Weil on Finance: EBay’s Icahn Bounce
Hello, View fans! Here’s a look at what I’ve been reading.
Amazing. Icahn bought a 0.82 percent stake in EBay Inc. and thinks he should get two of his employees on the company’s board just by nominating them. (And maybe he can.) Then he went on TV to talk about it. So naturally the stock went nuts in extended trading yesterday. He says EBay should spin off PayPal. Here’s what I wonder: Has he ever used PayPal to pay for anything on EBay? Operationally speaking, this was one of the most seamlessly integrated corporate acquisitions ever. Lots of EBay customers wouldn’t buy anything there if they couldn’t use PayPal. It makes sense that EBay wants to control PayPal completely. There are real synergies. Anyway, EBay made clear it thinks this is a bad idea. Free advice: Don’t invite Icahn over for dinner unless you want him to tweet about it.
This was the subject of a column I wrote last week. Forbes contributor John Wasik is a kindred spirit: “What if you wanted to know who were the worst brokers, that is, the ones with the most infractions, customer complaints or regulatory sanctions? Although you can search individual names and firms on Finra’s BrokerCheck system, neither Finra, nor the SEC, have a list of the worst actors. And if they do, they are not publishing it. `Bad’ lists abound. We have `worst’ cars, movies, restaurants and even doctors. But have you ever seen a `worst’ brokers list? Since there’s a revolving door between the SEC and Wall Street -- and Finra is financed by the brokerage industry -- this shortcoming won’t surprise you.”
From the Southern Investigative Reporting Foundation: “Bryan Caisse, the former submarine weapons officer turned hedge fund manager, was arrested Saturday in Bogota, Colombia, by officers from the Department of State’s Diplomatic Security Service. His name should ring a bell for Southern Investigative Reporting Foundation readers: Caisse was the subject of a December report detailing how the once well-regarded mortgage-bond fund manager disappeared from New York in the autumn, leaving both a daughter and numerous investors from his fund behind and in the dark.”
Even if you detest Google Glass, you gotta feel for this guy.
I know the glasses are creepy, and copyright violations are a big deal. But calling the feds on somebody for wearing Google Glass in a movie theater? It seems a bit much. This comes from John Biggs at TechCrunch: “While some businesses are banning the high-tech wearable device Google Glass, a theater owner in Columbus, Ohio, saw enough of a threat to call the Department of Homeland Security. The manager called in unnamed Homeland Security agents to remove a Balkan programmer who was wearing Google Glass connected to his prescription lenses. The agents and mall police interrogated the Glass-wearer for hours.” They let him go once they figured out he wasn’t recording the movie. I can see the new risk-factor disclosure in Google’s next annual report already: “We may experience negative publicity because many people are freaked out by the sight of someone in their general vicinity wearing Google Glass.”
Chinese investors are finally getting nervous about wealth-management products.
One of the investment products, a $496 million trust that raised money for a coal-mining company that collapsed after its owner was arrested, comes due Jan. 31. Investors are demanding their money back from Industrial & Commercial Bank of China, which was the trust’s issuer, and others, including the government of Shanxi province. It looks like they may get a bailout.
The first link takes you to a remarkable article by the International Consortium of Investigative Journalists, whose reporters got a huge batch of records revealing the offshore holdings of China’s ruling elite. The second link is to an administrative-law judge’s ruling yesterday at the Securities and Exchange Commission. The judge suspended all of the Big Four accounting firms’ China affiliates from auditing U.S.-listed companies for six months, which might create big problems for lots of companies if it ever takes effect. Whether it does won’t be up to the judge, though, because the commission can still overturn the decision if it wants to.
(Jonathan Weil is a Bloomberg View columnist. Follow him on Twitter.)