Editor’s Note: A day late this week, our apologies.
BUZZWORDS
THAT YOU SHOULD BAN IN 2014 – “Moving forward”, “Proven
alignment”, “Leverage”, “Alpha”, “Transparency”, De-layering”, “Viral”, “Reach
out”, “Incentivize”
People who use these buzzwords have no idea what they mean
and what context they should be in. Nice excuses for leaders to veer from their
strategy and not stay focused on the few key things they truly create and
manage.
NEW ERA
TO BEGIN - Regulators are set to usher in a new era of tough banking
oversight in 2014 that drills to the core of Wall Street's profitable markets
and trading businesses, according to a draft ... The so-called Volcker rule
will put in place new hurdles for banks that buy and sell securities on behalf
of clients, known as market making, and will restrict compensation arrangements
that encourage risky trading ... Five U.S. financial regulatory agencies are
expected to approve the rule, which bans banks from making bets with their own
money and limits their ability to invest in certain trading vehicles, such as
hedge funds and private-equity vehicles.
The approval would bring to an end a 2½-year effort to
complete the 2010 Dodd-Frank provision. The final language of the Volcker rule
could change before Tuesday's vote. Regulators have told firms that they don't
expect to strictly enforce the rule's provisions until 2015. ... The rule,
which hasn't been publicly released, will require banks to provide
'demonstrable analysis of historical customer demand' for financial assets they
buy and sell on behalf of clients. That essentially requires a firm to prove it
has engaged in a certain type of trading previously. It is an effort to keep
banks from attempting to disguise bets made for a profit - so-called
proprietary trading, which would be banned - as permissible market-making activity.
DEBT
CEILING - Treasury says it must be raised by late February or early
March. The Congressional Budget Office says as late as June. Either way,
Congress must raise the borrowing limit and Republicans will demand something
in return. Consensus among Beltway insiders and Wall Street executives is that
with the focus shifting to the midterm elections and everyone fearful of
fallout from a big fight, a deal will get made that offers Republicans
something on spending while not pushing the nation to the brink of default. ...
It's not at all clear what this deal will look like but M.M. does not believe a
fresh debt limit crisis is likely. So don't let fear of default ruin your
Christmas or New Year's.
MID-TERM
ELECTIONS - The Baucus-to-China move upends conventional wisdom that
Republicans have a good shot at taking control of the Senate. The GOP needs six
seats and now both Montana and Louisiana seem like less likely pick-ups.
Montana Lt. Gov. John Walsh will now likely to be able to run for Baucus' seat
as the appointed incumbent. And in Louisiana, Sen. Mary Landrieu will now
likely take the gavel of the Energy Committee if Wyden moves to Finance. That
would give her significant ability to boost Louisiana drilling interests and
make her defeat less likely.
On the House side, the Democrats have essentially zero
chance of regaining control. They would need a net gain of 17 seats, a near
impossibility given the number of competitive districts and the historic
tendency of the incumbent president's party to lose seats in the sixth year of
the president's term. An improving economy might boost Democrats' a bit. But
that would probably just serve to limit GOP gains. The safest bet right now is
that Washington at the end of 2014 will look much as it does now.
COMING
ATTRACTIONS - Books, TV, movies to watch for in 201 : Former
Secretary of State Hillary Clinton's as-yet-untitled new memoir will focus on
American foreign policy using 'a number of dramatic moments' such as the killing
of Osama bin Laden and the Arab Spring ... Glenn Greenwald's upcoming book, 'No
Place to Hide: Edward Snowden, the NSA, and the U.S. Surveillance State' ...
Robert Gates's book 'Duty: Memoirs of a Secretary at War' ... New York Gov.
Andrew Cuomo ['s book] will be a 'full and frank look at his public and private
life' ... Texas state Sen. Wendy Davis ... is penning a memoir ... of how she
went from single mom to gubernatorial candidate. ... Gabriel Sherman[s] 'The
Loudest Voice in the Room: How the Brilliant, Bombastic Roger Ailes Built Fox
News-and Divided a Country' ... will be out January ... Sen. Elizabeth Warren
... will release a still-untitled autobiography in spring ...
Glenn Beck's next book, tentatively titled 'Controlling
Education,' will be the follow-up to his New York Times bestseller, 'Control:
Exposing the Truth about Guns.' ... Michael Hastings wrote a novel titled 'The
Last Magazine' before he died in a car accident in June ... Michelle Malkin's
fifth book, tentatively called 'Who Built That: The Tinkerpreneurs Who Built
Everything From the Bottle Cap to Bridges' ... 'Good Morning America' co-host
Robin Roberts is set to release a memoir chronicling her battle with
myelodysplastic syndrome
THE
YEAR AHEAD - "Europe unity tested on WWI centenary," by
AFP's Laurent Maillard in Paris : "Commemorations for the 1914-18 Great
War are planned through the summer on either side of the Western Front, but
with no single event bringing all of the former foes together. ... For the
British and French, World War I is vividly etched in the collective imagination
as a just and necessary victory, secured at a terrible human cost. ... In
Germany and Russia, by contrast, the Great War's memory was all but supplanted
by the cataclysm of World War II, two decades later. The centenary also comes
as the very idea of a shared European future is under attack, with
eurosceptics, nationalists and the far-right gaining ground across the
continent as the eurozone heads into a fourth year of economic crisis."
From smartphones to tablet computers and mobile apps, Google
and Apple have been competing head-to-head for digital supremacy. The next
battlefront: the automobile. Just a few months after Apple launched an
initiative to integrate iPhones and other devices running its iOS operating
system with dashboard control panels, we report that Google and German auto
maker Audi plan to announce next week that they are working together to develop
in-car entertainment and information systems, as well as collaborating with
other tech and auto companies. The aim: to allow drivers to access features
similar to those available on Android-powered smartphones. "The car is
becoming the ultimate mobile device," said a research analyst.
"Wall St. ends best year since 1990s with moderate
gains," by Reuters' Ryan Vlastelica: "The S&P 500 rose 29.6
percent over the year, its best annual performance since 1997, while the Dow
climbed 26.5 percent in its best year since 1995. The Nasdaq jumped 38.3
percent, its best year since 2009. Both the Dow and the S&P 500 finished
the final trading day of 2013 at record closing highs."
GOLD
FALLS FROM FAVOR -- Commodities Post First Drop in 5 Years as
Corn to Gold Tumble: Commodities posted the first annual drop in five years as
supply exceeded demand for corn to sugar to nickel and investors lost faith in
precious metals as a store of value amid signs that economies are improving.
... Gold marked its first annual drop in 13 years with a 28 percent slide and
silver slumped 36 percent.
GENEROUS
ZUCK
- Chronicle of Philanthropy's Maria Di Mento: "The largest [2013
announced] donation came from Mark Zuckerberg and his wife, Priscilla Chan. The
couple ... provided 18 million shares of Facebook stock, valued at more than
$990-million, to the Silicon Valley Community Foundation. ... [The gift] sets a
... record because it [is] the first time donors that young have made the
[year's] biggest contribution."
GET
SMART FAST: 2014 DATES TO WATCH - POLITICO's James Hohmann
rounds up some of the key moments to watch this year: "Mark your
calendars, and buckle up: 2014 is an election year with control of the Senate,
House and 36 governorship's at stake. ... The battle for the soul of the GOP
will intensify, while the economic recovery faces its own challenges. ... Here
are POLITICO's top 14 dates to watch in 2014. ...
Jan. 28 - State of the Union: "Obama becomes more of a
lame duck with each annual update to Congress, and, faced with strong
Republican opposition, it's likely many of the priorities he outlines will go
nowhere. ...
Late March-June - Raising the debt ceiling:
"Highlighting ... debt is a winning issue for Republicans, but flirting
with economic catastrophe is not. Obama again insists he will not negotiate.
Some conservatives think that Republicans must push for concessions, and other
Republicans believe that going to the brink will scare major donors and spook
independents"
March 31 — Obamacare D-Day
This is the end of the enrollment period for the first year
of the new Obamacare exchanges, the last date people can buy insurance to avoid
paying a penalty on their 2014 taxes. We’ll finally know how many people signed
up for health plans under the law in the first year.
It will be a key messaging opportunity for proponents of the
Affordable Care Act to talk about the benefits of reform and for detractors to
highlight the problems with the rollout.
HITTING THE JACKPOT - The Las Vegas Strip, synonymous with gambling, isn't the
casino capital of the world. That title belongs to Macau, the only place in
China where casino gambling is legal. Our story takes a look at the rise of
Macau—how it went from a smattering of casinos to a booming gambling
destination. We find that while the Chinese territory has been hitting the
jackpot for the past few years, the Strip and Atlantic City are struggling to
recover from the financial crisis. The Las Vegas Strip's revenue in 2013 was
likely down to only about one-seventh that of Macau. We also note that Macau
has become the fastest-growing economy in the world, but has yet to achieve the
status of Las Vegas in global popular culture.
BIRTHDAYS
THIS WEEK – Birthday wishes and thoughts this week to: Jeff Bezos
(50), Nicolas Cage (50), Katie Couric (57), George Foreman (65), Stephen
Hawking (72), Nancy Lopez (57), Jimmy Page (70), John Rich (40), Frank Sinatra,
Jr. (70), Bart Starr (80), Howard Stern (60).
WILL
THE ECONOMY BREAK OUT? - Friday's big GDP surprise saw third
quarter growth hit 4.1 percent, driven in part by increases in consumer and
business spending, very hopeful signs that the economy is gaining traction. And
the good data come after some other positive developments. Washington managed
to agree on a budget deal to all but erase the threat of a government shutdown
next year. And the Fed gave the economy a big vote of confidence by saying it
would start cutting back on emergency stimulus.
And instead of freaking out, markets embraced the news and
decided the taper was mild enough not to choke off growth. Investors also
embraced the many caveats from Ben Bernanke that the central bank would keep
rates at effectively zero well into the future and could resume other stimulus
if needed.
Job creation rates, consumer balance sheets, house prices
and confidence levels all suggest a strong year. We asked on Twitter for some
bold predictions for 2014 (more on which below). Justin Wolfers, one of the
nation's leading economists, came up with this huge call:
"The economic recovery finally gathers momentum. And
unlike others, I haven't said this for each of the past five years." As
BI's Joe Weisenthal would say: BOOM. Citi's Peter Orszag followed up Wolfers'
Tweet: "Me too, on both counts."
SUPER
BOWL ADS ... a record $4M for 30 seconds: Laurence Fishburne, the
straight-faced star of the 1999 hit sci-fi film 'The Matrix,' will show up with
a humorous twist on the cult classic in a Kia ad ... Wonderful Pistachios ...
will feature ... Stephen Colbert in two 15-second ... commercials. ... Dannon
and Chobani ... will go toe-to-toe ... Jaguar will appear in its first-ever
Super Bowl to tout its new F-Type sports coupe ... Several other first-time
advertisers[:] Nestle is using the Super Bowl to promote the national roll-out
of its new Butterfinger Peanut Butter Cup. Intuit ... will feature its small
business contest winner ... Cheerios -- which went out on a limb with a
much-discussed interracial family TV ad last spring -- will do with its
first-ever Super Bowl ad.
COLLEGE
FOOTBALL PICK OF THE WEEK – A great season has come to an
end with Florida State University winning the BCS Title game in Pasadena. Final Season totals (13-6)
COLLEGE
HOCKEY PICK OF THE WEEK – Saturday 1/11, 8:00 PM ET, FSW; #8 Michigan
Wolverines (10-4-2) at #14 Wisconsin Badgers (11-6-1). Rink Rats College Hockey
season now begins, a great first game. We like Michigan to pull the upset in
Madison, 4 -2.
NFL
PICK OF THE WEEK – Saturday 1/11, 8:15 PM ET, CBS: Indianapolis
Colts (12-5) vs. New England Patriots (12-4). This game will be closer than you
think, Pats 35 Colts 31. Season to date
(13-4)
THE
SWAMI’S WEEK TOP PICKS –
(NFL Playoff, Jan 11) New Orleans Saints (12-5) 14
at Seattle Seahawks (13-3) 28
(NFL Playoff, Jan. 12) San Francisco 49ers
(13-4) 27 at Carolina Panthers (12-4) 24
(NCAA Hockey, Jan. 11) Harvard Crimson (5-7-2) 2
at #10 Yale Bulldogs (7-3-4) 6
(NHL, Jan. 12) Detroit Red Wings (19-14-10) 2
at Anaheim Ducks (31-8-5) 5
(NFL Upset of the Week, Jan. 12) San Diego Chargers
(10-7) 24 at Denver Broncos (13-3)
20
2014 Season
Final (1-4)
DRIVING
THE WEEK - Welcome to the first jobs week of 2014. Reading on
December employment, out Friday at 8:30 a.m., expected to show a gain of 195K
with no change to the 7.0 percent jobless rate. However, there is a decent
chance unemployment drops below 7 percent for the first time since November of
2008 ... ISM non-manufacturing this morning at 10:00 a.m. expected to dip to
54.5 from 55 ... Factory orders today at 10:00 a.m. expected to rise 1.7
percent ...
FOMC minutes at 2:00 p.m. Wednesday will offer some insight into how close the call was on tapering asset purchases ... ADP private
employment at 8:15 a.m. Wednesday expected to show a gain of 200K ... Both
Congress and President Obama are back in DC with Dems set to push for an extension of expired emergency jobless benefits ... Consumer Electronics Show
takes place in Las Vegas.
Next
week: Dear Rink Rats and NHL Power Ratings.
Until Next Monday, Adios.
Claremont, CA
January 7, 2014
#IV-38, 195
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