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The Wall Street Journal - April 10, 2018

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DJIA 23979.10 À 46.34 0.2%
WSJ.com
TUESDAY, APRIL 10, 2018 ~ VOL. CCLXXI NO. 83
* * * * * *
NASDAQ 6950.34 À 0.5%
STOXX 600 375.30 À 0.1%
10-YR. TREAS. g 2/32 , yield 2.786%
OIL $63.42 À $1.36
GOLD $1,336.30 À $4.40
Business & Finance
T
he Justice Department
decided to allow Bayer’s
megadeal to acquire Monsanto after the firms pledged
to sell off additional assets to
secure antitrust approval. A1
Russian stocks plunged
in the wake of new U.S.
sanctions. Aluminum maker
Rusal lost half its value. B1
The NYSE opened its
doors to stocks listed on
rival exchanges, abandoning a decades-old policy. B13
Leucadia is selling assets
to focus more on financial
services and changing its name
to Jefferies Financial. B12
The OCC’s chief laid out
plans to ease the application
of banking regulations. B12
Apple said it achieved its
goal of powering its facilities world-wide exclusively
by renewable energy. B6
World-Wide
The FBI searched the office, home and hotel room of
Trump lawyer Cohen, seizing
records including those related to a payment to a former adult-film actress. A1, A4
Trump and his national
security team began laying
groundwork for a possible
military strike against Syria’s
Assad regime over a suspected
chemical-weapons attack. A1
Suspected Israeli jets
carried out a deadly missile
strike on a military base in
Syria that Israel has said was
used by Iranian forces. A6
China has installed military jamming equipment on
two of its fortified outposts
in the South China Sea. A1
North Korea’s Kim acknowledged for the first
time the prospect of a “dialogue” with the U.S. A16
Trump promised relief to
U.S. farmers caught up in his
administration’s burgeoning
trade dispute with China. A2
The CBO said that tax cuts
and spending increases will
lead to wider budget deficits
than previously projected. A5
The EPA was urged by
the government ethics office
to “take action” to address
any violations by Pruitt. A5
Florida Gov. Scott said
he is running for the U.S.
Senate seat held by Democratic Sen. Nelson. A3
U.S. authorities shut
down Backpage, a website
accused of fostering prostitution and sex trafficking. A5
Bill Cosby’s retrial on
sexual-assault charges
opened near Philadelphia. A3
CONTENTS
Banking & Finance... B12
Business News.. B3,7
Crossword............... A11
Heard on Street. B14
Life & Arts......... A9-11
Markets............. B13-14
Opinion.............. A13-15
Sports........................ A12
Streetwise................. B1
Technology.......... B4-6
U.S. News............. A2-5
Weather................... A11
World News. A6-7,16
>
s Copyright 2018 Dow Jones &
Company. All Rights Reserved
President Donald Trump, speaking in the Cabinet Room at the White House Monday, lashed out at an FBI raid of his attorney’s office.
FBI Raids Office of Trump Lawyer
President blasts ‘witch
hunt’ after search of
Cohen’s records over
Stormy Daniels payment
FBI agents searched the office, home and hotel room of
President Donald Trump’s longtime lawyer, Michael Cohen, on
Monday, seizing records including those related to a payment to a former adult-film actress, a person familiar with
the matter said.
The searches were executed
by the Federal Bureau of Investigation as part of a probe by
the U.S. attorney’s office in
Manhattan, which has opened
an investigation that is being
coordinated with the office of
special counsel Robert Mueller,
this person said.
Mr. Trump, in a meeting with
military leadership at the White
House on Monday evening,
called the raids a “disgrace” and
a “witch hunt.”
“It’s an attack on what we all
stand for,” said Mr. Trump, re-
By Erica Orden,
Rebecca Ballhaus
and Michael Rothfeld
ferring to the investigation.
The president criticized Mr.
Mueller’s team, calling it “the
most conflicted group of people” and said Attorney General
Jeff Sessions made a “terrible
mistake” by recusing himself
from the Justice Department’s
investigation into Russia’s alleged meddling in the 2016
presidential election.
Asked if he would fire Mr.
Mueller, Mr. Trump said: “We’ll
see what happens.”
“Many people have said, ‘You
should fire him,’” the president
said. He didn’t say whether he
intended to do so.
The multiple raids, all in
Manhattan, mark a significant
escalation in prosecutors’ interest in Mr. Cohen, who has
served as the president’s personal attorney for decades and
has described himself as Mr.
Trump’s “fix-it guy.”
Please see COHEN page A4
WASHINGTON—President
Donald Trump and his national
security team began laying the
groundwork Monday for a possible military strike against Syrian President Bashar al-Assad in
response to a suspected chemical-weapons attack that killed
dozens of civilians.
As at least one U.S. guidedmissile destroyer moved toward
the Syrian coast, Mr. Trump
said he was likely to make a
quick decision on whether to
strike after seeing jarring images of dead women and children felled in their homes.
“It will be met, and it will be
met forcefully—when, I will not
say,” Mr. Trump said Monday
evening before meeting with his
top military leaders.
Mr. Trump conferred with
cabinet members, then met top
military leaders and spoke to allies about a possible response.
A decision on whether to strike
Syria could come Monday night
or early Tuesday, he said.
During the day’s meetings,
Mr. Trump was “outraged” by
pictures of injured and dead
Syrian children, said one White
House official, a similar reaction
to the chemical attack in Syria
last year that triggered a U.S.
military strike. He was less interested in what type of chemicals were used in the attack
than who was responsible, and
Please see SYRIA page A6
Gerald F. Seib: Toxic cloud
over Trump-Putin ties.......... A4
Israel suspected in strike on
Syrian base................................. A6
Assad regime has bet on
brutal tactics.............................. A6
China Put Jamming Borrowers’
Bigger Burden U.S. to Allow Bayer’s
Monsanto Takeover
Gear on Two Islands
Low rates have led to higher
debt levels across Europe. B12
China has installed equipment on two of its fortified
outposts in the Spratly Islands
capable of jamming communications and radar systems, a
significant step in its creeping
militarization of the South
China Sea, U.S. officials said.
By Michael R. Gordon
in Washington and
Jeremy Page in Beijing
The move strengthens
China’s ability to assert its extensive territorial claims and
hinder U.S. military operations
in a contested region that includes some of the world’s busiest shipping routes.
The disclosure comes as
China is conducting what U.S.
officials described as its largest military exercise to date in
the South China Sea, maneu-
Candidates
Take the
High Road
i
i
vers that include the nation’s
first aircraft carrier as well as
air force and ground units.
A U.S. Defense Department
official, describing the finding,
said: “China has deployed military jamming equipment to its
Spratly Island outposts.”
The U.S. assessment is supported by a photo taken last
month by the commercial satellite company DigitalGlobe
and provided to The Wall
Street Journal. It shows a suspected jammer system with its
antenna extended on Mischief
Reef, one of seven Spratly outcrops where China has built
fortified artificial islands since
2014, moving sand onto rocks
and reefs and paving them
Please see CHINA page A2
BY BRENT KENDALL
AND JACOB BUNGE
Debt held at companies
and households as a
percentage of GDP*
170%
WASHINGTON—The Justice
Department decided to allow
Bayer AG’s megadeal to acquire Monsanto Co., valued at
more than $60 billion, after
the companies pledged to sell
additional assets to secure
government antitrust approval, according to people familiar with the matter.
An agreement in principle
between the companies and
the department, brokered in
recent days, marked a breakthrough in the U.S. review process of the deal, which had remained in limbo because of
Justice Department concerns
about the merger.
Monsanto shares rose more
than 6% after The Wall Street
Journal reported on the Justice
Department’s decision Monday,
Eurozone
165
160
155
U.S.
150
145
140
135
130
2004
2010
*Quarterly data through 3Q 2017
Source: Bank for International Settlements
THE WALL STREET JOURNAL.
China’s Xi vows more access
for foreign companies........... B3
Zuckerberg: ‘We Didn’t Do Enough’
and closed 6.2% higher.
Bayer Chief Executive Werner Baumann and Monsanto
CEO Hugh Grant recently met
with Justice Department officials in Washington to help secure an agreement, people familiar with the matter said.
The Bayer deal presented
the department with its second major merger decision under Trump administration
leadership, following its move
in November to challenge
AT&T Inc.’s acquisition of Time
Warner Inc., a case that is currently in trial.
Deal makers and investors
remain eager for more data
points on the administration’s
approach, but there does appear to be one common thread
between the two decisions. In
each transaction, the department’s antitrust division
Please see DEAL page A5
Struggling Cinemas
Go Luxe to Survive
i
Theaters add giant recliners and fine dining
to lure movie fans from Netflix and the couch
Behind-the-wheel
ads are popular
election gimmick
BY ERICH SCHWARTZEL
BY REID J. EPSTEIN
As if traffic wasn’t bad
enough, there’s millionaire Andy
Thorburn at the wheel of a
rented Ford SUV, cruising along
a Southern California freeway in
a congressional campaign ad.
Mr. Thorburn, a former insurance executive worth more
than $50 million, owns a Tesla
but the Ford rental better illustrates how he can simultaneously drive and grouse about
Washington, just like any grassroots constituent.
He belongs to a bipartisan
convoy of more than 40 incumbents and challengers who gab
and grip the wheel in campaign
Please see DRIVER page A8
MICHAEL REYNOLDS/EPA/SHUTTERSTOCK
U.S. stocks pared gains after powering higher for much
of the session. The Dow rose
46.34 points to 23979.10. B13
JIM LO SCALZO/EPA/SHUTTERSTOCK
China’s Xi promised foreign firms greater access to
the country’s financial and
manufacturing sectors. B3
Alibaba is leading a $600
million funding round in a
facial-recognition startup. B6
YEN 106.78
BY DION NISSENBAUM
AND MICHAEL C. BENDER
Zuckerberg will tell lawmakers that Facebook failed to
do enough to protect personal
data from misuse and will lay
out corrective steps. B1, B4, B5
PayPal has been offering
some customers the option
to add basic banking features
to their digital wallets. B1
EURO $1.2323
President
Vows Fast
Decision
On Syria
What’s
News
Novartis agreed to buy
gene-therapy firm AveXis
for $8.7 billion, aiming to
refresh its drug pipeline. B7
HHHH $4.00
CHECKING IN: Facebook CEO Mark Zuckerberg met with lawmakers
Monday on Capitol Hill ahead of his testimony at hearings starting
Tuesday on his company’s handling of user data. B1, B4, B5
SUN PRAIRIE, Wis.—The
past and future of moviegoing
can be found within one Madison, Wis., highway exit.
The abandoned Eastgate
Theatre, a 16-screen multiplex
where teenagers once lined up
on opening night, represents
the industry’s struggles. Today, there is an empty Pepsi
cup stuck in a dead tree outside and a neighboring Mazda
dealership uses the parking lot
to store new cars.
Three miles away, the new
Palace Cinema of Sun Prairie
features 14 auditoriums
equipped with recliners wider
than La-Z-Boys, large-format
screens and a restaurant that
serves entrees such as pesto
primavera pasta during mov-
ies. The Eastgate squeezed patrons into seats measuring 22
inches across; the Palace has
loveseat-style seats close to 5
feet wide.
Theater attendance last
year fell to its lowest level
since 1995, a crisis propelled
by the rise of streaming. That
is spurring the industry’s biggest changes since the multiplex building boom of the
1990s, when suburban sprawl
and a cash-rich Hollywood
erected cavernous auditoriums
in every kind of neighborhood.
Today, exhibitors are tearing out seats and replacing
them with luxury recliners—
fitting fewer overall seats, but
creating steadier revenue at
higher prices. They’re adding
high-end drinks and dining
Please see CINEMA page A8
.
A2 | Tuesday, April 10, 2018
* *****
THE WALL STREET JOURNAL.
U.S. NEWS
Trump Promises Farm Aid
BY MICHAEL C. BENDER
Continued from Page One
over with concrete.
China’s Defense Ministry
didn’t respond to a request for
comment.
Beijing claims “indisputable” sovereignty over all
South China Sea islands and
their adjacent waters. It demarcates its claims with a Ushaped line stretching from
the Chinese coast almost as
far south as Malaysia.
China says its island-building is for defensive purposes
only, but the activity has
stirred fears that it could use
the outposts to enforce territorial claims that overlap with
those of Brunei, Malaysia, Taiwan and Vietnam, as well as
the Philippines, which is a U.S.
treaty ally. In the past year or
so, China has tried to smooth
relations with other claimants
while continuing work on the
islands.
Three of its outposts in the
Spratlys—Fiery Cross Reef,
Mischief Reef and Subi Reef—
now feature 10,000-foot runways, hangars for fighter
planes, ammunition bunkers,
barracks and deep-water piers
for ships.
While Chinese military per-
China says it will levy penalties on U.S. agricultural products in response to the president’s tariffs.
White House press secretary
Sarah Huckabee Sanders said
later on Monday.
The president will “present
a plan on specifics of that
shortly,” Ms. Sanders said.
Before China announced its
tariffs last week, net farm income in 2018 was already projected to decrease by $4.3 billion, or 6.7%, to $59.5 billion,
according to a USDA forecast
updated last month.
That drop would put farm
profits at their lowest level
since 2006.
Mr. Trump noted that on
Monday the nation’s farm
economy had already “significantly” declined.
“Farmers have been trending downward over an eightyear period,” he said.
He said that farmers would
be helped by his efforts to revise the North American Trade
Agreement, which his trade
team is working to overhaul in
the coming weeks, and a possible deal with China.
Mr. Trump said he would
“probably” find a way to negotiate with China over trade.
If not, he said, “they’ll have
to pay pretty high taxes to do
business in our country.”
sonnel are at the Spratly outposts and Chinese ships dock
there, China has yet to station
ground units or fighter planes
on the artificial islands, U.S. officials said. Nor have surfaceto-air missiles or antiship
cruise missiles been deployed
in the Spratlys, though spots to
install such weapons have been
prepared, U.S. officials said.
But China’s ability to
quickly shift military assets to
the outposts is a serious concern for the Pentagon since it
could enable Beijing to control
ate Armed Services Committee
last month.
According to U.S. intelligence, the new jamming equipment was deployed within the
past 90 days on Fiery Cross
Reef and Mischief Reef.
“While China has maintained that the construction of
the islands is to ensure safety
at sea, navigation assistance,
search and rescue, fisheries
protection and other nonmilitary functions, electronic-jamming equipment is only for
military use,” the U.S. Defense
Department official said.
The U.S. regards most of the
South China Sea as international waters and has sent ships
through the Spratly archipelago
to assert its right to freedom of
navigation in the area.
China has been steadily escalating its military activities
in the area. Beijing has deployed HQ-9 surface-to-air
missiles and J-11B jet fighters
in the disputed Paracel Islands
since 2016. Those islands are
about 500 miles north of the
Spratlys in the South China
Sea.
Beijing also has established
a new Southern Theater Command to oversee Chinese
forces responsible for the
South China Sea.
Recent satellite images
from Planet Labs Inc. showed
The move strengthens
China’s ability to
exert its regional
territorial claims.
vital trade routes, exclude
other claimants from disputed
areas and interfere with the
U.S. military’s plans to defend
Taiwan.
“China has built a massive
infrastructure specifically—
and solely—to support advanced military capabilities
that can deploy to the bases
on short notice,” Adm. Harry
Harris, the head of the U.S. Pacific Command, told the Sen-
Tofu to Go
U.S. soybean exports
Rest of world
$25 billion
China
20
15
10
5
0
1995 2000 ’05
’10
’15
Source: Commerce Department
THE WALL STREET JOURNAL.
about 40 Chinese naval vessels, including submarines and
the aircraft carrier Liaoning,
sailing in formation in the
South China Sea near Hainan
in an unusually large show of
force.
The drills took place from
March 24 to April 5 off the
coast of southern Guangdong
province, then moved off the
east coast of Hainan, where
they will continue until April
11, according to notices from
China’s maritime-safety administration.
“The goal is to inspect and
increase the troops’ training
level, and enhance their capac-
Facebook Inc. has a market
value of more than $450 billion. A Page One article on
Monday about the company
and its CEO incorrectly implied Facebook’s annual revenue is $450 billion. Facebook’s
revenue in 2017 totaled $40.65
billion.
Guard Members
Deployed to Border
Los Angeles prosecutors are
declining to bring criminal
charges against writer and director James Toback in five investigations they have reviewed. The
Oscar-nominated writer-director
has been accused of sexual misconduct by dozens of women.
Documents released Monday
by the Los Angeles County District Attorney’s office said the
statute of limitations in all of
the cases had expired.
Mr. Toback has denied the allegations.
—Associated Press
In some editions Monday,
the last name of James Libson,
a lawyer for Mishcon de Reya
LLP, was misspelled as Lisbon
in a Business News article
about BSG Resources Ltd.
Golfer Rickie Fowler birdied the 18th hole in the final
ROSS D. FRANKLIN/ASSOCIATED PRESS
Writer James Toback
Won’t Be Charged
ity to win a victory,” Chinese
Defense Ministry spokesman
Ren Guoqiang said this month.
“It’s not aimed at any particular country or target.”
Enhancing the Chinese military’s capacity for U.S.-style
joint combat operations—involving all the armed services—is one of the main goals
of a four-year military-restructuring plan begun by Xi Jinping, China’s president and
military chief, in 2016.
Analysts said the exercises
appear to be designed to practice joint operations involving
China’s South Sea Fleet, based
in Guangdong, and the Liaon-
Senator Is Sworn In
And Makes History
Republican Cindy Hyde-Smith
made history Monday when she
was sworn in as the first
woman to represent Mississippi
in the U.S. Senate.
Ms. Hyde-Smith was picked by
Gov. Phil Bryant to fill the seat
held by GOP Sen. Thad Cochran,
who resigned amid health con-
round of the Masters. A Sports
article on Monday about the
tournament incorrectly said
Mr. Fowler birdied the 17th
hole.
An index of economic-policy uncertainty, which averaged 100 from 1985 through
2009, averaged 140.2 during
President Donald Trump’s
first 14 months in office. The
Outlook column in the April 2
edition incorrectly said the index averaged 140.2 during
President Trump’s first 13
months in office and said it
averaged 100 between 1985
and 2010.
Readers can alert The Wall Street Journal to any errors in news articles by
emailing wsjcontact@wsj.com or by calling 888-410-2667.
THE WALL STREET JOURNAL
(USPS 664-880) (Eastern Edition ISSN 0099-9660)
(Central Edition ISSN 1092-0935) (Western Edition ISSN 0193-2241)
Editorial and publication headquarters: 1211 Avenue of the Americas, New York, N.Y. 10036
Arizona Gov. Doug Ducey met with National Guard soldiers on Monday prior to their deployment.
MISSISSIPPI
ing carrier group, based in
China’s northeast, as well as
air, missile and other forces.
Chinese air force spokesman Shen Jinke acknowledged
last month that Su-35s and
H-6s recently conducted joint
combat patrols over the South
China Sea, without specifying
the exact timing or location.
China revealed in February
that it had sent Su-35s, bought
from Russia and delivered in
late 2016, to the South China
Sea for the first time.
U.S. officials said drills involving Chinese marines on
the mainland were part of the
broader exercise as well.
Timothy R. Heath, a senior
analyst at the Rand Corporation, said that while the main
purpose of the exercise was to
improve the readiness of
China’s forces, it was also
sending a political message.
“To Chinese domestic audiences, Beijing is signaling
strength and readiness to defend the country’s interests,
which may bolster nationalist
support for the government,”
Mr. Heath said.
“To the region and the
United States, Beijing is signaling that it has been acting
with restraint, but that it is
willing to meet confrontational policies with its own
confrontational policies.”
CORRECTIONS AMPLIFICATIONS
ARIZONA
CALIFORNIA
American students had
nearly flat results in math and
reading on a national exam,
continuing a pattern of stagnation over most of the past decade, as some of the lowest
performers fell further behind.
Eighth-graders made the
only statistically significant
gain—1 point—in reading, for
an average score of 267 out of a
possible 500, according to the
2017 National Assessment of
Educational Progress, known as
the Nation’s Report Card, released Tuesday.
Average scores were statistically unchanged for eighth-graders in math and fourth-graders
in reading and math, the two
grades tested.
“The scores today on average
are flat except for that one case,
eighth-grade reading,” said
Peggy G. Carr, associate commissioner of assessment at the
National Center for Education
Statistics, which analyzes the results. “Fourth-graders are continuing to show some decline.”
Results for the NAEP, taken
every two years, are based on a
national sampling of students.
The new results are on par with
those from 2011.
Education Secretary Betsy
DeVos has cited flat test scores
in arguing for a new approach
in educating children. She is a
Satellite imagery shows dredging under way at Mischief Reef.
U.S. WATCH
Arizona Gov. Doug Ducey said
Monday that 225 members of the
state’s National Guard were heading to the U.S.-Mexico border to
support President Donald Trump’s
call for troops to fight drug trafficking and illegal immigration.
More of the state’s Guard
members will be deployed on
Tuesday, said Mr. Ducey, a Republican. The Arizona troops
were being sent after Texas announced Friday it would send
250 National Guard members.
President Trump said last
week he wants to send 2,000 to
4,000 National Guard members
to the border.
—Associated Press
big supporter of “school
choice,” providing families with
options outside of a traditional
public-school education, such as
charter schools and voucher
programs. Her opponents say
the alternative methods shift
money from public schools.
In the eighth-grade reading
results, gains made by highperforming students were
partly offset by the largely unchanged scores of lower-performing peers, according to education-department officials.
In eighth-grade math, high
performers again made improvements, but they were offset by declines among lower
performers, for an average
score of 283.
Among fourth-graders, the
scores of lower-performing students declined in both math
and reading, while those of
higher-performing
students
held steady. The average fourthgrade score in 2017 was 240 in
math and 222 in reading.
Average scores for most
states in both subjects at both
grade levels weren’t significantly different from those in
2015.
“Today’s release of The Nation’s Report Card confirms
that there is still much work to
be done,” said Carissa Moffat
Miller, executive director of the
Council of Chief State School
Officers, in a statement.
DIGITALGLOBE/GETTY IMAGES
CHINA
BY TAWNELL D. HOBBS
LUCAS JACKSON/REUTERS
WASHINGTON—President
Donald Trump promised relief
to U.S. farmers caught up in
his administration’s burgeoning trade dispute with China.
“These are great patriots,”
he said on Monday, acknowledging they could be pinched
by new Chinese tariffs aimed
at the president’s political
base.
“They understand that
they’re doing this for the
country. And we’ll make it up
to them. And, in the end,
they’re going to be much
stronger than they are right
now,” President Trump said.
Speaking at the start of a
cabinet meeting at the White
House, the president said, “It
will take a little while to get
there.”
China last week said it
would levy penalties on U.S.
soybeans, sorghum and other
agricultural products, hours
after the Trump administration unveiled plans to impose
tariffs of 25% on Chinese
products worth $50 billion.
After China retaliated, the
president then threatened a
major escalation in trade tensions by saying he was considering tariffs on an additional
$100 billion in imports from
China.
The president has asked the
Agriculture Department for a
list of options to mitigate
China’s “attack” on farmers,
Test Scores Show
Little Progress
cerns. Ms. Hyde-Smith faces several challengers in the wide-open
Nov. 6 special election to serve
the remainder of Mr. Cochran’s
term, through January 2021.
—Associated Press
COURT RULING
Equal Pay Act Applies
Despite Past Salaries
Employers can’t pay women
less than men for the same work
based on differences in their salaries at previous jobs, a federal appeals court said Monday.
Pay differences based on prior
salaries are discriminatory under
the federal Equal Pay Act, a unanimous 11-judge panel of the Ninth
U.S. Circuit Court of Appeals said.
The decision overturned a ruling last year by a smaller panel
of Ninth Circuit judges that had
been criticized by equal-pay advocates.
—Associated Press
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Tuesday, April 10, 2018 | A3
THE WALL STREET JOURNAL.
U.S. NEWS
Cosby
Florida Governor Runs for Senate Bill
Retrial
BY SIOBHAN HUGHES
Opens
BY KRIS MAHER
Florida Gov. Rick Scott said he would run for the Senate against longtime Democratic Sen. Bill Nelson at an event in Orlando on Monday.
tempts to open Florida’s waters to oil drilling, and most
recently pushing for stronger
gun controls, including a ban
on the sale or manufacture of
guns like the one used in February’s shooting at a high
school in Parkland, Fla.
Mr. Nelson’s prior rivals
were considered weak, a trend
that changes with the entry of
Mr. Scott into the race. Mr.
Scott’s political standing has
been on the rise following his
handling of last year’s hurricane and this year’s school
shooting. In a Quinnipiac University poll released in February, Mr. Scott had his highest
ratings ever, with 49% approving of his performance and
40% disapproving—reversing a
seven-year history of negative
ratings.
“I don’t care who is an opponent,” Mr. Nelson said on
Capitol Hill. “I always take
things seriously and I run like
there’s no tomorrow. And I
think in this case, a lot of the
differences between the two of
us are going to come out in
the course of the campaign.”
On Monday, the Cook Political Report, a nonpartisan political forecaster, changed its
rating on the Senate race to
“tossup” from “lean Democratic,” reflecting Mr. Scott’s
entry into the contest. It had
previously ranked four Senate
races featuring Democratic incumbents as tossup races, with
all four in states that President Donald Trump won by at
least 19 percentage points.
Mr. Scott has a close relationship with the GOP president, who won Florida by a single percentage point, and those
personal ties are likely to become a focal point of the race.
One-Year Alternatives to College Pop Up
BY DOUGLAS BELKIN
As a high-school senior in
Hampton, Va., Aidan Cary applied last year to prestigious
universities like Dartmouth,
Vanderbilt and the University
of Virginia.
Then he clicked on the website for a one-year-old school
called MissionU and quickly
decided that’s where he
wanted to go.
Mr. Cary, 19 years old, is enrolled in a one-year, data-science program. He studies between 40 and 50 hours a
week, visits high-tech, Bay
Area companies as part of his
education, and will pay
the San Francisco-based school
a percentage of his income for
three years after he graduates.
This new type of postsecondary education is proving a
hit: The school says it has received more than 10,000 applications for 50 spots.
“I think people feel backed
into a corner by the cost of
college,” Mr. Cary said.
“They’ve been waiting for
something like this so when it
finally came around they could
instantly see the value.”
MissionU, which enrolled its
first class in September, is part
of new breed of institutions that
bill themselves as college alternatives for the digital age. The
schools—whose
admission
rates hover in the single digits,
comparable with the Ivy League,
according to the schools—offer
a debt-free way to attain skills
in hot areas and guaranteed apprenticeships with hightech companies. Together, those
create a pipeline to well-paying
high-tech jobs.
What they lack is an accredited degree, the longtime entry
ticket to a professional career,
and the traditional trappings
of college, including a full liberal-arts education.
While alternative colleges
can teach a person how to
work, they don’t teach their
students why they are working, said Gardner Campbell, an
English professor at Virginia
Commonwealth
University.
Without that context, graduates of these programs run the
risk of becoming well-paid
Beyond Camp
Coding boot camps have been
growing quickly, paving the way
for schools pitching themselves
as alternatives to college.
25,000 boot camp students
20,000
15,000
10,000
5,000
0
2013 ’14
’15
’16
’17
Source: Course Report
THE WALL STREET JOURNAL.
drones, he said.
Many politicians are pushing the attractiveness of college alternatives like vocational schools, amid rising
debt. The enrollment pressures
are creating winners and losers among traditional fouryear colleges.
The precursor to alternative
colleges was coding boot
camps that started to show up
in 2011. They teach students
software engineering skills and
draw mostly college graduates
or college dropouts. In 2017,
there were at least 95 schools
in dozens of cities that produced 22,949 graduates, said
Liz Eggleston, co-founder of
Course Report, based in New
York, which tracks the industry. They cost an average of
$11,000, last 14 weeks and
place graduates in jobs with
average starting salaries of
nearly $71,000 a year.
A new breed of longer programs such as MissionU has
begun to pop up. In California,
the Holberton School and the
“42” program recently opened,
and in Indianapolis, the Kenzie
Academy has begun its second
class. While they remain focused on digital skills, they
also add a smattering of general education courses—in areas like problem solving and
teamwork—and market themselves as college alternatives.
“The degree is dead. You
need experience,” says the
website for Praxis, a five-yearold digital school based in
South Carolina.
Praxis teaches students an
array of digital and soft
skills—such as communications—for six months before
finding them apprenticeships
with startups, mostly in technology. The program costs
$11,000 and is designed to be
covered by the wages earned
during the apprenticeship.
Just 11% of Praxis students
who apply are accepted and
about 200 students have graduated, said Isaac Morehouse,
the company’s founder.
ClickUp, a two-year-old
project management software
company in San Francisco with
nearly 50 employees, has
worked with five Praxis grads.
They have all been strong, productive apprentices, said Chris
Cunningham, ClickUp’s president of client success.
MissionU founder Adam
Braun said students formally
meet once a week and take
most of their classes online.
About half are traditional college-aged, the rest are
older. Students pay nothing up
front. After they graduate and
they have found a job paying
at least $50,000, they pay 15%
of their income for three years.
NORRISTOWN, Pa.—Prosecutors opened Bill Cosby’s
criminal trial outside Philadelphia Monday, telling jurors they
will hear evidence that the entertainer assaulted an acquaintance in his home in 2004 using a predatory pattern he had
used with women previously,
including by positioning himself as a mentor and providing
drugs to incapacitate them.
In this case, the 80-year-old
former star of “The Cosby
Show” is charged with drugging and sexually assaulting a
former Temple University employee named Andrea Constand, after giving her three
Benadryl pills and wine in his
home 14 years ago.
During a roughly two-hour
opening statement, Montgomery County District Attorney
Kevin Steele said Mr. Cosby
first won Ms. Constand’s trust
and then betrayed it, as he had
with other women in the past.
“This case is about betrayal
and that betrayal leading to
the sexual assault of a woman
named Andrea Constand,” Mr.
Steele said. He alleged that
Mr. Cosby handed the pills to
Ms. Constand with the words,
“These are your friends.”
Mr. Cosby has said he had a
consensual sexual relationship
with Ms. Constand and is innocent of the charges. Each of
three counts of aggravated indecent assault against Mr.
Cosby carry a maximum penalty of 10 years in prison.
The entertainer’s retrial on
sexual-assault charges comes
roughly 10 months after his
first trial here ended in a hung
jury and mistrial. Beyond the
atmosphere of the #MeToo
movement surrounding the retrial, a number of factors
make it far from a replay of
Mr. Cosby’s first turn in the
courtroom.
Judge Steven T. O’Neill has
ruled that five other women
besides Ms. Constand can testify, opening the door to allegations of Mr. Cosby’s past behavior with other women.
Mr. Cosby has denied the
allegations in each of those
other cases.
DOMINICK REUTER/AGENCE FRANCE-PRESSE/GETTY IMAGES
RED HUBER/ZUMA PRESS
WASHINGTON—Florida
Gov. Rick Scott said he is running for the U.S. Senate seat
held by Democratic Sen. Bill
Nelson, committing to a contest likely to become one of
the most competitive and
costly in the nation.
“Our work is not done,” Mr.
Scott, a Republican, said in a
speech Monday in Orlando,
Fla., with firm ODC Construction as a backdrop. Saying he
had helped turn the state’s
economy around during his
two terms in office, Mr. Scott
said, “We have to keep looking
forward and that’s why today
I’m announcing another mission….I have decided to run
for the United States Senate.”
Republicans consider Mr.
Scott, with his personal wealth
and broad name recognition,
the only candidate with a shot
at ousting Mr. Nelson, given
Florida’s size and expensive
media markets. Mr. Scott, who
took office in 2011, couldn’t
seek re-election as governor
because of term limits.
The GOP holds 51 seats in
the Senate, but Republicans
have many more opportunities
to flip seats than Democrats do.
Holding Mr. Nelson’s seat is imperative for Democratic hopes
of retaking the Senate, or at
least blocking Republicans from
expanding their majority.
Mr. Nelson, who has represented Florida in the Senate
since 2001, has built a reputation as an effective advocate,
winning money to help the
state recover from Hurricane
Irma, fighting periodic at-
The entertainer faces a new trial.
.
A4 | Tuesday, April 10, 2018
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THE WALL STREET JOURNAL.
U.S. NEWS
A Toxic Cloud Creeps Over Trump-Putin Ties
President Trump, commenting Monday
after the FBI raid of his attorney’s office:
‘So I just heard that they broke into
the office of one of my personal
attorneys—a good man. And it’s a
disgraceful situation.
It’s a total witch hunt.’
‘This is the most conflicted group of
people I’ve ever seen. The Attorney
General made a terrible mistake when
he did this, and when he recused
himself. Or he should have certainly let
us know if he was going to recuse
himself, and we would have used a—
put a different Attorney General in.’
‘It’s an attack on our country, in a
true sense. It’s an attack
on what we all stand for.’
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JORGE SILVA/ASSOCIATED PRESS
Can you have a good relationship with the leader of
Russia at the same time you
have a bad relationship with
the country of Russia?
The quest to do exactly
that has been at the heart of
President Donald Trump’s
global strategy. He has tried
hard to separate his leaderto-leader relationship with
Russian President Vladimir
Putin
(friendly, free
from personal
criticism) from the considerable problems in the broader
U.S.-Russia relationship (increasingly tense, marked by
Russian defiance and American sanctions).
Now that strategy is being
put sorely to the test. In fact,
it may have died in a mist of
chemicals raining down on
civilians in Syria over the
weekend.
In launching a chemicalweapons attack inside his
own country, Syrian President Bashar al-Assad—Russia’s friend and recipient of
all manner of Russian help—
stuck a finger in the world’s
he the first to be hammered
for doing so. Notably, former
President George H.W. Bush
tried to maintain ties to
China’s leaders even amid
the 1989 crackdown on democracy protesters in Beijing’s Tiananmen Square. He
was widely criticized for not
being more outspoken, but
his approach preserved his
ability to get Chinese cooperation when Iraq invaded Kuwait the next year.
President Vladimir Putin of Russia, left, with President Trump at a summit in Vietnam in November.
on the ground in Syria,
where their ostensible goal is
to help mop up the remnants
of Islamic State fighters. Mr.
Trump’s urge, stated explicitly last week, is to get out
and let Mr. Assad and his
Russian and Iranian friends
and the Turks next door sort
out the future.
B
ut in the wake of the
weekend attack, a
withdrawal would
make it appear the U.S. is
willing to turn the fate of
Syria over to the same people who use chemical weapons against the populace. At
a minimum, Mr. Trump, having again just criticized his
predecessor, Barack Obama,
for not taking more decisive
action in Syria, now can’t so
easily walk away.
In short, Mr. Trump, like
other presidents before him,
would prefer to extract himself from the messes of the
Middle East; like them, he
now may conclude that isn’t
easy, and may not even be
possible.
Mr. Putin isn’t the kind of
leader to sit passively if Russian interests in Syria come
under attack by the U.S. The
prospect of tit-for-tat escala-
tion of U.S.-Russian tensions
in Syria—piled on top of
worries over Russian interference in U.S. politics, the
apparent Russian poisoning
of a former spy in Britain
and a sham Russian presidential election—is now very
real. And the idea that the
Trump-Putin relationship can
somehow be insulated from
those broader tensions is under increasing strain.
Mr. Trump is, of course,
hardly the first president to
try to keep cordial relations
with a fellow world leader
even as their countries clash
in the trenches below. Nor is
M
r. Trump seems to
have a particularly
strong belief in the
power of his personal ability
to woo, cajole and manipulate other leaders. In separate conversations, several of
his advisers said that belief
is rooted in his New York
business experience.
Mr. Trump has tried a
similar approach with Chinese President Xi Jinping,
seeking to cultivate a personal connection that can be
walled off from the eruption
of trade tensions.
But maintaining that approach with Mr. Putin, already a strain because of the
investigation into alleged
Russian efforts to help Mr.
Trump win the presidency in
the first place, has become
increasingly difficult. Mr. Putin has proved to be not just
antidemocratic, but determined to make a mockery of
democracy with his interference in an American election.
The weekend tragedy in
Syria simply makes the
strain more extreme.
Lawyer’s Office Is Unusual Target
BY JACOB GERSHMAN
AND JOE PALAZZOLO
The Manhattan law office of
Michael Cohen, President Donald Trump’s personal attorney,
made for an unusual target for
federal agents, who raided it
Monday morning.
Typically, federal agents
need special permission to
comb the files of an attorney,
whose client communications
are generally protected from
disclosure, legal experts said.
To obtain a federal warrant,
Justice Department officials
need a special finding that an
attorney’s office contains crucial evidence, said Christopher Slobogin, a criminal-procedure expert at Vanderbilt
Law School.
It is unclear if agents targeted client files or were
searching for business records
falling outside the scope of attorney-client privilege, though
the lines separating them
aren’t always clear. Steve
Ryan, a lawyer for Mr. Cohen,
said Monday that the search
led to the unnecessary seizure
of protected attorney-client
communications.
When searching the offices
of an attorney who is a subject
of an investigation, “prosecutors are expected to take the
least intrusive approach,” according to the U.S. Attorneys’
Manual, which instructs prosecutors to consider a subpoena before resorting to a
search warrant.
The raid carries risks for the
Justice Department as well. The
attorney-client privilege generally shields interactions between lawyers and clients from
being deployed as evidence
against a defendant. If government lawyers use privileged
communications to build their
case, a court could deem their
entire prosecution tainted.
To guard against that, the
Justice Department uses what
are known as “taint teams,”
groups of government attorneys who are segregated from
Federal Bureau of Investigation
agents and prosecutors involved in the investigation, said
Daniel Goldman, a former assistant U.S. attorney for the
Southern District of New York.
Taint teams are charged with
sifting through seized files and
determining what prosecutors
can use.
Courts have approved the
use of taint teams, but criminal
defense lawyers have long criticized the practice as an exam-
COHEN
Continued from Page One
The actions suggest authorities received high-level approval to conduct the searches
because investigators typically
don’t seize documents from
personal lawyers because of the
sensitivities surrounding attorney-client privilege.
“You don’t know what the
heck they’re going to find,”
said Peter Zeidenberg, a former federal prosecutor who
described the raids as an “aggressive move.”
Federal prosecutors in Manhattan are examining possible
bank fraud by Mr. Cohen, among
other matters, the person familiar with the matter said. The
probe is being conducted out of
the office’s public-corruption
unit. Mr. Cohen’s attorney didn’t
respond to a request for comment about investigators examining bank fraud. Mr. Cohen has
previously said suggestions a
payment to Stephanie Clifford,
the former porn actress known
as Stormy Daniels, violated campaign-finance laws were “without legal merit.”
In October 2016, less than
two weeks before the presidential election, Mr. Cohen
made a $130,000 payment to
Ms. Clifford, The Wall Street
Journal reported in January.
He made the payment as part
of an agreement that bars Ms.
Clifford from discussing an alleged sexual encounter with
Mr. Trump.
Steve Ryan, Mr. Cohen’s
lawyer, confirmed in a statement Monday that prosecutors
executed a series of search
warrants.
Mr. Ryan called the use of
search warrants “completely inappropriate and unnecessary”
and said it had “resulted in the
unnecessary seizure of protected attorney-client commu-
PABLO MARTINEZ MONSIVAIS/ASSOCIATED PRESS
CAPITAL JOURNAL
By Gerald F. Seib
eye. The attack came just
days after Mr. Trump had
said he wanted U.S. troops
out of Syria and away from
its civil war, a declaration
that may have emboldened
the Syrians.
In any case, the president
responded with a rare public
rebuke of Mr. Putin, in essence charging he was complicit in the chemical attack. That marked a
significant departure.
Mr. Trump, moreover, has
essentially promised a response. He has a range of options. He could order the
kind of limited reprisal strike
at Syrian targets that he
launched under similar circumstances a year ago, simply to make a point. He could
launch broader U.S. attacks
on Syrian military sites,
which would have the added
effect of indirectly helping
the Syrian opposition forces
the U.S. continues to aid in
the country.
Alternatively, Mr. Trump
could try to lead a broader
international response. The
Russians will use their veto
to block meaningful action at
the United Nations Security
Council, but the U.S. likely
could get cooperation from
France and the U.K. if Mr.
Trump seeks it. The president likes to act unilaterally;
this may be the occasion to
think multilaterally.
More broadly, the chemical attack may prompt Mr.
Trump to rethink his impulse
to withdraw the small contingent of American forces
Michael Cohen, President Donald Trump’s personal attorney.
Trump’s Lawyer
The ‘Fix-It Guy’
Michael D. Cohen cut his
teeth as a lawyer handling
small-time car-accident cases
in a taxi garage in Queens, NY.
Now, as Donald Trump’s
personal attorney, he finds
himself on a much bigger legal
stage—with the headlights
squarely on him.
In a January 2017 interview
with The Wall Street Journal,
Mr. Cohen said: “I am the fix-it
guy,” adding: “Anything that he
needs to be done, any issues
that concern him, I handle.”
Mr. Cohen, 51 years old,
was in private practice before
2007, when he joined the
Trump Organization as an executive vice president.
Mr. Cohen said he entered
Mr. Trump’s orbit after purchasing four units in a Trump
building and helped with a dispute involving condominium
board members at a different
building.
Anthony Scaramucci, briefly
President Trump’s communications chief, has called Mr. Cohen the “3 a.m. break-the-glass
call” for about 150 people. Mr.
Scaramucci said: “If I had a
problem, someone broke into
the house, or drunk driving, he
would be there in a minute.”
—WSJ Roundup
nications between a lawyer and
his clients.” He added: “These
government tactics are also
wrong because Mr. Cohen has
cooperated completely with all
government entities, including
providing thousands of nonprivileged documents to the
Congress and sitting for depositions under oath.”
A spokesman for Mr. Mueller’s office declined to comment.
Meantime, federal authorities have demanded bank records related to the $130,000
payment, according to a person
briefed on the matter. First Republic Bank, which Mr. Cohen
used to wire $130,000 to Ms.
Clifford’s lawyer on Oct. 27,
2016, conducted its own investigation of the transaction after
receiving the subpoena from
the authorities, the person said.
The bank sent its findings to
ple of the fox guarding the
chicken coop. In rare cases, a
judge could appoint an independent special master to review the files or examine seized
documents him or herself.
Attorney-client privilege is
intended to allow lawyers to
give robust legal advice without
worrying about incriminating a
client. But attorney-client information may not be protected if
the communications were in
service of an illegal act, under
the “crime-fraud exception” to
the privilege.
If agents were after Mr. Cohen’s client files, prosecutors
could still use the information
if they found an intention of
committing or concealing a
crime or fraud, a difficult standard to meet, said Sara Kropf, a
white-collar defense lawyer in
Washington.
the Treasury Department in a
suspicious-activity report, the
person said.
A First Republic Bank representative declined to comment.
The 2016 payment was received in a client-trust account
for Ms. Clifford’s then-attorney,
Keith Davidson, at City National
Bank in Los Angeles, people familiar with the matter said. The
bank also investigated the
transaction last year.
City National previously said
in a statement that it doesn’t
“confirm or comment on inquiries from regulatory agencies
or law enforcement, including
subpoenas.”
For months, Mr. Mueller’s
team has asked witnesses
about Mr. Cohen’s role during
the 2016 presidential campaign,
according to people familiar
with the matter. Their questions have focused on a number
of episodes, including his efforts in the early months of the
campaign to have a Trump
Tower built in Moscow.
Federal agents raided Mr.
Cohen’s office on the 23rd floor
of 30 Rockefeller Plaza after 9
a.m. and remained for several
hours, a person familiar with
the matter said.
Mr. Cohen has said he paid
the $130,000 to Ms. Clifford out
of his own pocket and wasn’t
reimbursed by the Trump Organization or the Trump campaign. But he hasn’t said
whether Mr. Trump had personally paid him back. After the
election, Mr. Cohen complained
to friends that he had yet to be
reimbursed for the payment,
according to people familiar
with the matter.
Mr. Trump denied last week
any knowledge of the payment.
The New York Times reported on Monday that federal
investigators had searched Mr.
Cohen’s office.
—Joe Palazzolo
and Shelby Holliday
contributed to this article.
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | A5
* * * *
U.S. NEWS
of
U.S. Shuts Down Backpage Website Review
Pruitt by
BY DEL QUENTIN WILBER
AND LALITA CLOZEL
to ensure advertisers aren’t
dealing with children.
The 93-count indictment
identified at least 17 instances
where people were allegedly
trafficked for sex through
Backpage, one of whom the indictment said was slain by a
client. Some of the alleged victims were children, one as
young as 14, officials said.
Other charges allege that
people associated with Backpage have earned about $500
million in revenue related to
prostitution since 2004, and
that they engaged in a conspiracy to launder the illicit funds
through overseas banks.
U.S. officials on Monday
called Backpage the leading
online forum for prostitution
ads, including those showing
the prostitution of children.
Authorities have been trying
for years to shut down Backpage, but have faced legal set-
Federal officials said they
were shutting down Backpage,
a classified-ad website that
has long been accused by political leaders and law-enforcement officials of providing a
platform for prostitution and
sex trafficking.
As part of the federal operation, a grand jury in Arizona
indicted seven people associated with Backpage on charges
of facilitating prostitution and
money laundering. They included Michael Lacey, 69 years
old, and James Larkin, 68, the
co-founders of Backpage.
Backpage lawyers didn’t respond to a request to comment
on Monday. But Backpage and
its attorneys have previously
rejected assertions that it participates in fostering prostitution and said it has taken steps
backs due to laws that limit
the liability of websites for the
activities of their users.
“For far too long, Backpage.com existed as the dominant marketplace for illicit
commercial sex, a place where
to human trafficking. Congress
recently passed a law limiting
the legal immunity granted to
websites for actions by users.
Members of Congress, including Sens. Claire McCaskill
(D., Mo.) and Rob Portman (R.,
Ohio), have investigated the alleged role of Backpage in the
sex-trafficking system.
The bipartisan law passed
last month, led by Sen. Richard
Blumenthal (D., Conn.) and Mr.
Portman, would amend the
Communications Decency Act
of 1996 to roll back immunity
that Congress had conferred
on websites for the actions of
their users.
Its passage marked a rare
political defeat for big technology firms, which have become
a powerful lobbying force in
Washington. Since then, a
number of websites have taken
down forums allegedly involved in sex solicitation, in-
Seven were indicted on
charges of facilitating
prostitution and
money laundering.
sex traffickers frequently advertised children and adults
alike,” Attorney General Jeff
Sessions said.
Backpage, already the subject of multiple criminal
probes, had become a lightning rod for critics of websites
accused of turning a blind eye
cluding Craigslist and Reddit.
Others, such as NightShift and
CityVibe, have shut down.
Large companies like Alphabet Inc.’s Google long resisted
any change to the website immunity law, fearing it could
lead to a greater erosion of
congressionally granted legal
protections. Technology advocacy groups have supported
Backpage in some of its legal
battles.
But a series of political misfortunes, including Russian use
of online platforms to meddle
in the 2016 election, have diminished the tech industry’s
standing in Washington, making it easier for lawmakers to
pass the legislation effectively
targeting adult-services sites.
The moves against Backpage didn’t appear directly
linked to the legislation, but
instead resulted from a longrunning investigation.
CBO Raises Estimates for Budget Deficits
BY BEN LEUBSDORF
Wider Deficits
WASHINGTON—Tax cuts
and spending increases enacted over the past four
months will lead to wider budget deficits than previously expected and a mostly temporary
spurt in economic growth,
Congress’s nonpartisan scorekeeper predicted Monday.
The Congressional Budget
Office said the federal budget
deficit would total $804 billion this year, 43% larger than
it had projected last summer,
and exceed $1 trillion a year
starting in 2020. The deficit
was $665 billion in the fiscal
year ended Sept. 30.
Economic growth will jump
above 3% this year thanks to fiscal stimulus, the CBO said, but
the agency predicted the acceleration will prove largely fleeting. Larger deficits will add to
the national debt: Debt held by
the public will hit $28.7 trillion
at the end of fiscal 2028, or
96.2% of gross domestic product, up from 78% of GDP in 2018.
New ten-year projections predict
wider near-term gaps between
government spending and tax
revenue compared with 2017
projections.
ANDREW HARRER/BLOOMBERG NEWS
Government spending
Tax revenue
PROJECTED
24% of GDP
22
Latest
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THE WALL STREET JOURNAL.
CBO Director Keith Hall says
rising U.S. debt will have
serious consequences.
Those estimates assume
current law will remain in effect, meaning Congress would
allow some tax cuts to expire
and spending caps to take effect again in the coming years.
If Congress extends the tax
cuts, as many Republicans
want to do, the CBO predicted
wider deficits and publicly
held debt of about 105% of
GDP by the end of 2028—a
level exceeded only once in
U.S. history, in the immediate
aftermath of World War II.
“Such high and rising debt
Note: Fiscal year ends Sept. 30.
Source: Congressional Budget Office
would have serious negative
consequences for the budget
and the nation; in particular, the
likelihood of a fiscal crisis in the
United States would increase,”
CBO Director Keith Hall said.
Congress in December enacted corporate and individual
tax cuts and in February approved a two-year budget deal,
followed last month by a spending bill that boosted government outlays this year on both
domestic and military programs.
Hoping to rein in federal
spending, top White House officials are working on a proposal of “rescissions,” or cuts
they hope to make to last
month’s $1.3 trillion spending
bill, but it isn’t clear a rescission bill could pass the Senate.
When the CBO last issued
projections in June, it expected
the federal budget deficit
would widen from 2.8% of
gross domestic product in the
2018 fiscal year to 5.2% of GDP
in 2027. That would take the
debt held by the public from
78% of GDP in the current fiscal
year to 91.2% of GDP in 2027.
In Monday’s report, the
CBO revised deficit numbers
higher in the short term. The
deficit is expected to rise from
4% of GDP in 2018 to 5.4% of
GDP in 2022, then ease to 5.1%
of GDP in 2028. The debt held
by the public will climb from
78% of GDP in 2018 to 94.5%
of GDP in 2027, then 96.2% in
2028, the agency said.
Among other things, the
CBO projected lower revenues
because of the tax cuts and
higher interest payments on
the national debt.
“We’ve just had a great deal
of fiscal stimulus on an economy that’s nearly out of
slack,” Mr. Hall said.
The CBO predicted economic output would expand
3.3% in the fourth quarter of
2018 from a year earlier, up
from its June 2017 estimate of
2% growth. Annual growth
would slow in subsequent
years: 2.4% in 2019; 1.8% in
2020; 1.5% in 2021 and 2022;
and 1.7% in 2023 through 2028.
EPA Urged
BY REBECCA BALLHAUS
WASHINGTON—The head of
the Office of Government Ethics on Friday wrote a letter to
the Environmental Protection
Agency urging the department
to “take action” to address any
ethical violations by its administrator, Scott Pruitt.
Dave Apol, the acting head
of ethics office, in the letter
cited Mr. Pruitt’s recent actions that “raise concerns and
may constitute a violation of
the Standards of Ethical Conduct for Employees of the Executive Branch” and outlined
“the resulting need for your
agency [to] take action to appropriately address any violations.”
Mr. Apol’s letter comes as
the White House is conducting
a review of Mr. Pruitt’s activities. White House chief of staff
John Kelly told President Donald Trump in recent weeks
that he was convinced Mr.
Pruitt needed to step down after recent negative reports
about his spending habits and
management style, but the
president is not ready to fire
him, according to a White
House official. “Scott is doing
a great job!” Mr. Trump
tweeted on Saturday.
Mr. Apol cited recent news
reports that Mr. Pruitt had
rented accommodations in
Washington at below-market
rates from the family of an energy lobbyist. Mr. Pruitt also
has faced questions over his
travel expenses, and he had a
testy interview with Fox News
when he was pressed over
large pay raises reportedly
given to two EPA employees.
A spokesman for Mr. Pruitt
didn’t return a request to
comment on the letter, which
was reported earlier by the
New York Times.
Mr. Pruitt has defended his
living arrangements and said
he reversed the pay raises
given to two staff members
once he found out about them.
Continued from Page One
sought structural changes to
the deal, in the form of asset
sales, instead of promises from
the companies on how they
would run their businesses
postmerger.
AT&T didn’t agree. Bayer
did.
Bayer, a German pharmaceutical and chemical conglomerate, is a leading player
in the pesticide industry, while
Monsanto, based in St. Louis,
is a market leader on seeds
and crop genes. The deal,
which was announced in September 2016, would make
Bayer the world’s biggest supplier of pesticides and seeds
for farmers.
The European Union last
month conditionally approved
the deal after Bayer agreed to
sell more than $7 billion
worth of assets to rival BASF
SE. The sales include Bayer’s
soybean and cottonseed businesses, as well as Bayer’s glufosinate weedkiller, which
competes against Monsanto’s
Roundup.
U.S. antitrust officials continued to harbor concerns. After the EU’s move, the Justice
Department said the deal
could have different competitive effects on American farmers and consumers, citing for
example the market for genetically modified seeds, which are
widely used in the U.S. but
largely prohibited in Europe.
As part of an agreement
with U.S. antitrust enforcers,
people familiar with the matter said Bayer will divest itself
of additional seed and seedtreatment assets and will make
concessions related to its digital agriculture business, which
provides data-driven farming
advice and services. BASF will
also acquire those assets, the
people said.
It isn’t clear when U.S. approval could be completed.
“As we’ve said from the beginning, this opportunity is
about combining highly complementary businesses and
bringing new innovative solutions to our customers,” Bayer
said in a statement. “We remain confident in our ability
to obtain all necessary regulatory approvals and look forward to continuing to work
diligently with regulators to
KRISZTIAN BOCSI/BLOOMBERG
DEAL
Germany’s Bayer is a leading player in the pesticide industry.
support that process. We anticipate closing in second
quarter 2018.”
A Monsanto spokeswoman
pointed to a company earnings
statement last week, in which
Monsanto said it “continues to
be confident in the companies’
collective ability to secure the
required approvals within the
second calendar quarter of
2018 and in the time contemplated by the agreement.”
Representatives for the Justice Department and BASF declined to comment.
Bayer’s purchase of Monsanto would be the third in a
series of megadeals to reshape
the $100 billion global market
in crop seeds and chemicals.
Dow Chemical Co. and DuPont Co. last year completed a
merger that united the companies’ agricultural divisions,
which eventually will be spun
out into a new company called
Corteva Agriscience. Swiss
seed and pesticide maker Syngenta AG last year completed
its $43 billion sale to China
National Chemical Corp., expanding the state-owned company’s heft in high-tech seeds
and pesticides.
This consolidation has
raised worries among farmers,
who are struggling against a
global crop glut that has
pushed down prices and farm
incomes. Groups including the
National Farmers Union have
urged antitrust enforcers to
block the deals, warning that
diminished competition among
the global giants could lead to
higher prices and fewer
choices for already-strapped
farmers.
“A game of ‘musical chairs’
among a dwindling set of market players is not a prescrip-
tion for healthy, competitive
agricultural [supply] markets,”
wrote officials for the NFU, the
American Antitrust Institute
and Food & Water Watch, in a
letter sent to the Justice Department last year.
Bayer and Monsanto executives have said combining
would allow the companies to
bring better products to market faster by integrating research across chemicals, seed
breeding and biotechnology.
The companies still need
some additional approvals, including from regulatory bodies
in Canada and Mexico.
While analysts have generally expected the deal to close,
some have warned of uncertainty around the Justice Department review.
There have been recent public signs that the Justice Department was heading toward
allowing the deal. The department had a group of lawyers
preparing for possible litigation on the Bayer transaction
in case talks broke down, but a
leading member of the team,
Julie Elmer, is now working on
the department’s current litigation against the AT&T-Time
Warner deal.
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.
A6 | Tuesday, April 10, 2018
* *
THE WALL STREET JOURNAL.
WORLD NEWS
Jets Strike Syrian Base; Israel Suspected
Rockets hit site
Israelis have said is
being used by Iran to
support Hezbollah
Suspected Israeli warplanes
carried out a deadly missile
strike on a military base in central Syria on Monday, targeting
a site that Israel has said was
used by Iranian forces.
The attack on Tiyas Airbase,
west of the city of Palmyra,
came two days after Syria was
accused of using chemical
weapons against a rebel-held
Damascus suburb, killing dozens of civilians and spurring
calls for international action.
It wasn’t clear whether
Monday’s strike was a response to Saturday’s chemical
attack. Israel has previously
accused Syria of allowing Iran
to set up operations at the
base, also known as T-4, to
supply the Lebanon-based
Hezbollah militia with weapons. T-4 isn’t used for chemical weapons, analysts say.
Russia’s Defense Ministry
said two Israeli F-15 fighters
fired eight guided missiles
from Lebanese airspace, state
news agency RIA Novosti reported. Pro-government Syrian
media said some 20 missiles
were fired, adding that the direction of the strike indicated
Israel might be behind it.
Russia, which along with
Iran has supported the Assad
regime in its seven-year-old
war, said it was concerned
AGENCE FRANCE-PRESSE/GETTY IMAGES
BY SUNE ENGEL RASMUSSEN
AND RORY JONES
Syrian forces gathered Monday outside the rebel-held town of Douma, where a suspected chemical-weapons attack occurred Saturday.
about the strike on T-4 and
was in touch with the Israeli
government about it.
At least 14 military personnel were killed in the strike,
including three Syrian commanders, the Syrian Observatory for Human Rights said.
Iran’s semiofficial Fars News
Agency reported that four Iranians also were among the
dead and it published their
names and photographs.
The Israeli army declined to
comment on the Russian and
Syrian allegations, in line with
its policy of neither confirm-
ing or denying airstrikes. Israeli Prime Minister Benjamin
Netanyahu appeared to allude
to the reports during a public
appearance on Monday.
“We have one clear and
simple rule and we seek to express it constantly: If someone
tries to attack you—rise up
and attack him,” Mr. Netanyahu said at a ceremony near
the Gaza Strip, without referring to the Syrian strikes. “Security in the present is a necessary condition for security
in the future,” he said.
The attack came a day after
world leaders condemned the
alleged chemical-weapons attack late Saturday on civilians
in the rebel-held town of
Douma in Eastern Ghouta outside Damascus. U.S. President
Donald Trump said Syria
would pay “a big price” for the
alleged attack and vowed Sunday a “strong, joint response”
with his French counterpart,
Emmanuel Macron.
Israel for years largely
stayed neutral in the Syrian
war, launching airstrikes only
against Iranian weapons convoys bound for Hezbollah. But
backed by Russia, Iran and
Hezbollah, Syrian President
Bashar al-Assad is emerging
victorious in his country’s war
and Israel has expressed concern that Tehran will establish
weapons factories and military
sites in Syria to attack Israeli
territory.
Mr. Netanyahu’s posture
has shifted in recent months
and Israel’s air force has repeatedly attacked sites in
Syria, raising the prospect of a
wider regional war.
Current and former Israeli
officials didn’t directly ac-
knowledge an Israeli role in
the Monday strike but many
publicly supported the attack.
“We have clear interests in
Syria and we set red lines,”
Yoav Galant, construction minister and a member of Israel’s
security cabinet, told the national broadcaster Kann. “We
will not allow weapons to be
transferred from Syria to Lebanon and we will not allow an
Iranian entrenchment.”
Israeli officials reacted negatively to the chemical attack
in Syria, and Defense Minister
Avigdor Lieberman on Sunday
warned that Israel would have
to act alone in the Middle
East, given the signs in recent
weeks that Mr. Trump aimed
to pull U.S. troops from the
Syrian conflict.
Syrian media said loud explosions were heard in Homs
province after jets entered
Syria from Lebanon. Some
missiles hit the maintenance
section of the base, damaging
a number of drones, Syrian
pro-regime media reported.
Israel in February said the
site targeted Monday was an
air base operated by Iran and
its proxies, after the Israeli
army shot down an Iranian
drone it said took off from the
base. It then launched airstrikes on Syria, drawing antiaircraft fire from Syrian batteries that in turn shot down an
Israeli jet. It was the first time
in more than 30 years that Israel had lost a fighter aircraft.
— Nour Al Akraa,
Dov Lieber, Asa Fitch,
James Marson
and Dion Nissenbaum
contributed to this article.
BEIRUT—President Bashar
al-Assad’s suspected use of
chemical weapons on a rebelheld city this weekend would
be the latest example of the
Syrian leader’s calculus that
the gains from using poisonous gas to terrorize the population outweigh the damage
from any Western retaliation.
Local doctors said a possible combination of chlorine
and nerve agents killed 43
people, many of them children,
in Saturday’s attack on the
city of Douma.
Though chemical weapons
account for a tiny fraction of
what the United Nations says
is more than 400,000 deaths
in the seven-year Syrian conflict, their use has stirred terror in civilians unmatched by
the rockets and barrel bombs
that have killed far more.
The day after Saturday’s attack, the rebel faction in control of Douma agreed to surrender and leave the city in
Eastern Ghouta, on the out-
SYRIA
Continued from Page One
the deaths of the women and
children, the official said.
The United Nations Security
Council held an emergency
meeting on Syria that produced
no consensus for an international response, but the chemical attack represented another
failure of a 2013 international
plan to eliminate Syria’s chemical weapons program, in which
Russia assumed the role of
guarantor.
The Pentagon prepared a series of military options for Mr.
Trump, who said Russian President Vladimir Putin and Iran
shouldn’t evade responsibility if
they helped Mr. Assad carry out
the chemical strike.
“Everybody’s going to pay a
price,” Mr. Trump said. “He [Putin] will, everybody will.”
Syria and Russia both have
denied reports that Mr. Assad’s
forces used chemical weapons in
the attack on a rebel stronghold
that killed at least 43 men,
women and children.
Relief workers released
graphic images of families felled
by the strike. Some had foam
bubbling from their mouths and
noses, one sign that a deadly
nerve agent had been used.
Medical experts and human
rights groups said the preliminary evidence suggested that
Mr. Assad’s forces used a nerve
agent. On Monday, various
American allies, including
France, the U.K. and the European Union, coalesced around
skirts of the capital Damascus.
The capitulation suggests
Mr. Assad is seeking to end
the war not through a political
settlement but on his own
terms: by crushing the opposition wherever it is and by any
means, including siege warfare
and attacks on hospitals, as
well as chemical attacks.
“Assad has routinely increased the barbarity of his violence against his own people
to test the limits of his freedom to act without serious
Western reprisal,” said Jennifer Cafarella of the Washington-based Institute for the
Study of War.
A year ago, after a sarin-gas
attack that killed more than 80
people in the opposition-held
town of Khan Sheikhoun, the
U.S. fired 59 cruise missiles on
a Syrian airfield suspected of
being used to carry out the attack. Hours after the U.S. airstrike, the Shayrat air base
was back in operation.
The Assad regime will continue to follow the same playbook of focusing much of its
A child receives oxygen after a suspected gas strike in Douma.
attacks on one area until rebels agree to surrender, said
Reed Foster, a Middle Eastern
military capabilities analyst
with IHS Jane’s, a defense intelligence provider.
That includes “the sporadic
use of chemical weapons
which does apparently seem to
aid the Syrian regime and does
not seem to have enough consequences,” Mr. Foster said.
In late 2016, pro-govern-
ment forces secured control of
Aleppo by laying siege to half
the city and destroying much
of it with daily airstrikes.
The Syrian government is
supposed to have relinquished
all of its chemical weapons.
After a 2013 sarin gas attack
on Eastern Ghouta, which
killed more than 1,400 people,
the Syrian government joined
the Convention on Chemical
Weapons and agreed to give
Military Presence
NICHOLAS KAMM/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY RAJA ABDULRAHIM
SYRIAN CIVIL DEFENSE WHITE HELMETS/ASSOCIATED PRESS
Assad Regime Has Wagered on Brutal Tactics Israeli
A look at the U.S. military assets known to currently be in and
around Syria:
NGuided missile destroyer USS Donald Cook
NAmphibious assault ship USS Iwo Jima
SHIPS
TURKEY
Manbij
Tabqah
Raqqa
SYRIA
Deir Ezzour
Douma: Site of chemical attack
Med.
Sea
IRAQ
Damascus
TROOPS
A force of more than
2,000 is located
primarily in Manbij,
Raqqa, Deir Ezzour
and Tabqah
IRAN
ISR. JOR.
John Bolton marked his first
day as national security adviser.
EGYPT
SAUDI ARABIA
Red
Sea
AIRCRAFT
Fly mainly from Al Udeid Air Base in Qatar
P ersian
Gulf
Q ATA R
Note: The destroyer USS Porter is near France, a few days from the eastern Mediterranean Sea.
Source: Defense Department
THE WALL STREET JOURNAL.
the conclusion that pro-Assad
forces carried out a chemical
weapons strike.
Mr. Trump spoke Sunday
with French President Emmanuel Macron and they shared
“analysis confirming the use of
chemical weapons,” according to
the French president’s office.
After a call between acting
U.S. Secretary of State John Sullivan and the U.K.’s foreign secretary, Boris Johnson, a spokesman for the British foreign
office said the two agreed that
“this attack bore hallmarks of
previous chemical weapons attacks by the Assad regime.”
The international discussions
suggested that as one option,
the U.S., U.K. and France may
forge a unified response to the
attack, possibly a coordinated
strike targeting Syria.
Defense Secretary Jim Mattis
said Monday he wouldn’t rule
out a strike against Mr. Assad
and blamed Russia for allowing
Syria to use such weapons.
“The first thing we have to
look at is why are chemical
weapons still being used at all
when Russia was the framework
guarantor of removing all the
chemical weapons,” Mr. Mattis
said at the Pentagon. “Working
with our allies and our partners
from NATO to Qatar and else-
where, we are going to address
this issue.” The deliberations
came a week after Mr. Trump
vowed to quickly pull U.S. forces
out of Syria, where about 2,000
troops are working alongside
Kurdish and Arab fighters to
eliminate the last pockets of Islamic State militants.
Mr. Trump’s push led to a
tense national security meeting
last week in which the president
pressed the military to wrap up
the fight against Islamic State,
also known as ISIS, in six
months, according to U.S. officials.
The U.S. already has one
guided-missile destroyer, the
USS Donald Cook, in the eastern
Mediterranean, where it could
take part in any strike on Syria,
according to U.S. defense officials. A second, the USS Porter,
could get there in a few days,
they said. The Porter took part
in last year’s U.S. strikes against
a Syrian air base in retaliation
up its arsenal to avert U.S.
military strikes.
Despite the 2013 deal,
chemical attacks on civilians
have continued, including the
use of weaponized chlorine
gas, according to the U.N. and
other investigating bodies.
The Organization for the
Prohibition of Chemical Weapons said Monday it had begun
an investigation to establish
whether chemical weapons
were used in Saturday’s attack.
But the group, which oversaw
the mission to remove and destroy Syria’s chemical weapons, will need the Assad government’s permission to gain
access to Douma.
Syrian government officials
haven’t responded to requests
to comment on the allegations
of chemical-weapons use. Syrian state media accused the
rebel faction in Douma of fabricating the reports of a chemical attack to elicit support
and stave off defeat.
—Nour Alakraa in Berlin and
James Marson in Moscow
contributed to this article.
for an earlier chemical attack.
The deliberations over Syria
come amid a shake-up in Mr.
Trump’s national security team.
Monday marked the first official
day in the White House for John
Bolton, the hawkish former U.S.
ambassador to the U.N. and former Fox News commentator
who is a proponent of using U.S.
military force to advance American interests.
Adding to the tension in
Syria, a Syrian military base
used by Iranian forces was hit in
a missile strike early Monday,
killing at least 14 people, including four Iranians, according to
Iran’s semi-official Fars News
Agency.
Russia accused Israel of staging the strike, which didn’t appear to be directly related to the
weekend chemical weapons attack. Israel declined to comment
on the reports, but it has carried out scores of strikes in
Syria. White House and Pentagon officials said they couldn't
confirm the origin of the strike.
The suspected chemical attack and missile strike came one
year after Mr. Trump ordered
the U.S. military to launch
nearly 60 cruise missiles at a
Syrian air base used by pilots
who dropped chemical weapons
in a strike that killed more than
80 people. The strike was meant
to deter Mr. Assad from using
chemical weapons, not force
him from power.
—Nancy A. Youssef and
Rebecca Ballhaus in
Washington, Farnaz Fassihi
at the United Nations and
Laurence Norman in Brussels
contributed to this article
Military
Probes
Video
BY RORY JONES
AND DOV LIEBER
The Israeli military said
Monday it has launched an investigation into a video in
which men are heard cheering
as a person is shot at what appears to be a Palestinian demonstration in the Gaza Strip.
The video has been widely
circulated on social media and
comes as the Israeli military
faces international calls for an
investigation into whether it
used unlawful force in recent
weeks in dealing with Palestinian protests at the fence dividing Gaza from Israel.
The video appears to be
filmed through a pair of binoculars or a scope focused on a
group of Palestinians at a
fence and men are heard discussing a potential shot. Then,
after a shot is heard, the video
shows a person collapsing to
the ground. In the video, the
person doesn’t appear to be
armed.
“What a video. Yes. Son of a
bitch,” someone says in Hebrew after the shot. “Look,
they’re running to evacuate
him…What a legendary video.”
It wasn’t immediately clear
when or where the unverified
video was filmed.
In a statement, the Israeli
military said “the event depicted apparently occurred a
number of months ago. The incident is being reviewed and
will be thoroughly investigated.”
There have been large protests at the fence on a number
of occasions in recent months,
including two consecutive Friday protests within the past
two weeks in which demonstrators died and in December,
after the White House announced it would move the
U.S. embassy from Tel Aviv to
Jerusalem.
Palestinian authorities said
at least 30 people, including a
journalist with a flak jacket
marked “Press,” have been
killed in demonstrations since
March 30 and more than 2,500
injured, with roughly 1,000
from gunfire.
The Israeli military said the
army has responded with gunfire and water cannons as Palestinians hurled firebombs at
soldiers and attempted to infiltrate Israel.
Israeli human rights groups
immediately called on the military to conduct a transparent
investigation into the incident.
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | A7
NY
* * * * * *
WORLD NEWS
With Strongman
Out, Zimbabwe
Courts Investors
HARARE, Zimbabwe—At a
faded colonial-era hotel hosting
Zimbabwe’s first mining conference since the fall of longtime
strongman Robert Mugabe, a
succession of government officials repeated what has become
a familiar mantra: “Zimbabwe
is open for business.”
The question is whether investors believe them.
Since Mr. Mugabe’s resignation in November, new President Emmerson Mnangagwa
has been at pains to show the
world that Zimbabwe is overhauling its dilapidated economy.
He has scrapped, for all but
diamond and platinum miners,
laws that required foreignowned companies to sell at
least 51% of their shares to native Zimbabweans.
He has also cut excise duties
on gasoline and pledged to
clear more than $1 billion in
Mining will be at the
heart of any broader
economic recovery in
Zimbabwe.
overdue debt owed to international financial institutions.
Mr. Mnangagwa says his efforts have secured billions of
dollars in investment commitments “from some of the biggest
companies in the world” who
want to dip into the country’s
mineral reserves, including platinum, diamonds and the lithium
that powers the batteries in
electric cars and mobile phones.
Mining, a sector that accounts for more than half of
foreign direct investment and
export earnings, will be at the
heart of any broader economic
recovery.
Mines Minister Winston Chitando said in March that Karo
Mining Holdings, a private
company headed by Cypriot
mining entrepreneur Loucas
Pouroulis, would invest $4.2
billion in a new platinum mine
and refinery, expected to go
into production in 2020. Mr.
Chitando said it was the largest
investment agreement in the
history of the Zimbabwean
mining industry and that the
government intends to establish a full-time “mining onestop shop” by May to fast-track
permits and cut red tape for
Karo and others.
But with Zimbabwe still
gripped by an economic emergency that has left people
sleeping outside banks to get
cash and with national elections due by August, many
other potential investors are
opting to wait and see. Foreign
governments, including those
of the European Union and the
U.S., have said they want to see
a free and fair election and a
clearer policy agenda before reinstituting support for the
country, conditions that were
echoed by many investors at
the Harare conference.
“The first 100 days [of the
new government] was a lot of
talk,” said Alex Mhembere,
chief executive of Zimplats
Holdings, Zimbabwe’s largest
platinum miner and a subsidiary of Johannesburg-based Impala Platinum Holdings, the
world’s No. 2 platinum producer.
Whether Mr. Mnangagwa
can win investments and debt
relief could play an outsize role
in the political and economic
future of Zimbabwe, a commodity-rich nation turned pariah state that has been
pounded by years of recession
and hyperinflation.
Success could cement Mr.
Mnangagwa’s position at the
helm of his splintering ZANU-PF
BY RYAN DUBE
BEN CURTIS/ASSOCIATED PRESS
BY ALEXANDRA WEXLER
Lawyers for
Trump Firm
Sought Help
Of Panama’s
President
Supporters held posters of Zimbabwe’s president, Emmerson Mnangagwa, at his inauguration
ceremony in the capital Harare in November.
party and lure millions of skilled
workers back to the country.
Failure could doom his presidency and herald another period of instability.
For years, Zimbabwe’s mining industry has suffered from
underinvestment, with much of
its vast mineral deposits lying
unexplored. Despite having the
world’s third-largest reserves of
platinum group of metals—including platinum, palladium
and rhodium—Zimbabwe’s production is underperforming because of the uncertainty of policies surrounding operations in
the country as well as restricted access to capital, some
analysts and investors say.
At the February conference,
executives said the government
needed to act quickly to capitalize on the current recovery
in commodity prices.
Mr. Mhembere said Zimplats
could easily double or even triple its output from the metal
deposits it currently mines.
To do so, the company still
wants to see whether the government is willing to ease local ownership requirements
also for platinum miners or al-
Double Trouble
Zimbabwe has been pounded
by years of low growth...
...and ballooning
government debt.
Gross domestic product
Change from previous year
Gross government debt
As a share of GDP
15%
100%
ESTIMATES
ESTIMATES
10
75
5
50
0
25
0
–5
2010
’15
’18
Sources: International Monetary Fund
low it to process some of its
metal in neighboring South Africa, he said.
“We need consistency of policies,” he said.
Yet, at the February conference, Vice President Constantino Chiwenga announced a
new penalty tax on platinum exporters that don’t refine locally.
2010
’15
’18
THE WALL STREET JOURNAL.
Other miners said that they
are still facing delays.
“Zimbabwe is not an easy
country to do business,” said
Victor Tskhovrebov, chief executive of coal miner Liberation
Mining, whose Zimbabwean
mine is being held up by slow
licensing. “There is still a long
way to go.”
Lawyers representing President Donald Trump’s business
asked Panama’s president last
month for help in a legal dispute
over the control of a luxury hotel,
writing in a letter that the case
would have repercussions for the
Central American country.
“We appreciate your influence in order to prevent these
damages being attributed not
to the other party, but to the
Panamanian government,” the
letter said.
Panama’s Britton & Iglesias
law firm sent the letter March
22 to President Juan Carlos Varela on behalf of Trump Organization’s local company, Trump
Panama Hotel Management LLC.
The letter, which was reviewed
by The Wall Street Journal,
claimed that a Panamanian
court committed “innumerable
violations of due process” in ruling against Trump Organization
in a dispute.
Panama’s Foreign Relations
Ministry, which said it received
a copy of the letter, ruled out
that the government would intervene in the case.
Trump Organization, asked
for comment, referred the Journal to the letter from Britton &
Iglesias. The letter said Trump
Organization wasn’t aware of
the firm’s request to the Panamanian president until Monday.
In a statement, Britton & Iglesias denied that it was aiming to
pressure Mr. Varela.
According to a six-page
“white paper” devised by the
law firm of Morgan, Lewis &
Bockius, a trust containing Mr.
Trump’s assets would be run by
his sons and a company executive, Allen Weisselberg, and Mr.
Trump wouldn’t have access to
details about his business.
—Michael Rothfeld
contributed to this article.
.
THE WALL STREET JOURNAL.
A8 | Tuesday, April 10, 2018
IN DEPTH
CINEMA
Cinemark
6,000
screens
0
–20
Cineworld
(owner of
Regal)
9,500
–40
–60
AMC
11,250
–80
2017
Mark and Laurie Schneider, above, lounged before a show at the upscale Palace Cinema in Sun Prairie, Wis. Below, patrons line up at
the theater’s lobby bar. The Palace is in the vanguard of a theater building boom that’s putting an emphasis on luxury.
’18
Note: Screen counts are estimates.
Sources: FactSet (stocks); the companies
(number of screens)
THE WALL STREET JOURNAL.
Lounge King
VIP seats produced and
installed
Revenue, change from a year
earlier
200,000
300%
LAUREN JUSTICE FOR THE WALL STREET JOURNAL (2)
VIP Cinema Seating controls 80% of the U.S. market for luxury
recliners for movie theaters.
150,000
200
100,000
100
50,000
0
0
2012
’14
’16
2012
$50 million to renovate his 15
locations and keep up with the
trends. “It was an expense I
wasn’t willing to do,” he said.
Dickinson was sold to B&B
Theatres, a larger regional chain
that has closed underperforming locations and put recliners
and fancier food options in
more successful auditoriums.
Studio Movie Grill, with 30
locations in nine states, is buying dying multiplexes or big-box
locations left behind by bankrupt chains such as Circuit City
and Sports Authority and retrofitting them with movie screens,
in-theater dining and full-service bars.
“You break it down to the
studs,” said Brian Schultz, the
chief executive. “The Toys ‘R’ Us
closures have us super busy
right now.”
In locales such as Monrovia,
Calif., near Los Angeles, where
Studio Movie Grill retrofitted an
older movie house, “People are
staying for hours,” he said.
Since the newer auditoriums
have higher ticket prices and
pricier food and drink options,
the trend began in affluent
neighborhoods but has since
migrated to smaller communities where moviegoers treat the
outing as a luxury. “You might
not be able to go to the Bahamas, but it’s a staycation,” Mr.
Schultz said.
Regal was acquired by U.K.
operator Cineworld Group PLC
in December for $3.6 billion.
Former No. 4 chain Carmike
Cinemas Inc., sold itself to AMC
after seeing its market share fall
any time a splashier theater
opened nearby.
VIP Cinema Seating, a New
Albany, Miss.-based company,
now controls 80% of the market
for theater recliners in the U.S.
Co-founder Stephen Simons
started the company in 2008 after walking the show floor at an
exhibitor convention with a
friend and noticing that there
were few options for auditorium
seats.
“The U.S. market knew nothing of the premium seat,” and
’16
recliners were reserved for special-event sections of auditoriums, he said. The company
started with 25 employees
working in a 40,000-square-foot
facility. Today it has 550 workers in a 600,000-square-foot
space, and has plans this year
for a second headquarters in the
U.K. and a 150,000-square-foot
manufacturing facility in Eastern Europe.
The company has installed
more than 600,000 recliners
around the world in the past decade, at a cost of $600 to $900
per single seat. Annual revenue
hit $130 million last year, up
from $48 million in 2014, Mr.
Simons said, forecasting higher
revenue in 2018.
Creating the company “was
my 17th midlife crisis, so I just
gave it a shot,” said Mr. Simons.
“As luck would have it, we were
prepared to handle” the demand.
In the 1990s, U.S. theater
chains built sprawling multiplexes in response to increased
competition from VHS rental
stores such as Blockbuster. The
number of screens ballooned to
more than 36,000 from 25,000.
The AMC Grand 24 opened in
1995 in northwest Dallas, a 24screen, 85,000-square-foot colossus with stadium seating that
was once the biggest theater in
the country. Moviegoers drove
three hours to visit.
The layout reinvigorated the
industry, and multiplexes with
one or two dozen screens
sprang up across the suburbs. In
many cases, securing a multiplex as an anchor tenant enabled developers to build an en-
‘You might not be
able to go to the
Bahamas, but it’s a
staycation.’
tire mall. But overbuilding
quickly led to a bust. A wave of
bankruptcies hit around 2001,
and amid consolidation AMC,
Regal and Cinemark emerged as
the three biggest chains.
The financial crisis in 2008
froze financing for new malls
and shopping plazas that would
house new theaters. “Our approach used to be, add new and
take away the underperforming,” said Mark McDonald,
AMC’s executive vice president
of global development. “The
real-estate crisis told us we
need to do more with the real
estate we have.”
In early 2011, AMC decided
to try out a concept it had seen
in some European chains. It
added plush recliners into four
of the 12 auditoriums at the
AMC Lakewood Mall theater
outside Tacoma, Wash., reducing capacity in each by twothirds. The reconfigured auditoriums operated alongside
unrenovated ones, as a controlled experiment. Ticket
prices initially remained the
same.
AMC noticed that some customers were deciding what to
see based on which auditorium
it was playing in, rather than
the movie itself. Ticket sales
rose for weeknight showings, a
typically dead time for most
theaters. A traditional movie
theater sees attendance decline
1% or 2% a year as the facility
ages, Mr. McDonald said. Attendance overall at Lakewood doubled within 18 months of all auditoriums getting the recliners.
THE WALL STREET JOURNAL.
In 2014, AMC said it would
take the reseating strategy nationwide and spend $600 million to revamp 1,800 auditoriums, about a third of its total at
the time, backed by its new majority shareholder, China’s Dalian Wanda Group Corp.
Many of the multiplexes built
in the late 1990s were operating
with 15-year leases that came
up for renewal as the renovation trend was taking off. Exhibitors cited the success of redone
auditoriums in negotiations
with landlords, exhibitor and
real-estate executives said. At
Regal, executives held meetings
they called “catch-up” sessions
to discuss how to replicate
AMC’s model, according to a
former Regal executive.
AMC is now exporting the
design to London-based Odeon
& UCI Cinemas, the theater
company with about 2,200
screens across Europe it bought
in 2016. (The U.S.’s busiest theaters, such as those found in
New York’s Times Square or Los
Angeles, are unlikely to ever get
the luxury-recliner treatment
since they regularly sell out
hundreds of seats.)
Even single-screen houses
like the Diamond Theatre in Ligonier, Pa., a tiny community
about 60 miles east of Pittsburgh, are getting in on the concept.
Leigh Ann Rice-McCulty and
her husband purchased the
1930s theater in 2015 for
$225,000. They couldn’t get a
loan for the purchase—banks
said it was a money loser—so
they cashed in their savings to
buy it.
They spent an additional
$15,000 to install two rows of
what she calls “sweet seats”
from VIP covering about 10% of
the auditorium’s 200 seats.
Most tickets cost $8; the recliners cost $12 and must be reserved in advance.
“A lot of people didn’t know
what they were” at the time,
said Mrs. Rice-McCulty, but now
they often sell out first. “They
were smitten with them.”
cal TV the night of her announcement and the first question: Did you know it was
Distracted Driving Awareness
Month?
Michael Erin Woody, a Republican from California’s central coast running for Congress,
had his own solution for distracted-driving problem. He put
his Jeep Wrangler on a trailer
and had a friend tow it slowly
while filming. “If you pay attention,” he said, “the steering
wheel is sideways.”
In West Virginia, Republican
Evan Jenkins got sideswiped by
Democrats who called him a
“phony” for kicking off his Senate campaign with a video
showing him in a red Ford 150
pickup truck.
The pickup, which has a sideview mirror patched with duct
tape, belongs to his brother-inlaw. “That truck is meant to
represent the idea that Evan is
in it for the long haul,” said
Andy Seré, the campaign consultant who produced the video.
“He’s been a lifelong West Virginian.”
Roger Dean Huffstetler, a
Democrat running for Congress
from Charlottesville, Va., released a video announcing his
candidacy in January. In it, he
drives a white Ford truck while
talking about his father’s job at
a Ford factory.
Local Republicans circulated
a Facebook post that Mr. Huffstetler’s campaign manager,
Kevin Zeithaml, wrote before
the video shoot: “I am in need
of an old Ford pickup truck for
a few hour. No Chevy or GMC
need apply.”
A farmer lent his truck.
“Roger’s fondest memory of his
dad was driving the truck down
to his grandmother’s farm,” Mr.
Zeithaml said.
Now that the campaign driving ad has been added to the
list of political clichés, alongside
factory visits in hard hats and
roadside diner stops, some campaign professionals are applying
the brakes.
Adam Kinsey, an Arizona political consultant, met recently
with Washington advertising
firms on behalf of Kate Gallego,
who is running for mayor of
Phoenix. He recalled he had just
one request: “Can we not have
Kate drive anywhere, please?”
Looking for the Next Hit
Movie ticket sales are falling, while the growth in screens and ticket prices is stagnating.
Movie admissions in the U.S.
and Canada
1.75 billion ticket sales
Movie screens in the U.S.
Average U.S. movie ticket
prices
40 thousand
$10
Inflation adjusted
1.50
8
30
1.25
6
1.00
Actual
20
0.75
4
0.50
10
2
0.25
0
0
0
1990 ’95 2000 ’05
’10
’15
1990 ’95 2000 ’05
’10
’15
Sources: National Association of Theatre Owners; Labor Department (inflation adjustment)
Florida and Wisconsin, respectively.
Candidate ads now sit bumper to bumper. Campaign videos
for four of seven Democratic
candidates running in New
York’s 19th Congressional District show them driving. Seven
gubernatorial candidates also
are motoring.
GOP Rep. Mike Bishop drives
a Buick Enclave through his
ANDY THORBURN FOR CONGRESS
truck. “My name is Scott
Brown,” he said, “and this is my
truck.”
Mr. Brown and his truck won
an upset victory that turned out
to be the Democratic Party’s
first major political defeat of
the Obama era. Rick Scott and
Scott Walker were among Republican candidates that year
who drove to victory with driving ads in gubernatorial races in
’14
THE WALL STREET JOURNAL.
Source: the company
GOP REP. MIKE BISHOP
Continued from Page One
ads, enough drivers to field a
lineup for the Indianapolis 500.
With months to Election Day,
the candidate traffic jam can
only get worse.
The driving gimmick is
meant to convey a sense of accessible authenticity—someone
caught by the camera in a workaday moment. The idea is to
evoke trust and familiarity, a
common touch. No candidate
wants to make the same mistake as Hillary Clinton, a former
first lady, U.S. senator and secretary of state, who acknowledged just before launching her
2016 presidential campaign that
she hadn’t driven since 1996.
“Everybody drives,” said
Dave Jacobson, a Los Angeles
political consultant who produced the ad for Mr. Thorburn,
a Democrat.
Republican Scott Brown was
a trailblazer in the genre. In the
2010 Massachusetts Senate special election, he ran TV ads with
his GMC Grand Canyon pickup
20%
CARY KENNEDY FOR GOVERNOR
DRIVER
Shares of the biggest movie
theater chains have struggled
this year.
MICHAEL ERIN WOODY FOR CONGRESS
Continued from Page One
options, and sophisticated
sound and screens that no home
theater could replicate. Special
attractions such as virtual-reality sections and child-friendly
play areas are extras to entice
people to leave their living
rooms.
“There’s the face of what
theaters were at one time,” said
Rolando B. Rodriguez, the chief
executive of Milwaukee-based
Marcus Theatres, gesturing toward Eastgate. “If you’re building a product for the next 20
years, you need to either renovate it or you build new.” Marcus, the nation’s fourth-largest
circuit, closed the Eastgate location in 2015 and opened the Palace.
The internet has forced
nearly every mall-based retailer
to retool. Many, from handbags
stores to pet food sellers, have
moved upmarket in search of
growth. Coach Inc. cut ties with
hundreds of department stores
and shifted its focus to selling
fewer but higher-priced handbags. Starbucks Corp. is building high-end coffee shops that
will charge as much as $12 a
cup in response to competition
from specialty roasters. Boutique clothing stores, facing
heavy pressure from the internet, have been turning themselves into destinations, offering
everything from high-end restaurants to meditation classes.
Movie theaters need to lure
customers who have plenty of
options to watch at home, and
increasingly need a special reason to come out—a big-screen
blockbuster or a date-night occasion. Big-budget productions
are available on Netflix Inc., and
studios continue to shorten the
amount of time a movie stays in
theaters before becoming available at home, which threatens
to push numbers down even
more.
The nation’s three largest
movie chains—AMC Entertainment Holdings Inc., Regal Entertainment Group and Cinemark
Holdings Inc.—have each dedicated hundreds of millions of
dollars to the reseating efforts,
saying between 40% and 55% of
their auditoriums will be eventually renovated. AMC, the
world’s largest exhibitor, said
247 of its 640 locations were
outfitted with recliner seats at
the end of last year.
AMC has reported increased
attendance in renovated theaters, especially for weekday
screenings that used to play to
empty houses. Regal, which has
focused on offering more-profitable food and alcohol options,
reported in January that while
2017 box-office revenue fell
2.6%, sales of concessions
slipped only 0.3%—a sign that
adding chicken panini sandwiches and Stella Artois beer to
some locations was working.
Investors wonder if consumers will ever return to the movies in the same numbers they
once did. People have access to
deep libraries of entertainment
through Netflix, which plans to
spend $8 billion on original content in 2018 and has indicated it
doesn’t view theatrical release
as a necessary part of making
movies. Other streaming services are gaining popularity, and
quality scripted television offers
more competition for entertainment hours.
Ron Horton, former chief executive of Kansas-based Dickinson Theatres, sold his 169screen circuit in 2014 after
calculating it would cost about
Sold Out
Candidates driving in ads, clockwise from top left: Cary Kennedy,
Andy Thorburn, U.S. Rep. Mike Bishop and Michael Erin Woody.
hometown of Rochester, Mich.,
in a web video launching his reelection campaign. Mr. Bishop’s
Democratic opponent, Elissa
Slotkin, drives a Ford SUV to
her grandparents’ farm in her
campaign video.
The incumbent’s preferred
Big Three auto maker isn’t a coincidence. “It’s a GM district,”
said Stu Sandler, a consultant
for Mr. Bishop.
The campaign genre has
some rules of the road, according to advertising professionals:
It has to be an American-made
car, not too expensive. Show
recognizable landmarks. Candidates should watch traffic, not
the camera.
In Colorado, Cary Kennedy
hit some bumps on the debut of
her campaign for governor last
year. On Facebook Live, she
drove in her neighborhood, her
eyes darting between the road
and her aide.
As Ms. Kennedy, a Democrat,
stopped in her driveway and got
out of her Volvo sedan, the
camera caught six note cards
taped to the dashboard. “Mental
cues,” a spokeswoman said.
Ms. Kennedy appeared on lo-
1990 ’95 2000 ’05
’10
’15
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | A8A
NY
* *
GREATER NEW YORK
Chancellor Begins Tour of Schools
Richard Carranza
praises educators’
can-do spirit, as he
starts his new job
New York City’s new schools
chancellor, Richard Carranza,
got his first full taste of the
job on Monday, as he visited
classrooms in the Bronx to
highlight the agenda of his
boss, Mayor Bill de Blasio.
Mr. Carranza danced like a
daisy, fluttering his fingers like
petals, with a pre-kindergarten
class singing about plants at
Concourse Village Elementary
School. He made a duck out of
colored dough in a so-called
3-K room at P.S. 25, the Bilingual School. And he toured
Bronx Community College with
seventh-graders from P.S./M.S.
279 as they glimpsed what
could await them after highschool graduation.
Expanding access to early
education and college are key
parts of what the mayor calls
his “equity and excellence for
all” initiatives, and Mr. Carranza was quick to show his
BYRON SMITH FOR THE WALL STREET JOURNAL
BY LESLIE BRODY
Richard Carranza, center, visited students at Concourse Village Elementary School in the Bronx.
embrace of those efforts. This
week will be full of photo ops
as he spends a day in each
borough visiting schools. On
Tuesday, he will be in Brooklyn.
“Right now I’m in fact-finding mode and I like what I
see,” Mr. Carranza said. While
his predecessor, Carmen
Fariña, spent more than 50
years in the city system, learning nitty-gritty details and developing longstanding relationships with staff in many
schools, Mr. Carranza has to
meet a host of educators and
learn about a vast bureaucracy.
He took over the nation’s
largest school system, with 1.1
million students, on April 2,
just as the public schools
started a week of spring
break. Before that, he was superintendent of Houston
schools, which serve about
214,000 students.
Echoing Ms. Fariña, the
chancellor said he wants to see
joy in classrooms. He praised
principals, teachers and their
can-do spirit. “Kids are not being allowed to think that they
can’t do it,” he said. “They’re
going to conquer the world.”
Mr. Carranza must grapple
with daunting problems. About
57% of elementary schools citywide were overcrowded last
year, according to the mayor’s
management report. The city’s
Renewal program to fix the
most troubled schools by adding social services and other
resources has had uneven results: Five of the schools in the
program will be closed in June
after failing to turn around.
While test scores have
inched up in recent years, they
remain low in many schools.
About 41% of children citywide
in grades 3 through 8 were
proficient on state tests in
English last spring. That figure
was 27% in the Bronx.
Mr. Carranza said he aims
to tackle segregation and
achievement gaps among students from different backgrounds. “I’m trying to take a
very non-prejudiced eye to
just taking it in,” he said.
Diner Files for Chapter 11, Plans to Stay Open
The company behind Waverly Restaurant, a legendary
diner in the West Village that
serves classic American-style
comfort food, has filed for
bankruptcy protection.
Village Red Restaurant
Corp., the diner’s corporate
name, filed for chapter 11 protection Friday in the U.S. Bankruptcy Court in New York. The
restaurant is facing potential liability in two lawsuits alleging
management didn’t pay overtime to a group of former waiters, dishwashers, busboys and
delivery men.
Filing chapter 11 bankruptcy
halts the litigation and allows
Waverly Restaurant to keep its
doors open as it attempts to
address its liabilities. The restaurant’s bankruptcy petition
estimates it has up to $50,000
in assets and between $500,000
and $1 million in liabilities.
“Yes, we do intend to remain
open,” Stuart P. Gelberg, a bankruptcy lawyer representing Waverly Restaurant, said Monday.
Waverly Restaurant’s move
into bankruptcy comes amid
challenging times generally for
New York diners, which have
been squeezed by changing dining habits and rising rents. Restaurant founder Nick Serafis
filed for personal bankruptcy
protection in January, court records show. The diner is owned
by his daughter, Christine Serafis, who received the restaurant as an inheritance gift,
court papers say.
JEFFREY GREENBERG/UIG/GETTY IMAGES
BY JONATHAN RANDLES
Former employees who sued the restaurant are listed as creditors in the bankruptcy filing. The business disputes their claims.
Court filings list as creditors
former employees who have
sued the business. The workers’
legal claims are disputed by the
restaurant, according to the petition.
A federal judge last year determined Waverly Restaurant is
liable to the employees for unpaid wages, according to court
papers filed in the lawsuit. The
court last month concluded a
bench trial to determine damages against the diner.
The employees have estimated the amount of their potential damages for alleged violations of New York and federal
labor law at more than $2.2
million, plus interest, according
to a June court filing. Several
of the employees had worked at
the diner for a number of years,
including plaintiff Valente Garcia who worked there from
1992 to 2015 as a waiter, host
and counterman.
“The bankruptcy is a blatant
attempt to avoid paying the
back wages owed to the restaurant’s workers,” said Lou Pechman, a lawyer who is representing
former
Waverly
Restaurant employees.
A lawyer who is defending
Waverly Restaurant in the
wage-and-hour litigation didn’t
return a message Monday seeking comment. Ms. Serafis
wasn’t involved in hiring or pay
decisions for any employees at
the restaurant, according to papers filed by the company last
year.
Council
Chastises
NYPD
Over Unit
BY ZOLAN KANNO-YOUNGS
New York City Council members criticized the New York
Police Department for neglecting victims of sexual assault
during a fiery hearing Monday
after a watchdog agency found
the department’s Special Victims Division lacked resources
and sufficient training.
“It is no wonder that victims don’t report more often,”
said Donovan Richards, chair
of the public-safety committee.
“And it seems that NYPD leadership is just fine with victims
of sex crimes being ignored.”
NYPD officials have said
they disagree with the findings
in last month’s Department of
Investigation report and that
the bipartisan agency’s officials didn’t interview key people with knowledge of the division, such as the chief of
detectives. The NYPD will soon
issue a formal response to the
report. Last week, NYPD Commissioner James O’Neill said
Dermot Shea will look at the
leadership and staffing of Special Victims when he steps into
the role of chief of detectives
later this month.
The Department of Investigation reported that the NYPD
didn’t add enough investigators to handle a 65% increase
in case loads since 2009, despite requests from Michael
Osgood, the deputy chief of the
Special Victims Division, who
was interviewed for the report,
and recommendations from a
2010 working group. Mr. Osgood was present at the hearing Monday but didn’t testify.
At the end of 2017, 72 detectives were assigned to the
Adult Sex Crimes unit in the
division, Chief of Department
Terence Monahan said. On
Monday, 20 more investigators
started at the Special Victims
Division. The division’s overall
head count has risen to 238
last year from 149 in 2010.
New York City has recorded
384 rapes this year compared
with 308 in the same period
last year, a 25% increase.
There have been 806 misdemeanor sexual assaults, an 8%
increase over last year.
Mr. Richards pressed on the
fact that 15 of the 20 investigators added to the division
aren’t full-fledged detectives;
they are officers working in
that capacity to earn the rank,
known as “white shields.” The
DOI recommended the NYPD
consider only “highly experienced and knowledgeable detectives” for the division. NYPD
brass contended that calling
“white-shield” investigators inexperienced is misleading because they have an average of
6.6 years on duty.
BY MELANIE GRAYCE WEST
New York State Police are
looking into whether a navigation device played a role in a
bus slamming into a Long Island
overpass, injuring dozens of
students returning home Sunday night from a European trip.
Investigators are examining
the device the driver, Troy
Gaston, 43 years old, was using
when the roof of the charter
bus was ripped off by an overpass on the Southern State
Parkway, police said Monday.
Tractor-trailers and buses
aren’t allowed on the road,
which has low overpasses.
A forensic analysis of the
GPS device and passenger interviews are ongoing, police
said.
Two high-school students
remained hospitalized on Monday afternoon.
The bus was carrying 38
students ranging in ages from
16 to 18, with five adult chaperones, police said.
Dozens of passengers were
injured in the crash; most were
taken to area hospitals and
later released. The two most seriously injured victims are both
17-year-old girls, police said.
The vehicle, operated by
Journey Bus Lines of Irvington, N.J., was traveling from
John F. Kennedy International
Airport in Queens when it hit
an overpass in Hempstead,
N.Y., at about 9 p.m.
Mr. Gaston had a valid
driver’s license and didn’t
have alcohol in his bloodstream, police said. A drug
evaluation is pending. Mr. Gas-
ton, who couldn’t immediately
be reached, lives in Pennsylvania, police said.
An employee who answered
the phone at Journey Bus Lines
but declined to give his name
said the company’s main concern was taking care of the passengers and their families, and
working with the state police.
According to a federal database, Journey Bus Lines has
five buses and 16 drivers. The
company has a satisfactory
rating, with no crashes or injuries in the past 24 months.
KEVIN HAGEN/ASSOCIATED PRESS
GPS Might Be Culprit in Bus Crash
A charter bus carrying 38 students and five adults hit an overpass
on the Southern State Parkway on Long Island on Sunday night.
OYSTER PERPETUAL
submariner date
rolex
oyster perpetual and submariner
are ® trademarks.
.
A8B | Tuesday, April 10, 2018
NY
* *
THE WALL STREET JOURNAL.
Musical Chairs at Lincoln Center
Harry Potter and The
Shattered Box Office
BY CHARLES PASSY
Even weeks before it opens
on Broadway, “Harry Potter
and the Cursed Child” is
breaking box-office records.
The two-part drama, which
brings the popular literary
franchise to the stage, set an
all-time weekly sales mark
for a Broadway play, according to the Broadway League,
the trade group that tracks
the industry.
While still in previews, the
$2.1M
Amount the show grossed for the
seven-day period ended Sunday
show grossed $2.1 million for
the seven-day period ended
this past Sunday, eclipsing
the previous record of $1.6
million set by the play “All
the Way,” starring Bryan
Cranston, in 2014.
“Harry Potter and the
Cursed Child,” which opens
on April 22, has been among
the most anticipated arrivals
on Broadway in recent seasons.
Not only does the show
tap into the fervor for all
things Potter, but it has
proven to be a critically
praised drama in its own
right.
The play, which can be
seen over two nights or on
the same day in matinee and
evening
performances,
opened in London’s West End
in 2016 and won a record
nine Olivier Awards—the
British equivalent to the Tony
Awards, including one for
Best New Play.
Though it features the key
characters from the literary
series about the world of
wizardry, “Harry Potter and
the Cursed Child” stands
apart from it as a new and
original endeavor.
Harry Potter author J.K.
Rowling developed the story
in collaboration with theater
professionals Jack Thorne
and John Tiffany. Mr. Thorne
wrote the script.
Most Broadway observers
see the show’s early success
as just the beginning, noting
that the box office should increase during such peak sales
periods as the winter holidays.
Melissa Anelli, who runs
events for both Harry Potter
and Broadway fans, notes
that the literary series is now
attracting a new generation
of readers—and Potter fans
are likely to be interested in
the Broadway incarnation.
The play “is going to be in
business for a very long
time,” she added.
KEVIN HAGEN FOR THE WALL STREET JOURNAL
‘Harry Potter’ is in previews at the Lyric Theatre in Manhattan.
With the announcement
late last week of another leadership change at Lincoln Center for the Performing Arts,
some arts-industry insiders
and observers are speculating
that the cultural institution
could face a difficult future.
Debora Spar, a seasoned academic administrator who
took over as president of the
center just a year ago, said
Friday she was resigning. In a
letter to staff that was made
available publicly, Ms. Spar
said that she “ultimately determined that the fit I’d hoped
for has not materialized.”
The center has appointed
Russell Granet, a member of
its senior leadership team
since he joined the institution
in 2012, as its acting president.
Ms. Spar’s departure marks
the second time in the last two
years that Lincoln Center’s top
executive has left. In 2016, Jed
Bernstein, a Broadway producer
who was appointed the center’s
president in 2013, resigned.
Such turnover doesn’t bode
well for most cultural organizations, insiders and observers
say, and that can be especially
true for an organization of the
size and scope of Lincoln Center.
The nonprofit entity, which
has an annual budget of $138
million, serves as the home for
BEN GABBE/GETTY IMAGES
RICHARD B. LEVINE/ZUMA PRESS
BY CHARLES PASSY
In 2016, Jed Bernstein, left, resigned as Lincoln Center’s president. He was replaced in 2017 by
Debora Spar, who stepped down last week. Russell Granet, right, will temporarily replace her.
such august institutions as the
Metropolitan Opera, the New
York Philharmonic and the New
York City Ballet. It also produces
many of its own programs.
Ms. Spar’s resignation could
have a decisive impact on Lincoln Center’s ability to raise
funds, said Michael Kaiser, former president of the John F.
Kennedy Center for the Performing Arts in Washington.
Aside from raising money to
meet its annual budget, the center also had been working with
the New York Philharmonic on
an ambitious $500 million plan
to revamp David Geffen Hall, the
orchestra’s home at the center.
Last October, the center and
orchestra announced the proposal was being shelved. But a
new plan is in the works and
expected to be announced this
summer, according to Deborah
Borda, the Philharmonic’s
president and chief executive.
She said Ms. Spar’s resignation didn’t change the efforts
going forward on Geffen Hall.
Key officials with Lincoln
Center’s board didn’t respond
for comment about the latest
management shake-up. But in a
statement, board chair Katherine Farley said Ms. Spar “led efforts to develop a new strategic
plan” for the center and “has
been a champion for expanding
community engagement and
cultivating new audiences.”
Ms. Spar declined to comment on her resignation beyond her letter to the staff.
As much as Ms. Spar’s departure may spark questions
about Lincoln Center’s operations, some who are familiar
with the institution suggest this
may have simply been a case of
a hire who didn’t work out. In
particular, they say Ms. Spar’s
background in academia—she
was formerly the president of
Columbia University’s Barnard
College—may not have fully
prepared her to make it in the
nonprofit cultural world.
—Jennifer Smith
contributed to this article.
GREATER NEW YORK WATCH
ATLANTIC CITY
Profits Rose in 2017
At Remaining Casinos
Less competition led to higher
profits for Atlantic City’s casinos
in 2017.
The seaside gambling resort
saw five of its 12 casinos shut
down since 2014. The seven casinos that remain saw their gross
operating profits increase 22.5%
last year, to $723 million.
Harrah’s was the only casino
whose profit declined, down 2.7%
to $115.8 million. The Borgata had
the highest profit at $292 million,
up 19.5% from 2016.
Gross operating profit reflects
earnings before interest, taxes,
and other charges, and is a widely
accepted measure of profitability
in the Atlantic City casino industry.
“It was a very up year,” said
James Plousis, chairman of the
Casino Control Commission.
He noted that all seven casinos
showed an increase in total revenue and that hotel occupancy and
room rate stats were up as well.
This summer, two of the
closed casinos are due to reopen:
the former Trump Taj Mahal as
Hard Rock, and the former Revel
as the Ocean Resort.
—Associated Press
BROOKLYN
Chuck McCann, Comic
And Actor, Dies at 83
Brooklyn native Chuck McCann, the zany comic who
hosted a children’s television
show in the 1960s before
branching out as a character actor in films and TV, died Sunday
in Los Angeles. He was 83
years old.
Mr. McCann died of congestive heart failure in a Los Angeles hospital, according to his
publicist.
Born Sept. 2, 1934, Mr. McCann, became a household name
in New York when he took over
a variety show, entertaining a
generation of children with lighthearted humor and puppets.
In 1968, Mr. McCann appeared in his first major film,
“The Heart is a Lonely Hunter.”
He expanded his work into animation acting and created the
voice of Sonny the Cuckoo Bird,
who cried “I’m cuckoo for Cocoa
Puffs!” in commercials for General Mills.
He moved to Los Angeles in
the 1970s and made guest appearances on shows including
“Little House on the Prairie,”
‘’Bonanza” and “Columbo.”
—Associated Press
Don’t miss the next life-changing innovation. Get revelatory
insights into the topics shaping tomorrow with The Wall Street
Journal’s Future of Everything. Along with our magazine,
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exciting changes transforming our world.
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GREATER NEW YORK
.
LIFE&ARTS
Tuesday, April 10, 2018 | A9
Clockwise from left: A sold-out ‘Last Podcast on the Left’ show in Millvale, Pa.;
Josh Clark and Chuck Bryant at a ‘Stuff You Should Know’ performance in
Washington, D.C.; the cast of ‘Welcome to Night Vale’ in Portland, Ore.
DIGITAL MEDIA
On the Road,
Podcasts Take Off
The most popular audio shows now draw millions of listeners, and their
hosts and producers are capitalizing on that connection
BY JOHN JURGENSEN
Tuned In
THE HORROR and truecrime series “Last Podcast on the Left” played
39 live gigs last year,
from Atlanta to Vancouver. Fans waited for hours
to meet the three hosts,
sometimes presenting
them with “gifts” such as
vials of blood and a relative’s cremains.
“It’s not ‘Prairie Home
Companion,’ ” said the
Fans surround Henry Zebrowski of ‘Last
trio’s booking agent, Josh
Podcast on the Left’ after a live show.
Lindgren, whose agency
Billions represents bands
podcast averages up to 1 million
like Arcade Fire. “It’s the only
downloads per episode, and their
podcast show where I’ve seen a
most recent tour included two
fight break out.”
back-to-back shows at the Chicago
Podcasters are the new rock
Theatre, capacity 3,500.
stars of the touring circuit. A
But show business presents
niche industry only a few years
challenges for some podcasters
ago, the most popular podcasts
used to hunkering in their recordnow draw millions of steadfast lising studios and interacting with
teners, and their hosts and prolisteners primarily online.
ducers are capitalizing on that
“I have spent my life in dark
connection by taking their audio
rooms, alone, staring at sound
shows on the road.
“It’s an intimate experience being waves. It’s going to be an adjustment,” said Alix Spiegel of “Invisiin someone’s earholes. They take us
bilia,” an NPR podcast exploring unon road trips, on their commute, on
seen forces in human behavior. She
the treadmill,” Chuck Bryant, coand co-host Hanna Rosin joke that
host of “Stuff You Should Know,”
alcohol will help them loosen up for
said last week as he prepared to
their first big show. It will be April
perform in Boston for 1,000 fans.
19 at the Lincoln Theatre, a Wash“People we meet always say we feel
ington, D.C., venue whose lineup is
like friends of theirs.”
increasingly podcast-heavy.
In 2015, the rollicking advice
Live shows are the first opportushow “My Brother, My Brother and
nity for many podcasters to meet
Me” made an appearance in Mintheir listeners—and discover how
neapolis that drew 500 people and
their version of groupies behave.
$8,500 in ticket sales. The followPerformers in “Welcome to Night
ing year the three brothers who
Vale,” a sci-fi drama that has rehost it hit venues twice as large,
leased 135 episodes since 2012 and
generating triple the sales. Their
The U.S. podcasting audience has
grown sharply over the past 10 years,
with 26% of Americans listening to at
least one in the past month.
Percentage of people 12 years
and older who have ever listened
to a podcast
Listened to a podcast
in the last month
50%
40
30
20
10
0
2008
2010
2018*
*Estimated
Source: Edison Research and Triton Digital
THE WALL STREET JOURNAL.
now visits about 55 cities a year,
got a post-show jolt in Amsterdam
when a fan, seeking autographs and
selfies, threw himself on their taxi.
Producers of podcasts, which
are typically free, are selling VIP
access. For its East Coast tour next
month, Cambridge, Mass.-based
podcast network Radiotopia is selling “super citizen” tickets, from
$500 to $1,000 for a package that
includes a party with stars from
shows such as “99% Invisible” and
“The Kitchen Sisters Present.”
There are more than 525,000
active podcasts available on Apple
Podcasts, the genre’s most popular
platform. More than one out of
four Americans ages 12 and up—an
estimated 73 million people—listen
to podcasts at least monthly, up
from 9% a decade ago, according
to a 2018 survey by Edison Research. Some 48 million tune in to
podcasts every week, the marketresearch firm said, listening to
seven shows on average.
Hollywood talent firm Creative
Artists Agency has 12 agents handling the touring careers of podcast clients, and another dozen
working on their film, television
and book deals. Booking agents
map out tours after studying
where the streaming and download activity is strongest.
For one podcasting client, former mixed-martial-arts fighter
Brendan Schaub, pockets of listeners in Dublin, Ireland, and Melbourne, Australia, led to live
shows there during his first overseas dates. Such gigs “would be a
very risky and expensive gamble if
you don’t have that data,” said
CAA agent Justin Edbrooke.
The data also help convince
venues to book podcast stars
they’ve never heard of. Part of the
introduction: talking promoters
into paying podcasters the thousands of dollars they would otherwise devote to advertising.
“We don’t want you to spend
that money up front to market
this, because these people are
probably going to sell out your
venue just by announcing the
show on their podcast,” said
Kenny Layton of the William Morris Endeavor agency. Of the 75
podcasts represented by WME,
about 50 are expected to perform
CLOCKWISE FROM TOP LEFT: HEATHER SCHOR (2); STEPHEN VOSS/THE WALL STREET JOURNAL; VERONICA ROSE
THE WALL STREET JOURNAL.
live this year.
Radio shows such as “This
American Life” have long done live
tapings. Since the podcast genre’s
explosion, thanks in part to hits
like “Serial” in 2014, distributors
such as NPR have scaled up live
performances to bolster marketing, revenue and sponsors.
However, “not every podcast is
meant to be a live show,” said Jessica Goldstein, NPR’s director of
events and strategic initiatives. The
company recently mounted its first
“pilot” performance for a few hundred people at its Washington headquarters, testing the stage potential
for the current-events podcast “It’s
Been a Minute With Sam Sanders.”
When “The Last Podcast on the
Left” began playing bigger rooms,
its team dealt with it like a band
experiencing a growth spurt.
“We were worried we wouldn’t
be able to control a room that size
in a rock venue,” especially once the
bar opened, said Marcus Parks, who
co-hosts the comedy show with Ben
Kissel and Henry Zebrowski. “You’re
not usually expected to listen politely at places like that.”
Some concert rituals do carry
over. “Say ‘hello’ and the city
name,” said Meg Bashwiner, one of
the stars of “Welcome to Night
Vale,” “and they start screaming.”
Mr. Bryant, who co-hosts “Stuff
You Should Know” with Josh
Clark, dealt with his initial stage
fright by fessing up onstage.
“I could go out and tell everyone in the audience that I felt like
I was about to throw up and poop
in my pants. And they’d all laugh,
because it was relatable,” he recalled. “They want Josh and Chuck
up there, awkwardly stumbling
through the show.”
BURNING QUESTION
BY TOM PERROTTA
MILLIONS OF U.S. runners are
starting to greet the warmer
weather with an outdoor run.
Some portion will finish those
runs with knee, foot or back pain.
What can a runner with consistent pain do to fix it short of a
costly gait analysis? There’s no
easy solution, but experts say
there are ways of lessening the
discomfort. Some are simple, while
others require more work.
Fortunate runners feel no pain
thanks to superior technique and
genes, says Jonathan Roth, an orthopedic surgeon based in Wayne,
N.J. For those who regularly ache
after running, it’s smart to make an
adjustment. That can mean a
change in routine or a different
sneaker.
“The best person to tell whether
you’re running correctly is you,” Dr.
Roth says. “If it doesn’t feel right
to you, if it causes pain, if it makes
your knees hurt, then it’s not the
right shoe for you. It’s not putting
you into a right position. It’s more
trial and error at that point.”
New sneakers aren’t expensive,
but buying the right set can take
some work. Some stores put customers on a treadmill to observe
their technique and the sneakers
that best work for them. People
with knee and hip pain are sometimes better off with a flatter
shoe.
Irene Davis, a professor of physical medicine and rehabilitation at
Harvard Medical School, has studied what role modern shoes play
in runners’ pain. Among her conclusions: Modern, heavily padded
sneakers can be a major problem
for runners.
In the 1970s, the early days of
the running boom, shoes were thin
and didn’t change your style of
running as much. Feet would hit
Please see RUNNING page A10
ISTOCK
HOW CAN YOU MAKE RUNNING LESS PAINFUL?
Avoiding hard surfaces like concrete in favor of dirt trails is one way to reduce running pain.
.
THE WALL STREET JOURNAL.
A10 | Tuesday, April 10, 2018
LIFE & ARTS
CULTURAL COMMENTARY
From Budapest to Broadway
STEPHEN SONDHEIM’S famous one-sentence appraisal
of Rodgers and Hammerstein’s first two collaborations—“‘Oklahoma!’ is about
a picnic, ‘Carousel’ is about
life and death”—is only
partly true. The power of
“Carousel,” whose latest
Broadway revival opens this
week, is that it’s both things
at once, encompassing not
only life and death but a
“real nice clambake.”
When the Theater Guild
first proposed in 1943 that
composer Richard Rodgers
and lyricist Oscar Hammerstein II turn Ferenc Molnár’s
“Liliom” into a musical, Rodgers initially declined because the play, introduced in
Hungary in 1909, “was continually being revived without any help from a songwriting team.” But even
then, two years before their
show first came to Broadway, the two men were
drawn to the possibilities the
story opened up for the rapidly expanding medium of
musical theater.
Molnár (1878-1952) was
known for combining romantic comedy and whimsy with
dramatic irony and a heavy
dose of moralism. In both
“The Guardsman” (1910) and
“The Good Fairy” (1930), he
plays with notions of infidelity and mistaken identity.
Those works and “Liliom”
have a considerable amount
of sexual intrigue, and all
were translated into various
languages, staged on Broadway and adapted into early
sound films.
Although Rodgers and
Hammerstein shifted the setting of “Carousel” from the
Budapest of “Liliom” to New
England and gave it a distinctly American flavor, they
FROM TOP: EILEEN DARBY/THE LIFE IMAGES COLLECTION/GETTY IMAGES; 20TH CENTURY FOX/EVERETT COLLECTION
BY WILL FRIEDWALD
maintained Molnár’s balancing act. Working from his
blueprint, they created a
Broadway masterpiece, a tale
of a wife-beating miscreant
who is somehow strangely
sympathetic—a story with a
message that no soul is beyond redemption, even if he
has to transcend his own
lifetime and travel back and
ADVERTISEMENT
forth from The Next World
to achieve it.
As Tim Carter delineates
in his new book, “Rodgers
and Hammerstein’s ‘Carousel,’” “Liliom” premiered in
Budapest but fared better in
Berlin and then Vienna in
the immediate pre-World
War I period. It was also a
hit on Broadway in 1921, pro-
duced by the Theater Guild
in an English translation primarily (although anonymously) by Rodgers’s future
songwriting partner, Lorenz
Hart. The basics of “Carousel” are all there: Julie is an
innocent but dissatisfied
young girl who wants more
out of life than the restrictive path that society lays
out for her. In contrast to
her best friend, Marie (Carrie in “Carousel”), who marries a respectable, hardworking fisherman-cumbusinessman, Julie falls for a
charming, low-life ex-carnival barker with no employment prospects.
After Molnár saw “Oklahoma!” he was convinced, no
less than the Theater Guild,
that Rodgers and Hammerstein were the ones to turn
“Liliom” into a musical. The
collaborators themselves
couldn’t resist the challenge
of bringing to life the story’s
complex antihero. In “Oklahoma!” terms, Billy Bigelow
is both Curly (with perhaps
even more flamboyance and
animal magnetism) and Jud
(with his violent and sociopathic tendencies): the good
guy and heavy rolled into
one. Rodgers and Hammerstein were especially eager to
write “Soliloquy,” Billy’s reaction to the news that Julie
is pregnant, where he expresses mixed feelings over
the notion of paternity in
general and the gender of his
forthcoming child in particular. This was something entirely new in musical comedy,
a number in which a character reveals his inner turmoil
and undergoes a complete
emotional arc in song, in full
view of the audience.
They also created the
RUNNING
Continued from page A9
the ground at a flatter angle,
rather than striking dominantly with the heel, as often
happens today.
“Because of wearing this
chronic, supportive, cushion
shoe, we end up coddling
our feet, making them
weaker and putting them at
the risk of being injured,” Dr.
Davis says. “The closer that
we run to the way we were
adapted to run, from an evolutionary standpoint, the
lower the risk of injury.”
To change your form, Dr.
Davis suggests thin shoes.
(Among those she recommends: Vivobarefoot, Xero
Shoes and Inov8 Bare-XF 210.)
But she adds a warning: It
could take up to a year for
your body to adjust. You
must condition your legs
The scene from Rodgers and Hammerstein's ‘Carousel’ (1945)
when Billy spots Julie and falls in love with her, above; Shirley
Jones and Gordon MacRae in the 1956 film version, below
show’s iconic “bench” sequence, a combination of
love scene and romantic
duet—incorporating the
song “If I Loved You”—that
brilliantly and logically
brings the two protagonists
from first meeting to matrimony in a matter of minutes. (This classic scene lost
most of its magic in the disappointing 1956 movie version, whose effervescent
Shirley Jones, as Julie, desperately needs a leading
man with both charisma and
menace. Gordon MacRae
seems merely naive; Frank
Sinatra, the original casting
choice, would have been
perfect.) Because Molnár’s
ending wasn’t strong
properly, and the process is
slow. It begins with brisk
walking, then adding slow
running miles one at a time,
with days off in between. The
key is not to rush, she says.
“It would be like me going
to the gym and lifting a hundred pounds when I haven’t
If you change to
shoes with thinner
soles, be sure to
transition slowly.
done any training for it,” she
says. “And you’re going to
get hurt.”
Dr. Davis says that when
you run in minimal shoes
that make it easier to land
on the front of your foot,
your feet and calves get
stronger. Stronger feet are
enough for the team, they
concluded with a rousing finale, which centers on the
most anthemic hymn in
Broadway history, “You’ll
Never Walk Alone.”
In Fritz Lang’s 1934
French film of “Liliom,”
when the title character returns from the afterlife, just
for one day, he meets his
daughter, now 16 years old,
and tells her that he was a
friend of her late father. She
asks if he was a good man
and he says, “well, he knew
some good songs. Some
pretty ones!” Amen to that.
Mr. Friedwald writes about
music and popular culture
for the Journal.
healthier feet. Her team’s research on the increase in leg
and foot muscle volume after
a transition to minimalist
running shoes was published
in the July 2016 edition of
Clinical Biomechanics.
“There is a building body
of evidence that this type of
running is going to help us
be less injured,” she says. “I
go back to the fact that you
can’t outdo Mother Nature.”
There’s also a matter of
where you run. Roads or
sidewalks made of asphalt or
concrete are hard and put a
lot more pressure on your
feet and legs than a track
made from a softer surface.
Better still: running on grass
or dirt.
“A nice, flat, well-maintained dirt trail is probably
one of the best,” Dr. Roth
says. “That’s what people
have been running on hundreds and thousands of
years.”
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | A11
LIFE & ARTS
TELEVISION
‘Lost in Space’ Returns
In a Dark Reboot
pening to us?’ ”
In the rebooted TV series,
the Robinson family are space
colonists who escaped Earth.
The robot isn’t part of their
mission, unlike in the ’60s series. Young Will Robinson
(played this time by 12-yearold Maxwell Jenkins) encounters the sentient automaton
after a crash on an unknown
planet throws the clan into
survival mode.
Where the original robot
was verbose and prone to
arm-flapping alarm, the new
model is a strong, silent type. The
“danger” catchphrase is just a recording of Will’s own words, reprocessed and parroted back. Its 7-foot
hull is scarred from “hundreds if
not thousands” of years of previous
action and marked with mysterious
runes, Mr. Estrin says.
The robot is a walking Swiss
BY JOHN JURGENSEN
IN 1965, the future was a
lumbering silver robot with
astonishing computing abilities and a programmed instinct (“Danger, Will Robinson!”) to protect its human
companions.
After that “B-9” unit was
introduced in the television
series “Lost in Space,” fictional ‘bots evolved dramatically, from “2001” through
“The Terminator.” The real
versions have, too, including the
now-ubiquitous artificial-intelligence devices answering to names
like Alexa and Siri.
Technology’s drastically different role in the world is reflected in
a dark new version of “Lost in
Space,” set to begin streaming via
Netflix on Friday. This time
around, the robot has a murkier
agenda than its campy progenitor.
“Back in the day, robots were a
wish fulfillment,” says Zack Estrin,
an executive producer on the
show. “Now that it’s reality, we
have some concerns about the
technology and its effect on our
lives. It’s more like, ‘What’s hap-
‘Lost in Space,’ then and now: left, Bob May (as the robot) and Jonathan
Harris in the original series; above, cast of the Netflix version debuting Friday.
Army knife of weaponry and skills,
including super-strength and heat
generation, that are revealed during the 10-episode season and beyond, if the show is picked up for
additional seasons.
According to Mr. Estrin, “Lost in
Space” has the biggest visual-effects
budget of any show currently on
TV—at least until “Game of
Thrones” returns. The robot is created using a combination of physical
models, performance-capture animation and computer-generated effects.
Despite all its upgrades, the robot embodies a cinematic trope
that drove “E.T.,” “The Iron Giant,”
“The Black Stallion” and countless
DO THE ROBOT
other buddy tales.
“It’s a boy and his dog,” says
Kevin Burns, another “Lost in
Space” executive producer, who
was first riveted by the robot
when he watched the original
show as a 10-year-old.
The biggest challenge was coming up with a design for the robot
that looked both intimidating and
inviting, Mr. Estrin says. The only
direct reference to the original can
be seen in its face screen, where
colored lights shift based on its
mood and other conditions. Its default mode is a grayish glow, reminiscent of the ghostly hues on old
black-and-white TVs.
Catchphrases
Doesn’t talk much;
The Breakdown
The Breakdown
A B-9 Class M-3 General Utility Non-Theorizing
Environmental Control Robot, aka ‘Robot’
Not built on Earth
Face changes color
like a high-tech
mood ring
Catchphrase
‘Danger,
Will Robinson!’
Battle
Tested?
Scrapes
and
scratches
suggest
it’s been
around the
block
Years in
Service
2018-?
Accompanied By
Made a
Cameo In
Steven
Spielberg’s
new nostalgiafueled movie
‘Ready Player
One’
Abilities
Powerful
strength,
computing
and detection
abilities. Also
spouted lots
of expository
dialogue to
help viewers
keep up with
the plot.
Years in
Service
1965-1968
Getting Around
XX or XY?
Limited locomotion with treads at
the base of chunky legs
Gender-neutral
Weather
The WSJ Daily Crossword | Edited by Mike Shenk
Shown are today’s noon positions of weather systems and precipitation. Temperature bands are highs for the day.
40s
Vanco
Vancouver
Calgar
C
l ry
Calgary
50s
20s
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Edmonton
0s
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40s
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50s
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pls //St
St. P
Mpls./St.
Paul
oux FFalls
ll
Sioux
P
Pierre
60s
Reno
k
Milwaukee
t
Detroit
20
A g t
Augusta
22
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Boston
rtford
Hartford
ew Y
New
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60s
70s
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i
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C
Cl
l d
Cleveland
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Chicago
60s
h y
Cheyenne
Ph
hil d lph
h
50s Philadelphia
80s
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Omaha
Sacramento
Pittsbb h
Pittsburgh
Spring
p
g
d
Springfield
40s Denver
90s
60s
h
hi
ington
gton
D.C
DC
Washington
D.C.
60s
d
p
Indianapolis
an Francisco
San
C l d
Colorado
T p k
Topeka
Ch l t
Charleston
100+
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Richmond
L
Las
Kansas
p g
Springs
LLou
St.. Louis
L
Lou
ill
Louisville
h
Wichita
V g
C y
City
60s Raleigh
l igh
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80s Vegas
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Nashville
Ange
Los A
Angeles
C
h l tt
Charlotte
anta Fe
Santa
kl homa City
Oklahoma
phi
Memphis
Atl t
Atlanta
C
b
Columbia
100s Phoenix
Albuquerque
Ph
Warm
Rain
San Diego
Little Rock
90s Tucson
T c
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Birmingham
D
ll
Dallas
Ft. Worth
Cold
T-storms
J k
El Paso
b
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Mobile
70s Jackson
Jack
Jacksonville
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Austin
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New
20s
Stationary
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Orlando
70s
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Houston
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Tampa
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A t i
San
Honolulu
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Anchorage
50s
90s
90s Miami
80s
70s
U.S. Forecasts
Ice
City
Omaha
Orlando
Philadelphia
Phoenix
Pittsburgh
Portland, Maine
Portland, Ore.
Sacramento
St. Louis
Salt Lake City
San Francisco
Santa Fe
Seattle
Sioux Falls
Wash., D.C.
Today
Hi Lo W
61 43 pc
81 61 t
52 36 r
97 68 s
46 31 pc
43 30 c
62 47 r
68 48 c
52 42 pc
75 54 pc
64 52 c
71 41 s
58 46 r
54 37 pc
57 38 pc
Tomorrow
Hi Lo W
75 44 s
77 58 s
56 44 s
98 66 s
54 45 pc
47 35 s
52 42 r
64 42 sh
68 55 pc
70 51 pc
61 50 c
78 44 s
53 41 r
60 36 c
60 47 s
International
City
Amsterdam
Athens
Baghdad
Bangkok
Beijing
Berlin
Brussels
Buenos Aires
Dubai
Dublin
Edinburgh
Today
Hi Lo W
66 51 sh
72 55 s
88 62 t
96 80 s
76 47 s
72 53 pc
64 48 c
84 69 pc
91 77 s
48 45 sh
45 42 sh
Tomorrow
Hi Lo W
61 50 t
73 56 pc
86 61 s
95 81 s
76 48 pc
67 55 t
64 50 pc
81 52 t
93 79 s
51 44 pc
47 41 pc
City
Frankfurt
Geneva
Havana
Hong Kong
Istanbul
Jakarta
Jerusalem
Johannesburg
London
Madrid
Manila
Melbourne
Mexico City
Milan
Moscow
Mumbai
Paris
Rio de Janeiro
Riyadh
Rome
San Juan
Seoul
Shanghai
Singapore
Sydney
Taipei City
Tokyo
Toronto
Vancouver
Warsaw
Zurich
Today
Hi Lo W
67 48 sh
54 41 c
90 66 s
82 71 s
64 51 pc
90 78 c
59 47 pc
72 53 pc
60 46 sh
48 40 r
93 79 pc
81 62 c
76 52 pc
58 48 sh
65 35 pc
91 80 pc
60 46 pc
86 72 s
91 68 c
65 50 pc
85 74 sh
70 46 pc
85 63 s
90 79 c
75 66 pc
87 68 pc
64 58 s
43 28 pc
55 45 sh
76 52 t
67 38 sh
Tomorrow
Hi Lo W
67 50 pc
60 44 c
86 66 sh
83 75 pc
68 52 c
91 77 t
64 49 pc
66 52 t
59 46 pc
54 40 sh
94 80 pc
83 62 pc
70 54 pc
55 51 sh
47 28 s
91 81 pc
66 49 pc
85 73 pc
88 69 t
67 50 pc
86 75 s
62 43 s
78 59 pc
89 79 pc
81 68 s
91 71 t
69 61 c
47 35 pc
51 40 r
69 50 t
66 42 c
9
11
12
18
30
31
39
36
40
32
33
37
47
51
29 Wedding day
promise
30 Burger holder
31 “Absolutely!”
32 Processed food?
2 It has strings
attached
33 Sci-fi escape
vehicle
35 “Snap out of it!”
4 Key periods
43
46
28 Soft touch
3 “I can relate”
41
42
26 Drink cooler
61 Black ___ (covert
missions)
Down
1 “Casablanca”
star, familiarly
27
35
60 Cherry discard
62 Zodiac dozen
21
29
45
10
15
26
38
44
8
24
34
48
52
49
50
53
37 Relay segment
5 Went unused
40 Yale alum
6 Dentist’s
directive
41 Like some
notebook paper
54
55
56
7 Complete
autonomy
42 Lightening-theload stuff
57
58
59
8 ___ Plaines
60
61
62
9 Laughably odd
43 Jazz saxophonist
Rollins
IN GOOD COMPANY | By Zhouqin Burnikel
Across
1 Innocents in the
woods?
23 “Hart to Hart”
star Stefanie, to
fans?
6 Letters on
country letters
25 Blackjack table
request
9 Grifter’s racket
27 Swirling water
13 Covent Garden
production
28 Art collection
makeup
14 Begin to flag
30 Slant
15 Safekeeping
31 Maple yield
16 “Homeland” star
Claire, to fans?
34 TV spot seller
18 Barbecue joint
order
35 Round
container?
36 Victim of a 2006
demotion
19 Charged particles
38
Sock tip
20 Trick
39
Discerning
21 Port of northern
Italy
22 Dr. for laryngitis
sufferers
43 Prolonged
attack
44 Singer Neil, to
fans?
48 Org. with
PreCheck
screening
51 Exchanges
words, at times
52 Heredity unit
53 When compared
with
54 Twists the truth
55 TV chef Julia, to
fans?
57 “Livin’ la
Vida ___”
41 Looked lustfully
58 Like deep-fried
turkey
42 Abandon at the
altar
59 Summer camp
craft
Solve this puzzle online and discuss it at WSJ.com/Puzzles.
s
s...sunny; pc... partly cloudy; c...cloudy; sh...showers;
t...t’storms; r...rain; sf...snow flurries; sn...snow; i...ice
Today
Tomorrow
City
Hi Lo W Hi Lo W
Anchorage
48 39 pc 47 36 c
Atlanta
67 43 pc 68 48 s
Austin
75 47 s
83 58 s
Baltimore
55 34 pc 57 43 s
Boise
65 46 c
60 37 c
Boston
44 33 c
48 39 s
Burlington
44 26 r
49 34 pc
Charlotte
66 43 pc 66 46 s
Chicago
47 37 pc 60 53 pc
Cleveland
44 32 pc 57 47 pc
Dallas
71 50 s
81 60 s
Denver
70 46 pc 76 51 s
Detroit
48 33 pc 57 47 c
Honolulu
81 73 pc 82 73 sh
Houston
76 51 s
79 57 s
Indianapolis
49 33 pc 60 51 pc
Kansas City
57 45 pc 71 51 s
Las Vegas
92 69 pc 90 60 s
Little Rock
61 39 s
73 52 s
Los Angeles
84 59 pc 73 54 s
Miami
88 71 pc 83 69 sh
Milwaukee
45 38 pc 56 46 c
Minneapolis
43 29 sf 50 37 c
Nashville
59 35 pc 68 50 s
New Orleans
73 54 s
73 54 s
New York City
50 37 pc 54 44 s
Oklahoma City
66 47 s
77 61 s
Flurries
Showers
25
28
7
23
50s
Salt La
Lake
L
Cit
C tyy
City
40s
6
14
19
A bany
b
Albany
30s
5
30s
30s
l
Buffalo
4
40s
40s
Montreal
Ottawa
T
Toronto
3
17
20s
40s
l
Helena
2
16
ip
Winnipeg
60s
1
13
10 Olivier’s “Sleuth”
co-star
44 Cuts down
11 Shady alcove
46 Emma Roberts,
to Julia
45 Numbskull
12 Flat-topped hills
47 Soup kitchen
offerings
14 Hosiery shade
17 Instruments in a
kit
49 Beauty spot
21 “Best of luck to
you!”
50 World’s longest
mountain range
23 Members of a
blended family
53 Spicy Asian
cuisine
55 Slimy stuff
24 Making out on
the bus, e.g.:
Abbr.
56 Keeps in the
email thread
Previous Puzzle’s Solution
G
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CLOCKWISE FROM TOP RIGHT: NETFLIX (2); 20TH CENTURY FOX/EVERETT COLLECTION
Flailing his arms
.
THE WALL STREET JOURNAL.
A12 | Tuesday, April 10, 2018
JONATHAN HAYWARD/PRESS POOL
SPORTS
Flowers lie at center ice as people gather for a vigil at the Elgar Petersen Arena, home of the Humboldt Broncos, to honor the victims of a fatal bus accident.
HOCKEY | By Jason Gay
Tragedy and a Team
A horrific collision in Canada involving a hockey bus shakes a country—and all of sports
The games are the
games, but what really
bonds a team are the
hours in between: the
practices, locker
rooms, dinners, bus
rides. Especially those bus rides.
On the bus, you can discover a
lot: if the team is loose, confident, anxious, divided or tightly
knit. You can watch from the
stands for an entire season, and
never truly understand a team’s
dynamic, its heart.
On the bus, you can learn everything you need to know.
By now, you’ve surely read about
what happened, or, more devastatingly, seen the photographs: of a
collision Friday in Saskatchewan,
involving a tractor-trailer and a
bus carrying the Humboldt Broncos, a Canadian junior hockey
team. At least 14 people on the bus
were injured, and 15 were killed,
including the head coach, assistant
coach, play-by-play broadcaster,
statistician, bus driver—and 10
players, aged 16 to 21.
Adam. Jaxon. Conner. Stephen.
Evan. Jacob. Parker. Three Logans—Logan Hunter, Logan Schatz,
Logan Boulet.
Brody. Mark. Tyler. Glen. Darcy.
The unthinkable, made real.
“The worst nightmare has happened,” said Bill Chow, the president of the Saskatchewan league
in which the Broncos played.
As the Journal’s Kim Mackrael
reported from Humboldt, the
hockey team is thoroughly embedded into the small, population-5,800 farming and potashmining town. “They’re our boys,”
one resident told Mackrael.
“They’re everybody’s boys.”
Days later, the sorrow continues, as does the shock. On Monday, word arrived that a player
misidentified as dead (Xavier Labelle) was, in fact, alive—which, in
turn, meant a teammate identified
as a survivor (Parker Tobin) was
actually dead.
It’s horrifying, all of it.
“It’s got to rip the heart out of
your chest,” said the Toronto Maple Leafs head coach Mike Babcock,
who grew up in nearby Saskatoon.
This tragedy cuts to the core of
the sport and the whole of Canada.
But you don’t have to know them
to mourn them. Their deaths are
agonizingly relatable. The bus is a
way of life in sports, at almost every level—from arena to arena,
school to school, city to city. Those
rides can be tedious, but also essential—there are conversations,
songs, movies, naps, jokes. Friendships are made. Talk to a pro athlete, and what they often recall
about their early days is not what
happened in the games, but those
long, humble bus rides.
“Everyone in hockey knows how
much time you spend traveling
around on buses,” said the NHL
superstar Connor McDavid. “It
never even came across my mind
that something like that could
happen while I was on the bus.”
That’s really it, isn’t it? What
athlete steps on a team bus thinking that this will happen? Even in
our ordinary lives, we treat safe
passage as a given, getting from
point A to point B. Tragic accidents do occur—but they’re
quickly compartmentalized. Parents worry about their children,
but hide it in the backs of their
minds. It’s human. To worry too
much is to live in fear.
There was another tragedy in
sports over the weekend, in the
Paris-Roubaix bicycle race in
France. A 23-year-old rider named
Michael Goolaerts was involved in
a crash and went into cardiac arrest. His team announced his death
Sunday night, and it sent a chill
through the sport. Bike racing can
be dangerous, and to enjoy it—not
to mention compete in it—you
have to tuck away the chance that
something like this could happen.
When it does happen, it exposes
a vulnerability that’s difficult to
confront.
Goolaerts was a young rider, talented enough to get the call to
race in a major event like ParisRoubaix. Now he’s gone. And yet
bike racing continues.
In Humboldt, they have begun
the process of paying tribute to the
fallen. On Sunday, there was a vigil
attended by Canada’s Prime Minister Justin Trudeau. The Broncos
team pastor, Sean Brandow, spoke.
Brandow had come upon the crash
scene in his own car, and was still
processing what he’d encountered.
His words were anguished and raw.
“[I] walked up on a scene that I
never want to see again, to sounds
I never want to hear again,” the
pastor said. “To go to the hospital
and walk around and just hear
groaning and panic and fear and
distress and pain, just nothing but
darkness. To sit and hold the hand
of a lifeless body.”
Brandow made reference to
Psalm 23:4: “That’s all that went
through my head, ‘This is it, this is
the valley of death, this is the valley of darkness.’ And all I saw was
darkness. All I saw was hurt and
anguish and fear and confusion.
And I had nothing. Nothing. I’m a
pastor, I’m supposed to have
something.”
There are no perfect words, no
easy path forward. There may
never be. Brandow said he believed healing is possible, but
scars would always remain.
Meanwhile, there are gestures of
kindness and hope. An internet
fund set up for players and their
families has already raised more
than $5 million, much of it from
strangers. Across the world, hockey
fans are taking out their hockey
sticks and putting them in front of
their homes—a stark tribute to
lives lost, and a sport in grief.
And in the hospital, the injured
Humboldt Broncos are fighting to
recover. A recent photograph of
the Broncos, taken not long before the collision, showed the
team happily posing in dyed
blond hair—a move of playoff
unity, like those lumberjack
beards their NHL idols grow.
A new photo released over the
weekend showed three Broncos in
their beds and hospital gowns and
blond hair. They were holding
hands, in courage and friendship,
bonded as hockey players—and
riders from that bus.
A team, forever.
THE MASTERS
BY BRIAN COSTA
WHEN TIGER WOODS teed off at
the Masters last week, the immediate surge of interest was predictable.
Ratings for ESPN’s first-round coverage, which came on the air after
Woods was done for the day, were
up 40% from a year before. A day
later, with Woods’s afternoon tee
time within the broadcast window,
the spike was 55%.
But the most telling indication of
the state of pro golf might have
come over the weekend. With
Woods falling from contention, CBS
still drew a 24% higher rating for
the third round than it did in 2017.
On Sunday, when Woods was nearly
done by the time the Masters went
on the air, the final-round rating
jumped 14% from the year before.
Those increases, at a time when
traditional television viewership
across the board is trending downward, are the byproduct of a perfect storm in golf.
Behind Woods and Phil Mickelson, a new generation of stars has
matured to the point where it isn’t
even that new anymore. Jordan
Spieth is a three-time major champion. Rory McIlroy won his first major seven years ago. Rickie Fowler
will turn 30 years old this year.
Yet just as the game seemed less
in need of Woods and Mickelson’s
drawing power than ever, those
two have reemerged as threats to
win tournaments. Though Woods
wasn’t great at the Masters—he
tied for 32nd place—his health and
play suggest he isn’t going away
again anytime soon. Ditto that for
Mickelson, who tied for 36th.
It’s akin to Major League Baseball
watching Bryce Harper and Mike
Trout come of age, only to suddenly
have Derek Jeter back on the field.
And it is perhaps only possible in
golf, which remains unique in its
agelessness even as PGA Tour winners trend younger overall.
“I think the addition of Tiger be-
Patrick Reed held off a loaded leaderboard to win the Masters on Sunday.
ing healthy and playing well, no
matter what else happened, was
probably going to make it as anticipated as any [Masters] going back
five, six, seven years,” Spieth said.
“But then Phil winning recently,
Rory winning recently…there’s just a
lot of guys playing really good golf
that create story lines in general.”
Woods may remain the ultimate
magnet for attention, but the generation of players that grew up watching him is more than holding its
own. With Patrick Reed’s win at Augusta National on Sunday, all four
current major champions are Americans between the ages of 24 and 27.
Spieth, 24, won last year’s British Open. Justin Thomas, 24, won
the PGA Championship. And Brooks
Koepka, 27, won the U.S. Open.
Rarely does a major champion-
ship showcase both the best-known
aging greats on the tee sheet and
nearly all of the best young players
in the game near the top of the
leaderboard. But this Masters
served as the best proof yet of
what golfers themselves have been
saying for a couple of years: The
depth at the top of the sport is as
good as it has ever been.
At one point late in the final
round on Sunday, the top 11 players on the leaderboard included
the Nos. 1, 2, 3, 4, 5, 7 and 8 players in the world rankings. Golf is
supposed to be flukier than that.
It was the rare golf major that
couldn’t lose no matter who won,
even if Reed was the last contender that most people were
rooting for. And it pointed to
where golf is heading in 2018:
AUGUSTA, Ga.—In scientific
terms, the crowds here went bananas as Jordan Spieth and Rickie
Fowler made charges for the lead
during the final round.
But even their extraordinary performances weren’t enough to catch
Patrick Reed at this year’s Masters.
There was only one person who
could be realistically expected to
match or surpass his winning score
of 15 under par.
Rory McIlroy’s most glaring flaw—
putting—didn’t just leave him barely
short. His struggles on the green took
out of contention the single golfer
with a reasonable chance to catch
Reed. And the outcome underlines
why one of the game’s most talented
golfers hasn’t won a major since
2014: Some days, it really doesn’t
matter how well he can hit the ball if
he can’t putt the ball in the hole.
Reed entered the day at 14 under. McIlroy was three shots back.
Everybody else was at least five
strokes back. It took Spieth carding
an 8 under 64 to finish the tournament within two. Fowler also turned
in one of the best days with a 67 to
finish second and one back.
The hopes for the rest of the field
largely hinged on Reed faltering. He
didn’t. He posted his highest score of
the tournament, a 71, but that was 1
under and reasonably enough to fend
off almost everybody.
That almost includes everybody
but McIlroy, who charged on Saturday to put the pressure on Reed.
McIlroy knew well the pressure his
counterpart faced—because he had
gone through it. In 2011, McIlroy
had a four-shot lead going into
Sunday at the Masters. He fell
apart that final round in the most
extraordinary fashion. He didn’t just
lose. He shot an 80. He triple boheadlined by Woods, but led by a
generation that is proving ever
more capable of both winning trophies and attracting eyeballs.
Even Fowler, who finished one
shot behind Reed, seems closer
than ever to winning his first ma-
Rory McIlroy reacts after a missed
putt during Sunday’s final round.
geyed the 10th hole, and it unraveled more from there.
This time, McIlroy wasn’t in first.
He was in second. And this collapse
won’t become part of Augusta National lore, but it’s the more telling
revelation about the state of his
game.
“I’ll sit down and reflect over the
next few days and see what I could
have potentially done better,” McIlroy said.
In the final round, McIlroy ranked
53rd in strokes gained putting.
Which is problematic because only
53 players made the cut. He ultimately finished with a 74 and finished tied for fifth, at 9 under and
six shots behind Reed.
These problems aren’t anything
new. Last year, he ranked 140th in
strokes gained putting. And 135th
the year before that.
That he could rate so poorly and
still be one of the best golfers in
the world for all of this time is possibly the best testament to just
how good he is at everything else—
and how dangerous he might be if
he ever solves his putting woes.
—Andrew Beaton
jor. “I am ready to go win a major,” he said. “But this was kind of
the first week that I’ve understood
that and known that and felt that.”
The U.S. Open is two months
away. “Should be a very good major season,” Fowler said.
L-R: PATRICK SMITH/GETTY IMAGES; MIKE SEGAR/REUTERS
GOLF’S PERFECT STORM
Putting Woes Sink
Rory McIlroy
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | A13
OPINION
Bolton Faces a Dangerous World
Welcome to
the
White
House,
Mr.
Bolton. Not
since
the
1940s has a
national secuGLOBAL
rity adviser
VIEW
faced an array
By Walter
of challenges
Russell Mead
this urgent,
this numerous
and this perplexing.
Five distinct threats will
compete for John Bolton’s attention as he settles into
Henry Kissinger’s old digs:
First, North Korea’s drive toward nuclear weapons that
threaten the U.S. has reached
a critical juncture. Second,
China’s militarization of the
South China Sea coincides
with a crisis in U.S.-China
trade relations. Third, Russia’s efforts to disrupt the
Western alliance system and
re-establish itself as a major
power in the Middle East
have progressed to the point
that not even Donald Trump
can ignore them. Fourth,
Iran’s push to consolidate its
gains in Syria and Lebanon
has alarmed and provoked Israel and its once-hostile Arab
neighbors. Fifth, Islamist terrorism continues to lurk in
the shadows, threatening to
emerge at any moment and
force Western governments to
respond.
As the White House considers these threats, its options
are constrained. Seventeen
years of indecisive war has left
a polarized American public
weary of global engagement.
The midterm elections may
yield a “blue wave” that forces
the president into a defensive
crouch to fend off investigations and perhaps even impeachment by a Democratic
Congress. The press is deeply
hostile to the Trump administration and unwilling to grant
it the benefit of the doubt in
foreign policy. Traditional alliances are strained: Europe and
Asia worry that an “America
First” administration is less
valuable and reliable as a
partner; Turkey, meanwhile,
flirts with a revisionist confederation with Russia and
Iran.
Compounding the challenge
is that adversaries world-wide
share an interest in keeping
Uncle Sam off-balance. North
Korea, China, Russia, Iran and
the jihadists don’t operate on
a single master plan, but this
common interest leads to a
kind of informal coordination.
Crises may erupt at inconvenient times for the U.S. precisely because they are inconvenient times for the U.S.
Then there is Mr. Bolton’s
boss. Donald Trump is not interested in subordinating his
improvisational leadership
style to the demands of any
Washington routine. He believes that the foreign-policy
establishment is deeply
flawed, that the career bureaucracy actively seeks to
undermine his administration, and that many of the
basic principles that have informed American thinking
abroad for 70 years need to
be discarded.
As national security adviser,
Mr. Bolton sits where the rubber of presidential spontaneity
meets the road of the institutional foreign-policy process.
Mr. Bolton’s unenviable but
critical task is to bring some
kind of order to the most chaotic administration in recent
memory, which is confronting
the most dangerous international situation since the Truman administration.
He joins the chaotic
Trump team amid the
greatest uncertainty
since Truman’s era.
Mr. Bolton will have some
help. Mike Pompeo, whom Mr.
Trump has nominated for secretary of state, will substantially strengthen the nationalsecurity team, assuming the
Senate confirms him. Mr.
Pompeo is well-suited to be
the administration’s voice on
foreign policy. Rex Tillerson—
understaffed, consumed by internal State Department battles, and at odds with the
president on many issues—
was unable to fulfill this role.
Under Mr. Pompeo, the machinery and presentation of
policy are likely to run more
smoothly, allowing the State
Department’s expertise to be
more usefully deployed in the
service of policy goals.
Developments in two regions are likely to dominate
Mr. Bolton’s inbox in the
coming weeks. In East Asia,
he will need to try to mix carrots and sticks to bring stability back to U.S.-China relations, while managing the
run-up to Mr. Trump’s highstakes negotiations with Kim
Jong Un. In the Middle East,
Mr. Bolton will look for ways
to push back against Iran
while persuading Russia that
all-out opposition to the U.S.
in the region carries too many
costs to be worth it.
President Trump and Mr.
Bolton are on record as wanting to withdraw from the 2015
nuclear deal with Iran. Accomplishing this without losing
British and French support for
a robust policy to counter
Russia and Iran in the Middle
East will be an early test of
Mr. Bolton’s savvy. In April,
French President Emmanuel
Macron and German Chancellor Angela Merkel will visit
Washington, giving Mr. Bolton
a chance to build relationships
with vital allies. While the
French are more flexible than
the Germans, both countries
are strongly committed to the
Iran deal.
John Bolton’s many critics
will be quick to pounce if, as
seems likely, his early months
in the job prove tempestuous.
At this point, that’s almost a
given. The question isn’t
whether Mr. Bolton’s tenure
will be dramatic and eventful;
the question is whether he
can steer the ship of American foreign policy through a
storm that was building long
before he was called to the
helm.
New Yorkers, Meet the New Nixon
A n d r e w
Cuomo was
once married
to a Kennedy.
Now
New
York’s governor
finds
MAIN
himself runSTREET
ning against a
By William
Nixon.
McGurn
The Nixon
challenging
Mr. Cuomo in the Democratic
primary is Cynthia Nixon of
“Sex and the City” fame. As an
actress she played the no-nonsense Miranda. As a candidate, her progressivism recalls
that of Sen. Bernie Sanders—
and is destined for the same
outcome.
“I voted for Andrew Cuomo
because I believed that he was
a real Democrat,” Ms. Nixon
said in her first speech after
announcing her candidacy.
“But since taking office, he has
shown us his true colors.”
With a nice Trumpian
flourish she added, “If Washington is a swamp, then Albany is a cesspool.”
Just as Mr. Sanders questioned Hillary Clinton’s character during the 2016 Democratic presidential primaries,
Ms. Nixon is targeting Mr.
Cuomo’s. “In the corruption
Olympics that is Albany,” she
says, “I think Andrew Cuomo
is winning himself some gold
medals.”
Ms. Nixon has even come
out against New York tax subsidies that benefited her own
“Sex and the City” movies.
The results, she rightly says,
just aren’t worth it.
So why write her off? The
answer in good part has to do
with the structure of New
York’s politics, which Mr.
Cuomo understands and she
does not. As much as Ms.
Nixon may believe she is leading a Bernie-like populist insurgency for the soul of the
Democratic Party, the unions
that are the real power in New
York may see her candidacy as
a good way of keeping the
governor in line.
At the center of this dynamic is the Working Families
Party. Founded by a coalition
of labor unions and activists
from groups such as Acorn
(the Association of Community Organizations for Reform
Now) the WPF is the same
party America’s self-styled
progressive in chief, Bill de
Blasio, used to get himself
elected mayor of New York
City.
Here’s what gives the party
its real power: New York is
one of the few states where
minor parties are allowed to
cross-endorse candidates who
are also running on other parties’ lines. This gives marginal
political parties something
valuable to trade.
Notwithstanding their competition for the Democratic
nomination, both Mr. Cuomo
and Ms. Nixon want the WFP’s
ballot line as well. In a Monday
editorial, the New York Post
rightly noted that “if the WFP
truly is a party of principles, it
shouldn’t hesitate on endorsing Nixon.” She is, after all, the
progressive in this race. And
the WFP ballot line would be
crucial if she hopes to run
against Mr. Cuomo in November even if she ends up losing
the Democratic primary.
Here, alas, Miranda-like
reality intrudes. Working
families have nothing to do
with the Working Families
Party. The WFP is beholden
The ‘Sex and the City’
star running against
Cuomo is tanned,
ready and rested.
to the unions. And to them,
Ms. Nixon’s primary utility
lies in keeping Andrew
Cuomo “honest”—that is,
getting him to do what they
want him to do.
Thanks to the scare Zephyr
Teachout gave the governor in
the 2014 primary, they’ve already enjoyed some success.
The relatively unknown Ms.
Teachout, a progressive Fordham law professor, captured
more than a third of the Democratic vote. Mr. Cuomo then
cut a deal with the WFP to get
his name, and not Ms. Teachout’s, on the WFP line on
the November ballot.
It’s doubtful Mr. Cuomo
will make the same mistake
with Ms. Nixon that he did
with Ms. Teachout. Take education spending, Ms. Nixon’s
signature issue. Mr. Cuomo
entered office saying that
“more money” wasn’t the answer. These days he tells us
how “very proud” he is that
New York spends more per pupil than any other state.
Meanwhile, the frosty relations between Mr. Cuomo and
the teachers unions are beginning to thaw. Last month the
governor took his place in a
student protest against gun violence that included Michael
Mulgrew, the United Federation of Teachers boss, and
Randi Weingarten, the American Federation of Teachers
president. Nor do we hear
much any more from Mr.
Cuomo about the charter
schools he once championed.
Other union-backed causes
have likewise been rewarded.
Two years ago, Mr. Cuomo
signed the $15-an-hour minimum wage pushed by 1199
SEIU, among the state’s largest
and most powerful unions.
In other words, as much as
progressives and rank-and-file
Working Families Party members may doubt Mr. Cuomo’s
good faith, he will do whatever
it takes to ensure no rival
flanks him from the left.
So while a WFP endorsement for Ms. Nixon makes
sense on principle, the unions
are not likely to let that get in
the way of their interests. Were
the party to nominate Ms.
Nixon, it would split the Democratic vote—possibly enough to
allow a Republican to squeak
through to victory.
Ms. Nixon’s challenge to
Mr. Cuomo will provide some
highly entertaining moments.
Unfortunately the actress
doesn’t seem to realize she’s
being cast for a losing role.
Write to mcgurn@wsj.com.
Food Stamps Shouldn’t Pay for Junk
By Moby
T
he Food Stamp Program started as a way
to help people whose
shelves were empty. It certainly helped my family. My
mother was a single parent
who struggled to make ends
meet in wealthy Darien,
Conn., during the 1970s. We
relied on food stamps until I
was 16.
Since then, the program
has grown considerably. Renamed the Supplemental Nutrition Assistance Program, it
supported more than 40 million Americans in 2017. Even
though SNAP is generally
well-intentioned, what it puts
on shelves is not always helpful or healthy. SNAP rules allow stores to distribute
candy, soda, cheese products,
energy drinks, processed
meats and lots of other items
that end up seriously compromising the health of SNAP
recipients.
The program’s price tag is
around $70 billion a year.
That’s high, but the costs to
human health are much
higher. An October 2017 study
in the American Journal of
Preventive Medicine found
that SNAP participants have
worse diets than nonparticipants. U.S. Department of Agriculture data show that SNAP
participants are more likely to
SNAP is vital to the
poor but too often
bad for their health.
be obese than people at the
same income level who don’t
participate in the program.
According to the Centers for
Disease Control and Prevention, poor people are 70%
likelier to develop diabetes—a
disease that puts them at risk
for heart problems, blindness
and early death.
Who benefits? Large industrial food producers love a
program that obliges the government to pay for anything
and everything they produce.
Selling soda, candy and
heavily processed meats is
easy when the government
picks up the tab. Under
SNAP, the big food conglomerates go to the bank while
the poor end up in the emergency room.
Right now, a congressional
arm-wrestling match is pitting those who want to preserve funding for SNAP
against those who want to
gut it. As I can attest from
my childhood experience,
SNAP really does help feed
poor people, and no one
wants to return to the days
when America turned a blind
eye to hunger. But it also
puts a lot of unhealthful food
on America’s plate. Its costs
are huge, as are the added
costs of treating diabetes, hypertension and other illnesses that poor eating habits cause.
To reduce SNAP’s costs,
some have pushed stricter
work requirements. This is
silly; most SNAP participants
are either children or elderly.
A better approach would be
to focus the program on
cheap, healthy foods like
beans, vegetables, fruit and
whole grains.
The food industry pushes
the notion that poor people
demand junk food and will
complain if SNAP cuts them
off. In reality, parents like my
mother take pride in doing
the best they can for their
families. Being poor can involve shame, as well as a commensurate longing for pride.
Nothing delivers a greater
sense of pride than helping
your children succeed and doing your best to see that they
grow up healthy.
Congress should fix SNAP,
not gut it. The U.S. can have
healthier people, lower healthcare costs, and a trimmer budget at the same time.
Moby, who was born Richard Melville Hall, is a musician, DJ and author. He has
been nominated for six
Grammy Awards.
BOOKSHELF | By Michael Barone
On the Docket,
Social Change
Eisenhower vs. Warren
By James F. Simon
(Liveright, 427 pages, $35)
‘I
t would be unfortunate,” Chief Justice Earl Warren told
fellow justices ahead of the Brown v. Board of Education
decision in 1954, “if we had to take precipitous action
that would inflame more than necessary.” Two years later,
when asked about Southern whites’ resistance to school
integration, President Dwight Eisenhower replied: “We must
be patient without being complacent, . . . we must be understanding of other people’s deep emotions as well as our own.”
“Patient,” not “precipitous”: Those were the instincts of
both Warren and Eisenhower toward the desegregation of
Southern schools in the 1950s. Their approaches had more in
common than you might expect from the title of law
professor James F. Simon’s “Eisenhower vs. Warren” or from
its account of Ike’s private grumblings and Warren’s
autobiographical complaints. For they were dealing with a
genuinely difficult problem: how to dismantle the iron
system of racial segregation supported overwhelmingly by
Southern electorates (from which blacks were mostly
excluded) in thousands of schools with millions of students.
Both men had grown up
in small towns with few
blacks—Eisenhower in
Abilene, Kan., Warren in
Bakersfield, Calif. As Mr.
Simon notes, Eisenhower was
the more liberal of the two.
During his postwar tenure as
president of Columbia University, he had upheld freedom of
speech on campus while Warren,
as governor of California in 1950,
had supported a loyalty oath for
University of California professors. During World War II, Eisenhower granted segregated black units’
requests for combat duty while Warren in 1942
campaigned for the internment of Japanese-Americans.
In any case, both men had concluded, by the late 1940s,
that the rigidly and sometimes violently enforced racial
segregation system of the South was unjust and undermined
America’s reputation in the world. As U.S. president,
Eisenhower quickly moved to end segregation in federal
realms—in the military (effectively carrying out Harry
Truman’s desegregation order), in federal installations like
the Charleston, S.C., shipyard, and in the District of
Columbia. When Chief Justice Fred Vinson died suddenly in
September 1953, Eisenhower appointed Warren, who as a
three-term governor had opposed racial discrimination.
Awaiting on the Supreme Court docket was the Brown v.
Board of Education case challenging the constitutionally of
public-school segregation. Before Warren’s appointment, the
court had been split 5-4 in favor of rejecting the challenge,
with Vinson supplying the critical vote (or so Mr. Simon
surmises from incomplete evidence). Warren could swing it
the other way. Attorney General Herbert Brownell, with
Eisenhower’s concurrence, submitted a brief arguing that
school segregation was unconstitutional. Thurgood Marshall,
lead counsel for the plaintiffs, assured the court that the “rank
and file people in the South” would accept desegregation.
The president and the chief justice faced a
difficulty: how to dismantle a system of racial
segregation supported by Southern electorates.
Not all the justices were so sure. Mr. Simon presents a
vivid account of how Warren deferred an immediate
showdown, schmoozing the Texan Tom Clark, parrying the
judicial-restraint theories of former professor Felix
Frankfurter, facing down the doubts of the eloquent Robert
Jackson (who was perhaps echoing the arguments of his law
clerk William Rehnquist). Then, with eight votes in hand,
Warren persuaded the Kentuckian Stanley Reed, against his
own convictions, to join the others and make the decision
unanimous. Brown v. Board of Education was announced in
May 1954. Eisenhower said he would obey it but offered no
opinion on whether the decision was correct.
There was a cost to arriving at unanimity. To get all nine
votes, the court had agreed to hear a second case, also called
Brown v. Board of Education—dubbed “Brown II.” It had to
do with the details of implementing the first decision. The
Justice Department submitted a brief calling for terminating
segregation “as quickly as possible” and ordering federal
courts to require desegregation plans within 90 days. As Mr.
Simon relates, Solicitor General Simon Sobeloff presented
the brief personally to Eisenhower, who made minor editing
changes (“feasible” for “possible”) and approved it.
Marshall’s brief similarly called for immediate desegregation
and a September 1956 “outer limit” for compliance.
The unanimous Brown II opinion, drafted by Warren, did
not go as far as urged. Conspicuously absent were Sobeloff’s
90-day requirement and Marshall’s September 1956 deadline.
Southern politicians vowed to resist desegregation as long as
possible. The court, it seemed, had given them time to do so.
To the end of his days, Warren was bitter at Eisenhower’s
refusal to declare that Brown was rightly decided. Perhaps
had he done so, the resistance of Southern whites would
have melted away quickly. But more likely not. Eisenhower
did say that he would enforce the decision, and when
Arkansas Gov. Orval Faubus blocked a desegregation order in
Little Rock, Eisenhower federalized the National Guard and
sent in the 101st Airborne.
The fact is that Eisenhower and Warren were both acting
under political constraints—something that Mr. Simon, in his
gripping account, describes generously in Warren’s case but
somewhat more grudgingly in Eisenhower’s. Eisenhower was
a politician who in 1952 had won 49% in the South and
wanted to do even better in 1956 (he got 50.2%). A plunge in
his job approval would weaken his ability to govern. As it
was, as Mr. Simon notes, the Southern federal judges he
appointed did yeoman work insisting on desegregation.
Warren was constrained by his statesmanlike desire for
unanimity. The price was delay. It required the work of a
brilliantly led civil-rights movement, passage of the 1964
Civil Rights Act over a dramatic filibuster and the hammer
of the Voting Rights Act a year later to dismantle the
segregation system. And it was the administration of
Richard Nixon, whom Eisenhower disdained and Warren
loathed, that finally ended segregation in the schools.
Mr. Barone, senior political analyst at the Washington
Examiner and resident fellow at the American Enterprise
Institute, is the author of “Our Country: The Shaping of
America From Roosevelt to Reagan.”
.
THE WALL STREET JOURNAL.
A14 | Tuesday, April 10, 2018
OPINION
T
REVIEW & OUTLOOK
LETTERS TO THE EDITOR
Republican Spending Reprieve
More Labor Mobility Would Help to Fill Jobs
he Congressional Budget Office finally
Democrats will also cry that the GOP is rerolled out its semiannual budget out- neging on a spending deal, but Democrats used
look on Monday, and the federal deficit their leverage with the 60-vote filibuster rule
is expected to be $804 billion
to coerce more non-defense
Congress can claw back spending. Republicans would
this fiscal year and is heading
toward $1 trillion by 2020.
now use their power under
some of its spending
That should concentrate the
the Budget Act to claw some
with rescissions.
minds of Republicans to use
of that back. This is using letheir power to rescind at least
gitimate political leverage unsome of the excess spending in
der the law.
the recent blowout omnibus budget bill.
Republicans have been getting pounded by
The Congressional Budget and Impoundment their voters for passing a Democratic budget,
Control Act of 1974 is a bad law that has made with the exception of defense, despite having
it hard for the GOP to repeal ObamaCare or re- GOP majorities. A rescission vote can restore
form other entitlements. But a corner of the some of the political accountability that the filstatute lets the President request that certain ibuster blurs.
discretionary (that is, non-entitlement) funds
House Republicans are already discussing
not be spent even though they have been appro- possible rescissions, and it’ll take finesse to
priated. Congress then has 45 days to approve command a majority. Senate Republicans will
the rescission request. If Congress fails to act, be even less thrilled given their narrow 51-vote
the spending proceeds. A rescission package is majority. But one reason Republicans are at posubject to limited debate and requires only a 51- litical risk of losing in November is the lack of
vote majority in the Senate.
enthusiasm among their voters, and a fight
This has the potential to undo some of the over spending restraint would show grassfiscal damage in this year’s 2,232-page, $1.3 tril- roots Republicans that it matters who controls
lion spending bill. The GOP felt obliged to ac- the House and Senate next year.
cept huge increases in domestic discretionary
Congress and the White House will also
spending in exchange for a modest and long- have to work together on a consensus package
needed increase for defense. For example, the of what to rescind. The worst case would be
omnibus included $13.7 billion more for trans- for a rescission proposal to get public attenportation and housing in 2018 than what the tion but then fail as Republicans defect or Mr.
House passed in appropriations bills. The deal Trump wigs out. Cooperation isn’t impossible.
featured large increases for environment, labor, The Administration and Congress managed to
health and more, none of which were pinched work together last year to repeal more than
for cash before this gusher.
a dozen Obama-era regulations under the
Democrats are acting like rescission is a Congressional Review Act, and some votes
novel or extralegal idea, but it isn’t. Presidents were close.
have proposed 1,178 rescissions since 1974, acPresident Trump should be on board after
cording to the American Action Forum’s Gor- announcing how unhappy he was to sign the
don Gray. Congress agreed to only 461, and 101 omnibus to get more dollars for defense. “I will
were in 1981 thanks to Ronald Reagan. The total never sign another bill like this again,” the
amount rescinded over the years comes to President threatened at the signing. But if the
about $25 billion out of $76 billion proposed GOP loses the House in the fall, Mr. Trump will
by Presidents. Bill Clinton in 2000 was the last be signing bills so big he’ll be sick of losing. A
President to propose rescissions.
fight over spending restraint is worth having.
T
Trump’s Russia Blacklist
he Trump Administration announced stock index fell more than 8%. Rusal’s shares lost
sweeping sanctions on Vladimir Putin’s some 50% in Hong Kong trading.
inner circle Friday, and the news deserves
The Treasury order has particular implicamore attention. The sanctions
tions for Europe. Gazprom is
New sanctions target
hit the Kremlin’s cronies where
developing the Nord Stream II
it hurts—their fortunes.
gas pipeline that would give
Putin’s cronies
Treasury blacklisted seven
Moscow leverage over Euroin the pocketbook.
oligarchs, 14 companies and
pean energy supplies.
17 government officials for
One reason Mr. Putin has
engaging “in a range of mabeen able to stay in power is
lign activity,” including the occupation of his ability to make his friends rich. But if their
Ukraine’s Crimea, aiding Syria’s Bashar Assad, association with the Kremlin confines them to
meddling in the 2016 U.S. election, and more. business in Russia, Mr. Putin’s patronage beThe blacklist includes Putin son-in-law Kirill comes far more problematic. Moscow said the
Shamalov, industrial tycoon Oleg Deripaska, sanctions are “unacceptable” and “illegitimate,”
Gazprom executive Alexei Miller, Interior Af- but the Kremlin lacks America’s financial and
fairs Minister Vladimir Kolokoltsev, and Rusal, economic leverage.
the giant aluminum producer.
The sanctions are more evidence of a toughThe order freezes assets subject to U.S. juris- ening U.S. policy toward Russia. While Mr.
diction, prohibits Americans from dealing with Trump has been reluctant to criticize Mr. Putin,
the individuals and companies, and threatens he has sold lethal weapons to Ukraine, moved
sanctions against “non-U.S. persons” who facili- NATO military assets to the east, and expanded
tate “significant transactions” for the Russians. U.S. energy production to give Europe an alterA sign of the impact is that the ruble fell nearly native to Gazprom. Perhaps Mr. Trump’s critics
4% against the dollar Monday, and Russia’s main should give him some credit.
D
A Nafta Poison Pill
onald Trump’s rewrite of the North
This is bizarre: Nafta lets American compaAmerican Free Trade Agreement is sup- nies allocate capital to its best use on the contiposed to tilt the 24-year-old pact toward nent and thus strengthen U.S. productivity and
American commercial interests.
competitiveness.
Lighthizer thinks
Yet U.S. Trade Representative
Mr. Lighthizer in particular
Robert Lighthizer’s demand to
doesn’t
want U.S. car makers
the rule of law is a
eliminate Nafta’s dispute-setto invest in Mexico. Yet those
government subsidy.
tlement panels, which protect
investments have kept the U.S.
the property rights and conindustry globally competitive,
tracts of North American invesresulting in thousands of new,
tors, would produce the opposite.
higher-paying jobs in the U.S. despite automaThe damage to Americans would be so serious tion. American oil-and-gas drillers also go where
that U.S. business groups are quietly threatening the resources are and that means investing
to oppose a renegotiated Nafta if Mr. Lighthizer across borders to explore and drill.
doesn’t back down. Last month Senate Finance
Sometimes investing locally is the only way
Chairman Orrin Hatch, House Ways and Means to do business locally. Railroads are literally on
Chairman Kevin Brady and more than 100 col- the ground. Finance companies train personnel
leagues warned in a letter that removing the “in- and develop brands by putting capital into marvestor-state dispute settlement” (ISDS) mecha- keting and sales. Telecom companies spend big
nism in Nafta “will jeopardize Republican to develop local market share. Walmart has
support, even among Members who consistently stores in Mexico to serve the growing middle
have voted for trade agreements.”
class. U.S. farmers invest abroad to get their exISDS agreements are common in modern ports to market.
trade pacts and bilateral investment treaties
American businesses know ISDS protection
because they provide foreigners recourse if do- levels the playing field with foreign competitors.
mestic courts discriminate against them. They Without it, the certainty that foreigners enjoy
also protect against capricious regulations that in U.S. courts isn’t reciprocal.
are disguised protectionism. The U.S. is party
As the Business Roundtable, National Associto 50 agreements world-wide that use ISDS. ation of Manufacturers and Chamber of ComSome critics say ISDS mechanisms encroach on merce explained in a letter to the AdministraU.S. sovereignty. But the U.S. government won tion in August, ISDS “upholds the same
all 11 cases it was involved in with Nafta arbi- fundamental due process and private property
tration panels.
guarantees protected by our Constitution, and
In October Mr. Lighthizer described ISDS as it obligates other countries to uphold these prea subsidy to business, “an advantage that’s out- cepts as well.” An example was Exxon’s use of
side the market.” Mr. Lighthizer seems to be ar- a bilateral investment treaty in 2004 to protect
guing that the free market is the law of the jun- its property rights after Argentina’s governgle and the rule of law is a government handout. ment seized its assets.
That’s strange from a trade lawyer who made his
The U.S. has championed the rule of law
career using U.S. courts to protect American around the world because it is good for human
steel from competition.
development—American and foreign. Trade or
Mr. Lighthizer also asked, “why is it a good investment treaties protect property rights so
policy of the United States government to en- investors have greater certainty and poor councourage investment in Mexico?” Mr. Lighthizer’s tries have more incentive to build institutions
goal is to raise the cost of investing outside the that lead to peace and prosperity. A Nafta reU.S. so Americans invest only at home. The more write without ISDS would be a major defeat for
political risk to U.S. companies abroad in his U.S. companies and the rule of law—and could
view, the better.
be defeated in Congress.
I was struck by the juxtaposition
of your two front-page articles on
April 2 (“Trump’s Loyalty to Coal Is
Tested” and “Worker Shortage Dogs
Midwest”) because it occurs to me
that we can kill two birds with one
stone: We can avoid use of scarce
government resources to prop up a
dying industry and satisfy the needs
of the manufacturers in Iowa if the
displaced coal workers were simply
willing to move and retrain. This is
especially feasible because the
change is from one blue-collar career
to another; we wouldn’t be asking
people to suddenly retrain as computer scientists.
Especially in a booming economy,
it is at least worth discussing
whether a combination of individual
unwillingness and lack of societal
support for striking out for new territory is more to blame for blue-collar unemployment than technology,
globalization and competing energy
sources.
PETER GRAF
Boulder, Colo.
up so as to bring more workers into
the job market. Witness the surge of
workers that came from Southern
states to Michigan to work in the automobile and defense industries in
the 1940s. That doesn’t mean, however, there isn’t a problem with the
labor market. In particular, the labor
market is beset with constraints in
the mobilization of workers to areas
of rekindled labor demand.
Imagine a labor market suffers a
severe downturn that lasts several
years. Seeing no local prospects,
workers rationally choose to move
out of the area. However, given the
downturn, local housing market conditions are such that houses cannot
be sold and those workers who
choose to move lose significant
wealth by selling their homes at depressed market prices. Now, several
years later, improved conditions in
the general economy provide an incentive to employers to revive their
shuttered assets and hire more workers. With this increase in the demand for labor, job openings and
wage offerings rise accordingly. FurHow ironic that at a time when the thermore, given the reduced size of
primary growth impediment affecting the labor pool, a true shortage might
many businesses across the Midwest
actually exist. However, unless these
is an acute labor shortage, our presi- employers provide some sort of tendent continues to justify many of his ure security, workers will be relucactions as necessary to stimulate the tant to migrate back into the area
economy and protect our southern
due to the prospect of again losing
border. The lack of workers won’t be wealth in the housing market with
remedied by President Trump’s curthe next economic downturn.
rent actions. Taking into account the
Thinking strategically, a smart enhistoric work ethic of desperate imtrepreneur might take the long view
migrants who have entered our coun- and offer home-buying assistance,
try, I expect that we would see many home-selling assistance and longpromptly employed here.
term contracts. These perquisites are
THOMAS G. LANGKAMMER typically offered to CEOs. What’s
Oshkosh, Wis. wrong with using these incentives
for other workers?
If there were a true shortage of
PROF. ROBERT H. BRUHL
University of Illinois at Chicago
workers, wage rates would be driven
Fed Should Do a Cost-Benefit Policy Analysis
Joseph C. Sternberg describes how
prolonged ultralow interest rate policies have caused serious problems for
defined-benefit pension plans in Britain (“Britain’s Monetary ‘Stimulus’ Has
Fed the Pension Crisis,” Political Economics, March 30). According to a recent study by the Bank of England,
such pension problems are now causing corporations to reduce their dividends and investment. Such a study
was overdue, but at least the British
central bank is willing to analyze one
of the many costs of ultralow rates.
In contrast, our Federal Reserve refuses to embark on any serious costbenefit analysis of its policies since
2008. It is quick to recognize how low
rates help debtors and how rising
stock prices have a positive wealth effect. But have you ever heard a Fed official give an estimate of the drop in
interest income to savers and pensioners, and how this decline affected consumption? How is punishing long-term
Give Digital Records to the
Patient, Not the ‘Provider’
Regarding the letters of March 27:
I suggest that those who are interested in electronic medical records
consider the use of the universal electronic health-record cards containing
a chip as used in France, a system developed by an American company.
The problem with using this simple,
intelligent system in the U.S. is that
many companies will each develop a
card and none will be able to communicate with the others. At one time a
hospital I worked in had five incompatible EHR systems. The ER’s
couldn’t communicate with the one
the wards used, so the ER records
had to be reduced to paper, sent to
the wards with the admitted patients,
and re-entered into the ward system.
FRITZ DIXON, M.D.
Meridian, Idaho
The Regulating of ‘Love’ Is
A Massive FDA Power Grab
Regarding Sheldon Bradshaw and
Marisa Maleck’s “The Twisted Case of
the ‘Deceptive’ Pretzels” (op-ed, April
2): The article underestimates the
value of the work provided by the Food
and Drug Administration. Despite the
regulation of the local, family-owned
Nashoba Brook Bakery in Concord by
almost 10 government agencies, it took
the FDA to sanction it for actively deceiving its customers into thinking that
“love” was an ingredient in its granola.
Fortunately, following the FDA’s warning letter, the practice ended. Now, we
only need to ensure that the love formerly in the granola mix isn’t a carcinogen. Perhaps an enterprising plaintiff’s lawyer will take up the case.
DEBORAH J. CLARKE
Sudbury, Mass.
Letters intended for publication should
be addressed to: The Editor, 1211 Avenue
of the Americas, New York, NY 10036,
or emailed to wsj.ltrs@wsj.com. Please
include your city and state. All letters
are subject to editing, and unpublished
letters can be neither acknowledged nor
returned.
saving a good policy?
Ultralow rates were necessary after
the crisis, but that doesn’t mean they
were needed for almost nine years. The
anemic growth of the economy before
2017 raises the question of whether ultralow rates are subject to diminishing
returns, or even negative returns at
some point. Failure to investigate that
question raises the risk of misguided
monetary policy in the future.
R.F. STAUFFER
Salem, Va.
King’s Legacy: Christian
Love and Responsibility
Regarding Jason L. Riley’s “Martin
Luther King: We Can’t Keep on
‘Blaming the White Man’” (Upward
Mobility, April 4): Progressives eventually devour honest liberals like
King who don’t conform to progressives’ constantly changing dogmas
(see Booker T. Washington). One day,
when progressives want to remove
all the Martin Luther King memorials—because he was a religionist
(worse yet, a Christian), or because
he dared to criticize protected
classes of victims, or because he was
accused of an impropriety—the last
group to defend him will be conservatives like Mr. Riley, who understand that a person’s character, not
gender, race, ethnicity or any other
factor, is what matters.
THOMAS M. DORAN
Plymouth, Mich.
King espoused colorblind equality
of opportunity and justice. He is
surely weeping in heaven at the antiwhite racism used for political gain
by many Democrats and their media
allies.
BILL MENZEL
Randolph, N.J.
Mr. Riley suggests that King’s successors have succeeded in demonstrating Eric Hoffer’s observation
that: “Every great cause begins as a
movement, becomes a business and
eventually degenerates into a
racket.”
LARRY W. WHITE
Dallas
Pepper ...
And Salt
THE WALL STREET JOURNAL
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THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | A15
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OPINION
By Bill Hammond
G
Albany, N.Y.
ov. Andrew Cuomo has a disturbing new way to raise revenue: using government muscle
to squeeze private organizations into
“voluntarily” writing billion-dollar
checks. That’s what he did to Fidelis
Care, a nonprofit health plan affiliated with the Catholic Church, and its
would-be buyer, Centene Corp.
In a murky deal announced on
Good Friday, Fidelis and Centene
agreed to pay the state $2 billion
over four years. The payments are
not technically required by law. But
Fidelis and Centene agreed to them
after a three-month pressure campaign by Mr. Cuomo, including overt
and implied threats to seize the
funds, block the sale or both.
Fidelis planned to devote
billions to health care
for the needy. New York’s
governor had other ideas.
Fidelis would seem an odd target
for a gubernatorial money grab.
Founded in 1993, it specializes in
health coverage for the poor. With 1.6
million members, it is the largest purveyor of state-sponsored programs
such as Medicaid managed care, Child
Health Plus and the Essential Plan, as
well as Medicare Advantage and commercial ObamaCare coverage. It has
played a big role in reducing the state’s
uninsured rate, and it has not been
publicly accused of wrongdoing.
What sparked Mr. Cuomo’s campaign was Fidelis’s pending sale to
Centene, announced in September, for
a price of $3.75 billion. The bishops
planned to put the money into a charitable foundation in support of health
care for the needy. Mr. Cuomo argued
that the state was entitled to $3 billion
of the proceeds because Fidelis earned
most of its revenue from state programs. By that logic, the state could
skim the savings accounts of public
employees when they retire.
He also cited the precedent of Empire Blue Cross Blue Shield, which
yielded billions to the state when it
converted to for-profit status in the
mid-2000s. But that was a unique
transaction under a narrowly tailored
law that applies to no other company.
Despite lacking a legal claim to the
money, Mr. Cuomo pursued it aggressively. Bills he submitted to the Legislature would not only have seized
80% of the proceeds from the sale but
also raided Fidelis’s reserve accounts
if the deal were canceled. The bishops
would have paid either way. The sale
needed regulatory approval from two
state agencies, the departments of
Health and of Financial Services, leaving it vulnerable to delay or rejection
by Mr. Cuomo’s appointees.
In the face of a three-way bind,
and with no meaningful support from
either party in the Legislature, Fidelis
and Centene agreed to give up $2 billion over four years, including $1.35
billion this year. The bishops’ charitable foundation is left with $3.2 billion, including both sale proceeds and
surplus cash, and Centene salvages
an expansion that has been well-received on Wall Street. But the state’s
end of the deal creates the ugly appearance that regulatory approval of
the Fidelis-Centene sale has been
bartered for a 10-figure sum.
A final disturbing twist is where
the state’s $2 billion is destined to go:
into a “health care transformation
fund,” into which the governor’s budget director can dip without even notifying the Legislature (or the public)
for 15 days. So Mr. Cuomo is diverting
money otherwise meant for charity to
furnish himself with $1.35 billion to
spend as he wishes in an election year.
What innocent but deep-pocketed organization will be next?
Mr. Hammond is director of health
policy at the Empire Center.
The GOP Needs a Free Facebook
By Chris Wilson
S
ocial media was a godsend
for Republican campaigns.
Online networks allow
conservatives to communicate to voters without
the filter of liberal media. A wellestablished narrative holds that
Democrats mastered social media
in Barack Obama’s presidential
campaigns. But an internal Facebook memo obtained by Bloomberg
News claims the GOP is using Facebook better than its Democratic
opponents.
As director of data and digital
strategy for Sen. Ted Cruz’s presidential campaign, I developed methods to send microtargeted messages
to voters on a variety of issues, using Facebook as a primary medium.
We spent time learning the site’s
rules, we played by them, and it
worked.
In Iowa we used data-driven digital advertising to help propel Mr.
Cruz to victory. We went through the
media filter for TV and radio ads,
but we also bypassed it, taking our
message directly to voters online.
It is much harder for congressional campaigns to generate media
coverage, and harder still to persuade reporters and editors of the
merits of conservative positions.
But congressional Republicans are
considering new regulations on the
social-media sites that allow them
to reach voters. They should be
careful what they wish for.
If Hillary Clinton had won the
election as well as the media’s coronation, would we even be debating a new regulatory scheme for
social-media advertising, and would
Facebook chief Mark Zuckerberg be
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appearing before Congress this
week to be grilled about his company’s role in the 2016 election?
We know the answer. Regulation is
considered only when Republicans
Regulation would turn
the social-media giant
into just another media
filter—with the usual bias.
become innovative enough to surpass Democrats in digital campaigning.
Some legitimate concerns have
been raised about foreign-intelligence services using social media
to spread “fake news,” but liberals
have largely overstated the effects
of those efforts. Hillary Clinton’s
failure to visit Wisconsin, and her
description of millions of voters as
“deplorables,” contributed far more
to her losses in key states than did
Russian clickbait.
One sensible safeguard for socialmedia advertising would be greater
disclosure in political ads. Facebook
is on the right track with voluntary
measures to verify the legitimacy of
political advertisers and to require
disclaimers on such ads.
But conservatives and Republicans should fiercely resist any attempt to make social-media platforms arbiters of truth in digital
advertising. Such a move would
transform the free advertising
market into a highly regulated monopoly, in which the liberal media
filter would disadvantage conservative candidates online it has for
decades on television and in print.
Giant tech companies like Facebook can not only survive but also
thrive under regulation. They can
afford the cost of compliance, hiring tens of thousands of employees dedicated to ad verification.
Smaller competitors would stand
no chance of keeping up. This is
how government regulation cements market share and creates
monopolies.
Why should conservatives worry
about this? Look at the newspaper
industry as an example. Across
America, two-paper towns once
benefited from healthy competition
between newsrooms. Then they became one-paper towns. When news
monopolies became the reality
from Minneapolis to Houston, the
news slanted further left. The
Houston Chronicle, after vanquishing the Houston Post in 1995,
lurched left editorially. Consumers
in America’s most populous purple
county had nowhere else to go for
local news.
A similar dynamic would likely
play out if Congress imposed regulations on Facebook and its competitors. A tool once used successfully by conservative campaigns
would see its market share frozen
in place, and in the absence of
competition it would become like
all media before it, free to express
political bias.
Tread carefully, my Republican
friends, lest you transform the tool
that bypasses the media filter into
another media filter, with all the
inherent biases.
Mr. Wilson is CEO of WPA Intelligence, a Republican data-science
firm.
Clinton Supporters Have Some Questions for Comey
By Lanny J. Davis
J
ames Comey’s book comes out
next week. While promoting “A
Higher Loyalty: Truth, Lies, and
Leadership” the former director of
the Federal Bureau of Investigation
should face some tough questions.
First, will he correct the postelection distortions by “friends and associates” meant to justify his decision to send the Oct. 28, 2016, letter
to Congress? That letter—which announced the FBI was reopening its
investigation into Hillary Clinton’s
emails—almost certainly handed
Donald Trump the presidency.
In an Oct. 29, 2016, internal
memo, Mr. Comey claimed he was
“obligated” to inform Congress because of a public commitment he
had made during a congressional
hearing. But that is untrue. On Sept.
28, 2016, Rep. Lamar Smith (R.,
Texas) had asked what the FBI chief
would do if anything new on the
Clinton emails issue was discovered.
Mr. Comey responded only that “we
would certainly look at any new and
substantial information.”
The FBI began reviewing emails
found on former Rep. Anthony Weiner’s laptop on Oct. 31, 2016, some
four weeks after Mr. Comey was
made aware of their existence.
Agents completed their work on Nov.
5. Since it took less than a week to
review the emails, couldn’t Mr.
Comey have done so before informing
Congress? If Mr. Comey argues he
didn’t know how long it would take,
the question remains: Why didn’t he
look first? This is especially important given the undeserved political
damage caused by the letter.
Mr. Comey also falsely claimed
that the FBI needed to obtain a warrant before reviewing the Clinton
emails on Mr. Weiner’s laptop. In
fact, attorneys for Huma Abedin and
Mr. Weiner told the New Yorker’s
Peter Elkind that they would have
“readily acceded” to FBI requests to
review the Clinton emails without a
warrant. But Mr. Comey and the FBI
never asked. Why?
Then there is the still-unexplained delay between Mr. Comey’s
being told about the Weiner-Clinton
emails and obtaining a warrant. On
Oct. 3, 2016, Mr. Comey first learned
about the discovery of the new
emails. Yet it wasn’t until Oct. 30
that he and the FBI obtained a warrant to look at them. Many conservatives believe Mr. Comey and Deputy Director Andrew McCabe
deliberately delayed the review to
help Mrs. Clinton, but the opposite
is the case.
Had Messrs. Comey and McCabe
immediately begun the search after
finding the emails Oct. 3, the FBI
would have completed its review
within days. By Oct. 10, the headlines would have been that Mrs.
Clinton had been “cleared,” again, of
legal wrongdoing regarding her
emails. She could have spent the last
Why did the FBI wait
almost four weeks before
examining the emails on
Anthony Weiner’s laptop?
four weeks of her presidential campaign focused on positive messages.
Instead, the crucial closing days of
the campaign were about her
emails—and her polling numbers
plummeted in key battleground
states.
Worst of all is Mr. Comey’s selfserving distortion that once the
emails were discovered on Mr. Weiner’s laptop, he had only two choices:
to speak or to conceal. There was a
third choice. As Deputy Attorney
General Rod Rosenstein wrote in his
May 10, 2017, memorandum to President Trump, Mr. Comey could have
remained silent, as required by longstanding Justice Department policies
and due-process principles.
Mr. Rosenstein wrote: “Concerning his letter to the Congress on October 28, 2016, the Director cast his
decision as a choice between
whether he would ‘speak’ about the
decision to investigate the newlydiscovered email messages or ‘conceal’ it. ‘Conceal’ is a loaded term
that misstates the issue. When federal agents and prosecutors quietly
open a criminal investigation, we
are not concealing anything; we are
simply following the longstanding
policy that we refrain from publicizing nonpublic information.” Mr.
Rosenstein concluded: “Silence is
not concealment.”
The irony of Mr. Comey’s book title—“A Higher Loyalty”—should be
obvious. While he deserves respect
for resisting President Trump’s demand for personal loyalty, the FBI
director’s true higher loyalty is to
his self-righteous definition of what
is best for himself and the FBI—the
rules applicable to the rest of us be
damned.
Mr. Davis, who served as a special counsel to President Bill Clinton, is a columnist for the Hill
newspaper and author of “The Unmaking of the President 2016: How
FBI Director James Comey Cost Hillary Clinton the Presidency” (Scribner, 2018).
A Former President Goes to Prison
By Diogo Costa And Magno Karl
B
razil’s former President Luiz
Inácio Lula da Silva is officially a prisoner of the state.
On Saturday Mr. da Silva turned
himself over to the police to begin
serving his 12-year sentence for corruption and money laundering. An
emotional and tumultuous affair,
Lula’s imprisonment is nonetheless
a necessary step to restore public
trust in Brazil’s institutions.
Still, the road ahead will not be
easy. Mr. da Silva’s political party,
the Workers’ Party (known as the
PT), will try to turn his story into a
tale of political prosecution. But
the trial fully complied with Brazilian law. As long as Brazil’s judicial
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institutions remain firm, the country’s ruling elite will take to heart
the real lesson: that no one is
above the law—not even powerful
and rich men with loud, influential
supporters.
Mr. da Silva had asked Brazil’s
Supreme Court to allow him to remain free while appeals in his case
were pending. The justices held last
week, however, that defendants can
be jailed so long as one appeals
court has already upheld the conviction. Had the Supreme Court
ruled for Lula, many corrupt officials all across the political spectrum could have escaped prison on
countless technical appeals. That
remains the strategy for sitting
politicians, who have foro privilegiado, the right to be tried only by
higher courts, where justice is
slower and more political. Because
the courts are overloaded with
cases that they do not have time to
process, this privilege often
amounts to de facto immunity from
conviction.
To continue enjoying foro privilegiado, public officials will need to
win re-election in Brazil’s national
elections this October. With corporate political donations now
banned, politicians have argued
they need public funds to campaign.
Last year lawmakers set up a campaign fund with about $540 million
of tax money, which will be allocated according to parliamentary
representation.
But the result is tax money going
to support the very political parties
embroiled in the Operation Car Wash
corruption scandal. That investigation
uncovered a massive web of bribes
and kickbacks among politicians and
private parties. Depositions from the
construction giant Odebrecht alone
mention 415 politicians from 26 parties. In four years, it has led to 188
convictions against 123 individuals,
totaling 1,861 years in jail.
At the center of the scandal are
government-controlled corporations
that went through a period of rapid
Only 6% of Brazilians trust
the government. Lula’s
conviction for corruption
may change that.
growth under Mr. da Silva’s presidency. In 2007, the oil giant Petrobras embarked on an enormous capital expenditure program, with state
banks responsible for much of the
company’s debt. One of those state
banks, BNDES, disbursed about $380
billion from 2003 to 2010, Lula’s
eight years in power. That’s more
than twice what the International
Monetary Fund disbursed over the
same period.
In exchange for contracts, subsidies and other benefits, well-connected companies illegally channeled resources to Brazil’s political
parties. Investigators have unearthed about $1.9 billion in bribes
and kickbacks. The ruling coalition
around Mr. da Silva’s PT got a big
share of the action. Federal prosecutors called Lula the “commander in
chief” of the corruption scandal.
They estimated that he had received
up to about $67 million in gifts and
illegal donations.
Since Operation Car Wash began
to expose the inner workings of Brazil’s corruption machine, trust in
public institutions has severely deteriorated. An annual survey shows
that only 6% of Brazilians trust the
federal government, followed by 7%
each for the National Congress and
political parties. The most trusted
institution in Brazil, with a 56% rating, is the military.
Brazil’s democracy can regain the
public’s confidence and make further
strides in the fight against corruption, but the country’s institutions
must change. Campaign-finance legislation should be a priority. The
next government should pass a law
to prevent lawyers from launching
endless appeals that keep powerful
clients out of jail. Effective immunity foro privilegiado should be
abolished, or at least strictly limited
to specific situations. Political parties should be held accountable for
misconduct, and any that turn into
criminal organizations should be
dissolved.
Such bold reforms will not come
from today’s politicians. But as
Lula’s conviction indicates, Brazilians are willing to bring their most
popular leaders to justice. The Operation Car Wash investigation is doing its part. Soon it will be time for
voters to do theirs. With elections
coming up in October, the case for
political renovation in Brasília is
stronger than ever.
Mr. Costa is public policy coordinator for Brazil’s Novo Party and a
doctoral candidate at King’s College
London. Mr. Karl is a political consultant and a doctoral candidate at
the Willy Brandt School of Public
Policy.
.
A16 | Tuesday, April 10, 2018
* ****
THE WALL STREET JOURNAL.
WORLD NEWS
Hungary Premier’s Win Lifts Clout in EU
Landslide victory puts
Orban in position to
advance laws against
migrant movement
Sealed Mandate
Viktor Orban’s party won a
two-thirds majority in Hungary’s
parliament, expanding his broad
authority over the nation.
Seats won per party:
BY DREW HINSHAW
AND ANITA KOMUVES
Jobbik
(nationalist) 25
MSZP
(socialist) 20
The Democratic
Coalition
(socially liberal) 9
Politics Can
Be Different
(centrist) 8
other parties 3
Source: Hungarian National Election
Commission
THE WALL STREET JOURNAL.
BERNADETT SZABO/REUTERS
BUDAPEST—A
landslide
victory has left Hungary’s nationalist Prime Minister Viktor
Orban in a position to cement
both his authority at home
and his influence in the European Union, potentially shifting the Continent’s balance of
power further to the right,
even as international observers declared the vote unfair.
Mr. Orban’s Fidesz party
won 134 of the legislature’s
199 seats in Sunday’s election,
ensuring it has the number of
votes to pass major overhauls
and constitutional changes
unilaterally. Hungarian political analysts and Fidesz officials said they widely expected
their now four-term prime
minister to do both.
Hours after the election, a
Fidesz spokesman said the
party within weeks would pass
a law imposing a 25% tax on
aid groups that assist migrants—the so-called Stop Soros Law, aimed at Hungarianborn billionaire George Soros, a
liberal donor to nongovernmental institutions. A spokesman
for Mr. Orban said the prime
minister would tighten restrictions preventing NGOs from
getting involved in politics.
The results were felt in the
EU, which was as much Mr.
Orban’s opponent on the campaign trail as any of the minor
parties he prevailed over. For
three years, Mr. Orban has
castigated the bloc and its
2015 plan to resettle 1,294 ref-
Fidesz
(nationalist) 134
Hungarian Prime Minister Viktor Orban addressed supporters in Budapest on Sunday, when he won re-election by a wide margin.
ugees from Greece and Italy in
Hungary, comparing it to the
Soviet Union, which once
dominated the country.
Mr. Orban’s victory underscored just how fully the issue
of immigration has remade Europe’s political order. In Italy,
Poland, the Netherlands, France
and elsewhere, technocratic
center-left parties that were
once the chief governing force
on the Continent have seen
steep declines, unable to answer
voter anxieties on migration.
In the nearby Czech Republic, the 140-year-old Social
Democratic Party fared so
poorly in last year’s border-focused election that the once
formidable center-left faction
now holds fewer seats in Parliament than the Pirate Party,
a youth-powered direct-democracy movement.
In Hungary, no major politician disagrees with Mr. Orban’s refusal to settle refugees
or migrants here—and several
think he hasn’t been tough
enough on Hungary’s border.
Even still, Mr. Orban ran his
campaign almost exclusively
on immigrants, telling voters
that millions of Africans and
Middle Easterners could cross
into the country if he lost.
“They want us to voluntarily hand our country over
to others,” he said at a rally in
March. “Europe is now under
invasion.”
While Mr. Orban’s opponents ran on issues like corruption or health care, he
hammered away at the issue.
“Any party would be crazy
to give up a political tool that
is so valuable and effective,”
said Gábor Török, a political
scientist at the Corvinus University of Budapest.
There were hardly any bright
spots for the fractured opposi-
tion, except for a statement by
an international observer group
that effectively agreed with
them that elections in Mr. Orban’s country have become unfair. The prime minister’s party
mixed state funds into its own
coffers to run its campaign,
said observers from Vienna’s
Organization for Security and
Cooperation in Europe.
The country’s major TV
outlets, virtually all of which
are owned by Mr. Orban’s government or his allies, covered
the prime minister “in almost
exclusively positive terms,”
the observers said. Mr. Or-
ban’s government rewarded
them with by buying advertising, they added. Its rules on
how voters abroad could cast
ballots were different for different categories of voters—
seemingly along partisan lines,
the observers said.
On Tuesday, European
Commission President JeanClaude Juncker was set to
hold talks with Mr. Orban. EU
officials are looking at ways
to link aid to countries that
respect the rule of law, a proposal understood to target
Poland and Hungary.
But Mr. Orban has powerful
supporters within Mr. Juncker’s
own European People’s Party,
an umbrella organization of
center-right parties including
German Chancellor Angela
Merkel’s Christian Democrats.
—Valentina Pop in Brussels
contributed to this article.
Pope Puts Social Causes at Forefront North Korea Leader
ROME—Pope Francis criticized Christians who emphasize opposition to abortion
above social causes such as
poverty and migration, in his
latest effort to readjust the
priorities of Catholic moral
teaching from what he has
characterized as an overemphasis on sexual and medical
ethics.
“Our defense of the innocent unborn needs to be clear,
firm and passionate,” the pope
wrote in a document released
by the Vatican on Monday.
“Equally sacred, however, are
the lives of the poor, those already born,” including the neglected elderly and victims of
human trafficking.
The pope’s words appeared
in “Gaudete et Exsultate”
(“Rejoice and Be Glad”), a reflection on “holiness in today’s
world” that includes advice on
resisting the “verbal violence”
of social media and achieving
spiritual concentration amid a
“culture of zapping.”
The document is known
technically as an apostolic exhortation, one of the more authoritative forms of papal
writing below the level of an
encyclical. Pope Francis didn’t
MASSIMO VALICCHIA/NURPHOTO/ZUMA PRESS
BY FRANCIS X. ROCCA
Pope Francis leaving St. Peter’s Square after Mass on Sunday.
invoke papal infallibility in the
document, but Catholics are
generally expected to regard
papal teaching at this level
with reverence and “submission of mind and will.”
Pope Francis has repeatedly
called for reducing the emphasis on certain moral issues and
increasing attention to social
and economic justice.
That approach stands in
contrast to that of his predecessor, Pope Benedict XVI,
who specified opposition to
abortion, euthanasia and
same-sex marriage among a
handful of “nonnegotiable”
values for the church.
In terms of ethical priorities, Pope Francis wrote in the
document released Monday
that an exclusive focus on
abortion reflects a “harmful
ideological error” of those who
play down the importance of
social action or denigrate it as
“superficial, worldly, materialist, communist or populist.”
“We cannot uphold an ideal
Affirms U.S. Talks
of holiness that would ignore
injustice” in the form of economic inequality, the pope
added.
The pope also criticized
what he characterized as an
exaggerated focus on moral
relativism, a concept closely
associated with the teaching
of Pope Benedict, who famously denounced what he
called a “dictatorship of relativism” in contemporary culture.
“We often hear it said that,
with respect to relativism and
the flaws of our present world,
the situation of migrants, for
example, is a lesser issue.
Some Catholics consider it a
secondary issue compared to
the ‘grave’ bioethical questions. That a politician looking
for votes might say such a
thing is understandable, but
not a Christian,” Pope Francis
wrote.
He also warned against the
danger of seeking social
change while neglecting personal piety through prayer and
Bible reading.
“Christianity thus becomes
a sort of NGO stripped of the
luminous mysticism” exemplified by St. Francis of Assisi
and Mother Teresa of Kolkata,
the pope wrote.
BY JONATHAN CHENG
SEOUL—North
Korean
leader Kim Jong Un publicly
acknowledged for the first
time the prospect of a “dialogue” with the U.S. and a
planned summit meeting with
South Korea’s president,
breaking a weekslong silence
that had raised questions
about Pyongyang’s participation in the high-level meetings.
Mr. Kim, speaking at a
meeting of the Politburo of the
Workers’ Party of Korea on
Monday, “made a profound
analysis and appraisal of the
orientation of the development
of the north-south relations at
present and the prospect of
the DPRK-U.S. dialogue,” according to a state media report published Tuesday.
Mr. Kim’s remarks were
published just hours after
President Donald Trump said
at a cabinet meeting Monday
that a summit with Mr. Kim
could take place “in May, or
early June,” extending a timeline that the White House had
first made public last month.
Mr. Kim’s acknowledgment
Fossil Finger Bone Points to History of Human Migration
A fossil finger found among
stone tools in the Arabian
sands offers new clues to how
humankind emerged from Africa, an international team of
archaeologists said Monday.
The single finger bone—
the first ancient human fossil
discovered in Saudi Arabia—
is the oldest reliable evidence
of early humans outside Africa and the Levant, an area
along the Mediterranean that
includes Israel. It belongs to
an era more than 85,000
years ago when the Nefud
Desert, where archaeologists
made the find, was a lake surrounded by grasslands, said
the scientists who published
their find in the journal Nature Ecology & Evolution.
The new find offers evidence that anatomically modern humankind not only left
Africa earlier than previously
believed, but also wandered
far afield across the Arabian
Peninsula, the scientists said.
In fact, our most direct early
ancestors may have moved out
of Africa not once, but many
times as regional climate conditions wavered between ex-
IAN CARTWRIGHT/MICHAEL PETRAGLIA/ASSOCIATED PRESS
BY ROBERT LEE HOTZ
Views of a Homo sapiens fossil finger bone from the Al Wusta archaeological site in Saudi Arabia.
tremes of aridity and humidity.
“It has major implications
with respect to how our species came out of Africa and
the routes they took,” said ar-
chaeologist Michael Petraglia
at the Max Planck Institute for
the Science of Human History
in Jena, Germany, who was the
senior author of the study. “It
shows us that modern humans
were moving across the interior, not just along the coastlines.”
Until recently, many scholars of human evolution,
largely guided by genetic evi-
dence, believed that anatomically modern Homo sapiens
migrated into Europe and Asia
around 60,000 years ago. In
this scenario, these hunters
and foragers traveled northward along a narrow strip of
the Mediterranean coastline,
where they could shelter in
the thick woodlands that once
covered the region.
A flurry of fossil discoveries in northern Israel, Laos,
Sumatra, Australia and China
now suggest that relatively
modern humans may have
reached those regions thousands of years earlier. The new
discovery in Arabia, an area
long overlooked by archaeologists, is certain to add more
fuel to arguments over when
and where humankind began
its global journey.
To confirm the bone belonged to Homo sapiens, scientists compared its distinctive long and slender shape to
finger bones from other humans, extinct early human
species such as the Neanderthals, and to nonhuman primates. They calculated its age
by directly testing the bone
using a technique called uranium series dating.
of the high-level meetings came
after a lengthy silence that had
led some experts to wonder
about North Korea’s willingness
to meet Mr. Trump and South
Korean President Moon Jae-in.
Word of Pyongyang’s apparent agreement on the summits
had initially come from South
Korean envoys who had met
with Mr. Kim, and not directly
from North Korea, which for
several weeks made no mention of the meetings.
The Wall Street Journal reported on Sunday that Pyongyang had made direct assurances to Washington that the
issue of its nuclear arsenal
would be up for discussion at
a possible U.S.-North Korea
summit—fulfilling a key demand of the White House.
“There will be great respect
paid by both parties and hopefully there will be a deal on
de-nuking,” Mr. Trump said on
Monday. “Hopefully it will be a
relationship that will be much
different than it has been for
many, many years.”
—Michael Bender
in Washington
contributed to this article.
WORLD WATCH
COLOMBIA
Top FARC Leader
Faces Drug Charges
Police arrested a top leader
of the FARC, the guerrilla group
turned political party, on charges
of conspiring to smuggle 10 tons
of cocaine to the U.S. in violation
of a peace pact that paved the
way for the group’s disarmament, Colombia’s government
announced.
Moving on a federal grand
jury indictment handed up in
New York, Colombian police on
Monday raided the home of
Seuxis Hernández, 51 years old,
arresting him and three associates.
—Juan Forero, Kejal Vyas
JAPAN
Central Banker Warns
Of Trade-War Fallout
Bank of Japan Gov. Haruhiko
Kuroda opened his new five-year
term with a warning about the
impact of a U.S.-China trade fight.
.Mr. Kuroda said a protectionist approach could backfire on a
country by limiting imports it
needs.
—Megumi Fujikawa
.
TECHNOLOGY: APPLE GOES ALL GREEN B6
BUSINESS & FINANCE
© 2018 Dow Jones & Company. All Rights Reserved.
S&P 2613.16 À 0.33%
S&P FIN À 0.51%
* * * **
S&P IT À 0.78%
THE WALL STREET JOURNAL.
DJ TRANS g 0.27%
WSJ $ IDX g 0.18%
Tuesday, April 10, 2018 | B1
NIKKEI (Midday) 21913.06 À 1.08%
LIBOR 3M 2.337
See more at WSJMarkets.com
Facebook’s Ills Pose Regulatory Puzzle
In prepared remarks,
Zuckerberg says not
enough was done to
protect user data
BY JOHN D. MCKINNON
AND KEACH HAGEY
Mark Zuckerberg said in
prepared congressional testimony Monday that misuses of
personal data on Facebook
have made it clear the social
network didn’t do enough to
prevent its tools “from being
Russian
Markets
Recoil on
Sanctions
used for harm.”
The chief executive also
promised action to prevent future abuses, even at the expense of profits.
His remarks made in response to recent revelations
about the company’s handling
of subscribers’ information set
the scene for his appearance
this week on Capitol Hill,
which is likely to prompt a raft
of questions over how the government should regulate social-media platforms if their
own measures fall short.
So, what might such regula-
tion look like?
The question has grown urgent after Facebook acknowledged that political consulting
firm Cambridge Analytica improperly accessed the private
data of some 87 million users.
In response, Congress, the Federal Trade Commission and
even state attorneys general
are deliberating regulatory options, as Washington senses
growing public discontent with
the status quo.
Coming up with smart, effective rules to govern the
huge businesses of Facebook
and its rivals, from Google to
Twitter, would be challenging,
and sound legislation could
take months, if not years, to
execute.
The goal would be to protect user privacy, increase
transparency and give individuals greater control over their
digital identities, while not stifling innovation in an industry
that is the epitome of American ingenuity and entrepreneurship. What follows are
options—and challenges—for
those positioned to create the
rules of the road.
Pass privacy laws: Congressional action to introduce
new laws to protect the data of
individuals would be the single
most powerful step Washington could take. Other countries
have taken such an approach,
which involved delineating
how companies can collect,
share and utilize user data. But
passing such legislation could
be a heavy lift. Rep. Marsha
Blackburn (R., Tenn.), an influential subcommittee chairman,
introduced such a bill last year,
but tech lobbyists beat back
her effort.
Alibaba Trains Its Gaze on Facial Recognition
THOMAS PETER/REUTERS
BY MAUREEN FARRELL
AND JULIE WERNAU
INVESTMENT WATCH: A funding round led by the e-commerce firm values surveillance startup SenseTime at over $4.5 billion. B6
PayPal Shifts to Traditional Banking
BY PETER RUDEGEAIR
PayPal Holdings Inc. is
nudging its customers closer
to mainstream banking services.
The San Jose, Calif.-based
payments company has been
reaching out to groups of customers in recent months with
an offer to add basic banking
features to their PayPal digital
wallet. The features include
Federal Deposit Insurance
Corp. insurance for balances
up to government-set limits, a
debit card that can be used to
withdraw cash at ATMs and
the ability to add funds to accounts by taking a photo of a
check or by having employers
deposit paychecks directly into
an account.
PayPal users already served
by traditional banks may not
be tempted to ditch their existing checking accounts. The
company isn’t paying interest
STREETWISE | By James Mackintosh
Trade Threats Are Real
But Risk Hard to Gauge
Sometimes
it is worth
asking stupid
questions.
Here is one:
Why should
we care about President
Donald Trump’s threatened
25% tariffs on $150 billion in
trade with China?
“Duh, tariffs are bad,”
would be the response from
anyone convinced of the benefits of trade—and that is almost everyone who has studied economics—as well as
anyone who has read anything about the Great Depression.
Yet the actual direct impacts of the tariffs are easily
manageable, both for the
U.S. and China, because $150
billion just isn’t that much.
Even including earlier tariffs
Full article on CEO’s
testimony...................................B4
Facebook to back studies on
elections......................................B4
Employees unfazed by crisis
at company................................B4
IPO Puts
Saudi
Exchange
On Map
BY JAMES MARSON
AND SCOTT PATTERSON
MOSCOW—Russian markets
convulsed in the wake of new
U.S. sanctions, as the ruble slid
and domestic and foreign investors dumped Russian stocks.
Shares in United Co. Rusal
PLC, the giant Russian aluminum maker, lost half of their
value on Monday, after the
U.S. hit the company and its
main owner, Oleg Deripaska,
with sanctions on Friday.
The damage spread across a
broad range of Russian assets,
leaving the country’s main
Micex stock index down more
than 8% and the ruble off 4%
against the U.S. dollar.
“Now, no one in the top 100
list [of wealthiest Russians]
can be sure they won’t be subject to sanctions,” said Timothy Ash, an analyst at BlueBay
Asset Management in London.
Russian Prime Minister
Dmitry Medvedev on Monday
ordered ministers at a government meeting to work out
measures to support companies that have been targeted
by sanctions, without giving
details.
The measures could hit
Russian economic growth, already forecast to be weak this
year, as banks will be even
more cautious about lending
to Russian companies, Mr. Ash
said. However, analysts from
Renaissance Capital said the
impact on growth should be
limited by the fact that many
companies have reduced external debt in recent years.
Many investors were surprised by the severity of the
sanctions, which targeted senior
Russian government officials as
well as some of President Vladimir Putin’s closest business allies and their companies.
Hardest hit Monday was
Rusal. Its shares finished
down 50% in Hong Kong, its
main listing, after it said in a
filing Monday that U.S. sanctions “may result in technical
Please see RUSSIA page B2
Repeal immunities: Facebook, Google and other tech
giants generally can’t be held
legally responsible for the bad
behavior of those who use
their platforms, thanks to laws
enacted when the internet was
first blossoming in the 1990s.
But lawmakers recently voted
Please see TECH page B4
on solar panels, washing machines, steel and aluminum,
this year’s tariffs will apply
to less than 7% of U.S. imports. On top of that, the
U.S. isn’t nearly as reliant on
trade as many smaller, more
open economies.
Stock markets haven’t
taken the tit-for-tat tariff announcements well, but aren’t
down all that much. So what
is the problem?
There are two big threats,
and one unquantifiable risk.
First, that the tariffs confirm
Mr. Trump’s longstanding
protectionist instincts, and
so are just the start of a descent into a global trade war
big enough to trash the
economy. Second, that the
tariffs spook markets, which
are still assuming that the
Please see STREET page B2
on balances and is charging a
fee of 1% on any check a customer deposits via a photo, in
addition to fees for taking
money from ATMs other than
the 25,000 inside PayPal’s network, said Bill Ready, PayPal’s
chief operating officer.
But it could be a better option for certain consumers
with smaller balances who are
largely ignored by banks and
have to rely on check-cashing
centers and other alternative
providers of financial services.
PayPal isn’t charging a
monthly fee and isn’t requiring customers to keep a minimum balance.
Mr. Ready said the company’s goal was to give those
excluded from the banking
system access to the digital
economy. “If you don’t have a
bank account, you can’t take
an Uber ride, can’t stay in a
room on Airbnb,” Mr. Ready
said.
INSIDE
STOCKS RIDE
ROLLER
COASTER
MARKETS, B13
BEZOS GIVES
TRUMP SILENT
TREATMENT
TECHNOLOGY, B5
Paying Up
Active customer accounts
at PayPal, globally
250 million
200
150
100
50
0
3Q 4Q
2016
1Q 2Q
2017
3Q
4Q
Source: the company
THE WALL STREET JOURNAL.
A number of other technology firms with large user
bases are looking at providing
banking functions. Square Inc.
gives out bank cards to users
of its Cash App who want one,
and Amazon.com Inc. has
been in discussions to build a
checking-account-like product.
There is a catch: PayPal and
other tech firms don’t have a
U.S. banking license. The FDIC
doesn’t backstop funds stored
at nonbanks, and Visa Inc. and
Mastercard Inc. only permit
cards that run on their network to be issued by banks.
In PayPal’s case, the company turned to a hodgepodge
of small banks. It cut deals
with a Delaware bank to issue
debit cards, a Georgia bank to
deposit checks instantly after
users take a photo of them,
and banks in Utah to make
loans to consumers and small
businesses.
Mr. Ready said that working with several different
banks allows PayPal to get
products to consumers faster
and that the company has no
intention of becoming a bank.
Saudi Arabia’s meager stock
exchange hosts around 191
companies whose value totals
roughly $500 billion, or a little
more than half the value of
Apple Inc. With one more very
important listing, it could balloon in size—or be overwhelmed.
So far, Saudi Arabia’s
Tadawul is the only confirmed
listing exchange for Saudi
Arabian Oil Co., the giant
company better known as
Aramco, which the kingdom
estimates could be worth $2
trillion. While the world’s
leading stock exchanges and
governments have been busy
lobbying Saudi Crown Prince
Mohammed bin Salman to be
able to list Aramco, the
Tadawul has been scrambling
to ready itself.
Seeking to prove it can successfully list and trade the
stock of a company whose initial public offering would be
the biggest ever, the Tadawul
and its regulators have worked
on a rapid-fire series of
changes designed to bring its
technology in line with international standards and to
court more overseas investors.
“It’s not often that you get
to be the exchange and the
market that hosts the largest
IPO in history,” said Mohammed El Kuwaiz, chairman of
the Capital Market Authority,
the regulator for Saudi markets, in January. “We’re looking forward to Aramco to put
us on the map.”
Last month, Saudi Arabia
got a nod it is heading in the
right direction, receiving approval to join the benchmark
FTSE Emerging Markets index,
a step expected to push billions in new international capital onto the Tadawul as
money managers and passive
investors who track those indexes invest accordingly.
Please see IPO page B2
Deutsche Girds for Hardship
BY JENNY STRASBURG
Christian Sewing, a career
Deutsche Bank AG employee
little known outside Germany,
learned with near-certainty
Friday night that he should
prepare to take the global
stage running the country’s
biggest lender.
Now that he has been appointed chief executive, his
role is clear: to make Deutsche
Bank safer and more profitable, in part by shrinking it.
That task has proved
fraught with difficulty even
for past incumbents who had
decades of investment-banking
experience. Investment banking and trading, Deutsche
Bank’s biggest sources of
profit, are struggling lately.
Mr. Sewing has never
worked directly as an investment banker or trader, though
he has overseen risk controls
and auditing for both businesses in senior roles spanning his 27-year Deutsche
Lagging Behind
Share-price and index performance
125%
JPMorgan
Chase
100
75
S&P 500
50
25
Goldman
Sachs
0
–25
Euro Stoxx
Banks
Credit
Suisse
Deutsche
Bank
–50
–75
–100
’07 ’08 ’09 ’10 ’11
’12
’13
Source: FactSet
Bank career. Since 2015 he has
been the senior executive
overseeing retail, private and
commercial banking out of the
Frankfurt-based
lender’s
hometown towers.
’14 ’15
’16 ’17
’18
THE WALL STREET JOURNAL.
The 47-year-old German
over the past year has been
Please see BANK page B12
Heard: Deutsche CEO has a
tough task ahead. ............... B14
.
B2 | Tuesday, April 10, 2018
* *****
INDEX TO BUSINESSES
THE WALL STREET JOURNAL.
BUSINESS & FINANCE
These indexes cite notable references to most parent companies and businesspeople
in today’s edition. Articles on regional page inserts aren’t cited in these indexes.
A
F
Novartis.....................B14
Airbnb..........................B1
Facebook ..... A2,B1,B4,B5
Novartis.......................B7
Alibaba Group........B6,B7
FirstEnergy..................B2
NRG Energy.................B2
Allegheny Energy........B2
G
P
Altice.........................B12
GlaxoSmithKline.........B7
PayPal..........................B1
Amazon.com.....B1,B5,B7
Glencore ...................... B2
PJM Interconnection...B2
AMC Entertainment
Holdings....................A8
H
R
Honda Motor...............B6
Regal Entertainment
Group ........................ A8
Ant Financial Services
Group...................B6,B7
Apple......................B1,B6
AT&T.......................B3,B5
AveXis..................B7,B14
I
Impala Platinum
Holdings....................A7
Ionis Pharmaceuticals B7
Studio Movie Grill......A8
B&B Theatres ............. A8
K
Sulzer..........................B2
Boeing ....................... B14
Karo Mining Holdings A7
Suning.com..................B6
C
L
T
Caledonia Mining........A7
Lazada Group..............B7
Temasek Holdings ...... B6
Caterpillar ................. B14
Leucadia National.....B12
Time Warner...............B3
Cineworld Group.........A8
Liberation Mining.......A7
U
Commerzbank ........... B14
Li & Fung.....................B7
Uber Technologies ...... B6
D
M-N
United Rusal...............B1
Dalian Wanda Group..A8
Marfrig Global FoodsB12
V
Deutsche Bank .... B1,B14
Mastercard..................B1
E
Merck.........................B13
EN Group.....................B2
Square.........................B1
Visa..............................B1
Z
Monsanto.............A1,B13
Netflix.........................A8
FirstEnergy Corp. is waging a lonely fight as it seeks to
persuade the Trump administration to bail out its struggling coal and nuclear-power
plants through an unprecedented emergency action that
experts say would effectively
end America’s largest competitive electricity market.
The Ohio-based utility doubled down on coal and nuclear
power in 2010 when it struck
a deal to purchase Allegheny
Energy Inc. for $8.5 billion,
just as fracking in the nearby
Marcellus Shale formation
started to unleash cheap natural gas that made gas-fired
power plants a potent rival.
Now a FirstEnergy subsidiary in bankruptcy protection is
calling on Energy Secretary
Rick Perry to save it and other
hobbled coal and nuclear generators in the Midwest from closure by forcing the operator of
SenseTime Group ....... B6
Social Bicycles............B6
Bayer...........................A1
BY ERIN AILWORTH
AND RUSSELL GOLD
S
Intercontinental
Exchange.................B13
B
Weakened Utility Finds Few Allies
Zimplats Holdings......A7
a 13-state competitive power
market to take their electricity,
regardless of whether it is the
most financially sensible option.
Emergency orders have
been used lightly in the past
to keep one or a few plants
running. The emergency order
requested by FirstEnergy Solutions Corp., if approved,
would affect a whole class of
power generators across a
large, multistate region and
set an important precedent.
The request poses a test for
the Trump administration,
which has pledged to resuscitate the nation’s coal industry.
Several power companies supplying the market oppose the
proposal, with some arguing
FirstEnergy’s distress is of its
own making.
While other power generators have diversified to include more gas and renewables, FirstEnergy Solutions
remains heavily dependent on
coal and nuclear power, which
combined make up 88% of its
generation mix. “FirstEnergy
doesn’t want to evolve,” said
Abraham Silverman, vice president of regulatory affairs at
NRG Energy Inc., which operates several coal plants in the
competitive power market and
opposes the FirstEnergy request. Mr. Silverman added:
“They’d rather go to the regulators and ask for a bailout.”
FirstEnergy Solutions declined to comment. Its lawyers
pleaded with Mr. Perry for intervention March 29, saying,
“We find ourselves at a crisis
point.” Parent FirstEnergy via
email defended its Allegheny
Energy purchase as a “logical
step” at the time. It said environmental regulations, markets that undervalue its assets,
and the rise of gas have all
contributed to its problems.
Reliability and national security are the top concerns
when evaluating whether the
power grid faces an emergency, Mr. Perry said Monday
at the Bloomberg New Energy
Power Outages
Cumulative retirements of coal
and nuclear-power plants in the
PJM Interconnection grid.
30,000 megawatts
25,000
20,000
15,000
10,000
5,000
0
2010 ’12 ’14 ’16 ’18 ’20
Sources: Energy Department,
FirstEnergy Solutions Corp.
THE WALL STREET JOURNAL.
A coal-fired FirstEnergy power plant in Monaca, Pa., last year. The utility is seeking a U.S. bailout.
Finance Future of Energy
Summit in New York.
“The [emergency request]
may not be the way that we
decide that is the most appropriate, the most efficient way
to address it,” he said, adding
that his department is considering FirstEnergy’s request
and other options.
If the request is granted, it
would have significant consequences for the power market
overseen by PJM Interconnection LLC, which serves 65
million customers from New
Jersey to Illinois.
Andrew Ott, chief executive
of PJM, said that while
FirstEnergy raises “a legitimate question” about whether
the closure of coal and nuclear
plants threatens fuel security
and energy reliability, the issue hasn’t become a crisis.
A March PJM report found
most of the nuclear-power
plants in the region were economically viable at current
prices, and that while a large
number of coal-fired power
plants were at risk of retirement, there was sufficient
generating capacity to meet
anticipated demand.
—Timothy Puko
contributed to this article.
admission to the benchmark
emerging-market index run by
MSCI, which would bring tens
of billions of dollars onto the
exchange as many fund managers use the MSCI index as a
guide for where to place investors’ funds. Senior kingdom
officials expect they will get
the nod for admission in June.
“A lot of index providers
also said they’ve not seen a
country deregulate and create
changes and modifications and
improvements in their capital
market as Saudi has in the
past two years,” Mr. El Kuwaiz
said.
The Tadawul fortifying itself is now imperative, considering it may wind up being the
only exchange to list Aramco.
When the listing was first announced in 2016, Prince Mohammed told advisers he was
most interested in floating it
on the New York Stock Exchange, according to people
familiar with the potential
listing. He and senior kingdom
officials touted the possibilities of massive international
investment.
Aramco listing, and they question whether its technology
and internal controls are sophisticated enough to handle
the mammoth influx of trading
the listing would bring.
Some people familiar with
the process said the Tadawul
is likely to have further technological upgrades in place by
year-end, should Aramco seek
to list by then.
The Saudi economy remains
heavily dependent on oil,
which accounts for 74% of its
total exports and contributes
63% of budget revenues, according to UBS Wealth Management. But energy stocks
are a fraction of Saudi Arabia’s
stock market, accounting for
just 2.3% of value traded on
the Tadawul. Materials and
banks dominate the exchange
at 30% and 27%, respectively,
as of April 1.
in context, Goldman Sachs
economists calculate that in
total they will add 1.6 percentage points to U.S. effective tariffs, calculated as customs duties divided by total
imports, pushing them up to
3.1%. They think that will
knock less than 0.1 percentage point from growth even
with full Chinese retaliation.
Still, even significant tariffs wouldn’t have that much
direct impact on the U.S.
economy. Goldman calculates
that a 10% across-the-board
import tariff, six times the
size of the total measures so
far, would only knock 0.2%
off U.S. gross domestic product, assuming the rest of the
world retaliated. Inflation
would rise by a bit more
than 0.2 percentage point.
Mr. Coulton examined a
true trade-war scenario last
year, assuming 35% tariffs
were imposed on Mexico,
China, South Korea and Taiwan, and they retaliated in
full. The effect would be
messy for Americans, with a
1.3-percentage-point-lower
growth rate due almost entirely to falling stock prices.
Stocks are important because they play such a big
role in U.S. portfolios.
Threaten their value, and
consumer and business confidence crumbles, hitting the
economy and pushing stocks
down even more.
For three weeks, stock
markets have been trying to
price in the trade dangers,
and the S&P 500 has lost
about 4%, worsened by worries about technology companies. If shareholders start
to believe a serious trade
war is imminent, stocks
could fall far further and
hurt the economy, even if
Mr. Trump ultimately
doesn’t follow through.
Finally, the trade threats
come at a bad time for the
economy. Confidence in
global synchronized growth
helped push shares up to
highs at the end of January,
but since then economic data
in much of the world have
been disappointing. U.S.
shoppers have proved less
resilient than hoped, and the
Federal Reserve Bank of Atlanta’s first-quarter growth
estimate is below 2.5%, from
a high above 5% before the
stock market correction.
There is no way to know
how threats of a trade war
will interact with the complex global economy, but
they can’t help. Duh, indeed.
INDEX TO PEOPLE
J
Jing, Eric ..................... B7
B
Baumann, Werner......A1
Bezos, Jeff..................B5
Blitz, Steven.............B14
C
Chessis, Sarah ............ B7
Clement, Corrine.........B3
Coulton, Brian.............B2
Cryan, John........B12,B14
D
Deripaska, Oleg...........B1
Drahi, Patrick............B12
Posen, Adam.............B12
Pouroulis, Loucas ....... A7
K
R
Klachkin, Oren...........B14
Kou, Mariana...............B7
Krämer, Jörg.............B12
Ready, Bill...................B1
L
Learmonth, Mark........A7
Leon, Richard..............B3
Leuchten, Michael ...... B7
S
Schutte, Brent..........B13
Sewing, ChristianB1,B14
Silverman, Abraham...B2
Skerritt, Seph.............B7
Sterck, Edward............B2
M
T
Ma, Jack......................B7
Marino, Alvise .......... B14
McNamara, David.....B12
Tsai, Joe......................B6
Tskhovrebov, Victor....A7
N
Wiegand, Eric............B13
Wynn, Steve...............B3
Narasimhan, Vasant...B7
W
E
O
X
Esiner, Omer.............B14
Ott, Andrew................B2
Otting, Joseph..........B12
Xu, Li...........................B6
F-G
Fox, Jodie....................B7
Fung, Spencer.............B7
Grant, Hugh................A1
P
Peng, Lucy...................B7
Petraglia, Michael .... A16
BRIAN SNYDER/REUTERS
A
Achleitner, Paul ........ B12
Ash, Timothy..............B1
Athey, James............B13
Z
Zindler, Ethan.............B6
Zuckerberg, Mark
.......................... B1,B4,B5
RUSSIA IPO
Continued from the prior page
defaults in relation to certain
credit obligations.”
The specter of disruptions
hit global aluminum markets,
which jumped 4.8% in London
trading. London commodities
broker SP Angel estimates
Rusal’s primary aluminum output last year accounted for
about 6% of global production.
Rusal was one of 12 companies that the U.S. government
sanctioned Friday. A Kremlin
spokesman on Monday called
the measures unlawful and
said the government was preparing a response.
En+ Group PLC, a Londonlisted company that is majority owned by Mr. Derispaska
and holds a 48% stake in
Rusal, as well as power companies in Russia, said it was
“highly likely” that the sanctions would hurt its business.
En+ shares fell 42% Monday.
Western firms that have
partnered with Russian firms
now on the sanctions list were
assessing new risks. Swiss engineer Sulzer AG said it had
agreed to buy shares from its
main owner, Renova Holdings,
which appeared on the sanctions list, in order to comply
with the sanctions. Sulzer
shares fell 16% in Swiss trading.
Swiss-based mining and
trading giant Glencore PLC
holds a nearly 9% stake in
Rusal and Glencore Chief Executive Ivan Glasenberg has
been a Rusal board member
since 2007. It is unclear if the
sanctions directly affect that
shareholding. Glencore declined to comment. The company’s shares fell 3.4% in London trading.
The new U.S. restrictions
make it all but impossible for
Rusal and other sanctioned
companies to do business in
dollars, analysts said, raising
questions about their banking
and trading relations.
The U.S. government said
that non-U.S. citizens may face
sanctions for “facilitating significant transactions” for
sanctioned individuals or entities. That could make activities as simple as exchanging
currencies more expensive for
Rusal, given the international
scope of its operations and the
fact that sales are priced in
U.S. dollars, said Edward
Sterck, an analyst at BMO
Capital Markets.
—Ira Iosebashvili
contributed to this article.
Continued from the prior page
Still, there are doubters. “I
don’t think the Saudi local
market can float a $100 billion
IPO,” said Babatunde Ojo, an
analyst and frontier- and
emerging-markets portfolio
manager at Harding Loevner,
referring to the amount the
kingdom has said it hopes to
raise in an Aramco IPO.
But Mr. Ojo also called the
FTSE inclusion a “stamp of approval that Saudi is open for
business” and that “international investors should have
no problem investing in
Saudi.”
Now that Saudi Arabia has
landed a spot on the FTSE index, the kingdom is waiting to
see whether it will also gain
STREET
Continued from the prior page
trade threats are part of the
president’s “art of the deal”
and will be negotiated down.
Impossible to measure is the
danger that the trade threats
prove to be the straw that
breaks the back of a global
economy already showing
plenty of signs of strain.
The direct effect of the
tariffs, even assuming they
come fully into force, isn’t
that significant. Brian Coulton, chief economist at Fitch
Ratings, thinks they amount
to a hit of 0.3% of China’s
economy, not much in the
context of Beijing’s target of
6.5% expansion this year.
The effect in the U.S. is
smaller, although growth
there is lower, too.
To put the trade frictions
Duty Bound
Tariffs are far lower than in the past.
60%
Average dutiable tariff*
40
20
0
1800
’50
1900
*Ignores duty-free imports
Source: Prof. Douglas Irwin, Dartmouth College
Planned
retirements
’50
2000
THE WALL STREET JOURNAL.
$500B
Current market value of
companies trading on Tadawul
But potential legal and regulatory hurdles of an international Aramco IPO have become more complicated than
initially expected, leading
kingdom officials to look more
carefully at a domestic-only
listing.
The Tadawul was closed to
foreign investors until 2015,
but it has registered 130 international financial institutions
since then. Still, international
investors account for roughly
5% of the overall ownership of
stocks listed on the exchange,
even as regulators have made
it easier for international investors to trade there.
The Tadawul’s changes include settling trades within
two days and having numerous agents, known as custodians, to execute trades. It has
lowered the minimum assets
under management required
to invest there, allowed investors to bet against the market
by shorting stocks and pushed
back limits on foreign investments in Saudi stocks.
Still, even with upgrades,
advisers worry the Tadawul
could be overwhelmed by an
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THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | B3
* * * * * *
BUSINESS NEWS
U.S. Faces Grilling in AT&T Case
In sharp remarks to
government lawyers,
Richard Leon focuses
on substance, procedure
BY LINGLING WEI
BY BRENT KENDALL
BOAO, China—Chinese President Xi Jinping promised foreign companies greater access
to China’s financial and manufacturing sectors, pledging
Beijing’s commitment to further economic liberalization
amid rising trade tensions
with the U.S.
In a speech that officials
had billed as a major address,
Mr. Xi said Tuesday that plans
are under way to accelerate
access to the insurance sector,
expand the permitted business
scope for foreign financial institutions and reduce tariffs on
imported automobiles and
ownership limits for foreign
car companies.
Throughout his 40-minute
address, Mr. Xi never mentioned the trade friction with
the U.S. or President Donald
Trump. His remarks seemed
designed to offer some policy
initiatives, if not concessions,
while drawing a contrast with
Mr. Trump’s “America First”
agenda and portraying China
as a steady global partner
committed to the international
trade order.
“In a world aspiring for
peace and development, the
Cold War and zero-sum mentality look even more out of
place,” Mr. Xi told the Boao
Forum, a government-backed
gathering of business and political leaders on the tropical
island of Hainan.
“Putting oneself on a pedestal or trying to immunize oneself from adverse developments will get nowhere,” he
said.
Washington and Beijing’s
trade spat has become a
source of financial-market turbulence in recent weeks and
raised concern about an outright trade war that could
drag down the global economy.
WASHINGTON—As he presides over the trial of AT&T
Inc.’s planned acquisition of
Time Warner Inc., U.S. District Judge Richard Leon enters his courtroom each day
sporting a bow tie and armed
with a handful of pencils,
which he often sharpens as
the lawyers introduce themselves.
His comments from the
bench can also be sharp.
Over three weeks of proceedings, Judge Leon, a 16year veteran of the Washington, D.C., court, has run an
exacting trial, and his management of the case has presented a challenge for the Justice Department as it seeks to
block the $85 billion deal on
antitrust grounds. The judge,
an appointee of President
George W. Bush, has pressed
government lawyers on issues
of style, procedure and substance as they have presented
16 witnesses so far.
The department’s principal
arguments, which may wrap
up this week, will be followed
by AT&T and Time Warner
presenting their defense,
which will put their own lawyers in the hot seat.
Judge Leon has chastised
the Justice Department for
moving too fast. “Ma’am, I
said hold on a minute,” the
judge told one department
lawyer on Thursday as she
was questioning an AT&T witness. “Listen!” the judge told
her, pointing to his ear for effect while he looked at a document. Two other department
lawyers, including a junior
member of the team, have received similar admonishments.
The judge also has criticized the government for moving too slow. “Ask him a question. Let’s go,” he said to
L. BARRY HETHERINGTON
China’s Xi
Vows More
Access to
Industries
U.S. District Judge Richard Leon alone will decide the fate of AT&T-Time Warner deal. There is no jury.
another government attorney
after telling him not to waste
time repeating a witness’s answers. On another sluggish
morning, the department told
the judge it had only a few
more questions for a marketing professor who was a witness on the stand.
“Good,” Judge Leon responded.
No single limitation imposed by the judge has appeared to be a major setback
for the Justice Department,
but collectively, the instances
have crimped how the government has presented its case
against the deal.
The judge has kept the
courtroom open to the public
for most of the proceedings.
That is a boost for transparency, but it has been a visible
frustration for Justice Department attorneys who have had
to dance around questions involving sensitive business data
and strategy documents that
can’t be discussed in open
court.
“Explain as much as you
can without revealing confidential information,” the Justice Department’s lead trial
lawyer, Craig Conrath, told an
industry consultant on the
witness stand last week.
Judge Leon alone will decide the fate of the merger,
which would combine AT&T’s
pay-TV distribution capabilities with Time Warner’s stable
of cable channels. There is no
jury.
The judge has been strict
about what internal company
documents and emails he is
willing to consider as evidence. He also has curbed the
questions the government has
been able to ask certain wit-
nesses, including those from
AT&T, particularly as they related to internal company
communications.
The judge signaled from the
outset he would take such a
rigorous approach, telling the
department he wouldn’t allow
company documents like internal PowerPoint presentations
without knowing who wrote
them, when and why they
were created, and whether
company decision makers relied on the information.
“I’m going to need context,”
Judge Leon said in a pretrial
hearing last month, adding
that he wanted to be “cautious” about making assumptions.
Judge Leon has a reputation for putting lawyers
through their paces. He also
hasn’t been afraid to hold the
government’s feet to the fire,
including in cases where litigants sought State Department records from Hillary
Clinton’s tenure, and challenged the National Security
Agency’s bulk collection of
phone-call records, a program
Judge Leon labeled “almost
Orwellian” in 2013.
Discussions about evidence
relevancy and confidentiality
have become a central feature
of the AT&T trial, with Judge
Leon interrupting witness testimony to call lawyers to the
bench for private conferences,
often a half-dozen times or
more a day. Sometimes these
huddles last just a few minutes. Other times, their duration has stretched 15 minutes
or longer.
Spectators and witnesses
can watch but can’t listen. The
judge turns on a “husher” that
plays static on the courtroom
speakers to drown out the
conversation at the bench.
There isn’t much for the audience to do during the dead
time other than attempt to lipread, as courtroom visitors are
held to their own firm code of
conduct. They can’t drink water or glance at newspapers or
magazines. While policing the
gallery, some court security
officials have instructed visitors to keep both feet on the
floor at all times, lest their
shoes rub up against the row
in front of them.
The zero-tolerance policy
applies most forcefully to
computers and cellphones. On
most days, security officials
have searched visitors’ bags
before entering the courtroom
and asked people to show
their electronic devices to
prove they are turned off. Still,
a couple of people have heard
the mortifying ring of their
phones during the proceedings, and they have been removed immediately from the
courthouse.
“These are Judge Leon’s orders and they will be followed,” one court officer said
in the hallway.
—Drew FitzGerald
contributed to this article.
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C-0917-12272 09-15-18
.
B4 | Tuesday, April 10, 2018
THE WALL STREET JOURNAL.
* ***
TECHNOLOGY
WSJ.com/Tech
Zuckerberg Says Sorry for Harm Done
Facebook chief sets
his testimony as
lawmakers take up
issue of data privacy
Remarks From
Company’s CEO—
And a Skeptic
BY SIOBHAN HUGHES
MICHAEL REYNOLDS/EPA/SHUTTERSTOCK
WASHINGTON—Facebook
Inc. Chief Executive Mark Zuckerberg will tell lawmakers this
week that his company “didn’t
take a broad enough view of
our responsibility” and will lay
out steps to make it right, following revelations about the
abuse of users’ personal information and election interference by Russian operatives.
“As Facebook has grown,
people everywhere have gotten
a powerful new tool to stay
connected to the people they
love, make their voices heard,
and build communities and
businesses,” Mr. Zuckerberg
says, in prepared testimony released by a House committee
on Monday. “But it’s clear now
that we didn’t do enough to
prevent these tools from being
used for harm as well.”
His testimony continues
what amounts to an apology
tour that he started after the
disclosure that user data was
improperly shared by an analytics firm tied to the 2016
campaign of President Donald
Trump. Last week, Facebook
disclosed that data from as
many as 87 million of its users
may have been improperly
shared, up from the 50 million
previously reported.
Mr. Zuckerberg will testify
Tuesday at a hearing hosted
by the Senate Commerce, Science and Transportation Committee and the Judiciary Committee, and Wednesday at the
House Energy and Commerce
Committee.
“As Facebook has grown,
people everywhere have gotten
a powerful new tool to stay
connected to the people they
love, make their voices heard,
and build communities and
businesses. But it’s clear now
that we didn’t do enough to
prevent these tools from being
used for harm as well.”
On a series of issues including “fake news,” interference in
elections and hate speech, he
says in the prepared testimony:
“We didn’t take a broad enough
view of our responsibility, and
that was a big mistake.”
Mr. Zuckerberg adds: “It was
my mistake, and I’m sorry. I
started Facebook, I run it, and
I’m responsible for what happens here.”
In visiting Capitol Hill, Mr.
Zuckerberg is venturing into
hostile territory that is a world
apart from the tightly scripted
venues to which he is accustomed. The 33-year-old billionaire will have his composure
tested by sharp questioning from lawmakers, some of
whom say that Mr. Zuckerberg’s mea culpas aren’t
enough.
“It’s really a kind of high
noon for Mark Zuckerberg,”
said Sen. Richard Blumenthal
nies and individuals were
charged in the U.S. with engaging in an effort to interfere in
the 2016 presidential election,
using Facebook and other social-media platforms.
Mr. Zuckerberg’s prepared
testimony lays out steps the
company has taken to prevent
abuse of users’ data and to protect elections from interference. He says the company’s
security and content-review
staffing will reach 20,000 by
year-end, and notes that the
move will “significantly impact
our profitability going forward.”
The steps Facebook is taking
include limiting the amount of
personal information that developers can access when a
user approves a particular application. Under the new policy,
developers will only be able to
access a user’s name, profile
photo and email address—and
(D., Conn.), a member of the
Senate panel that will query
the CEO on Tuesday. “He has to
have a better answer than just,
‘I made a mistake.’ He didn’t
just spill milk on the breakfast
table. There is a more fundamental issue related to Facebook’s business model,” Sen.
Blumenthal said in an interview.
Facebook is under fire for a
range of perceived offenses, including helping to spread disinformation and allowing Cambridge Analytica, a Londonbased firm with ties to the
Trump campaign, to access information from tens of millions
of user profiles. Among other
things, legislators will likely
probe whether Facebook violated a consent order with the
Federal Trade Commission requiring the company to safeguard user data.
In February, Russian compa-
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lumbia University law professor
and a former senior adviser to
the agency.
For example, while it could
impose large fines on a company for violating a consent decree, like the one Facebook
agreed to in 2011, the FTC often
has limited ability to impose
fines in the privacy realm.
Hone antitrust powers: The
FTC and Justice Department
could use their mandates to determine that the sheer size of
THE WALL STREET JOURNAL.
little precedent to use antitrust
powers to police misuse of data,
and skeptics say such a move is
a stretch legally.
Push for portability: Many
advocate giving consumers
more control over their personal
information, including through
legislation empowering them to
move their data from one platform to another, a concept
known as portability. That way,
“platforms will compete for consumers and offer what the mar-
ket demands in terms of privacy
protection,” said Rep. David Cicilline (D., R.I.), who is exploring
legislation on the issue.
More transparency: Another
approach would be to require
companies to disclose how they
collect, share and otherwise use
consumer data. But that would
involve delving into corporate
secrets such as algorithms and
is likely to encounter fierce resistance from big tech firms.
Facebook recently said it would
support legislation to require
large digital platforms to keep a
public library of the paid political ads that appear on their
sites.
Defer to the states: States
have been successful in bringing
some actions, said Jessica Rich,
a former director of the FTC’s
consumer protection bureau.
But a federal law is needed to
help establish clear rules that
businesses and consumers alike
could understand. “Right now
there’s no clarity,” Ms. Rich concludes.
Follow Europe: The European Union has a new and farreaching privacy rule that goes
into effect May 25. But the full
extent of its impact remains to
be seen.
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Facebook and other tech giants
causes consumer harm not because of price gouging—a traditional measure of antitrust violations—but because of misuse
of consumer data.
“I definitely think that dataprotection issues…are a feature
of a deeper problem, which is
that Facebook has a semimonopolistic control over data,”
said Lina Khan, director of legal
policy at the Open Markets Institute, a think tank. But there is
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tenberg, president of the Electronic Privacy Information Center.
Should it conclude Facebook
has violated its agreement with
users, as many expect, FTC
could hold the company to specific conditions that force better
treatment of user data. But such
a move might not address problems in the industry as a whole.
The FTC’s current enforcement approach “doesn’t seem
very toothy,” said Tim Wu, a Co-
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tigating every app that had access to a large amount of information” before the company
tightened its policies in 2014.
“If we detect suspicious activity, we’ll do a full forensic audit.”
“The question that they
have so far been unable to answer is, ‘How many Cambridge
Analyticas are there?’ ” Sen.
Blumenthal said. “Either they
truly don’t know or they’re unwilling to tell—I don’t know
which is more damning.”
Cambridge denies using data
that it wasn’t authorized to
have as part of its work on the
2016 presidential election.
—Byron Tau
contributed to this article.
Alphabet
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will have to obtain additional
approval to ask users to access
their posts or other private
data.
Facebook is also requiring
advertisers seeking to run ads
on divisive political issues to go
through an authorization process. The move could help prevent the spread of disinformation, because advertising was
one way Russian-backed trolls
attempted to sow divisions.
Lawmakers have asked Facebook whether other firms may
also have engaged in the same
practices as Cambridge Analytica. Mr. Zuckerberg says in his
prepared testimony that Facebook is looking into the matter
and is “in the process of inves-
2017 lobbying expenditures by selected tech companies, in millions
Qualcomm
* * *
“I’ve directed our teams to
invest so much in security—on
top of the other investments
“It was my mistake, and I’m
sorry. I started Facebook, I run
it, and I’m responsible for what
happens here.”
Raising Their Voice
MLADEN ANTONOV/AGENCE FRANCE-PRESSE/GETTY IMAGES
Continued from page B1
to end the legal immunity for
websites that facilitate sex
trafficking online, a big signal
that Congress could take further steps to hold platforms
more accountable.
“I think it’s a wake-up call,”
Commerce Committee Chairman
John Thune (R., S.D.) said when
asked what the sex-trafficking
bill might mean for privacy regulation and other potential
curbs on Silicon Valley. “In the
future, tech companies have to
understand that it’s not the
Wild West, and they have to exercise responsibility,” he said.
Leverage the FTC: As the
government’s chief privacy regulator, the FTC is already conducting a sweeping investigation of Facebook’s privacy
practices; and advocates believe
it has a powerful case, contending the company violated terms
of a 2011 FTC agreement concerning its user-privacy practices. “The FTC had a legal judgment against Facebook to
prevent precisely the practice
that occurred,” said Marc Ro-
“If we detect suspicious activity, we’ll do a full forensic
audit. And if we find that
someone is improperly using
data, we’ll ban them and tell
everyone affected.”
“It’s really a kind of
high noon for Mark Zuckerberg.…He has to have a better
answer than just, ‘I made a
mistake.’ He didn’t just spill
milk on the breakfast table.
There is a more fundamental
issue related to Facebook’s
business model—they sell your
information without your consent. That’s what has to
change.”
—Sen. Richard Blumenthal,
a member of the panel that
will query Mr. Zuckerberg
"We didn’t take a broad
enough view of our responsibility, and that was a big mistake.”
Mark Zuckerberg visited Capitol Hill on Monday ahead of his congressional appearance this week.
we’re making—that it will significantly impact our profitability going forward. But I want
to be clear about what our priority is: protecting our community is more important than
maximizing our profits.”
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BY ALLISON PRANG
Facebook Inc. will launch a
research initiative to understand how social media can be
manipulated to affect democracy and elections, founder
Mark Zuckerberg said in a
post on the platform Monday.
The move adds to steps the
company has announced ahead
of Mr. Zuckerberg’s much-anticipated congressional testimony this week.
In response to criticism it
hasn’t done enough to protect
users’ privacy and guard
against abuses of the platform,
Facebook has proposed revisions to its data policy and
terms of service, banned more
Russian trolls from the site
and required that advertisers
wanting to spotlight hot-button political issues get prior
authorization.
The research initiative is
part of the company’s attempt
to address concerns about
how political parties, interest
groups and even foreign countries can manipulate the platform to influence a nation’s
elections.
Mr. Zuckerberg, who is also
Facebook’s chief executive,
said the company will work
with foundations and academics to develop an election-research agenda. The group will
solicit independent research
proposals and choose which
will get funding.
Mr. Zuckerberg said Facebook will “give those research-
ers access to our resources so
they can draw unbiased conclusions about Facebook’s role
in elections.”
Research from the initiative
will be made public, the company said.
“The goal is both to get the
ideas of leading academics on
how to address these issues as
well as to hold us accountable
for making sure we protect the
integrity of these elections on
Facebook,” Mr. Zuckerberg
said in his post.
Employees Appear to Be Unfazed by Crisis
Facebook Inc. may be losing
friends over its privacy policies
but its employees appear to be
By Georgia
Wells, Deepa
Seetharaman
and Yoree Koh
rallying around the company.
The state of employee morale is being closely monitored
at Facebook, according to some
employees, which must compete for talent in Silicon Valley
even as it embarks on a raft of
changes in response to criticism
from regulators and users.
“I worry it’ll make it much
more difficult to step up to the
challenges we face,” Adam Mosseri, the head of Facebook’s
news feed tweeted at the end of
March. He didn’t respond to a
request for comment.
But thus far, many employees appear to have adopted a
siege mentality, with some saying they feel the outrage toward
Facebook is misplaced, according to interviews with a number
of current and former staffers.
A common refrain: The issues
are mostly being hyped by the
media.
Many within Facebook said
they continue to believe the
company is being unfairly
picked on. Several said they
viewed the privacy failure as in-
competent, but not malicious.
As Facebook CEO Mark Zuckerberg has done, they argue that
the company’s ability to connect people is overall a good
thing, and that Facebook will
emerge from this episode stronger for having learned from its
mistakes. The company declined
to comment on morale.
It helps that morale at the
company was generally good
when the crisis hit. That sentiment at Facebook was fueled
partly by efforts by management in recent years to improve
work-life balance.
Indeed, Facebook’s rating on
Glassdoor, where employees can
review their workplaces, has re-
mained between 4.5 and 4.6 out
of 5 during the past nine quarters and hasn’t dropped since
the Cambridge Analytica breach
was announced.
There are signs the crisis is
having an effect on luring talent: Since the disclosures, more
candidates for jobs in some
units at Facebook have withdrawn from consideration than
during any other period in
memory, according to a person
familiar with its recruiting. Mr.
Zuckerberg said in a recent
company meeting that the userdata flap didn’t seem to be deterring job applicants broadly
across the company, said a person familiar with the matter.
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | B5
TECHNOLOGY
Bezos Silent About Attacks
Sensing Urgency,
Facebook Bolsters
User Protections
When Facebook Inc. Chief Executive Mark Zuckerberg appears before Congress this week,
he will lay out a number of steps
the company has already taken
to protect user data.
It will be up to lawmakers and
regulators to decide whether
they can rely on the social network to police itself or if new
regulation from Washington is
needed.
At least one committee chairman, Sen. John Thune (R., S.D.),
whose Commerce panel will be
holding a joint hearing with the
Senate Judiciary Committee on
Tuesday, said in his statement
announcing the hearing that he
expects to hear the company’s
plans for rectifying the privacy
problems.
“Facebook now plays a critical
role in many social relationships,
informing Americans about current events, and pitching everything from products to political
candidates,” Sen. Thune said.
“Our joint hearing will be a public conversation with the CEO of
this powerful and influential
company about his vision for addressing problems that have generated significant concern about
Facebook’s role in our democracy, bad actors using the platform, and user privacy.”
Here are some of the modifications Facebook has made in recent weeks:
Authorizing ads: Facebook
said it would soon require advertisers wanting to run ads on
divisive political issues to go
through an authorization process. The move could help prevent the spread of misinformation, because it is one way the
Russian-backed trolls attempted
to sow divisions around the 2016
U.S. election.
Limiting contact data: Facebook shut off a service that allowed people to find other users
by phone number or email address. The company said bad ac-
tors were exploiting the service
to scrape public information, potentially affecting most Facebook
users. Critics say this does little
to preserve the privacy of users
whose information was already
collected.
New terms of service: Facebook released proposed revisions to its terms of service and
data policy that provides users
with greater detail about how it
collects and deploys its vast
troves of information about its
users.
Critics say this move is important because it provides users, regulators and advocacy
groups with information that
they can use to hold Facebook
accountable in the future.
Curbing ad targeting: Facebook shut down a system that let
data brokers combine shopping
and other information on consumers that Facebook used to incorporate into its ad-targeting
system.
Facebook and other companies are under pressure from European Union authorities to
make sure all targeting data are
collected with user permission,
and verifying that could have
been difficult with the data from
the brokers.
More security: Shortly after
Facebook disclosed that Russian
trolls attempted to sow misinformation and exacerbate divisions
on its platform last fall, the company said it would hire more
workers dedicated to security
and content review and making
sure ads on its platform complied with its policies.
Last Wednesday, Mr. Zuckerberg said Facebook now has
about 15,000 people working on
this, and plans to expand that
number to 20,000 by the end of
this year.
Facebook’s playbook during
crises has been to add more
workers to hot-button issues;
critics say this approach does little to address the underlying
reasons for the crises.
BY LAURA STEVENS
AND PETER NICHOLAS
For years, Amazon.com Inc.
Chief Executive Jeff Bezos has
meticulously crafted his public
image, largely shunning the
spotlight while carefully making
donations that only hint at his
political agenda. But over the
past week, the billionaire has
been cast into the limelight,
thanks to a string of attacks by
President Donald Trump.
Mr. Bezos’s response? The silent treatment.
In six tweets over a week,
Mr. Trump lashed out at Amazon repeatedly over taxes, its
use of the U.S. Postal Service
and its effect on other retailers.
He also called the Washington
Post, which Mr. Bezos owns personally, a lobbying arm. He criticized Amazon at a press conference on Tuesday, too, and
aboard Air Force One on Thursday.
The tweets and remarks stem
largely from Mr. Trump’s growing unhappiness with coverage
of his administration by the
Washington Post as well as with
its owner, say the president’s
advisers and people close to the
White House.
Mr. Bezos, the world’s richest
man, has ignored the president’s
attacks. He has stayed out of the
public eye since Mr. Trump’s
tweets started last week, only
tweeting once to send condolences regarding the recent
shooting at YouTube’s headquarters.
Mr. Bezos made comments
critical of Mr. Trump before the
election, but he has refrained
from public criticism since Mr.
Trump was elected. That strategy, people familiar with this
thinking say, fits in with his
deeply held conviction in playing the long game.
“I don’t think there’s any
benefit to actually engaging
with President Trump” as a
DAVID PAUL MORRIS/BLOOMBERG NEWS
BY GEORGIA WELLS
Slammed by President
Trump, Amazon’s CEO
chooses to refrain
from comment
Unlike other CEOs, the world’s richest man tweets rarely and speaks publicly only on occasion.
CEO, said Paul Argenti, professor of corporate communication
at Dartmouth College’s Tuck
School of Business. “He clearly
doesn’t like them,” he said of
Mr. Trump’s view of Amazon.
“There’s no sense in fighting
back.”
An Amazon spokesman declined to comment. The White
House also declined to comment.
Some CEOs have spoken up
after Mr. Trump has criticized
them or their companies. Facebook Inc. Chief Executive Mark
Zuckerberg in a September post
rebutted Mr. Trump’s tweet that
“Facebook was always antiTrump.” AT&T Inc. CEO Randall
Stephenson hinted at the president’s criticism of the company’s merger plans at a November conference, saying the
company wouldn’t back down in
its bid for Time Warner Inc.
Other CEOs, such as Goldman
Sachs Group Inc.’s Lloyd Blankfein, have publicly criticized the
president in response to positions such as his ban on travel-
ers from certain countries.
Mr. Bezos has long tread
carefully when it comes to politics. The chief executive has
made calculated public donations, like one for Dreamer
scholarships in January. He
tweets rarely and chooses to
speak publicly only on occasion.
His last major public interview
was granted to his brother on
stage at a conference in November.
Still, as concerns about Amazon’s growing power have ballooned in recent months, Mr.
Bezos has been seen more publicly. He starred in the company’s Super Bowl commercial
this year and has been making
the rounds at Hollywood award
shows and parties. Last month,
he tweeted a photo of himself
with a robotic dog at his exclusive Mars conference in Palm
Springs, Calif.
Mr. Bezos was critical of Mr.
Trump in the months before the
election. In 2015, Mr. Bezos responded to a critical tweet from
Mr. Trump by suggesting he
could offer the then-candidate a
ride on a spaceship. “#sendDonaldtospace,” he added. At a conference in 2016, shortly before
Mr. Trump was elected, Mr. Bezos said the candidate “erodes
democracy around the edges.”
Amazon became one of the first
companies to sign on to a legal
challenge to Mr. Trump’s travel
ban last year, too, as Mr. Bezos
sent an email to staff explaining
his move.
Executives inside Amazon
say they are aware of the perception of the company’s growing dominance as it expands
into new business areas and
weaves its ways into consumers’
lives—from its Whole Foods
stores and Hollywood studios to
its experimentation with health
care and financial services. The
company has worked to improve
its public image and its lobbying
efforts, according to a person
familiar with the matter. And it
has made big splashes by announcing it was creating tens of
thousands of jobs, including at a
new second headquarters.
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THE WALL STREET JOURNAL.
B6 | Tuesday, April 10, 2018
TECHNOLOGY
BY TRIPP MICKLE
AND TIMOTHY PUKO
Apple Inc. said Monday
that it has achieved a decadeold goal of having its facilities
world-wide powered exclusively by renewable energy, an
achievement that will shift the
company’s sustainability efforts to its supply chain,
where about 10% of suppliers
have made a similar commitment.
The tech giant said it has
improved to be 100% reliant
on clean energy from 96% last
year in part by contracting renewable energy for the first
time in India, Turkey, Brazil
and Mexico. The figure covers
all of the company’s retail
stores, offices, data centers
and partner data centers, as
well as its new headquarters
in Cupertino, Calif., Apple
Park, the spaceshiplike structure that features rooftop solar panels and is one of the
largest on-site solar installations in the world.
Apple is just one of many
global corporations trying to
cut energy consumption and
shift to renewable power including wind and solar, both
to cut costs and slow climate
change. More than 100 companies world-wide, including Apple, IKEA, Anheuser-Busch InBev SA and Starbucks Corp.,
pledged in 2014 to shift to
100% renewable energy. By the
end of 2016, 25 had met the
pledge, according to the collaborative, named RE100.
In recent years, large investors have been pushing for
companies to disclose more
JUSTIN SULLIVAN/GETTY IMAGES
If you upgraded your
iPhone to iOS
11.3, which
rolled out
over the past
week or so, look at the Battery section of Settings, under a new menu called Battery Health. That’s where
you will find crucial information about the health and
longevity of your phone. It
also gives you the ability to
prevent your phone from
being slowed down because
of poor battery health.
The new feature, still in
the potentially buggy beta
stage, appears months after
Apple came under fire for
slowing down (aka throttling) older iPhones without
disclosing the practice to
users.
Battery Health begins
with a measure of your
phone battery’s maximum
capacity, its ability to hold a
charge compared with its
original state.
Over time, lithium-ion
batteries store less power
each time they charge, and
can degrade based on how
often you charge the phone,
the temperature at which
you store it and other factors. The lower that percentage, the shorter your
battery life.
Shorter battery life corresponds with a higher susceptibility to unexpected
crashes, says Apple. This
was the root of its rationale
for throttling.
In my testing, on a nearly
new iPhone X, the battery’s
maximum capacity was still
100%, while another I
checked was already at 98%.
A year-old iPhone 7 showed
99%, and a three-year-old
iPhone 6S was down to 93%.
Two iPhone SEs displayed
87% and 86%.
The second section of
Battery Health is Peak Performance Capability, which
informs users whether their
device is being throttled.
The best news you’ll get
here is, “Your battery is currently supporting normal
peak performance.”
When you update to iOS
11.3, you’re likely to see it.
Apple says the throttling
software, known as “performance management,” will be
initially disabled, but “it
will be re-enabled if the device subsequently experiences an unexpected shutdown.”
If that happens, you’ll see
a message saying, “Performance management has
been applied to help prevent
this from happening again.”
Apple says the throttling
applies to iPhone 6, 6 Plus,
6S, 6S Plus, 7, 7 Plus and SE
models.
Apple says the newer
iPhone 8, 8 Plus and X are
designed to manage power
better to avoid crashes.
You can disable performance management and go
back to using your phone as
normal—though Apple says
that increases the chances
of another crash, at which
point the throttling software will again automatically activate.
You can also leave the
management to its business,
and get used to your
slightly slower iPhone. Or
you can replace your battery. The Battery Health
page begins recommending
you do so once your maximum capacity slips below
about 80%.
You can get a new battery
for an iPhone 6 or later at
any Apple store for $29
through the end of 2018.
Once you have replaced
your battery, it will go back
to working at full blast.
You won’t need to look at
Battery Health often. Still,
you should check it at least
once to make sure your battery is still pumping juice
smoothly, or if you have the
feeling that your phone has
gotten slower lately.
If something is wrong,
you will feel better knowing
you aren’t crazy—and that
there’s a fix for it.
Facilities world-wide
are now fully reliant
on renewable energy;
suppliers to face push
Apple’s new headquarters in California features rooftop solar panels and is one of the largest on-site solar installations in the world.
about both their environmental impact and their efforts to
mitigate the environmental
risks. BlackRock Inc., which is
one of Apple’s largest investors, added climate change
last year to the list of topics it
discusses with the companies
in which it invests, for example. It also joined with Vanguard Group in supporting a
shareholder proposal that
called on Exxon Mobil Corp. to
share more information about
how climate change could affect its operations.
Many of the RE100 companies are now trying to accelerate efforts to persuade their
suppliers to join them. While
becoming 100% dependent on
clean energy at the company’s
facilities is an achievement,
environmental experts said the
bigger challenge will be making the manufacturers of the
more than 200 million iPhones
and 43 million iPads it sells
annually wholly dependent on
renewable energy.
“We’re not going to stop
until our supply chain is 100%
renewable,” said Apple Vice
President of Environment Lisa
Jackson in an interview with
The Wall Street Journal.
Apple, which set that goal
two years ago, said nine more
of its suppliers have committed to powering all production
with 100% clean energy, bringing the total to 23 out of more
than 200 suppliers. Many of
those suppliers are in Asian
countries without the same
pressure from consumers and
investors that Apple gets in
the U.S.
Those countries “do not
have the same ingrained sense
of corporate responsibility
that Apple has,” said Ethan
Zindler, the head of U.S. research at Bloomberg New Energy Finance.
Ms. Jackson added that Apple also will be challenged to
keep its own facilities at the
100% level in the years ahead,
especially as it looks to add a
new campus in the U.S. and
$10 billion in data centers.
Apple has been a supporter
of environmental issues for
years. Chief Executive Tim
Cook pressed for the U.S. to
stay in the Paris climate treaty
and sent a memo to employees
saying that climate change is
real. The company last week
stated its opposition to repealing the Clean Power Plan in a
letter filed with the Environmental Protection Agency, saying it would increase investment uncertainty.
“We think that it’s a matter
of good policy and good sense
to move toward cleaner forms
of energy,” Ms. Jackson said.
Alibaba Invests in Facial-Recognition Startup
BY LIZA LIN
SHANGHAI—Chinese
ecommerce company Alibaba
Group Holding Ltd. is leading
a $600 million funding round
in SenseTime Group Ltd.,
which makes surveillance systems using facial recognition
for law enforcement and commercial applications.
The funding values Beijingbased SenseTime at more than
$4.5 billion, according to a
person familiar with the company. It also underscores Alibaba’s move into businesses
that use artificial intelligence,
the technology that underpins
facial recognition.
Alibaba affiliate Ant Financial Services Group has developed a mobile-payment system
based
on
facial
recognition, and Alibaba is
also using AI to develop socalled smart cities where technology is used to dispatch police, speed traffic flow and
regulate other public services.
Smart cities and cloud computing are likely areas of cooperation with Alibaba, SenseTime Chief Executive Xu Li
said in an interview.
SenseTime’s surveillance software can be used to monitor customers in a department store.
“They have strong infrastructure capabilities to build
a cloud and deliver fundamental resources, while we are
good at building computer vision and related infrastructure,” Mr. Xu said.
“The capabilities between
us complement each other
quite well,” he added.
Alibaba Executive Vice
Chairman Joe Tsai said in a
written statement that his
company was impressed with
SenseTime’s technology that
allows computers to recognize
images, as well as its development of deep-learning technol-
ogy, in which software mimics
the way neurons in the brain
process information.
Alibaba’s share in the $600
million Series C funding round
wasn’t disclosed. Other investors include Singapore state
investment company Temasek
Holdings Pte. Ltd. and Chinese
electronics retailer Suning.com Co.
Founded in 2014, SenseTime is among a handful of
Chinese artificial-intelligence
startups that got their start
selling facial-recognition systems to local police agencies.
With a vast network of surveillance cameras, China is using facial recognition to identify criminal suspects as well
as to influence behavior, such
as discouraging jaywalking.
The technology also has
commercial applications, with
some companies now using it
instead of badges to grant employees access to their workplaces. Mr. Xu said SenseTime
would use the new funding to
focus on expanding the technology’s commercial applications and artificial-intelligence
capabilities.
SenseTime is also developing algorithms for autonomous
driving, as a partner with
Honda Motor Co., and is
working with Shanghai’s government to use AI to ease traffic congestion.
—Dan Strumpf
in Hong Kong
contributed to this article.
Uber to Acquire Cycle-Rental Startup Jump Bikes
BY GREG BENSINGER
Uber Technologies Inc. has
agreed to buy an on-demand
electric-bike outfit that could
help the ride-hailing company
expand its service to customers
traveling short distances.
The deal for Jump Bikes, recognizable for its bulky red bicycles with large baskets, gives
Uber access to customers in
Washington and San Francisco,
where the startup has a few
hundred bikes available to rent
in increments of 30 minutes for
$2. Uber, which isn’t releasing
terms, expects the deal to close
within the next few weeks.
Uber has had a trial with
Jump, whose parent is Social
Bicycles Inc., since February in
San Francisco, allowing some
customers to rent the bikes directly through its app instead of
through the Jump app. Customers can reserve the bikes and
unlock them using a code they
type into a keypad on the bikes.
Uber is entering a highly
competitive market that requires heavy investment. Several companies are duking it out
for customers who want to bike
around a city, offering discounted or even free rides to
gain market share. And municipalities have struck deals to allow docked bikes that preclude
other companies from entering
the market.
Unlike some other competitors, Jump requires customers
to tether the bikes to a pole or
other secure structure using its
built-in locking mechanism, or
face a fee.
Jump’s electrified bikes
make cycling easier with a
small electric motor. But they
are more costly to produce and
heavier and more sluggish
than a traditional bicycle.
Uber Chief Executive Dara
Khosrowshahi in an interview
said the deal risks cannibalizing some shorter trips that
customers would otherwise
take in pricier Uber cars, but
said it is important for the
company to capitalize on all
the ways people navigate a
city.
“This represents the natural
evolution of Uber from the carsharing app,” he said. Uber
had considered attempting to
reproduce Jump’s bikes on its
own but ultimately decided an
acquisition was best, he said.
It is Mr. Khosrowshahi’s
first acquisition since starting
EMILY PRAPUOLENIS/THE WALL STREET JOURNAL
Check Your
IPhone
Battery’s
Health
Apple Goes All Green Everywhere
THOMAS PETER/REUTERS
PERSONAL
TECHNOLOGY
By David Pierce
The purchase of Jump Bikes will give Uber access to customers in Washington and San Francisco.
as Uber CEO in September. Before Uber, he oversaw several
major deals as Expedia Group
Inc.’s CEO, including $3.9 billion for HomeAway and $1.3
billion for Orbitz. TechCrunch
reported Uber was hoping to
acquire Jump for around $100
million.
Jump, based in New York,
has raised about $12 million
including from Uber investor
Menlo Ventures. Its bikes are
made in China for about
$1,000 each.
Jump CEO Ryan Rzepecki,
who will report to Mr. Khosrowshahi, said Jump’s roughly
100 employees are expected to
keep their jobs after the deal
closes. “This will help us be
more efficient as we scale,” he
said, speaking about the sale.
It would have taken “multiple
rounds of funding” to approach the amount Uber offered.
.
THE WALL STREET JOURNAL.
NY
Tuesday, April 10, 2018 | B6A
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BUSINESS & TECHNOLOGY
Tech Puts Fast Fashion on Steroids
‘Click, buy and make’
model enables speedy
delivery of custommade clothes, shoes
BY ALBERTO DELCLAUX
BY NATASHA KHAN
Novartis AG agreed to buy
U.S.-based gene-therapy company AveXis Inc. for $8.7 billion, marking the first big bet
by the Swiss pharmaceutical
giant’s new chief as he looks
to the deal table to refresh
his drug-development pipeline.
Novartis said Monday it
would pay $218 for each share
of Illinois-based AveXis, an
88% premium to its closing
price on Friday.
Earlier this year, Novartis
Chief
Executive
Vasant
Narasimhan agreed to cash out
of the company’s consumerhealth joint venture with
GlaxoSmithKline PLC—a deal
that gives him cash for what
he describes as “bolt-on” deals
to replenish Novartis’s drug
pipeline, his key focus since
taking the reins this year.
That transaction gives Novartis the cash to be more
flexible acquiring promising
outside
medicines.
Dr.
Narasimhan has pledged to refocus Novartis on drug development.
In a conference call Monday,
Dr. Narasimhan said the
AveXis deal would be partly
funded by the GlaxoSmithKline
joint-venture sale.
The deal is a bet that at
least one promising drug that
AveXis is developing for thera-
HONG KONG—Style trends
are moving faster than ever in
an age when a shopper can
spot an outfit on Instagram
and buy it with just a few
clicks. That immediacy is
prompting some in the fashion
industry to experiment with a
business model some are calling “click, buy and make.”
Former stockbroker Sarah
Chessis, a Hong Kong entrepreneur, has co-developed
software called Bespokify that
customers anywhere in the
world can use to order her bespoke professional women’s
clothing. Customers input
their measurements, generating a digital pattern for
clothes manufactured in
China, and receive their orders
within two weeks of purchase.
Ms. Chessis’ brand, Isabella
Wren, features customizable
dresses that can cost as much
as $500. Ms. Chessis said she
is working on a more basic
line with less expensive fabrics and fewer customized features that would cost about
40% less.
“Consumers are now shopping 24 hours a day and are
being trained to expect new
styles all the time,” says Mariana Kou, consumer analyst for
the bank CLSA.
Big retailers also are looking into the “click, buy and
make” model. A year ago, Amazon.com Inc. won a patent
with which it could take a customer’s order, print a pattern
on fabric and send it to be cut
by a robot before being assembled by another robot. The
company, which frequently
pies aimed at spinal muscular
atrophy will translate into a
blockbuster. AveXis is a genetherapy company conducting
several clinical studies for the
treatment of spinal muscular
atrophy or SMA, an inherited
neurodegenerative
disease
caused by a defect in a single
gene, Novartis said. Some form
of SMA affects an estimated
one out of every 6,000 to
10,000 children born, it said.
It is also a further endorsement of gene therapy, a
treatment type Novartis has
already spearheaded for cancer.
“We would gain with the
team at AveXis another genetherapy platform, in addition
to our CAR-T platform for cancer, to advance a growing
pipeline of gene therapies
across therapeutic areas,” said
Dr. Narasimhan.
Novartis last year launched
a first-of-its kind cancer therapy, known as CAR-T treatment, which involves extracting a patient’s disease-fighting
blood cells, modifying them to
attack cancer cells more vigorously and then reinjecting
them in the patient.
AveXis’s gene-therapy candidate AVXS-101 has the potential to be the first one-time
gene-replacement therapy for
SMA, according to Novartis
officials.
Dr. Narasimhan said on the
conference call that the drug
promised multibillion-dollar
sales potential. AveXis expects
to file in the second half of
this year for approval from
U.S. regulators, with a launch
expected in 2019.
“The price tag is higher
than what Novartis previously
has called bolt-on acquisitions,
but if AVXS-101 trumps other
SMA agents, we believe there
is some sense to this,” said
UBS analyst Michael Leuchten.
The first treatment for the disease, Ionis Pharmaceuticals
Inc.’s Spinraza, won approval a
year ago.
The payoff isn’t a sure
thing. Even drugs that are
showing promise in late-stage
trials can stumble, failing to
live up to sales forecasts.
Novartis said it expects the
deal to slightly hit core operating income in 2018 and 2019,
due to R&D investments. It
said the acquisition should
strongly benefit core operating
income and core earnings a
share as of 2020, however,
driven by an increase in sales.
Novartis said it expects the
deal to close by the middle of
the year.
—Noemie Bisserbe
contributed to this article.
Sarah Chessis, right, who co-developed software for customizing clothing, at her fashion brand’s production workshop in China.
files for patents, not all of
them resulting in new business developments, hasn’t announced plans to implement
the technology. Amazon declined to comment.
Spencer Fung, who runs
Hong Kong’s Li & Fung Ltd.,
one of the largest supply-chain
managers in the global garment industry, said new technologies could ultimately
mean that more companies
would be able to place small
orders and avoid being stuck
with extra inventory.
“Just look at the average
size of orders—it’s been going
down for years,” Mr. Fung said.
“It went from hundreds of
thousands to tens of thousands.
And it will keep going down until it approaches a unit of one.”
For now, the problem is
cost: Automation in the apparel industry still struggles
to handle fabrics and certain
soft materials. “It’s still hard
to make a single piece at
scale,” Mr. Fung said. “Nobody
has come up with the right
business model yet.”
Software and robotics have
been in use in fashion for
some years. Companies like
Proper Cloth in the U.S. use
technology to predict a customer’s ideal shirt measurements without having to measure someone in person,
according to Chief Executive
Seph Skerritt. For men’s
shirts, he said, one of the challenges of fully automating robotic cutting is maintaining
perfect alignment of the
shapes to be cut with the
stripes or other pattern im-
printed on the fabric.
Tailored women’s clothes
are notoriously ill-fitting, and
Ms. Chessis said it took hundreds of iterations to hone an
algorithm that produces clothes
that she says are close to a perfect fit every time, provided
measurement data are accurate.
Isabella Wren’s software allows clients to generate customized patterns not only for
dresses, but also for jackets,
blouses and trousers.
Isabella Wren clothes currently are handmade, which
adds to the cost. Ms. Chessis
says she is developing lasercutting technology to replace
human tailors at her workshop.
The bespoke model is creating opportunities for new
types of factories, such as that
of Jodie Fox’s customized shoe
business, Shoes of Prey.
In the past, Ms. Fox would
fly to Hong Kong from Sydney
to visit cobblers to make her
shoe designs, a process that
could take weeks. When she
wanted to turn her passion into
a business, she couldn’t find
factories that would make just
one pair of shoes: On average
they wanted 1,000 pairs per order, and two to five months to
make and deliver them.
Aiming to re-engineer the
manufacturing process for her
business, Ms. Fox created her
own factory in the Chinese
city of Dongguan, and around
2012 she began investing in
technology including software
that can print shoe-assembly
instructions for workers on
the factory floor as soon as a
customer clicks “buy.”
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The purchase is a bet
that at least one of
AveXis’s drugs will
become a blockbuster.
THEODORE KAYE FOR THE WALL STREET JOURNAL
Novartis
Deal to
Help Drug
Pipeline
Lucy Peng remains one of China’s wealthiest businesswomen.
Chairman Exits at
Alibaba Affiliate Ant
BY CHUIN-WEI YAP
AND JULIE STEINBERG
Lucy Peng, one of China’s
richest businesswomen, has
left the helm of one of the
country’s most valuable private companies.
Ms. Peng, 46 years old,
stepped down as executive
chairman of Ant Financial
Services Group, the financialtechnology affiliate of Alibaba
Group Holding Ltd. that she
led for eight years.
She is succeeded by Eric
Jing, Ant’s chief executive officer, who is taking on the additional chairman’s role with immediate effect, Ant said
Monday. Mr. Jing, 45, has been
CEO since October 2016, when
he took over the job from Ms.
Peng.
Ant said Ms. Peng will focus
on running Lazada Group, an
operator of online retail marketplaces in Southeast Asia
that Alibaba is using as a
beachhead to expand in the region. Ant said Lazada’s growth
is a key part of Alibaba’s
global strategy.
Ms. Peng, who also is one of
Alibaba’s co-founders, was
named CEO of Singaporebased Lazada in March after
Alibaba invested $2 billion in
it, adding to an earlier multibillion-dollar investment. She
is also chairman of the company, in which Alibaba took a
controlling stake in 2016.
Ms. Peng, who is famously
media-shy, has been a confidante of billionaire founder
Jack Ma. Mr. Ma, in an internal
email Monday, said that when
Ms. Peng took the post of executive chairman of Lazada,
“Lucy told me the time had
come for Eric to take on even
more responsibility and for her
to step away and give Ant’s
leadership team the space to
grow even faster.”
Ant’s management change
comes as the company is raising as much as $5 billion from
private investors, according to
people familiar with the matter. The effort is widely seen
as a prelude to an initial public
offering of Ant, though there is
no certainty the company will
proceed with a listing in the
near term. A spokesman for
Ant declined to comment.
Hangzhou-based Ant’s last
announced fundraising round
was in April 2016, when the
company secured $4.5 billion
from Chinese investors and
earned a valuation of about
$60 billion. Since then, the
company has increased revenue, expanded its Alipay mobile-payments network, entered new markets and
widened its scope of financial
services for individuals and
small businesses. It also has an
asset-management business
that oversees the world’s largest money-market fund by assets.
Ant’s current fundraising effort includes domestic and foreign investors, who have subscribed to at least $3 billion of
its shares, a person familiar
with the matter said. Some
market participants expect the
latest share sale to give Ant a
valuation near $100 billion.
Ms. Peng ran Alipay from
2010 to 2014, a period that
spanned the business getting
carved out from Alibaba and
its rebranding as Ant. She
went on to lead Ant as its CEO
until 2016. Ms. Peng became a
billionaire after Alibaba’s 2014
initial public offering.
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.
THE WALL STREET JOURNAL.
B8 | Tuesday, April 10, 2018
May 22, 2018
|
Four Seasons Hotel
|
Washington, D.C.
How innovation is revolutionizing
the business of health
This spring, the editors of The Wall Street Journal will convene experts from across the health and health-care
industries to focus on the innovations transforming this critical sector.
SPEAKERS
Scott Gottlieb, M.D.
Commissioner,
U.S. Food and Drug Administration
Rear Adm. Anne Schuchat,
M.D.
Acting Director,
Centers for Disease Control
and Prevention
Steven H. Collis
Gail K. Boudreaux
Chairman, President and CEO,
AmerisourceBergen Corporation
President and CEO,
Anthem, Inc.
Mark T. Bertolini
Alex Gorsky
Chairman and CEO,
Aetna Inc.
Chairman and CEO,
Johnson & Johnson
David A. Ricks
Mary E. Klotman, M.D.
Chairman and CEO,
Eli Lilly and Company
Dean, School of Medicine and Vice
Chancellor for Health Affairs,
Duke University
Michael A. Mussallem
Steven J. Corwin, M.D.
Chairman and CEO,
Edwards Lifesciences
President and CEO,
NewYork-Presbyterian
Anthony S. Fauci, M.D.
Regina M. Benjamin, M.D.
Director, National Institute of
Allergy and Infectious Diseases,
The National Institutes of Health
Founder and CEO,
BayouClinic, Inc.
Peter B. Bach, M.D.
Alexis Borisy
Director, Center for Health Policy
and Outcomes and Faculty Member,
Department of Epidemiology and
Biostatistics,
Memorial Sloan Kettering Cancer Center
Partner,
Third Rock Ventures
Surgeon General of the United
States (20092013)
George M. Church, Ph.D.
Stephanie Domas, P.E.,C.E.H.
Professor of Genetics,
Harvard Medical School
Vice President of Research,
MedSec
Director,
PersonalGenomes.org
Thomas McLellan, Ph.D.
David N. Osser, M.D.
Co-Founder and Scientiic Director
(19922015),
Treatment Research Institute
Associate Professor of Psychiatry,
Harvard Medical School
Deputy Director and Senior Scientist
(20092011), White House Ofice of
National Drug Control Policy
Attending Psychiatrist, Domiciliary
Treatment Program for Homeless Veterans,
Veterans Affairs Boston Healthcare System
Eric Topol, M.D.
Sarah E. Wakeman, M.D.
Founder and Director,
Scripps Translational
Science Institute, Professor
of Molecular Medicine and
Executive Vice President,
The Scripps Research Institute
Medical Director, Substance
Use Disorders Initiative,
Massachusetts General Hospital
Feng Zhang, Ph.D.
Daphne Zohar
Core Institute Member,
Broad Institute of MIT
and Harvard
Co-Founder and CEO,
PureTech Health plc.
Assistant Professor of Medicine,
Harvard Medical School
PROUDLY SPONSORED BY:
Request your invitation: healthforum.wsj.com
© 2018 Dow Jones & Co., Inc. All rights reserved. 6DJ6393
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | B9
MARKETS DIGEST
EQUITIES
S&P 500 Index
Dow Jones Industrial Average
Last Year ago
23979.10 s 46.34, or 0.19%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio 25.33 21.07
P/E estimate *
16.34 17.70
Dividend yield
2.21
2.36
All-time high 26616.71, 01/26/18
Current divisor 0.14523396877348
Nasdaq Composite Index
Last
2613.16 s 8.69, or 0.33%
High, low, open and close for each
trading day of the past three months.
Year ago
Trailing P/E ratio * 25.04 24.63
P/E estimate *
16.88 18.32
Dividend yield
1.96
1.97
All-time high 2872.87, 01/26/18
Last Year ago
6950.34 s 35.23, or 0.51%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio * 25.33
26.11
P/E estimate *
19.68
20.35
Dividend yield
1.06
1.10
All-time high: 7588.32, 03/12/18
Session high
t
DOWN
Session open
t
Close
2900
7500
2825
7300
25200
2750
7100
24400
2675
23600
2600
22800
2525
26800
UP
Close
Open
26000
65-day moving average
Session low
6900
65-day moving average
6700
65-day moving average
6500
Bars measure the point change from session's open
Feb.
Mar.
6300
2450
22000
Jan.
Jan.
Apr.
Feb.
Mar.
Jan.
Apr.
Feb.
Mar.
Apr.
*Weekly P/E data based on as-reported earnings from Birinyi Associates Inc.
Major U.S. Stock-Market Indexes
High
Latest
Close
Low
Net chg
% chg
High
52-Week
Low
% chg
% chg
YTD 3-yr. ann.
Dow Jones
24373.18 23954.83 23979.10
Industrial Average
0.19
46.34
-0.27
Transportation Avg 10260.16 10107.35 10119.36 -27.01
692.29
0.70
0.10
27490.45 27062.90 27084.39
709.53
699.18
699.48
73.10
-1.43
0.27
697.21
Utility Average
Total Stock Market
Barron's 400
689.29
Nasdaq Stock Market
Nasdaq Composite
7074.95
Nasdaq 100
6604.26
6944.96
6466.04
6950.34
6472.34
-0.20
0.51
35.23
39.13
0.61
26616.71 20404.49
16.1
-3.0
11373.38
8783.74
10.2
-4.6
5.1
774.47
647.90
-1.2
-4.3
5.7
29630.47 24125.20
757.37
610.89
10.9
12.9
-2.1
-1.6
7.3
6.6
7588.32
7131.12
5805.15
5353.59
10.1
0.7
1.2
18.2
19.4
11.8
13.7
S&P
500 Index
2653.55
2610.79
2613.16
8.69
0.33
2872.87
2328.95
10.9
-2.3
7.7
MidCap 400
SmallCap 600
1879.09
943.94
1853.61
931.67
1854.53
931.83
0.45
-2.46
0.02
1995.23
979.57
1681.04
815.62
8.4
12.3
-2.4
-0.5
6.6
9.0
Other Indexes
Russell 2000
1533.94
1513.90
1514.46
1.17
0.08
1610.71
1345.24
10.8
-1.4
6.3
12532.85 12374.92 12380.55
31.44
0.25
13637.02 11324.53
8.0
-3.3
3.8
-3.6
NYSE Composite
548.38
541.61
NYSE Arca Biotech
4535.03
4278.48
NYSE Arca Pharma
534.54
523.74
528.41
KBW Bank
Value Line
541.80
-0.26
-0.08
-0.42
4490.00 232.16
Company
Volume
(000)
Symbol
Net chg
11,456.6 260.80
After Hours
% chg
High
-0.20
Low
-0.08 264.40 260.49
SPDR S&P 500
SPY
Intel
INTC
5,338.1
49.60
0.05
0.10
50.12
49.55
General Electric
GE
4,573.9
12.81
-0.02
-0.16
12.95
12.80
4,369.6
21.98
…
unch.
22.03
21.98
4,338.9
3.35
0.01
0.30
3.35
3.34
Brookdale Senior Living BKD
3,817.9
6.67
…
unch.
6.67
6.67
Verizon Communications VZ
3,155.1
46.92
…
unch.
48.89
46.85
Platform Specialty
2,761.6
9.42
…
unch.
9.42
9.42
VanEck Vectors Gold Miner GDX
LC
LendingClub
PAH
Percentage gainers…
AVEO Pharmaceuticals AVEO
55.7
2.68
0.18
7.20
2.68
2.50
Sangamo Therapeutics SGMO
53.9
18.50
0.70
3.93
18.50
17.80
99.0
57.51
1.22
2.17
57.94
56.27
1,272.4 191.78
4.01
2.14 191.78 187.40
Seagate Technology
STX
S&P Global
SPGI
VS 2x VIX Short Term
TVIX
999.4
10.61
0.22
2.12
10.66
10.28
27.00
29.7
6.3
3.7
498.46
4.5
-3.0
-3.2
...And losers
Five9
FIVN
75.4
27.00
-0.68
-2.46
27.68
Denbury Resources
DNR
67.3
2.78
-0.06
-2.11
2.86
2.78
0.72
105.84
0.76
116.52
88.02
17.2
-0.8
13.3
80.31
-0.49
-0.60
93.26
76.42
-6.5
-5.0
PHLX§ Oil Service
81.05
6.2
137.91
136.11
136.31
-0.12
-0.09
171.55
117.79
-20.5
1310.33
22.02
1272.91
20.34
1273.80
21.77
8.54
0.28
1445.90
37.32
960.01
9.14
28.5
54.9
0.68
1.30
-8.9 -13.1
Alliance Resource Ptrs ARLP
72.2
16.25
-0.35
-2.11
16.60
16.25
1.7
97.2
Take-Two Interactive
TTWO
59.3
95.00
-1.51
-1.56
97.00
94.00
Incyte
INCY
52.4
64.54
-0.82
-1.25
65.52
64.54
21.7
18.5
Sources: SIX Financial Information; WSJ Market Data Group
International Stock Indexes
Region/Country Index
Close
Percentage Gainers...
Net chg
Latest
% chg
YTD
% chg
9.91
1.33
1.06
0.33
0.34
0.40
–2.5
–1.6
–1.0
Americas
Brazil
Canada
Mexico
Chile
DJ Americas
627.54
1.62
Sao Paulo Bovespa 83307.23 –1513.19
S&P/TSX Comp
15227.70
20.29
S&P/BMV IPC
48058.96
132.85
Santiago IPSA
4212.24
8.20
0.26
–2.3
9.0
–6.1
–2.6
0.03
EMEA
Eurozone
Belgium
Denmark
France
Germany
Israel
Italy
Netherlands
Russia
South Africa
Spain
Sweden
Switzerland
Turkey
U.K.
U.K.
Stoxx Europe 600
Euro Stoxx
Bel-20
OMX Copenhagen
CAC 40
DAX
Tel Aviv
FTSE MIB
AEX
RTS Index
FTSE/JSE All-Share
IBEX 35
OMX Stockholm
Swiss Market
BIST 100
FTSE 100
FTSE 250
3010.50
390.85
263.97
The Global Dow
DJ Global Index
DJ Global ex U.S.
–1.78
375.30
0.48
379.01
0.77
3870.65
0.58
889.87
4.74
5263.39
5.15
12261.75
20.48
1418.91
1.98
23053.99
124.12
539.90
0.61
1094.98 –141.50 –11.44
56091.56
212.75
9742.80
60.00
–0.07
553.34
–0.36
8687.08
16.04
113156.08 –1581.46
–1.38
7194.75
11.11
–0.23
19484.35
–45.82
S&P/ASX 200
5808.70
Shanghai Composite 3138.29
Hang Seng
30229.58
S&P BSE Sensex
33788.54
Nikkei Stock Avg
21678.26
Straits Times
3449.96
Kospi
2444.08
TAIEX
10893.53
SET
1751.27
20.00
7.18
384.64
161.57
110.74
7.46
14.50
72.00
11.35
0.13
0.28
0.20
0.13
0.20
0.01
0.54
0.10
0.17
0.14
0.54
0.11
0.38
0.62
0.18
0.15
0.35
0.23
1.29
0.48
0.51
0.22
0.60
0.67
0.65
–3.6
–1.7
–2.7
–4.0
–0.9
–5.1
–6.0
5.5
–0.9
–5.1
–5.7
–3.0
–2.7
–7.4
–1.9
–6.4
–6.0
–4.2
–5.1
1.0
–0.8
–4.8
1.4
–0.9
2.4
–0.1
Sources: SIX Financial Information; WSJ Market Data Group
Company
Symbol
AveXis
Direxion Russia Bear 3x
Turtle Beach
Nemaura Medical
Red Violet
AVXS
Abeona Therapeutics
uniQure
Empire Resorts
REGENXBIO
Therapix Biosciences ADR
ABEO
Kingtone Wirelessinfo ADR
Broadvision
Audentes Therapeutics
Novus Therapeutics
Spark Therapeutics
KONE
Latest Session
Close Net chg % chg
High
52-Week
Low
% chg
U.S. consumer rates
Selected rates
A consumer rate against its
benchmark over the past year
30-year mortgage, Rate
211.75 65.23
44.39 14.43
...
...
9.60 2.00
46.40 5.05
207.7
-30.5
0.3
80.1
...
Menlo Therapeutics
Direxion Russia Bull 3x
China Internet Nationwide
ACADIA Pharmaceuticals
NMI Holdings Cl A
MNLO
16.55
25.57
23.90
31.45
6.01
2.55
3.61
3.30
4.25
0.81
18.21
16.44
16.02
15.63
15.58
22.75 4.55
27.19 4.72
30.98 15.88
42.00 16.30
8.18 4.26
231.0
349.4
-1.4
83.9
-23.4
Mechel ADR
Marrone Bio Innovations
VEON ADR
MGIC Investment
OncoSec Medical
MTL
5.12
2.65
32.26
5.47
70.36
0.68
0.35
4.15
0.69
8.30
15.32
15.22
14.76
14.44
13.37
9.40 2.63
4.65 2.30
41.80 13.90
6.60 3.12
91.75 41.06
31.3
-39.1
101.0
-12.5
40.2
Radian Group
Essent Group
Netshoes (Cayman)
Intersections
Mobile TeleSystems ADR
RDN
NYNY
RGNX
TRPX
BVSN
BOLD
NVUS
ONCE
Most Active Stocks
Company
Symbol
Neovasc
SPDR S&P 500
Bank of America
General Electric
iShares MSCI Emg Markets
NVCN
Finl Select Sector SPDR
Micron Technology
PwrShrs QQQ Tr Series 1
VS 2x VIX Short Term
Advanced Micro Devices
XLF
SPY
BAC
GE
EEM
MU
QQQ
TVIX
AMD
Volume % chg from Latest Session
(000) 65-day avg Close % chg
52-Week
High
Low
t
10-year Treasury
note yield
2.00
Carolina Equity Services, Inc.
4.25%
Apex, NC
919-467-6192
1.00
Hills Bank and Trust Company
4.25%
Hills, IA
800-445-5725
0.00
M J J A S O ND J FMA
2017
2018
Family Federal Savings
Fitchburg, MA
Yield/Rate (%)
Last (l)Week ago
Federal-funds rate target
1.50-1.75 1.50-1.75
Prime rate*
4.75
4.75
Libor, 3-month
2.31
2.34
Money market, annual yield
0.35
0.35
Five-year CD, annual yield
1.66
1.68
30-year mortgage, fixed†
4.39
4.40
15-year mortgage, fixed†
3.85
3.85
Jumbo mortgages, $424,100-plus† 4.68
4.67
Five-year adj mortgage (ARM)† 4.21
4.14
New-car loan, 48-month
3.67
3.73
4.38%
978-353-0000
3-yr chg
52-Week Range (%)
Low 0 2 4 6 8 High (pct pts)
0.75 l
l
4.00
l
1.15
0.25 l
l
1.29
l
3.73
l
2.99
l
4.21
l
3.20
l
2.85
1.50
4.75
2.34
0.36
1.68
4.49
3.95
4.96
4.50
3.73
1.50
1.50
2.06
-0.07
0.19
0.61
0.79
0.61
0.96
0.78
Bankrate.com rates based on survey of over 4,800 online banks. *Base rate posted by 70% of the nation's largest
banks.† Excludes closing costs.
Sources: SIX Financial Information; WSJ Market Data Group; Bankrate.com
One year ago
1
3 6
month(s)
1 2 3 5 710
years
maturity
MTG
ONCS
ESNT
NETS
INTX
MBT
3.37
2.62
2.20
10.62
1.73
-0.89
-0.63
-0.48
-2.20
-0.34
-20.89
-19.38
-17.91
-17.16
-16.26
6.23 3.35
3.39 0.85
4.47 2.20
16.21 10.10
2.95 0.88
-37.9
42.4
-43.2
2.3
40.2
16.11
35.61
4.95
1.95
9.62
-3.03
-6.46
-0.75
-0.29
-1.38
-15.83
-15.36
-13.16
-12.95
-12.55
23.49 15.58
50.08 34.08
26.96 4.59
5.75 1.46
12.80 7.77
-11.1
-4.0
...
-51.3
-10.6
Ranked by change from 65-day average*
Volume % chg from Latest Session
(000) 65-day avg Close % chg
-17.7
-8.1
-21.8
-11.8
-41.7
27.32 0.55
47.96 -1.03
157.73 0.70
10.39 0.48
9.53 -0.83
30.33 22.89
63.42 26.36
175.21 130.38
47.19
4.66
15.65
9.04
GS Access Inv Grade Cp Bd GIGB
FlexShares Core Sel Bd Fd BNDC
RUSL
Direxion Russia Bull 3x
VanEck Vectors Gaming ETF BJK
WT Interest Rt Hdg HY Bd HYZD
515
120
2,083
156
1,290
1.50
0
0.75
–5
0.00
–10
8.18
33.00
211.75
26.38
70.78
4.26
26.37
65.23
25.82
55.07
48.69 0.11
24.55 0.40
37.45 -31.95
45.55 1.61
24.00 0.38
50.44
28.51
73.38
50.18
26.52
48.16
24.28
29.06
37.96
22.99
Currencies
U.S.-dollar foreign-exchange rates in late New York trading
15%
5
1583
1438
1404
1200
1153
15.58
1.07
81.57
0.04
1.97
CURRENCIES & COMMODITIES
Yen, euro vs. dollar; dollar vs.
major U.S. trading partners
2.25
6.01
20296
10359 31.18
2411 210.46
2266 25.88
1832 65.86
52-Week
High
Low
* Common stocks priced at $2 a share or more with an average volume over 65 trading days of at least
5,000 shares =Has traded fewer than 65 days
Forex Race
10
Euro
US$vs,
YTDchg
Mon
in US$ per US$ (%)
Yen
Vietnam dong
Argentina peso
.0495 20.1900 8.5
Brazil real
.2922 3.4222 3.3
Canada dollar
.7875 1.2699 1.0
Chile peso
.001655 604.30 –1.8
Ecuador US dollar
1
1 unch
Mexico peso
.0545 18.3514 –6.7
Uruguay peso
.03552 28.1500 –2.3
Venezuela b. fuerte .00002050920.0001 492268.4
Europe
s
WSJ Dollar index
2017
2018
Corporate Borrowing Rates and Yields
Yield (%)
Last Week ago
52-Week
High
Low
Total Return (%)
52-wk
3-yr
2.639
2.786
3.686
3.140
5.979
3.310
2.544
2.588
2.732
3.694
3.110
6.104
3.300
2.497
2.736
2.943
3.814
3.230
6.319
3.410
2.544
1.818 –0.050 0.268
2.058 –1.497 –0.529
2.879 2.114 2.116
2.380 0.987 1.174
4.948 2.731 3.319
2.660 0.610 1.099
1.736 1.509 1.781
6.004
6.016
6.104
5.279
3.102 4.885
Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch
Australian dollar
.7696 1.2994
China yuan
.1586 6.3053
Hong Kong dollar
.1274 7.8493
India rupee
.01541 64.875
Indonesia rupiah .0000726 13774
Japan yen
.009365 106.78
Kazakhstan tenge .003117 320.81
Macau pataca
.1237 8.0848
Malaysia ringgit
.2583 3.8715
New Zealand dollar
.7305 1.3689
Pakistan rupee
.00864 115.699
Philippines peso
.0192 51.999
Singapore dollar
.7625 1.3115
South Korea won .0009349 1069.69
Sri Lanka rupee
.0064541 154.94
Taiwan dollar
.03418 29.255
Thailand baht
.03199 31.260
Commodities
1.5
–3.0
0.5
1.6
2.2
–5.3
–3.6
0.5
–4.7
–2.9
4.6
4.1
–1.9
0.2
0.9
–1.4
–4.1
US$vs,
YTDchg
Mon
in US$ per US$ (%)
Country/currency
Americas
Asia-Pacific
30
Treasury, Ryan ALM
1437.761
10-yr Treasury, Ryan ALM 1684.203
DJ Corporate
373.428
Aggregate, Barclays Capital 1915.430
High Yield 100, Merrill Lynch 2840.782
Fixed-Rate MBS, Barclays 1964.730
Muni Master, Merrill
515.781
EMBI Global, J.P. Morgan
794.692
VEON
...
-9.1
...
-50.1
12.3
53,407
49,699
39,099
38,040
37,532
3.00
Close
MBII
7.94
29.06
10.81
15.74
10.10
6,104
587
12,706
295
144
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group
Bond total return index
NMIH
39.86
73.38
66.10
41.20
21.92
Therapix Biosciences ADR TRPX
PowerShares DWA Mom LowDWLV
AVXS
AveXis
iSh iBonds Mar 2020 Corp IBDC
JPXN
iSh JPX-Nikkei 400
3.75%
Garden State Home Loans
4.13%
Cherry Hill, NJ
609-216-7912
ACAD
8.17 -27.05 -76.80
37.45 -17.58 -31.95
21.06 -8.14 -27.88
16.50 -5.03 -23.36
13.70 -4.00 -22.60
1.89
0.03
286.63 232.51
33.05 22.07
30.54 12.73
52.08 38.71
notes and bonds
t
t
3.00
CIFS
Symbol
Country/currency
t
* Primary market NYSE, NYSE American NYSE Arca only.
†(TRIN) A comparison of the number of advancing and declining
issues with the volume of shares rising and falling. An
Arms of less than 1 indicates buying demand; above 1
indicates selling pressure.
52-Week
Low
% chg
0.06 6.22
261.00 0.49
29.87 0.81
12.83 -1.76
47.13 0.11
Compare the performance of selected
global stock indexes, bond ETFs,
currencies and commodities at
WSJ.com/TrackTheMarkets
Monday
NYSE Arca
High
748.6
-22.6
-15.0
-31.5
-28.0
s
30-year fixed-rate
mortgage
Company
Track the Markets
3.88%
800-922-8429
Nasdaq
Total volume*2,053,010,550 263,482,939
Adv. volume*1,319,310,860 177,541,452
Decl. volume* 682,836,948 85,022,146
Issues traded
3,038
1,271
Advances
1,517
896
Declines
1,341
355
Unchanged
180
20
New highs
27
6
New lows
56
6
Closing tick
135
146
Closing Arms†
0.59
1.09
Block trades*
11,952
1,338
Latest Session
Close Net chg % chg
315,141
93,641
64,232
63,724
54,239
s
4.00%
Cathay Bank
Los Angeles, CA
RUSL
Volume Movers
* Volumes of 100,000 shares or more are rounded to the nearest thousand
4.40%
Bankrate.com avg†:
Symbol
81.57
32.03
28.52
23.37
20.69
Benchmark
Yields
Treasury yield
curve
andtoRates
Yield
maturity of current bills,
Consumer Rates and Returns to Investor
Company
210.46 94.55
23.70 5.75
HEAR
3.29 0.73
NMRD
4.25 0.81
RDVT
9.51 1.63
RUSS
QURE
Total volume* 797,493,206 8,842,165
Adv. volume* 380,939,937 5,817,802
Decl. volume* 390,953,170 2,545,922
Issues traded
3,063
329
Advances
1,408
169
Declines
1,516
132
Unchanged
139
28
New highs
23
2
New lows
53
3
Closing tick
77
9
Closing Arms†
0.95
0.60
Block trades*
5,870
107
Percentage Losers
CREDIT MARKETS
Interest rate
Last
3452.82
593.12
105.53
Asia-Pacific
Australia
China
Hong Kong
India
Japan
Singapore
South Korea
Taiwan
Thailand
Most-active issues in late trading
5.45 4939.86
1.5
81.69
World
NYSE NYSE Amer.
4.8
108.21
Nasdaq PHLX
Volume, Advancers, Decliners
503.24
PHLX§ Gold/Silver
PHLX§ Semiconductor
Cboe Volatility
Trading Diary
Most-active and biggest movers among NYSE, NYSE Arca, NYSE Amer.
and Nasdaq issues from 4 p.m. to 6:30 p.m. ET as reported by electronic
trading services, securities dealers and regional exchanges. Minimum
share price of $2 and minimum after-hours volume of 50,000 shares.
589.69
1.26
6.56
Late Trading
.00004387
Czech Rep. koruna
Denmark krone
Euro area euro
Hungary forint
Iceland krona
Norway krone
Poland zloty
Russia ruble
Sweden krona
Switzerland franc
Turkey lira
Ukraine hryvnia
UK pound
22793
0.4
.04860 20.575
.1654 6.0442
1.2323 .8115
.003956 252.76
.010158 98.44
.1284 7.7854
.2938 3.4040
.01650 60.605
.1196 8.3581
1.0459 .9561
.2455 4.0736
.0384 26.0105
1.4130 .7077
–3.3
–2.6
–2.6
–2.4
–4.9
–5.1
–2.2
5.1
2.1
–1.9
7.3
–7.6
–4.4
Middle East/Africa
Bahrain dinar
Egypt pound
Israel shekel
Kuwait dinar
Oman sul rial
Qatar rial
Saudi Arabia riyal
South Africa rand
2.6529 .3769 –0.04
.0566 17.6810 –0.5
.2840 3.5214 1.2
3.3331 .3000 –0.5
2.5974 .3850 0.01
.2747 3.640 –0.2
.2666 3.7503
...
.0827 12.0928 –2.2
Close Net Chg % Chg YTD%Chg
WSJ Dollar Index 83.83 –0.15–0.18 –2.49
Sources: Tullett Prebon, WSJ Market Data Group
Monday
52-Week
Pricing trends on someClose
raw materials,
or commodities
Net chg % Chg
High
Low
DJ Commodity
TR/CC CRB Index
Crude oil, $ per barrel
Natural gas, $/MMBtu
Gold, $ per troy oz.
635.58
9.15
194.97
63.42
2.693
1336.30
2.72
1.36
-0.008
4.40
1.46
% Chg
YTD
% chg
645.87
532.01
11.13
1.63
1.41 200.52
66.14
2.19
3.63
-0.30
0.33 1362.40
166.50
42.53
2.55
1208.60
3.91
19.48
-16.83
6.81
0.57
4.97
-8.80
2.30
Get real-time U.S. stock quotes and track most-active stocks, new highs/lows and mutual funds. Plus, deeper money-flows data and email delivery of key stock-market data. Available free at WSJMarkets.com
.
THE WALL STREET JOURNAL.
B10 | Tuesday, April 10, 2018
COMMODITIES
Futures Contracts
Contract
High hilo
Low
Open
Metal & Petroleum Futures
Contract
Open
High hi lo
Low
Settle
Chg
Copper-High (CMX)-25,000 lbs.; $ per lb.
3.0610
3.0720
3.0605
3.0715 0.0175
April
May
3.0425
3.0855
3.0355
3.0770 0.0185
Gold (CMX)-100 troy oz.; $ per troy oz.
April
1333.00 1337.50
1327.00 1336.30
4.40
June
1338.00 1341.50
1330.10 1340.10
4.00
Aug
1343.20 1347.10
1336.60 1346.20
3.90
Oct
1348.00 1353.20
1342.90 1352.30
3.80
Dec
1355.90 1360.00
1349.30 1358.90
3.90
Dec'19
...
...
... 1398.50
3.70
Palladium (NYM) - 50 troy oz.; $ per troy oz.
899.60
934.00
895.85
932.50 37.35
June
Sept
899.90
930.00
899.90
928.85 36.55
Platinum (NYM)-50 troy oz.; $ per troy oz.
921.40
921.40
917.30
936.00 21.90
May
July
921.00
940.50
920.00
939.40 21.90
Silver (CMX)-5,000 troy oz.; $ per troy oz.
16.345
16.490
16.345
16.499 0.167
April
May
16.420
16.540
16.295
16.529 0.167
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl.
62.02
63.61
61.93
63.42
1.36
May
June
62.08
63.62
62.01
63.43
1.33
July
61.94
63.44
61.88
63.26
1.30
Sept
61.26
62.66
61.26
62.50
1.24
Dec
60.18
61.45
60.18
61.29
1.15
Dec'19
56.26
56.99
56.25
56.84
0.70
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal.
1.9570
2.0034
1.9537
1.9966 .0388
May
June
1.9535
1.9975
1.9517
1.9904 .0360
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal.
1.9504
1.9908
1.9500
1.9842 .0295
May
June
1.9554
1.9936
1.9544
1.9871 .0286
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu.
2.687
2.704
2.640
2.693 –.008
May
June
2.733
2.741
2.684
2.731 –.016
July
2.791
2.797
2.742
2.780 –.024
Sept
2.803
2.808
2.759
2.794 –.022
Oct
2.816
2.821
2.772
2.808 –.021
Jan'19
3.067
3.078
3.035
3.070 –.018
Settle
Open
interest
Chg
14.51
14.94 s
14.42
14.62
14.46
14.87
.05
.17
May
July
2,455
2,502
2,522
2,571
2,417
2,474
2,502
2,553
49 64,101
55 100,041
4,096
2,138
May
July
117.85
119.80
119.45
121.35
117.70
119.60
118.65
120.55
1.20 108,478
1.15 83,820
1047.00
1057.50
13.25 290,145
12.75 315,250
May
July
12.34
12.38
12.41
12.46
12.29
12.35
12.36
12.42
.02 331,840
.04 308,113
389.60
393.70
3.30 157,611
3.60 160,296
t
31.29
31.52
t
31.56
31.79
Rough Rice (CBT)-2,000 cwt.; $ per cwt.
May
1249.50 1293.00 s
1249.50 1282.00
July
1259.50 1296.00
1259.50 1290.50
Wheat (CBT)-5,000 bu.; cents per bu.
May
478.00
493.75
474.75
490.75
July
494.25
508.50
491.25
506.00
Wheat (KC)-5,000 bu.; cents per bu.
May
514.25
528.75
511.00
522.75
July
533.00
547.75
529.75
541.75
Wheat (MPLS)-5,000 bu.; cents per bu.
609.50
629.50
609.50
626.50
May
July
620.00
639.00
620.00
636.50
Cattle-Feeder (CME)-50,000 lbs.; cents per lb.
April
136.000 138.025
134.100 134.450
May
136.200 138.575
135.025 135.525
Cattle-Live (CME)-40,000 lbs.; cents per lb.
April
112.975 113.975
111.975 112.025
June
103.025 104.600
102.100 102.500
Hogs-Lean (CME)-40,000 lbs.; cents per lb.
April
52.250
53.225
52.000
52.900
June
72.975
76.275
72.700
75.875
Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft.
533.30
536.00
530.10
534.20
May
July
520.90
523.00
517.50
520.50
–.01 196,779
–.02 161,170
May
July
389.75
398.75
May
July
236.75
245.25
May
July
1038.25
1048.50
May
July
386.80
390.80
392.50
400.75
388.75
397.25
390.75
399.00
2.25 497,638
2.00 578,976
238.25
246.25
235.75
243.25
237.25
243.50
4.00
2.50
Soybeans (CBT)-5,000 bu.; cents per bu.
1056.75
1067.50
1037.50
1048.50
Soybean Meal (CBT)-100 tons; $ per ton.
393.30
397.00
385.00
389.10
Soybean Oil (CBT)-60,000 lbs.; cents per lb.
20,994
2,333
31.53
31.83
May
July
27
72,995
337
147,662
377,656
387,086
176,977
197,438
255,512
143,791
124,948
96,288
122,306
97,883
361,694
132,532
165,312
116,637
129,455
75,753
31.75
32.02
32.50
31.00
4,983
2,048
18.50 188,245
17.50 153,350
16.00
16.25
19.25
19.50
–.875
–.100
Cocoa (ICE-US)-10 metric tons; $ per ton.
Coffee (ICE-US)-37,500 lbs.; cents per lb.
Sugar-World (ICE-US)-112,000 lbs.; cents per lb.
Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb.
t
24.35
24.53
t
24.90
24.90
Cotton (ICE-US)-50,000 lbs.; cents per lb.
82.89
83.69
82.70
82.91
May
July
82.50
83.34
82.39
82.76
Orange Juice (ICE-US)-15,000 lbs.; cents per lb.
137.75
139.00
136.30
138.50
May
July
138.60
139.50
137.25
139.15
May
July
24.55
24.91
24.55
24.91
90,208
96,271
146-000 146-100
145-010 145-060
28,673
18,545
June
Sept
120-315 121-005
120-185 120-200
–.200 19,857
.175 157,983
.775 14,987
2.600 102,745
–2.00
–2.70
5,113
1,306
Cash Prices | WSJ.com/commodities
Monday, April 09, 2018
These prices reflect buying and selling of a variety of actual or “physical” commodities in the marketplace—
separate from the futures price on an exchange, which reflects what the commodity might be worth in future
months.
Monday
0.7594
0.8731
2.710
2.670
3.210
2.360
2.060
2.410
2.640
61.100
12.350
Propane,tet,Mont Belvieu-g
Butane,normal,Mont Belvieu-g
NaturalGas,HenryHub-i
NaturalGas,TranscoZone3-i
NaturalGas,TranscoZone6NY-i
NaturalGas,PanhandleEast-i
NaturalGas,Opal-i
NaturalGas,MarcellusNE PA-i
NaturalGas,HaynesvilleN.LA-i
Coal,C.Aplc.,12500Btu,1.2SO2-r,w
Coal,PwdrRvrBsn,8800Btu,0.8SO2-r,w
Metals
Monday
16.2750
12191
(U.S.$ equivalent)
Coins,wholesale $1,000 face-a
Other metals
LBMA Platinum Price PM
*911.0
Platinum,Engelhard industrial
926.0
Platinum,Engelhard fabricated
1026.0
Palladium,Engelhard industrial
935.0
Palladium,Engelhard fabricated
1035.0
Aluminum, LME, $ per metric ton
*1967.0
Copper,Comex spot
3.0715
Iron Ore, 62% Fe CFR China-s
64.1
Shredded Scrap, US Midwest-s,m
366
Steel, HRC USA, FOB Midwest Mill-s
880
Fibers and Textiles
Gold, per troy oz
1336.92
1437.19
1331.95
1478.46
*1325.60
*1331.20
1390.27
1403.64
1403.64
1619.78
1313.33
1403.64
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA Gold Price AM
LBMA Gold Price PM
Krugerrand,wholesale-e
Maple Leaf-e
American Eagle-e
Mexican peso-e
Austria crown-e
Austria phil-e
Silver, troy oz.
16.4500
19.7400
16.4720
20.5900
£11.6100
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA spot price
Burlap,10-oz,40-inch NY yd-n,w
Cotton,1 1/16 std lw-mdMphs-u
Cotlook 'A' Index-t
Hides,hvy native steers piece fob-u
Wool,64s,staple,Terr del-u,w
0.6100
0.8191
*92.05
n.a.
n.a.
Grains and Feeds
Barley,top-quality Mnpls-u
Bran,wheat middlings, KC-u
Corn,No. 2 yellow,Cent IL-bp,u
Corn gluten feed,Midwest-u,w
Corn gluten meal,Midwest-u,w
Cottonseed meal-u,w
Hominy feed,Cent IL-u,w
Meat-bonemeal,50% pro Mnpls-u,w
Oats,No.2 milling,Mnpls-u
Rice, Long Grain Milled, No. 2 AR-u,w
Sorghum,(Milo) No.2 Gulf-u
n.a.
89
3.5800
108.2
525.3
275
98
295
2.7475
25.75
n.a.
Monday
SoybeanMeal,Cent IL,rail,ton48%-u 392.60
Soybeans,No.1 yllw IL-bp,u
10.0600
Wheat,Spring14%-pro Mnpls-u
7.6400
Wheat,No.2 soft red,St.Louis-bp,u
4.9350
Wheat - Hard - KC (USDA) $ per bu-u 5.1275
Wheat,No.1soft white,Portld,OR-u
5.6888
Food
Beef,carcass equiv. index
choice 1-3,600-900 lbs.-u
select 1-3,600-900 lbs.-u
Broilers, National comp wghtd-u,w
Butter,AA Chicago
Cheddar cheese,bbl,Chicago
Cheddar cheese,blk,Chicago
Milk,Nonfat dry,Chicago lb.
Cocoa,Ivory Coast-w
Coffee,Brazilian,Comp
Coffee,Colombian, NY
Eggs,large white,Chicago-u
Flour,hard winter KC
Hams,17-20 lbs,Mid-US fob-u
Hogs,Iowa-So. Minnesota-u
Pork bellies,12-14 lb MidUS-u
Pork loins,13-19 lb MidUS-u
Steers,Tex.-Okla. Choice-u
Steers,feeder,Okla. City-u,w
189.88
178.04
1.0874
2.3200
147.75
160.25
72.75
n.a.
1.1955
1.3946
2.0550
16.25
n.a.
53.20
1.2296
0.7989
n.a.
155.38
Fats and Oils
30.8000
0.2200
n.a.
0.2987
0.2475
n.a.
Corn oil,crude wet/dry mill-u,w
Grease,choice white,Chicago-h
Lard,Chicago-u
Soybean oil,crude;Centl IL-u
Tallow,bleach;Chicago-h
Tallow,edible,Chicago-u
KEY TO CODES: A=ask; B=bid; BP=country elevator bids to producers; C=corrected; E=Manfra,Tordella & Brooks; G=ICE; H=Hurley Brokerage; I=Natural Gas Intelligence;
M=monthly; N=nominal; n.a.=not quoted or not available; R=SNL Energy; S=Platts-TSI; T=Cotlook Limited; U=USDA; W=weekly, Z=not quoted. *Data as of 4/6
Source: WSJ Market Data Group
April 9, 2018
Key annual interest rates paid to borrow or lend money in U.S. and international markets. Rates below are a
guide to general levels but don’t always represent actual transactions.
Week
Latest ago
Feb. index
level
Chg From (%)
Jan. '18 Feb. '17
U.S. consumer price index
248.991
255.783
All items
Core
0.45
0.45
2.2
1.8
Latest
52-Week
High
Low
0.25
1.50
2.18
0.76
Week
Latest ago
2.18
1.78
U.S.
2.25
0.00
0.50
0.00
0.50
0.00
0.50
0.00
0.50
Effective rate
High
Low
Bid
Offer
1.7100
1.9000
1.6500
1.6700
1.7100
n.a.
1.8125
1.6500
1.6800
1.6900
2.25
1.50
June
Sept
1.7100
1.9000
1.6500
1.7000
1.7200
0.8600
1.0625
0.7000
0.8200
0.8300
June
Week
Latest ago
April
Jan'19
145-140
144-210
146-020
145-060
1.0 765,284
1.0
91
120-230
120-150
120-290
120-205
–3.5 3,435,277
–3.5
2,250
114-122 114-127
114-005 114-005
114-067
113-310
114-100
114-000
1.695 1.705 1.720 0.695
Data are annualized on a 360-day basis. Treasury yields are per annum,
on actively traded noninflation and inflation-indexed issues that are
adjusted to constant maturities. Data are from weekly Federal Reserve
release H.15.
One month
Three month
Six month
One year
1.68
Treasury yields (secondary market)
1.68
1.68
0.87
1.86
1.89
2.00
1.86
1.90
2.01
0.82
0.85
0.91
Commercial paper
Nonfinancial
1-month
2-month
3-month
Financial
1-month
2-month
3-month
1.83
1.90
2.01
1.79
2.02
2.28
1.84
2.05
2.18
1.84
2.05
2.28
0.88
0.94
1.00
Discount window primary credit
2.25
2.25
2.25
1.50
Conventional mortgages
n.a.
n.a.
n.a.
n.a.
Treasury yields at constant
maturities
1-month
3-month
6-month
1-year
2-year
3-year
5-year
7-year
10-year
20-year
1.68
1.74
1.92
2.07
2.28
2.41
2.60
2.72
2.78
2.90
1.67
1.76
1.94
2.09
2.29
2.41
2.59
2.72
2.79
2.90
52-Week
High
Low
1.71
1.76
1.96
2.09
2.31
2.45
2.66
2.83
2.91
3.07
0.71
0.80
0.93
1.02
1.20
1.39
1.65
1.90
2.07
2.43
1-month
3-month
6-month
1.65
1.71
1.87
1.64
1.73
1.89
1.68
1.73
1.91
0.69
0.79
0.91
TIPS
5-year
7-year
10-year
20-year
Long-term avg
0.60
0.68
0.71
0.84
0.86
0.65
0.72
0.72
0.85
0.88
0.68
0.78
0.79
0.94
0.96
0.01
0.20
0.28
0.60
0.65
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
Interest rate swaps
1-year
2-year
3-year
4-year
5-year
7-year
10-year
30-year
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.29
106-110 106-110
106-087
106-095
–1.0 1,949,839
98.315
97.890
98.318
97.890
98.318
97.870
… 354,871
–.015 322,505
98.315
97.860
June
94.375
April
May
98.1025
98.0875
April
June
Dec
Dec'19
97.6700
97.6800
97.5100
97.2150
94.781
94.375
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
State and local bonds
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
Eurodollars
1 month
3 month
6 month
94.656
–.047
29,151
98.1025
98.0925
…
.0100
4,094
1,422
97.6800 .0100
97.6950 .0150
97.5050
…
97.2050 –.0050
309,407
1,776,401
2,061,011
2,153,113
1 Month Libor (CME)-$3,000,000; pts of 100%
98.1025
98.0900
98.1025
98.0875
t 97.6600
97.6825
97.6950
97.5100
97.2150
97.6600
97.4800
97.1900
Chg
Open
interest
Currency Futures
April
June
.9351
.9396
.9371
.9420
.9337
.9369
.9368
.9406
.0004
617
.0004 149,320
April
June
.7828
.7836
.7874
.7893
.7810
.7811
.7875
.7884
.0048
241
.0048 117,043
April
June
1.4102
1.4125
1.4160
1.4204
1.4089
1.4118
1.4137
1.4173
.0047
949
.0047 170,628
June
1.0485
1.0519
1.0465
1.0515
.0024
April
May
June
July
Sept
Dec
.7689
.7690
.7670
.7659
.7684
.7679
.7704
.7711
.7712
.7706
.7716
.7679
.7659
.7656
.7653
.7656
.7662
.7678
.7704
.7705
.7705
.7707
.7710
.7716
June
Sept
.05406
.05322
.05433
.05356
.05376
.05307
.05409 .00011 218,773
.05334 .00011
544
April
June
1.2282
1.2338
1.2335
1.2393
1.2273
1.2322
1.2327
1.2383
Canadian Dollar (CME)-CAD 100,000; $ per CAD
British Pound (CME)-£62,500; $ per £
Swiss Franc (CME)-CHF 125,000; $ per CHF
Australian Dollar (CME)-AUD 100,000; $ per AUD
Mexican Peso (CME)-MXN 500,000; $ per MXN
50,749
.0022
996
.0022
319
.0022 101,469
.0022
224
.0023
752
.0022
389
.0035
1,832
.0034 483,281
Index Futures
Mini DJ Industrial Average (CBT)-$5 x index
June
Sept
23948
24019
24346
24378
23911
23943
24012
24040
86
85
97,245
2,217
June
2612.70
2653.00
2609.10
2619.10
13.40
67,505
June
Sept
2607.50
2613.00
2653.75
2657.25
2607.50
2613.00
2619.00
2623.00
13.25 2,900,411
13.00 81,272
June
1859.90
1881.10
1853.20
1855.70
June
Sept
6463.0
6494.0
6618.0
6643.5
6460.0
6488.5
6497.0
6523.5
June
1517.00
1537.40
1513.60
1519.10
June
1453.70
1453.70
1450.20
1451.80
5.70
69
June
Sept
89.85
89.44
89.98
89.50
89.51
89.10
89.53
89.11
–.25
–.24
29,735
981
S&P 500 Index (CME)-$250 x index
Mini S&P 500 (CME)-$50 x index
Mini S&P Midcap 400 (CME)-$100 x index
Mini Nasdaq 100 (CME)-$20 x index
Mini Russell 2000 (ICE-US)-$100 x index
Mini Russell 1000 (ICE-US)-$100 x index
U.S. Dollar Index (ICE-US)-$1,000 x index
1.60
76,559
42.3 239,372
42.0 10,592
3.40
9,010
Source: SIX Financial Information
Bonds | WSJ.com/bonds
Tracking Bond Benchmarks
Return on investment and spreads over Treasurys and/or yields paid to investors compared with 52-week
highs and lows for different types of bonds
Total
return
close
YTD total
return (%)
Yield (%)
Latest Low High
Index
-1.5
YTD total
return (%)
Yield (%)
Latest Low High
Index
Mortgage-Backed Bloomberg Barclays
Broad Market Bloomberg Barclays
1915.43
Total
return
close
3.140 2.380 3.230
U.S. Aggregate
U.S. Corporate Indexes Bloomberg Barclays
1964.73
-1.2
Mortgage-Backed
1929.73
-1.2
Ginnie Mae (GNMA) 3.300 2.630 3.410
Fannie mae (FNMA) 3.310 2.670 3.410
3.310 2.660 3.410
2736.47
-2.3
U.S. Corporate
3.760 3.030 3.860
1152.55
-1.2
2583.59
-1.4
Intermediate
3.460 2.530 3.550
1775.10
-1.2
Freddie Mac (FHLMC) 3.320 2.680 3.420
Long term
4.410 3.990 4.530
515.78
-1.2
Muni Master
2.544 1.736 2.544
3778.48 -4.1
558.27
-1.8
Double-A-rated
3.230 2.470 3.320
358.52
-1.9
7-12 year
2.619 1.744 2.635
707.43
-2.1
Triple-B-rated
4.030 3.340 4.120
405.42
-1.6
12-22 year
2.890 2.213 2.905
393.71
-1.6
22-plus year
3.264 2.716 3.296
High Yield Bonds Merrill Lynch
415.62
-0.5
High Yield Constrained 6.265 5.373 6.417
Global Government J.P. Morgan†
-0.1
Triple-C-rated
10.185 9.640 11.091
543.60
2840.78
-0.7
High Yield 100
5.979 4.948 6.319
755.16
0.04
Canada
2.170 1.570 2.340
377.53
-0.4
Global High Yield Constrained 5.643 4.934 5.755
375.36
1.3
EMU§
1.058 0.956 1.311
305.61
-0.2
Europe High Yield Constrained 2.909 1.897 3.083
715.06
0.6
France
0.840 0.690 1.070
507.85
0.1
Germany
0.540 0.210 0.740
0.9
423.94
U.S Agency Bloomberg Barclays
Global Government 1.510 1.300 1.650
1628.22
-0.6
U.S Agency
2.580 1.690 2.650
290.17
0.5
Japan
0.370 0.340 0.460
1457.04
-0.4
10-20 years
2.480 1.490 2.530
561.42
0.2
Netherlands
0.630 0.390 0.830
1.600 1.340 1.830
3324.14
-1.9
20-plus years
3.190 2.730 3.400
925.56
-0.6
U.K.
2428.44
-1.4
Yankee
3.430 2.610 3.500
794.69
-1.6
Emerging Markets ** 6.004 5.279 6.104
*Constrained indexes limit individual issuer concentrations to 2%; the High Yield 100 are the 100 largest bonds
** EMBI Global Index
† In local currency § Euro-zone bonds
Sources: Merrill Lynch; Bloomberg Barclays; J.P.Morgan
Notes on data:
Federal-funds rate is an average for the seven days ended Wednesday, weighted according to rates
on broker trades; Commercial paper rates are discounted offer rates interpolated from sales by
discounted averages of dealer bid rates on nationally traded certificates of deposit; Discount window
primary credit rate is charged for discounts made and advances extended under the Federal
Reserve's primary credit discount window program; rate is average for seven days ended Wednesday;
Inflation-indexed long-term TIPS average is indexed and is based on the unweighted average bid
yields for all TIPS with remaining terms to maturity of 10 years or more; Swap rates are International
Swaps and Derivatives Association (ISDA(R)) mid-market par rates for a fixed-rate payer, who in
return receives three-month Libor, and are based on rates collected at 11:00 a.m. ET by Garban
Intercapital PLC; Source is Reuters; Moody's triple-AAA rates are averages of industrial bonds only;
Muni rates are Thursday quotes based on the Bond Buyer Index for general obligation, 20 years to
maturity, mixed quality debt; Mortgage rates are contract rates on commitments for fixed-rate first
mortgages
Sources: Federal Reserve; for additional information on these rate data and their derivation,
please see, www.federalreserve.gov/releases/h15/data.htm
Yields and spreads over or under U.S. Treasurys on benchmark two-year and 10-year government bonds in
selected other countries; arrows indicate whether the yield rose(s) or fell (t) in the latest session
Country/
Coupon (%) Maturity, in years
2.250
2.750
4.500
Australia 2
10
2.31
0.050
2.000
3.50
2.75
2.31
1.400
1.400
0
1
l
l
2.033 t
2.684 s
l
l
France 2 -0.494 s
10 0.741 s
l
Germany 2 -0.579 s
10 0.506 s
l
l
l
Italy 2 -0.310 s
10 1.770 t
l
Japan 2 -0.146 t
10 0.035 t
l
Spain 2 -0.332 s
10 1.231 s
l
2.000
U.K. 2
4.250
10
Yield (%)
3 4 Previous
2
U.S. 2 2.283 s
10 2.790 s
2.250
0.000
Latest(l)-2 -1
l
l
l
0.879 s
1.407 s
l
l
Spread Under/Over U.S. Treasurys, in basis points
Latest
Prev
Year ago
Month ago
Year ago
2.270
2.777
2.262
2.895
1.286
2.382
2.039
2.015
1.665
-25.0
-23.1
2.668
2.795
2.562
-10.7
-10.9
18.0
-0.506
-0.454
-0.513 -277.7
0.889
-204.9
-277.6
-179.9
-204.5
-149.3
0.732
0.895
-0.590
-0.567
0.500
37.9
-286.0
-209.3
0.647
-0.807 -286.2
0.228
-228.4
-227.8
-215.4
-0.319
-0.223
-0.090
-258.9
-137.7
1.784
2.012
2.043
-0.145
-0.151
-0.214
0.041
0.054
-0.339
-0.371
-0.233
1.220
1.420
1.602
0.862
0.834
1.396
1.495
-259.3
-102.0
-242.9
0.050 -275.6
-261.5
-99.4
-34.0
-241.5
-150.0
-273.6
-233.3
-261.0
-152.0
-155.9
-155.8
-78.0
0.114
-140.3
-140.9
-117.2
1.078
-138.3
-138.2
-130.4
Source: Tullett Prebon
0.99
Corporate Debt
in that same company’s share price.
1.89713
2.33730
2.47063
2.70356
1.88313
2.31175
2.45240
2.66263
1.89713
2.33746
2.47219
2.70825
0.98833
1.15317
1.39072
1.69511
-0.404
-0.366
-0.325
-0.245
-0.407
-0.371
-0.325
-0.246
-0.391
-0.358
-0.254
-0.131
-0.420
-0.389
-0.339
-0.263
Euro Libor
One month
Three month
Six month
One year
Euro interbank offered rate (Euribor)
-0.372
-0.329
-0.270
-0.191
One month
Three month
Six month
One year
Latest
-0.372
-0.328
-0.271
-0.190
Value
Traded
-0.366
-0.325
-0.241
-0.118
-0.375
-0.332
-0.279
-0.194
52-Week
High
Low
DTCC GCF Repo Index
Treasury
MBS
1.834 21.500 2.068 0.791
1.829 126.350 1.971 0.794
Open Implied
Settle Change Interest Rate
Corporate bonds, Moody's seasoned
Aaa
Baa
3.50
Commercial paper (AA financial)
Libor
Federal funds (effective)
–2.5 3,423,235
–2.0
7
Settle
Japanese Yen (CME)-¥12,500,000; $ per 100¥
Euro (CME)-€125,000; $ per €
10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100%
0.100
52-Week
high
low
Call money
3.50
Week Ended
Apr 6 Mar 30
8,612
3,351
30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg.
0.100
Other short-term rates
Key Interest Rates
52-Week
High
Low
1.05
.70
2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100%
0.500
4.029 4.043 4.109 3.253
4.059 4.077 4.139 3.281
30 days
60 days
90 days
Week Ended
Apr 6 Mar 30
86,642
88,201
5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100%
0.000
30-year mortgage yields
Treasury bill auction
4 weeks
.37
.58
Treasury Notes (CBT)-$100,000; pts 32nds of 100%
0.750
Secondary market
Fannie Mae
Discount
2.25
—52-WEEK—
High Low
1.715 1.740 1.780 0.820
1.880 1.905 1.950 0.945
13 weeks
26 weeks
Federal funds
4.75 4.75 4.75 4.00
3.45 3.45 3.45 2.70
1.475 1.475 1.475 1.475
Policy Rates
Euro zone
Switzerland
0.50
1.50
U.S. government rates
Prime rates
U.S.
Canada
Japan
—52-WEEK—
High Low
Overnight repurchase
International rates
Week
ago
0.50
1.50
0.50
1.50
Britain
Australia
634
2,838
Contract
High hilo
Low
Open
Global Government Bonds: Mapping Yields
Borrowing Benchmarks | WSJ.com/bonds
Money Rates
Inflation
–.09
–.18
Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
June
Sept
6,251
20,146
3,577
3,607
Interest Rate Futures
Eurodollar (CME)-$1,000,000; pts of 100%
Energy
Open
interest
Chg
14.42
14.68
Oats (CBT)-5,000 bu.; cents per bu.
1,499
369,416
53,107
7,159
50,301
3,447
Settle
April
May
Corn (CBT)-5,000 bu.; cents per bu.
1,510
123,251
Contract
High hilo
Low
Open
Milk (CME)-200,000 lbs., cents per lb.
Agriculture Futures
Open
interest
WSJ.com/commodities
DTCC GCF Repo Index Futures
Treasury Apr
Treasury May
Treasury Jun
98.205 0.005 2625 1.795
98.220 0.005 896 1.780
98.105 unch. 551 1.895
Notes on data:
Investment-grade spreads that tightened the most…
Issuer
Symbol Coupon (%)
Oracle
Macquarie Bank
Celgene
Mitsui Sumitomo Insurance
ORCL
Banco Santander S.A.
United Parcel Service
Royal Bank of Scotland
SANTAN
MQGAU
CELG
MSINS
UPS
RBS
Maturity
Current
Spread*, in basis points
One-day change
Last week
Stock Performance
Close ($)
% chg
2.500 Oct. 15, ’22
4.875 June 10, ’25
4.000 Aug. 15, ’23
7.000 March 15, ’72
13
163
113
84
–32
–22
–21
–12
n.a.
n.a.
n.a.
n.a.
44.90
...
86.94
...
0.16
...
–0.01
...
5.179
2.050
8.625
155
37
230
–10
–9
–8
172
40
n.a.
...
104.60
7.45
...
–0.69
0.54
Nov. 19, ’25
April 1, ’21
Aug. 15, ’49
…And spreads that widened the most
General Electric
Toyota Industries
Biogen
Marathon Petroleum
GE
Oncor Electric Delivery
Dow Chemical
Banco Santander S.A.
UnitedHealth
ONCRTX
TOYAUT
BIIB
MPC
DWDP
SANTAN
UNH
5.000 Jan. 21, ’49
3.235 March 16, ’23
5.200 Sept. 15, ’45
5.000 Sept. 15, ’54
253
72
158
215
31
13
10
9
240
n.a.
165
n.a.
12.83
...
257.52
71.67
–1.76
...
–0.05
–1.08
3.750
7.375
3.800
2.375
90
133
152
59
8
7
7
7
n.a.
n.a.
152
n.a.
...
63.69
...
222.73
...
–0.03
...
–0.55
April 1, ’45
Nov. 1, ’29
Feb. 23, ’28
Oct. 15, ’22
High-yield issues with the biggest price increases…
Issuer
Symbol
Intelsat Luxembourg
Talen Energy Supply
New Albertsons
Leucadia National
INTEL
Spectrum Management Holding
Albertsons
Iron Mountain
Acosta
TWC
Coupon (%)
8.125
10.500
NEWALB 8.700
LUK
6.625
TALEE
ALBLLC
IRM
Maturity
Bond Price as % of face value
Current
One-day change
June 1, ’23
Jan. 15, ’26
May 1, ’30
Oct. 23, ’43
57.500
86.250
87.510
108.869
5.500 Sept. 1, ’41
6.625 June 15, ’24
4.875 Sept. 15, ’27
7.750
Oct. 1, ’22
100.761
93.750
94.750
63.750
5.50
Last week
Stock Performance
Close ($)
% chg
1.01
0.90
48.000
83.000
n.a.
n.a.
...
...
...
24.29
...
...
...
11.58
0.89
0.88
0.88
0.75
n.a.
89.760
93.500
62.095
...
...
33.32
...
...
...
–0.63
...
–2.37
–1.03
–0.75
n.a.
n.a.
86.000
102.750
...
...
3.52
34.79
...
...
1.15
0.87
–0.63
–0.60
–0.55
–0.53
100.440
104.250
n.a.
n.a.
...
5.11
…
…
...
–6.92
…
…
3.00
U.S. prime rate is the base rate on corporate
loans posted by at least 70% of the 10 largest
U.S. banks, and is effective March 22, 2018. Other
prime rates aren’t directly comparable; lending
practices vary widely by location; Discount rate
is effective March 22, 2018. DTCC GCF Repo
Index is Depository Trust & Clearing Corp.'s
weighted average for overnight trades in
applicable CUSIPs. Value traded is in billions of
U.S. dollars. Federal-funds rates are Tullett
Prebon rates as of 5:30 p.m. ET. Futures on the
DTCC GCF Repo Index are traded on NYSE Liffe
US.
Community Choice Financial
Westpac Banking
Ultra Resources
United States Steel
CCFI
Infor Software Parent
Comstock Resources
Seagate HDD Cayman
Lamar Media
LWSN
Sources: Federal Reserve; Bureau of Labor
Statistics; DTCC; SIX Financial Information;
Tullett Prebon Information, Ltd.
*Estimated spread over 2-year, 3-year, 5-year, 10-year or 30-year hot-run Treasury; 100 basis points=one percentage pt.; change in spread shown is for Z-spread.
Note: Data are for the most active issue of bonds with maturities of two years or more
Sources: MarketAxess Corporate BondTicker; WSJ Market Data Group
ACOSTA
…And with the biggest price decreases
WSTP
UPL
X
CRK
STX
LAMR
10.750
May 1, ’19
5.000 Sept. 21, ’49
6.875 April 15, ’22
6.875 Aug. 15, ’25
69.750
92.750
81.599
103.250
7.125
May 1, ’21
10.000 March 15, ’20
4.875
June 1, ’27
5.375 Jan. 15, ’24
100.750
101.750
94.250
103.250
–5.31
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | B11
BIGGEST 1,000 STOCKS
WSJ.com/stocks
How to Read the Stock Tables
The following explanations apply to NYSE,
NYSE Arca, NYSE American and Nasdaq Stock
Market listed securities. Prices are composite
quotations that include primary market trades
as well as trades reported by Nasdaq BX
(formerly Boston), Chicago Stock Exchange,
Cboe, NYSE National and Nasdaq ISE.
The list comprises the 1,000 largest
companies based on market capitalization.
Underlined quotations are those stocks with
large changes in volume compared with the
issue’s average trading volume.
Boldfaced quotations highlight those issues
whose price changed by 5% or more if their
previous closing price was $2 or higher.
Footnotes:
s-New 52-week high.
t-New 52-week low.
dd-Indicates loss in the most recent
four quarters.
FD-First day of trading.
h-Does not meet continued listing
standards
lf-Late filing
q-Temporary exemption from Nasdaq
requirements.
t-NYSE bankruptcy
v-Trading halted on primary market.
vj-In bankruptcy or receivership or
being reorganized under the
Bankruptcy Code, or securities
assumed by such companies.
Wall Street Journal stock tables reflect composite regular trading as of 4 p.m. and
changes in the closing prices from 4 p.m. the previous day.
Monday, April 9, 2018
Stock
Net
Sym Close Chg
A B C
ABB
ABB 22.63 0.31
ADT
ADT 9.12 0.37
AES
AES 11.39 -0.03
Aflac
AFL 43.59 0.22
AGNC Invt AGNC 18.87 -0.08
ANGI Homesvcs ANGI 13.16 -0.16
Ansys
ANSS 154.35 0.84
ASML
ASML 198.53 3.90
AT&T
T
35.17 0.04
AbbottLabs ABT 58.22 0.65
AbbVie
ABBV 90.48 0.70
Abiomed
ABMD 288.12 1.90
Accenture ACN 148.25 0.87
ActivisionBliz ATVI 65.77 1.21
Adient
ADNT 63.54 -0.38
AdobeSystems ADBE 219.17 0.56
AdvanceAuto AAP 110.35 -1.56
AdvMicroDevices AMD 9.53 -0.08
AdvSemiEngg ASX 7.10 0.05
Aegon
AEG 6.83 0.04
AerCap
AER 51.16 -0.27
Aetna
AET 171.52 1.14
AffiliatedMgrs AMG 174.68 -1.76
AgilentTechs A
65.19 1.54
AgnicoEagle AEM 43.10 0.55
AirProducts APD 160.23 0.27
AkamaiTech AKAM 70.46 1.12
AlaskaAir ALK 59.81 -0.96
Albemarle ALB 91.22 -0.58
Alcoa
AA 50.62 2.57
AlexandriaRlEst ARE 121.34 -0.73
AlexionPharm ALXN 110.63 1.39
Alibaba
BABA 169.87 2.35
AlignTech ALGN 249.06 3.83
Alkermes ALKS 42.43 0.25
Alleghany Y
592.39 0.37
Allegion
ALLE 84.54 -0.21
Allergan
AGN 161.88 0.36
AllianceData ADS 206.32 0.57
AlliantEnergy LNT 41.05 0.03
Allstate
ALL 95.78 -0.12
AllyFinancial ALLY 26.78 0.16
AlnylamPharm ALNY 97.33 2.25
Alphabet C GOOG 1015.45 8.41
Alphabet A GOOGL 1020.09 10.14
Altaba
AABA 68.44 0.89
AlticeUSA ATUS 18.63 0.13
Altria
MO 63.25 -0.60
AlumofChina ACH 14.42 0.77
Amazon.com AMZN 1406.08 0.85
Ambev
ABEV 6.79 -0.07
Amdocs
DOX 66.28 0.69
Amerco
UHAL 343.92 -1.88
Ameren
AEE 56.96 -0.17
AmericaMovil AMX 19.47 0.03
AmericaMovil A AMOV 19.45 0.14
AmerAirlines AAL 49.82 -0.47
AEP
AEP 68.71 0.18
AmerExpress AXP 92.14 0.23
AmericanFin AFG 110.08 0.41
AmHomes4Rent AMH 19.69 -0.02
AIG
AIG 53.30 -0.30
AmerTowerREIT AMT 143.19 1.03
AmerWaterWorks AWK 82.14 0.22
Ameriprise AMP 141.38 0.07
AmerisourceBrgn ABC 86.79 1.38
Ametek
AME 73.37 -0.17
Amgen
AMGN 169.62 1.48
Amphenol APH 83.58 1.01
AnadarkoPetrol APC 59.83 0.97
AnalogDevices ADI 87.99 -0.32
Andeavor ANDV 106.58 -0.32
AndeavorLog ANDX 44.69 -0.22
AB InBev BUD 108.71 0.77
AnnalyCap NLY 10.46 -0.02
AnteroResources AR 20.06 -0.05
Anthem
ANTM 222.87 -1.91
Aon
AON 139.01 0.81
Apache
APA 38.45 0.11
ApartmtInv AIV 41.05 -0.02
ApolloGlbMgmt APO 29.76 0.14
Apple
AAPL 170.05 1.67
ApplMaterials AMAT 53.02 0.68
Aptiv
APTV 83.67 -0.15
AquaAmerica WTR 33.81 0.12
Aramark
ARMK 38.32 -0.23
ArcelorMittal MT 31.16 0.08
t ArchCapital ACGL 80.37 -5.04
ArcherDaniels ADM 44.22 -0.11
Arconic
ARNC 22.77 0.23
AristaNetworks ANET 259.50 0.78
ArrowElec ARW 74.14 1.35
AspenTech AZPN 80.38 1.15
AstraZeneca AZN 35.90 0.48
Athene
ATH 47.54 -0.01
Atlassian
TEAM 55.90 1.31
AtmosEnergy ATO 84.18 0.03
Autodesk ADSK 127.57 1.82
Autohome ATHM 89.34 1.13
Autoliv
ALV 146.69 0.06
ADP
ADP 114.44 0.74
AutoZone AZO 615.10 -5.26
Avalonbay AVB 165.42 -0.58
Avangrid
AGR 50.98 0.01
AveryDennison AVY 103.90 0.70
AxaltaCoating AXTA 32.16 -0.31
BB&T
BBT 51.64 0.52
BCE
BCE 42.98 0.25
BHPBilliton BHP 43.63 -0.01
BHPBilliton BBL 38.80 -0.24
BOK Fin
BOKF 98.40 -0.33
BP
BP 41.66 -0.10
BT Group BT 16.62 0.06
BWX Tech BWXT 64.83 0.24
Baidu
BIDU 224.33 4.51
BakerHughes BHGE 29.40 -0.18
Ball
BLL 39.30 0.04
BancoBilbaoViz BBVA 7.82 0.09
BancodeChile BCH 99.95 0.22
BancoMacro BMA 107.35 -1.05
BcoSantChile BSAC 33.73 -0.13
BcoSantMex BSMX 7.27 -0.15
BancoSantander SAN 6.55 0.03
BanColombia CIB 47.36 0.79
BankofAmerica BAC 29.87 0.24
BankofMontreal BMO 76.15 0.68
BankNY Mellon BK 50.52 0.17
BkNovaScotia BNS 60.88 0.53
BankofOzarks OZRK 46.35 -0.47
Barclays
BCS 12.01 0.11
BarrickGold ABX 12.68 -0.01
BaxterIntl BAX 64.79 0.90
BectonDicknsn BDX 217.40 1.90
BeiGene
BGNE 166.23 1.75
Berkley
WRB 72.27 0.07
Stock
Net
Sym Close Chg
Net
Sym Close Chg
Stock
BerkHathwy B BRK.B 195.33 -0.16 Cullen/Frost CFR 104.48
BerkHathwy A BRK.A 2950651065.01 Cummins
CMI 156.50
BerryGlobal BERY 54.75 0.70 CurtissWright CW 134.58
BestBuy
BBY 69.82 -0.67 CypressSemi CY 16.24
Bio-RadLab A BIO 244.80 0.70
Biogen
BIIB 257.52 -0.13
BioMarinPharm BMRN 78.65 2.64
DISH Network DISH 38.42
BlackKnight BKI 48.15 0.45
DTE Energy DTE 104.34
BlackBerry BB 10.18 -0.01
DXC Tech DXC 100.04
BlackRock BLK 521.14 1.22
Danaher
DHR 97.60
Blackstone BX 30.71 -0.30
Darden
DRI 86.55
BlueBuffaloPet BUFF 39.96 0.04
DaVita
DVA 62.77
bluebirdbio BLUE 173.25 10.55 Deere
DE 142.96
Boeing
BA 322.48 -3.64 DellTechs DVMT 71.90
BookingHldgs BKNG 2048.74 15.33 DeltaAir
DAL 52.56
BoozAllen BAH 38.83 -0.01 DentsplySirona XRAY
49.25
BorgWarner BWA 51.57 0.30 DeutscheBank DB
14.01
BostonProps BXP 120.12 -0.84
DevonEnergy DVN 31.47
BostonSci BSX 27.51 0.16
DexCom
DXCM 70.38
Braskem
BAK 27.33 -0.23
Diageo
DEO 140.92
BrightHorizons BFAM 96.47 0.37
DiamondbkEner FANG113.29
BrighthouseFin BHF 50.08 -0.16
DigitalRealty DLR 104.38
Bristol-Myers BMY 60.48 -0.40
DiscoverFinSvcs DFS 70.67
BritishAmTob BTI 60.30 0.03
DiscoveryA DISCA 22.53
Broadcom AVGO234.74 5.87
DiscoveryC DISCK 20.67
BroadridgeFinl BR 106.89 0.34
Disney
DIS 99.70
BrookfieldMgt BAM 38.83 0.28
DolbyLab
DLB 64.22
BrookfieldInfr BIP 41.28 -0.32
DollarGeneral DG 95.70
Brown&Brown BRO 25.26 0.17
DollarTree DLTR 98.74
Brown-Forman B BF.B 55.09 0.67 t
DominionEner D
66.37
Brown-Forman A BF.A 54.30 1.10
Domino's
DPZ 232.43
BuckeyePtrs BPL 36.89 -0.40
Donaldson DCI 43.76
Bunge
BG 74.91 -0.68
DouglasEmmett DEI 35.44
BurlingtonStrs BURL 136.47 -0.47
Dover
DOV 93.00
CA
CA 33.29 0.11
DowDuPont DWDP 63.69
CBD Pao
CBD 19.47 -0.72
DrPepperSnap DPS 119.50
CBRE Group CBRE 47.27 0.54
DropBox
DBX 30.14
CBS B
CBS 52.85 0.01
DukeEnergy DUK 78.47
CBS A
CBS.A 53.12 -0.01
DukeRealty DRE 25.61
CDK Global CDK 63.56 0.07
ENI
E
36.91
CDW
CDW 68.45 0.50
EOG Rscs EOG 103.38
CF Industries CF 37.16 0.33
EPAM Systems EPAM 110.56
CGI Group GIB 57.97 0.58
EQT
EQT 46.65
CH Robinson CHRW 91.57 1.09
E*TRADE ETFC 55.54
CIT Group CIT 51.06 -0.02
EastWestBncp EWBC 60.30
CME Group CME 159.18 0.92
EastmanChem EMN 102.69
CMS Energy CMS 45.10 -0.22
Eaton
ETN 75.93
CNA Fin
CNA 48.64 0.19
EatonVance EV 54.09
CNOOC
CEO 145.03 2.26
eBay
EBAY 38.88
CPFLEnergia CPL 14.23 -0.31
Ecolab
ECL 140.25
CRH
CRH 33.87 -0.08
Ecopetrol
EC 19.78
CSX
CSX 54.42 0.07
EdisonInt
EIX 63.46
CVS Health CVS 63.31 -0.07
EdwardsLife EW 137.37
CabotOil
COG 22.95 -0.22
ElectronicArts EA 118.86
CadenceDesign CDNS 36.25 0.35
EmersonElec EMR 66.19
CaesarsEnt CZR 10.70 -0.30
EnbridgeEnPtrs EEP 9.71
CamdenProperty CPT 84.57 -0.32
Enbridge
ENB 31.62
CampbellSoup CPB 43.26 -0.47
Encana
ECA 10.80
CIBC
CM 88.11 0.84
EncompassHealth EHC 57.66
CanNtlRlwy CNI 74.65 0.67
EnelAmericas ENIA 11.88
CanNaturalRes CNQ 32.74 -0.28
EnelChile
ENIC 6.21
CanPacRlwy CP 175.53 2.39
EnelGenChile EOCC 24.55
Canon
CAJ 35.80 0.28
Energen
EGN 60.52
CapitalOne COF 95.50 0.78
EnergyTransferEq ETE 14.27
CardinalHealth CAH 62.50 0.11
EnergyTransfer ETP 16.35
Carlisle
CSL 97.41 -0.91
Entergy
ETR 78.96
Carlyle
CG 20.20 -0.05
EnterpriseProd EPD 24.46
CarMax
KMX 58.77 -1.53
Equifax
EFX 116.85
Carnival
CCL 64.86 0.35
Equinix
EQIX 409.57
Carnival
CUK 65.17 0.42
EquityLife ELS 86.44
Caterpillar CAT 143.08 0.09
EquityResdntl EQR 62.30
CboeGlobalMkts CBOE 110.03 0.69
Ericsson
ERIC 6.22
Celanese A CE 100.97 1.05
EssexProp ESS 241.38
Celgene
CELG 86.94 -0.01
EsteeLauder EL 150.33
Cemex
CX
7.04 0.17
EverestRe RE 257.84
CenovusEnergy CVE 9.33 -0.03
EversourceEner ES 59.71
Centene
CNC 106.58 -0.45
Exelixis
EXEL 19.67
CenterPointEner CNP 27.13 0.24
Exelon
EXC 38.59
CentraisElBras EBR 5.44 -0.66
Expedia
EXPE 107.25
CenturyLink CTL 17.31 0.10
ExpeditorsIntl EXPD 61.51
Cerner
CERN 56.57 0.15
ExpressScripts ESRX 68.03
CharterComms CHTR 316.51 5.84
ExtraSpaceSt EXR 86.87
CheckPoint CHKP 100.16 1.60
ExxonMobil XOM 74.87
Chemours CC 48.73 0.05
F5Networks FFIV 140.78
CheniereEnergy LNG 54.10 -0.26
FMC
FMC 77.99
CheniereEnerPtrs CQP 29.25 -0.15
Facebook
FB 157.93
CheniereEnHldgs CQH 27.14 -0.23
FactSet
FDS 195.61
Chevron
CVX 115.98 1.22
Fastenal
FAST 53.65
ChinaEastrnAir CEA 35.85 0.13
FederalRealty FRT 115.49
ChinaLifeIns LFC 13.70 0.15
FedEx
FDX 234.32
ChinaLodging HTHT 128.74 -1.00
Ferrari
RACE 120.19
ChinaMobile CHL 46.56 0.92
FiatChrysler FCAU 22.61
s ChinaPetrol SNP 92.72 1.69
FibriaCelulose FBR 19.40
ChinaSoAirlines ZNH 49.78 -0.60
FidNatlFin FNF 38.15
ChinaTelecom CHA 44.56 0.46
FidNatlInfo FIS 96.00
ChinaUnicom CHU 12.92 0.21
FifthThirdBncp FITB 31.40
Chipotle
CMG 317.10 -0.97
58.com
WUBA 77.57
Chubb
CB 134.16 0.03
FirstAmerFin FAF 55.51
s ChunghwaTel CHT 39.02 0.45
FirstData
FDC 15.61
Church&Dwight CHD 49.47 -0.03
FirstHorizonNatl FHN 18.65
Cigna
CI 167.94 0.12
FirstRepBank FRC 89.66
CimarexEnergy XEC 90.44 -0.02
FirstSolar FSLR 70.85
CincinnatiFin CINF 72.77 -0.23
FirstEnergy FE 34.14
Cintas
CTAS 167.67 0.93
Fiserv
FISV 70.13
CiscoSystems CSCO 41.17 0.44
FleetCorTech FLT 196.49
Citigroup
C
69.44 0.84
Flex
FLEX 16.04
CitizensFin CFG 41.74 0.26
FlirSystems FLIR 50.23
CitrixSystems CTXS 92.26 0.48
Flowserve FLS 43.45
Clorox
CLX 127.97 -0.54
Fluor
FLR 56.90
Coca-Cola KO 43.83 -0.09
FomentoEconMex FMX 93.68
Coca-Cola Euro CCE 41.66 -0.07
FordMotor F
11.25
Coca-Cola Femsa KOF 65.72 -0.39
s Fortinet
FTNT 54.47
Cognex
CGNX 49.70 0.41
Fortis
FTS 33.91
CognizantTech CTSH 78.91 -0.16
Fortive
FTV 74.11
ColgatePalm CL 71.42 -0.22
FortBrandsHome FBHS 58.17
Comcast A CMCSA 33.95 -0.17
Franco-Nevada FNV 68.43
Comerica
CMA 95.55 0.63
FranklinRscs BEN 33.07
CommerceBcshrs CBSH 58.90 -0.05
FreeportMcM FCX 17.43
CommScope COMM 38.85 -0.08
FreseniusMed FMS 50.86
SABESP
SBS 9.80 -0.24
ConagraBrands CAG 36.77 0.03
ConchoRscs CXO 133.38 -0.25
GGP 20.13
ConocoPhillips COP 60.62 1.36 GGP
ConEd
ED 78.46 -0.10 Gallagher AJG 67.43
ConstBrands A STZ 226.21 -0.98 Gaming&Leisure GLPI 33.55
GPS 30.07
ContinentalRscs CLR 58.94 0.02 Gap
Cooper
COO 219.83 1.85 GardnerDenver GDI 29.36
GRMN 58.51
Copart
CPRT 49.89 0.23 Garmin
IT 116.27
Corning
GLW 26.71 0.16 Gartner
CoStar
CSGP 356.86 5.58 Gazit-Globe GZT 9.71
Costco
COST 184.41 0.45 GeneralDynamics GD 214.96
Coty
COTY 18.33 0.04 GeneralElec GE 12.83
Credicorp
BAP 233.05 -1.63 GeneralMills GIS 44.95
CreditAcceptance CACC 314.11 -2.15 GeneralMotors GM 37.83
G
31.37
CreditSuisse CS 16.24 0.08 Genpact
GNTX 23.50
CrownCastle CCI 108.86 0.85 Gentex
CrownHoldings CCK 49.24 0.48 GenuineParts GPC 88.81
Ctrip.com CTRP 44.78 -0.02 Gerdau
GGB 4.56
D E F
G H I
Mutual Funds
-0.19
-1.40
0.34
-0.05
Stock
Gildan
GIL 29.26
GileadSciences GILD 73.80
GSK
GSK 40.29
GlobalPayments GPN 108.48
GoDaddy
GDDY 60.63
Goldcorp
GG 13.93
GoldmanSachs GS 252.19
Goodyear GT 27.12
Graco
GGG 45.11
Grainger
GWW 286.63
GreatPlainsEner GXP 30.97
Grifols
GRFS 20.67
GrubHub
GRUB 97.08
GpoAeroportuar PAC 103.56
GpoAvalAcc AVAL 8.77
GpoFinGalicia GGAL 65.97
GrupoTelevisa TV 18.02
Guidewire GWRE 80.19
HCA Healthcare HCA 96.31
HCP
HCP 23.14
HDFC Bank HDB 98.72
HD Supply HDS 38.38
HP
HPQ 20.89
HSBC
HSBC 47.73
Halliburton HAL 46.56
Hanesbrands HBI 18.58
HarleyDavidson HOG 41.95
Harris
HRS 162.83
HartfordFinl HIG 51.20
Hasbro
HAS 84.45
Heico A
HEI.A 70.95
Heico
HEI 86.67
Helm&Payne HP 65.90
HenrySchein HSIC 66.87
Herbalife
HLF 98.51
Hershey
HSY 99.36
Hess
HES 51.60
HewlettPackard HPE 16.81
Hexcel
HXL 64.34
Hilton
HLT 76.15
s HollyFrontier HFC 52.91
Hologic
HOLX 36.53
HomeDepot HD 172.51
HondaMotor HMC 34.30
Honeywell HON 142.83
HormelFoods HRL 35.39
DR Horton DHI 45.08
HostHotels HST 18.24
HowardHughes HHC 135.34
HuanengPower HNP 25.86
Hubbell
HUBB 117.37
Humana
HUM 285.00
JBHunt
JBHT 109.21
HuntingtonBcshs HBAN 14.62
HuntingIngalls HII 257.14
Huntsman HUN 28.10
HyattHotels H
75.08
IAC/InterActive IAC 151.89
ICICI Bank IBN 8.55
IdexxLab
IDXX 187.13
IHSMarkit INFO 48.00
ING Groep ING 16.89
Invesco
IVZ 30.65
IPG Photonics IPGP 222.90
IQVIA
IQV 95.48
IRSA Prop IRCP 45.00
IcahnEnterprises IEP 59.69
Icon
ICLR 113.36
IDEX
IEX 139.24
IllinoisToolWks ITW 152.59
Illumina
ILMN 230.18
ImperialOil IMO 27.96
t Incyte
INCY 65.36
Infosys
INFY 17.26
Ingersoll-Rand IR
82.76
Ingredion
INGR 127.43
Intel
INTC 49.55
InteractiveBrkrs IBKR 69.02
ICE
ICE 70.89
InterContinentl IHG 60.48
IBM
IBM 152.69
IntlFlavors IFF 135.87
IntlPaper
IP
51.99
Interpublic IPG 23.24
Intuit
INTU 169.39
IntuitiveSurgical ISRG 405.65
InvitatHomes INVH 22.55
iQIYI
IQ
16.41
IronMountain IRM 33.32
IsraelChemicals ICL
4.33
ItauUnibanco ITUB 14.67
-0.09
0.28
0.28
0.94
0.32
-0.26
-2.43
0.61
-0.49
0.23
0.14
0.02
0.23
1.75
-3.33
0.08
0.33
-0.09
-0.06
-0.65
1.21
1.02
0.02
0.15
0.97
-0.17
-0.36
-0.19
-0.02
0.90
-0.10
0.31
-0.07
0.44
1.45
-0.45
-0.25
0.30
-0.11
-0.16
-0.04
-0.26
-0.21
0.47
0.42
0.08
-0.14
0.50
-0.12
-0.10
0.39
-0.12
0.08
0.02
...
-0.01
-0.67
0.08
-0.19
-0.02
0.24
-0.73
2.53
-0.55
-0.75
0.01
JD 40.07
-1.00 JD.com
0.08 JPMorganChase JPM 110.40
3.59 JackHenry JKHY 118.49
0.06 JacobsEngg JEC 58.32
-1.42 JamesHardie JHX 17.31
-0.04 JanusHenderson JHG 31.62
-0.30 JazzPharma JAZZ 150.86
JBLU 19.48
-0.08 JetBlue
JNJ 129.48
0.15 J&J
t
JohnsonControls
JCI 33.26
0.05
... JonesLang JLL 173.00
0.07 JuniperNetworks JNPR 24.10
-0.14 KAR Auction KAR 53.69
KB 52.99
0.73 KB Fin
KKR 20.01
1.96 KKR
KLA
Tencor
KLAC 103.79
...
KT 14.00
-0.29 KT
KSCitySouthern
KSU 108.72
0.03
K
64.48
-0.56 Kellogg
KEY 19.19
0.30 KeyCorp
KeysightTechs
KEYS
51.29
-0.34
-0.37 KilroyRealty KRC 69.07
0.47 KimberlyClark KMB 108.36
0.16 KimcoRealty KIM 14.27
0.60 KinderMorgan KMI 15.10
-0.93 Knight-Swift KNX 42.73
KSS 63.43
0.14 Kohl's
0.08 KoninklijkePhil PHG 38.75
-0.17 KoreaElcPwr KEP 16.16
1.15 KraftHeinz KHC 60.65
KR 23.54
-0.06 Kroger
Kyocera
KYO 55.65
0.29
LATAMAirlines
LTM 15.66
0.15
L
Brands
LB 38.06
0.05
LG Display LPL 11.73
0.04
LINE
LN 39.92
0.27
LKQ
LKQ 38.11
0.18
L3 Tech
LLL 208.67
-0.14
LabCpAm LH 162.64
0.07
LamResearch LRCX 193.12
0.14
LamarAdv LAMR 63.93
0.19
s LambWeston LW 62.29
-0.61
LasVegasSands LVS 69.88
-0.55
Lazard
LAZ 52.05
0.62
Lear
LEA 189.17
-0.15
Leggett&Platt LEG 43.82
0.10
Leidos
LDOS 64.78
0.42
Lennar A
LEN 60.78
Lennar B
LEN.B 49.29
LennoxIntl LII 199.06
-0.12 LeucadiaNatl LUK 24.29
0.34 LibertyBroadbandA LBRDA 82.95
-0.17 LibertyBroadbandC LBRDK 83.16
-0.77 LibertyGlobal C LBTYK 30.29
-0.47 LibertyGlobal A LBTYA 31.29
0.09 LibertyQVC A QRTEA 25.19
-0.02 LibertyFormOne C FWONK 29.41
0.06 LibertyFormOne A FWONA 28.13
-0.78 LibertyBraves A BATRA 22.21
-0.23 LibertyBraves C BATRK 22.40
-0.03 LibertySirius A LSXMA 41.06
0.15 LibertySirius C LSXMK 40.92
0.03 LibertyProperty LPT 39.10
-0.18 EliLilly
LLY 77.34
-0.45 LincolnElectric LECO 87.92
-0.17 LincolnNational LNC 68.52
J K L
Data provided by
Top 250 mutual-funds listings for Nasdaq-published share classes with net assets of at least
$500 million each.
e-Ex-distribution. f-Previous day’s quotation. g-Footnotes x and s apply. j-Footnotes e and s
apply. k-Recalculated by Lipper, using updated data. p-Distribution costs apply, 12b-1. rRedemption charge may apply. s-Stock split or dividend. t-Footnotes p and r apply. v-Footnotes
x and e apply. x-Ex-dividend. z-Footnote x, e and s apply. NA-Not available due to incomplete
price, performance or cost data. NE-Not released by Lipper; data under review. NN-Fund not
tracked. NS-Fund didn’t exist at start of period.
Fund
Net YTD
NAV Chg % Ret Fund
American Century Inv
44.21
Ultra
American Funds Cl A
32.04
AmcpA p
39.42
AMutlA p
26.66
BalA p
12.63
BondA p
60.67
CapIBA p
51.02
CapWGrA
56.73
EupacA p
61.31
FdInvA p
50.40
GwthA p
10.21
HI TrA p
39.35
ICAA p
IncoA p
22.75
43.81
N PerA p
NEcoA p
46.50
67.17
NwWrldA
SmCpA p
56.15
12.79
TxExA p
WshA p
44.57
Baird Funds
AggBdInst
10.64
10.98
CorBdInst
BlackRock Funds A
+0.15
+0.12
+0.15
+0.06
-0.01
+0.29
+0.38
+0.41
+0.30
+0.24
+0.01
+0.13
+0.08
+0.28
+0.39
+0.05
+0.02
-0.01
+0.18
...
...
Monday, April 9, 2018
Net YTD
NAV Chg % Ret Fund
GlblAlloc p
19.47
1.8 BlackRock Funds Inst
22.13
EqtyDivd
1.7 GlblAlloc
19.59
-2.9 HiYldBd
7.66
-1.4 StratIncOpptyIns 9.91
-1.5 Bridge Builder Trust
-2.6 CoreBond
9.95
0.2 Dimensional Fds
0.9 5GlbFxdInc
10.83
-1.2 EmgMktVa
31.58
1.7 EmMktCorEq 23.40
-0.1 IntlCoreEq
14.42
-2.2 IntlVal
20.25
-2.0 IntSmCo
21.20
1.5 IntSmVa
22.45
4.2 US CoreEq1
22.36
0.4 US CoreEq2
21.07
0.6 US Small
35.06
-1.2 US SmCpVal 36.79
-1.9 US TgdVal
24.09
37.71
USLgVa
-1.5 Dodge & Cox
-1.5 Balanced
103.21
GblStock
13.43
... -1.2 Income
Net
Sym Close Chg
-0.8
-2.4
-2.6
NA
4.5
-5.4
-1.7
-1.8
-1.8
-1.1
-0.3
-1.8
-1.6
-1.6
-1.5
1.4
-0.7
-0.7
-0.8
Net
Sym Close Chg
Stock
Stock
Net
Sym Close Chg
Stock
Net
Sym Close Chg
Stock
Net
Sym Close Chg
W X Y Z
T U V
M N
R S
New Highs and Lows | WSJ.com/newhighs
Highs
Lows
Dividend Changes
Dividend announcements from April 9.
O P Q
Exchange-Traded Portfolios | WSJ.com/ETFresearch
Fund
Net YTD
NAV Chg % Ret Fund
Freedom2020 K
Freedom2025 K
Freedom2030 K
Freedom2035 K
Freedom2040 K
16.43
14.27
17.90
15.10
10.60
+0.04
+0.04
+0.06
+0.06
+0.04
-0.7
-0.8
-0.7
-0.7
-0.8
23.55
Balanc
BluCh
89.36
Contra
122.97
122.93
ContraK
10.11
CpInc r
DivIntl
39.39
184.68
GroCo
184.69
GrowCoK
7.76
InvGB
11.02
InvGrBd
53.89
LowP r
105.06
MagIn
OTC
111.74
23.18
Puritn
SrsEmrgMkt 21.38
SrsGroCoRetail 17.25
SrsIntlGrw
16.08
10.60
SrsIntlVal
10.45
TotalBond
+0.04
+0.40
+0.57
+0.57
+0.01
+0.31
+1.80
+1.80
...
...
+0.17
+0.57
+0.57
+0.07
-0.15
+0.17
+0.14
+0.10
...
-0.4
1.8
2.0
2.0
-0.8
-1.6
3.4
3.4
-1.4
-1.3
-1.2
0.5
1.7
-0.7
-0.1
3.7
-0.4
-0.8
-1.1
First Eagle Funds
58.10 +0.14
FPA Funds
FPACres
34.21 +0.10
FrankTemp/Frank Adv
2.26 +0.01
IncomeAdv
FrankTemp/Franklin A
CA TF A p
7.28
...
2.28 +0.01
IncomeA p
58.59 +0.10
RisDv A p
FrankTemp/Franklin C
2.31 +0.01
Income C t
FrankTemp/Temp A
GlbA
Net
Sym Close Chg
Stock
PAGP 23.41 0.18 SINOPEC
0.13 LiveNationEnt LYV 37.32 -0.43 PlainsGP
SHI 62.53 0.22 SunTrustBanks STI 67.17 1.19 Travelers
TRV 137.23 -0.02
0.39 LloydsBanking LYG 3.84 0.05 PolarisIndustries PII 120.98 1.70 SK Telecom SKM 24.14 0.07 Symantec SYMC 25.98 -0.02 Trimble
TRMB 34.33 -0.02
POOL 145.48 -0.64 SLGreenRealty SLG 94.45 -0.07 SynchronyFin SYF 33.86 0.05 TurkcellIletism TKC 8.92 -0.18
0.36 LockheedMartin LMT 335.91 1.25 Pool
WABCO
WBC 128.97 -0.15
PX 143.95 0.77 SS&C Tech SSNC 48.41 0.09 Synopsys SNPS 81.75 0.36 TurquoiseHill TRQ 2.92 -0.02 WEC Energy WEC 62.64 -0.40
-0.29 Loews
L
49.63 0.25 Praxair
0.77 LogitechIntl LOGI 35.93 0.05 PrincipalFin PFG 59.63 0.02 SVB Fin
SIVB 237.11 1.05 SynovusFin SNV 48.96 -0.01 21stCenturyFoxA FOXA 35.70 0.01 WEX
WEX 152.55 -0.72
-0.12 LogMeIn
LOGM 114.50 0.60 Procter&Gamble PG 78.16 -0.27 SageTherap SAGE 156.35 15.03 Sysco
SYY 59.85 0.13 21stCenturyFoxB FOX 35.33 -0.01 W.P.Carey WPC 62.04 -0.28
2.22 Lowe's
LOW 85.24 -3.00 Progressive PGR 60.00 -0.04 Salesforce.com CRM 117.19 1.09
Twitter
TWTR 28.01 -0.09 WPP
WPP 83.05 1.91
PLD 61.32 0.08 Sanofi
0.31 lululemon
LULU 89.64 0.03 Prologis
SNY 40.73 0.58
TylerTech TYL 209.09 2.43 Wabtec
WAB 79.95 -0.21
0.02 LyondellBasell LYB 99.43 -1.36 Proofpoint PFPT 118.37 1.18 SantanderCons SC 15.79 -0.04
TAL Education TAL 36.18 1.26 TysonFoods TSN 70.27 0.16 WalgreensBoots WBA 62.85 -0.62
PrudentialFin PRU 101.95 -0.38 Sasol
-0.04
SSL 34.74 0.10
UBS
Group
UBS
17.23
0.14
Walmart
WMT 86.28 -0.41
Prudential PUK 50.16 0.45 Schlumberger SLB 64.26 -0.10 TD Ameritrade AMTD 58.14 0.57 UDR
-0.03
UDR 35.57 -0.14 WasteConnections WCN 72.32 -0.04
TE Connectivity TEL 96.25 0.34
PublicServiceEnt PEG 50.31 0.21 SchwabC
0.45
SCHW
50.21
0.10
UGI 44.27 0.02 WasteMgt WM 83.59 -0.62
M&T Bank MTB 182.84 1.15
Telus
TU 35.43 0.22 UGI
PublicStorage PSA 199.82 0.54 Seagate
-0.01
STX 56.29 -0.33
WAT 198.48 3.60
MGM Resorts MGM 34.37 0.24
TX 34.33 0.08 US Foods USFD 33.25 0.06 Waters
PulteGroup PHM 29.86 -0.17 SealedAir SEE 42.88 0.51 Ternium
-0.47
WSO 184.37 -1.51
USG
USG 39.67 -0.63 Watsco
MKS Instrum MKSI 111.65 1.25
TSU 21.09 -0.40
Qiagen
QGEN 31.41 0.18 SeattleGenetics SGEN 50.20 0.13 TIM Part
0.03
Wayfair
W 67.15 0.51
MPLX
MPLX 32.07 -0.24
TJX 82.61 -0.83 UltaBeauty ULTA 212.15 3.89
Qorvo
QRVO 69.59 -0.13 SemicondctrMfg SMI 6.37 0.09 TJX
-0.49
Weibo
WB
117.14 3.54
UltSoftware
ULTI
239.75
0.66
MSCI
MSCI 146.63 2.58
Qualcomm QCOM 53.43 0.31 SempraEnergy SRE 111.78 0.65 T-MobileUS TMUS 59.74 0.09 t UltraparPart UGP
-0.14
19.92 -0.51 WellCareHealth WCG 192.48 1.48
Macerich
MAC 57.21 -0.14
QuestDiag DGX 97.96 0.61 ServiceCorp SCI 37.68 -0.02 TRowePrice TROW 104.93 0.55
-0.72
WellsFargo
WFC
52.25 0.02
Macy's
M
29.15 -0.65
TableauSftwr DATA 77.82 -0.57 UnderArmour A UAA 16.64 -0.34 Welltower WELL 54.49 -0.52
0.07
ServiceMaster SERV 50.90 0.08
UnderArmour C UA 14.40 -0.35
MadisonSquGarden MSG 245.72 0.60
TaiwanSemi
TSM
43.07
0.65
-0.06
ServiceNow NOW 162.89 -0.05
UN 57.10 -0.20 WestPharmSvcs WST 84.64 1.32
MagellanMid MMP 60.58 0.26
TakeTwoSoftware TTWO 96.51 1.88 Unilever
0.01
RENX 21.35 0.17 ShawComm B SJR 19.35 0.20 Tapestry
UL 56.34 -0.05 WestarEnergy WR 51.49 0.21
MagnaIntl MGA 58.85 0.27 RELX
TPR 52.61 0.14 Unilever
0.33
WestAllianceBcp WAL 56.02 0.04
SherwinWilliams
SHW
389.12
3.41
RELX 21.65 0.16
Manpower MAN 112.94 2.16 RELX
TargaResources
TRGP
44.62 -0.33 UnionPacific UNP 130.02 -0.26 WesternDigital WDC 88.56 0.79
0.11
RPM 47.86 0.76 ShinhanFin SHG 42.09 0.15 Target
ManulifeFin MFC 18.26 0.05 RPM
TGT 71.48 -0.81 UnitedContinental UAL 68.52 -0.11 t WesternGasEquity WGP 32.46 -0.10
0.56
Shire
SHPG
155.86
-0.88
MarathonOil MRO 16.35 0.11 RSP Permian RSPP 41.42 -0.05
UnitedMicro UMC 2.53 -0.03
-0.44
WesternGasPtrs WES 42.00 -0.47
SHOP 118.95 1.53 TataMotors TTM 27.24 -0.10 UPS B
MarathonPetrol MPC 71.67 -0.78 RalphLauren RL 112.47 0.70 Shopify
UPS 104.60 -0.73 WesternUnion WU 18.71 0.06
TechnipFMC FTI 28.43 -0.42
-0.30
Markel
MKL 1148.81 0.65 RandgoldRscs GOLD 79.64 -0.09 SignatureBank SBNY 135.34 -0.68 TeckRscsB TECK 26.14 -0.05 UnitedRentals URI 171.94 -0.20
WestlakeChem WLK 106.17 -1.02
-0.24
SimonProperty
SPG
153.42
-0.68
MarketAxess MKTX 207.81 1.13 RaymondJames RJF 84.83 0.01
US Bancorp USB 50.59 0.31 WestpacBanking WBK 22.28 0.10
1.79
SIRI 6.26
... TelecomArgentina TEO 30.92 -0.04
Marriott
MAR 130.72 -0.21 Raytheon RTN 217.22 1.31 SiriusXM
US Steel
X
34.79 0.30 WestRock WRK 63.00 0.35
TelecomItalia
TI
10.50
-0.05
0.08
51.89 -0.19 SkechersUSA SKX 40.33 0.07
Marsh&McLen MMC 80.62 0.28 RealtyIncome O
TelecomItalia A TI.A 9.02 -0.11 UnitedTech UTX 122.22 -0.54 Weyerhaeuser WY 35.28 -0.20
0.02
RHT 151.33 2.16 Skyworks SWKS 96.02 0.46
MartinMarietta MLM 199.61 -2.61 RedHat
UnitedHealth UNH 222.73 -1.23 WheatonPrecMet WPM 20.59 -0.01
-0.50
AOS 63.00 -0.17 TeledyneTech TDY 186.14 0.57
RegencyCtrs
REG
58.58 -0.12 SmithAO
MarvellTech MRVL 20.60 0.09
Teleflex
TFX 248.26 1.58 UniversalHealthB UHS 119.15 0.65 Whirlpool WHR 146.79 -1.73
-0.59
Masco
MAS 40.22 0.03 RegenPharm REGN 319.70 0.09 Smith&Nephew SNN 37.79 0.34 TelefonicaBras VIV 14.82 -0.25 UnumGroup UNM 46.45 -0.14 Williams
WMB 24.38
...
0.45
SJM 125.11 1.17
Mastercard MA 170.34 0.64 RegionsFin RF 18.38 0.15 Smucker
VEREIT
VER 6.81 -0.04 WilliamsPartners WPZ 33.59 0.02
0.09
SNAP 14.15 -0.10 Telefonica TEF 9.96 0.08
RGA 149.99 0.57 Snap
MatchGroup MTCH 43.42 1.31 ReinsGrp
VF
VFC 76.12 -0.19 WillisTowers WLTW 146.00 -0.15
TelekmIndonesia
TLK
26.97
0.44
0.01
SNA 145.40 -0.56
MaximIntProducts MXIM 56.86 0.05 RelianceSteel RS 83.54 0.51 SnapOn
WIT 5.26 0.08
0.51
Tenaris
TS 35.06 0.26 VICI Prop VICI 18.14 -0.14 Wipro
McCormick MKC 105.42 1.22 RepublicSvcs RSG 66.87 0.02 SOQUIMICH SQM 51.80 0.43
V
118.79 1.09 WooriBank WF 38.43 -0.05
0.51
TER 42.40 -0.28 Visa
Sony
SNE 48.57 0.13 Teradyne
ResMed
RMD
94.65
1.03
McDonalds MCD 161.23 -0.02
WDAY 123.29 0.71
VailResorts
MTN
225.11 1.24 Workday
0.11
Tesla
TSLA
289.66
-9.64
SO 44.77 -0.02
McKesson MCK 140.03 0.32 RestaurantBrands QSR 56.09 0.13 Southern
Vale
VALE 12.50 -0.16 Worldpay WP 80.01 0.17
-0.14
RIO 50.93 0.38 SoCopper SCCO 54.37 -0.35 TevaPharm TEVA 17.13 0.25
Medtronic MDT 78.46 0.82 RioTinto
Wyndham
WYN 109.86 -0.42
-1.36
TexasInstruments TXN 99.81 0.35 ValeroEnergy VLO 96.01 0.83
MelcoResorts MLCO 28.73 0.36 RobertHalf RHI 57.97 0.82 SouthwestAir LUV 54.85 -0.44
0.65
TXT 57.72 -0.15 VarianMed VAR 118.20 0.56 WynnResorts WYNN 180.38 1.89
ROK 169.29 0.33 SpectraEnerPtrs SEP 32.70 -0.20 Textron
MercadoLibre MELI 342.67 0.13 Rockwell
VEDL 17.36
... XPO Logistics XPO 96.86 0.63
0.10
ThermoFisherSci TMO 209.55 3.99 Vedanta
Merck
MRK 56.16 2.80 RockwellCollins COL 133.87 -0.03 SpectrumBrands SPB 97.87 0.01
XcelEnergy XEL 45.51 0.04
-1.94
ThomsonReuters TRI 39.97 0.30 VeevaSystems VEEV 70.55 -0.37
MetLife
MET 45.55 0.28 RogersComm B RCI 45.71 -0.03 SpiritAeroSys SPR 79.35 -1.22
Xerox
XRX 27.53 -0.45
Ventas
VTR
49.81
-0.61
0.07
SPLK 98.01 0.55 ThorIndustries THO 111.99 -0.98
ROL 50.69 0.45 Splunk
MettlerToledo
MTD
560.22 4.96 Rollins
XLNX 66.73 0.43
0.09
VRSN 118.30 0.61 Xilinx
MMM 212.81 0.56 VeriSign
SPOT 150.00 2.08 3M
Xylem
XYL 75.71 0.31
MichaelKors
KORS
64.27 -0.59 RoperTech ROP 268.08 0.24 Spotify
0.46
Tiffany
TIF 96.06 0.48 VeriskAnalytics VRSK 104.77 0.64
Sprint
S
5.14
-0.01
RossStores
ROST
76.94
-0.51
YPF
YPF 21.31 0.18
MicroFocus MFGP 16.27 0.62
-0.27
VZ 46.92 0.03
SQ 45.89 0.02 TimeWarner TWX 95.49 0.37 Verizon
YY
YY 100.73 2.61
MicrochipTech MCHP 86.20 -0.07 RoyalBkCanada RY 77.16 0.89 Square
-0.21
Toll Bros
TOL 43.03 -0.16 VertxPharm VRTX 156.76 2.51 Yandex
YNDX 34.66 -4.73
MicronTech
MU
47.96 -0.50 RoyalBkScotland RBS 7.45 0.04 StanleyBlackDck SWK 149.53 -0.14
-1.26
Torchmark TMK 83.15 0.17 Viacom A VIA 36.20 0.70 YumBrands YUM 84.45 -0.01
Starbucks
SBUX
58.70
0.36
RoyalCaribbean
RCL
115.13
0.30
Microsemi MSCC 63.02 -0.66
0.24
TTC 59.93 -0.58 Viacom B VIAB 30.97 0.07 YumChina YUMC 39.23 0.68
RoyalDutchA RDS.A 66.53 0.73 StateStreet STT 98.30 0.81 Toro
Microsoft
MSFT
90.77
0.54
-0.02
VIPS 16.68 -0.02 ZTO Express ZTO 14.96 0.06
STO 24.65 0.38 TorontoDomBk TD 55.87 0.52 Vipshop
RoyalDutchB RDS.B 68.14 0.88 s Statoil
1.27 MidAmApt MAA 91.89 -0.09 RoyalGold RGLD 85.52 -0.66 SteelDynamics STLD 43.68 0.20 Total
TOT 59.38 -0.03 s VirtuFinancial VIRT 36.05 0.35 ZayoGroup ZAYO 35.64 -0.64
MIDD 123.33 -0.24
-0.72 Middleby
Ryanair
RYAAY 123.41 1.15 STMicroelec STM 21.13 0.15 TotalSystem TSS 84.58 0.60 VistraEnergy VST 20.83 1.15 ZebraTech ZBRA 136.15 0.71
0.06 MitsubishiUFJ MUFG 6.52 0.07 SAP
VMW 120.47 1.82 Zillow A
SYK 157.05 1.88 ToyotaMotor TM 126.17 0.80 VMware
SAP 107.17 1.81 Stryker
ZG 51.97 -0.68
0.83 MizuhoFin MFG 3.63 0.08 S&P Global SPGI 187.77 0.45 SumitomoMits SMFG 8.36 0.08 TractorSupply TSCO 59.40 -0.30 Vodafone
VOD 28.95 0.13 Zillow C
Z
51.74 -0.94
-0.23 MobileTeleSys MBT 9.62 -1.38 SBA Comm SBAC 171.58 1.85 SunComms SUI 90.58 -0.54 TransCanada TRP 41.77 0.30 VornadoRealty VNO 66.61 -0.13
ZimmerBiomet ZBH 106.20 1.02
MohawkInds
MHK
235.37
-0.71
0.17
SEI Investments SEIC 72.04 -0.74 SunLifeFinancial SLF 40.73 0.40 TransDigm TDG 303.20 -3.16 VoyaFinancial VOYA 49.69 0.17 ZionsBancorp ZION 51.63 0.19
1.66 MolsonCoors B TAP 73.18 0.02 Sina
SINA 97.52 0.84 SuncorEnergy SU 36.20 0.09 TransUnion TRU 56.28 0.10 VulcanMatls VMC 112.91 -0.65 Zoetis
ZTS 81.87 0.90
MOMO 36.79 0.39
0.13 Momo
Mondelez
MDLZ
41.68
0.20
1.57
-0.07 s Monsanto MON 125.15 7.29
0.09 MonsterBev MNST 56.23 0.30
52-Wk %
52-Wk %
MCO 159.46 0.47
Stock
Sym Hi/Lo Chg Stock
Sym Hi/Lo Chg
-0.05 Moody's
0.43 MorganStanley MS 53.35 0.31
13.46 -4.0 NiaMoPwr pfC NMKpC 94.40 0.4
CrossTimbers CRT
MOS 24.49 0.27
0.63 Mosaic
The following explanations apply to the New York Stock Exchange, NYSE Arca, NYSE
3.49 -2.8
1.25 -7.1 OceanBioChem OBCI
Digirad
DRAD
... MotorolaSol MSI 104.71 0.73 American and Nasdaq Stock Market stocks that hit a new 52-week intraday high or low
2.00 -1.5
ODP
1.26 -6.7 OfficeDepot
DvsfdRestaurant SAUC
MuleSoft
MULE
44.16
0.15
-0.36
in the latest session. % CHG-Daily percentage change from the previous trading session.
0.49 -6.1
ParkerDrilling
PKD
45.72
0.7
DominionEnerUn
DCUD
MYL 39.85 0.33
1.98 Mylan
0.47 -5.9
66.05 0.2 PetroQuestEner PQ
DominionEner D
NRG
Energy
NRG
30.53
0.57
0.47
Monday, April 9, 2018
45.20
-0.5
ProAssurance
PRA
14.20 -3.0
DominionEnerMid DM
-0.01 s NTTDoCoMo DCM 26.27 0.17
10.00 -8.6
Qudian
QD
52-Wk %
52-Wk %
52-Wk % EVINE Live
0.88
-4.6
EVLV
NVR 3116.44 -5.56
2.01 NVR
Stock
Sym Hi/Lo Chg Stock
Sym Hi/Lo Chg Stock
Sym Hi/Lo Chg EssaPharma EPIX
REVG 19.53 -2.8
0.10 -3.0 REV
0.04 NXP Semi NXPI 114.34 0.61
16.70 -2.6
RES
FARM 28.60 -4.2 RPC
7.50 -2.5 Altimmune
ManhattanBridge LOAN
0.85 -4.8 FarmerBros
ALT
NDAQ 85.29 0.09
1.34 Nasdaq
6.88 -2.0
FedAgricMtgPfdC AGMpC 26.26 -1.0 RangerEnergySvcs RNGR
126.80
6.2
Monsanto
MON
0.80
-1.7
AmElecTch
AETI
-0.23 NationalGrid NGG 58.96 0.90
7.82 -5.4
resTORbio
TORC
7.08 -7.8
2.75 1.7 AmShrHosp
NII Holdings
NIHD
2.25 -2.1 FranklinStProp FSP
AMS
27.86 ...
1.22 -2.3
SCYNEXIS
SCYX
-0.43 NatlInstruments NATI 48.31 0.37 Abercrombie&Fitch ANF
0.07
-15.6
GabelliUtilityRt
GUTr
26.33 0.7 AnavexLifeSci AVXL
NTTDoCoMo DCM
2.25 -3.4
NatlOilwell
NOV
36.25
-0.74
25.26
0.2
AllstatePfdG
ALLpG
1.85 ...
ScorpioTankers STNG
0.54
NatlEnerSvs
NESR 10.35 0.2 AnteroMidstream AM
24.20 -1.6 GatesIndustrial GTES 16.38 -2.6
21.43 0.2
AEO
scPharm
SCPH 10.52 -0.8
0.76 NatlRetailProp NNN 39.09 -0.27 AmerEagle
2.66 -2.2
GNW
4.31 2.3 ArchCapital
NewYork
NWY
ACGL 80.01 -5.9 GenworthFin
AVXS 211.75 81.6
3.66 -5.0
Sibanye-Stillwater SBGL
-0.09 NektarTherap NKTR 104.45 10.58 AveXis
24.60
0.4
GladstonePfd2024
54.49 ... ArcusBiosci
PJT Partners PJT
GLADN
13.30
-4.5
RCUS
7.83 3.8
BLFS
NTAP 63.58 0.47 BioLifeSols
1.26 -13.6
SigmaLabs
SGLB
0.27 NetApp
1.48 17.1 AstaFunding
PalatinTech
PTN
11.87 -3.3
3.30 -1.5 GovtPropIncoTr GOV
ASFI
8.90 2.2
CDNA
5.05 -0.9
Smart&FinalStores SFS
NTES 280.51 7.77 CareDx
0.32 Netease
PhibroAnimal PAHC 43.15 -2.3 Atento
7.55 -1.9 GreenlightCapRe GLRE 15.00 0.3
ATTO
25.22
3.6
Carvana
CVNA
1.60 -3.3
Soligenix
SNGX
NFLX 289.93 1.08
2.12 Netflix
10.00 -0.2 AurisMedical
QuorumHealth QHC
11.82 -3.2
1.22 -4.3 GreentreeHospital GHG
EARS
93.47 1.9
ChinaPetrol
SNP
SteelPtrsPfdA
SPLPpA 20.30 -0.2
Neurocrine
NBIX
79.18
2.33
0.54
75.30 -1.4 AxovantSciences AXON
RMR Group
RMR
HSEA 26.22 -0.3
1.14 -2.6 HSBCPfd
39.13
1.2
ChunghwaTel
CHT
SummitMidstream SMLP 13.10 -3.3
-0.18 NewOrientalEduc EDU 91.60 2.88
RadNet
RDNT 14.85 -0.7 BP Midstream BPMP 16.83 1.4 HavertyFurn
18.00 -5.0
HVT
CitiTrends
CTRN 32.49 ...
93.87 1.2
Synnex
SNX
4.00 1.3 BRF
Senseonics
SENS
0.09 NY CmntyBcp NYCB 12.55 -0.01
6.25 -5.6 HudbayMineralsWt HBM.WS 0.04 -14.9 TESARO
BRFS
2.92 2.2
DenburyRscs DNR
TSRO 50.67 -5.3
NewellBrands
NWL
25.52
-0.27
24.87
1.6
Statoil
STO
2.10
61.30 2.1
INCY
2.00 -5.1 Incyte
BlinkCharging BLNK
Denny's
DENN 16.39 -1.4
22.20 -4.3
TheravanceBio
TBPH
8.60 -0.6 BlueknightEnPtrsA BKEPP 7.00 -0.6 InfoSonics
TownSports
CLUB
9.10 NewmontMin NEM 38.58 -0.71 Durect
4.22 3.0
IFON
2.52 5.1
DRRX
1.81 -6.7
USAutoPartsNtwk PRTS
10.70 1.2 CDTI AdvMat CDTI
Ultralife
ULBI
-0.04 NewsCorp B NWS 15.85 0.05 FRONTEO
5.75 -10.9 US Concrete
INTT
0.72 -8.4 inTEST
FTEO 17.98 7.5
USCR 58.10 -1.3
0.39 NewsCorp A NWSA 15.65 0.15 FennecPharm FENC 14.99 1.8 UrbanOutfitters URBN 39.15 -1.7 CPI Card
0.33 -30.3 UltraparPart
NVIV
2.45 -3.5 InVivoTherap
PMTS
19.88 -2.5
UGP
UsanaHealth USNA 94.90 0.5 CelldexTherap CLDX
-0.21 NextEraEnergy NEE 162.13 -0.62 Fortinet
1.97 4.0 JerniganCapPfdB JCAPpB 23.00 -0.4 VEON
FTNT 55.46 0.3
2.20 -17.9
VEON
NKE 67.18 -0.37 GCI Liberty PfdA GLIBP 24.24 1.9 VillageSuper A VLGEA 27.96 2.6 CellectarBioWtA CLRBZ 0.37 0.3 JohnsonControls JCI
33.23 -1.1 VeriFoneSystems PAY
0.13 Nike
14.90 -1.1
36.84 1.0 CescaTherap
VirtuFinancial
VIRT
NiSource
NI
24.15
-0.10
1.45 -12.7 KimcoRealtyPfdK KIMpK 22.90 -1.2 Versartis
KOOL
-0.51
GDL Fd PfdC GDLpC 51.49 0.7
1.50 1.6
VSAR
NobleEnergy NBL 29.72 0.46 GOL Linhas
11.48 -3.1 VictoryCapital VCTR 10.52 -1.8
4.06 ... LutherBurbank LBC
ChinaXDPlastics CXDC
14.49 -5.7
GOL
Nokia
NOK 5.41 0.02 Genprex
38.60 -1.1 VornadoPfdM VNOpM 22.52 -0.7
LXFT
3.70 -2.6 Luxoft
CidaraTherap CDTX
6.23 -7.3
GNPX
NomuraHoldings NMR 5.78 0.03 GriffinIndlRealty GRIF 37.94 0.2 ABMIndustries ABM 32.08 -1.5 CirrusLogic
3.35 -20.9 vTvTherap
MTL
CRUS 37.47 -2.7 Mechel
3.22 -4.7
VTVT
0.84 Nordson
NDSN 132.30 0.92 Guess
6.50 -3.6 WRBerkleyDeb58 WRBpE 24.31 -0.1
CLDR 12.72 -1.8 MelintaTherap MLNT
23.29 0.5 ACADIA Pharm ACAD 15.74 -23.4 Cloudera
GES
1.31 Nordstrom JWN 48.03
7.94 -76.8 WesternGasEquity WGP
... HollyFrontier HFC
MNLO
COHR 172.76 -1.2 MenloTherap
6.45 -2.7 Coherent
53.65 1.2 ASV
ASV
31.63 -0.3
0.11 NorfolkSouthern NSC
3.57 -3.8 WestmorelandRes WMLP 1.55 -8.8
29.94 -1.3 MonakerGroup MKGI
CFX
128.92 -0.44 HoustonWire HWCC 8.30 3.2 Aceto
6.85 -5.3 Colfax
ACET
0.31
3.26 0.9 WideOpenWest WOW
63.07 0.8 ADDvantage
1.25 -1.6 CompassPfdA CODIpA 21.70 -0.6 NaviosMaritimeMid NAP
6.71 -0.9
AEY
NorthernTrust NTRS 102.03 0.86 LambWeston LW
0.09
3.77 -8.1 YogaWorks
NewLinkGenetics
22.58
-1.2
CompassPfd
NLNK
110.40
0.2
16.50
-1.5
CODIpB
1.98 -3.6
MagellanHealth
AllianceResource
MGLN
ARLP
YOGA
NorthropGrum NOC 347.59 -4.13
-0.04
NorwegCruise NCLH 53.03 -0.18
0.95
Novartis
NVS 81.07 0.87
-0.47
NovoNordisk NVO 49.74 1.17
1.38
Amount
Nucor
NUE 60.54 -0.15
Payable /
-0.38
Company
Symbol Yld % New/Old Frq
Nutanix
NTNX 49.53 -0.31
Record
1.66
Nutrien
NTR 46.24 1.29
0.01
Stocks
NVIDIA
NVDA 215.41 1.16
0.09
HEAR
Turtle Beach
1:4
/Apr09
Amount
Payable /
-1.45
Company
Symbol Yld % New/Old Frq
Record
...
Foreign
-0.28 OGE Energy OGE 32.07 0.03
BSAC
Banco Santander ADR
3.1 1.48603
/Apr19
OKE 56.75 0.06 Increased
0.12 ONEOK
CHA 3.3 1.46506 A
Aug06 /May31
GJO 2.9 .0547 /.04872 M
Apr16 /Apr13 China Telecom ADR
0.24 OReillyAuto ORLY 232.28 -4.91 4.65% Fltg. Rate STRATS
CIG
Energ
Gerais-Cemig
ADR
.14953
/May03
GBX 2.2
.25 /.23 Q May16 /Apr25
0.24 OccidentalPetrol OXY 68.93 1.40 Greenbrier Cos
.00914
/May03
MVO 15.7 .365 /.22 Q
Apr25 /Apr16 Energ Gerais-Cemig ADR C CIG.C
0.10 OldDomFreight ODFL 140.17 -0.67 MV Oil Trust
GJP 3.5 .0637 /.05753 M
Apr16 /Apr13
0.72 OldRepublic ORI 21.10 -0.21 STRATS Dom Res Ser 05-06
OMC 71.62 -0.12
-0.42 Omnicom
KEY: A: annual; M: monthly; Q: quarterly; r: revised; SA: semiannual;
ON 23.56 0.14 Reduced
-0.24 ON Semi
OTEX 34.54 0.38 Franklin St Properties
FSP 4.7
.09 /.19 Q May10 /Apr20 S2:1: stock split and ratio; SO: spin-off.
-0.06 OpenText
ORCL 44.90 0.07
-0.07 Oracle
ORAN 17.35 0.21
-0.88 Orange
-0.57 OrbitalATK OA 132.78 0.11
IX
86.54 0.35
0.40 Orix
OSK 75.59 -0.43
0.14 Oshkosh
0.11 OwensCorning OC 79.67 -1.22
Closing Chg YTD
PCG 44.43 0.46
-0.23 PG&E
Largest 100 exchange-traded funds, latest session
ETF
Symbol Price (%) (%)
PHI 28.30 -0.17
0.67 PLDT
SchwabUS SC
SCHA 68.46
0.04 –1.8
PNC 149.21 1.26
0.03 PNC Fin
Closing Chg YTD
Monday, April 9, 2018
SPDR DJIA Tr
DIA 239.73
0.25 –3.1
PKX 73.05 -1.56
ETF
Symbol Price (%) (%)
-0.14 POSCO
Closing Chg YTD
SPDR
S&PMdCpTr
MDY
337.21
0.05 –2.4
PPG 109.61 0.22 ETF
0.40 PPG Ind
Symbol Price (%) (%)
iShMSCI EAFE SC
SCZ
65.11
0.9
0.60
SPDR S&P 500
SPY 261.00
0.49 –2.2
PPL 28.15 0.22
0.17 PPL
iShMSCIEmgMarkets
EEM
47.13
0.0
0.11
SPDR
S&P
Div
SDY
90.57
–4.1
–0.01
AMLP
9.37
0.21 –13.2
PTC 77.92 0.98 AlerianMLPETF
-0.07 PTC
iShMSCIEurozone
EZU 43.85
1.1
0.80
TechSelectSector
XLK 64.55
0.9
0.78
CnsmrDiscSelSector
XLY
100.44
1.8
–0.24
PVH 155.59 -1.14
0.89 PVH
iShMSCIJapan
EWJ
60.15
0.4
0.89
UtilitiesSelSector
XLU
50.52
–4.1
0.20
XLP
52.39 –0.06 –7.9
PCAR 65.53 -0.73 CnsStapleSelSector
0.99 Paccar
iShNasdaqBiotech
IBB 102.87
1.82 –3.7
VanEckGoldMiner
GDX 21.98 –0.41 –5.4
EnSelectSectorSPDR
XLE
67.67
–6.4
0.48
2.47 PackagingCpAm PKG 111.04 0.90
iShNatlMuniBd
MUB 108.50 –0.04 –2.0
VangdInfoTech
VGT 168.34
2.2
0.68
FinSelSectorSPDR
XLF
27.32
0.55 –2.1
0.03 PacWestBancorp PACW 47.42 -0.29
iShRussell1000Gwth IWF 134.34
0.30 –0.3
VangdSC Val
VBR 127.97 –0.21 –3.6
HealthCareSelSect
XLV 80.67
0.99 –2.4
0.51 PagSeguroDig PAGS 35.17 -0.54
iShRussell1000
IWB 145.30
0.35 –2.2
VangdSC Grwth
VBK 161.37
0.3
0.25
IndSelSectorSPDR
XLI
72.55 –0.30 –4.1
0.66 PaloAltoNtwks PANW 187.92 -5.92
iShRussell1000Val
IWD 118.98
0.41 –4.3
VangdDivApp
VIG
99.71
0.11 –2.3
iShIntermCredBd
CIU 107.04
0.05 –2.0
iShRussell2000Gwth IWO 188.68
-0.25 ParkerHannifin PH 167.23 -0.21
1.1
0.37
VangdFTSEDevMk
VEA 44.38
0.86 –1.1
iSh1-3YCreditBond
CSJ 103.86
0.03 –0.7
iShRussell2000
IWM 150.54
0.12 –1.3
-0.04 ParsleyEnergy PE 26.65 -0.30
VangdFTSE EM
VWO 46.12 –0.09 0.5
iSh3-7YTreasuryBd
IEI
120.42 –0.01 –1.4
iShRussell2000Val
IWN 121.01 –0.33 –3.8
PAYX 60.94 0.22
VangdFTSE Europe
VGK 58.70
0.77 –0.8
-0.11 Paychex
iShCoreMSCIEAFE
IEFA 66.05
0.93 –0.1
iShRussell3000
IWV
154.70
–2.2
0.33
VangdFinls
VFH 68.66
0.31 –2.0
-0.08 PaycomSoftware PAYC 107.79 0.61
iShCoreMSCIEmgMk IEMG 57.10
0.4
0.14
iShRussellMid-Cap
IWR 203.44
0.14 –2.3
VangdFTSEAWxUS
VEU 54.24
0.67 –0.9
PYPL 75.19 1.33 iShCoreMSCITotInt
-0.80 PayPal
IXUS 62.86
0.64 –0.3
iShRussellMCValue
IWS 85.50
0.06 –4.1
VangdGrowth
VUG 139.88
0.34 –0.5
PSO 10.52 0.16 iShCoreS&P500
-0.45 Pearson
IVV 262.70
0.43 –2.3
iShS&PMC400Growth
IJK
215.32
–0.2
0.10
VangdHlthCr
VHT
151.80
1.06 –1.5
-0.84 PembinaPipeline PBA 30.91 0.38 iShCoreS&P MC
IJH 185.12
0.06 –2.5
iShS&P500Growth
IVW 153.13
0.2
0.49
VangdHiDiv
VYM 81.89
0.38 –4.4
PNR 68.43 0.35 iShCoreS&P SC
2.52 Pentair
IJR
76.56 –0.26 –0.3
iShS&P500Value
IVE
108.56
–5.0
0.31
VangdIntermBd
BIV
81.64
–2.6
0.07
0.57 People'sUtdFin PBCT 18.35 -0.04 iShS&PTotlUSStkMkt ITOT 59.78
0.27 –2.2
iShUSPfdStk
PFF
37.24
0.11 –2.2
VangdIntrCorpBd
VCIT 84.62
0.06 –3.2
PEP 109.38 0.08 iShCoreUSAggBd
0.74 PepsiCo
AGG 107.00
0.08 –2.1
iShShortTreaBd
SHV 110.29
0.0
0.02
VangdLC
VV 119.95
0.38 –2.1
-0.06 PerkinElmer PKI 74.15 0.95 iShSelectDividend
DVY 94.80
0.11 –3.8
iShTIPSBondETF
TIP 112.85 –0.02 –1.1
VangdMC
VO 152.04
0.18 –1.8
PRGO 82.89 0.90 iShEdgeMSCIMinEAFE EFAV 74.22
-0.07 Perrigo
1.7
1.02
iSh1-3YTreasuryBd
SHY 83.48 –0.01 –0.4
VangdMC Val
VOE 108.45
0.07 –2.8
0.25 PetroChina PTR 68.96 1.11 iShEdgeMSCIMinUSA USMV 51.67
0.35 –2.1
iSh7-10YTreasuryBd IEF 102.94
0.02 –2.5
VangdRealEst
VNQ 75.03 –0.32 –9.6
-0.35 PetroleoBrasil PBR 13.38 -0.54 iShEdgeMSCIUSAMom MTUM 103.55
0.4
0.42
iShRussellMCGrowth IWP 120.52
0.21 –0.1
VangdS&P500
VOO 239.59
0.41 –2.3
-0.26 PetroleoBrasilA PBR.A 12.01 -0.62 iShFloatingRateBd
FLOT 50.89
0.1
...
PIMCOEnhShMaturity MINT 101.46 –0.01 –0.1
VangdST Bond
BSV 78.37
0.01 –0.9
PFE 35.46 0.29 iShGoldTr
-0.39 Pfizer
IAU
12.84
2.6
0.23
PwrShQQQ 1
QQQ 157.73
1.3
0.70
VangdSTCpBd
VCSH 78.38
0.03 –1.2
-0.37 PhilipMorris PM 100.70 -0.32 iShiBoxx$InvGrCpBd LQD 117.13
0.05 –3.6
PwrShSrLoanPtf
BKLN 23.11
0.3
0.04
VangdSC
VB
145.01
0.01 –1.9
PSX 97.74 0.77 iShiBoxx$HYCpBd
0.04 Phillips66
HYG 85.59
0.38 –1.9
SPDR BlmBarcHYBd JNK
35.87
0.36 –2.3
VangdTotalBd
BND 79.80
0.10 –2.2
EMB 112.46 –0.10 –3.1
0.08 PilgrimPride PPC 23.70 -0.02 iShJPMUSDEmgBd
SPDR Gold
GLD 126.82
2.6
VangdTotIntlBd
BNDX 54.69
0.34
0.6
0.02
MBB 104.45
0.06 –2.0
-0.10 PinnacleFoods PF 54.62 0.13 iShMBSETF
SchwabIntEquity
SCHF 33.79
VangdTotIntlStk
VXUS 56.48
0.90 –0.8
0.75 –0.6
ACWI 71.19
0.52 –1.2
SchwabUS BrdMkt
SCHB 63.15
VangdTotalStk
VTI 134.32
0.49 PinnacleWest PNW 79.70 -0.05 iShMSCI ACWI
0.30 –2.1
0.34 –2.1
EWZ 41.98 –3.32 3.8
SchwabUS Div
SCHD 48.37
VangdTotlWrld
VT
73.15
0.02 –5.5
0.61 –1.5
-0.14 PioneerNatRscs PXD 169.35 1.22 iShMSCIBrazil
EFA 69.97
SchwabUS LC
SCHX 62.42
0.82 –0.5
VangdValue
VTV 102.43
0.35 –2.1
0.37 –3.7
-0.31 PlainsAllAmPipe PAA 23.26 0.28 iShMSCI EAFE
Fidelity Invest
Net YTD
NAV Chg % Ret
13.53 +0.01
45.21 +0.15
Intl Stk
195.49 +1.00
... -2.8 Stock
... -1.1 DoubleLine Funds
NA
...
+0.01 -0.3 TotRetBdI
... 0.4 Edgewood Growth Instituti
EdgewoodGrInst 30.90 +0.16
... -1.4 Federated Instl
5.77 +0.02
StraValDivIS
... -0.4 Fidelity
91.33 +0.34
-0.03 1.2 500IdxInst
+0.06 0.8 500IdxInstPrem 91.32 +0.33
+0.09 -0.8 500IdxPrem 91.32 +0.33
+0.12 -1.0 ExtMktIdxPrem r 61.35 -0.02
+0.10 -0.3 IntlIdxPrem r 43.06 +0.42
+0.07 -2.3 SAIUSLgCpIndxFd 14.03 +0.05
75.12 +0.22
+0.04 -1.6 TMktIdxF r
+0.03 -2.1 TMktIdxPrem 75.11 +0.22
...
-0.08 -2.3 USBdIdxInstPrem 11.34
-0.08 -3.0 Fidelity Advisor I
31.79 +0.15
-0.05 -3.1 NwInsghtI
+0.14 -3.2 Fidelity Freedom
FF2020
16.45 +0.04
14.30 +0.05
+0.35 -2.0 FF2025
17.92 +0.06
+0.04 -3.1 FF2030
Net
Sym Close Chg
Stock
-1.6
-1.4
-2.5
-1.7
-2.5
-4.0
-2.7
GlBond A p
Growth A p
Net YTD
NAV Chg % Ret Fund
11.94 -0.06
26.57 +0.12
FrankTemp/Temp Adv
GlBondAdv p 11.89 -0.06
Harbor Funds
CapApInst
71.30 +0.37
IntlInst r
67.59 +0.50
Harding Loevner
NA
...
IntlEq
Invesco Funds A
10.66 +0.03
EqIncA
John Hancock Class 1
15.04 +0.03
LSBalncd
15.98 +0.05
LSGwth
John Hancock Instl
22.85 +0.03
DispValMCI
JPMorgan Funds
39.10 +0.01
MdCpVal L
JPMorgan R Class
CoreBond
11.38 +0.01
Lazard Instl
19.81 -0.28
EmgMktEq
Lord Abbett A
...
ShtDurIncmA p 4.21
Lord Abbett F
4.20
...
ShtDurIncm
Metropolitan West
10.45
...
TotRetBd
10.45
...
TotRetBdI
9.83 -0.01
TRBdPlan
MFS Funds Class I
39.19 +0.16
ValueI
MFS Funds Instl
IntlEq
25.32 +0.22
Mutual Series
31.10 +0.16
GlbDiscA
Oakmark Funds Invest
31.59 +0.02
EqtyInc r
Net YTD
NAV Chg % Ret Fund
1.1 Oakmark
83.07
-2.5 OakmrkInt
27.87
Old Westbury Fds
1.1 LrgCpStr
14.34
Oppenheimer Y
2.7 DevMktY
43.62
0.1 IntGrowY
43.62
Parnassus Fds
NA ParnEqFd
42.08
PIMCO Fds Instl
-2.4 AllAsset
NA
TotRt
10.08
-0.7 PIMCO Funds A
-0.6 IncomeFd
NA
PIMCO Funds Instl
-2.0 IncomeFd
NA
PIMCO Funds P
-2.9 IncomeP
NA
Price Funds
-1.1 BlChip
100.13
28.28
CapApp
-1.0 EqInc
32.28
70.15
EqIndex
0.1 Growth
64.12
HelSci
70.03
-0.1 InstlCapG
38.23
18.67
IntlStk
-1.4 IntlValEq
14.97
-1.3 MCapGro
88.51
-1.3 MCapVal
30.05
54.95
N Horiz
-3.6 N Inc
9.29
11.31
OverS SF r
-0.5 R2020
22.42
NA
R2025
-2.2 R2030
25.80
NA
R2035
-1.9 R2040
27.14
Net YTD
NAV Chg % Ret Fund
36.22 +0.16
+0.36 -1.5 Value
+0.14 -2.5 PRIMECAP Odyssey Fds
AggGrowth r 47.95 +0.65
39.07 +0.38
+0.06 -0.8 Growth r
Principal Investors
13.73 +0.04
-0.38 1.6 DivIntlInst
+0.29
... Prudential Cl Z & I
14.24
...
TRBdZ
+0.10 -1.0 Schwab Funds
40.47 +0.15
S&P Sel
... NA TIAA/CREF Funds
19.32 +0.06
EqIdxInst
... -1.2
IntlEqIdxInst 20.12 +0.17
Tweedy Browne Fds
... NA
GblValue
28.17 +0.09
VANGUARD ADMIRAL
... NA
500Adml
241.39 +0.88
34.03 +0.07
BalAdml
... NA
11.57
...
CAITAdml
CapOpAdml r 152.34 +0.69
+0.46 4.0
38.39
...
EMAdmr
+0.08
...
75.11 +0.27
EqIncAdml
+0.09 -2.8 ExplrAdml
90.79 +0.06
+0.26 -1.8 ExtndAdml
83.56 -0.02
+0.25 2.3 GNMAAdml
10.27
...
+1.16 -0.5 GrwthAdml
72.01 +0.25
+0.18 3.6 HlthCareAdml r 83.28 +0.71
+0.12
... HYCorAdml r
5.77
...
+0.09 -1.0 InfProAd
25.32 +0.02
+0.24 1.7 IntlGrAdml
98.12 +0.93
+0.11 -1.2 ITBondAdml 11.06
...
+0.25 4.5 ITIGradeAdml 9.50
...
... -1.4 LTGradeAdml 10.04 +0.01
+0.08
... MidCpAdml 188.33 +0.33
+0.06 -0.5 MuHYAdml
11.20 -0.01
... NA MuIntAdml
13.86
...
11.39 -0.01
+0.07 -0.5 MuLTAdml
10.81
...
MuLtdAdml
... NA
15.69
...
+0.09 -0.4 MuShtAdml
Net YTD
NAV Chg % Ret Fund
-2.9 PrmcpAdml r 133.15
RealEstatAdml 106.30
8.2 SmCapAdml 69.50
4.9 STBondAdml 10.28
STIGradeAdml 10.51
-1.2 TotBdAdml
10.52
TotIntBdIdxAdm 21.84
-1.5 TotIntlAdmIdx r 30.31
TotStAdml
65.36
-1.7 TxMIn r
14.25
39.95
ValAdml
-1.7 WdsrllAdml
64.95
-0.2 WellsIAdml
63.26
70.54
WelltnAdml
-1.1
77.81
WndsrAdml
VANGUARD FDS
-1.8
25.91
DivdGro
-1.5
197.49
HlthCare r
-1.1
INSTTRF2020 22.33
-0.8
0.7 INSTTRF2025 22.65
-3.1 INSTTRF2030 22.89
2.7 INSTTRF2035 23.14
-1.1 INSTTRF2040 23.37
-1.0 INSTTRF2045 23.54
39.57
-0.2 IntlVal
19.72
-1.5 LifeCon
33.32
LifeGro
-1.2
26.89
-0.8 LifeMod
26.40
2.7 PrmcpCor
29.50
-1.9 SelValu r
26.61
-1.8 STAR
10.51
-4.3 STIGrade
-1.4 TgtRe2015
15.21
-1.1 TgtRe2020
31.11
-1.2 TgtRe2025
18.32
-1.5 TgtRe2030
33.30
-0.3 TgtRe2035
20.47
0.2 TgtRe2040
35.39
+0.53
-0.33
+0.01
...
...
+0.01
+0.01
+0.20
+0.20
+0.11
+0.14
+0.22
+0.14
+0.22
+0.30
-0.3
-8.7
-1.5
-0.5
-0.5
-1.4
0.9
-0.4
-1.6
-0.7
-3.0
-3.2
-2.5
-2.2
-1.5
+0.06
+1.69
+0.05
+0.07
+0.07
+0.08
+0.08
+0.09
+0.25
+0.04
+0.12
+0.07
+0.10
-0.03
+0.08
...
+0.03
+0.08
+0.05
+0.11
+0.07
+0.13
-1.3
-1.5
-0.9
-0.9
-1.0
-1.0
-1.1
-1.1
-0.8
-0.9
-1.0
-0.9
-1.9
-5.7
-0.7
-0.5
-0.8
-0.9
-1.0
-1.0
-1.1
-1.1
TgtRe2045
TgtRe2050
TgtRetInc
TotIntBdIxInv
WellsI
Welltn
WndsrII
Net YTD
NAV Chg % Ret
22.25 +0.09
35.80 +0.14
13.42 +0.02
10.92
...
26.12 +0.06
40.85 +0.13
36.60 +0.12
VANGUARD INDEX FDS
241.38 +0.87
500
206.21 -0.04
ExtndIstPl
54.99 -0.11
SmValAdml
TotBd2
10.48
...
18.12 +0.12
TotIntl
65.33 +0.19
TotSt
VANGUARD INSTL FDS
34.03 +0.06
BalInst
DevMktsIndInst 14.27 +0.11
DevMktsInxInst 22.31 +0.18
83.56 -0.01
ExtndInst
72.01 +0.25
GrwthInst
InPrSeIn
10.31
...
238.24 +0.86
InstIdx
238.26 +0.87
InstPlus
58.10 +0.17
InstTStPlus
MidCpInst
41.60 +0.07
205.18 +0.36
MidCpIstPl
SmCapInst
69.49
...
...
SmCapIstPl 200.59
STIGradeInst 10.51
...
10.52 +0.01
TotBdInst
TotBdInst2
10.48
...
10.52 +0.01
TotBdInstPl
...
TotIntBdIdxInst 32.76
TotIntlInstIdx r 121.19 +0.78
TotItlInstPlId r 121.21 +0.78
65.37 +0.19
TotStInst
ValueInst
39.95 +0.14
Western Asset
CorePlusBdI 11.59 -0.01
-1.1
-1.1
-0.6
0.9
-2.5
-2.3
-3.3
-1.8
-1.1
-3.1
-1.6
-0.4
-1.7
-1.5
-0.7
-0.7
-1.1
-0.2
-0.8
-1.8
-1.7
-1.6
-1.4
-1.4
-1.5
-1.5
-0.4
-1.4
-1.5
-1.4
0.9
-0.4
-0.4
-1.6
-3.0
-1.3
.
B12 | Tuesday, April 10, 2018
THE WALL STREET JOURNAL.
* *
BANKING & FINANCE
Eurozone’s Private-Sector Debt Swells
A lending spree lifts
region’s leverage so
high that regulators
are becoming worried
BY PATRICIA KOWSMANN
AND TOM FAIRLESS
LISBON—Filipe Garcia e
Costa had never borrowed
from a bank when ultralow interest rates tempted him to
take out a €185,000 ($226,000)
loan to buy an apartment here.
The caveat: The 32-yearold real-estate manager won’t
finish repaying the debt—
worth seven times his annual
salary—until he is 75.
Mr. Garcia e Costa isn’t
alone in ramping up debt.
Across the eurozone, economic
optimism, ultralow interest
rates and fierce competition
among banks have helped
push private-sector lending to
its highest level since the financial crisis. That would be
good news if it wasn’t for one
big problem: the region’s already high debt.
Over the past decade, the
debt held at eurozone firms
and households rose around 12
percentage points to 160% of
gross domestic product, according to data from the Bank
for
International
Settlements. In the same 10-year period, U.S. private-sector debt
fell around 14 percentage
points, to 152% of GDP.
The borrowing binge is seen
as one adverse effect of almost
a decade of easy money from
the European Central Bank,
which slashed interest rates
below zero and bought bonds
to reignite an economy reeling
from a crisis that was triggered in the first place by
overindebtedness.
As the ECB moves to unwind those policies, the debt
they contributed to could hurt
overleveraged companies and
consumers, hurting the region’s now booming economy. Rising interest rates
make it harder for people and
companies to borrow and
serve existing debts, crimping
their ability to spend and invest, while pushing some into
bankruptcy.
“There has been no meaningful decline in private
debt in the eurozone since
2008, as a share of gross domestic product, which is remarkable,” said Jörg Krämer,
chief economist at Commerzbank in Frankfurt.
At 1.5%, the interest rate on
Mr. Garcia e Costa’s loan was
less than half the average being offered for house purchases in Portugal a few years
ago. But it is tied to market interest rates so could rise substantially. The ECB’s key interest rate is currently minus0.4%.
National regulators are increasingly concerned that low
interest rates might be stoking
unsustainable asset-price bubbles. By imposing limits on
borrowing, they now hope to
discourage households and
firms from taking on debts
that are only sustainable because interest rates are so low.
In the Netherlands and Portugal, authorities have told
banks to limit mortgages to
90% of the value of a house. In
Finland, authorities recently
lowered that limit by 5 percentage points to 85% for
home loans, excluding first
home purchases. The Dutch
are also considering the end of
tax relief for mortgage loans,
while in Portugal banks must
offer loan maturities of no
more than 40 years.
In the real-estate sector,
“we do see signs of overvaluation in certain areas and large
cities, where housing prices
have increased at a faster pace
than household incomes,” Vítor Constâncio, the ECB’s vice
president, said last month.
House prices rose an annualized 10% and above in Ireland, the Netherlands and
Portugal in the third quarter of
last year, according to the European Union’s statistics
agency. Much of the money be-
Borrowing Binge
Eurozone private-sector debt levels have risen over the past decade and new lending is accelerating...
Annual change in lending to households and nonfinancial companies in the eurozone†
15%
Nonfinancial
corporations
10
Households and nonprofit
institutions serving households
5
0
–5
2004
2010
…as ultralow interest rates
encourage home purchases…
...and help push up property prices
in the euro area.
Cost of borrowing for home purchase
in the eurozone‡
Change in eurozone residential-property prices
since the end of 2003*
6%
40%
5
30
4
3
20
2
10
1
0
0
2004
2010
2004
2010
*Quarterly data through 3Q 2017 †Monthly data through February ‡Monthly data through January
Sources: Bank for International Settlements (debt);
European Central Bank (lending, cost of borrowing, prices)
hind those house purchases is
borrowed. In the Netherlands,
household debt stands at 270%
of net disposable income—
higher than in 2007.
U.S. households by contrast
have reduced their debts to
112% of net disposable income
from 144% in 2007, according
to the Organization for Economic Cooperation and Development.
In Ireland, where a burst
housing bubble cratered the
economy in 2011, mortgage approvals rose 23% last year,
while issuance when the mortgage is taken reached levels
last seen in the third quarter
of 2009, according to the Irish
Banking and Payments Federation. It expects residential
property prices in some areas to return to their 2007
peak level within two years.
Since 2015, the Irish central
bank has tightened lending
rules, but David McNamara, an
economist at Irish bank
Davy Capital Markets, said
credit figures suggest the latest moves have done little to
damp the market.
“Real-estate prices are always more worrisome than
any other form of asset
prices,” said Adam Posen, director of the Peterson Institute
THE WALL STREET JOURNAL.
for International Economics in
Washington. That is because of
the size of the sector and its
importance for the broader financial system.
Companies also binged on
debt. Loans to businesses
across the eurozone climbed
3.4% on the year in January,
their fastest rate since the financial crisis. Policy makers
want companies to borrow so
they can invest. But they
worry that low borrowing
costs might encourage investment in projects that are only
profitable at low interest rates,
and that such loans risk turning sour as interest rates rise.
Leucadia to Become Jefferies Financial
Leucadia National Corp. is
doubling down on its largest
business, financial services,
with plans to relinquish control of its meat business and
sell off its interest in a cardealership group.
The conglomerate intends
to change its name to Jefferies
Financial Group Inc., which
provides investment banking
and capital-markets services,
as part of focusing on what executives described as the “engine of opportunity.”
On Monday, Leucadia said it
had reached a deal to sell 48%
BANK
Continued from page B1
increasingly viewed as a potential internal candidate to
eventually lead the bank.
Some investors and analysts
felt he could benefit from
more preparation and broader
experience, especially in investment banking.
But internal turmoil at
Deutsche Bank and waning
confidence in its strategy, especially with regard to its
global trading and capital
markets operations, led its supervisory board to act over
the weekend.
Some of the turmoil
stemmed from revelations that
Deutsche Bank’s chairman,
Paul Achleitner, had been
searching outside the bank for
replacement
CEO
candidates. The supervisory board
felt uncertainty was damaging
the bank.
On Friday night, the supervisory board scheduled a
weekend call to talk about the
fate of CEO John Cryan. After
a 2½-hour discussion, the
bank’s supervisory board
late Sunday night tapped Mr.
Sewing, ending Mr. Cryan’s
time in charge with two years
left on his contract.
On Monday morning, Mr.
Sewing’s first memo to employees as chief executive
warned them, “We’ll have to
take tough decisions and execute them.”
The investment bank, he
wrote, will be “pulling back
from those areas where we are
not sufficiently profitable.”
of National Beef to Marfrig
Global Foods SA for $900 million in cash, reducing its stake
to 31%. The deal is expected to
close in the second quarter
and yield a pretax gain of at
least $800 million.
Leucadia executives said
National Beef “was too large
and concentrated of an investment” for the company.
Marfrig, which is based in
Brazil, will hold a 51% stake in
National Beef, most of which it
is buying from Leucadia. Marfrig said it plans to keep key
executives at the beef processor, including its top executive.
Leucadia also reached a
deal to sell all of its equity interest and relevant real estate
in Garcadia to the Garff family,
its partner in the car-dealership business, for $425 million
in cash and stock. The company expects to close on the
deal in the third quarter and
book a pretax gain of $220
million.
“The National Beef and Garcadia deals complete Leucadia’s transformation from a
highly diversified, but relatively random, group of assets
before the combination with
Jefferies into a financial-services company with clear focus
and drive,” Leucadia execu-
tives said in prepared remarks.
Leucadia’s board also increased its share buyback program to up to 25 million
shares. The New York-based
company had 12.5 million
shares available for repurchase
under the prior authorization.
Leucadia’s shares rose 12%
to $24.29 on Monday.
The company, which is
slated to release its first-quarter results on April 26, said on
Monday it is expecting a profit
of between $120 million and
$131 million, or 32 cents and
35 cents a share, on net revenue of about $820 million.
Those estimates include a
$21 million decline in the value
of its HRG investment, a holding company that is the majority owner of Spectrum Brands
Holdings Inc.
Also, Leucadia’s asset-management business is expected
to report a net loss “as a result
of the first quarter period of
exceptional volatility.”
In addition to Jefferies, Leucadia is invested in various
other businesses, including
FXCM, a trading business,
Linkem, an Italy-based broadband service, and Vitesse Energy. It also has a joint venture
with Berkshire Hathaway Inc.
called Berkadia.
Playing Catch-Up
Investment-banking revenue,
year to date*
JPMorgan
$1.6B
Goldman Sachs
1.5
Morgan Stanley
1.2
BofA Merrill Lynch
1.1
1.0
Citigroup
Credit Suisse
Barclays
Deutsche Bank
0.9
0.9
0.7
*As of Monday
Source: Dealogic
THOMAS LOHNES/GETTY IMAGES
BY ALLISON PRANG
THE WALL STREET JOURNAL.
Deutsche Bank’s ex-CEO John Cryan, left, and his successor, Christian Sewing, seen in February.
People who have worked
closely with Mr. Sewing say he
understands the lender’s businesses, from retail and private
banking to deal-advisory and
fixed-income trading—enough,
at least, to make tough decisions.
Maybe just as importantly,
some of those colleagues say,
Mr. Sewing is far less divisive
than some past and present
management-board members,
including recent CEOs.
His low-key style and perceived loyalty to Deutsche
Bank should help offset some
of the doubts he will face taking on the big job.
Plus, they say, he arrives
with an apparent mandate to
make quick decisions, something seen as lacking in recent
months, said people close to
the bank.
Mr. Sewing already stressed
Deutsche Bank’s repeated failures to reduce expenses as
promised, calling cost-cutting
targets “nonnegotiable.” That
won’t be popular with bankers
and traders looking for big bonuses.
It may be popular among
investors. Deutsche Bank’s
shares closed up 1.2% in
Frankfurt. They are down
about 27% this year.
Investors will want more
information quickly from Mr.
Sewing about what his promotion means for Deutsche
Bank’s strategy, especially for
its investment bank. Some analysts have called for the
lender to dramatically slash its
U.S. trading operations, arguing the profits don’t justify the
financial and legal risks involved. Initial reactions were
skeptical.
“We struggle to see how replacing Mr. Cryan with Mr.
Sewing will result in a change
of fortune for the bank,” Citigroup Inc. banking analysts
wrote Monday.
They called Mr. Sewing’s
appointment “underwhelming,” citing his lack of handson investment-bank experience or time outside of
Deutsche Bank.
Mr. Sewing started at
Deutsche Bank in 1989 as a
‘We’ll have to take
tough decisions and
execute them,’ says
the bank’s new CEO.
teenage apprentice, gaining
experience in retail and commercial banking in Germany.
He went on to advise corporate clients while based in Toronto and held senior creditrisk positions in Tokyo. Mr.
Sewing spent six years in Lon-
don as a credit and risk manager focused part of that
time on midcap European
companies, and more recently helped oversee audits
into some of Deutsche Bank’s
thorniest legal matters.
Mr. Sewing has told colleagues that he never planned
his career, but rather followed
the course it naturally took.
That course will steer him
to the U.S., where the Germany-centric banker is now
planning a trip, a person close
to the bank said. That will
help him to become better acquainted with U.S. regulators.
Some have been pressing
Deutsche Bank to shrink the
riskier pieces of its U.S. operations, said the people close to
the bank.
Those key U.S. regulatory
relationships had been a major
focus of Mr. Cryan’s time, and
he was credited with making
strides to improve them.
In France, corporate debt
has risen to around 134% of
GDP from 104% a decade ago,
according to data from the
Bank for International Settlements.
Altice NV racked up more
than €50 billion in debt to finance a raft of acquisitions
that made it one of the world’s
largest media and telecom
companies over the past four
years.
“I bought everything on
credit,” Patrick Drahi, the company’s founder and chief executive, said in a 2016 speech. “I
didn’t take much risk. It’s the
banks that lent everything.”
Since then, Altice’s stock
has fallen more than twothirds over the past nine
months as the company struggled to retain customers and
generate new sales in Europe,
forcing it to put some businesses up for sale to pay off
debt.
French authorities recently
limited the exposure of banks
to highly indebted large companies and suggested they
might force lenders to increase
their capital levels.
“We consider that there is a
risk that big companies in particular are going too far,” Bank
of France Gov. François Villeroy de Galhau said.
Leverage is building even as
many European banks continue to deal with debt accrued from the financial crisis. Over $1 trillion of loans
outstanding is considered nonperforming and continues to
weigh in on the books of European banks, which have assumed actual losses half of
that amount.
ECB President Mario Draghi
has defended the low-rates
policy, saying it has boosted
the local economy and created
jobs. “The distortions may be
there, but sometimes the
trade-off is so powerful that
you just ignore them and do
the right thing,” Mr. Draghi
said in October.
—William Horobin in Paris
contributed to this article.
Regulator
Lays Out
New View
On Banks
BY LALITA CLOZEL
WASHINGTON—Comptroller of the Currency Joseph Otting promised a new regulatory relationship with the
nation’s banks, saying he
wants his agency to be more
responsive to “our customers,
which are the banks.”
Mr. Otting, a Trump appointee and former banking
executive who now heads the
agency that supervises his former peers, on Monday laid out
his plans to ease the application of banking regulations to
cut compliance costs for banks
in an effort to encourage them
to lend more.
Speaking at a communitybanking conference, he also
said he wanted to run the Office of the Comptroller of the
Currency in a “more cost-efficient and a more effective
manner.”
Mr. Otting is leading a joint
agency effort to modify the
application of the 1977 Community Reinvestment Act,
which compels banks to make
loans in poor communities located near their headquarters
and branches.
He wants to expand the
types of loans that banks can
count as part of the program,
placing more weight on smallbusiness and student loans.
In another change, Mr. Otting wants to make it easier to
track how well banks are doing even between CRA examinations, which typically occur
every three years.
Additionally, Mr. Otting
wants banks to be graded by
lumping together all their
community-reinvestment activities in a single figure and
dividing it by an indicator of
the bank’s size, such as total
assets or deposits, as a way to
determine the scale of their
efforts.
Banking regulators are expected to issue a request for
public comment on modifying
the 1977 law within the next
month, he said. Changing the
law was the subject of a Treasury report last week.
.
THE WALL STREET JOURNAL.
Tuesday, April 10, 2018 | B13
* * * *
MARKETS
Prices of
Treasury
Bonds
Decline
AUCTION RESULTS
Here are the results of Monday's Treasury auctions.
All bids are awarded at a single price at the marketclearing yield. Rates are determined by the difference
between that price and the face value.
13-WEEK AND 26-WEEK BILLS
13-Week
26-Week
$140,379,711,200 $127,842,448,400
$48,000,176,200 $42,000,025,400
$784,923,200 $682,530,400
$100,000,000 $1,000,000,000
99.566486
99.049556
(1.715%)
(1.880%)
1.746%
1.924%
Coupon equivalent
5.27%
45.47%
Bids at clearing yield accepted
912796PQ6
912796NZ8
Cusip number
Applications
Accepted bids
" noncomp
" foreign noncomp
Auction price (rate)
Both issues are dated April 12, 2018. The 13-week bills
mature on July 12, 2018; the 26-week bills mature on
Oct. 11, 2018.
Mideast
Turmoil
Lifts Oil
BY ALISON SIDER
AND CHRISTOPHER ALESSI
Oil prices rose along with
broader markets Monday as
fears surrounding a trade war
between the U.S. and China receded and
COMMODITIES oil investors
turned their
attention to
rising tensions in the Middle
East.
U.S. crude futures rose
$1.36, or 2.19%, to $63.42 a
barrel on the New York Mercantile Exchange. Brent, the
global benchmark, rose $1.54,
or 2.29%, to $68.65 a barrel on
ICE Futures Europe.
The move—oil’s biggest
daily gain in more than two
weeks—is a pivot from last
week, when the U.S. benchmark posted its biggest weekly
loss in two months. Last week,
oil prices followed equity markets lower as U.S. and Chinese
officials lobbed threats of new
tariffs, raising the prospect of
a trade war between the
world’s two largest economies.
Investors feared that would
impede the global growth that
was one of the main underpinnings of oil’s climb in recent
months.
Oil traders shifted focus to
Syria following an airstrike
early Monday, said Andy Lipow, president of Lipow Oil
Associates. Missiles hit an air
base in Syria, a strike that
Russia blamed on Israel. Over
the weekend, a suspected
chemical-weapons attack in a
rebel-held town killed dozens
of civilians and spurred calls
for international action.
Monsanto shares rose 6.2% after the Justice Department decided to let Bayer acquire the company. A Monsanto booth at a farm show last year included corn plants.
Stocks Hold On to Slight Gains
BY GUNJAN BANERJI
AND RIVA GOLD
and Nasdaq, compared with
the year-to-date average daily
volume of 7.4 billion shares.
Monday marked the third-quietest day of trading this year
and the lowest trading volume
since Feb. 23, according to the
WSJ Market Data Group.
Health-care and technology
stocks powered Monday’s rebound, sending the Dow up
46.34 points, or 0.2%, to
23979.10. The S&P 500 added
8.69 points, or 0.3%, to 2613.16,
and the Nasdaq Composite rose
35.23 points, or 0.5%, to
6950.34.
All three indexes had fallen
more than 2% Friday as investors worried that planned escalating tariffs between the U.S.
and China could lead to policies that threaten global economic growth.
Merck was the best performer in the Dow, rising
$2.80, or 5.3%, to $56.16 after
disclosing a positive clinical
trial for cancer drug Keytruda.
Monsanto jumped 7.29, or
6.2%, to 125.15 after The Wall
Street Journal reported that
the Justice Department has decided to allow Bayer’s deal to
acquire the company.
“The mood of the day” regarding the prospect for a
Stocks inched higher as policy makers appeared to dial
back the tough tone on trade
that rocked markets at the end
of last week.
Major indexes powered
higher for the much of the session—with the
MONDAY’S
Dow Jones InMARKETS
dustrial Average gaining as
much as 440
points—before paring most of
their gains in the final hour of
trading. As market volatility
has roared back in the past two
months, big moves—in both directions—have become common at the end of trading sessions.
Investors were alarmed just
ahead of Monday’s closing bell
by headlines that federal investigators had searched the office
and home of Michael Cohen,
President Donald Trump’s
longtime lawyer, but the indexes held on to slight gains.
Another possible reason for
the big swings: Stock-trading
volumes were particularly low
Monday, with just 6.2 billion
shares changing hands across
the New York Stock Exchange
Tech Outperforms
Technology shares were among the best performers in
the S&P 500 on Monday.
3.0%
2.5
2.0
S&P information
technology
s0.8%
1.5
1.0
0.5
Nasdaq
Composite
s0.5%
0
S&P 500
s0.3%
9:30 10
11
noon
1
Source: FactSet
trade war with China appears
to be driving buying and selling in the market, said Brent
Schutte, chief investment strategist at Northwestern Mutual
Wealth Management.
Analysts also attributed
some of Monday’s improved
risk sentiment to news that
North Korea confirmed its
readiness to discuss denuclearization of the Korean Peninsula
with the U.S.
2
3
4
THE WALL STREET JOURNAL.
The pattern of exchanges
between the U.S. and North Korea—an initial tough stance
from the U.S. later followed by
signs of cooling hostility—may
offer a guide for how U.S. and
China trade talks play out, said
James Athey, senior investment manager at Aberdeen
Standard Investments. “The
potential for missteps is real,
but at the moment, I don’t see
anything to dissuade me of the
opinion we’re headed to an amicable agreement on trade between these two countries,” he
said. “For me, this is the opening salvo in a negotiation
which should ultimately lead to
a stronger trading relationship
between the U.S. and China.”
Some investors were also
looking ahead to the start of
the first-quarter earnings season in the U.S. this week to
support the case for stocks.
As of Friday, 53 S&P 500
companies had issued positive
earnings guidance for the quarter, which would mark the
highest number since at least
2006, according to FactSet.
Guidance has been particularly
strong in the technology sector,
even as tech shares have fallen
sharply in the past month.
The technology group in the
S&P 500 was one of the biggest
winners on Monday, rising
0.8%, a positive sign to some
that shares of companies that
had led broader U.S. stock indexes higher for months could
regain their footing and help
markets rebound.
Early Tuesday, Japan’s Nikkei was down less than 0.1%,
Hong Kong’s Hang Seng Index
was up 0.3% and South Korea’s
Kospi was own 0.5%.
NYSE Welcomes Nasdaq-Listed Stocks
BY ALEXANDER OSIPOVICH
The New York Stock Exchange has ended a decadesold restriction that prevented
stocks listed on rival exchanges from being bought
and sold on its historic trading
floor in lower Manhattan.
The change took effect on
Monday as part of a longawaited upgrade of the NYSE’s
systems. Now, Nasdaq-listed
securities such as Apple Inc.
or Kraft-Heinz Co., as well as
any U.S. exchange-traded fund,
can be traded on the NYSE’s
flagship exchange for the first
time.
That expands the number of
securities that can potentially
be traded at the Big Board to
all 8,600 stocks and ETFs
listed in the U.S. Until now,
trading at the venerable exchange was limited to the
roughly 3,150 securities listed
on the NYSE, effectively making it a gated community for
the shares of firms that met
the exchange’s listing standards and were willing to pay
the NYSE’s listing fees.
But that restriction made
less sense as markets went
electronic and dozens of rival
trading platforms emerged, assisted by regulations that en-
Humbled Giant
The New York Stock Exchange's
share of stock-trading volume
has fallen over the past decade
as new rivals have emerged.
50%
40
30
20
10
0
2007
BETTMANN ARCHIVE/GETTY IMAGES
U.S.
government-bond
prices fell Monday as investor
concerns about the risks of a
trade war between the U.S.
and China cooled.
The yield on the benchmark
10-year Treasury
CREDIT
note rose for the
MARKETS fourth time in
the past five
trading sessions,
settling at 2.786% from 2.779%
on Friday. Yields rise as bond
prices fall.
Stock prices rebounded
from a sharp decline Friday,
helping send bonds lower after
Trump administration officials
on Sunday softened some of
the rhetoric after threatening
to impose new tariffs on
China, noting the penalties
aren’t imminent and there is
time to work out a deal.
“We’re reacting to general
risk sentiment,” said Gennadiy
Goldberg, a strategist at TD
Securities. “You’ve got stocks
retracing a good chunk of
what they lost, and that’s just
nudging rates a little higher.”
Yields also rose ahead of
the government’s sale of $64
billion of notes and bonds this
week. Some investors have
said the growing supply of
debt could pressure bond
prices. The Congressional Budget Office said Monday that
the U.S. budget deficit will rise
to $804 billion in 2018 and exceed $1 trillion a year starting
in 2020.
Investors also are looking
ahead to data being released
on Wednesday, including the
Labor Department’s scheduled update on the consumerprice index. Investors will
scrutinize that data to see
whether wage gains are helping lead to faster inflation,
which threatens the value of
government bonds by eroding
the purchasing power of their
fixed payments.
DANIEL ACKER/BLOOMBERG NEWS
BY DANIEL KRUGER
’10
Note: Chart shows combined share of all
NYSE exchanges including Arca and NYSE
American.
Source: Tabb Group
THE WALL STREET JOURNAL.
Until now, trading at the Big Board was limited to the 3,150 securities listed on the exchange.
couraged greater competition
in the exchange business. That
eroded the NYSE’s status as
the go-to marketplace for buying and selling large-cap
stocks.
Until this week, out of the
12 U.S. stock exchanges in op-
eration, the NYSE’s flagship
exchange was the only one
that limited trading to its own
listed securities.
“That is a 180-degree turnaround for the NYSE,” said
James Angel, an associate professor of finance at George-
town University.
Investors are unlikely to notice much difference as a result of Monday’s change. But
the move could potentially
lead to an uptick in the NYSE’s
market share, analysts say.
The Big Board, owned by
Intercontinental Exchange
Inc., and its two smaller sister
exchanges handled 22.6% of
U.S. equities trading volume in
February, according to research firm Tabb Group.
That is bigger than the
NYSE’s two largest rivals—
Nasdaq Inc. and Cboe Global
Markets Inc.—but it is much
reduced from the nearly 40%
market share that the NYSE
group of exchanges enjoyed a
decade ago.
Iranians Line Up for Currency as Rial Plunges to Record
Iran’s currency fell to another
record against the U.S. dollar
Monday as people lined up outside exchange houses in Tehran
By Asa Fitch in Dubai
and Aresu Eqbali
in Tehran
to buy the greenback, adding to
the Islamic Republic’s economic
pressures.
Iran’s inflation is in double
digits, and unemployment remains high, factors that contributed to the widespread protests
that rocked the government earlier this year. Concerns, meanwhile, have increased that the
Trump administration will pull
out of the 2015 nuclear accord
and slap on more sanctions that
could weigh on financial transactions and slow the economy.
Many Iranians also have bet
against the rial in the hope of
making a quick buck, adding to
the pressure on the local currency.
The rial on Monday was exchanged at more than 60,000
per dollar, compared with about
48,000 on April 1, forcing people
in need of foreign currency to
navigate a dwindling number of
money houses still open for trading. “This is a mess,” said 33year-old Hamed, who was waiting at an exchange attempting to
get money for a trip to Japan. He
declined to give his full name.
“Iranians don’t deserve to stand
in such lines and experience such
disgrace for $500 or $1,000. We
can’t go abroad with rials.”
The authorities have responded to the slide with a raft
of currency-stabilization measures, including issuing foreigncurrency sovereign bonds and
raising deposit rates at local
banks to stir demand for the rial.
They also have shut down dozens of unlicensed currency traders.
Such moves helped spark a
recovery in the currency in late
February, when it strengthened
from more than 50,000 to the
dollar to below 45,000. But
hopes that the end of the Nowruz holiday in March—traditionally a period of peak demand for
dollars as many people travel
abroad—would bring additional
calm were dashed when the rial
fell again this month.
On Monday evening, the authorities made their boldest bid
yet to stem the weakness by
promising to peg the rial at
42,000 to the dollar. Iranian Vice
President Eshaq Jahangiri announced on state TV that the
government would provide the
currency to satisfy demand at
that rate through the central
bank, money exchanges and
banks.
The move would bring
Iran’s free-market rate much
closer to its official rate, which
is set by the government and
is only available in commercial
transactions that the government approves. The official
rate was about 37,800 rials to
the dollar on Monday, according to a central bank website.
Unifying the official and freemarket rates has long been a
goal of President Hassan Rouhani’s administration.
“People should not be worried about providing their foreign-currency needs with this
rate,” Mr. Jahangiri said, adding that any other rate in the
market would be outlawed as
of Tuesday.
.
B14 | Tuesday, April 10, 2018
THE WALL STREET JOURNAL.
MARKETS
Trade Worries Intensify Dollar’s Woes
Past year’s drop could
worsen due to tariffs,
spooked investors,
shift on rates by Fed
BY CHELSEY DULANEY
Escalating trade tensions
between the U.S. and China
are emerging as the latest
threat to the U.S. dollar, which
has been losing value for more
than a year.
U.S. exports could come under pressure if China or other
countries ramp up tariffs on
U.S. products, which would effectively reduce demand for
dollars and potentially widen
the trade deficit that the
Trump administration is attempting to close. Shares of
big U.S. exporters, such as
Boeing Co. and Caterpillar
Inc., have tumbled in recent
weeks as investors fear trade
policies will hurt overseas
sales.
Meanwhile, the rise in trade
tensions could spook global investors. The U.S. depends on
them to fund its budget deficit
by buying U.S. Treasury
bonds. The Congressional Budget Office estimated Monday
that the federal budget deficit
will total $804 billion this
year and exceed $1 trillion a
year starting in 2020.
“Our dependence on foreign
investors to fund the massive
deficit has always been the
Achilles’ heel of the U.S. dollar,” said Omer Esiner, chief
market analyst at Commonwealth Foreign Exchange. “An
abandonment of U.S. assets…is
a risk for the dollar.”
While fears over new tariffs
and a potential trade war
could boost the U.S. dollar
against some export-dependent emerging-market currencies such as the South Korean
won and Mexican peso, analysts say the dollar is unlikely
to gain much against major
peers like the euro or Japanese
yen. On Monday, the dollar fell
93
ICE U.S. Dollar Index
China says it will
match the U.S.’s tariffs.
92
Trump says the U.S. will
impose tariffs on steel
and aluminum imports.
U.S. imposes tariffs on imports of
washing machines and solar panels.
91
Trump administration
threatens to impose tariffs on
$50 billion in Chinese goods.
90
89
Trump says the U.S. is considering an additional
$100 billion in tariffs on Chinese goods.
88
China vows to retaliate
against stepped up U.S. tariffs.
87
January
February
March
Expectations that the Fed will raise rates
more than three times this year
April
U.S.-China trade deficit for goods
40%
$0 billion
30
–100
20
–200
10
–300
0
–400
January
February
March
April
How much foreign currency one U.S. dollar buys
Chinese yuan
South Korean won
1,100 won
6.60 yuan
1,090
6.50
2005
’07
’09
’11
’13
Singapore dollar
Taiwan dollar
S$1.340
T$29.80
’15
’17
29.60
1.330
1,080
29.40
6.40
1.320
1,070
6.30
29.20
1.310
1,060
6.20
1,050
J
F
M
A
29.00
1.300
J
F
M
A
28.80
J
F
M
A
Sources: FactSet (dollar index); CME Group (rate-increase expectations); U.S. Census Bureau (trade deficit); WSJ Market Data Group (forex rates)
0.3% against the euro and 0.1%
against the Japanese yen.
“It’s hard to see the dollar
going up,” said Steven Blitz,
chief U.S. economist at TS Lombard. “If all these tariffs cause
the U.S. economy to slow…the
dollar would weaken.”
The greenback started sliding in early 2017, when investors turned more optimistic
about the growth prospects
for other major economies
around the world. The ICE U.S.
Dollar Index, which measures
the currency against six major
peers, has fallen about 11%
over the past year.
The index has been volatile
this month, falling 0.3% as the
U.S. and China have exchanged
threats and announced plans
for tariffs on billions of dollars
in each other’s goods.
J
F
M
A
THE WALL STREET JOURNAL.
Analysts at Oxford Economics point to the U.S. SmootHawley Tariff Act of 1930, which
raised tariffs on imports by
about 20% and led to a decline
in capital flows into the U.S.
“The U.S. economy is now
much more reliant on foreign
HEARD ON THE STREET
Email: heard@wsj.com
FINANCIAL ANALYSIS & COMMENTARY
Deutsche CEO Has a Tough Task
OVERHEARD
Deutsche Bank has a new
chief executive, but Christian
Sewing will find it much easier to change the tone of
leadership than the bank’s
destiny.
Mr. Sewing, a 25-year veteran who most recently
headed Deutsche’s retail
bank, was named late Sunday to succeed John Cryan,
whose three-year tenure has
seen hefty restructuring but
very little recovery.
Mr. Sewing promises to be
more decisive and demanding. Unfortunately, the banking sector is probably changing more rapidly than a
bureaucratic behemoth like
Deutsche can match. As it
pursues more costly and
painful restructuring, fitter
rivals will pull farther ahead.
Where Mr. Cryan bought a
much-needed dose of realism
to a bank that hadn’t faced
up to its many problems and
weaknesses, Mr. Sewing is
pledging discipline and consequences for failure. Missed
targets? “The new leadership
team will not accept this
anymore. We’ll have to take
tough decisions and execute
Not everyone was celebrating the latest blockbuster
biotech deal.
The week couldn’t have
started any better for AveXis
shareholders, as Novartis’s
$8.7 billion offer to buy the
company sent shares 82%
higher Monday.
Investors who bought
shares in the 2016 initial public offering and held on to
them have made more than
10 times their money in less
than 26 months.
Short sellers, however, had
a miserable Monday morning.
Roughly 3.5 million shares
were sold short at last count,
according to Nasdaq data.
Those bearish bets amount
to roughly one-eighth of total
available shares.
Those short sellers who
believe that AveXis’s experimental drugs won’t eventually translate into windfall
profits for the company could
still be proved correct. But
since Novartis disagrees with
that assessment, any future
vindication won’t put Monday’s lost money back in
those investors’ pockets.
Unbalanced Portfolio
Deutsche Bank's split of revenues and risk-weighted assets by
division
Corporate and
investment bank
Private and
commercial bank
Asset
management
RWAs
Revenues
Head office
0%
25
50
75
THE WALL STREET JOURNAL.
Source: the company
them,” he wrote to employees.
A stern approach might
help spur the work ethic in
the short term, but if the
bank continues to stumble,
then cracking down on those
who fall short might not
change anything.
And the problem is those
stumbles will keep coming.
In retail and commercial
banking, Mr. Sewing alone
can’t whip the German market into better shape. An
eventual merger with local
rival Commerzbank could
help because it has a stronger base among more profitable small and medium-size
businesses. But that won’t
make Germany a good market.
Then there is investment
banking, where so many of
Deutsche’s past glories
proved illusory. This also is
where Deutsche has been the
slowest in its response and
where it may have fallen ir-
retrievably behind.
Investment banking is increasingly a game of either
very great scale or specialization. In the scale game, it
seems now only the global
top three can truly be global
players in each field. As a
global player, Deutsche continues to lose ground.
Shrinking back to being a
regional specialist, focused
on mainly Germany and Europe, looks like the right
strategy.
But being right doesn’t
make it easy. In retreat, investment banks tend to shed
revenues much faster than
costs, which is terrible for
profits and ultimately capital
strength, too.
As Mr. Sewing tries to
solve this puzzle, the biggest
risk is that he could need yet
another capital raise to pay
for a quicker exit from the
investment-banking businesses in which Deutsche
can’t win. That would be decisive and demanding, for
sure, but investors would almost certainly be horrified
whoever is at the helm.
—Paul J. Davies
Corporate Bonds Go Into Reverse Following Steady Gains
Corporate bonds have
been the easiest way to eke
out a higher gain in a yieldstarved world. This year,
though, they are doing the
opposite. The corporate-bond
money maker has gone into
reverse.
U.S. investment-grade corporate bonds—issued by
blue-chip names with relatively strong balance
sheets—have returned minus
2.2% this year, compared
with minus 1.4% for Treasurys, ICE BofAML indexes
show. The poor performance
is due to widening credit
spreads, with the gap between corporate bond yields
and underlying government
yields expanding to 1.14 per-
Sinking Feeling
Total returns on ICE BofAML
bond indexes
U.S. high-yield
Treasurys
U.S. investment-grade
2%
0
–2
–4
J
F
M
A
Source: FactSet
centage points, from 0.98 at
the start of 2018. Junk
bonds, cushioned by higher
yields, are faring a little better but are still down 0.6%.
The contrast with last year’s
strong gains is stark.
Corporate bonds look vulnerable on several fronts.
Underlying government-bond
yields have moved higher as
the Federal Reserve has
lifted rates and fears about
inflation have returned. But
credit spreads had also
reached very tight levels at
the end of 2017—diminishing
the cushion against Treasury
yield moves. Indeed, the
spread on U.S. corporate
bonds as a share of their total yield recently reached the
lowest level in a decade,
BlackRock notes. The recent
widening has pushed the
share up only a little.
But it isn’t necessarily
higher rates that explain
wider spreads. After all, if
Treasury yields are rising because of stronger growth and
inflation, that should be
good news for company balance sheets. The rub is that
credit spreads also behave
like measures of volatility in
that they reflect a premium
for uncertainty about the future. U.S. policies on trade,
taxes and spending are raising the prospect of higher
economic volatility in the future. If volatility is here to
stay, so are wider spreads,
making it harder for corporate bonds to recoup their
losses.
Meanwhile, negative total
returns mean investors are
pulling back. An exchangetraded fund that tracks the
U.S. market, the iShares
iBoxx $ Investment Grade
Corporate Bond ETF, has recorded net outflows of more
than $5 billion this year, according to FactSet. Riskier
high-yield bond funds have
logged outflows for 12 weeks,
the longest streak since
2007, according to Bank of
America Merrill Lynch.
Higher yields and, in particular, wider spreads on investment-grade corporate
bonds will at some point act
as a lure for cash. But the
market moves so far aren’t
big enough to offer obvious
value. Spreads are still tight
by historical standards. The
ride could stay bumpy for
some time. —Richard Barley
capital inflows that it was
then,” said Oren Klachkin, the
firm’s lead economist. “If foreign demand were to weaken,
there may be a significant depreciation of the dollar.”
The dollar hasn’t fared well
in more recent trade spats, either. President George Bush’s
decision to slap tariffs on steel
imports in the early 2000s
helped send the ICE Dollar Index down nearly 20% between
2001 and 2003, according to
data from TD Securities. As
trade tensions rose between
the U.S. and Japan in the
1990s, the dollar index fell
more than 10%.
Investors have already been
amassing bets against the dollar over the past year, confounding many Wall Street analysts who had expected the
currency to benefit from
stronger economic growth,
Federal Reserve rate increases
and changes to the U.S. tax
code that should encourage
companies to bring home
earnings stashed overseas.
Hedge-fund and other
money managers are now
holding around $25 billion in
bets against the U.S. dollar, according to Scotiabank and
Commodity Futures Trading
Commission data.
The rising trade tensions
and their potential U.S. economic impact could also keep
the Fed from tightening policy
at its current projected path.
That also would likely weigh on
the greenback as lower rates
encourage investors to look
elsewhere for yield.
On Monday, investors saw a
26% chance that the Fed would
deliver two or more additional
rate-increases this year—after
the increase in March—down
from 33% last week, according
to CME Group data.
“It might be viewed as undermining the Fed’s tightening resolve,” said Alvise Marino, a currency strategist at
Credit Suisse. “On the margin,
it reinforces the dollar’s negative trend.”
WSJ.com/Heard
Consumer
Credit Could
Dent Growth
Weak consumer lending
risks becoming a headwind
for an otherwise healthy
economy.
Evidence is mounting that
consumer lenders are slowing their credit-card, auto
and other loans. Monthly
data from the Federal Reserve shows that total consumer loans outstanding
rose at a seasonally adjusted
annualized pace of just 3.3%
in February, down from 4.9%
in January and 6.0% in December.
For all of 2017, consumerloan growth slowed, dropping to 5.4% from 6.8% the
prior year, according to the
Fed data.
Revolving consumer-credit
lines, primarily credit cards,
have slowed even more
sharply. Total outstanding
revolving credit was up a
seasonally adjusted annualized 0.2% in February. That
is the lowest monthly reading since revolving credit fell
in November 2013.
There are two explanations: First, lenders have
grown more cautious over
the past year in response to
rising delinquencies and defaults on their loans. Shares
of consumer lenders have
underperformed lately, reflecting concerns over
slower loan growth and
credit issues.
Second, consumers may
now be paying down loans.
This effectively means that
consumers are saving more.
It also means that modestly rising wages and lower
taxes won’t spur consumer
spending as strongly as investors appeared to believe
last year. Consumers drive
the U.S. economy and if they
moderate their spending,
overall economic growth
could be lower than expected
this year.
—Aaron Back
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