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tricouri funny
WASHINGTON (Reuters) - In the opening NAFTA session of talks, the United States did not give precise details of how much it wanted to boost North American content for autos, a source directly familiar with the negotiations said on Saturday.

WASHINGTON (AP) -- Billionaire investor Carl Icahn, who resigned Friday from an unpaid post as President Donald Trump's adviser on deregulation efforts, stepped down as The New Yorker was preparing to publish a lengthy article detailing Icahn's potential conflicts of interest and questioning the legality of his actions....

MEXICO CITY (AP) -- Mexican authorities say an explosion at an illegal fuel pipeline tap has killed a person and injured five more in the Gulf coast state of Veracruz....

Anti-immigrant sentiment is on the rise across the US and Europe. 

In the US, President Donald Trump has unveiled legislation intended to limit immigration to only high-skill workers. And the percentage of immigrants in the US is near an all-time high at 13.5%, according to nonpartisan think tank Migration Policy Institute. But the number of immigrants living in the US is nowhere near as high as people think it is, according to a chart by Deutsche Bank using data from the OECD, the intergovernmental development organization. In fact, it is nearly a third of what people think it is. 

The below chart shows the actual and perceived number of immigrants in nine countries. 

The US isn't the only nation where the immigrant population is lower than what people perceive it to be. Take a look:

Screen Shot 2017 08 15 at 11.19.20 AM

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Tech group loses traction in world’s biggest phone market as users shift to rivals

john venhuizen

Retail is in peril, and Amazon is a big reason why.

But home improvement stores have enjoyed some protection from Amazon's encroachment into virtually every sector. They're sometimes described as being Amazon-proof in the media. 

"I would never use the word 'proof,'" said John Venhuizen, the CEO of Ace Hardware.

Amazon is "quite arguably the most disruptive company in the history of business and they impact everybody without question," Venhuizen told Business Insider.

That Amazon can lose money to help its customers and still hold Wall Street's support is "terrifying," he said. Amazon last month forecast its first quarterly loss in two years. 

Investors have sent Amazon's stock up 31% this year, compared to a 10% gain for the S&P 500. The US iShares home construction exchange-traded fund, which includes major players like Home Depot and Lowe's, is also surging, up 26% year-to-date. 

But home-improvement retailers won't enjoy endless favor from Wall Street. Take Home Depot, for example, which fell 3% on Tuesday even after smashing analysts' expectations and raising its guidance for the second time this year. Ace Hardware is privately held and run as thousands of independent stores.

Home Depot shares also fell after Sears announced it planned to start selling its Kenmore-branded appliances on Amazon, and was launching a line of appliances that can be voice controlled with Amazon Alexa.

Longer-term, however, stores like Home Depot and Ace Hardware have three key attributes that can protect their market share from e-commerce giants: what they sell, service, and location.

The nature of the products they sell lends itself to human interaction. Buyers still want to ask a person how things work, or how to mix paint, or which colors to select in the first place.  

And the more exceptional the service, the better. "When a local business provides an irrational level of service to their local neighbors, that's hard to compete with on a big-box or a dotcom national scale," Venhuizen said. "Every small business can do that."

Although free shipping is convenient, having thousands of stores near the neighborhoods that customers live in is also a big advantage, Venhuizen said.

Ace Hardware, like other hardware retailers, has billions of dollars worth of inventory sitting in its stores across the country. One way to exploit that is by promoting online pick-ups (online orders that are picked up at a store), essentially blending online and offline strategies.

Venhuizen said Ace Hardware's online sales grew 61% in the second quarter. 93% of those transactions were picked up in the store. The company is starting to experiment with home delivery, he added. 

"Many people like to still physically see and touch and have the five senses," Venhuizen said. "We had a big 5,000-store celebration [this weekend]. Many of them were out there smoking meat on a grill. You can't smell that on Amazon."

SEE ALSO: Several CEOs are voicing the same complaint about one of Trump's biggest brags

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19:03 Tech 'unicorn' IPOs are booming (Business Insider)

Highly-valued tech startups are going public at a pace not seen in three years.

Four so-called "unicorns," or private companies valued at $1 billion or higher, completed initial public offerings in the second quarter. That was double what was seen in the first quarter, and equal to the number of unicorn IPOs for the entire year in both 2015 and 2016, according to data compiled by Goldman Sachs.

Screen Shot 2017 08 15 at 9.22.11 AM

These IPOs have seen mixed success. Here's a breakdown of the four former unicorns that made it to market in the second quarter, with all valuation data from Goldman:

  • Okta — Completed IPO in April, valued at $1.8 billion, above its last funding round, which put it at $1.2 billion
    • Stock has surged 42% since pricing
  • ClouderaCompleted IPO in April, valued at $1.9 billion, well below its last funding round, which implied a $4.1 billion valuation
    • Stock has climbed 19% since pricing
  • Delivery Hero — Completed IPO in June, valued at €4.4 billion, above its last rounding round, which put it at €3.1 billion
    • Stock has risen 6.6% since pricing
  • Blue Apron — Completed IPO in June, valued at $1.9 billion, slightly below its last funding round, which implied a $2 billion valuation
    • Stock has plummeted 46% since pricing

It's worth noting that while Blue Apron's final valuation doesn't look particularly weak relative to its last private funding round, the company had a hellacious time going public.

In the weeks leading up to Blue Apron's final pricing, retail juggernaut Amazon shelled out $13.7 billion to buy Whole Foods, which caused potential investors to consider the possibility of more competition in the food-delivery industry. As a result, Blue Apron took a cleaver to its IPO range, cutting it to $10 to $11 a share, down from $15 to $17. The company ultimately priced at $10 a share — 40% below the maximum it had sought.

The ordeal serves as a cautionary tale for other unicorns which may be considering a public offering. It shows that industries of all types can prove fickle to external pressures, and stresses just how important it is for companies to exercise caution when trying to time their IPOs.

So what's next for the growing unicorn universe? After all, 13 new ones emerged during the second quarter, more than offsetting the four that went public. There are now 168 unicorns out there.

The biggest single funding round for a software and internet company in the second quarter was a $400 million Series E for Houzz, a popular photo site used by homeowners to plan renovations. Other companies receiving considerable late-stage funding included Peloton ($325 million) and AvidXchange ($300 million), according to Goldman.

The number of unicorns has either increased or stayed flat in ever quarter since the start of 2014, the firm's data show. Here's a look at their trend over time:

Screen Shot 2017 08 15 at 9.54.00 AM

SEE ALSO: 3 key charts show just how fragile stocks are right now

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Marty Chavez

  • Goldman Sachs has hired a top Silicon Valley executive to help attract tech talent.
  • Wall Street firms are digitizing their offerings and are competing with tech giants for engineering talent.

Goldman Sachs is bringing on a Silicon Valley-insider to lure tech talent.

The investment bank has hired Andrew Tout from Square, a San Francisco-based financial technology company, to help fill the bank with top engineering talent, according to Bloomberg. Tout will be joining the bank to fill a new position tasked with leading engineering recruitment. 

Goldman Sachs has been on a hiring spree to become the Google of Wall Street. Specifically, the investment bank is staffing up Marquee, its platform that provides clients access to the bank's analytics, data, content via a browser of an API.

One ad posted in mid-July said the bank is "looking for creative and talented engineers to build out our next generation client facing risk and execution platforms."

In addition to hiring Tout, Goldman has raised the pay for programmers fresh out of college to lure them away from the Valley, according to Bloomberg. 

"Prior to the changes, a beginning engineer in New York could expect to make a base salary of about $83,000, with a bonus of about $12,000," according to Bloomberg. "That would probably climb to more than $100,000, with a larger bonus under the new policy."

Tiffany Galvin, a Goldman Sachs spokeswoman, told Business Insider the firm is focused "on attracting top tech talent."

Attracting talent away from the Valley will not be an easy feat, according to one Silicon Valley veteran. 

Goldman and other top banks have struggled to compete with tech firms, which offer more flexible hours and better perks such as casual dress codes and fridges stocked with beer. 

Tien Tzuo, CEO of Zuora, a software firm, told Business Insider Wall Street's problem won't be easy to overcome. He thinks even if firms like Goldman Sachs try to mimic tech culture, tech firms will have the upper hand in attracting talent. 

"If you are a rock star programmer, you want to come to Silicon Valley and change the world, not use your talents to help bankers make more money," Tzuo said. 

SEE ALSO: Young Wall Streeters were surveyed about their experiences in finance — and their responses were brutal

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Chief strategist’s departure is opening shot in battle for the soul of the presidency

Dannon light and fit yogurt

Activist hedge fund Corvex Management is loading up on shares of Danone, the $53 billion French conglomerate that sells yogurts like YoCrunch and Activia as well as Evian bottled water.

Corvex recently bought a $400 million stake in Danone — known in the US for its Dannon subsidiary — claiming weak sales and stock performance of late have led investors to undervalue the firm, according to a Bloomberg report.

Danone stock was up more than 4% through mid-afternoon Monday. 

Corvex, which is run by Carl Icahn protegé Keith Meister, isn't the only activist targeting European brands. 

Third Point Capital, which is run by billionaire investor Dan Loeb, recently revealed a $3.5 billion position in Swiss food and beverage company Nestle.

So far, neither Meister nor Loeb are making aggressive moves to rankle their new European targets.

Loeb has heaped praise upon Nestle CEO Mark Schneider, and Bloomberg reports that Meister has no plans to start a public battle over Danone's management.

Read the full Bloomberg report here

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PARIS (AP) -- A report that a cooperating witness has emerged out of Ukraine to help the FBI's inquiry into the 2016 hacking of the Democratic National Committee is drawing confusion and denials in Ukraine....

18:02 Stocks are looking unstoppable (Business Insider)

Superman Warner Bros

The US stock market simply will not be defeated.

Just two sessions after the S&P 500 tumbled 1.5%, its biggest decline since May, the benchmark ended Monday back within half a percent of its level before the North Korea-fueled sell-off.

The S&P 500 edged an additional 0.1% higher on Tuesday.

But why? Nothing particularly bullish is happening in the earnings world, and no overtly bullish economic data has been released.

One explanation is that traders have simply pushed aside their worry over possible military action between the US and North Korea and are using last week's weakness as an attractive entry point for more stock buying.

If that reasoning sounds familiar, that's because it's happened throughout the eight-year equity bull market, which is now well into its tenure as the second-longest on record.

Stock traders seem fully aware that brief sell-offs in the past several years have simply been head fakes, and they are treating them as nothing to worry about. In fact, their willingness to apply that logic may even be helping fuel the trend further.

Screen Shot 2017 08 14 at 4.25.54 PM

"Last week's action was more investors taking advantage of news that justified some profit taking, rotation and rebalancing rather than a market rout or harbinger of worse things to come," John Stoltzfus, the chief investment strategist at Oppenheimer, wrote in a client note. "While markets may be rattled by spikes in tensions between nations and even war, the unsettling periods for the bourses around these occurrences tend to be short in duration and with fleeting effect."

For evidence of how quick US equity investors are to buy the dip, look no further than the S&P 500's 1.8% single-day decline in May. The index recovered 85% of that loss over the following three days, the second-fastest retracement of a loss that big in S&P 500 history, according to data compiled by Bank of America Merrill Lynch.

Going further back in time, after the S&P 500 fell by 5.3% over two trading sessions following the UK's vote last June to leave the European Union, the benchmark recovered those losses in about a week.

The same dynamic was in play when China unexpectedly devalued its currency in August 2015. After the S&P 500 underwent an 11% correction, traders bought the dip and restored the benchmark to its pre-sell-off levels within about two months.

Torrid earnings growth for S&P 500 corporations is at the root of stock investor confidence right now. Companies in the benchmark index are on pace to expand profits by 10.7% in the second quarter, which would mark its fourth straight period of expansion, according to survey data compiled by Bloomberg. The S&P 500 is expected to grow earnings by 11.2% in 2017, its best full-year performance since 2010, the survey shows.

So what will finally serve as the tipping point for US equities? No one knows, but keep a close eye on the CBOE Volatility Index, or VIX, which serves as a measure of stock market fear. The gauge — which trades opposite the S&P 500 roughly 80% of the time — spiked 44% on Thursday but has since pared that gain.

While that price action in the VIX isn't particularly worrisome to Allianz chief economic adviser Mohamed El-Erian, he's not ruling out more price swings if the ongoing geopolitical griping escalates further.

"The market's buy-on-dips conditioning is strong," El-Erian told Business Insider. "As such, it would take a worsening of the North Korean tensions to amplify the pressures on the VIX."

SEE ALSO: Escalating North Korea tensions were 'a match to light the fire' — now markets are at a crucial crossroads

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Five Moroccans arrested and Interpol search warrant issued for sixth 

Solar Eclipse on Snap Map

Snapchat spent $213 million to acquire Zenly, the French mapping app that powers the recently announced Snap Map feature.

Snap Map allows you to see where your Snapchat friends on a map of the world. Friends are displayed using their Bitmoji avatars, which comes from another Snap acquisition.

To celebrate Monday's upcoming solar eclipse, Snapchat is creating what it calls the first-ever "Actionmoji" tied to a moving event. The bitmoji of Snapchat friends who are in the path of the eclipse's "totality" will temporarily be depicted wearing solar glasses and looking up into the sky.

Users will also be able to tap on areas of the map to see crowdsourced videos related to the eclipse. Snapchat's editors will use the videos to create an "Our Story" about the event and include videos submitted by NASA and the Department of Interior.

The feature may seem like a fun, one-off novelty to capitalize on the eclipse. But the eclipse "Actionmoji" really shows how Snap is thinking about customizing Snap Map around specific events. The company could eventually create similar experiences for sponsored events, like concerts or sports games.

SEE ALSO: Snap confirms that it paid $213 million to buy Zenly and $135 million for Placed

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NOW WATCH: RICH GREENFIELD: There is just one way for Snapchat to survive Facebook


Home Depot, America's largest home-improvement store, is counting on millennials to extend the US housing recovery.

The US homeownership rate for people under 35 still trails other age groups for reasons including delayed marriage and record student debt. According to the Census Bureau, 35.3% of people in this age bracket owned homes in the second quarter, up from 34.1% a year ago.  

Home Depot noticed this uptick in the increase of first-time homebuyers that visited its stores for supplies. Carol Tome, Home Depot's chief financial officer, said the company served 424,000 first-time homebuyers in the second quarter, the highest since 2005 and an 11% increase from a year ago. This group made up 38% of all buyers, Tome told analysts during the quarterly earnings call on Tuesday.

She continued: 

"So that is good news. Why? Because first-time homebuyers tend to buy homes that need repair and remodel ... we anticipated this happening with millennials coming into an age where they start to form families, children, or pets or whatever their family unit might look like. They're moving into homes, which bodes very well for us and to your point, it extends the recovery."

Higher home ownership was just one reason why Home Depot reported another strong quarter. Home Depot also benefited from rising home prices caused by a shortage of non-luxury houses relative to the demand.

Tome's comments are "consistent with our view that pent up entry-level demand along with moderately increasing supply should provide for housing expansion over the next several years," said Susan Maklari and Christie Fredericks, analysts at Credit Suisse, in a note Wednesday.

"Low levels of for-sale inventory are creating an environment for accelerated home price appreciation, likely to spur incremental repair and remodel activity going forward," the note added.

Home Depot stands to continue benefitting from rising home prices and greater homeownership. But for more millennials to find houses they can afford, construction needs to pick up. 

"As more and more millennials age into household formation, the pace of housing starts will need to not only meet but exceed the growth in new households so that the housing inventory shortage doesn't increase further," said Mark Fleming, the chief economist at First American, in a note on Wednesday.

Builders have cited land shortages and rising building-material costs as reasons for the supply shortage.

"More home building is needed, otherwise nominal home prices will only go one way up," Fleming said.

SEE ALSO: ACE HARDWARE CEO: I'd never say we're Amazon proof, but here are 3 ways we can survive the retail apocalypse

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Schonfeld Strategic Advisors' chief investment officer, Ryan Tolkin, used to work at Goldman Sachs and explains how the bank is different from working at a hedge fund. Following is a transcript of the video.

The biggest thing is obviously the size of the firm and at Goldman you are, sort of, a cog in a much bigger wheel. And so, while you can make some very important decisions, ultimately, each of those decisions has less of an impact on the success of the overall firm. 

When you're working at a smaller place each decision contributes to the bottom line in a much greater fashion. And so I would say the importance of each decision is much more at a smaller firm than at Goldman. Generally speaking, there's more politics involved at working at a bigger place and you need to think about some of those politics as you maneuver your career through a bigger bank like Goldman where as at a smaller firm, we've tried to create a culture that lacks politics.









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Profits of Alibaba, Tencent and Baidu keep surging but they are vulnerable


Banks are scaling back on lending to Americans with the lowest credit scores, according to a study from TransUnion

Lenders processed fewer new personal loans, auto loans, and credit cards for subprime borrowers year-on-year in Q2 for the first time since 2012.

Lenders tightened their standards after the housing crisis a decade ago following several years of reckless lending to subprime borrowers. As the economy rebounded, they opened up access to the subprime part of the market. This new study shows that the trend is turning again.

But now is not a comparable time period to the financial crisis, said Ezra Becker, the senior vice president of research and consulting at TransUnion.

It would be alarming and a sign of another credit downturn if lenders pulled back on their underwriting and delinquencies still continued rising, Becker said. "Delinquency levels are still far below historical norms," he told Business Insider.

This pullback "is a great illustration of the kind of job lenders do on a regular basis to evaluate their portfolios, take a look at their risks and opportunities, and find and maintain that balance point." 

Additionally, missed payments on subprime auto loans started to rise, and so the natural response was to pare lending in that segment. 

Just like it doesn't signal economic trouble, this change in the trend is not a reason for people with lower credit scores to be more concerned, Becker said. "Subprime consumers are always in recession," he said. "And in fact, when recession hits the economy more broadly, they actually don't see delinquency rates rise all that much because in the subprime space, they are already high."

His guidance to subprime consumers was to strive to make their minimum payments every month, and not hesitate to let lenders know once they suspect there would be trouble paying.

The same goes for people with higher credit scores. "There's never a time when consumers should not be aware of their credit scores and what drives those credit scores," Becker said. 

SEE ALSO: Millennials are finally buying homes and it means ‘pent up demand’ could last for years

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Bank of America

Bank of America is stepping up its game in the travel rewards credit card competition, revealing its new Premium Rewards card, which will launch in September, the Wall Street Journal reported this week. 

The bank, the second-largest in the US by assets, has largely avoided the fierce battle for young, affluent credit card holders that has raged the past year since JPMorgan Chase unveiled its heralded Sapphire Reserve card.

Since the Sapphire Reserve's release last August, other competitors like American Express and Citi have tweaked their upper echelon reward card offerings to compete — even as the early returns suggest Chase may be struggling to make money off its blockbuster card so far. 

The pitfall of offering such lucrative rewards — Chase was handing out 100,000-point sign up bonuses before it slashed that down to 50,000 earlier this year — is it's tough to make money if customers stick around only long enough to reap the bonuses. Churners don't make for good business.

All the perks of the Premium Rewards card haven't been revealed yet, but like its competitors, it will offer a travel credit — $100 for airline expenses, excluding airfare — as well as $100 toward TSA PreCheck or Global Entry, a Bank of America spokesman told Business Insider. 

So how is Bank of America distinguishing its card? For starters, it will have a lower bonus, lower minimum-spending threshold to earn that bonus, and lower annual fee. 

But perhaps more importantly, the points cardholders will earn directly correspond with how much money they have at the bank, rewarding those enrolled in their Preferred Rewards program who have deeper ties and are less likely to cut and run. 

BI Intelligence's Jaime Toplin explains

"At its base, consumers get two rewards points for travel and dining, and 1.5 for everything else — a platform similar to 'mass-market' cards, according to the WSJ. But the firm also has a tiered system in place, where consumers with active BofA accounts can get higher rewards based on their account balances, with totals of up to 3.5 and 2.6 points, respectively, available to consumers. This system could help the card attract and incentivize lucrative customers without sacrificing mass appeal, ultimately broadening its user base."

Here's a look at how Bank of America's new card compares with the Sapphire Reserve and other competitors in the premium credit card rewards space.

Note: Card benefits listed are not exhaustive 

This article has been updated from its original version.

1. Bank of America Premium Rewards

Annual fee: $95

Sign-up bonus: 50,000 points

Spending required for sign-up bonus: $3,000

Points per dollar spent (tiered system based on how much cash you have deposited or invested with the bank):

• 2 for travel/dining, 1.5 for all other purchase (Less than $20,000 deposited)

• 2.5 for travel/dining and 1.875 on all other purchases ($20,000 to 49,999 deposited)

• 3 for travel/dining and 2.25 on all other purchases ($50,000 to 99,999 deposited)

• 3.5 for travel/dining and 2.6 on all other purchases (More than $100,000 deposited)

Other perks:

• $100 travel credit for airline travel expenses (like baggage fees; doesn't include airfare)

• $100 application credit for Global Entry/TSA PreCheck

This slide has been updated from it's original version. 

Chase Sapphire Reserve

Annual fee: $450

Sign-up bonus: 50,000 points

Spending required for sign-up bonus: $4,000

Points per dollar spent:

• 3 for travel/dining, 1 for all other purchase 

Other perks:

• $300 credit for travel expenses

• $100 application credit for Global Entry/TSA PreCheck

• Priority Pass airport lounge membership

Citi Prestige

Annual fee: $450

Sign-up bonus: 75,000 points

Spending required for sign-up bonus: $7,500

Points per dollar spent:

• 3 for travel, 2 for dining, 1 for all other purchase 

Other perks:

• $250 credit for airline expenses

• Book four nights at a hotel, and Citi will comp the fourth night

• $100 application credit for Global Entry/TSA PreCheck

• Priority Pass airport lounge membership

See the rest of the story at Business Insider

wooden model bridge bending

The most complacent stock market in history was shocked to attention last week after fiery comments from President Donald Trump about North Korea ratcheted up geopolitical tensions worldwide.

The S&P 500 dropped 1.5%, the most since May, as investors sought the relative safety of Treasury bonds and gold, clearly shaken by the potential for military escalation.

The benchmark index bounced back in a big way on Monday, climbing more than 1%, showing that there's still appetite for buying on weakness. It's a dynamic that's played out time and time again over the eight-year bull market, and it's helped keep the rally afloat through some tough times.

But there are cracks forming in the foundation of the equity rally slowly but surely. If you know where to look, there's no shortage of signs investors are feeling increasingly uneasy.

Here are three charts that show stock traders are not as confident about the market as Monday's relief rally would have you believe:

The stock market's fear gauge is spiking

Thursday's 44% spike in the VIX brought the fear gauge's three-day increase to 62%, which was the most since mid-2015 for a period of that length. This is significant because Trump's verbal escalation of the North Korea situation was deemed to be more anxiety-inspiring than some other major geopolitical events.

When faced with the UK's decision to leave the European Union, stocks sold off sharply, yet the VIX didn't spike to the degree it did last week. The fear gauge also failed to reach recent heights from just after the US presidential election, one of the biggest sources of market uncertainty in recent years.

A new volatility regime is being priced in

Now that we've discussed the VIX, what about expected volatility on the fear gauge itself? There's a handy measure for that, the CBOE VIX Volatility Index, or VVIX.

While the VIX spiked the most since May last Thursday, the VVIX did it one better, rising by the most since August 2015. In fact, the ratio of the VVIX relative to the VIX reached the highest ever, according to data compiled by Goldman Sachs.

Goldman isn't yet ready to say the volatility regime is shifting entirely, but the historically high ratio signals that markets are already bracing for more turbulent conditions.

Bearish puts on South Korean stocks are surging

The worry that rocked stocks worldwide last week was no more prevalent than in the South Korean market. The MSCI South Korea ETF (EWY) dropped 2.5% on Thursday, and fell 4.6% for the week.

Even more intriguing was the enormous volume in put contracts betting on a decline in EWY. It reached almost 70,000 units on Thursday, the most since early 2014, and totaled roughly 125,000 for the week, according to data compiled by Bloomberg.

Clearly investors are adopting a defensive, if not outright bearish, stance on South Korean equities as tensions boil. However, as Strategas Research Partners points out in the chart, the surge in put volume could be considered bullish — the logic being that the resulting weakness makes it easier to buy the dip, and also that sentiment isn't getting overextended to the upside.

See the rest of the story at Business Insider

  • shonda rhimes smilingShonda Rhimes' move to Netflix is bad for all of network TV, not just ABC.
  • It's another signal that broadcast TV is seen by big creators as limiting and less lucrative.
  • TV networks need to discover new talent, or risk losing more viewers – and ultimately advertisers.

Shonda Rhimes isn't just good at making good TV.

The creator of hits like "Grey's Anatomy" and "Scandal" is really good at making true broadcast TV.

And if more people like Rhimes decide they don't like that medium as much as Netflix's more lucrative and less rigid one, that spells trouble for major TV networks and their advertisers.

Because if the best creators no longer want to work with CBS, ABC, NBC and Fox, what are these networks left with, but the leftovers?

Rhimes, who just inked a big Netflix deal, has been particularly prolific at a unique, some would say fading, form of TV. Call it the buzzy-but-still-mainstream-enough network drama. Besides "Scandal" and "Grey's," she's responsible for "How to Get Away With Murder" and the former ABC hit "Private Practice." The Wall Street Journal reported that she brought in $2 billion for the network.

Besides tons of revenue, Rhimes filled ABC's schedule with hour-long shows that played out over 22 episodes a year. In an age where TV 'auteures' turn to streaming services to make six episode 'seasons,' making as much TV as Shondaland churns out is a very particular, increasingly rare set of skills.

Some of the top creators in TV have been more vocal about what a grind that kind of schedule is creatively. That's part of the reason why Tina Fey was happy that "Unbreakable Kimmy Schmidt" went from NBC to Netflix. A few months ago, "Gilmore Girls" creator Amy Sherman-Palladino told the Journal that she was probably done with network TV, given its storytelling limitations.

Rhimes hinted at this dynamic in the announcement of her Netflix deal, according to the New York Times. 

"[Netflix chief content officer] Ted [Sarandos] provides a clear, fearless space for creators at Netflix. He understood what I was looking for — the opportunity to build a vibrant new storytelling home for writers with the unique creative freedom and instantaneous global reach."

Of course, beyond the creative freedom, there's the $6 billion or so Netflix plans to spend on shows this year that has a way of attracting talent.

There's a lot of truth in this comment. Netflix is like the Yankees going after whichever free agent it wants. And unfortunately for their longevity, the broadcast networks risk becoming small market teams (or even worse, Netflix's minor league system).

It's why folks like Chuck Lorre (creator of "The Big Bang Theory" and "Two and a Half Men") and 70-year old Dick Wolf ("Law and Order" and umpteen Chicago-set dramas on NBC) can pretty much write their own ticket. It's also part of the motivation for Disney planning direct-to-consumer subscription offerings.

More importantly, it's vital for broadcast networks to find new creative talent that not only knows how to create a show that resonates, but one that plays well in the TV networks' 22-episodes a year business model – and ideally is so good that people have to tune in live. It might be time to keep more of an open mind regarding truly original series like Netflix's "Stranger Things," for example, which was rejected by lots of networks.

Otherwise, the more Shondaland fans that get their crazy twist fix from streaming ad-free shows, the fewer people will flip on ABC on Thursday nights. And eventually there'll be fewer advertisers willing to stick with network TV.

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Elon Musk

• Valuations of Tesla vary wildly.

• The company is fueled financially by a "story" about the future.

• It could be a decade before it's possible to properly value the company.

Generally speaking, investors want a precise assessment of what the companies they invest in are worth.

Valuation is both art and science, of course, as there's never a guarantee that a company will perform better in the future than it has in the past. But analysts strive mightily to favor the science side as much as possible.

Viewed through that lens — or spreadsheet — Tesla is confounding. Going by the most obvious number, the stock price, Tesla is worth $355 per share and has a market cap of $60 billion.

If you flew in from an alien planet where some type of money exists and math is used to value intergalactic undertakings, you'd be baffled: How can a company that makes vehicles and sells them for $100,000 on average post extremely infrequent profits?

You'd look at other companies that do the same thing, observe that General Motors and Ford have been steadily profitable for years and have piles of money in the bank, and ponder with some consternation the attitudes of investors on this strange planet of baffling valuations.

The confused alien scientist problem

Doctor Who Tom Baker BBC

I think everybody who tries to figure out what Tesla is really worth finds themselves in the position of the confused alien scientist. The bulls and bears on Wall Street are far apart, with price targets ranging from $464 at the high end to $155 at the low end. Valuation expert and NYU finance professor Aswath Damodaran is what I might call a coolly rational bear — he likes Tesla's chances, but he considers it to be wildly overvalued at the moment:

"My expected revenues for Tesla in ten years are close to $93 billion, a nine-fold increase from last year's revenues and a higher target than the $81 billion that I projected in my July 2016 valuation. Second, the operating margins, while still negative, have become less so in the most recent period, reducing reinvestment needs for funding growth. The free cash flows are still negative for the next seven years, a cash burn that will require about $15.5 billion in new capital infusions over that period. With those changes, the value per share that I estimate is about $192/share, about 20% higher than my $151 estimate a year ago, but well below the current price per share of $365."

Some back-of-the-envelope calculations reveal that Tesla will have to raise about 20% of its roughly projected revenue of $80 billion over a seven-year period, meaning that the revenue, while outwardly impressive, is going to be expensive. Basically, Tesla has to raise $2.2 billion per year to achieve $11 billion-$12 billion in annual revenues.

This is, believe it or not, a move in the right direction, as Tesla's 2016 revenues of $7 billion cost the company just over $5 billion, with an equity raise that year of about $1.5 billion — and a healthier amount of cash on the balance sheet at year's end than expected (although as Tesla launches the Model 3 in 2017, it expects to spend itself down to $1 billion, and it recently undertook its first junk-bond issuance, bringing in $1.8 billion at a near investment-grade rate of 5.25%).

If Damodaran is right, then Tesla's cash needs and infrequent profits will catch up with it at some point over the next few years and, combined with a general downturn in auto sales in the US (Tesla's biggest market), probably rationalize the stock price. Essentially, the future will arrive, and it won't be as prosperous as the more bullish analysts now think.

Don't count on it

TSLA Chart

That said, shares at $192 will still represent a huge gain from Tesla's 2010 IPO price of $17. And Tesla's legacy of volatility could fade, with shares tracking more closely to the company's business fundamental and farther from the pie-in-the-sky story of total auto-industry disruption that has propelled the market cap past the likes of Ford and Fiat Chrysler Automobiles.

I'd call this the best-case scenario because Tesla won't be going out of business, but it also won't be subject to heavy short-selling or ultra-bullish predictions that forecast the company taking control of over half the US annual auto market (I'm looking at you, Gene Munster).

model 3 event

Don't count on it, however, because cooler heads have always seen Tesla as being worth around $200 per share, optimistically, assuming that a massive amount of new competition doesn't hit the electric-vehicle market over the next decade. This is a reasonable assumption, as EVs are much more expensive than gas cars (even Tesla's "mass market" Model 3 is priced more like a BMW 3-Series luxury sedan than a Honda Civic) and overall EV sales now add up to only about 1%.

At various points in 2017, Tesla has surged toward $400 per share, undermining that thesis. 

As an investor, you literally lose money trying to fairly value Tesla as a company. And while the stock now looks pricey, if Tesla can build enough cars to fulfill its roughly 500,000 pre-orders for the Model 3, the appearance of all those vehicles on the road — with the attendant free PR — might send shares into orbit, regardless of whether Tesla is able to sell the Model 3 profitably.

Two equally unappealing options

So we're left with two unappealing options: Value Tesla based on its actual business and lose out on a massive investment gain; or go with the flow, forget about rational thinking, and hope that you can leave the party before everything comes crashing down.

Obviously, there's a third option: Sit Tesla out. I hold no Tesla stock for conflict-of-interest reasons, but I've spent enough time pondering the companies financials to conclude that the bankruptcy risk is low while the possibility of the carmaker being accurately valued in the future is high. 

If Tesla executes on CEO Elon Musk's vision, then it will be a more "normal" company with good chances to be steadily profitable in the future, with a stock that appreciates predictably and, if the global EV market grows, substantially after the 2030 period.

Then it will be possible to figure out what Tesla is really worth. And to invest accordingly. 

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Andreas Halvorsen

One of the world's largest hedge funds made a huge bet that scandal-plagued Wells Fargo's worst days are behind it.

Viking Global, a $30 billion asset manager founded by Norwegian billionaire Andreas Halvorsen, disclosed Monday it had bought 12.3 million shares in the troubled bank, worth around $681 million, in the second quarter.

The fund also cashed out its stake in JPMorgan Chase, selling 3.7 million shares worth $325 million, according to Bloomberg.

The filings represent second quarter holdings at Viking, so the firm's positions could have changed since the end of the quarter. 

Wells Fargo has withstood a fusillade of ugly news in the past year, recently agreeing to shell out $142 million to settle the fake accounts scandal that claimed the job of former-CEO John Stumpf and thousands of other employees.

This summer alone, the bank has come under fire for shady mortgage practiceswrongly charging customers for auto loan insurance, and failing to fully disclose the extent of its fraudulent sales practices. Chairman Stephen Sanger is expected to step down soon. 

But the bank's stock price has largely weathered the storm — it's down 3.7% in 2017, but is up 10% over the past year.

Viking will be betting that the scandals have already inflicted their damage, and that a board shakeup could set the country's third-largest bank by assets on a smoother path. 

The massive hedge fund, which is based out of Greenwich, Connecticut, has recently endured struggles of its own, facing billions in redemptions from large investors after a rocky 2016.  

The firm is having a much stronger 2017, up 9.3% through the end of July, according to Bloomberg

This article has been updated from its original version.

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NOW WATCH: Fidelity sector expert: Reports of a stock bubble are exaggerated

MUMBAI (Reuters) - India's second-biggest IT firm Infosys said on Saturday it will buy back shares worth up to 130 billion rupees ($2 billion), a day after Vishal Sikka resigned as chief executive after a long-running feud with the company's founders.

Narendra Modi

China and India have been locked in a military standoff in a remote section of the Himalayas for a couple of months. At first it appeared to be the latest of the minor clashes that have flared between the countries for decades. But this time it has lasted longer than usual. There are two questions to be answered. The first is what is the geopolitical interest, if any, that is driving the standoff? The second is why is it happening now?

The geopolitical issue is that China and India are both heavily populated countries with substantial military forces, including nuclear weapons. They are both industrializing rapidly, and they can both theoretically challenge each other on multiple levels – militarily, politically and economically. In fact, these challenges are all merely theoretical, but geopolitics operates at the level of possibility, and the possibility of a challenge is present, however remote. But before their rivalry can turn into full-fledged war, there’s one massive obstacle that would need to be overcome.

The moderating power of mountains

China and India are next to each other, but in a certain sense they don’t really share a border. The Himalayas separate them almost as much as an ocean would. Getting over the mountains is difficult; roads are sparse and generally in poor condition. It is easier to trade with each other by sea than land. Sending and supplying major military forces into and across the Himalayas is almost impossible. The roads and passes won’t permit the passage of enough supplies to sustain large numbers of troops in intense combat. In that sense, China and India are secure from each other

Both countries have nuclear weapons, and obviously, anything is possible. But neither side has anything to gain from a nuclear exchange. The Soviets and Americans avoided a nuclear exchange during the Cold War, and the Indians and Chinese have far less to gain from an exchange than they did.

China and India aren’t exactly equals – they’re close economically, but even that is a stretch. But the Himalayas are the equalizer, and the Himalayas aren’t going away.

dolam plateau

Conflict by other means

Their militaries may not be able to easily cross the Himalayas, but it takes little effort for them to attack each other politically. On the north side of the Himalayas lies Tibet. It is a plateau, consisting of a non-Chinese population, that was temporarily independent until it was reoccupied by China in the 1950s. In the chaos that followed the Chinese invasion, Tibet’s leader, the Dalai Lama, fled to India, where he was welcomed. The Dalai Lama continues to symbolize Tibetan independence, and Tibet continues to be restive under Chinese rule.

What is most important about Tibet is that it lies on the other side of the Himalayas from India. If Tibet became independent by some means and allied with India, then theoretically an Indian force could be based there and, in time, could build up a logistical system that could support an attack into China itself. This is all far-fetched, but given history, a prudent state must take the preposterous into account. History is filled with examples of the inconceivable becoming reality.

This, then, explains China’s obsession with Tibet and its anger at India’s support for the Dalai Lama. The Chinese core, Han China, is protected by buffers: Tibet, Xinjiang, Inner Mongolia and Manchuria. The last two are not a problem. Xinjiang has a significant Islamist movement. But Tibet is hostile and has a foreign patron. Beijing is therefore, if not obsessed, extremely concerned about Tibet and India.


That is the Chinese issue. India’s concern is the same in reverse. There are two other states on the southern side of the Himalayas: Bhutan and Nepal. Both are on plateaus. If China gained control of or a presence in either, it could also mass forces and logistical supplies and potentially threaten India with military force.

Nepal in particular concerns India, because it has been politically unstable and has a Maoist movement. Nepal also values its independence and resents India’s intrusions in its affairs. The Chinese have been solicitous of the independence of both countries, and just this week, China’s vice premier visited Nepal for four days. Before that visit, India’s foreign minister was in Nepal, and Nepal’s prime minister will visit India on Aug. 25. Suspicion abounds. The Indians are as suspicious of China’s intentions south of the Himalayas as China is of India’s north of them.

A political "solution"

A large-scale invasion would be a logistical nightmare for either country to orchestrate, but technically not impossible. The two did conduct a war in Tibet in 1962 for about month. Yet the brevity of the war speaks to the high cost and complexity of waging battle at 14,000 feet, so much so that it strongly discourages war. But a political evolution in Tibet or Nepal could change the balance. If Tibet threw out the Chinese and invited the Indians in, China would actually be in danger. If Nepal created a pro-Chinese government and invited in the Chinese while the Indians weren’t looking, the same could happen in reverse. And India is poking at Tibet and China at Nepal, the latter with some possibility of success.

The likelihood of either Tibet or Nepal moving out of China’s or India’s sphere of influence is doubtful. It’s hard to imagine that either could foment a sustainable uprising. If it were to happen, though, it could only be taken advantage of by one or the other having secured a road through the Himalayas that could support the movement of troops and supplies.

It is the Chinese now who are trying half-heartedly to build such a road into Bhutan. But there is a long way to go, and India will resist all the way. If the road even made it through, it would be met with a blocking force. Of course, a pro-Chinese government installed in Nepal or Bhutan would complicate the matter. If the Chinese could rapidly insert some troops, causing the Indians to have to initiate combat against Chinese forces, there is an outside chance that it could work, just as under even more trying circumstances it might work for India in Tibet.

India and China are separated by terrain. There is no military solution to that, but in this case, there might be a political solution. If that were to happen, then we could speak of a China-India rivalry in real terms, rather than in the vague, notional ways we speak now. And both sides are prepared to devote minor military force and major political power to prevent it from happening.

It is unlikely in the extreme that any of this will come to bear. But in a world where the impossible is not an absolute, neither country is prepared to gamble. And so they skirmish in altitudes at the limits of human endurance for a far-fetched possibility. Nations do not take their national security lightly merely because the threat is preposterous.

Check out more from Geopolitical Futures

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  • FILE PHOTO - Leon G. Cooperman, CEO of Omega Advisors, Inc., speaks on a panel at the annual Skybridge Alternatives Conference (SALT) in Las Vegas, Nevada, U.S. on May 7, 2015.  REUTERS/Rick Wilking/File Photo Lee Cooperman, a billionaire hedge fund manager, doesn't like the way another billionaire hedge fund manager, Bill Ackman, is approaching his latest big investment.
  • Ackman runs Pershing Square, an activist fund which takes positions in companies and tries to change them. 
  • Pershing Square is trying to shake up ADP, the human resources and payroll company.
  • Cooperman has layered on criticism, saying Ackman's approach is "destructive" and that he's full of "chutzpah."

Billionaire investor Lee Cooperman is stepping up his attack against fellow billionaire Bill Ackman.

In a phone call with Business Insider on Thursday, August 17, Cooperman laid out an argument against Ackman's attempt to change ADP, charging against what he perceived as Ackman's misguided attempt to shake up the human resources company.

"He's conducting himself in a very destructive manner," said Cooperman, the founder of Omega Advisors, a multi-billion New York-based hedge fund.

The human resources and payroll company ADP is under attack from Ackman's Pershing Square, an activist hedge fund that wants to add new directors to its board and potentially swap out its CEO. Earlier this month, Pershing Square disclosed an 8% stake in ADP, sparking a testy back-and-forth between the fund and the company which handles Americans' paychecks.

In an interview with CNBC last week, ADP CEO Carlos Rodriguez compared Ackman's request to extend the deadline for nominating board members to "a spoiled brat in school asking the teacher for an extension for their homework." Pershing Square has said that Rodriguez "unfairly characterized" their interactions to make the fund's efforts "appear unreasonable." 

On Thursday, Ackman said in a conference call that ADP had underperformed its competitors and that the stock could double in five years. 

For his part, it's not the first time Cooperman has come out against Pershing Square – he did so in an interview with CNBC earlier this month, too. But the matter is clearly still top of mind.

"I'm not in the business of criticizing people, but I think this is disgraceful," he told Business Insider Thursday, his voice rising.

"I'm not in the business of criticizing people, but I think this is disgraceful.

"I think his conduct is irresponsible. There’s a way of dealing with it; he could have quietly presented his findings to the company, allow them to digest it. The company has been run as an open book."

Ackman casts a "negative aspersion" on the hedge fund industry, Cooperman added.

Ackman contacted ADP's Rodriguez on August 1 about the fund's position, according to a Pershing Square filing earlier this week. ADP later announced Pershing Square's position in an August 4 press release

A representative for Ackman declined to comment.

Fast-talking Cooperman listed off a litany of issues he saw with Pershing Square's attempt to shift ADP, often repeating personal attacks on Ackman.

"He’s a hot dog trying to create maximum publicity without regard for the implications to management and the costs involved with this proxy fight," Cooperman said.

"He’s a hot dog trying to create maximum publicity.

Cooperman, who previously served on ADP's board, said he had given his shares to charity. He commended ADP for its value proposition and for its management.

ADP, he said, was worth about $10 million in the early 1960s and had steadily added value, worth about $60 billion today. "There are very few companies that can sustain that," he said.

"I don't have a strong opinion on the merits of his view," Cooperman said of Ackman's investment thesis. "I have a strong opinion on his comportment and civility." 

"He makes a big deal that he spoke with 85 former executives," Cooperman said. "I know for a fact the last three CEOs have not spoken with him."

Earlier on Thursday, Pershing Square presented its thesis on ADP. When asked what he thought about it, Cooperman said: "You don't follow what the f--- I'm saying," his voice rising. "I'm talking about the merits of his conduct." 

Cooperman said he didn't listen to Pershing Square's presentation this morning, as he was traveling on a plane.

Cooperman also brought up that Ackman had asked for an extension of the deadline to nominate board directors, which led to a contentious back and forth between ADP and Pershing Square.

bill ackman"He shows up and says he’s studied the company for six months. Why does he wait for the last minute for an audience with the board?" Cooperman said, adding, "The company is right. Who does he think he is? Given the company’s performance, if he was constructive, he should have waited a year … the company runs an open door policy … they’d have been happy to hear what he had to say ... He has chutzpah to ask them to extend the window."

Cooperman contacted Business Insider in response to a report earlier Thursday about an ADP board director whose position at Columbia Business School, which receives money from Pershing Square, poses a potential conflict. Cooperman took issue with the relationship being described as a conflict, calling it "bulls--t." When Business Insider responded that three academics in the story had described the relationship as such, he said, "you shouldn’t feed that bulls--t."

SEE ALSO: An ADP director has a relationship with the activist trying to shake it up — and it shows how messy Wall Street really is

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NOW WATCH: Fidelity sector expert: Reports of a stock bubble are exaggerated

Billionaire activist investor Carl Icahn gives an interview on FOX Business Network's Neil Cavuto show in New York February 11, 2014.   REUTERS/Brendan McDermid

Billionaire investor Carl Icahn is no longer advising President Donald Trump.

Icahn, who had been an unpaid adviser, announced the move on Twitter late Friday afternoon.

"Today, with President Trump’s blessing, I ceased to act as special advisor to the President on issues relating to regulatory reform," Icahn tweeted.

His announcement follows that of several business titans who have distanced themselves following the president's comments equivocating white supremacists with counterprotesters in Charlottesville.

Icahn's reasoning differs from the others, however, and makes no mention of Charlottesville. Icahn couldn't immediately be reached for comment.

He tied his decision to the July appointment of Neomi Rao as Administrator of the Office of Information and Regulatory Affairs — the helm of Trump's deregulatory agenda. In a statement posted to Icahn's business website, he said that he didn't want "partisan bickering about my role to in any way cloud your administration or Ms. Rao’s important work.

"Contrary to the insinuations of a handful of your Democratic critics, I never had access to nonpublic information or profited from my position, nor do I believe that my role presented conflicts of interest," he added.

Icahn, a Wall Street investor, had previously drawn criticism when it was announced that he would be advising the president on regulatory issues.

A Reuters investigation earlier this year found that his oil-refining company, CVR Energy, "made a massive bet in 2016 that prices for U.S. government biofuels credits would fall — just before Icahn started advising President Donald Trump on regulations driving that market."

Icahn's firm had positioned itself to slash regulatory costs by tens of millions of dollars if those credit prices fell, Reuters reported.

Rao, meanwhile, as administrator of the Office of Information and Regulatory Affairs, heads one of the most powerful agencies in the government. "The administrator accepts regulations or sends them back to be reworked, a decision that can expedite rules or effectively neutralize them by imposing extensive delays," The New York Times reported earlier this year in a profile of Rao.

Icahn posted a full statement on his website, which he said was a copy of the letter he had delivered to the president:

Dear Mr. President:

This will confirm our conversation today in which we agreed that I would cease to act as special advisor to the President on issues relating to regulatory reform.

As I discussed with you, I’ve received a number of inquiries over the last month regarding the recent appointment of Neomi Rao as Administrator of the Office of Information and Regulatory Affairs (or “regulatory czar,” as the press has dubbed her) – specifically questions about whether there was any overlap between her formal position and my unofficial role. As I know you are aware, the answer to that question is an unequivocal no, for the simple reason that I had no duties whatsoever.

I never had a formal position with your administration nor a policymaking role. And contrary to the insinuations of a handful of your Democratic critics, I never had access to nonpublic information or profited from my position, nor do I believe that my role presented conflicts of interest. Indeed, out of an abundance of caution, the only issues I ever discussed with you were broad matters of policy affecting the refining industry. I never sought any special benefit for any company with which I have been involved, and have only expressed views that I believed would benefit the refining industry as a whole.

Nevertheless, I chose to end this arrangement (with your blessing) because I did not want partisan bickering about my role to in any way cloud your administration or Ms. Rao’s important work. While I do not know Ms. Rao and played no part in her appointment, I am confident based on what I’ve read of her accomplishments that she is the right person for this important job.

I sincerely regret that because of your extremely busy schedule, as well as my own, I have not had the opportunity to spend nearly as much time as I’d hoped on regulatory issues. I truly appreciate the confidence you have in me and sincerely hope that the limited insights I shared have been helpful to you. I love our country which has allowed me to achieve so much and I thank you for the informal opportunity you have given me to aid it.



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gary cohn

Markets tumbled on Thursday after rumors swirled that Gary Cohn, President Donald Trump's top economic adviser and formerly Goldman Sach's number two, was resigning.

The S&P 500 slumped at around 10 a.m. ET, after the rumors began swirling on Twitter. Gold, a traditional safe haven trade, climbed as investors pulled into safety assets.

The White House denied this was happening, and Cohn (as of the time this post was written) was still in. Still, Wall Street's jitteriness reflects fears that a Cohn departure would stifle some of the administration's business-friendly ideas. 

"I don't want to be an alarmist, but there is a lot of faith that he is going to help carry through the tax reform that people are looking for," Yale School of Management's Jeffrey Sonnenfeld told CNBC on Thursday.

"I think if he steps away, it would crash markets."spx cohn rumors v2

Stocks rallied after Trump's November election as investors considered the possibility of deregulation, fiscal stimulus, and tax cuts. And they continued climbing, despite the nonstop scandals and political dramas pouring out of the White House.

But already by spring, Wall Street was starting to itch.

"The biggest disappointment of 2017 has been Washington DC. Hopes for transformative fiscal action have been dashed by the inability to find legislative consensus, despite single-party control of both Congress and the presidency," a Morgan Stanley team led by strategist Andrew Sheets wrote on April 20, after the original health care bill was pulled from the House in late March.

Now, several months later, the general business community appears to have somewhat cooled towards Trump. In recent days, Merck CEO Kenneth Frazier's decision to resign from the president's manufacturing council was followed by an exodus of other executives and led to the eventual disbanding of two panels mostly made up of business leaders.

Against this backdrop, early Cohn exit could be enough to break the market's confidence in the Trump administration's ability to pass pro-business agenda, Jaret Seiberg, an analyst at Cowen Washington Research Group, said in a note Thursday.

Isaac Boltansky at Compass Point echoed that sentiment in a note on Thursday: "We have no insight into Mr. Cohn’s plans, but our sense from client conversations is that his departure would surely dampen Wall Street’s already dwindling confidence in Washington’s capacity to govern."

SEE ALSO: ANALYST: Most investors respect the Merck CEO’s decision to resign from Trump’s council

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Big banks need to split their retail services from riskier investment divisions by 2019

Carl Icahn

Hours after billionaire investor Carl Icahn said he would no longer be advising President Trump, The New Yorker dropped a lengthy story on his efforts to change a policy that hurt a company he is invested in.

The story, by , said that Icahn could be in "legal jeopardy."

“He’s walking right into possible criminal charges,” Richard Painter, a Bush administration ethics lawyer, told Keefe.

Painter cited a federal statute that "makes it illegal for executive-branch employees to work on any matter in which they may have a direct financial interest." Icahn's lawyer told Keefe the rule doesn't apply to Icahn. 

If you have time, go read the full story, which is excellent. If you're short on time, here are the key takeaways:

  • Icahn has a 82% stake in CVR, a refiner.
  • Refiners have to blend ethanol into their products, or buy credits, called Renewable Identification Numbers (RIN), from refiners that do. The cost of these RINs has increased, costing CVR more and more money.
  • Icahn has lobbied vocally against the policy that forces refiners like CVR to buy RINs, arguing in favor of changing the "point of obligation," which would force other parties to buy them instead. In an oped in The Wall Street Journal, he likened RINs to the mortgage-backed securities that fueled the financial crisis.
  • In December, it was announced that Icahn would be a special adviser to Trump, then the president-elect, with a focus on regulation. "His help on the strangling regulations that our country is faced with will be invaluable," Trump said at the time. 
  • According to The New Yorker, Icahn told Bob Dinneen, the head of the Renewable Fuels Association, which had been supporting the existing RIN policy, in February that an executive order would change the rules. Dinneen told Keefe that while Icahn never said explicitly that he was talking on behalf of Trump, “Icahn had a title I couldn’t ignore.”
  • “Icahn was always talking about an ‘executive order’—that was his vernacular,” Dinneen told The New Yorker. According to Icahn's lawyer, Icahn only expressed “hope” that Trump would agree with his view on RINs.
  • Either way, Dinneen said he would propose to his board that the Renewable Fuels Association would end its opposition to the "point of obligation" change. When news leaked of the potential change in the association's stance, there was an outcry from the ethanol industry.
  • A spokeswoman for the White House later denied that there was any plan to shift the point of obligation.
  • Keefe reported that an official in the Trump administration told him that there was a draft executive order, but that it was "something Icahn sent to us." Icahn's lawyer denied that Icahn had prepared the executive order.
  • According to Painter, Icahn is "walking right into possible criminal charges,” because of "a federal statute that makes it illegal for executive-branch employees to work on any matter in which they may have a direct financial interest." As a reminder, Icahn had the title "special adviser to the president."
  • Icahn's lawyer told Keefe the relevant law does not apply to Icahn: “Unlike a government employee, Mr. Icahn has no official role or duties and he is not in a position to set policy.”

Read the full story at The New Yorker here »

SEE ALSO: Billionaire Carl Icahn quits advising Trump

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Billionaire investor facing conflict of interest claims steps down from role

By contrast, four in ten UK adults have no property wealth at all, the Resolution Foundation says.

Trump administration risks retaliation with probe of intellectual property practices

DETROIT (Reuters) - Federal prosecutors on Friday recommended a three-year prison sentence for Volkswagen AG engineer James Liang for his role in a diesel emissions scandal that has cost the German automaker as much as $25 billion.

SAO PAULO (Reuters) - Citigroup Inc and seven other banks will underwrite the initial public offering of Petróleo Brasileiro SA's fuel distribution unit, which will likely occur in November, a person with direct knowledge of the plan said.

NEW YORK (Reuters) - The Trump-fed rally in stocks, lately showing signs of faltering as the long Wall Street summer nears its end, faces a key test in the weeks ahead with the approach of a historically unkind season for equities and a clutch of issues - such as raising the debt ceiling - awaiting the return of lawmakers to Washington.

Corporate America is shunning the president after his comments on white nationalists

NEW YORK (AP) -- Piracy is a long-running and even routine issue for Hollywood, whether it's street vendors hawking bootleg DVDs on street corners or video uploaded to file-sharing sites like Pirate Bay. Now cybercriminals are also putting embarrassing chatter and other company secrets at risk....

NEW YORK (AP) -- The CEO of 21st Century Fox denounced racism and terrorists while expressing concern over President Donald Trump's reaction to the deadly violence surrounding a white nationalist rally in Charlottesville, Virginia....

WASHINGTON (Reuters) - The stock market's steady rise, still low long-term bond yields and a sagging dollar are girding the Fed's intent to raise interest rates again this year despite concerns about weak inflation, according to comments this week from Fed officials and analysts anticipating remarks next week by Chair Janet Yellen.

But much political humour is too obvious, too lazy and stuck in a comfort zone

Turkish president declares main political groups ‘enemies of Turkey’

18:06 11 US states added jobs in July (Associated Press)
WASHINGTON (AP) -- Hiring increased in 11 U.S. states in July, while the unemployment rate tumbled to record lows in two states....

Academic publisher under fire for caving in to pressure from Beijing

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