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Poker Jargon Makes Reading Dictionaries Useless: Opening Line

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James Garner stars as Bret Maverick, an adventurous, charming, poker-playing gambler who roams the Old West. Close

James Garner stars as Bret Maverick, an adventurous, charming, poker-playing gambler... Read More

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Source: ABC Photo Archives/ABC via Getty Images

James Garner stars as Bret Maverick, an adventurous, charming, poker-playing gambler who roams the Old West.

James McManus is a big deal in the poker world. He wrote “Positively Fifth Street,” a book about the murder of a casino executive and the 2000 World Series of Poker, and “Cowboys Full: The Full Story of Poker,” and he has covered the game for the New York Times, the New Yorker, Harper’s and Card Player magazine. And now he writes for Bloomberg View.

A lot of you folks have a natural affinity for poker for obvious reasons, and except for stories about cricket and, well, financial markets, we hadn’t encountered this kind of an argot in what is otherwise English.

He described Greenlight Capital’s David Einhorn turn last week at the table as “sitting in the small blind with pocket jacks,” and throws around terms like “the flop,” “the turn” and “the river.” Those expressions (for the rest of you who are as clueless as we are), in order, refer to the first three cards dealt, the fourth card, and the fifth card.

They give rise to sentences like this one:

“A few hands later, he pushed all in before the flop with an ace-4, tempting Colman to call him with a slightly inferior king-queen. After a flop of ace-4-jack, it looked like Negreanu would double through and have more than a fighting chance again. But a 10 on the turn gave Colman a Broadway straight.”

We tracked him down in Las Vegas and asked what happens when he comes across a term he doesn’t know. Does he just pretend to know and figure out later, or stop and ask?

“I will often ask,” McManus said while covering the Big One for One Drop charity tournament. “I consider it part of my job to know what the current lingo is.” New vocabulary arrives “all the time.” He adds that both “Fifth Street” and “Cowboys Full” have extensive glossaries of the terms.

The vocabulary isn’t the only thing that has changed. The flossers have taken over.

“The game used to be grizzled, Texas road gamblers who were tough guys. The force of their personality and ornery nature could force you out of the pot with a bet,” he says. “The people who dominate the poker world today are young college-educated quants who are not scared of tough guys and they don’t try to bully you out of the pot with their persona.” But with their familiarity with game theory, “they do things that are similar to what the old badasses do, but they do it for mathematical reasons.”

***

There are no U.S. economic indicators on the calendar and nothing on the earnings calendar. Alcoa reports tomorrow, thus ushering in second-quarter earnings season.

German industrial output fell in May and rose less than than some economists estimated in Spain.

***

+ ADM agreed to buy Wild Flavors GmbH for about 2.2 billion euros ($2.99 billion) in cash. + An Argentinian group will meet in New York with a court-appointed mediator over its bond squeeze. + Allergan shareholders suing the company over its poison pill will be heard in a Delaware court. + Let’s Gowex CEO said he faked accounts, leaving the company insolvent. + The recovery of three Boeing 737 fuselages in Montana’s Clark Fork River begins. + American Apparel investor Standard General is considering paying the $10 million loan that Lion Capital may call following Dov Charney’s ouster. + Tesla wants to study the wreckage of a stolen Model S that crashed, causing a battery fire. + Germany’s arrest of an intelligence agency technician for spying on behalf of the U.S. has Merkel doubting the countries’ relationship anew. + The Hobby Lobby decision has opened a new set of requests from religious groups seeking exemption from measures outlawing discrimination of LGBT. + Partial score from Pamplona: Bulls 1, runner’s thigh 0 + Iran nuclear talks were to resume in Vienna at about 3 a.m. EDT today. + The NSA intercepted conversations of far more unintended targets than intended ones, the Washington Post reports. + Egypt’s El-Sissi wishes the three journalists jailed for ties to the Muslim Brotherhood were never put on trial. + Banks are backing away from transferring money out of the U.S. + Darwinism does not take a holiday. + Two more toddlers died over the weekend from being left in cars. + More than 60 people were shot in Chicago over the holiday weekend, seven fatally. + Super typhoon Neoguri is bearing down on Japan. + Electronic devices will have to be turned on at some overseas airports with flights to the U.S., the TSA says. + Here are photos of ISIL destroying Iraqi shrines. + The New York Post reports Obama would throw his support behind Elizabeth Warren, not Hillary Clinton, in the 2016 election. Supposedly she’s not running. + Pink Floyd, such as it is, will release its first album in 20 years in October.

***

Growth in worker productivity in the U.S. could be the integer that corrupts the FOMC’s equation for calculating policy decisions, Rich Miller and the U.S. economics team report, comparing Janet Yellen’s term as Fed chair so far to the conditions faced by Arthur Burns in the 1970s.

Without gains in efficiency as the economy and wages grow, there’s a greater chance of short-term inflation, and underestimating the strength in the labor market -- Thursday’s jobs report being Exhibit A -- while overestimating the pace of the economy’s expansion and worker productivity could be the trap that Martin Feldstein and others are concerned about, Bill Gross’s opinions notwithstanding.

The Fed is “probably going to respond too weakly, too slowly,” Miller recounts Feldstein saying June 4. If Yellen and the FOMC don’t sufficiently figure declining productivity into their equations, “you’re going to see it show up in faster inflation,” JPMorgan Chase’s chief U.S. economist, Michael Feroli, tells Miller, making the case for a rate increase sooner rather than later -- a case Goldman Sachs is joining.

***

With flat water still surrounding equity-trading desks, block trades are the thing now, and Citigroup (C) is king so far this year.

Discount spreads on bought deals are their narrowest since 2005, and volume is almost double what it was four years ago, Michael Moore and Dakin Campbell report. They find that while such a deal carries a fair amount of risk that the price of the equities will head south before the block can be flipped, the strategy improves a bank’s stature in collateral businesses such as investment banking.

The value of block trades rose to $90.8 billion last year from $50.5 billion in 2010, according to Dealogic, with the total this year through June 18 at $41.5 billion, Moore and Campbell report. They note the business is growing with private equity looking to unload stakes in companies they have brought to market.

While the discount spreads have narrowed, dropping to around 3 percent so far this year from an average of 6.8 percent in 2009 after the, well, you know, they won’t stay that way forever once the seas start to churn again.

***

The U.S. House of Representatives, stung and embarrassed by allegations that a staff member and perhaps members of one of its most powerful panels, the Ways and Means Committee, may have disclosed nonpublic, material information on government health-care spending to the financial markets, reacted swiftly to the SEC’s subpoena for information on the matter.

Chastened by an apparent violation of a law the august body itself created, and moving to preserve and protect its standing among its constituents and the entire U.S., the House did not equivocate when confronted by the executive branch of the U.S. government about alleged misdeeds that may have been used to take advantage of the legislators’ power and privilege.

With the dignity of an elected body facing the prospect of something so plebeian as an insider-trading probe, it wrote to the judge demanding an answer on his year-old order to provide documents and said: Take a hike.

***

Sounds like the securities markets are getting difficult to read.

You were all expecting rising Treasury yields around the start of the year, but, (disregarding the moves at the end of last week), that didn’t happen -- new neutral, etc. -- and in stocks it’s proving fruitless to shy away from cyclicals.

The dents in technology and small-cap stocks from last April have been hammered out and, especially after the signs coming from last week’s jobs report, those leaning toward so-called defensive stocks like utilities are getting caught leaning the wrong way -- for the third straight year.

Joseph Ciolli and Lu Wang report ETFs have added about $6.9 billion this year to funds tracking energy and more than $3 billion to health-care and utilities, while about $550 million moved into technology ETFs and consumer/retail funds saw withdrawals of $3.5 billion.

Yet since April 11, small-cap and technology stocks have led the way up, with Netflix rising 43 percent, Micron up 60 percent, and Home Depot gaining 14 percent to move within about 1 percent of its all-time high.

Here (RTY)’s the spread between the Russell 2000 and the S&P 500 Utilities index, and here’s one comparing the Russell 2000 and the S&P 500 Retail index.

***

We smoke, we’re ashamed to admit. It started, as these things do, in our adolescence, when the weight of decisions like these can’t be measured no matter how many people hold the scales before your eyes and beg you to reconsider.

We quit for a while, and we don’t smoke very much, in fact: A pack can last the better part of a week. The problem is we like it, just as we like a bourbon poured over a rocks glass packed tight with finely crushed ice, a Wild Turkey snow cone.

If it’s just one after another, that’s not smoking, that’s breathing an alloy. There should be ritual and appreciation for what Kurt Vonnegut once described as “slow-motion suicide.”

There are few times better than after a good swim in the ocean. Well, were better.

***

Vincenzo Nibali is wearing the race leader’s yellow jersey today after stealing the show in yesterday’s second stage of the Tour de France, during an unusually early show of force by the race’s most elite riders jockeying for position.

Alberto Contador is back this year after a doping ban and wasted little time making his presence felt. With Stage 1 winner and yellow-jersey placeholder Marcel Kittel having been dropped by the race leaders over an undulating stage with surprisingly difficult climbs, considering it’s England and they’re not even anywhere near the Alps or Pyrenees yet, the premier riders from each team coagulated at the head of the race, unsure just how things might play out and unwilling to risk a mistake, even so early.

In the final kilometers, Contador began his pedal-dancing attacks, drawing out last year’s winner, Chris Froome, who kept Contador in check, as well as a lurking Peter Sagan. While they were all giving one another the side eye, Nibali shot out of the lead group in the final couple kilometers, and none of the others had the engine to hunt him down.

Nibali wasn’t so proficient at the post-race kiss, however.

Froome, Contador, Sagan and 17 other riders sit two seconds back.

***

Congratulations to Novak Djokovic and Petra Kvitova on their championships at Wimbledon.

Cheers also to Brazil, Germany, Argentina and the Netherlands for advancing to the semifinals of soccer’s World Cup. Brazil and Germany will play tomorrow and Argentina will play the Netherlands on Wednesday.

It’s a shame about Neymar, the Brazilian star who was badly injured in the quarterfinals against Colombia, but in this New York Times analysis, it sounds a bit like “live by the sword, die by the sword.”

People often (always) ask why there is fighting in ice hockey. Rightly or wrongly, fighting in hockey is a self-policing mechanism of the sport that was devised over the many years as a way to prevent situations like Neymar’s from happening at all.

There is too much happening on the ice away from the referees’ eyes, and the game is too physical and intense and reliant on intimidation to expect a penalty for everything that goes down. So the understanding among players generally is that if you try to hurt our best players, our top scorers, you’re going to get beat up.

Often you’ll hear hockey commentators referring to how the refs have “lost control of the game.” The Times story makes the case that they lost it in the Brazil-Colombia match, and now one of the sports biggest stars will be missing from its biggest stage.

No, we’re not suggesting fighting in soccer.

To contact the reporter on this story: C. Thompson in Wilmington at cthompson1@bloomberg.net

To contact the editor responsible for this story: Marty Schenker at mschenker@bloomberg.net

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