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Frontrunning: January 7

Tyler Durden's picture





 
  • Secret and Lies of the Bailout (Rolling Stone)
  • Banks Win 4-Year Delay as Basel Liquidity Rule Loosened (BBG)
  • Hedge Funds Squeezed With Shorts Beating S&P 500 (BBG)
  • Bankruptcy regime for nations urged (FT)
  • Is the Fed Doing Enough—or Too Much—to Aid Recovery (WSJ)
  • Cracks widen in US debt ceiling debate (FT)
  • McConnell Takes Taxes Off the Table in Debt Limit Negotiations (BBG)
  • Abe Seen Spending 12 Trillion Yen to Boost Japan’s Economy (BBG)
  • Monti, Berlusconi Spar on Taxes in Weekend Media Barrage (BBG)
  • Cameron Sets New Priorities for U.K. Coalition (BBG)
  • Defiant Assad Rules Out Talks With Rebels (WSJ)
  • Korea Seen Resisting Rate Cut as Won Threatens Exports (BBG)

 

Overnight Media Recap

WSJ

* Republicans won't accept further tax increases in the United States in coming budget and debt negotiations, the party's Senate leader said on Sunday, putting Republican lawmakers on a collision course with Democrats over raising the government's borrowing limit.

* Global banking regulators watered down a key element of their plan for creating a safer financial system, giving ground to banks that argued the rules were unworkable and financially risky.

* Banks were closing in on a $10 billion foreclosure-abuse settlement with U.S. regulators that could be announced as soon as on Monday, according to people familiar with the talks.

* ExxonMobil Corp said it will spend $14 billion to develop the Hebron oil field off the shore of eastern Canadian province Newfoundland and Labrador, a project it expects to yield 700 million barrels of oil.

* Syrian President Bashar al-Assad issued a defiant call to war to defend the country against what he called a foreign-inspired rebellion, ruling out talks with rebels and rejecting international peace efforts for a political plan of his own that keeps him in power.

* Flowers Foods and Grupo Bimbo are in discussions to acquire pieces of Hostess Brands Inc's bread business, as the maker of Wonder Bread and Twinkies sells off assets and liquidates, said people familiar with the talks.

* Oprah Winfrey's OWN Network unveiled six new original series on Saturday aimed at bolstering the fledgling network's audiences.

 

FT

Headlines 'MASSIVE SOFTENING' OF BASEL BANK RULES

SONY REJOINS BMG FOR PARLOPHONE BID

TERRA FIRMA EYES BIG PICTURE IN PLANS TO SELL ODEON CHAINMORRISON LOSES MANAGER BEFORE SALES UPDATE

AXA SEEKS 1 BLN STG FOR LONG-LEASE UK FUND

COMPANIES PAY HEED TO INVESTOR PROTESTS OVER EXECUTIVE SALARIES

Overview 'MASSIVE SOFTENING' OF BASEL BANK RULES Regulators have announced that the first-ever global liquidity standards will be less tough than expected and will not be fully enforced until 2019, four years later than expected.

SONY REJOINS BMG FOR PARLOPHONE BID BMG, a joint venture between Bertelsmann and KKR , has teamed up with Sony to bid for Parlophone from Vivendi's Universal Music Group.

TERRA FIRMA EYES BIG PICTURE IN PLANS TO SELL ODEON CHAIN Private equity group Terra Firma is looking to sell assets this year that may include European cinema chain Odeon & UCI Group.

MORRISON LOSES MANAGER BEFORE SALES UPDATE Wm Morrison's company secretary Greg McMahon is leaving the supermarket chain, people familiar with the situation said, marking the sixth senior management change at the company over the past year.

AXA SEEKS 1 BLN STG FOR LONG-LEASE UK FUND AXA Real Estate, the property arm of the French insurer, is raising 1 billion pounds ($1.6 billion) from investors to buy buildings in the UK with long leases.

COMPANIES PAY HEED TO INVESTOR PROTESTS OVER EXECUTIVE SALARIES Britain's biggest firms are set to rein back executive pay as shareholders ramp up their campaign to keep pay and bonuses under control.

 

NYT

* A $10 billion settlement with U.S. regulators to resolve claims of foreclosure abuses by 14 major lenders is expected to be announced as early as Monday, several people with knowledge of the discussions said on Sunday.

* A group of top regulators and central bankers on Sunday gave banks around the world more time to meet new rules aimed at preventing financial crises, saying they wanted to avoid the possibility of damaging the economic recovery.

* Two pension funds that agreed to a relatively small settlement with the directors of Bank of America over its acquisition of Merrill Lynch are being ordered by a federal judge to strike a better deal beginning on Monday.

* Patrick Dempsey, best known for playing a hearthrob doctor on "Grey's Anatomy," said on Friday that he had prevailed in an auction of Tully's Coffee, a bankrupt coffee chain based in Seattle.

 

Canada

THE GLOBE AND MAIL

* Ontario Liberal leadership contender Glen Murray is calling for a "paradigm shift" in the way the province finances and develops public transit projects. Many people have difficulty getting to their offices, he said, because 90 percent are a kilometre or more away from subways, streetcars and other public transit systems.

* With fiscal prudence poised to take the spotlight in the British Columbia election, a special committee with a Liberal majority has decided to replace the province's outspoken auditor general John Doyle instead of renewing his term, according to the NDP Opposition.

Reports in the business section:

* Shaw Communications Inc's strategy to fend off competition from Telus Corp will come under scrutiny when the cable company releases its fiscal first-quarter results. The Calgary-based company is scheduled to report its financial results on Wednesday, just hours before its annual general meeting of shareholders.

NATIONAL POST

* Canada was on a list of terrorist targets found by U.S. Navy SEALs during the May 2011 raid on Osama bin Laden's compound in Abbottabad, Pakistan, according to a newly declassified intelligence report by the Integrated Threat Assessment Centre.

* The Canadian navy's joint support ship program is expected to come under the political microscope within weeks in what is likely another defence equipment embarrassment for the Harper government. The parliamentary budget officer has been examining the program and is poised to release his findings once MPs return from their Christmas break.

 

China

CHINA SECURITIES JOURNAL

-- More than 90 percent of Chinese fund managers recently polled by this newspaper forecast that China's stock market will stage a rebound this year. The market was generally weak over the past few years due in part to a slowdown of the world's second-largest economy.

-- China may not resume initial public offerings (IPOs) of shares in the first quarter of this year as firms which intend to float shares will be asked to add information on their 2012 annual results. IPOs were suspended in November due to the weak domestic stock market.

SHANGHAI SECURITIES

-- Top Chinese steel maker Baoshan Iron & Steel Co said it had so far bought back 1.92 billion yuan ($308 million) of its own shares in response to a regulatory call last year for listed companies to buy back their own shares to support the stock market.

SECURITIES TIMES

-- Livzon Pharmaceutical Group Inc said trading in its shares will be suspended starting Monday pending a major announcement. Analysts said the company may be planning to convert its Shenzhen-listed B-shares into Hong Kong-listed H-shares.

CHINA DAILY

-- With the majority of private enterprises in China faced with passing on the family business to the second generation, young entrepreneurs are facing a huge challenge in taking over family brands and presenting them to the world.

PEOPLE'S DAILY

-- A commentary urges government departments to stop sending gifts to each other during the Chinese lunar new year in mid-February to help fight against official corruption.

 

 

Fly On The Wall 7:00 AM Market Snapshot

ANALYST RESEARCH

Upgrades

British American Tobacco (BTI) upgraded to Buy from Hold at Deutsche Bank
Canon (CAJ) upgraded to Buy from Hold at Jefferies
Credit Suisse (CS) upgraded to Outperform from Sector Perform at RBC Capital
Ctrip.com (CTRP) upgraded to Equal Weight from Underweight at Barclays
Family Dollar (FDO) upgraded to Overweight from Equal Weight at Barclays
Flowers Foods (FLO) upgraded to Buy from Hold at Deutsche Bank
Georgia Gulf (GGC) upgraded to Neutral from Reduce at SunTrust
Harmon (HAR) upgraded to Outperform from neutral at RW Baird
Hess Corp. (HES) upgraded to Buy from Hold at Deutsche Bank
Hexcel (HXL) upgraded to Buy from Neutral at Goldman
Mettler-Toledo (MTD) upgraded to Buy from Neutral at BofA/Merrill
Northrop Grumman (NOC) upgraded to Sector Perform from Underperform at RBC Capital
Textron (TXT) upgraded to Outperform from Sector Perform at RBC Capital
Walgreen (WAG) upgraded to Buy from Hold at Jefferies

Downgrades

ArcelorMittal (MT) downgraded to Sector Perform from Outperform at RBC Capital
BNY Mellon (BK) downgraded to Sell from Neutral at Goldman
Cree (CREE) downgraded to Hold from Buy at Canaccord
DSW (DSW) downgraded to Hold from Buy at Brean Capital
Family Dollar (FDO) downgraded to Equal Weight from Overweight at Morgan Stanley
Finish Line (FINL) downgraded to Neutral from Buy at Janney Capital
Ingersoll-Rand (IR) downgraded to Market Perform from Outperform at Wells Fargo
Lowe's (LOW) downgraded to Sell from Hold at Canaccord
O'Reilly Automotive (ORLY) downgraded to Neutral from Overweight at Piper Jaffray
Rexnord (RXN) downgraded to Sell from Hold at Deutsche Bank
Spirit AeroSystems (SPR) downgraded to Sector Perform from Outperform at RBC Capital
Under Armour (UA) downgraded to Equal Weight from Overweight at Morgan Stanley
Watts Water (WTS) downgraded to Hold from Buy at Brean Capital

Initiations

SolarCity (SCTY) initiated with a Buy at Goldman
SolarCity (SCTY) initiated with a Buy at Roth Capital
SolarCity (SCTY) initiated with an Outperform at Credit Suisse
Spectrum Brands (SPB) coverage reinstated with a Buy at Deutsche Bank

HOT STOCKS

A.M Best withdrew rating of six life insurance units of AIG (AIG)
Nebraska Governor Heineman to review final Keystone pipeline (TRP) route proposal
US Airways (LCC), American Airlines (AAMRQ) pilots announced framework of employment agreement
Humana (HUM) expects higher sales for individual Medicare Advantage plans in 2013
Lenovo (LNVGY) introduced "Interpersonal Computing" with company’s first table PC
Illumina (ILMN) acquired Verinata Health for $350M

NEWSPAPERS/WEBSITES

U.S. businesses took on new office space at a sluggish pace in Q4, as employers remained cautious about adding jobs, the Wall Street Journal reports
This week Walgreen Co. (WAG) executives will outline what's ahead for the drugstore chain in 2013, with some analysts saying a busy flu season and firmer prescription orders could help the company outperform its rivals, the Wall Street Journal reports
Major U.S. technology companies could miss estimates for Q4 earnings as "fiscal cliff" concerns likely led some corporate clients to tighten their belts last month and hold off on spending all of their 2012 IT budgets, Reuters reports
The U.S. dominates the list of places that global commercial real estate investors would prefer to invest their money this year, while China has lost some luster and Turkey has drawn more interest, according to an annual survey by the Association of Foreign Investors in Real Estate, Reuters reports
China Investment Corp. may acquire a holding of 4% to 10% in Daimler AG (DDAIF), according to the Chinese newspaper People’s Daily which  reported the country’s sovereign-wealth fund may buy a stake in the luxury car maker, Bloomberg reports
The return of $10B-plus drug deals may be here as pharmaceutical companies including Pfizer (PFE) and Bristol-Myers Squibb (BMY) may be ready to start buying again. Five of the largest U.S. drug makers had more than $70B in cash, near cash and short-term investments at the end of the Q3, Bloomberg reports

BARRON’S

Delta Air Lines (DAL) is best-of-breed, could reach $18.00 per share
With new TLDs, VeriSign (VRSN) could see emulators emerge

SYNDICATE

lululemon (LULU) files to sell 5.7M shares of stock for Chairman Dennis Wilson

 


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Mon, 01/07/2013 - 08:42 | Link to Comment Sudden Debt
Sudden Debt's picture

Spend spend spend, no deal no deal no deal....

business as usual!!!

RALLY BITCHEZ!!

Mon, 01/07/2013 - 08:47 | Link to Comment Catullus
Catullus's picture

SolarCity (SCTY) initiated with a Buy at Goldman
SolarCity (SCTY) initiated with a Buy at Roth Capital
SolarCity (SCTY) initiated with an Outperform at Credit Suisse

 

hahahahaha.  Pump and Dump again.  so glad they came out with their forecasted sales. Let's see them actually execute on those sales first.

Mon, 01/07/2013 - 08:53 | Link to Comment Cookie
Cookie's picture

Grrr...here in Thailand Rolling Stone is a blocked site

Mon, 01/07/2013 - 08:56 | Link to Comment Ghordius
Ghordius's picture

VPN, bitchez

Mon, 01/07/2013 - 08:56 | Link to Comment Ralph Spoilsport
Ralph Spoilsport's picture

Have you tried this to get around the block?

http://www.ztunnel.com/

Apologies if you already tried it.

Mon, 01/07/2013 - 09:17 | Link to Comment JPM Hater001
JPM Hater001's picture

Ill get you started:

The federal rescue of Wall Street didn’t fix the economy – it created a permanent bailout state based on a Ponzi-like confidence scheme. And the worst may be yet to come.

By Matt Taibbi

It has been four long winters since the federal government, in the hulking, shaven-skulled, Alien Nation-esque form of then-Treasury Secretary Hank Paulson, committed $700 billion in taxpayer money to rescue Wall Street from its own chicanery and greed. To listen to the bankers and their allies in Washington tell it, you'd think the bailout was the best thing to hit the American economy since the invention of the assembly line. Not only did it prevent another Great Depression, we've been told, but the money has all been paid back, and the government even made a profit. No harm, no foul – right?

Wrong.

It was all a lie – one of the biggest and most elaborate falsehoods ever sold to the American people.

Mon, 01/07/2013 - 08:55 | Link to Comment Irelevant
Irelevant's picture

Tyler you forgot the plane in Istambul with 1.5 tonnes of gold grounded for lack of paper work.

Mon, 01/07/2013 - 08:59 | Link to Comment saturn
saturn's picture

Banks Win 4-Year Delay as Basel Liquidity Rule Loosened

 

...banks win again, ey?

Mon, 01/07/2013 - 09:03 | Link to Comment Disenchanted
Disenchanted's picture

From Pravda January 4, 2013...delicious irony.

Global warming, the tool of the West

 

btw:

Climate Money by Joanne Nova  (2009)

Scince and Public Policy Institute . org

an excerpt:

 

The stealthy mass entry of bankers and traders into the background of the scientific “debate” poses grave threats to the scientific process. The promise of “trillions of dollars” on commodity markets—with all of that potential money hinging on finding that human emissions of carbon dioxide have a significant role in the climate—surely acts like blanket of mud over open dispassionate analysis.

Mon, 01/07/2013 - 09:04 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Told you so bitchez!

Mon, 01/07/2013 - 09:18 | Link to Comment Bob
Bob's picture

Interesting.  Is this to say that the vast sums they've spent to date on cultivating denial have reached the end of their service lives and now it's time to pivot to developing "wealth" from the other side of the proposition?

But, damn, that sounds like a conspiracy theory. 

 

Mon, 01/07/2013 - 09:25 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

That first step out of the cult compound.....is a hell of a thing.

Mon, 01/07/2013 - 09:34 | Link to Comment Disenchanted
Disenchanted's picture

 

"Is this to say that the vast sums they've spent to date on cultivating denial"

 

You mean 'vast sums' like this...

From the Climate Money link:

 

Meanwhile in a distracting sideshow, Exxon-Mobil Corp is repeatedly attacked for paying a grand total of $23 million to skeptics—less than a thousandth of what the US government has put in, and less than one five-thousandth of the value of carbon trading in just the single year of 2008.

 

The large expenditure in search of a connection between carbon and climate creates enormous momentum and a powerful set of vested interests. By pouring so much money into a question have we inadvertently created a self-fulfilling prophesy instead of an unbiased investigation?

 

Can science survive the vice-like grip of politics and finance?

 

Vaster sums have been spent developing wealth from the other side of the proposition already.

Mon, 01/07/2013 - 09:06 | Link to Comment Racer
Racer's picture

Softening of rules, now there's not a surprise!

Mon, 01/07/2013 - 09:07 | Link to Comment Disenchanted
Disenchanted's picture

Another Pravda gem from last month:

 

It is suggested that the USA gets its own house in order before dictating to the rest of the world.  Use the many blessings and resources of the land and people for your own people and not for trotting around the globe killing others for fun and profit while those at home suffer.  The capitalist system sees people as a disposable commodity, to be thrown out if not productive or useful in some way.  To be thrown out if blocking the wishes of the elite.  That's just not going to impress anyone to adopt the so-called "American Dream" which in reality is the American nightmare.  For its own citiznes and for the unfortunate citizens of the world who get in their way.

 

Excerpt from:

USA Land of disposable people
Mon, 01/07/2013 - 09:08 | Link to Comment HD
HD's picture

The Rolling Stone article is worth the time. Nothing new to ZH fringe blog readers but a good refresher of the past four years of bullshit...

Mon, 01/07/2013 - 09:32 | Link to Comment Zgangsta
Zgangsta's picture

Indentured servancy is the new freedom!

Mon, 01/07/2013 - 09:54 | Link to Comment Crassus
Crassus's picture

Yes, the goal, whispered about in the 1990s, to merge down to four or five superbanks to better compete with the huge foreign nationals, has been realized.

Mon, 01/07/2013 - 09:30 | Link to Comment Zgangsta
Zgangsta's picture

Looks like the 8am PM smackdowns are back on.

Mon, 01/07/2013 - 10:55 | Link to Comment mccoyspace
mccoyspace's picture

Agreed that the Tiabbi article in RS is really great.

Mon, 01/07/2013 - 11:48 | Link to Comment illyia
illyia's picture

Tylers - it would be so useful to have an expose on AIG. How the hell could they have actually "paid back" the American people.

AIG is keystone, imo.

 

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