Lots Going On Out There; We’re Leading With Golf: Opening LineC. Thompson
It’s the first day of the British Open golf tournament, and, as has become our custom before majors, we checked in with golf writer Mike Buteau to get his sense of the weekend ahead. But first, a note.
To all of our treasured customers and readers in the U.K. and elsewhere, we’re aware that the tournament calls itself “The Open Championship,” as if it were the only one, or the only one that mattered. But the Bloomberg News in-house style manual dictates that it be called the British Open, and here in the States, people call it the British Open.
OL: Mike, you’ve been to Royal Liverpool. What’s it like?
MB: It’s right on the water. There’s a path that people ride their bikes and walk their dogs along right on the edge of the course. Very unique and different sort of place. Very casual.
OL: So like a lot of these of these British Opens, if you don’t like the weather, just wait 15 minutes.
MB: (laughs): Absolutely. The year I covered the British Open (Royal Birkdale in 2008) is the only golf tournament I’ve ever gone to when I walked into the pro shop and bought a winter hat -- like, a ski-style, knit winter hat. It was that cold. It’s not like July in the U.S., that’s for sure.
OL: The last time they played this course?
MB: In 2006. Tiger won by two shots over Chris DiMarco. It was a totally different golf course that year. There was a drought, it was baked out, he was playing the whole thing with a 2-iron off the tees because the ball went a mile. This year the course is a little bit more lush.
OL: The brown British Open courses are kind of cool. Assume it’s a links-style course.
MB: Yeah, you’ll get wind, you’ll get weather -- if you tee off in the morning, typically the weather’s a little calmer, the wind is down, and if you tee off in the afternoon, it can get a little crazy, and a lot of times it literally comes down to the luck of the draw. If you get an early-morning tee time and the weather is calm, and then it happens to be calm in the afternoon the next day you’re in great shape, and it’s totally luck. You play against the elements as much as you play against the golf course.
OL: What are the greens like there? Are they heinous or are they manageable or...?
MB: No, they’re very manageable. The British Open greens are pretty flat but they’re huge. They’re huge because, as we were talking about, the weather can be such a factor that just getting your ball on the green -- you can be a hundred feet away from the hole and have a putt at it. If you were a hundred feet away from the hole at a U.S. Open, you are in the rough or in a bunker. So lag putting will be a huge key. The guy who three-putts the least is usually the guy who’s going to win.
OL: So who’s looking good?
MB: Justin Rose is looking very good because he just won Tiger Woods’s event, the Quicken Loans National at Congressional -- the one that Tiger played in and missed the cut -- and then he just won the Scottish Open. He’s won back-to-back, which, in fact, may make it all that much more unlikely that he’ll win the British because winning three in a row is unheard of. But he is definitely the hottest player in golf right now and he’s favored to win the event if you talk to people in Las Vegas.
Adam Scott (the PGA’s No. 1 ranked player) has not played since the U.S. Open. He has basically gone to prepare for the British Open ever since the U.S. Open (which ended June 15). So Adam Scott is definitely a guy to watch as far as being focused on this.
The Phil question -- defending champion Phil Mickelson has had a very erratic season and was asked how he felt about his season and he didn’t seem too upset about it. It was an interesting comment from him. It makes you wonder how much he’s focused on winning.
OL: There’s some other big name playing, right?
MB: Uh, yeah. Tiger Woods is...in the field. You won’t have to look hard to see him because ESPN is launching the ESPN3 network during the British Open, also known as Tiger Woods TV. They’re going to have every single shot and every move that he makes -- for at least two rounds -- on ESPN3, which is online. In those first two days you might have more people watching an online feed of golf than watching the actual golf on ESPN.
Tiger Woods’s chances? It’s funny -- ‘Can he win?’ used to be the story, now the story has evolved into, ‘Can he at least make the cut?’
OL: Do we have any sense that he’s in any better shape after those two rounds at Congressional?
MB: Other than what he tells you, which is that his back has never felt better. That might be the case, his back might feel fine, but it’s a question of how is his swing coming along. Based on what we saw at Congressional, which is the only way to gauge where he’s at, he is a long way from contending.
U.S. economic indicators today include initial jobless claims and housing starts at 8:30 a.m. EDT, Bloomberg consumer comfort at 9:45 a.m. and the Philly Fed business outlook at 10 a.m.
Earnings are in full swing. Highlights before the market opens are Morgan Stanley, Fifth Third, Blackstone Group and KeyCorp, Baker Hughes, PPG, Philip Morris and Mattel. After the bell comes Capital One, IBM, Schlumberger and Google.
+ The job cuts forecast for Microsoft appear likely to come today. + Ukraine-related sanctions on Russian banks, energy companies and defense companies were announced by the U.S. and EU, sending Russian stocks and the ruble tumbling. + We’re in the middle of a five-hour cease-fire between Hamas and Israel that’s due to end at 8 a.m. EDT., after which Israel will probably invade Gaza. + Volkswagen has explored a bid for Fiat Chrysler, according to Manager Magazin. + Rupert Murdoch, if history is any guide, will own Time Warner Inc. soon. + QE is unlikely anytime soon at the ECB, Governing Council member Ardo Hansson says. + A second Chinese corporate-bond default, this time by a builder who may fail to make payment on both interest and principal. + Digital currency backed by physical gold has been created by precious-metals dealer Anthem Vault. + John Malone’s Liberty Global bought a stake in ITV from BSkyB for $824 million. + NYC traffic alert: Obama will be arriving in NYC today at the afternoon rush hour on his way to a fundraiser for Democratic candidates for the House. + Xi Jinping begins a trip to Brazil, Argentina and Venezuela. + Francois Hollande begins a trip to the Ivory Coast, Niger and Chad. + Regina Egea, Christie’s chief of staff, is scheduled to testify before a New Jersey legislative panel investigating the George Washington Bridge scandal at 10 a.m. EDT in Trenton. + Mary Barra, Anton Valukas and Ken Feinberg give testimony on GM’s recall disaster to a Senate subcommittee at 10 a.m. in Washington. + The U.S. Senate Appropriations Committee votes on fiscal 2015 funding for the Pentagon. + Estimated cocoa grindings for North America are reported by the National Confectioners Association. New York cocoa has risen by almost a third in the past year. + Goldman Sachs will hold its annual meeting in Germany, where the party is still raging. + Look for Joe Torre on Bloomberg TV this morning at 8:30 a.m. EDT
The mostly blasé attitude toward cyber warfare in the U.S. is pretty much a ticking time bomb, but what Bloomberg Businessweek reports today ought to -- ought to -- raise the level of concern to Defcon 1 because what we’re all learning is that the bomb almost went off.
The outstanding reporting by the weekly magazine people reveals that in December 2010 the presence of a malware virus was detected in Nasdaq’s central servers and that it wasn’t just any little hack but a bit of attack code.
As Michael Riley reports for the magazine, this variant is, as they say, almost unheard of. It brings the kind of destruction that was used in the Stuxnet worm to hobble Iran’s nuclear-enrichment program that same year. The story says one U.S. official said he’d only seen it once -- in Nasdaq.
What ensued was a five-month investigation that directly involved President Obama. Bloomberg Businessweek spent months conducting interviews to piece together the story, including speaking with House Intelligence Committee Chairman Mike Rogers, the Michigan Republican, who agreed to discuss the event in general terms.
The story recounts how one official who experienced the attack firsthand thought it would finally be the impetus for taking the issue seriously.
That was four years ago. Since then, efforts to bring business to the table over the issue has gone nowhere, predictably over the burdensome cost. How much expense do we think we would have been looking at if that attack had succeeded? Here’s where things stand: Senate Bill 1353: Cybersecurity Act of 2013, which was introduced one year ago next week, has gone absolutely nowhere.
There’s a good bit of irony in the notion that one side of law enforcement in New York is beginning an era of prosecution for the supposed theft of technology that another arm of law enforcement in New York is examining for potential abuse of fairness in the markets.
Of course, we’re talking about high-frequency trading.
The computer programming and algorithms at the heart of trading strategies today is then at the heart of a firm’s success, according to those who are prosecuting programmers for leaving, or attempting to leave, with their secret sauce.
As Michael Lewis reported for Vanity Fair last September, at the debut of his descent into the realm of HFT before his book “Flash Boys” brought the topic to the tip of all our lips, there’s a lot of gray area in the topic.
He told the story of Sergey Aleynikov, who was arrested, convicted and jailed on federal charges for stealing code from Goldman Sachs before his conviction was successfully appealed. Then Manhattan District Attorney Cyrus Vance Jr. arrested him, and he’s awaiting trial. He pleaded not guilty.
Traders leave one shop for another all the time, taking their knowledge, Rolodexes and client base with them. But when computer programmers who helped create the recipe for a firm’s secret sauce try to leave with the equivalent asset, what they take with them is increasingly claimed by their employers, identified as intellectual property or somesuch, and they’re jailed.
Chris Dolmetsch and Tiffany Kary find today that Wall Street is now more than willing to bring a criminal case when an employee from the technical side of the business resigns with work he or she produced, or didn’t; that a judge involved in at least one of the prosecutions is dubious about their criminality; and that the rules of engagement have changed.
“Something just doesn’t ring right in this case,” said the doubtful judge, Jeffrey K. Oing of New York State Supreme Court, who said he’s handled lawsuits against former Wall Street employees accused of taking trade secrets or client lists. “None, none of them have ever risen to a level of a criminal indictment.”
A beloved editor of ours from the early years, who recently departed us, imparted a journalism lesson we’ve kept ever since. It was about using the word “historic.” His point was that using it on the day of a piece of news is usually poor form because only history decides what’s historic, and the news just happened.
We’re disregarding his advice today because General Electric’s decision to sell its appliances business, to us, makes the cut. This is the business that made the company, and it’s an historic move.
To think of the iconic components to this story is to conjure America’s mightier past, days of Thomas Edison and J.P. Morgan -- the guy, not just his bank -- and how we became, in part, what we became over here: a light bulb for modernization and innovation that elevated households and standards of living in the first half of the 20th century.
There are other brands of toasters and refrigerators and washing machines, all just as good more or less, but none is stamped with that generic name that became an avatar for American ingenuity.
Tony Gallopin won yesterday’s 11th stage of the Tour de France, pulling away in the final 2.5 kilometers (1.5 miles). The Frenchman who held the yellow jersey briefly on July 14 remains 3 minutes 12 seconds behind Vincenzo Nibali, who continues to lead Richie Porte by 2’23.
But that’s not the story of yesterday’s stage.
The captain of the Garmin-Sharp team, Andrew Talansky, finished the stage when all laws of psychology and physiology say he probably should not have. It was a deeply emotional scene as he contemplated abandoning, sitting on a guardrail crying as he spoke with his team’s director, while the race, including his own team, had given up on him.
No athletes are this tough. Cyclists make hockey players look like baseball players. It was incredible courage that Talansky showed.