Blog Posts by Aaron Task

  • [$$] Court Denies Arrest Warrant for Samsung Heir Lee Jae-yong

    SEOUL—A South Korean court denied an arrest warrant for Lee Jae-yong, the scion of the Samsung conglomerate, for his alleged involvement in a national corruption scandal, the latest twist in a saga that has shaken the country’s political and corporate establishment.

    The Seoul Central District Court early Thursday rejected prosecutors’ application to detain Mr. Lee, saying that it had difficulty “seeing the reason, necessity, and appropriateness of an arrest at this stage,” adding that there wasn’t a sufficiently strong basis to establish a bribery charge based on current investigations.

    The court’s decision keeps Mr. Lee, the de facto head of the Samsung conglomerate, out of detention as the broader probe continues.

    The move also throws some cold water on the special prosecutor’s investigation into allegations of bribery, embezzlement and perjury against Mr. Lee, which had been gaining momentum quickly in recent days.

    A

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  • [$$] Deutsche Bank Stops Senior Bankers’ Bonuses for 2016

    FRANKFURT—Deutsche Bank AG said Wednesday that many managing directors and other senior employees won’t receive individual bonuses for 2016, reflecting higher legal costs and other hits on the bank’s profits.

    The German lender’s management board said in a memo to employees that “tough measures are unavoidable” because the bank is cutting thousands of jobs and withholding dividends from shareholders.

    Anticipated bonus cuts have fueled concerns in recent weeks about a loss of talent from Deutsche Bank, employees, recruiters and rival bank executives said. Analysts and investors have wanted Deutsche Bank to balance limiting pay while holding on to bankers, traders and other staff who drive profits.

    The bonus issue is far from clear-cut, though. Deutsche Bank didn't provide total 2016 pay figures or say how much money the cuts would save the lender. Executives will provide more details when they report year-end financial results including compensation

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  • Finance Watch

    Discount brokerages are hoping President-elect Donald Trump keeps things interesting with his tweets after he takes office.

    In the weeks since Mr. Trump’s election, discount brokerages have seen a jump in trading activity among their clients—day traders and mom-and-pop investors, among others—pushing commission revenue higher at a time when brokerage firms have struggled to boost trading fees.

    “Just the social-media presence of the president-elect has an unambiguous effect on our business, which is making commissions every time somebody makes a trade,” TD Ameritrade Holding Corp. Chief Executive Tim Hockey said in an interview with The Wall Street Journal. “When statements are made by the most powerful man on the planet, then that drives investors and traders to take a position based on that tweet.”

    TD Ameritrade said it saw an average 487,000 client trades a day in the quarter ended Dec. 31, 11% more than in the year before and the company’s

    Read More »from Finance Watch
  • [$$] FCC’s TV Airwaves Auction Nears End With About $18 Billion in Bids

    The Federal Communications Commission’s auction of television airwaves is wrapping up after attracting about $18.2 billion in bids, far less than the last sale of government licenses amid weaker demand.

    The complex process freed up spectrum from local TV stations so it could be repurposed for cellular use. But analysts said bidders likely weren’t as interested in the low-frequency television airwaves compared with other airwaves that can carry more data over shorter distances. Participants are barred from talking about the auction.

    Overshadowing the results was the surprising success of the previous FCC auction that closed in early 2015 with almost $45 billion in bids. That high bar had some industry observers thinking this auction might be even bigger but it ended up being less than half that size.

    “It may also be the case that the sobriety in the current auction reflects the fact that the carriers’ balance sheets are stretched to the breaking

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  • Brent Callinicos helped Uber Technologies Inc. raise billions of dollars as its financial chief. Now he will assist Hyperloop One Inc. with one of tech’s most ambitious and costliest ventures, developing a transit system that can shuttle people in tubes at supersonic speeds.

    Hyperloop is elevating Mr. Callinicos to become both its operating and financial chief, an expansion of his prior job as chief financial adviser. The company is replenishing its ranks after losing several executives including its co-founder and chief technology officer, Brogan BamBrogan, over a dispute that spilled into court.

    Los Angeles-based Hyperloop is seeking to develop what is essentially a magnetic levitation train that floats slightly above the ground, transporting cargo and people in low-pressure tubes. It is an idea that stemmed from billionaire inventor Elon Musk who in 2013 challenged entrepreneurs to commercialize technology that he said could transport

    Read More »from [$$] Hyperloop One Elevates Brent Callinicos to Operating and Financial Chief
  • [$$] Outgoing Canadian Pacific CEO and Activist Investor to Target CSX

    Hunter Harrison, the railroad veteran who announced his early departure from Canadian Pacific Railway Ltd. Wednesday, is joining with an activist investor in an attempt to shake up management at rival railroad CSX Corp.

    Mr. Harrison, 72 years old, said he is completing an agreement to team up with Paul Hilal, who left William Ackman’s Pershing Square Capital Management LP to launch his own fund last year. They are expected to try to put Mr. Harrison in a senior management position at CSX, which CP approached about buying last year and in 2014, according to people familiar with the matter.

    Mr. Hilal’s fund, Mantle Ridge LP, has raised more than $1 billion for a single investment, according to a person familiar with the matter. Investors have committed to locking up their money in the fund for five years, the person said.

    “We are close to a deal to potentially look at some opportunities,” Mr. Harrison said in an interview.

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  • [$$] Wall Street Gets Back Its Groove

    The historic U.S. election jolted Wall Street trading desks, buoying investor confidence and sparking activity that pushed the five biggest U.S. investment banks to sharply higher fourth-quarter profits.

    The performance marks what could be a turning point for banks after a fallow period that had some worried the trading business—the lifeblood of Wall Street and its billion-dollar bonus pools—was dying for good.

    Goldman Sachs Group Inc. and Citigroup Inc. reported quarterly earnings Wednesday that beat analyst expectations and grew from a year ago, thanks to a resurgence in long-challenged trading businesses.

    Citigroup’s $3.7 billion trading haul was its best fourth-quarter showing since the financial crisis. J.P. Morgan Chase & Co., which reported its results last week, had its best fourth-quarter for trading ever.

    “There was increased optimism around the world,” said Harvey Schwartz, chief financial officer at Goldman,

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  • [$$] Pearson Shares Dive on Profit Warning

    LONDON—Shares in Pearson PLC plunged Wednesday after the world’s largest education company warned of weaker earnings and a possible dividend cut and said it plans to sell its stake in book publisher Penguin Random House.

    Pearson singled out continuing declines in North American sales of higher-education course materials for its worsening prospects. Overall, the company said its revenue fell 30% in the fourth quarter, capping a full-year decline of 18% that it called unprecedented.

    Growth in employment and increasing education regulation has reduced higher-education enrollments in the U.S., which has put pressure on Pearson’s business even as it seeks new sources of growth in emerging economies such as Brazil and China. Pearson is also grappling with a difficult transition to digital formats from print for many of its higher-education products.

    “There is no getting around how tough it is,” Chief Executive John Fallon said of the education sector in a

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  • [$$] Target Issues Profit Warning on Disappointing Holiday Sales

    Target Corp. warned of weak profits and sales during the critical holiday period, the latest retail chain to acknowledge its struggle to attract shoppers to its stores and compete with online sellers such as Amazon.com Inc.

    Sales at Target stores open at least a year fell 3% during November and December. The company said online revenue jumped more than 30%, but still accounted for just a fraction of its total business, so overall comparable sales are expected to fall for the quarter.

    Digital gains were offset by “disappointing traffic and sales trends in our stores,” and web discounting ate away at the company’s profit margins, Chief Executive Brian Cornell said on Wednesday.

    Target’s warning follows a string of announcements by fellow brick-and-mortar retailers this month, such as Macy’s Inc., Barnes & Noble Inc., J.C. Penney Co. and Kohl’s Corp., citing lackluster holiday sales.

    Some companies, including Sears

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  • [$$] More Bureaucracy Isn’t the Answer for Ethics

    Regarding your editorial “Fake Ethics Reform Fiasco” (Jan. 4): The fact that your main lesson from this “fiasco” is that the GOP should not bend to liberals ignores reality. Many GOP representatives cited their constituents’ phone calls as the reason they pulled their support for the reform. This shows that the voters who demanded that members of Congress be accountable are still able to influence their representatives. Take it as a win for democracy and grass-roots mobilization, not as a loss for the GOP. It is not the job of your paper to decide if the outcry was “fake.” It is the job of the voters, and they spoke with one voice to say they would not tolerate this lack of accountability.

    Evan Weinstein

    Tuckahoe, N.Y.

    Although the president-elect is correct that Republicans in Congress have more important things to do than simplifying the byzantine levels of House ethics

    Read More »from [$$] More Bureaucracy Isn’t the Answer for Ethics

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