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Frontrunning: December 11
- Shale operaters Goodrich, Oasis Petroleum cut spending for 2015 as oil slides (Reuters)
- Greece to hold elections in January if president vote fails (Reuters)
- Norway’s Shock Rate Cut Drives Krone to Lowest Since 2009 (BBG)
- ‘Severe Downturn’ Threatening Norway, Central Bank Governor Says (BBG)
- Russia’s Fifth Rate Increase Fails to Halt Ruble Slide to Record (BBG)
- SNB Says Deflation Risks Increased as Franc Cap Maintained (BBG)
- China eases bank lending restrictions, PBOC targets 10 trillion yuan in loans for 2014 (Reuters)
- Mobius Says China’s Bull Market Is Just Getting Started (BBG)
- How Wal-Mart Made Its Crumbling China Business Look So Good for So Long (BBG)
- Japan machinery orders tumble in another blow to economy and PM Abe (Reuters)
- It’s a weird war when Iran and the U.S. are bombing the same country (Reuters)
- Banks only take €130bn of cheap loans from ECB (FT)
- Psychologist says U.S. Senate's CIA report makes false charges (Reuters)
- Hong Kong police haul protesters away as camp site is dismantled (Reuters)
- New Jersey voters say U.S. not ready for president 'Jersey Guy' Christie (Reuters)
Overnight Media Digest
WSJ
* Starboard Value LP has built a roughly 6 percent stake in Staples Inc and increased its position in Office Depot Inc to about 10 percent, according to people familiar with the matter, moves that could increase pressure for a combination of the office-supply retailers. (on.wsj.com/1un4jRL)
* In a blow to the Justice Department's Wall Street crackdown, a federal appeals court, U.S. Circuit Court of Appeals, overturned two insider-trading convictions and ruled it is not always illegal to buy or sell stocks using inside information. (on.wsj.com/12x70cT)
* A top official at the Securities and Exchange Commission has taken the unusual step of saying Harvard University could be vulnerable to legal action from the agency or investors over a corporate governance project. (on.wsj.com/1Dezj0w)
* Standard Chartered Plc on Wednesday said it has created a new board committee to focus on financial crime, a move that follows the extension of a deferred prosecution agreement with U.S. authorities. (on.wsj.com/1zzeuch)
* Philadelphia's transit agency has sued Gilead Sciences Inc , accusing the company of "price-gouging" on the sale of its $1,000-per-pill hepatitis C drug Sovaldi, the latest salvo in a battle between health-care payers and the pharmaceutical industry over prices. (on.wsj.com/1vSvn0x)
* EBay Inc is considering a plan to eliminate thousands of jobs early next year as it prepares to split off its PayPal payments unit, according to people familiar with the company's thinking. (on.wsj.com/1BA9lmD)
FT
* BP will cut thousands of jobs cut across its global oil and gas business over the coming year in a $1 billion restructuring programme announced on Wednesday following steep falls in oil prices.
* Standard Chartered has set up a board committee responsible for financial crime compliance, a day after U.S. authorities extended monitoring of the bank by three years.
* Eneva SA, the Brazilian power producer controlled by Germany's E.ON SE and tycoon Eike Batista, filed for creditor protection on Tuesday after failing to refinance part of its 2.33 billion reais ($900 million) in debt.
* Airbus Group cut its earnings expectation for 2016 on Wednesday. It also announced that delivery of its new A350 jet to its first customer Qatar Airways had been delayed.
NYT
* Starboard Value acquired a roughly 6 percent stake in Staples Inc, a person briefed on the matter said on Wednesday. The hedge fund also bolstered its holdings in Office Depot Inc - where it previously sat on the board - to 10 percent, from 8.6 percent. (nyti.ms/1uoWBY6)
* Morgan Stanley agreed on Wednesday to pay a $4 million fine for failing to properly limit a rogue trader whose $1 billion bet on Apple Inc stock brought down the firm where he worked. (nyti.ms/12x8Hak)
* Sony Corp was scrambling on Wednesday to cope with the fallout from the incendiary emails posted by Gawker, the tabloid news site, that revealed an ugly internal battle between Amy Pascal, Sony's co-chairwoman, and the producer Scott Rudin over Angelina Jolie and a planned Steve Jobs biopic. (nyti.ms/12PhZhF)
* Despite an improving economy and jobs picture, the public is more pessimistic than it was after the 2008 financial crisis that it is possible to work hard and become rich, according to a New York Times poll. (nyti.ms/1unoP4z)
* A former JPMorgan Chase & Co executive, Paul Camp, who led JPMorgan's global transaction services, is set to join a digital currency start-up, Circle Internet Financial, part of a fledgling industry that is seeking to topple the traditional financial system. (nyti.ms/1IDc9RS)
* The United States Court of Appeals for the Second Circuit in Manhattan overturned two of the government's signature convictions for insider trading, the case against the former hedge fund traders Todd Newman and Anthony Chiasson, who were tried together. (nyti.ms/13ajRCU)
China
CHINA SECURITIES JOURNAL
- Year-end liquidity pressures to meet regulatory requirements have pushed China's five biggest state-owned commercial banks, Bank of China, Industrial and Commercial Bank of China, Agricultural Bank of China , China Construction Bank, and Bank of Communications to raise their deposit interest rates by a maximum of 20 percent to encourage people to deposit money.
- China Merchants Bank said Anbang Insurance Group has increased its stake in the bank to 10 percent. Anbang will continue to expand its position in China Merchants through a private placement over the next twelve months, it said.
SHANGHAI SECURITIES NEWS
- The recent fluctuation in China's stock market might mark the end of a recent sharp rise in brokerage stocks, but the market is still bullish and capital is likely to keep chasing sectors seen to be supported by government policy, the newspaper said in a front-page commentary.
CHINA DAILY
- China will put out a major reform plan for its state-owned enterprises early next year to help these firms expand globally, modernize their management and become more innovative, the secretary-general of the State-Owned Assets Supervision and Administration Commission said on Wednesday.
Britain
The Times
FALLING OIL PRICES AND NORTH SEA PLATFORMS CUT BRITAIN'S TRADE DEFICIT
Falling oil prices and North Sea platforms coming back on line helped drive Britain's trade deficit down to its lowest level in seven months in October. Imports of goods and services were 2 billion pounds higher than UK exports in October, a sharp improvement on September's 2.8 billion pounds ($4.41 billion)deficit. (http://thetim.es/1qx9kfh)
CONSUMERS 'OVERPAYING FOR ENERGY COSTS', SAYS NEW OFGEM BOSS
The new head of Ofgem has accused the regulator's previous regime of failing 15 million households that have not switched supplier and are paying over the odds as a result. (http://thetim.es/1zNHc7o)
The Guardian
BRITISH MPS DEMAND INQUIRY INTO UK'S ROLE IN CIA ABDUCTIONS
MPs and human rights groups have demanded a judge-led inquiry into Britain's involvement in CIA abductions of terror suspects, following the devastating U.S. Senate intelligence committee's report. (http://bit.ly/1wzCFIp)
HSBC FIRES TOP FOREX TRADING EXECUTIVE
HSBC Holdings Plc fired a top foreign exchange trading executive a month after being fined 389 million pounds by U.S. and UK regulators over market rigging. Stuart Scott, head of forex trading for Europe, the Middle East and Africa, was dismissed on Tuesday, sources confirmed. (http://bit.ly/139abIO)
The Telegraph
SKY CONSIDERS WITHDRAWAL OF NOW TV FROM YOUVIEW
Row over costs and slow development threatens streaming distribution deal with BT and TalkTalk set-top-box consortium. Sky could withdraw its Now TV streaming service from BT and TalkTalk's television subscribers in a row over costs and the slow development of the YouView set-top-box technology they use. (http://bit.ly/1qw79Zf)
CRYSTAL AMBER CLOSES IN ON SAINSBURY'S SHARE RAID WITH PLANS TO RAISE NEW FUND
Crystal Amber the UK activist fund, is planning to raise fresh firepower to target Britain's biggest blue-chip companies fuelling speculation that it is moving closer to a share raid on Sainsbury. (http://bit.ly/1392fHq)
Sky News
FCA BOSSES FACE SECOND BONUS BLOW OVER PROBE
The City watchdog's top executives could have their bonuses withheld or reduced for a second consecutive year following a coruscating report on its handling of an inquiry into the insurance industry. (http://bit.ly/12vjjGH)
BP TO SPEND $1 BLN ON GLOBAL RESTRUCTURE
Oil giant BP has announced plans for major restructuring across its global operations. The announcement of the $1 billion plan comes as crude oil prices have continued to slide, reaching five-year lows in December. (http://bit.ly/1Ah2A4T)
The Independent
CITY WATCHDOG LAMBASTED OVER INSURANCE FIASCO THAT WIPED BILLIONS OF POUNDS FROM INDUSTRY
Britain's financial watchdog was chastised in a damning report accusing it of being "high risk, poorly supervised and inadequately controlled" after wiping billions off the value of the City's insurers. (http://ind.pn/12O66IY)
THE TOP 25 PLACES TO WORK IN THE UK: GOOGLE TOPS LIST DECIDED BY EMPLOYEES
Google Inc's culture and the level of trust given to its employees have seen it named the best place to work in the UK, according to worker feedback. (http://ind.pn/167uCH6)
Fly On The Wall Pre-Market Buzz
ECONOMIC REPORTS
Domestic economic reports scheduled for today include:
Jobless claims for week of Dec. 6 at 8:30--consensus 295K
Retail sales for November at 8:30--consensus up 0.4%
Business inventories for October at 10:00--consensus up 0.3%
ANALYST RESEARCH
Upgrades
Amdocs (DOX) upgraded to Buy from Neutral at Goldman
Clear Channel Outdoor (CCO) upgraded to Outperform from Market Perform at Wells Fargo
Eli Lilly (LLY) upgraded to Overweight from Underweight at Morgan Stanley
GOL Linhas (GOL) upgraded to Overweight from Neutral at JPMorgan
Mid-America Apartment (MAA) upgraded to Buy from Hold at KeyBanc
Prologis (PLD) upgraded to Buy from Hold at Deutsche Bank
The Advisory Board (ABCO) upgraded to Buy from Hold at Stifel
Vital Therapies (VTL) upgraded to Outperform from Neutral at Credit Suisse
Downgrades
ARIAD (ARIA) downgraded to Underperform from Neutral at Credit Suisse
AbbVie (ABBV) downgraded to Equal Weight from Overweight at Morgan Stanley
Aimco (AIV) downgraded to Hold from Buy at KeyBanc
Anglo American (AAUKY) downgraded to Underperform from Neutral at Exane BNP Paribas
Approach Resources (AREX) downgraded to Underperform from Neutral at Sterne Agee
Fifth Street Senior (FSFR) downgraded to Perform from Outperform at Oppenheimer
Macerich (MAC) downgraded to Hold from Buy at Deutsche Bank
Olin Corp. (OLN) downgraded to Underperform from Neutral at Longbow
Prudential plc (PUK) downgraded to Neutral from Buy at Nomura
Suncor (SU) downgraded to Neutral from Buy at BofA/Merrill
Thompson Creek (TC) downgraded to Hold from Buy at Deutsche Bank
Toll Brothers (TOL) downgraded to Underperform from Sector Perform at RBC Capital
Travelers (TRV) downgraded to Neutral from Buy at UBS
United Therapeutics (UTHR) downgraded to Underperform from Neutral at Credit Suisse
Initiations
Adeptus Health (ADPT) initiated with an Outperform at JMP Securities
BE Aerospace when-issued (BEAVV) initiated with a Buy at Goldman
Cenveo (CVO) initiated with an Outperform at Macquarie
Deluxe (DLX) initiated with an Outperform at Macquarie
Dynagas LNG (DLNG) initiated with a Hold at Canaccord
EPAM Systems (EPAM) initiated with a Buy at Jefferies
Echo Global (ECHO) initiated with a Neutral at Macquarie
Ennis (EBF) initiated with an Underperform at Macquarie
FedEx (FDX) initiated with a Neutral at UBS
Forward Air (fwrd) initiated with a Neutral at Macquarie
GasLog Partners (GLOP) initiated with a Hold at Canaccord
GasLog (GLOG) initiated with a Buy at Canaccord
Genpact (G) initiated with a Buy at Jefferies
Matthews (MATW) initiated with a Neutral at Macquarie
Navios Maritime Midstream (NAP) initiated with an Overweight at JPMorgan
PACCAR (PCAR) initiated with a Buy at Global Hunter
Qlik Technologies (QLIK) initiated with an Outperform at Wedbush
R.R. Donnelley (RRD) initiated with an Outperform at Macquarie
Roadrunner (RRTS) initiated with a Neutral at Macquarie
Sonus (SONS) initiated with a Buy at B. Riley
Stillwater Mining (SWC) initiated with a Buy at BofA/Merrill
Tableau (DATA) initiated with an Outperform at Wedbush
Teekay LNG (TGP) initiated with a Buy at Canaccord
UPS (UPS) initiated with a Neutral at UBS
Virgin America (VA) initiated with a Buy at CRT Capital
XPO Logistics (XPO) initiated with an Outperform at Macquarie
COMPANY NEWS
Walgreens (WAG) CEO Greg Wasson announced retirement after Alliance merger. Stefano Pessina, executive chairman of Alliance Boots and a member of the Walgreens board, will serve as its acting CEO, pending a board search for a successor
Google (GOOG) will shut Google News in Spain as a result of a new Spanish law
CONSOL (CNX) board authorized management to pursue MLP formation, announced $250M share repurchase program
Lowe's (LOW) CEO sees ROIC reaching 19% by 2017
Urban Outfitters (URBN) said Q4 SSS up low single-digit thus far in Q4
Starboard raised stake in Office Depot (ODP) to 9.9% from 8.6% and reported a new stake of 5.1% in Staples (SPLS)
EARNINGS
Companies that beat consensus earnings expectations last night and today include:
lululemon (LULU), Sigma Designs (SIGM), INTL FCStone (INTL), Comtech (CMTL), Aviat Networks (AVNW), Synergetics (SURG), Casey's General Stores (CASY), Restoration Hardware (RH), Central Garden & Pet Co. (CENTA)
Companies that missed consensus earnings expectations include:
Men's Wearhouse (MW), Wet Seal (WTSL), Oxford Industries (OXM)
Companies that matched consensus earnings expectations include:
Peregrine (PPHM)
Lowe's (LOW) sees FY14 EPS about $2.68, consensus $2.67
Danaher (DHR) sees FY15 adjusted EPS $4.35-$4.45, consensus $4.01, backs Q4 EPS view of $1.00-$1.04, consensus $1.02
lululemon (LULU) sees FY14 normalized EPS $1.74-$1.78, consensus $1.77, sees Q4 EPS 65c-69c, consensus 72c
Aetna (AET) sees FY15 operating EPS at least $6.90, consensus $7.17, backs FY14 operating EPS $6.60-$6.70, consensus $6.68
NEWSPAPERS/WEBSITES
eBay (EBAY) considering cutting 'thousands' of jobs next year, WSJ reports
Starboard may push for Staples (SPLS), Office Depot (ODP) merger, WSJ reports
Wal-Mart used questionable accounting, sales practices in China, Bloomberg reports
Nike (NKE) CIO Anthony Watson leaves company after 10 months, Business Insider reports
Qualcomm (QCOM) cutting 600 jobs worldwide, CNet reports
American Airlines (AAL), United Continental (UAL) can reach new highs, Barron's says
SYNDICATE
ARAMARK (ARMK) files to sell 25M shares for holders
Bright Horizons (BFAM) files to sell 8M shares for holders
Burlington Stores (BURL) files to sell 8M shares for holders
HD Supply (HDS) files to sell 40.66M shares for holders
LendingClub (LC) 58M share IPO priced at $15.00
MEI Pharma (MEIP) files to sell $45M shares of common stock
Mattress Firm (MFRM) files to sell 2.18M shares for holders
Momo (MOMO) 16M share IPO priced at $13.50
Nielsen (NLSN) files to sell 20M shares for holders
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In a blow to the Justice Department's Wall Street crackdown...
NOW THAT'S FUNNY!!
FREE CORZINE, FREE COHEN, FREE DIMON, FREE PAULSON(x2)
Would love to see the Greek vote fail and there be snap elections.
It never ceases to amaze me how the most fragile of coalitions hold together if the coalition supports the EU. If however, the coalition or its respective head begins to turn against the EU, there is a vote of no confidence, and a new pro-EU government forms -- almost immediately.
I have no doubt this will be no different. This farce will continue -- and there will be a certain poster on here the continues to insist there is nothing at all odd about the above.
yes, I understood, whatever causes a big splash! bang! or splat! is heavenly music for your ears
but I have one question: the Greek constitution puts a lot of power in the hands of 300 elected MPs, including the right to appoint the president and the administration. Or to kick out an administration and appoint a different one, something that still seems to shock you
How many of them do you think share your views on things in general, and the EU in particular? How many of those who elect them?
imho they might bitch mightily on certain issues, but they do share a certain consensus on others. And it's not that Greeks haven't plenty of choice, when they vote. they can elect parties from Golden Dawn to Communist, remember?
How many of them do you think share your views on things in general, and the EU in particular?
Almost half.
that is a tall call. fine, so we are talking about almost 150 out of 300. Here are the last electoral results, of 2012. Assume I'm the acting Prez of Greece, and I appoint you as the designated Prime Minister of Greece. Pick your ruling coalition, and tell me which parties you selected
Syriza and Golden Dawn. Because both parties hate one another the deal would be this --
Syriza/GD coalition. After swearing in -- the new PM tells the EMZ they either get all their debts forgiven, and a 30% of Greek GDP subsidy per year payable tomorrow. If this does not happen in 24 hours -- the Greek government would officially default and write off all debt. Thereafter the Prime Minister would immediately tell the Greek Central Bank to re-issue the Drachma. The coalition would have to hold together for a week or two until this process passes the "point of no return" once panic spreads through the world's market and the collapse begins -- I would resign and call snap elections for Greece to choose a new government to lead it in its new chapter.
Of course, this would all have to be done from a bunker where no one is allowed in and out.
oh, I see I put the wrong comment at the wrong place
the original comment (now somewhere else)
---------
So you would select a "coalition of the radical left", which in the last elections had
SYRIZA (Coalition of the Radical Left): 52 seats; DIMAR (Democratic Left): 19 seats and KKE (Communist Party of Greece): 12 seats - with a current total of 83 seats - with the assumption that in the next elections they make over 150?
I repeat: the Radical Left, the Democratic Left and the Communist? That's your choice, Mr. Designated Prime Minister of Greece?
...........
but this reply of yours is even better! the Left and Golden Dawn
how do you keep them in one room without getting to fistcuffs, Mr. Designated Prime Minister? They literally hate each other's guts
we are talking of fascists and communist or near-communist. If you really can pull this off, you might become the new, greatest leader of europe
So the KKE then. I don't really care. Just any group of people in Greece that are willing to bend the EMZ over the barrel that it really is over, and be a bit crazy enough to blow up the entire system to prove their point.
so you are looking for a majority of Greeks to be "a bit crazy enough to blow up the entire system to prove their point"
I wonder how they would react if you put that in those terms. Would Americans follow such a call? I have difficulties imagining any european People doing that, but that's perhaps me
No -
I am looking for a majority of Greeks to come to the conclusion that the EUR is sucking their system dry and they will be forever impoverished unless they take dramatic steps. These dramatic steps involve threatening the world with weapons of mass financial destruction, to get a ton of money pumped into their system to bring their country back from 2nd world status. I expect their politicians be a bit crazy -- as going toe to toe with this much cash and this much of a entrenched interests -- one has to be a little nuts to attempt it.
as I mentioned in the other thread, last time they were "a bit crazy", they listened to the Squid, cooked their books and lied to their european partners. which nearly threw them out
many German politicians asked exactly for that, with a choir of other nation's politicians in support. I think you overestimate the bargaining position. But that's perhaps me
SBM Offshore to axe 1200 jobs
http://worldmaritimenews.com/archives/146800/sbm-offshore-to-axe-1200-jobs/
well we have cia gate, to distract from : 1.1 trillion funding bill which no congressmen have read- we have gruber refusing to say how much he was paid by obuma and co ..a few weeks back Aig trial with out ZH coverage (unthinkable in days of old on ZH)..look cia sure it's well known -but it seems much like the passage of FED reserve act in christmas of years ago, look over there is being used like a maestro on his violin..and ZH and posters fall right in line..eyes wide shut.
ps I am visiting my local congressmans office today to speak my displeasure at this monster 1.1 trillion omnibus spending bill. what you doing?
http://davidstockmanscontracorner.com/duck-and-cover-the-lull-is-breaking-the-storm-is-nigh/?utm_source=wysija&utm_medium=email&utm_campaign=Mailing+List+AM+Wednesday Duck And Cover——-The Lull Is Breaking, The Storm Is Nigh