Best Buy’s Collapse Was Not A Surprise To This Man

It would appear that the meteoric 300% rise of Best Buy’s shares last year was promoted to the general investing public as the renaissance of the on-the-verge-of-bankruptcy warehouse store and sure enough, the world and his mom piled in to chase the momo higher and higher… until today. With a 30% tumble this morning, those momo-chasing moms and pops may be less enamored to buy-the-dip but there was one ‘smart-money’ insider who was selling as fast as retail was buying. Co-Founder Richard Schulze (who indicated in August he would be selling to ‘diversify’ his holdings) piled out of the stock through most of the fourth quarter (at a level well above this morning’s opening print).

 

 

Chart: Bloomberg


    



via Zero Hedge http://ift.tt/1mb31bH Tyler Durden

Who Has The Time And Motivation to Comprehend The Mess We're In? Almost Nobody

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

If we don't understand the problem or the dynamics that are generating the problem, it is impossible to reach a solution or practical plan of action.

When it comes time to assess our grasp of the dynamics of this unprecedented era, how do you reckon historians will grade our collective political "leadership," intelligentsia, central state, corporate leadership and the "common man/woman" citizen? Did we rise to the occasion or did we falter, not in acting to counter the dissolution of the Status Quo, but in simply making a concerted effort to understand the tangled web of lies, corruption, perverse incentives, unintended consequences, simplistic (and utterly misguided) ideologies, not to mention the real-world limits of a supposedly limitless world, that have become the key dynamics of this era?

I suspect future historians (presuming the funding of such scholarly assessments survives) will grade all categories either F or D-. The reasons are not difficult to discern, and it behooves us to understand why we are collectively so ill-prepared to understand our era, much less fix what's broken before the whole over-ripe mess collapses in a heap.

1. Intellectual laziness. Very few people are willing to work hard enough to figure things out on their own. It's so much easier to join Paul Krugman dancing around the fire of the Keynesian Cargo Cult, chanting "aggregate demand! Humba-Humba!" while waving dead chickens than ditch reductionist, naive ideologies and actually work through an independent analysis.

2. Independent thinking is an excellent way to get fired, demoted or sent to Siberia. Though America claims to value independent thinking, this is just another pernicious lie: what America values is the ability to mask failing conventional ideas and systems with a thin gloss of "fresh thinking."
In other words, what the American state and corporatocracy value is the appearance of independent thinking, not the real thing. Since the real thing will get you fired, everyone who works for government or Corporate America masters the fine arts of producing simulacra, legerdemain and illusion. This only further obscures the real dynamics, making legitimate analysis that much more difficult.

3. Relatively few have any incentive to question authority, the state or the corporatocracy. Humans excel at figuring out which side of the bread is buttered, and who's lathering on the butter: self-interest is the ultimate human survival trait (we cooperate because it serves our self-interest to do so).

While we cannot hold the pursuit of self-interest against any individual–after all, who among us truly acts selflessly when push comes to shove?–we can monitor the monumentally negative consequences of self-interest and complicity on the systems and Commons we share.

When roughly half of all households are drawing direct cash/benefits from the central state, how many of those people are interested in doing anything that might put their place at the feeding trough at risk? Sure, people will grouse about this or that (usually related to the conviction that they deserve more or have been cheated out of "their fair share"), but as long as the government payments, direct deposits and benefits keep coming, what possible motivation is there for the recipients to devote energy to investigating the potential collapse of the gravy train?

Corporate America is no different. The store may be devoid of customers, but the employees will strive to look busy to keep the paychecks coming until the inevitable lay-off/implosion occurs. How many Corporate America employees will critique their way out of a paycheck? In an environment this difficult for job-seekers, you'd be nuts to bother figuring out why your division is failing, knowing as you do that the truth will result in the "termination with extreme prejudice" of the naive fools who presented the truth as if it would be welcome
.
Does anyone seriously imagine that any employee of a bloated bureaucracy will ever voluntarily challenge the squandering of revenues when that might cost them their own paycheck, bonus, contract for their brother-in-law, etc.? A few protected people (professors with tenure, for example) can be "brave," but their "bravery" is cheap: their protestations cannot trigger termination with extreme prejudice, so the gesture of resistance is just that, a gesture.

4. Those relative few who might have a real motivation to undertake independent analysis have little time to pursue this noble project. They are working absurd hours and enduring absurd commutes. Between getting the bundles of diapers into the elevator and planning what to cook for dinner, there is precious little time or energy left for figuring out the mess we're in. Just getting to a second or third job can suck up a significant amount of time, money amd energy.

And so the busy employee/sole-proprietor/contract worker listens to NPR or some talk radio program for a few minutes, reinforcing their ideology of choice, and turns on the "news" (laughably bad propaganda churned up with "if it bleeds, it leads") as background noise and spends whatever personal time they have on Roku, Netflix, Facebook, Twitter, email, etc. seeking distraction or solace from the daily workload.

In a strange irony, there are plenty of citizens who have plenty of time (recall that Americans manage to watch 6-8 hours of TV a day), but their marginalized status and dependence on the state drains them of motivation to do anything but seek amusement and distraction.

If we don't understand the problem or the dynamics that are generating the problem, it is impossible to reach a solution or practical plan of action. In other words, the four points above doom us just as surely as the dynamics of insolvency, corruption, debt servitude, Tyranny of the Majority, etc. etc. etc.

Choose your metaphor of choice, but rearranging the deck chairs on the Titanic has a nice ironic texture in an election year, when the "news" will be focusing on rearranging the political deck chairs on the first class deck–at least when there's no celebrity ruckus or "if it bleeds, it leads" to crowd out what passes for "hard news" in a regime dedicated to the distractions of bread and circuses.



    



via Zero Hedge http://ift.tt/1hutIoS Tyler Durden

Who Has The Time And Motivation to Comprehend The Mess We’re In? Almost Nobody

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

If we don't understand the problem or the dynamics that are generating the problem, it is impossible to reach a solution or practical plan of action.

When it comes time to assess our grasp of the dynamics of this unprecedented era, how do you reckon historians will grade our collective political "leadership," intelligentsia, central state, corporate leadership and the "common man/woman" citizen? Did we rise to the occasion or did we falter, not in acting to counter the dissolution of the Status Quo, but in simply making a concerted effort to understand the tangled web of lies, corruption, perverse incentives, unintended consequences, simplistic (and utterly misguided) ideologies, not to mention the real-world limits of a supposedly limitless world, that have become the key dynamics of this era?

I suspect future historians (presuming the funding of such scholarly assessments survives) will grade all categories either F or D-. The reasons are not difficult to discern, and it behooves us to understand why we are collectively so ill-prepared to understand our era, much less fix what's broken before the whole over-ripe mess collapses in a heap.

1. Intellectual laziness. Very few people are willing to work hard enough to figure things out on their own. It's so much easier to join Paul Krugman dancing around the fire of the Keynesian Cargo Cult, chanting "aggregate demand! Humba-Humba!" while waving dead chickens than ditch reductionist, naive ideologies and actually work through an independent analysis.

2. Independent thinking is an excellent way to get fired, demoted or sent to Siberia. Though America claims to value independent thinking, this is just another pernicious lie: what America values is the ability to mask failing conventional ideas and systems with a thin gloss of "fresh thinking."
In other words, what the American state and corporatocracy value is the appearance of independent thinking, not the real thing. Since the real thing will get you fired, everyone who works for government or Corporate America masters the fine arts of producing simulacra, legerdemain and illusion. This only further obscures the real dynamics, making legitimate analysis that much more difficult.

3. Relatively few have any incentive to question authority, the state or the corporatocracy. Humans excel at figuring out which side of the bread is buttered, and who's lathering on the butter: self-interest is the ultimate human survival trait (we cooperate because it serves our self-interest to do so).

While we cannot hold the pursuit of self-interest against any individual–after all, who among us truly acts selflessly when push comes to shove?–we can monitor the monumentally negative consequences of self-interest and complicity on the systems and Commons we share.

When roughly half of all households are drawing direct cash/benefits from the central state, how many of those people are interested in doing anything that might put their place at the feeding trough at risk? Sure, people will grouse about this or that (usually related to the conviction that they deserve more or have been cheated out of "their fair share"), but as long as the government payments, direct deposits and benefits keep coming, what possible motivation is there for the recipients to devote energy to investigating the potential collapse of the gravy train?

Corporate America is no different. The store may be devoid of customers, but the employees will strive to look busy to keep the paychecks coming until the inevitable lay-off/implosion occurs. How many Corporate America employees will critique their way out of a paycheck? In an environment this difficult for job-seekers, you'd be nuts to bother figuring out why your division is failing, knowing as you do that the truth will result in the "termination with extreme prejudice" of the naive fools who presented the truth as if it would be welcome
.
Does anyone seriously imagine that any employee of a bloated bureaucracy will ever voluntarily challenge the squandering of revenues when that might cost them their own paycheck, bonus, contract for their brother-in-law, etc.? A few protected people (professors with tenure, for example) can be "brave," but their "bravery" is cheap: their protestations cannot trigger termination with extreme prejudice, so the gesture of resistance is just that, a gesture.

4. Those relative few who might have a real motivation to undertake independent analysis have little time to pursue this noble project. They are working absurd hours and enduring absurd commutes. Between getting the bundles of diapers into the elevator and planning what to cook for dinner, there is precious little time or energy left for figuring out the mess we're in. Just getting to a second or third job can suck up a significant amount of time, money amd energy.

And so the busy employee/sole-proprietor/contract worker listens to NPR or some talk radio program for a few minutes, reinforcing their ideology of choice, and turns on the "news" (laughably bad propaganda churned up with "if it bleeds, it leads") as background noise and spends whatever personal time they have on Roku, Netflix, Facebook, Twitter, email, etc. seeking distraction or solace from the daily workload.

In a strange irony, there are plenty of citizens who have plenty of time (recall that Americans manage to watch 6-8 hours of TV a day), but their marginalized status and dependence on the state drains them of motivation to do anything but seek amusement and distraction.

If we don't understand the problem or the dynamics that are generating the problem, it is impossible to reach a solution or practical plan of action. In other words, the four points above doom us just as surely as the dynamics of insolvency, corruption, debt servitude, Tyranny of the Majority, etc. etc. etc.

Choose your metaphor of choice, but rearranging the deck chairs on the Titanic has a nice ironic texture in an election year, when the "news" will be focusing on rearranging the political deck chairs on the first class deck–at least when there's no celebrity ruckus or "if it bleeds, it leads" to crowd out what passes for "hard news" in a regime dedicated to the distractions of bread and circuses.


    



via Zero Hedge http://ift.tt/1hutIoS Tyler Durden

Prescription Drug Price Plunging By Most On Record Keeps Tepid Inflation In Line With Expectations

If yesterday’s rising PPI print suggested the Fed may continue its $10 billion a month taper at its next meeting, today’s comparably rising CPI for December will likely mean that absent another payroll-like shock, the Fed will soon monetize “only” $65 billion per month. The reason: in December core consumer inflation rose by 0.3%, compared to the 0.0% change in November, and in line with expectations. Stripping away food and energy however, the increase was only 0.1%, also in line with expectations, and a decline from November’s 0.2% increase. More importantly, on a Y/Y basis, core CPI was up by 1.7%, still shy of the Fed’s 2% target but not too far.

This is where the BLS said the growth was:

Advances in energy and shelter indexes were major factors in the increase in the seasonally adjusted all items index. The gasoline index rose 3.1 percent, and the fuel oil and electricity indexes also increased, resulting in a 2.1 percent increase in the energy index. The shelter index rose 0.2 percent in December. The indexes for apparel, tobacco, and personal care increased as well. These increases more than offset declines in the indexes for airline fares, for recreation, for household furnishings and operations, and for used cars and trucks, resulting in the index for all items less food and energy rising 0.1 percent.

For those seeking the lack of inflation in food, the BLS suggests you look in the fruit section:

The food index rose slightly in December, increasing 0.1 percent. The food at home index was unchanged for the third time in four months, as a sharp decline in the fruits and vegetables index offset other increases. The food index has not posted a monthly increase larger than 0.1 percent since June

The full breakdown by component:

The narrative from the report:

Food

 

The food index rose 0.1 percent in December, the same increase as in November. The index for food at home was unchanged, although four of the six major grocery store food groups posted increases. The index for nonalcoholic beverages, which declined in November, rose 0.5 percent in December. The index for dairy and related products rose 0.4 percent for the second month in a row, while the indexes for meats, poultry, fish, and eggs and for other food at home both rose 0.3 percent. Offsetting these increases was a sharp decline in the fruits and vegetables index; it fell 1.5 percent as the fresh vegetables index declined 2.7 percent. The index for cereals and bakery products also declined, falling 0.1 percent. The index for food away from home rose 0.1 percent in December after a 0.3 percent increase in November.

 

Energy

 

The energy index rose 2.1 percent in December after falling in October and November. The energy index has now risen 0.2 percent over the last six months. The gasoline index, which fell 1.6 percent in November, rose 3.1 percent in December. (Before seasonal adjustment, gasoline prices rose 0.7 percent in December.) The fuel oil index also rose, increasing 2.4 percent in December. The electricity index rose 0.4 percent, its fourth consecutive increase. The only major energy component index to decline was the index for natural gas, which fell 0.4 percent, its third consecutive decrease.

 

All items less food and energy

 

The index for all items less food and energy rose 0.1 percent in December after a 0.2 percent advance in November. The shelter index rose 0.2 percent in December after a 0.3 percent increase in November. The rent index increased 0.3 percent, while the index for owners’ equivalent rent rose 0.2 percent. The index for lodging away from home fell 0.3 percent after rising in November. The apparel index rose 0.9 percent in December after declining in each of the three previous months. The tobacco index rose 0.6 percent and the personal care index increased 0.3 percent. The new vehicles index was unchanged in December, as was the medical care index. The index for medical care services rose 0.3 percent, but the index for medical care commodities fell 0.8 percent, as the prescription drugs index declined 0.9 percent. The airline fares index declined sharply in December, falling 4.7 percent after increasing in recent months. The indexes for recreation, for household furnishings and operations, and for used cars and trucks also fell in December.

But while the surge in gasoline prices was notable, despite the relentless din of empty CNBC chatterboxes pronouncing the plunge in gas prices, the biggest surprise was the collapse in prescrption drug prices, whichin December fell by the most on record. Thanks Obamacare!


    



via Zero Hedge http://ift.tt/1dyxhv0 Tyler Durden

A.M. Links: House Approves Trillion Dollar Spending Bill, LAPD Testing Body Cameras, 2013 Hot and Wet

  • kinda like 2013The House of Representatives overwhelmingly

    approved
    a 1,582-page, trillion dollar spending bill.
  • Computer security experts are
    warning
    the government that the Obamacare website is not
    protected from hackers.
  • The DEA’s chief of operations
    called
    state efforts to legalize marijuana “reckless and
    irresponsible.”
  • The LAPD is testing
    body cameras for 90 days with 30 cops who volunteered to wear
    them.
  • The IMF’s Christine Lagarde
    thinks
    this could be the year the global economy finally gets
    better.
  • The French ambassador to the UN
    explained
    his country had underestimated the level of hatred
    between Muslims and Christians before intervening in the Central
    African Republic.
  • 90 percent of Egyptians
    voted
    to approve the new constitution, in an election boycotted
    by the banned-again Muslim Brotherhood.
  • 2013 was a hotter and wetter than average year in the U.S.,

    according
    to government data.
  • Oscar nominations were announced
    this morning. 12 Years a Slave, Gravity, and American Hustle lead
    in nominations, while Jeremy Scahill’s documentary about U.S.
    covert warfare, Dirty Wars, also received a nomination. Maybe the
    First Lady will announce that winner this year?

Follow Reason and Reason 24/7 on
Twitter, and like us on Facebook.
  You
can also get the top stories mailed to
you—
sign
up here.
 

from Hit & Run http://ift.tt/1maMC79
via IFTTT

Continuing Claims Surge Most In Over 5 Years To 6-Month Highs.

Initial claims beat expectations very modestly (326k vs 328k expected) and hover at their average level of the last 6 months. Non-seasonally-adjusted saw initial claims surge to 438k. It would appear the trend of improving claims has ended for now. What is perhaps more worrying is the continuing claims surged by their most in over 5 years – at 3.03 million, this is the highest in 6 months (and the biggest miss in 6 months. It is worth noting that this is before the emergency benefits for 1.3 million Americans disappear (which will likely begin to show up next week or the week after).

 

 

This is the worst weekly shift in continuing claims since November 2008…


    



via Zero Hedge http://ift.tt/1maMDbr Tyler Durden

Best Buy Plummets 30%, Is Better Sell Following Abysmal Holiday Sales Update

Despite several apparently well respected sell-side shops proclaiming that all would be well, the electronics warehouse missed comps (Sales at stores open at least 14 months were down 0.9 percent in the US – compared to expectations of +2.0%) and is being punished. Revenues fell 2.6% for the comparable period also. Shares are down 30% in the pre-market to 7-month lows as the company claims an “intensely promotional holiday season.” It seems, perhaps, that following several other retailers’ earnings updates the holiday season was even worse than many had expected (especially in the brocks-and-mortar stores that actually employ real people).

 


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/h2gGSobl0ec/story01.htm Tyler Durden

COMEX Gold Stocks At Record Lows As SGE Volumes Surge 61%

Today’s AM fix was USD 1,237.25, EUR 908.61 and GBP 757.19 per ounce.
Yesterday’s AM fix was USD 1,238.00, EUR 908.56 and GBP 753.91 per ounce.

Gold fell $2.80 or 0.23% yesterday, closing at $1,240.60/oz. Silver slipped $0.04 or 0.2% closing at $20.15/oz.

Gold prices are marginally lower again today in most currencies. Gold is more than 1% higher in Australian dollars after a very poor jobs number in Australia raised concerns about Australian asset bubbles and the Australian economy. The Aussie dollar has fallen by 4.4% against gold so far this year.

Technically, gold is looking sounder. Support is at $1,220, $1,200 and of course what appears to be a double bottom at $1,180/oz. A close above $1,270 could see gold quickly move to test resistance at $1,300 and $1,330.


Portion of Registered Comex Gold Stocks at Record Low: Bloomberg Industries Chart

The supply demand fundamentals of the gold market remain sound with the flow of gold from West to East.

COMEX gold stocks have fallen to new record lows (see chart) showing demand for physical bullion remains very robust. Indeed, the scale of the fall in COMEX gold stocks since 2007 and which accelerated in early April 2013 is important to note.


Daily Shanghai Gold Exchange Volumes Surge 61% Yoy: Bloomberg Industries Chart

Conversely, on the Shanghai Gold Exchange (SGE), volumes surged in the year 2013, particularly since the peculiar, sudden price drop in April and volumes traded surged 61% year on year.

The London bullion market has seen intermittent shortages of 400 ounce gold bars. Traders said the shortage of London Good Delivery Bars was pushing premiums for physical delivery for 400 ounce bars as high as 50 cents.

Physical buyers view the 28% sharp sell off in 2013 as an opportunity. They continue to accumulate on prices below the $1,300 per ounce level.

Click Gold News For This Week’s Breaking Gold And Silver News
Click Gold and Silver Commentary For This Week’s Leading Gold And Silver Comment And Opinion
Like Our Facebook Page For Breaking News, Interesting Insights, Blogs, Prizes and Special Offers


    



via Zero Hedge http://ift.tt/19wCKkW GoldCore

Average Pay Of Goldman Banker Rises To $383,374 On Expectations Beat Despite Plunge In Order Flow

Yesterday Bank of America beat thanks to (among other things) ye olde “plunge in the effective tax rate” gimmick which let it beat EPS by two cents instead of missing by three. Today it was Goldman’s turn to “beat” lowered EPS expectations of $4.18, posting a substantial beat of $4.60. So did Goldman also fudge its tax rate? Not exactly: instead, what Goldman did was to reduce its compensation benefits from $2.4 billion to $2.2 billion, which meant the firm’s compensation margin declined from 35.2% to a tiny 24.9% of revenue. Had Goldman kept the comp margin flat it would have missed EPS by about 50 cents. However, unlike the other “banks” Goldman at least did post a notable beat in GAAP revenues (it was reluctant to use a non-GAAP top line, hear that Jamie?) as well, with Q4 sales rising from $6.7 billion in Q3 to $8.8 billion, on expectations of $7.8 billion. However, compared to a year ago, the top line was 5% lower, while Net Income of $4.60 was 21% lower than a year earlier.

The reason for the decline in revenue was the plunge in Equity and FICC Institutional Client Flow, both of which tumbled by 27% and 15% respectively year over year, as more and more institutions just say no to trading. Which mean that Goldman’s prop trading group had to pick up the slack and sure enough Investment and Lending, aka Prop, saw its revenue rise to $2.1 billion in the quarter, up 4.4% from a year ago and the third best quarter in post-Lehman history. Finally, Investment Banking revenues of $1.7 billion also posted a notable increase of 22.3% Y/Y as Goldman’s bankers rushed at the opportunity to advise on the surge in equity and debt offerings and occasional M&A deals.

Finally, even though Q4 comp benefits of $2.2 billion did decline from Q3, it was modestly higher than a year ago, which means that the average compensation per average Goldman banker rose modestly to $383,374. Remember, though: there is no such thing as an “average” Goldman banker.


    



via Zero Hedge http://ift.tt/19wCK4F Tyler Durden

Frontrunning: January 16

  • Charter, Comcast in renewed talks on Time Warner Cable bid (Reuters)
  • Bankers’ Stock Awards Jet Higher (WSJ)
  • Yahoo CEO Mayer Dismisses Operating Chief De Castro (BBG)
  • Amazon Employees Vote to Reject Union (Reuters)
  • Luxury in China loses luster as wealthy flee (Reuters)
  • UnitedHealth Profit Up on Stronger Enrollments (WSJ)
  • U.S. government failed to secure Obamacare site: experts (Reuters)
  • Spain Sells Bonds at Record-Low Yield as Rajoy Touts Rebound (BBG)
  • Newport Beach’s $100,000 Lifeguards Feel Pension Squeeze (BBG)
  • Bailed-Out Euro Nations Expect Painful Challenges to Remain (BBG)
  • Two Weeks Into Health Law’s Rollout, Few Problems, Few Patients (WSJ)
  • Currency Traders Told Bank of England of Fix Practices in 2012 (BBG)
  • Apollo to buy Owner of Chuck E. Cheese’s for $950 Million (WSJ)
  • Europe Car Sales Surge Most in Four Years on Lower Prices (BBG)
  • U.K. Home-Price Index Near 2002 High as Carney Sees Strength (BBG)

 

Overnight Media Digest

WSJ

* Yahoo Inc CEO Marissa Mayer is parting ways with her top executive, a setback in her effort to turn around the struggling Internet portal. Henrique de Castro, the chief operating officer poached from Google Inc in 2012, is departing this week.

* Former General Motors Co chief executive Dan Akerson said his successor, Mary Barra, faces tough challenges as she takes the helm as the first woman to lead a global automotive company.

* The National Labor Relations Board on Wednesday accused Wal-Mart Stores Inc of unlawfully retaliating against or threatening workers who took part in strikes and protests in more than a dozen states in the last two years.

* Apple Inc on Wednesday settled a complaint by the Federal Trade Commission alleging the technology giant didn’t do enough to prevent children from making purchases on mobile apps without their parents’ consent.

* AOL Inc has reached a deal to sell a majority stake in its Patch local news network to Hale Global, an investment firm specializing in turnaround situations.

* J.C. Penney Co is planning to close 33 underperforming stores and trim 2,000 positions, moves the department-store retailer said are necessary so it can focus on locations that can generate the strongest profits.

* Goldman Sachs Group Inc employees are sitting on more than $600 million in extra bonus money, for the past year alone, thanks to the bank’s surging stock price. The paper windfall is based on calculations of the rise in value of stock the employees were awarded in their pay packages.

* A federal judge on Wednesday upheld the legality of subsidies at the core of the federal health-care law, turning aside one of the principal remaining court challenges to the law.

 

FT

Yahoo Inc Chief Operating Officer Henrique de Castro, the high-profile executive Chief Executive Officer Marissa Mayer brought in as part of her turn around strategy, will be leaving on Thursday after about a year on the job.

J C Penney Co Inc said on Wednesday it will close 33 underperforming stores across the United States and cut 2,000 jobs as part of the struggling retailer’s ongoing turnaround efforts.

Apple Inc will pay tens of millions of dollars as compensation to settle a longstanding complaint with the U.S. Federal Trade Commission that the technology company billed U.S. consumers whose children bought upgrades in apps and games on their iPhones and iPads without their parents’ consent.

General Motors Co said it would incur more than double the restructuring costs it has in recent years with the withdrawal of the Chevrolet brand in Europe and the impending closure of a plant in Germany.

Deutsche Bank, Germany’s biggest bank, has suspended several middle-ranking currency traders in an internal probe further intensifying an international investigation into the manipulation of foreign exchange markets, people close to the situation said.

AOL Inc is handing majority ownership of Patch, a network of local news websites, to New York investment firm and turn around specialist Hale Global, offloading an underperforming asset that has long been a hurdle for the Internet company in its turnround efforts.

 

NYT

* Lawmakers pressed the Federal Reserve to act more forcefully, and quickly, to limit banks’ involvement in the commodities business, which has been blamed for inflating prices on everyday items like electricity and canned beverages. The Federal Reserve had said on Tuesday it was considering some new rules and issued a request for public comment.

* After spiraling higher for much of the last decade, the value of federal contracts fell by $58 billion, or roughly 11 percent. It was the steepest decline – in percentage and nominal terms – in at least a decade, according to an analysis of federal contract data by The New York Times.

* Yahoo’s No. 2 executive, Henrique de Castro, has been fired by his boss, Marissa Mayer, a little more than a year after she wooed him away from Google to help her turn around the struggling Internet company.

* Citigroup plans to reissue all customer debit cards involved in the data breach at Target. Citi said its decision this week was not motivated by any new surge of fraud or by additional information on the breach but was a precautionary measure.

* The Carlyle Group has almost clinched a deal to buy Johnson & Johnson’s clinical testing arm for about $4.1 billion after several weeks of negotiations, a person briefed on the matter said on Wednesday.

* J.C. Penney Company said it would close 33 stores across the country and shed about 2,000 jobs. The company said in a statement that the closings and resulting job cuts would save about $65 million a year.

* The Federal Trade Commission said Apple Inc had agreed to better ensure parental approval of purchases from the company’s App Store. In addition, Apple will pay at least $32.5 million in refunds to customers whose children made purchases without adequate parental consent.

* The National Labor Relations Board, in a sweeping complaint, said that Walmart illegally disciplined and fired employees after strikes and protests for better pay.

* In the first unionization vote ever held at an Amazon facility in the United States, a small group of technical workers at the company’s warehouse in Middletown, Delaware, voted overwhelmingly against forming a union.

 

Canada

THE GLOBE AND MAIL

* Kinross Gold Corp, dogged by protests and controversy after dismissing nearly 300 workers at its Mauritania gold mine, insisted that the layoffs will help safeguard its future at one of its highest-cost operations.

* Ottawa and the provinces are inching toward a deal on the Canada Job Grant as provincial labor ministers plan to talk on Friday about the latest offer from the federal government.

Reports in the business section:

* Sears Canada Inc, controlled by Sears Holdings Corp, is cutting another 1,628 jobs after having reduced its workforce last year by almost the same number as the retailer tries to bolster its struggling operations.

NATIONAL POST

* Canada’s ambassador to the United States has raised the prospect of retaliation against “discriminatory” Buy American provisions that are included in a new spending bill in Congress.

* A teenager who was allowed to fly after trying to get a pipe bomb through security at Edmonton International Airport refused when the screeners tried to give the device back to him, the Edmonton Journal reported. Transport Minister Lisa Raitt slammed officials with the Canadian Air Transport Security Authority after it was learned that they allowed Skylar Murphy to board his flight and didn’t call the RCMP until four days later.

FINANCIAL POST

* Canada’s Privacy Commissioner says search engine giant Google Inc violated Canadian privacy statutes by using the sensitive information of Canadians’ in order to target users with health-related advertisements.

 

China

CHINA SECURITIES JOURNAL

– Tianhong Asset Management Co, controlled by China’s Alibaba, has overtaken China Asset Management Co as China’s biggest fund house by assets.

SHANGHAI SECURITIES NEWS

– LeTV, one of the biggest online video providers in China, launched its 70-inch “super TV” priced at 6999 yuan ($1,200) on Wednesday.

CHINA DAILY

– Health authorities say the number of confirmed cases of H7N9 bird flu cases continues to rise nationwide, with 20 new cases in the first two weeks of 2014.

– Chinese officials rejected Tokyo’s characterization of its aid to Africa and said Japan’s plan to increase aid won’t help the continent.

SHANGHAI DAILY

– Shanghai will implement a new colour-coded warning system for air pollution and will shut schools and order cars off the road in case of a recurrence of the severe smog that has plagued the city in recent months.

CHINA NATIONAL RADIO

– China Wafer Level CSP Co Ltd delayed its IPO, according to company announcement published on Wednesday.

PEOPLE’S DAILY

– The fundamental way to select qualified government official is to build a scientific and effective system, said a editorial in the paper that acts as the Party’s mouthpiece.

 

Britain

he Telegraph

MARK CARNEY REJECTS ED MILIBAND’S BANK SHAKE-UP PLAN

The Governor of the Bank of England has rejected Ed Miliband’s plans to shake up the UK banking industry. In a blow to the Opposition leader’s attempt to appear tough on big business, Mark Carney dismissed plans to break up the UK’s biggest banks and questioned whether caps on bonuses were the right to way control pay.

HECTOR SANTS LINED UP TO LEAD CHURCH OF ENGLAND TASKFORCE

Sir Hector Sants, who resigned from his role at Barclays just two months ago due to stress and exhaustion, is being lined up by the Archbishop of Canterbury with a view to drive payday lenders such as Wonga out of business and create a new way of thinking about finance.

The Guardian

BANK OF AMERICA PROFIT BEATS FORECAST AS MORTGAGE LOSSES EASE

Bank of America Corp, the No. 2 U.S. bank, reported a stronger-than-expected quarterly profit, driven by a steep fall in mortgage losses and provisions to cover bad loans.

EU MOVES TO CURB FOOD PRICE BETS BY TRADERS

The European Union has voted through rules to limit the ability of banks and hedge funds to bet on food prices. Arlene McCarthy, a Labour MEP for the north-west, said the new rules, known as Mifid, would “curb speculation and help decrease price volatility and inflation” which had a “devastating impact on poor and food dependent countries”.

The Times

FOREX INQUIRY GATHERS PACE AS U.S. INVESTIGATORS FLY IN

America has stepped up its investigation into the market-rigging scandal engulfing the banking sector by sending a team to London to question bankers over the alleged manipulation of foreign exchange benchmarks.

HOUSE PRICES ‘WILL RISE FOR TWO MORE YEARS’

The Bank of England expects house prices to rise by about 10 percent over the next two years before the market cools. Although the Bank does not publish its housing projections, Mark Carney, the Governor, revealed to MPs on the Treasury Select Committee that it expected prices to continue rising at their present pace until late next year, before moderating in 2016.

The Independent

BURBERRY SHARES JUMP 6 PCT AS BRITISH LUXURY RETAILER SEES STRONG GROWTH IN CHINA

Burberry shares jumped more than 6 percent as the 158 year old British luxury brand posted 14 percent rise in third quarter sales with Chinese sales growth back in double digits, allaying fears that the region is experiencing difficulties.

TAYLOR WIMPEY BOSS PETE REDFERN WARNS AGAINST ‘HELP TO BUY’ EXTENSION

Taylor Wimpey chief Pete Redfern has warned against any long-term extension to the Government’s Help to Buy scheme, currently fattening sales and profits across the housebuilding sector.

 

 

FLy On The Wall 7:00 AM Market Snapshot

ECONOMIC REPORTS

Domestic economic reports scheduled for today include:

Week of January 11 Jobless Claims will be reported at 8:30–Current consensus is 327K
Consumer Price Index for December will be reported at 8:30–Current consensus is 0.3%
Philadelphia Fed Survey for January will be reported at 10:00–Current consensus is 8.7
Housing Market Index for January will be reported at 10:00–Current consensus is 57.5

ANALYST RESEARCH

Upgrades

Big Lots (BIG) upgraded to Market Perform from Underperform at Raymond James
Casey’s (CASY) upgraded to Outperform from Market Perform at Raymond James
Emulex (ELX) upgraded to Buy from Neutral at BofA/Merrill
Esterline (ESL) upgraded to Buy from Neutral at UBS
Gartner (IT) upgraded to Buy from Neutral at Goldman
HP (HPQ) upgraded to Buy from Neutral at BofA/Merrill
Micron (MU) upgraded to Outperform from Market Perform at JMP Securities
NetSuite (N) upgraded to Outperform from Market Perform at FBR Capital
Nielsen (NLSN) upgraded to Buy from Neutral at Goldman
NuVasive (NUVA) upgraded to Neutral from Sell at Goldman
Tetra Tech (TTEK) upgraded to Buy from Hold at KeyBanc
Trinity Industries (TRN) upgraded to Buy from Hold at Stifel
VMware (VMW) upgraded to Buy from Neutral at Citigroup
Verint Systems (VRNT) upgraded to Outperform from Market Perform at FBR Capital
Western Digital (WDC) upgraded to Buy from Neutral at BofA/Merrill

Downgrades

AECOM Technology (ACM) downgraded to Hold from Buy at KeyBanc
Alcatel-Lucent (ALU) downgraded to Equal Weight from Overweight at Evercore
BRF Brasil Foods (BRFS) downgraded to Neutral from Buy at Goldman
CSX (CSX) downgraded to Hold from Buy at Stifel
Dominion (D) downgraded to Hold from Buy at Jefferies
Eaton Vance (EV) downgraded to Sell from Neutral at Citigroup
Equifax (EFX) downgraded to Neutral from Buy at Goldman
Family Dollar (FDO) downgraded to Underperform from Market Perform at Raymond James
Forum Energy (FET) downgraded to Neutral from Outperform at Credit Suisse
Generac (GNRC) downgraded to Perform from Outperform at Oppenheimer
Kroger (KR) downgraded to Neutral from Outperform at Credit Suisse
MRC Global (MRC) downgraded to Underperform from Buy at BofA/Merrill
McCormick (MKC) downgraded to Hold from Buy at Jefferies
McGraw Hill Financial (MHFI) downgraded to Neutral from Buy at Goldman
Norfolk Southern (NSC) downgraded to Hold from Buy at Stifel

Initiations

FireEye (FEYE) initiated with an Outperform at William Blair
Marlin Business (MRLN) coverage resumed with an Outperform at JMP Securities
Philip Morris (PM) initiated with a Neutral at Exane BNP Paribas
Proofpoint (PFPT) initiated with an Outperform at William Blair
SolarCity (SCTY) initiated with a Buy at Deutsche Bank
SunPower (SPWR) initiated with an Overweight at JPMorgan
Telecom Italia (TI) initiated with a Hold at Jefferies

HOT STOCKS

CEC Entertainment (CEC) agreed to be acquired by Apollo (APO) affiliate for $54 per share
J.C. Penney (JCP) to close 33 stores, cut 2,000 jobs, sees annual savings of $65M
Citigroup (C) sold $10.3B worth of mortgage servicing rights (FNMA)
AOL (AOL) to partner with Hale Global on JV to pursue $152B local media market
Lease Corporation, KKR Financial (KFN, KKR) announced $100M strategic investment in LCIH
Sarepta (SRPT) said eteplirsen demonstrates continued stability in walking test
Amarin (AMRN) announced FDA review division response on SPA request will be delayed

EARNINGS

Companies that beat consensus earnings expectations last night and today include:
UnitedHealth (UNH), Huntington Bancshares (HBAN), BB&T (BBT), BlackRock (BLK), Boston Private Financial (BPFH)

Companies that missed consensus earnings expectations include:
Clarcor (CLC), MB Financial (MBFI), H.B. Fuller (FUL), El Paso Pipeline (EPB), Kinder Morgan (KMI), CSX (CSX)

Companies that matched consensus earnings expectations include:
BankMutual (BKMU)

NEWSPAPERS/WEBSITES

Charter (CHTR), Comcast (CMCSA) renew talks on Time Warner Cable (TWC) bid, Reuters reports
Actavis (ACT) CEO says quitting China business, Bloomberg reports
Marvell (MRVL) Technology: Not in buyout talks with KKR (KKR), Reuters reports
Citigroup (C) replacing debit cards in Target (TGT) breach, Reuters reports
eBay (EBAY) said to plan brand marketplace, WSJ reports
Microsoft (MSFT) CEO search includes Ericsson’s (ERIC) Vestberg, Bloomberg reports
Yahoo (YHOO) COO clashed with CEO Mayer, WSJ reports
Ford’s (F) aluminum efforts unsettles steelmakers, FT reports
Microsoft’s (MSFT) corporate email breached by Syrian hackers, Re/code reports
AT&T (T) cuts advertising ties with ‘American Idol’ (FOXA), Variety reports

SYNDICATE

Altisource Residential (RESI) 14.2M share Secondary priced at $34.00
American Capital Senior Floating (ACFS) 10M share IPO priced at $15.00
CorEnergy (CORR) 6.5M share Secondary priced at $6.50
GasLog (GLOG) to offer 8.4M shares of common stock, $30M private placement
JinkoSolar (JKS) 2.75M share Secondary priced at $35.25
Orchid Island Capital (ORC) files to sell 1.5M shares of common stock


    



via Zero Hedge http://ift.tt/1gPAO6w Tyler Durden