May 30 (Bloomberg) -- Back in April 2013, the SEC said OK, fine. You can post materially important information about your company on social media as long as you make the public aware that this stuff might wind up there. This was after Netflix Chief Executive Officer Reed Hastings made comments on Facebook about the company’s viewership levels, and it created a bit of a buzz.
Yesterday, Retrophin CEO Martin Shkreli, the subject of a thorough profile from Bloomberg Businessweek just last month, may have tested the boundaries.
It was a coy Twitter message at first, asking his followers if everyone was “having a nice day.” This was at 3:40 p.m., presumably New York time because the company is based there.
Why, yes, Martin. And you?
A follower, @ColfaxCapital, replies to Shkreli, “youre such a kind man :)” at 3:42 p.m.
The next tweet from Shkreli: “this is one of the best days of my life!” That was also at 3:42 p.m.
Was he talking about the company’s hiring of Stephen Aselage as president? Could have been. But that was announced via Business Wire a full day earlier, at 8:30 a.m. on May 28.
Then another follower, @ASeizew, writes, “ yes thanks. Going to buy 1000 shares of $RTRX through my Schwab account right now to celebrate it.” That was at 3:45 p.m.
Wait, what? Celebrate what?
At 4 p.m. the stock was halted.
At 4:41 p.m., almost an hour after his kindness on one of Shkreli’s best days led to the celebration, what surely would seem to be material information for the company crossed the wire.
*RETROPHIN IN U.S. LICENSE PACT FOR THIOLA (TIOPRONIN)
*RETROPHIN BOOSTS FORECAST
*RETROPHIN SEES 2014 REV. $30M - $35M, SAW $20M - $22M
And so on. The shares, which had settled at $12.88 in regular trading, down $1.05, or 7.5 percent, shot up to close to $17 in after-market trading
Why had @ColfaxCapital felt Shkreli was so kind? All he had done is ask if people were having a nice day. Was the question Shkreli asking also a statement?
What was the “it” that @ASeizew was celebrating?
Today’s economic indicators include personal income and spending at 8:30 a.m. EDT and UMich confidence at 9:55 a.m. Outside the U.S. we’ll get GDP figures from Brazil at 8 a.m. EDT and from Canada at 8:30 a.m.
Paul McCulley, Pimco’s chief economist, will be a guest on Bloomberg TV this morning at 7:45 a.m. EDT.
Otherwise, it’s Friday.
We’ve said plenty already about BNP Paribas, so no need to cover the same ground as we note yesterday’s news that the fine the French bank faces for being the bankers to U.S.-sanctioned countries has steadily grown from punitive to hefty to, now, officially staggering at more than $10 billion.
As Tom Schoenberg reports, “prosecutors argue that a more severe penalty against BNP is justified because the misconduct was more egregious and the bank didn’t fully cooperate with the investigation,” citing a person with knowledge of the matter.
He also notes that most of the BNP deals under investigation wouldn’t have broken French or European law, but fell into U.S. jurisdiction because they were processed in U.S. dollars. The speculation is that the fine has swollen in exchange for not excluding the bank from the dollar-payment system, which would likely cost them customers.
So, without starting the lawnmower again, we’ll just remind some readers what’s at stake underneath all this, in human terms.
Meriam Ibrahim gave birth to a girl Tuesday in a prison in Sudan, one of the countries whose money BNP was happy to handle. She had been sentenced to death earlier this month for refusing to renounce her Christian faith.
It’s her second child. The first, 18-month old son Martin, is in prison with her. Ibrahim has no intention of renouncing her faith, and she has been given two years to breastfeed her newborn before she’s hanged.
Just for the record.
Bringing enlightenment to Europe’s corporate-bond market -- or just light -- isn’t coming without its share of kicking and screaming.
EU rules, almost 1,000 pages of them, on bringing transparency to bond prices are surfacing this month, and they will be even more demanding than what traders deal with in the U.S. and the Trace system of reporting: Whereas U.S. completed trades have to be reported to Trace within 15 minutes, the European system is going to require posting before and after completion.
But while regulators in the U.S. threw open the window over many years, the change coming to Europe’s bond desk is coming fast and hard, and there’s an argument that it’s too much too soon. Final recommendations are expected at the European Commission by December. Banks, then, rather than beefing up staff to handle the added expectations, and already hurting from tumbling trading revenue, are retreating from the field of play by cutting back on the operations.
“Big institutions can trade in the dark, and that isn’t fair to other investors,” Arlene McCarthy, former vice-chairwoman of the European Parliament’s Economic & Monetary Affairs Committee, tells John Glover. “We wanted to level the playing field for the smaller player.”
Seems that throwing open windows is the thing to do in spring. While objections to maker-taker relationships in stocks are debatable -- like the guy who sells weed, if he’s going to take the risk of keeping it in stock, his customers are going to pay the risk premium -- the incentives that derivatives exchanges are offering for trading in their contracts are something else.
Something maybe closer to a kickback.
This appears to be what Virtu Financial was talking about in March when it filed for its initial public offering, later shelved as the curtain on its kind of business was drawn further back by the publication of Michael Lewis’s book, “Flash Boys.”
(We’d like to stress on behalf of our lawyers that just because we mentioned Virtu in this context doesn’t mean we are connecting them to any wrongdoing. Simply that this is probably the context of their statement in March.)
The CFTC is trying to find who’s getting these discounts for being an early customer and whether those discounts ever end, Matthew Leising reported late yesterday. His scoop comes a few days before the CFTC is scheduled to hold a public meeting on the potential harmful effects high-frequency trading firms bring to derivatives markets.
“The futures market differs from the stock market in that once you have liquidity in a contract -- once a contract becomes popular on your exchange -- it’s not that hard to get something that’s very like a monopoly in that contract,” Chris Nagi, managing editor for U.S. stocks coverage, tells us. Some contracts trade on the CME, some on ICE, “but it’s relatively rare that similar contracts trade on two different venues, because once popularity accrues on one venue, it gets cleared on that venue, and barriers to competition become rather high as a result.
‘‘It becomes an issue of how much largesse is being exchanged for these market kingmakers -- some high-frequency trader who has the ability to make or break a contract’s popularity” Nagi says. “The exchanges potentially have a lot of reason to want to attract them to a given contract, and the CFTC is seeing just how far they go with that.”
Japan’s prime minister, Shinzo Abe, will deliver the keynote speech at the “Shangri-La Dialogue,” the gathering of the International Institute for Strategic Studies Asia Security Summit held annually at the Shangri-La Hotel in Singapore, starting today. U.S. Defense Secretary Chuck Hagel will be on hand as political leaders and defense officials from Asia, Europe and the U.S. discuss regional security.
They’ll have plenty to discuss.
Because while China has shown a predilection for economic priorities over conflict with its neighbors in the post-Tiananmen years, it may no longer be interested in being Mr. Nice Guy. This is the analysis in Bloomberg Businessweek today from Joshua Kurlantzick, senior fellow for Southeast Asia at the Council on Foreign Relations.
“Today’s Chinese leaders, particularly those immediately below Xi, came of age after the Cultural Revolution. Instead of chaos and poverty, they have known an increasingly rich and powerful China,” Kurlantzick writes. “Xi himself always had nationalist leanings and came into office vowing to restore the greatness China enjoyed for centuries. And compared with even a decade ago, when most Chinese wanted their leaders to focus on continuing the country’s economic miracle, the ever-richer middle class is interested in foreign relations and staunchly backs a more forceful leadership.”
China increased military spending by more than 12 percent last year while moving to lay claim to perhaps all of the South China Sea, sparking an arms race with Indonesia, Malaysia, the Philippines, Singapore, and Vietnam; Southeast Asia’s arms purchases are growing faster than almost any other region in the world.
Enter the dragon.
Royal Bank of Scotland is still in the weeds in Ireland, where the collapse of property values and the economy ranked among the worst in Europe, and they’re trying to find a way out.
Probably because they’re being pressured to, Joe Brennan reports today.
RBS is seeking investors for a stake in its operations in the Republic of Ireland or for another bank to merge and dilute its holding, after racking up 17 billion pounds of losses. Chief Executive Ross McEwan is under pressure to return some of the 45.5 billion pounds ($76.1 billion) British taxpayers injected into the Edinburgh-based lender during the financial crisis of 2008 ahead of next year’s elections.
Extracting itself now, just as things are turning around, is a sign that “the timing may reflect a political rather than a commercial agenda,” Stephen Lyons, an analyst at Dublin-based J&E Davy, tells Brennan. “Selling a stake in the near term wouldn’t capture the business’s proper value.”
Ireland is a beautiful place, you have to admit, and it looks priced to sell.
We engineered sound for a ska-reggae band in the late 80s/early 90s, just as F.W. de Klerk was beginning to dismantle apartheid and not long after Paul Simon recorded his album ‘Graceland’ with the South African choir Ladysmith Black Mambazo. It was a very exciting time in the world -- for the end of the racist state, the fall of the Berlin Wall, the uprising in Tiananmen Square, the release of Nelson Mandela. So-called world music was the new thing, and everyone in the band was obsessed with the South Africa sound.
One of the most beautiful, inspiring and perhaps ironic characteristics of South Africa, despite the hardship of life there in the poorer townships, is the music. No matter how miserable the conditions of their lives are, the soaring sounds of their harmonies in minor keys, the time signature of their verses, will push the blood around inside you.
Think we’re exaggerating? Watch this: http://www.youtube.com/watch?v=yk1nR6n5KPw
That is the president of South Africa, the head of state, leading the funeral for Nelson Mandela in song. It took the rest of the room about five seconds to follow. You’re not going to see this at Arlington National Cemetery, and if it doesn’t get you somewhere in the throat, you may not be entirely human.
The struggle to foster this elemental part of South Africa’s soul is found today in Manuela Hoelterhoff’s interview with Shirley Apthorp, the founder of Umculo, the organization Apthorp founded to bring music to deprived communities -- or to bring it out of them. And not just any music -- the big stuff: Wagner, Mozart, Handel.
While the children of Cape Town and Soweto sleep and eat and bathe in conditions you would find primitive at best, the arts establishment in the developed world continues to heap accolades and million-dollar prizes on the most usual of suspects, the well-fed and well-paid elite who need another award as much as a frog needs a bicycle -- prizes that would endow an outfit like Umcolo for years.
If you read the story, keep this in mind: While there’s no telling if or when the upper echelons of the arts world will reach down to South Africa, more than one of you reading this out there is capable of rectifying this imbalance with the stroke of a pen.
It’s movie time. Following last weekend’s mammoth opening for the seventh X-Men movie, which has to explain the appeal of TV dinners, a couple of new contenders arrive.
The first one, “Maleficent,” stars Angelina Jolie and a set of cheek implants that are really a thing to behold, especially when adorning the last person on Earth who might need them.
Jolie plays a once-benevolent fairy turned queen of evil after getting jilted by the father of a girl we grew up coming to know as Sleeping Beauty. There’s a lot of magic and stuff, probably some of that Game of Thrones vibe, and in the end everyone winds up happily ever after because this is a Disney movie and when is the last time you saw a Disney movie when someone gets rightfully capped in the end? Thought so.
The other movie, “A Million Ways to Die in the West,” finds Seth MacFarlane as a dolt who would rather be anywhere than where he is, which is 1880s Arizona. It costars Charlize Theron, Liam Neeson, Neil Patrick Harris, Sarah Silverman, Giovanni Ribisi and as many gross-out jokes about death, bodily fluids, sex and death as you could fit into 114 minutes, which still isn’t enough for us.
Yesterday’s report that Donald and Rochelle Sterling had a received a $1.2 billion offer for the L.A. Clippers was pretty stunning. But that was when it was $1.2 billion.
The team was sold overnight to former Microsoft CEO Steve Ballmer for $2 billion. Two billion dollars for the former Buffalo Braves of Bob McAdoo, a team with a lifetime winning percentage of .382, according to basketballreference.com.
Call it the prejudice premium.
Is it going to happen? The press release that moved just a couple hours ago said it was a binding contract.
San Antonio beat Oklahoma City last night in Game 5 of the NBA Western Conference final by a score of 117-89, despite Kevin Durant’s 25 points for the Thunder, and will try to close it out tomorrow night in Oklahoma City.
*N.Y. RANGERS BEAT CANADIENS 1-0 TO REACH STANLEY CUP FINALS
After having one of his worst games in a while two nights before, Rangers goalie Henrik Lundqvist wasn’t even tested much last night. The Canadiens, after withstanding a fearsome surge from the Rangers in the first five minutes or so of play, took it to Lundqvist a little bit, but he didn’t flinch. In the end he only faced 18 shots to the Rangers’ 32.
And once the Rangers scored, with less than two minutes remaining in the second period, you could see the Canadiens sag. Where once only moments before they were skating in the seams of play, they were now fumbling, getting tied up in little dead ends they had avoided through the first 38:07 of the 60-minute game.
Funny how you never know, isn’t it? Your team mumbles its way through what appears to be another season, signs of good play here and there, but nothing spectacular. A record of 45-31-6 for 96 points, finishing second in the division -- pretty good. But then Boston had gone 54-19-9 this year and looked indomitable.
They might learn who their opponent will be tonight, when the Los Angeles Kings host the Chicago Blackhawks in Game 6 of the Western Conference final, which the Kings lead 3-2.
To contact the reporter on this story: C. Thompson in Wilmington at firstname.lastname@example.org
To contact the editor responsible for this story: Marty Schenker at email@example.com