Monte Paschi says no more derivatives losses (Reuters) ... remember this
• Harvard’s Gopinath Helps France Beat Euro Straitjacket (BBG) - by sliding into recession?
• Obama Relents on Secret Drone Memo (WSJ)
• Brennan to face questions on interrogations, drones and leaks (Reuters)
• Wall Street Success With Germans Boomerangs (BBG)
• Khamenei rebuffs U.S. offer of direct talks (Reuters)
• Boeing Preps Redesign to Get 787 Flying  (WSJ)

• Risky Student Debt Is Starting to Sour (WSJ)
• Political scandal in Spain as PP secret accounts revealed (El Pais)
• New York Times claims Chinese hackers hijacked its systems (NYT)
• Spain's Rajoy, ruling party deny secret payment scheme (Reuters)
• Iran crude oil exports rise to highest since EU sanctions (Reuters)
• BlackBerry 10’s Debut Fizzles as U.S. Buyers Left Waiting (BBG)
• Costs drag Deutsche Bank to €2.2bn loss  (FT)
• And the gaming of RWA continues - Deutsche Bank Beats Capital Goal as Jain Shrugs Off Loss (BBG)
• More fun out of London - Barclays, RBS May Pay Billions Over Improper Derivatives Sales (BBG)
• Hagel to face grilling by Senate panel on Mideast, budget (Reuters)

• With array of challenges, Obama kicks off second term at public inauguration (Reuters)
• Uneasy in the Political Climate, Mickelson Talks Like Someone Ready to Step Away (NYT)
• BOJ Should Slow Easing If Yen Weakens Too Much, Hamada Says (BBG)
• Spain Recession Scars Exposed as Jobless Seen at 6 Mln (BBG)
• Davos Doom Loses to Merkel-Draghi as Euro Defies Roubini (BBG)
• Algeria finds dead Canadian militants as siege toll rises (Reuters)
• Beijing tries to clean up its act (FT)
• Investigators probe Boeing 787 battery maker (Reuters)
• Netanyahu Gets Landslide in Markets Masking No Peace Process (BBG)
• Google aims to replace passwords with ID ring (Telegraph)
• Kim Dotcom launches new upload site (FT)
• Dell Said to Hire Evercore to Seek Higher Bids After Buyout (BBG)
• Hostess Bakers Union Hires Investment Bank Gordian in Asset Sale (BBG)

• London Quantitative Hedge Funds Report Second Year of Losses (BBG)
• Berlusconi Forms Alliance in Comeback Bid (WSJ)
• Japan to Buy ESM Bonds Using FX Reserves to Help Weaken Yen (BBG)
• Japan Mulling BOJ Accord Linked to Employment, Mainichi Says (BBG)
• Samsung Expects Record Operating Profit (WSJ)
• Boeing 787 Dreamliner Fire Probed, Blaze Adds to Setbacks (BBG)
• BOJ's Shirai: Open to Firmer Inflation Target (WSJ)
• HSBC N.J. Client Admits Conspiracy in Offshore Tax Case (BBG)
• Lampert to Assume CEO Role at Sears (WSJ)
• Abe prepares fresh stimulus measures (FT)
• U.S. Set for Biggest State-Local Jobs Boost Since 2007 (BBG)
• Pakistan Seen Needing IMF Bailout as Rupee Drops Before Vote (BBG)

• Senate-Passed Deal Means Higher Tax on 77% of Households (BBG)
• Bipartisan House Backs Tax Deal Vote as Next Fight Looms (BBG)
• Fresh stand-off looms after US cliff deal (FT)
• Congress Deal Averting Tax Increase Curbs Risk to States (BBG)
• How Colombian drug traffickers used HSBC to launder money (Reuters)
• Danes Face New Reality in Struggle to End Crisis, PM Says (BBG)
• Ban on demanding Facebook passwords among new 2013 state laws (Reuters)
• Oil Climbs to Three-Month High as U.S. House Passes Budget Bill (BBG)
• Cameron seeks bold steps from G8 leaders (FT)
• China to outstrip Europe car production (FT)
• North Korea Picks Stronger Economy, South Ties as Top 2013 Tasks (BBG)

• Republicans put squeeze on Obama in "fiscal cliff" talks (Reuters)
• Inquiry harshly criticizes State Department over Benghazi attack (Reuters)
• Banks See Biggest Returns Since ’03 as Employees Suffer (BBG)
• Italy president urges election be held on time (Reuters)
• Bank of England Says Sterling Hurting Economy (WSJ) - there's an app for that, it's called a Goldman BOE chairman
• China slowdown hits Indonesian farmers (FT)
• China dispute hits Japanese exports (FT)
• Market to get even more monopolized by the HFT king: Getco wins Knight with $2 bln sweetened offer (Reuters)
• MF Global Cases Focus on 'Letters' (WSJ)
• UBS fined $1.5 billion in growing Libor scandal (Reuters)
• Spotlight swings to interdealer brokers (FT)
• China Widens Access to Capital Markets (WSJ)
• With Instagram, Facebook Spars With Twitter (WSJ)

Sluggish global economic growth means many public companies will have to rely on mergers and acquisitions to generate earnings growth in 2013 and beyond (FCX aside that is).  ConvergEx's Nick Colas notes that the academic discussion of whether such a strategy adds “Real” value to shareholders has shifted in recent years.  From an unequivocal “No, never…” to a more qualified, “It really depends,” this discussion will grow more critical as industries from financial services to manufacturing to commodity producers evaluate their long term prospects.  The key to this question, at least to Colas' thinking, is in the analysis of barriers to entry/exit and true economies of scale.  The right answer to the “Does M&A add value” question is much more about business strategy and competitive analysis than any blanket statement about the merits of buying or selling assets. In summary, M&A is now simply much more important to corporate strategy than at any point in the last 30 years; over the next 5-10 years M&A activity will be increasingly necessary to keep the tailwind of growth in almost every sector of the economy and capital markets. There’s just no other way to grow (though shareholders increasingly want that 'cash' in dividends or buybacks - and not growth!)