QUOTE OF THE DAY
“This has become one of the most serious and devastating diseases our pig farmers have faced in decades.”
Karen Richter, National Pork Board president Article, 1D
Judge orders ex-trader to pay $825,000
NEW YORK - A former Goldman Sachs trader dubbed “Fabulous Fab” has been ordered to pay about $825,000 in a securities-fraud case stemming from the 2007 mortgage crisis that helped push the country into recession.
A federal judge in Manhattan issued the ruling Wednesday in the civil case against Fabrice Tourre. He was found liable after a trial last summer.
His lawyer didn’t immediately return a call seeking comment.
The Securities and Exchange Commission said Tourre misled institutional investors about subprime mortgage securities that he knew were destined to fail. SEC lawyers called him a symbol of “Wall Street greed.”
His attorneys depicted him as a scapegoat for the financial crisis.
The SEC says the ruling reflects its intent of “pursuing meaningful sanctions” to punish and deter misconduct.
Buffett, Graham Holdings reach deal
WASHINGTON - Warren Buffett’s company said Wednesday that it has agreed to acquire a Miami-based TV station from Graham Holdings Co. in exchange for most of its shares in the company that once owned The Washington Post.
The deal will nearly eliminate Berkshire’s investment with the Graham family, which dates back to 1973 when Buffett invested $10.6 million in the Washington Post Co.
after the newspaper’s stock took a beating after the publication of its famed Watergate stories.
“While this transaction will greatly reduce our position in Graham Holdings, our admiration for the company and its management is undiminished,” said Buffett, who was a close friend with former Washington Post publisher Katherine Graham and advised the family on business matters.
Both Berkshire and Graham will receive assets worth roughly $1.1 billion in the deal, according to documents filed with the Securities and Exchange Commission Wednesday.
- The Associated Press
Hyundai World Cup ad perplexes VW
Brazil’s national soccer team sponsor Volkswagen AG says it contacted the country’s soccer federation for clarification over a promotion by Hyundai Motor Co. linked to the team’s performance at the World Cup tournament finals. The month-long event begins in Sao Paulo on June 12.
The soccer body, the CBF, has complained to the South Korean automaker over an advertising campaign that promises an extra year’s warranty to new-car buyers in Brazil should the team clinch a record-extending sixth World Cup. The CBF says it’s a misuse of the national squad’s intellectual property.
“Volkswagen Brasil is in contact with the CBF to clarify and resolve this issue,” Europe’s biggest carmaker said in a statement. Volkswagen said the company has since 2009 been the automotive partner of the Brazilian team, giving it exclusive rights to use the association in promotional activities and official communications.
Hyundai spokesman Meeyoung Song said the company isn’t commenting on the matter.
Measure sinks mortgage titans’ shares
Fannie Mae and Freddie Mac shares extended a slump Wednesday after leaders of the U.S. Senate Banking Committee announced long-awaited plans to dismantle the companies.
Shares of Fannie Mae, the Federal National Mortgage Association, fell 49 cents, or 12 percent, to close Wednesday at $3.54, after tumbling 31 percent Tuesday. Shares of Freddie Mac, the Federal Home Loan Mortgage Corp., fell 68 cents, or 17 percent to $3.36, after dropping 27 percent Tuesday.
The bipartisan measure, drafted with input from President Barack Obama’s administration, would replace the U.S.-owned mortgage financiers with government bond insurance that would kick in only after private capital suffered losses of at least 10 percent, Senate Banking Committee Chairman Tim Johnson, D-S.D., and Sen. Mike Crapo, R-Idaho, said in a statement Tuesday. The bill would require most borrowers to make down payments of at least 5 percent.
“This starts the ball rolling to get housing finance reform done,” said Jaret Seiberg, policy analyst at Guggenheim Securities LLC’s Washington Research Group. “This issue remains alive and kicking, and whatever happens in the next few weeks is going to tell us whether we get to the finish line or not.” - Bloomberg News
India’s industrial output beats forecast
MUMBAI, India - India’s industrial-production data have shown an unexpected uptick as elections loom in the world’s most populous democracy.
The numbers released Wednesday had industrial output inching up 0.1 percent in February from the same month last year. The result beat analysts’ predictions of a contraction.
Consumer inflation also eased in February but was still high at 8.1 percent.
The trends were welcome news for Asia’s third-largest economy. India’s lowest economic growth rates in a decade have coincided with soaring prices over the past year. They have made it difficult for the central bank to try to stimulate growth by cutting interest rates.
Still, the sputtering economy is likely to hurt the ruling coalition government led by the Congress Party heading into elections beginning April 7.
- The Associated Press
Bond manager predicts global growth
Pacific Investment Management Co., the world’s largest bond manager, said global economic growth will be steady over the coming 12 months because of asset purchases by central banks in 2013.
Economic output will expand in the range of 2.5 percent to 3 percent through March of next year, compared with 2.9 percent for the year ended Dec. 31, Saumil Parikh, a generalist portfolio manager at Newport Beach, Calif.-based Pimco, said in a report posted on its website Wednesday.
“The global economy will likely experience steady, broad-based growth in 2014 thanks in no small part to the extraordinary expansion in central bank balance sheets,” wrote Parikh
- Bloomberg News
Business, Pages 28 on 03/13/2014