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The Wall Street Journal - January 4, 2018

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THURSDAY, JANUARY 4, 2018 ~ VOL. CCLXXI NO. 3
* * * * * *
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Business & Finance
T
he U.S. auto industry
suffered its first annual sales drop since the
financial crisis, but a streak
of strong profits is expected
to overshadow a slowdown in dealer traffic. A1
Tesla posted fourth-quarter Model 3 sales that badly
missed Wall Street’s already
lowered expectations. B3
Fed officials in December debated whether looming tax cuts might require
them to raise rates more
aggressively in 2018. A2
Dominion Energy agreed
to buy Scana, which was
hamstrung by a South Carolina nuclear project, in a
$7.43 billion all-stock deal. B1
Merrill has blocked clients and financial advisers
who trade on their behalf
from buying bitcoin. B1
Tech firms pushed major U.S. stock indexes to
fresh records, a day after
the Nasdaq topped 7000. B14
Spotify has confidentially
filed paperwork with the
SEC to list its shares on the
New York Stock Exchange. B3
A former Och-Ziff deal
maker faces criminal charges
in connection with an alleged scheme that yielded a
foreign bribery settlement. B8
Spark will charge
$850,000 a patient for a
new treatment for a hereditary form of vision loss. B2
Petrobras agreed to pay
$2.95 billion to settle a lawsuit by U.S. investors. B8
BY ELI STOKOLS
YONHAP/ASSOCIATED PRESS
Foreign makers of washers
and solar panels are ramping
up shipments to the U.S. ahead
of government decisions
on possible new barriers. A1
YEN 112.51
Trump
Rips Into
Bannon
Over Book
Can You Hear Me Now? Two Koreas Test a Hotline
What’s
News
EURO $1.2014
SIGN OF A THAW: A South Korean official checked a special phone link with North Korea Wednesday for the first time in almost two years. A5
Auto Sales Growth Stalls
Annual drop of 1.8% is
first in eight years, but
pickups and SUVs
bolster U.S. results
BY MIKE COLIAS
AND ADRIENNE ROBERTS
DETROIT—The U.S. auto industry suffered its first annual
sales decline since the financial crisis eight years ago, but
a streak of strong profits is expected to overshadow a slowdown in dealership traffic.
Though sales fell 1.8% last
year as pent-up demand declined and interest faded in
sedans and compact cars, auto
makers still sold 17.2 million
vehicles in 2017, the first time
the industry has cleared the
17-million mark three consecutive years, according to IHS
Markit. Buyers took advantage
of low gasoline prices and
loan rates, flocking to pickups
and sport utilities—a trend
that delivers much higher
margins to Detroit and its foreign rivals.
Vehicles now routinely sell
for above $32,000, even with
average incentives of $4,000
factored in, according to J.D.
Power. That is 10% higher
than what car buyers were
dishing out when the industry’s rally began in 2010.
The domestic car business
is far healthier than the last
time volumes slipped. A decade ago, General Motors,
Ford and Chrysler were sad-
dled with high labor costs and
a glut of unpopular models,
making it more difficult to
manage a downturn. GM and
Chrysler eventually shed
much of their fixed labor and
health-care costs through
stays in bankruptcy court.
Still, industry executives
remain concerned that last
year’s decline could prove
more than a modest blip.
Rising interest rates, less
pent-up demand and a potential decline in the value of
used cars—which buyers often
trade in when buying a new
vehicle—could further pressure sales. That could prompt
Please see CARS page A2
Tesla’s Model 3 sales fall
short of goal............................... B3
In Reverse
Change from previous year in
U.S. vehicle sales*
15%
10
5
0
–5
2017
17.2 million
vehicles sold
▼1.8%
–10
–15
–20
–25
2007
’10
’15
*Excludes commercial vehicles
Source: Autodata
THE WALL STREET JOURNAL.
’17
WASHINGTON—President
Donald Trump publicly repudiated Steve Bannon, his former
senior strategist and onetime
campaign chief, after a new
book surfaced in which Mr. Bannon made scathing and highly
personal criticisms of some of
the president’s top advisers, including several family members.
“Steve Bannon has nothing to
do with me or my Presidency,”
Mr. Trump said in a statement
released to reporters on
Wednesday. “When he was fired,
he not only lost his job, he lost
his mind.”
In the book, a copy of which
was viewed by The Wall Street
Journal, Mr. Bannon called a
June 2016 meeting between top
Trump campaign aides and a
Russian lawyer “treasonous”
and aired concerns that missteps by aides could lead to legal
jeopardy for the president.
The meeting has become a
focus of special counsel Robert
Mueller’s investigation into
Moscow’s meddling in the 2016
election and whether Trump
campaign aides colluded with
the Kremlin in the interference.
Mr. Trump has said his campaign didn’t collude with Russia,
and Moscow has denied meddling in the U.S. election.
The president’s public statement was released after the
publication of quotes and excerpts from “Fire and Fury: InPlease see BANNON page A4
Manafort
Vs. Mueller
Indicted former Trump aide
files suit challenging special
counsel’s authority.............. A4
World-Wide
INSIDE
Trump repudiated Bannon, his former senior strategist, after a new book surfaced in which Bannon made
scathing and highly personal
criticisms of some of the president’s top advisers, including
several family members. A1
Mobile payments change how people shop, borrow—even panhandle
Manafort filed a lawsuit challenging Mueller’s
authority in indicting him
on money-laundering and
tax-related charges. A4
Trump dissolved the
commission he created to
investigate his claims of voter
fraud in the 2016 election. A3
The president suggested
this week that Clinton confidante Abedin should be jailed,
alleging that she had endangered national security. A4
Iranians are protesting
in the streets in part because
an economic windfall from
the landmark nuclear deal
never fully materialized. A6
Congressional leaders
emerged from a White
House meeting without a
budget deal, as Democrats
intensified their push for an
immigration agreement. A4
Sessions appointed Geoffrey Berman, a law partner
of Giuliani, as temporary U.S.
attorney in Manhattan. A2
Airlines canceled thousands of flights and schools
closed as a winter storm
roared up the East Coast. A3
Died: Thomas Monson, 90,
Mormon Church president. A2
CONTENTS
Business News...... B3
Crossword.............. A14
Heard on Street. B14
Management.......... B7
Markets............. B13-14
Middle Seat............ A9
Life & Arts......... A9-13
Opinion.............. A15-17
Sports....................... A14
Technology............... B4
U.S. News............. A2-4
Weather................... A14
World News........ A5-7
>
s Copyright 2018 Dow Jones &
Company. All Rights Reserved
BY ALYSSA ABKOWITZ
MICHAEL WITTE
North Korean and South
Korean officials tested a
special hotline for the first
time in almost two years,
signaling a tentative thaw. A5
The Cashless Society Has
Finally Arrived—In China
MORE RULES, LESS ROOM
FOR AIR TRAVEL IN 2018
THE MIDDLE SEAT, A9
Keep Puffing!
It’s Only
Been an Hour
i
i
i
‘Slow smokers’ vie
to keep cigars lit
as long as possible
BY CHARLES PASSY
There have been plenty of famous cigar smokers. Winston
Churchill, George Burns and
Groucho Marx come to mind.
There’s also Bill Hroncich.
Mr. Hroncich, a 57-year-old
resident of Hazlet, N.J., who
works for a pharmaceutical
company, has a rare cigar-related claim to fame. He can
keep a stogie going for a long
time without relighting.
“You have to puff gingerly—
just enough to keep it hot,” said
Mr. Hroncich, whose cigar-burning time of 1 hour and 37 minutes earned him the title of U.S.
slow-smoking champion at a
New York event last year.
Please see SMOKE page A8
BEIJING—Soliciting handouts near a grocery store, Zhao Shenji, a slender man with
shorn hair, made giving easy for Beijing residents accustomed to relying on their smartphones.
“Recommend using WeChat Pay,” said a
placard the beggar displayed.
It was a literal sign of the times. Payment
via mobile-phone services such as WeChat is
sweeping the country. After gaining a beachhead as a means to buy things online, mobile
payment moved on to store purchases and is
fast becoming the way many people in China
pay for just about everything.
That includes small personal debts. Richard
Lau, a young management consultant waiting
Threat of Tariffs Leaves
U.S. Awash in Washers
BY ANDREW TANGEL
Foreign makers of such
products as washing machines
and solar panels are ramping
up shipments to the U.S. ahead
of government decisions on
whether to erect new barriers,
trade data show.
The influx of goods comes
after companies including appliance giant Whirlpool Corp.
and solar-panel maker Suniva
Inc. asked the Trump administration in recent months to
use powers under a controversial trade law that gives the
president wide discretion on
tariffs and quotas.
The two cases are among
the early tests of President
Donald Trump’s “America
First” trade policy and his
pledges to help U.S. manufacturers and factory workers.
Ships brought 9,063 containers’ worth of large residential washers to U.S. ports in
November, more than double
the clip of November 2016, a
month after American regula-
tors sided with Whirlpool in a
dispute with South Korean rivals Samsung Electronics Co.
and LG Electronics Inc., according to an analysis of customs
and U.S. Census Bureau data
from research firm Panjiva.
Samsung and LG had a combined 35% share of the retail
U.S. washer market last year,
roughly equal to Whirlpool’s.
Myles Getlan, an attorney
for Whirlpool, said recent import levels were a sign that
competitors were stockpiling
washers. “It has the potential
to undermine the effectiveness
of any remedy that the president could impose,” he said.
An LG spokesman said the
potential for new trade barriers played a role in the company’s increased washer shipments but denied it was
stockpiling. He said the company also weighed other factors including increasing demand, shifts in distribution
and new retail opportunities.
A spokeswoman said Samsung
Please see TRADE page A7
to get into the historic St. Michael’s Cathedral
in Qingdao one recent day, found he had no
cash for the 20-yuan admission, so he borrowed it from another man in line and immediately zapped him the amount by phone.
Behind the trend are internet titans Alibaba Group Holding Ltd. and Tencent Holdings Ltd., which are elbowing aside banks to
take a growing role in daily commerce. Their
success offers a glimpse of a future where
technology firms drive innovations in finance
just as they have in retailing, autos and the
media.
Though the U.S. saw $112 billion of mobile
payments in 2016, by a Forrester Research esPlease see CHINA page A8
Alibaba’s Ma meets hurdles in U.S.................... B12
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.
A2 | Thursday, January 4, 2018
THE WALL STREET JOURNAL.
* ****
U.S. NEWS
CAPITAL ACCOUNT | By Greg Ip
Hedge-Fund Titan Puts Away the Punch Bowl
tightened monetary policy
and extended the Great Depression. Today, the central
bank must balance the shortterm need for higher interest
rates to contain inflation
against the long-term need
for low rates to work off the
debt overhang and sustain
high asset prices.
“It becomes more and
more difficult to balance
those things as time goes
on,” Mr. Dalio said at his
Westport, Conn., office in
November. “It may not be a
problem in the next year or
two, but the risk of not getting it right increases with
time.”
“We ‘finance people’ see
the world very differently
from the way economists
do,” he writes in his book
“Principles,” published last
fall. The views of finance
people tend to be shaped
more by trading experience
than by formal economics.
They assign much more
weight to financial factors
such as debt, asset prices
and cash flow than do economists who emphasize “real
economy” factors such as
employment and investment.
Finance people are wary of
how macroeconomic data obscures crucial details of indi-
Fed Weighs Effect
Of Tax Cuts on Rates
BY NICK TIMIRAOS
WASHINGTON—Federal Reserve officials in December debated whether looming tax
cuts might require them to
raise short-term interest rates
more aggressively in 2018
than last year, when they
lifted borrowing costs three
times.
Officials expressed growing
confidence in the strength of
the labor market and the
economy, according to minutes
of the Fed’s Dec. 12-13 policy
meeting, which were released
Wednesday. Since the meeting,
Congress approved and President Donald Trump signed
into law a $1.5 trillion tax cut,
which could muddy the central
bank’s efforts to ensure the
economy stays on an even
keel.
After holding the fed-funds
rate near zero for seven years,
the Fed has raised it five times
since late 2015, most recently
in December, to a range between 1.25% and 1.5%. They
also penciled in three quarterpercentage-point rate increases in 2018 and two more
moves in 2019.
The Fed is likely to leave
rates unchanged at its next
meeting, Jan. 30-31.
The bigger question is how
much more the Fed will raise
rates through the rest of the
year, and the answer largely
turns on inflation.
If Fed officials see signs
that inflation is rising toward
their 2% target over time, they
could stick to their tentative
plan for three rate increases
this year. But if inflation
proves weaker, they could
move more slowly. And if price
pressures pick up more than
anticipated, policy makers
could act more aggressively.
At the meeting, officials
voted 7-2 to raise rates, with
two dissenting because of low
inflation.
U.S. WATCH
NEW YORK
UTAH
Berman Is Tapped for Mormon Church’s
U.S. Attorney’s Office Leader Dies at 90
Attorney General Jeff Sessions
appointed Geoffrey Berman, a law
partner of White House ally and
former New York Mayor Rudy
Giuliani, as temporary U.S. attorney in Manhattan, the Justice Department said.
Wednesday’s announcement
included 16 other interim top
prosecutors around the U.S.
In March, Mr. Sessions asked
all U.S. attorneys appointed by
President Barack Obama to resign, but the White House has
yet to nominate permanent successors for many.
The new appointments last
120 days and would need to be
made permanent by either a
judge or by a nomination from
the White House and confirmation by the Senate.
Mr. Berman is a partner at
Greenberg Traurig LLP.
—Aruna Viswanatha
The Tuesday night death of
Thomas S. Monson, the president of the Church of Jesus
Christ of Latter-day Saints, sets
up a shuffling of Mormon leadership.
Mr. Monson, 90 years old,
died at his Salt Lake City home
from “causes incident to age,”
the church said.
Although a successor likely
won’t be chosen until after Mr.
Monson’s funeral, the church
said, Russell M. Nelson, a 93year-old thoracic surgeon, is expected to become the next
church president.
Mr. Monson became the 16th
president of the church in 2008,
and during his tenure its worldwide membership grew to more
than 16 million members from
roughly 13 million, according to
the church.
—Ian Lovett
THE WALL STREET JOURNAL
(USPS 664-880) (Eastern Edition ISSN 0099-9660)
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Out From Under
Rock-bottom interest rates have helped the U.S. cope with massive
debts.
Level of private and
government debt as a
percentage of GDP
Debt service (interest plus
amortization) as a percentage
of GDP
500%
100%
400
80
300
60
200
40
100
20
0
1925 ’30
0
’50
’70
’90
’10
1927 ’30
vidual companies and households.
ne of Mr. Dalio’s first
big, correct calls was
that when the Fed
jacked up rates in 1981 to
slay inflation, it would trigger a crisis; the next year
Mexico’s default touched off
Latin America’s lost decade.
Then came a very wrong
call: that a depression would
follow. Instead, the Fed
slashed interest rates and
O
’50
’70
’90
’10
THE WALL STREET JOURNAL.
Source: Bridgewater Associates
sparked a spectacular recovery.
Such experiences drove
Mr. Dalio to comb through
economic and financial history in search of “timeless
and universal” principles.
As he sees it, since the
1970s, inflation-adjusted interest rates have steadily declined while investors have
accepted lower compensation for risks such as bankruptcy, recession and volatil-
ity (i.e. the “risk premium”
has declined). This directly
raises asset values and indirectly lifts growth by spurring borrowing. His team estimates this has contributed
3 percentage points a year to
stock returns since the 1970s
while boosting private and
government debt to 325% of
gross domestic product.
In 2007, Mr. Dalio’s team
concluded that the cost of
servicing Americans’ debts
was growing faster than
their cash flows, creating the
conditions for a crisis.
He doesn’t blame the Fed
for this. In fact, he praises it
for understanding exactly
what was needed when it
burst: By slashing short-term
interest rates to zero and
buying bonds, it engineered
the right combination of economic growth, debt writeoffs and low interest rates.
The problem is that with
interest rates and risk premia near all-time lows and
debt and asset values near
all-time highs, there’s little
fuel to repeat the process.
Just as the Fed can’t cut
rates much, it can’t raise
them much either, or debt
servicing would swamp cash
flow and asset prices would
sink. Thus Mr. Dalio sees
years of low interest rates,
and while he thinks stocks
are fairly valued, returns to
a typical stock-bond portfolio over the next decade will
be around zero after inflation and taxes.
W
hen Mr. Dalio
speaks, how closely
should you listen?
Since Bridgewater detailed
this thesis in 2016, events
haven’t exactly followed the
script. Last year, the S&P
500 returned 22% (including
dividends); Bridgewater’s diversified fund returned
about 12%. Mr. Dalio says the
promise of less regulation
and lower taxes have elevated stock valuations. But
that doesn’t translate into
higher long-term growth or
sustained returns, he says.
In fact, his biggest worry
is that lower corporate taxes
and higher stock prices do
nothing for the bottom 60%
of households who own almost no assets and whose
stagnant wages are the mirror image of expanding
profit margins, feeding resentment and political polarization. Says Mr. Dalio: “If
we do have an economic
downturn, I worry we will be
at each other’s throats.”
Ancient Infant’s Remains Help Unravel Genetic History
BEN POTTER/UNIVERSITY OF ALASKA FAIRBANKS HANDOUT
The U.S.
economy and
stock market
have just
turned in
their best performance in years, so it
seems like buzzkill to hand
the microphone to someone
who thinks the path ahead
could be much bleaker.
Still, when it’s Ray Dalio,
founder of hedge-fund manager Bridgewater Associates
LP, it’s worth listening.
That’s not so much because
of Bridgewater’s size and
success but because Mr. Dalio looks at the world
through a unique prism.
That prism explains how
his firm managed to anticipate and profit from the
2008 crisis. While he doesn’t
see another crisis in the offing, he does see the same
underlying stresses: Americans have accumulated far
more debt than they have assets and income to support.
Not only will this drag on
growth and markets, it will
leave the economy acutely
vulnerable to higher interest
rates. The relevant parallel,
he says, is not the early
1930s, when the economy
imploded, but the late 1930s
when the Federal Reserve
ICE-AGE ANCESTRY: DNA from an infant who died in Alaska some 11,500 years ago is giving scientists the best look yet at the
genetics of the ancestors of today’s native peoples of the Americas. The infant girl was buried near Fairbanks, and her remains are
the earliest known in the far north of North America, said anthropologist Ben Potter of the University of Alaska Fairbanks.
CARS
Continued from Page One
car makers to scale back production even more and
ratchet up discounts and rebates.
IHS expects sales to slip to
16.9 million vehicles this year,
which is still historically
strong for an industry long
exposed to far more volatile
boom-and-bust cycles.
“If you launched someone
from another planet and
landed them in America, you’d
have to say some pretty optimistic things looking at the
car business,” Scott Keogh,
Audi AG’s U.S. sales chief, said
Wednesday. However, he said
competitors could get burned
if the softer market leads to
an aggressive price war.
Executives have reasons for
optimism as employment
gains are leading to wage
growth in certain pockets of
the U.S. The federal tax cuts
and a robust stock market
could provide more spending
power for people in the mood
Monthly Vehicle Sales Over the Past Year
GM
Ford
Toyota
FCA
Honda
t3.3%
s1.3%
t8.3%
t11%
t7%
t9.5%
Dec. 308,539
240,910
222,985
171,946
149,317
138,226
THE WALL STREET JOURNAL.
Sources: the companies
for a new vehicle. “Many consumers will see their takehome pay rise because of tax
reform,” said General Motors
Co.’s chief economist, Mustafa
Mohatarem. “That will keep
the broad economy growing,
and help keep sales at very
healthy levels even as the Fed
increases interest rates.”
Toyota Motor Corp., issuing
a relatively rosy outlook on
the U.S. market, said sales
could top 17 million this year.
“We’re really bullish on 2018
and, as with anything, the
economy is going to keep fluctuating,” said Toyota’s U.S.
general manager, Jack Hollis.
Still, vehicle makers are reducing North American production, including a pullback
in the U.S., in anticipation of a
softer market. North American output is expected to fall
2.3% in the first quarter, according to WardsAuto.com, a
move aimed at trimming
dealer inventories and lowering the supply of sedans and
compact cars that are unpopular amid low fuel prices.
Because revenue is booked
as cars leave the factory, auto
executives need to exercise restraint on production to maintain profitability levels as the
car market slows. Ford Motor
CORRECTIONS AMPLIFICATIONS
The expansion rate in
China’s mobile-game market
may settle around the high
teens in percentage terms this
year, according to research
firm Newzoo. In some editions
Wednesday, a Heard on the
Street article about mobile
games in China incorrectly
said the rate may settle
around that range next year.
Geoffrey Greif, who was
cited in Tuesday’s Bonds col-
Nissan
umn on relationship advice
from readers in 2017, is a therapist and relationship researcher. The article incorrectly said that all the advice
came from readers who aren’t
therapists or researchers and
referred to the suggestions as
being offered this year.
Hoda Kotb is a graduate of
Virginia Polytechnic Institute
and State University, which is
popularly known as Virginia
Tech. A Media & Technology
article on Wednesday about
Ms. Kotb’s appointment as coanchor of NBC’s “Today” incorrectly identified the school
as Virginia Tech University.
A vintage white car in a
photograph of Brooklyn, N.Y.’s
Ocean Parkway that accompanied a Mansion article on Friday about homes along that
road was incorrectly identified
as a Rolls-Royce.
Readers can alert The Wall Street Journal to any errors in news articles by emailing wsjcontact@wsj.com or by calling
888-410-2667.
Co. and GM are expected to
outline their financial outlooks for 2018 later in January.
December sales fell 5.2%,
according to Autodata Corp.,
as the makers had one fewer
selling day and faced a stiff
comparison to December 2016.
The seasonally adjusted annual selling rate hit 17.9 million vehicles last month, the
latest in a string of relatively
robust monthly SAARs after a
sluggish start to 2017.
GM’s sales for the month
slipped 3.3% compared with
the same period a year earlier,
but the company posted solid
gains in pickup trucks and
crossover sport-utility vehicles. Ford reported a 1.3% increase in December, including
a 2% rise in sales of the company’s F-series pickups—the
nation’s top-selling model—
and an 8% increase in SUVs
sales.
GM and Ford, the two largest sellers in the U.S., are trying to manage a balancing act
of maintaining strong margins
while slowing production and
spending big to offer bargains.
Fiat Chrysler Automobiles
NV sales fell 11% to 171,946
vehicles in December, because
of a planned reduction in fleet
sales, down 42% from a year
earlier. Sales declined across
most of the maker’s brands.
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | A3
* * * * *
U.S. NEWS
Winter Storm Plows Up the East Coast
Thousands of airline
flights are canceled
and schools close as
snowfall totals mount
Airlines canceled flights and
schools closed on Wednesday
as a winter storm roared up
the East Coast, threatening to
bring heavy snow and strong
winds as far north as New
England.
The storm brought a deep
freeze to north Florida and record snowfall in coastal Georgia and South Carolina, where
the Charleston International
Airport shut down on Wednesday and officials asked drivers
to stay off roads.
School systems in Georgia,
Alabama and the Carolinas
canceled or postponed classes
Wednesday. Governors in
Georgia and North Carolina
declared states of emergency
and readied troops, trucks and
supplies to respond to potentially blocked roads and dangerous conditions.
Airlines had canceled nearly
500 flights in the U.S. by
Wednesday afternoon and
nearly 2,000 flights scheduled
for Thursday, according to
flight-tracking service FlightAware.com. In addition to
Charleston, flights in Atlanta
and Jacksonville, Fla., were
among those most affected.
Some flights to Boston and the
STEPHEN B. MORTON/ASSOCIATED PRESS
BY SUSAN CAREY
AND VALERIE BAUERLEIN
Work crews in trucks with the Georgia Department of Transportation plowed a section of Interstate 95 on Wednesday in Savannah.
New York area’s three airports
were also scrubbed.
Some carriers issued waivers allowing passengers scheduled to travel in the region on
Thursday or Friday to change
plans without paying a fee or
higher fare as long as they rebook travel by this weekend.
United Continental Holdings
Inc., the No. 3 U.S. airline by
traffic, offered waivers on
Wednesday for flights in 34
cities stretching from the
Southeast U.S. to Montreal.
Delta Air Lines Inc., the second-largest airline, was offering waivers for 12 airports,
and No. 1 American Airlines
Group Inc. had 18 Northeast
cities on its list. Southwest
Airlines Co. was offering rebooking options in 19 cities.
Winter storms tend to be
easier for airlines to predict
and track than summer thunderstorms. Carriers tend to
cancel flights well ahead of
blizzards to keep planes and
crews from getting stuck and
to keep passengers from arriving at the airport to find themselves stranded.
Bob Sparhawk, a software
developer in Boston, was planning to meet a friend in Wash-
Newly Hot Locales Battle
To Curb Cost of Housing
PHILADELPHIA—The gentrification of the Fishtown
neighborhood here looks like
something city planners
dream of, with developers renovating old row houses as
young professionals, along
with new restaurants and
businesses, pile in.
But home prices have shot
up so quickly in recent years
that the latest wave of young
professionals say they are having a hard time making the finances work.
Now several Philadelphia
City Council members want to
pass a law requiring property
developers to set aside 10% of
new projects as below-market
units, to improve overall affordability in a city that once
was among America’s biggest
bargains.
Soaring housing costs
aren’t confined to New York or
San Francisco. Cities including
Pittsburgh, Detroit, Buffalo
and Nashville all have explored
or adopted policies that, like
Philadelphia’s, seek to create
more cheap housing with an
approach known as inclusionary zoning.
Some developers say the
approach can backfire by making projects too expensive to
build, even with tax abatements or other compensation
for the added costs.
“It really underscores the
housing-affordability problem
is much more widespread than
simply a problem in the 10
most expensive coastal cities,”
said Stockton Williams, executive director of the Terwilliger
Center for Housing at the Urban Land Institute in Washington, D.C.
In Philadelphia, the downtown Center City area has experienced a residential building boom. In neighborhoods to
the north and south, an influx
of professionals has pushed up
values in historically workingclass neighborhoods.
Once-gritty Fishtown now
brims with art galleries and
pubs serving craft beer.
Since 2014, the median
home value in Fishtown has
jumped more than 50% to
around $250,000, according to
home-search website Zillow.
Parts of nearby Kensington
have had similar increases.
Yet census figures show
that about 400,000 of the
city’s 1.6 million residents live
under the poverty line, the
highest rate among the 10
most populous U.S. cities.
Lisa Wilcox had identified
Philadelphia as the city where
she would launch her new career as a speech-language pathologist.
The relatively cheap housing was a big draw—especially
compared with her native Boston as well as Seattle, where
she spent her 30s.
But when she arrived in
July, graduate degree in hand,
Ms. Wilcox found she no longer could afford to buy in
Fishtown. “It was kind of remarkable how much prices
had gone up in that short period of time,” said Ms. Wilcox,
41 years old. “It’s crazy.”
60%
SCOTT CALVERT/THE WALL STREET JOURNAL
BY SCOTT CALVERT
AND LAURA KUSISTO
Ms. Wilcox, who lives by
herself, wouldn’t benefit from
the proposed new law. With a
salary of nearly $60,000, she
earns too much.
Yet a house in her preferred
part of Fishtown seems out of
reach for $220,000, the maximum she feels she could afford.
While swaths of Philadelphia are considered affordable,
much of the city’s housing
stock is in bad shape and located in areas lacking jobs,
public transit and amenities
Voter Fraud
Commission
BY MICHAEL C. BENDER
ANITA SNOW/ASSOCIATED PRESS
The state of Washington is
suing Motel 6, alleging the
low-cost hotel chain repeatedly provided detailed information about guests to immigration authorities for at least
two years in violation of a
state consumer-protection law.
Washington Attorney General Bob Ferguson said on
Wednesday that at least six
corporate-owned hotels provided U.S. Immigration and
Customs Enforcement officials
daily lists of guests, including
their names, driver’s license
numbers, dates of birth and
room numbers. “The scale of
what Motel 6 was doing is
deeply disturbing to me,” Mr.
Ferguson said.
Officials at Motel 6, which
is owned by private-equity
firm Blackstone Group LP,
didn’t respond to requests to
comment on Wednesday. The
chain has said in the past that
it instructed hotel operators to
refrain from voluntarily and
routinely sharing guest information with federal immigration authorities.
Mr. Ferguson said Motel 6
committed more than 9,000
violations of the state’s Consumer Protection Act for what
he described as egregious privacy violations from about
Jan. 1, 2015, through September 2017. He said the company’s practice of voluntarily
sharing guest information also
violated the budget hotel
Washington state accuses the hotel company of privacy violations.
chain’s own privacy policy.
The state lawsuit, filed in
Seattle, seeks a permanent injunction to block the hotel
chain from sharing guest information without a warrant.
Washington officials said at
least six hotels in the state
routinely provided lists of
guests to ICE and at least six
people suspected of being in
the country illegally were detained as a result.
ICE spokeswoman Yasmeen
Pitts O’Keefe said Wednesday
the agency receives “viable enforcement tips from a host of
sources” but declined to discuss its possible interactions
with Motel 6. She added that
motels and hotels have “frequently been exploited by
criminal organizations engaged in highly dangerous illegal enterprises, including human trafficking and human
smuggling.”
The agency isn’t named as a
defendant in the lawsuit.
At least two Motel 6 operators in Arizona also have been
accused by immigration advocates of sharing guest information without a warrant or
subpoena.
In September the company
acknowledged that some properties in the Phoenix area
were voluntarily giving daily
guests lists to ICE. In a statement in the fall, the company
apologized and said the actions were “undertaken at the
local level without the knowledge of senior management.”
The company said it would
tell staff at all of its more than
1,400 locations in the U.S. that
they are prohibited from voluntarily providing such information to immigration authorities.
40
20
0
2014
’17
One trendy Philadelphia enclave was too pricey for Lisa Wilcox.
Motel 6 Is Sued Over Guest Data Trump Ends
BY ALICIA A. CALDWELL
AND CHRIS KIRKHAM
ington, D.C., on Thursday before receiving an email from
JetBlue Airways Corp. on
Wednesday informing him that
his flight had been canceled.
He couldn’t rebook on JetBlue’s website so he purchased
a new ticket on Friday for
$450, more than the $215 he
paid for his original trip. He
said he hoped to call JetBlue
on Thursday to get some of his
money back.
The National Weather Service said snowfall will increase
in portions of the mid-Atlantic
states and northern New England through Wednesday night
and into Thursday. The forecast calls for up to 12 inches of
snow from Virginia to Boston
and up to 18 inches possible in
northern New England.
The storm could produce
enough wind to down trees
and lead to power outages, the
Weather Service warned.
Coastal flooding is possible,
particularly on Thursday.
Meteorologists said they expect the storm to undergo
“bombogenesis”: a quick
strengthening of a cyclonic
low-pressure area into an explosive development, also
known as a weather bomb.
Dare County, N.C., Commissioner Danny Couch said he
heard people testing generators on Wednesday as he drove
along his Outer Banks district,
and saw others tying trash
cans to trees and dashing out
for bread and milk.
—Imani Moise
contributed to this article.
WASHINGTON—President
Donald Trump dissolved the
commission he created just
eight months ago to investigate his unsubstantiated
claims of voter fraud in the
2016 election, bringing an end
to a panel that had faced resistance from state officials.
Mr. Trump formed the Presidential Advisory Commission
on Election Integrity in May
and installed Vice President
Mike Pence as chairman after
blaming voter fraud for his
loss in the popular vote to
Democratic nominee Hillary
Clinton. The panel was created
despite independent experts
saying there was no evidence
to support his claim of widespread fraud.
“I won the popular vote if
you deduct the millions of
people who voted illegally,”
Mr. Trump said in a Twitter
message about three weeks after the election, without providing any evidence. He later
said he wanted an investigation into whether votes were
cast illegally by people voting
twice, voters using deceased
people’s names, or by undocumented immigrants.
On Wednesday, the White
House blamed the panel’s demise on states that refused to
provide voter information.
such as parks.
“We don’t necessarily have
an affordable-housing crisis,
we have a quality affordablehousing crisis,” said Andrew
Goodman, community engagement director at the nonprofit
New Kensington Community
Development Corp., which
backs the inclusionary zoning
bill.
The administration of
Mayor Jim Kenney, a Democrat, supports the goals but
says the bill would set rents
too low to cover construction
and other developer costs.
Leo Addimando, managing
partner at the Alterra Property Group and vice president
of the city’s Building Industry
Association, said he supports
mixed-income housing but
thinks the council’s proposal
would worsen the imbalance
between the city’s high construction costs and comparatively low rents, yielding fewer
new housing units.
“This will certainly slow
down residential development,” Mr. Addimando said.
.
A4 | Thursday, January 4, 2018
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THE WALL STREET JOURNAL.
U.S. NEWS
Manafort Sues Special Counsel Mueller
Former campaign chief
alleges investigation
exceeded scope of
original Russia inquiry
between the Russian government and the Trump campaign,
as well as any issues arising
from that inquiry.
It also seeks to toss the indictment against Mr. Manafort
and requests an order barring
Mr. Mueller from pursuing similar investigations.
A spokesman for Mr. Mueller
declined to comment. A Justice
Department
spokeswoman
called the suit “frivolous.”
The lawsuit is an unusually
aggressive salvo against the
special counsel, questioning the
source of his authority and his
right to conduct a wide-ranging
investigation. It foreshadows
what are likely to be a series of
legal moves on all sides as Mr.
Mueller, who has charged four
individuals, pursues his probe.
Some legal analysts said the
BY DEL QUENTIN WILBER
Paul Manafort, a former
chairman of the Trump presidential campaign, filed a lawsuit Wednesday alleging that
special counsel Robert Mueller
had exceeded his authority in
indicting Mr. Manafort on
money-laundering and tax-related charges.
The lawsuit asks a federal
judge in Washington to throw
out the order issued by Deputy
Attorney General Rod Rosenstein in May that appointed Mr.
Mueller to investigate any links
Manafort lawsuit faces an uphill
battle, since judges often defer
to the Justice Department on
the framework of criminal investigations.
Mr. Manafort and a longtime
business associate, Richard
Gates, were indicted in October
by a grand jury working with
the special counsel’s office. Mr.
Manafort served as Donald
Trump’s campaign chairman for
several months during 2016,
and Mr. Gates served as a campaign official.
That indictment didn’t touch
on the Trump campaign. Instead, it alleged a wide-ranging
scheme, involving foreign companies and bank accounts, to
use millions of dollars in income from Ukraine in the U.S.
without reporting it.
Messrs. Manafort and Gates
have pleaded not guilty.
Mr. Mueller has also obtained guilty pleas from Michael
Flynn, Mr. Trump’s former national security adviser, and
George Papadopoulos, a former
The unusually
aggressive salvo
foreshadows a likely
series of legal moves.
Trump campaign aide. Both admitted lying to the Federal Bureau of Investigation.
Mr. Rosenstein’s order appointing Mr. Mueller—which
came from the deputy attorney
general because Attorney Gen-
Two New Democratic Senators Are Sworn In
eral Jeff Sessions, who played a
high-profile role in the Trump
campaign, recused himself from
the investigation—permitted
the special counsel to investigate not only Russian electoral
interference but “any matters
that arose or may arise directly
from the investigation.”
Messrs. Mueller and Rosenstein were both named as defendants in Mr. Manafort’s lawsuit, which says the accusations
against him weren’t uncovered
by Mr. Mueller and “had no
connection whatsoever to the
2016 presidential election.”
The indictment “is completely unmoored from the special counsel’s original jurisdiction,” the suit says.
The lawsuit asserted that a
law creating “independent
counsels,” who were appointed
by three-judge panels, expired
in 1999 amid a widespread recognition that it gave prosecutors too much power.
In replacing the law with
regulations allowing the attorney general to name special
counsels, the Justice Department issued rules that “carefully circumscribe that appointment authority and the scope of
any appointments under it,” the
lawsuit said.
“The Appointment Order in
effect purports to grant Mr.
Mueller carte blanche to investigate and pursue criminal
charges in connection with anything he stumbles across while
investigating,” the suit said.
Russia has denied it sought
to meddle in the 2016 campaign, and Mr. Trump has called
the probe a “witch hunt.”
Trump Takes Aim
At Clinton Aide
A HUG BEFORE THE CEREMONY: Sen. Tina Smith of Minnesota ran into Sen. Doug Jones of Alabama outside the Senate chamber in
Washington, D.C., before they were sworn in on Wednesday. Ms. Smith was appointed to succeed former Sen. Al Franken, who
resigned amid sexual-misconduct accusations. Mr. Jones won an upset victory over Republican Roy Moore in a recent special election.
Immigration Debate Complicates Budget Talks
BY KRISTINA PETERSON
leaders met with senior White
House officials Wednesday afternoon. The talks were complicated, they indicated, by a
debate over how to reach a
deal aimed at aiding young
undocumented immigrants
and tightening border security.
The tenor of the meeting
was “surprisingly good,” Senate Majority Leader Mitch
McConnell (R., Ky.) told senior
Republicans, Sen. John Cornyn
(R., Texas) said.
A group of Senate Republicans planned to meet Thursday
with President Donald Trump to
WASHINGTON—Congressional leaders emerged Wednesday from a meeting with
White House officials without
a budget deal, as Democrats
intensified their push to reach
an immigration agreement as
part of the negotiations.
Lawmakers returning to
Washington from their holiday
break have less than three
weeks before the government’s
current funding expires at
12:01 a.m. on Jan. 20.
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discuss immigration, Mr. Cornyn
said. The GOP president’s support is seen as key to reaching
an immigration agreement.
“It is important that we
achieve a two-year agreement
that funds our troops and provides for our national security
and other critical functions of
the federal government,” the
White House, House Speaker
Paul Ryan (R., Wis.) and Mr.
McConnell said in a joint
statement after the meeting.
The statement also issued a
warning to the Democrats: “It
also remains important that
BANNON
Continued from Page One
side the Trump White House” by
Michael Wolff. In the book, Mr.
Bannon sharply criticizes the
president’s adult children and
son-in-law Jared Kushner, all of
whom Mr. Bannon sparred with
during his six months inside the
administration.
In the book, Mr. Bannon is
quoted as describing Ivanka
Trump, the president’s daughter
and a White House adviser, as
“dumb as a brick.” A spokeswoman for Ms. Trump didn’t respond to a request for comment.
Mr. Bannon declined to comment. A person close to him said
Mr. Bannon didn’t deny his
quotes in the book.
White House press secretary Sarah Sanders called the
book “trashy tabloid fiction”
that was “filled with false and
misleading accounts.”
Late Wednesday, an attorney
for Mr. Trump and his campaign sent a letter to Mr. Bannon demanding that he “cease
and desist” making disparaging
statements to the news media
about Mr. Trump and his family.
The letter from attorney
Charles Harder said that Mr.
Bannon violated the terms of
his employment agreement
with the Trump campaign by
making the comments.
In the five-page letter, Mr.
Harder wrote that under the
terms of the agreement, Mr.
Bannon promised that while
working for the campaign “and
at all times thereafter” he
would not “demean or dispar-
members of Congress do not
hold funding for our troops
hostage for immigration policy.”
Democrats signaled this
week that they intend to use
their leverage in budget negotiations to demand legal protections for the so-called
Dreamers, young people living
in the U.S. illegally who were
brought here as children.
Democratic votes will be
needed to pass the spending
bill in the Senate, where 60
votes are required to clear
procedural hurdles. The GOP
holds 51 seats in the Senate.
age publicly” Mr. Trump and his
family, among others.
A publicist with Henry Holt,
the imprint of Macmillan publishing the book, didn’t respond to a request for comment. Mr. Wolff didn’t
immediately respond to a request for comment.
Mr. Bannon resigned his post
in August shortly after John
Kelly was named White House
chief of staff with a mandate to
bring more discipline to the
West Wing. Mr. Bannon since
then has positioned himself as a
minter of conservative candidates heading into the 2018 midterms. He returned to the conservative Breitbart website,
where he is executive chairman.
Mr. Bannon supported Roy
Moore in the Alabama Senate
race, while Mr. Trump backed
another Republican candidate,
Luther Strange, in the party primary before ultimately backing
Mr. Moore in the general election. Mr. Moore lost that race to
Democrat Doug Jones.
Mr. Trump has had public
fallouts with various people, including lawmakers, in the past,
some of which he has later
patched up. A permanent rift between the president and Mr.
Bannon could have political implications leading up to November’s midterm elections and into
2020. A battle for the president’s political base could divide
the conservative movement, especially if Mr. Trump begins to
align himself more with the GOP
establishment, which views Mr.
Bannon with the same level of
enmity as he does.
In his statement, Mr. Trump
played down Mr. Bannon’s role
MARK MAKELA/GETTY IMAGES
WASHINGTON—President
Donald Trump suggested this
week that a confidante of his
former Democratic rival, Hillary Clinton, should be jailed,
alleging that she had endangered national security by forwarding her government-computer passwords to her
personal email account.
Huma Abedin, a long-serving aide to Mrs. Clinton, forwarded the login instructions
for her State Department laptop to a personal email account
in August 2009, according to
documents released by the department last week.
Ms. Abedin, who was deputy
chief of staff to Mrs. Clinton
while the latter was secretary
of state, had received usernames, passwords and login instructions for government
email and document systems
from a State Department colleague on Aug. 18, 2009. Six
days later, she forwarded the
instructions to her personal
email account.
The emails Ms. Abedin sent
and received were found on
the laptop computer of her estranged husband, Anthony
Weiner, a former Democratic
congressman, during an unrelated investigation and were
released publicly as part of a
Freedom of Information Act
lawsuit brought by the conservative group Judicial Watch.
Former officials said passwords to State Department
systems, even those used to access unclassified information,
were considered sensitive and
mishandling them was grounds
for internal discipline but
wouldn’t typically prompt a
criminal inquiry. The email in
question, as released by the
Ex-Clinton staffer Huma Abedin
State Department last week,
didn’t contain redaction markings indicating the presence of
classified information.
In a tweet on Tuesday, Mr.
Trump wrote that Ms. Abedin
“has been accused of disregarding basic security protocols,” claiming that she put
classified passwords “into the
hands of foreign agents.”
Ms. Abedin hasn’t been formally accused of wrongdoing
and has been out of government since 2013. No evidence
has emerged that Ms. Abedin’s
passwords wound up in the
hands of foreign agents.
One of the passwords she
forwarded was for commercially available software used
by the State Department for
unclassified systems. The
email also contained a PIN to
access the State Department’s
Open Net Everywhere system
for using unclassified email
remotely.
A
State
Department
spokeswoman declined to
comment on whether the
State Department believed
Ms. Abedin had broken any
rules, saying “this matter is in
ongoing litigation.”
An attorney for Ms. Abedin
didn’t respond to a request to
comment.
JONATHAN BACHMAN/REUTERS
GLEN STUBBE/MINNEAPOLIS STAR TRIBUNE/ZUMA PRESS
BY BYRON TAU
AND FELICIA SCHWARTZ
Former Trump strategist Steve
Bannon in Alabama last month.
in the Trump movement: “Steve
had very little to do with our
historic victory…. Yet Steve had
everything to do with the loss of
a Senate seat in Alabama.”
Mr. Trump also charged that
Mr. Bannon portrayed himself as
more influential than he actually
was. “Steve was rarely in a oneon-one meeting with me and
only pretends to have had influence to fool a few people with
no access and no clue, whom he
helped write phony books,” Mr.
Trump said.
Mr. Bannon described the
June 2016 Trump Tower meeting between the president’s oldest son and top advisers and a
Russian lawyer as “treasonous”
and “unpatriotic.”
Donald Trump Jr. has denied
he did anything wrong in agreeing to the meeting, in which the
campaign had been promised
negative information about
Democratic presidential candidate Hillary Clinton. He said no
useful information emerged
from the meeting.
Donald Trump Jr. tweeted
Wednesday: “Steve had the
honor of working in the White
House & serving the country.
Unfortunately, he squandered
that privilege.”
In the book, Mr. Bannon
sharply criticized Mr. Kushner
and former campaign chairman
Paul Manafort, for taking part in
the Russia meeting along with
Donald Trump Jr.
“Even if you thought that
this was not treasonous, or unpatriotic…and I happen to think
it’s all of that, you should have
called the FBI immediately,” Mr.
Bannon is quoted in the book.
Further, Mr. Bannon predicted that the investigation by
Mr. Mueller will focus on
money laundering.
“This is all about money
laundering,” Mr. Bannon told
Mr. Wolff. The path to “Trump
goes right through Paul
Manafort, Don Jr. and Jared
Kushner,” he said. “It’s as plain
as a hair on your face.”
A spokesman for Mr. Kushner didn’t respond to a request
for comment. A spokesman for
Mr. Manafort declined to comment. Mr. Manafort pleaded not
guilty in October to charges
stemming from lobbying work
he performed for the ruling
party of Ukraine as well as attempts to allegedly hide the
payments from that work.
—Michael C. Bender
and Peter Nicholas
contributed to this article
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | A5
WORLD NEWS
North Korea Reopens Hotline With South
Seoul seeks talks next
week with Pyongyang,
as a thaw appears in
their fraught ties
South Korean army soldiers on patrol across the demilitarized zone from North Korea. The two nations have technically been in a state of war since the 1950s.
Mr. Trump’s tweet caused
consternation across the political spectrum in Washington.
“It’s a very serious issue
and I don’t know how anybody’s interests are served by
escalating that rhetoric,” Senate Majority Whip John
Cornyn (R., Texas) said
Wednesday about Mr. Trump’s
tweet. “I do think it’s really important to try and come up
with a diplomatic solution.”
“Not my style,” Sen. Rob
Portman (R., Ohio) said of Mr.
Trump’s provocative tweets,
while noting progress in dealing
with Pyongyang. “For the first
time, they’re willing to sit down
and have a dialogue with South
Korea, which is a positive in my
view,” he said.
Democrats warned that Mr.
Trump’s casual use of threatening tweets was destabilizing the
U.S. and tarnishing its reputation.
“Where we have serious issues to address abroad, President Trump seems happy with
Seoul’s Move
Highlights Concern
Over Cost of a War
The reactivation of South
Korea’s telephone hotline with
North Korea underscored its
leaders’ concerns that their
country, which has developed
into an economic powerhouse
since the Korean War, has the
most to lose from any conflict.
Seoul, its prosperous and
densely populated capital, is
about 35 miles from the demilitarized zone, within range
of North Korean artillery and
rockets.
Estimates of casualties in
the event of widespread hostilities could run into the millions.
South Korea’s capital lies close
to the North Korean border.
macho boasts and belligerent
threats that will get us nowhere,” Senate Minority Leader
Chuck Schumer (D., N.Y.) said in
the Senate, cautioning that
China could draw advantage.
“If President Trump continues snubbing our allies and
recklessly threatening other nations, and showing leadership
on the world stage that can
only be described as puerile,
the world may look to Beijing,
rather than Washington, for international leadership,” he said.
On Wednesday the State Department said the administration didn’t object to the re-establishment of the link between
the North and South, but remains committed to a pressure
campaign aimed at choking off
funds that help supply Pyongyang’s weapons programs.
“We are fine with them having that conversation, certainly
over the phone. They’re neighbors. Neighbors have a right to
have those types of conversations,”
State
Department
spokeswoman Heather Nauert
told Fox News. “They have a lot
of areas of mutual concern,” including the Olympics, she said.
China, the North’s ally and
largest trading partner, welcomed the moves by Pyongyang
and Seoul, saying it hoped the
rivals would try to “meet each
other halfway.” Beijing hopes
“all sides concerned will seize
this positive turn of events,”
Chinese Foreign Ministry
spokesman Geng Shuang told
reporters.
CHUNG SUNG-JUN/GETTY IMAGES
SEOUL—North Korean and
South Korean officials tested a
special hotline for the first time
in almost two years Wednesday,
signaling a tentative thaw on
the divided peninsula and highlighting possible differences between Seoul and Washington
over how to deal with a nuclear-armed Pyongyang.
The reactivation of the telephone link across the demilitarized zone—severed by the
North in 2016—came as South
Korea’s government moved
swiftly to follow up on a New
Year’s Day suggestion by North
Korean leader Kim Jong Un that
he would be open to talks.
North Korea dialed the South
and the call lasted about 20
minutes, according to the South
Korean unification ministry.
“Hello, this is [name] speaking,” were the first words from
a North Korean official on the
line, according to the ministry,
which didn’t release the North
Korean official’s name or a full
transcript. The unification ministry said the call was conducted between staffers to ensure that the line was usable.
Seoul has proposed a faceto-face meeting next week on
the North’s possible participation in the winter Olympic
Games being hosted in the
South in February. South Korean officials have said they
also want to discuss the North’s
atomic-weapons
program,
which has made significant advances in the past year.
The tenor of the South’s outreach offered a contrast to the
tone of U.S. President Donald
Trump, who tweeted on Tuesday that he had a “Nuclear Button” that “is a much bigger &
more powerful one” than one
Mr. Kim described in a New
Year’s Day speech.
CHUNG SUNG-JUN/GETTY IMAGES
BY ANDREW JEONG
Chun Yung-woo, a former
South Korean presidential national security adviser, said a
central question is what conditions the North would attach to
any participation in the Winter
Olympics. Pyongyang has railed
against annual U.S.-South Korea
military exercises planned for
March—which would coincide
with the Paralympics—and
could seek their cancellation.
Mr. Chun warned that postponing the exercises would hurt
the alliance and canceling them
would inflict more lasting damage because it would breach
trust between Seoul and Washington. “If the North asks for a
cancellation of this year’s military exercises, it would not be
advisable to invite the North
Koreans to the Olympics, and
compromise South Korea’s military readiness,” Mr. Chun said.
—Felicia Schwartz
and Kristina Peterson
in Washington
and Lingling Wei in Beijing
contributed to this article.
syneoshealth.com
SHORTENING THE DISTANCE
FROM LAB TO LIFE.
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INC Research/inVentiv Health has become Syneos HealthTM, a professional services organization with
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.
THE WALL STREET JOURNAL.
A6 | Thursday, January 4, 2018
WORLD NEWS
Lag in Deal’s Payoff Fuels Iran Protests
An expected windfall
from the lifting of
international sanctions
has been weak
With Iran’s economy in a
free fall earlier this decade,
Tehran gambled on accelerating talks with the international community to remove
By Asa Fitch in Riyadh,
Saudi Arabia, and
Jared Malsin in Dubai
nuclear-related sanctions in
the hope that reopening the
country’s doors to foreign
business could lift livelihoods.
That bet has yet to pay off.
Two years after the landmark
nuclear deal between Iran and
six world powers took effect,
many Iranians are on the
street protesting, in part because the economic windfall
from sanctions relief never
fully materialized.
Consumer prices are rising
at a double-digit clip—the price
of eggs has risen by more than
50% in the past year, Iranian
media reported last month. And
Iran’s currency has lost about
one-tenth of its value against
the dollar since May, crimping
Iranians’ spending power for
foreign goods they covet.
“The regime over-promised
and the deal under-delivered,”
said Rob Malley, a former special assistant to President Ba-
leadership places high taxes
on imports to encourage local
production. Many Iranians use
American technology, including smartphones, but they are
expensive because they can’t
be directly imported.
The Iran nuclear deal, a central foreign-policy objective of
the Obama administration,
promised to relieve the Persian
nation from its international
isolation. For European countries that took part in the
agreement, it also presented an
opportunity to invest in and
trade with a newly opened market of around 80 million people.
The deal took effect in early
2016. Iran’s gross domestic
product rose by 12.5% that year.
But the economy still faces
struggles, and polls indicate
that many Iranians haven’t felt
the benefits. While Mr. Rouhani
has brought inflation down
from nearly 40% under his predecessor, it is still running at
about 10%. And while Mr. Rouhani wants to create hundreds
of thousands of jobs in the
coming year, unemployment
still stands at 12%.
The election of Donald
Trump as U.S. president has
only made Mr. Rouhani’s job
harder. Mr. Trump, a staunch
opponent of the nuclear deal,
has sought to undermine the
pact, imposing fresh rounds of
sanctions targeting Iran’s ballistic missile program.
—Zeke Turner in Berlin
contributed to this article.
Uneven Recovery
Iran ratcheted up oil production in 2016 after the lifting of sanctions under the nuclear deal. But after an initial boost, economic growth has
slowed. Unemployment and inflation remain in the double digits, and its currency continues to falter.
Oil production,
in barrels a day
GDP,
annual change
5 million
15%
4
10
3
5
2
0
Unemployment
rate
Annual
inflation
20%
30%
0
–10
2000
’10
’16
15
’10
’17*
20,000
10
30,000
5
0
2000
10,000
20
5
–5
0
25
15
10
1
Iranian rials per dollar,
monthly
0
2000
’10
’17*
40,000
2000
’10
’17*
2000
’10
’18
THE WALL STREET JOURNAL.
*Estimates Sources: BP Statistical Review; IMF; FactSet
rack Obama and now the president and chief executive of
International Crisis Group.
“The over-promising reflected
both their genuine expectation
of greater returns from the
deal and a desire to hype its
anticipated benefits to sell it
to their domestic detractors.”
The economic troubles
show not only how Iran’s revival after the nuclear deal has
fallen short of expectations,
but how any business that is
being done is leaving out large
portions of the Iranian public,
particularly the working class.
Unlike mass protests that
broke out in 2009 over what
many saw as political injustice
Scale inverted
in the disputed re-election of
hard-line Iranian President
Mahmoud Ahmadinejad, protests now are tied to economic
injustice.
Among the chants hurled
by protesters at the ruling establishment have been cries of
“Bread, job, freedom” and “No
to inflation.”
“The inflation is really unfair,” said Ali, a 38-year-old
civil construction engineer
from Tehran. He said Iran’s
economic malaise was in some
ways out of current Iranian
President Hassan Rouhani’s
control, “but they could have
stopped the deterioration
through better policies.”
Antigovernment protests
continued for a seventh day
Wednesday, after large progovernment rallies across Iran
in the morning. Government
employees, national oil company workers and students at
state-run schools received orders from their superiors to
participate in the pro-government demonstrations, according to messages shared on social media.
More than 20 people have
died in the unrest, and authorities have arrested hundreds.
Gen. Mohammad Ali Jafari, the
commander of the Islamic
Revolutionary Guard Corps,
said Wednesday that the “se-
dition” of recent days was
over, and sought to minimize
the scale of the protests.
Iran’s economy has largely
been inwardly focused since
the country’s revolution in
1979. The revolution was
closely followed by a hostage
crisis in which 52 Americans
were held for more than a
year, an event that drove a
deep wedge between the two
countries and continues to
hang over relations.
Today, American cars made
after the revolution are virtually nonexistent and streets in
Tehran and other cities are
dominated by boxy Iranianmade models because the
Demonstrations Challenge Islamic Republic at Its Core
The protests that spread
like wildfire across Iran have
caught everyone by surprise:
the Iranian regime, its foreign foes and allies, and even
the liberal Iranians who supported the Green Movement
demonstrations of 2009.
The so-far leaderless protests have already exposed
a major internal weakness
of the Islamic
Republic just
as it enjoyed
unprecedented regional sway, with
significant military and political successes in Syria,
Iraq and Lebanon following
the defeat of Islamic State.
How the Iranian regime—
with its struggle between relative conservatives and reformers amid the looming
succession of 78-year-old Supreme Leader Ali Khamenei—
responds to this challenge
will influence the entire Middle East in coming months.
While a brutal crackdown
could stamp out the current
unrest, it could also provoke
REUTERS
MIDDLE EAST
CROSSROADS
By Yaroslav Trofimov
People protest in Tehran, which has yet to see anything resembling the massive marches of 2009.
an insurgency or even civil
war, a nightmare scenario
for European nations that
fear another refugee wave.
Yielding to some of the protesters’ demands could end
up liberalizing the Iranian
system and bolster reformers—but, if taken as a sign of
weakness, it may also precipitate an even more violent
confrontation down the road.
Iran’s wave of protests initially erupted in the eastern
city of Mashhad—a stronghold of the Islamic conserva-
tives—and targeted the austerity policies of President
Hassan Rouhani, a leader of
the reformist camp within
the regime.
I
n a matter of days, however, the protests took
on a life of their own in
disadvantaged provincial
towns across Iran. There, anger has been building over
endemic corruption, economic mismanagement and
the lack of an expected
windfall following the 2015
nuclear agreement with international powers.
These fresh protests are
targeting not just Mr. Rouhani’s camp but the entire
government system of the Islamic Republic. In town after
town, protesters destroyed
images of Mr. Khamenei,
criticized Iran’s involvement
in Syria and other foreign
wars and even chanted slogans calling for a return to
the monarchy overthrown in
the 1979 revolution.
“What started as anti-
Tehran has yet to see anything resembling the massive
marches of 2009.
In part that is because the
protesters in out-of-the-way
towns are often angry not
just with the Shiite clerical
establishment that effectively rules Iran, but also
with the privileged elites of
northern Tehran. Those uneasy with these protests include many of the relative
reformers who supported the
Green Movement in 2009
and voted for Mr. Rouhani in
last year’s elections—but
don’t want Iran’s entire
post-1979 system toppled.
Rouhani opposition sparking
protests focused on poor
economic performance by
the government has spiraled
into something where the
majority appear to be very
angry people who no longer
believe in the system altogether,” said Ellie Geranmayeh, a senior policy fellow
at the European Council on
Foreign Relations. “The demonstrations are turning more
violent and their chants are
turning more radical and extreme.”
While dozens of deaths
have been reported, so far
the Iranian security forces
have been responding with
more restraint than they
showed in 2009. Mr. Rouhani
has said that Iranians have
the right to express their
grievances and protest. Both
he and Mr. Khamenei, however, accused Iran’s foreign
enemies of instigating the
demonstrations as part of a
conspiracy to undermine the
Islamic Republic. On
Wednesday, the government
organized massive rallies to
show popular support for
the regime.
So far, Iran’s antigovernment protests haven’t drawn
as many people as the 2009
Green Movement, which was
fueled by a belief that Iran’s
presidential election that
year had been stolen by the
conservatives’ candidate,
Mahmoud Ahmadinejad. Unlike those protests, the current unrest is also largely occurring in the provinces:
M
any Iranians, after all,
are all too aware of
the tragedies that befell Syria after that country’s
regime attempted to crush
similar protests in 2011. More
than six years later, the Syrian civil war continues, with
more than half of the population forced from their homes
and more than half a million
Syrians killed.
As in Syria, the Iranian regime is unlikely to yield to
demands that endanger its
very survival, said Amir
Toumaj, Iran analyst at the
Foundation for Defense of
Democracies, a conservative
think tank in Washington.
“What the regime will do
is to try to double down and
fight until the end,” Mr.
Toumaj said. “These guys
will do it even if this means
that they will have to burn
down the whole country.”
ETHIOPIA
Political Prisoners
Set to Be Released
In a bid to quell a rising tide
of unrest in East Africa’s mostpopulous country and one of the
world’s fastest-growing economies, Ethiopia said it would release thousands of political prisoners and shut a notorious
detention center known for torture and abuses.
Prime Minister Hailemariam
Desalegn told reporters from
state-controlled media in the
capital, Addis Ababa, on Wednesday that the Ethiopian People’s
Revolutionary Democratic Front,
or EPRDF, the ruling coalition he
leads, will drop charges against
political prisoners and will pardon
those who have been sentenced.
Mr. Desalegn also said he
planned to close Maekelawi, a
detention center in northern Addis Ababa, and said the government planned to turn it into a
museum.
State media reported that Mr.
Desalegn said the decision was
a step toward fostering national
reconciliation and creating conditions for political dialogue after
nearly two years of escalating
unrest.
Growing protests have been
led by some of the country’s
ethnic groups, including the largest, the Oromos, and the smaller
Amharas. They have felt aggrieved for being cut out of the
country’s financial prosperity and
political processes, and for being
targeted in a violent government
crackdown.
Opposition figures welcomed
the news cautiously.
Beyene Petros, chairman of
Medrek, the biggest opposition
coalition, said the reports were
“music to my ears,” but that he
would believe them when he
saw them materialize.
“Our demand to release political prisoners has been there all
along,” he said, adding that his
own deputy has been incarcerated for more than a year.
—Matina Stevis-Gridneff
and Yohannes Anderbir
MEXICO
Gasoline Prices
Increase Unevenly
Consumers began the new
year paying varying prices for
gasoline in the newly competitive retail market, causing fears
ROGAN WARD/REUTERS
WORLD WATCH
FOLLOWERS: Members of the Shembe faith (Nazareth Baptist Church), a hybrid of traditions,
walked in procession during their annual pilgrimage near Inanda, South Africa, on Wednesday.
of rises like the ones that
sparked protests a year ago.
In central Mexico, including
Mexico City, regular gasoline
prices rose 1.3% between Nov.
30 and Jan. 2, while premium
gasoline prices were up 1.1%, the
Energy Regulatory Commission
said. Nationwide, prices averaged
16.13 pesos a liter for regular
gasoline, equivalent to about
$3.17 a gallon, and 17.83 pesos a
liter for premium.
Gas stations in Mexico City
reported selling regular gasoline
at more than 17 pesos a liter
and premium above 19 pesos.
In January 2017, the government raised fuel prices by as
much as 20% to eliminate subsidies and prepare the market for
competition, leading to widespread protests.
Subsequently, it granted fuelimport licenses to private companies and allowed service stations to open under banners
other than that of the state oil
company, Petróleos Mexicanos.
—Anthony Harrup
FRANCE
President Champions
Strong Press Liberty
President Emmanuel Macron
came out in support of press
freedom and announced a bill to
combat the spread of fake news
during election campaigns.
In a speech Wednesday to
journalists at the Élysée Palace
in Paris that laid out his agenda
for 2018, Mr. Macron said press
freedom is “the highest expres-
sion of freedom.”
He said he would soon propose a new law to combat fake
news on the internet during
French election campaigns.
“Journalists are the first to be
threatened by propaganda,” he
said.
Websites would have to say
who is financing them and the
amount of money for sponsored
content would be capped, Mr.
Macron said.
In the case of fake news,
emergency legal action could allow authorities to suppress that
content or even block access to
the website, Mr. Macron said.
He denounced the fact that
“there is a financial strategy
aimed at fostering doubt, forging
alternative realities, that allows
people to think that the media
and politicians always are more
or less deceptive.”
Mr. Macron also said France
and the European Union should
consider “the consequences” of
the recent U.S. decision to eliminate net-neutrality protections.
He did not elaborate. “Press
freedom is not only attacked by
dictatorships, it is also battered
in countries that are democracies,” he said.
—Associated Press
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | A7
WORLD NEWS
BY VALENTINA POP
BRUSSELS—Europe,
for
centuries a patchwork of warring kingdoms and principalities, is again showing its colors.
Today,
resurgent
nationalism and regionalism
are evident in a mushrooming
of historical local flags.
Catalan separatists are flying the nearly century-old Estelada, an unofficial flag with a
white star on a blue triangle—a
symbol of independence from
Spanish rule—above the redand-yellow
striped
official Catalan flag. German farright protesters have revived a
flag designed by a critic of
Adolf Hitler. Hungary’s far right
uses a 1,000-year-old standard.
Much as some from the U.S.
South have clung to the Confederate flag as an embodiment of their identity, so are a
growing number of political
groups across Europe.
“The tendency we can observe over the past four or
five years is that more regions
and communities in Europe
are adopting flags,” said
Michel R. Lupant, the director
of the Belgo-European Center
of Flag Studies.
Even in France, exceptional
for its centralized state structure, regions like Normandy,
Corsica and Alsace are bring-
ing back their historical flags,
Mr. Lupant notes.
Northern Ireland, which remained part of the U.K. when
the rest of Ireland broke away
in 1922, has long used flags to
signify pro-British and proIrish communities.
Flying paramilitary groups’
flags is illegal in the region so
historical flags are flown,
“even though everyone there
at a local level know what they
stand for,” said Dominic Bryan,
a researcher with Queen’s University Belfast.
“To some extent, flags can
be an alternative version of
war,” he said.
The trend spread notably in
2014, when Scotland held an
independence
referendum,
said Paul Noble, a commercial
director with Specialised Canvas Services Ltd., which owns
Flagmakers, one of Britain’s
largest
flag
producers.
“There’s definitely a correlation between an interest in national issues and a spike in
flags of that nation,” he says.
One flag that is meeting
mixed success is the EU’s circle of gold stars on a blue
background. Catalan and Scottish separatists fly it at their
rallies, but most nationalist
movements—including
in
France, the Netherlands and
Poland—want nothing of it.
Showing Color
Historical flags are increasingly used for political purposes.
Wirmer flag (Germany)
Designed by Josef Wirmer, convicted and executed in
1944 for involvement in a plot to assassinate Adolf Hitler,
this flag is regularly on display at far-right protests.
Saltire, Scotland (U.K.)
Has been Scotland's official flag for more than 600 years.
Its use peaked in the 2014 referendum, when Scots voted
to stay in the U.K., and in recent calls for independence.
Estelada, Catalonia (Spain)
The red and blue ‘estelada’ flags are flown by Catalan
separatists. The official regional flag of Catalonia has the
same stripes, but lacks the star and triangle.
Confederate battle flag (United States)
The battle flag of the Army of Northern Virginia in 1861
was revived in the 1940s to show resistance to civil rights
and more recently by white supremacists.
THE WALL STREET JOURNAL.
STEFANO MONTESI/CORBIS/GETTY IMAGES
Fringe Wave Flies
Historical Flags
Luigi Di Maio, premier candidate of the 5 Star Movement, in Rome. The party could emerge as Italy’s largest in March elections.
Europe Upstarts Fuel State Divides
BY DEBORAH BALL
AND GIOVANNI LEGORANO
ROME—When the votes are
counted in Italy’s election in
March, the winner is likely to
be the same that emerged
from a number of 2017 ballots
in Europe: No one.
From Germany to the Netherlands, voters have abandoned mainstream parties and
thrown their support to upstart groups, making for a political landscape so fragmented
that it becomes difficult to
create new governments.
That is leaving many European countries with an unpalatable choice: Assemble minority governments that will
struggle to make bold policy
decisions, or form cross-party
coalitions of mainstream
groups that feed resentment
toward those parties.
“The Italian vote will go in
the direction of the fragmentation we’ve seen in Spain,
Germany and the Netherlands,” former Italian Prime
Minister Enrico Letta said. “It
will make the European landscape even more difficult.”
Italy’s political landscape
has always been highly fragmented, characterized by
small parties and splinter
groups that wield outsize influence in coalition making.
The result: Weak, patchwork coalitions that have typically had short lives. A decade
ago, a government under
Prime Minister Romano Prodi
included nine parties. In order
to accommodate all of the
groups’ demands, the government had more than 100 ministers and undersecretaries. It
lasted less than two years.
Italy’s departing legislature
has lived up to that tradition.
At its inauguration in 2013, it
counted 15 parties. It is ending
with 23, including five singleperson parties.
The new electoral law that
governs the March ballot favors groups that run as coalitions, thus encouraging the
creation of myriad new splinter groups.
Other countries are looking
more like Italy, as upstart parties steal voters away from
legacy groups. The result is a
wave of minority governments.
If voters feel that establishment parties have banded together in a grand coalition
largely to keep upstart groups
or antiestablishment movements out of power, that could
further undermine legacy par-
Italy’s departing
legislature is ending
with 23 parties, up
from 15 in 2013.
ties’ credibility in Italy.
According to current polls,
the antiestablishment 5 Star
Movement could emerge as the
largest single party with just
short of 30% of votes. As a result, many lawmakers and party
leaders expect March’s election
to produce a hung Parliament.
Italian President Sergio
Mattarella may ask the group
that has received the biggest
number of votes to attempt to
form a minority government.
Or he could ask the biggest
parties to form a grand crossparty coalition. Either scenario bodes ill for the strong
government Italy needs to fix
its sclerotic economy.
The 5 Star Movement,
which refuses to participate in
coalitions, has warned against
a grand coalition by legacy
parties.
“I would abolish words such
as alliances and coalitions,”
said Luigi Di Maio, the group’s
candidate for premier recently.
Rather than form a grand coalition, “the alternative is to
vote again,” he said.
With a grand coalition, “the
perception would be very ugly.
When they inevitably do things
you disapprove of, where do
you go?” said Constantine Fraser, a political analyst with TS
Lombard. “If the mainstream
parties are partners in the
same government, opposition
will go to the populists.”
FROM PAGE ONE
TRADE
Continued from Page One
looked forward to “continuing
to meet strong consumer demand for our premium washing machines.”
At the higher import rates,
as much as six months’ worth
of surplus washer inventory
could arrive in the U.S. before
any tariffs go into effect,
Longbow Research analyst David MacGregor said.
It wasn’t clear how the import surge would affect retail
prices of washing machines.
Analysts predict tariffs on
overseas manufacturers’ washers would eventually get
passed on to consumers, but
Freedonia Group analyst Kyle
Peters said additional imports
before new trade costs could
postpone any price increases.
U.S. import volumes for solar panels and related products also more than doubled,
to the equivalent of 12,379
shipping containers in November, compared with the same
month in 2016, Panjiva trade
data show.
U.S. trade regulators in September agreed with Suniva
and SolarWorld Americas Inc.,
two solar-panel makers with
U.S. factories, that the domestic industry had been harmed
by imports and later recommended tariffs.
Trade data offer a limited
window into companies’ export decisions, which can be
influenced by seasonality, demand and trade. But Panjiva
trade analyst Christopher Rogers said manufacturers expecting new trade barriers often
boost shipments and “there
hasn’t been anything put in
place saying you can’t do
this.”
Their attitude, he said, is:
“Let’s get while the getting is
good.”
Opponents of new tariffs
and other trade barriers argue
they distort markets and are
harmful to consumers, while
many U.S.-based companies
and workers say they protect
domestic industries and jobs.
Companies that back additional trade barriers say the
rise of imports could undercut
new protections they claim
they need to fend off harmful
foreign competition.
Mr. Trump has until early
2018 deadlines to make decisions on potential trade barriers in the cases involving
washers and solar panels as
well as two separate ones involving steel and aluminum.
After receiving recommendations from trade regulators,
the president has wide latitude
to decide whether to impose
restrictions and what type.
Whirlpool, the Michiganbased appliance company, and
solar-panel makers with U.S.
Analysts predict
tariffs on washers will
eventually get passed
on to consumers.
factories are seeking protection under a 1970s-era provision known as the safeguard
law, claiming their businesses
have suffered serious injury
from imports, not from unfair
trade. The U.S. hasn’t imposed
tariffs under the law since
2002.
Members of the U.S. International Trade Commission in
November issued recommendations to the Trump administration that include tariffs of
up to 50% on imported washers exceeding a quota of 1.2
million units annually. The U.S.
imported 10.3 million washing
machines of all types in the 12
months ending Oct. 31, Panjiva
trade data show.
The office of U.S. Trade
Representative Robert Lighthizer held a hearing on Whirlpool’s case Wednesday and a
decision by Mr. Trump is expected by Feb. 2. Decisions in
the other trade cases are expected early this year.
Solar-panel makers are
seeking their own safeguard
protection. Tim Brightbill, an
attorney for SolarWorld Americas, said the import increase
highlighted the need for broad
protections that foreign companies couldn’t circumvent.
“When the president proclaims relief, it needs to be as
comprehensive as possible,”
Mr. Brightbill said.
The Solar Energy Industries
Association, whose members
include American buyers of
solar panels, has opposed the
protection sought by SolarWorld and its ally Suniva,
which has sought bankruptcy
protection amid a glut of lowcost imported panels. It argues the U.S. energy industry
could suffer if tariffs push up
prices on solar panels.
The solar panel makers
“continue to build their case
on the premise that they are
entitled to a U.S. government
bailout because of their abject
and numerous failures as manufacturers,” an association
spokesman said.
Surging Shipments
is hard to come by these days.
Investors are seeking direction in today’s
uncertain world. How long will the U.S. bull
market run? What’s keeping inflation so low?
With risk rising, where are the potential
investment opportunities? And what does
this all mean for your portfolio? Wilmington
Trust provides insight and guidance for
investors seeking to sidestep hazards, navigate
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and grow their assets.
DOWNLOAD
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For a deeper understanding of the markets
and the economic trends likely to unfold in
2018, download our Capital Markets Forecast,
Global Positioning Systems: Recalculating
in Light of Detours, Bumps, and Blind Spots,
at wilmingtontrust.com/cmf.
Imports of washing machines and solar panels have increased
at U.S. ports ahead of Trump administration decisions on new
trade protections.
Total imports
Solar panels†
Large residential washers
15 thousand TEUs*
Sept. 22
The U.S. International Trade Commission found
solar-panel imports injure domestic industry.
12
WEALTH PLANNING | TRUST AND ESTATE SERVICES | INVESTMENT MANAGEMENT | PRIVATE BANKING*
9
6
3
0
2015
’16
’17
Oct. 5
ITC determines imports of large residential washers
harm U.S. appliance makers.
*Twenty-foot equivalent unit (shipping containers)
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A8 | Thursday, January 4, 2018
THE WALL STREET JOURNAL.
* ***
IN DEPTH
CHINA
all U.S. retail locations.
Just 19% of iPhone users
have tried Apple Pay at least
once, according to an estimate
by Loup Ventures, a venturecapital firm. Loup said about
35% of all new iPhones sold in
2017 have activated Apple Pay.
Apple said in November that
active users of the service
more than doubled, and annual
transactions are up threefold.
In some parts of the world,
changes that resemble China’s
are taking place. In Scandinavia, Nordic and Dutch banks
have cut total branch levels by
about 50% from peak levels,
and Sweden hasn’t had checks
since the late 1980s, according
to Citi Research, part of Citigroup Inc.
Continued from Page One
timate, such payments in China
totaled $9 trillion, according to
iResearch Consulting Group, a
Chinese firm.
For Alibaba and Tencent, the
payoff isn’t just the transaction
fees they make from merchants, typically 0.6%. It’s also
the consumer data collected,
which can transform their apps
into marketing platforms for an
expanding array of services,
from bike sharing to travel.
Some of the repercussions
of increasing mobile payments
are just coming into view. The
payments haven’t been required to go through the central bank’s clearing system,
making it harder for China’s
monetary authorities to follow
capital flows and watch for
money laundering and fraud.
The People’s Bank of China has
ordered a new payment-clearing platform that will require
nonbank financial firms to give
it a clearer view of mobile payments by the summer of 2018.
Consumers also are being
offered more pitches for loans,
investments and other financial
products via smartphone.
Short-term consumer credit in
China soared 160% in the first
eight months of 2017 from a
year earlier, according to the
central bank. Some analysts
think the growing ease of borrowing is part of the reason.
Chinese, meanwhile, are
making less use of old-fashioned cash, as in coins and
folding money. They spent
about 66 trillion yuan (nearly
$10 trillion) that way in 2016,
down about 10% in two years,
according to a central-bank
payments report.
VCG/GETTY IMAGES
European partners
A worker in China scans a driver’s phone to charge the highway toll by way of Alipay, a mobile-payment platform from Alibaba.
Alipay as an escrow service. It
would hold payments until
shoppers received their goods.
The service caught on
among buyers who didn’t always trust vendors to deliver
as promised. Alipay evolved
into an online and mobile-payment service and passed PayPal
as the largest mobile-payment
platform in 2013.
That year, Tencent linked a
mobile-payment system to its
popular WeChat instant-messaging app. With Alipay already
in place, the challenge for Tencent was getting people to link
bank accounts to its service.
It devised a strategy based
on the Lunar New Year, when
Chinese people give red envelopes of cash. Tencent encouraged WeChat users to send digital red packets to friends for
the 2014 Lunar New Year, letting them input a sum of
money and send it to friends,
who would divide the loot.
Tencent set things up so
those who opened their virtual
envelopes first got a bigger
share. Over a 24-hour period,
16 million red packets were
sent, and suddenly WeChat Pay
was in the mobile-payments
game. It now has about 40% of
China’s mobile-payment market, versus 54% for Alipay, according to iResearch.
They work in similar ways.
People link their bank accounts
to the app, then pay for things
by scanning a merchant’s QR
code or having the merchant
scan theirs. People also can
transfer money by tapping on
an icon in WeChat or Alipay.
At a night market in Taiwan
recently, Manni Cheng, a textile
saleswoman from Shanghai,
paid cash for grilled prawns
but then noticed the vendor ac-
Alibaba went first
The path to mobile payment
was blazed by Alibaba, which
hosts online shopping bazaars
where merchants sell goods to
consumers. More than a dozen
years ago, Alibaba, taking a
page from the U.S. company
now called PayPal Holdings
Inc., started a system named
Tackling a Problem
A less-developed traditional
banking system helped spur
mobile payments in China.
223
Commercial bank
branches*
ATMs*
81.5
8.8
China
68.3
23.9
Europe
27.8
N. America
*Per 100,000 adults in 2016
Source: World Bank
THE WALL STREET JOURNAL.
cepted Alipay. She asked for
her cash back and paid with
her phone.
Ms. Cheng said she likes Alipay because it lets her track
her spending and avoid carrying a lot of cash. Money in her
Alipay balance is transferred to
the app’s money-market fund.
“It’s a payment tool with
wealth-management functions,”
Ms. Cheng said. The seamless
use of phones as wallets rarely
fails to amaze foreigners traveling in China.
Tencent has created a platform for businesses so customers can “follow” them for news
and discounts. Customers who
follow Gap Inc., for instance,
might be alerted to promotions
and discounts when they return to the store, potentially
generating more sales for Gap
and revenue for WeChat.
Targeting ads
Alibaba can monitor the
shows people watch on its
Youku Tudou video-streaming
site and push ads targeted to
them, generating ad commissions and product sales for Alibaba, plus a clearer picture of
consumer behavior. While using the data within their ecosystems, both internet giants
say they don’t sell it to others.
Conditions in China made it
ripe for this innovation. Credit
cards never caught on in a big
way. Discretionary spending
wasn’t an option for most people until recent years, and
there has long been a cultural
aversion to debt in China. On
top of that, the government
made it tough for Visa Inc. and
Mastercard Inc. to set up shop.
The rise of tech companies
as financial powers has dealt a
Paying on the Go
The number of mobile payment
users in China has grown
rapidly…
…and mobile payments more
than quadrupled from 2015 to
2016, far faster than the U.S.
500 million users
$10 trillion
400
8
300
6
200
4
100
2
U.S.
0
0
2012
’13
’14
’15
’16
2012
’13
’14
’15
’16
Sources: China Internet Network Information Center (users);
THE WALL STREET JOURNAL.
Forrester Research; iResearch
blow to traditional banks.
China’s state-owned banks lost
nearly $23 billion in fees in
2015 they might have collected
from card fees, according to a
November 2016 report from EY
(formerly Ernst & Young) and
Singapore’s DBS Bank. The report projected the annual fee
loss could widen to $60 billion
by 2020.
The larger problem for
banks might be that Alibaba
and Tencent often know more
about their customers than
they do. If a Beijing car dealer
uses a bank debit card for a
business trip to Shanghai, the
bank knows what airline he or
she flew, as well as the hotel
and restaurants patronized.
“But if the ‘customer interface’
is happening elsewhere, the
bank has zero visibility over
transactions,” said James Lloyd,
Asia-Pacific FinTech Leader at
EY. “That’s not a good situation
to find yourself in.”
SMOKE
U.S.
payment-processing
firms have been ramping up
their own digital-wallet efforts.
Visa and Mastercard both have
mobile apps that allow users to
pay via near-field communication and are incorporating biometrics into their offerings.
They also work with Apple Pay
and Samsung Pay.
PayPal, which allowed people to beam money to each
other via Palm Pilots in the late
1990s, has formed partnerships
with more than 20 other companies to extend its mobile
payments, including Alphabet
Inc.’s Google and Chinese
search giant Baidu Inc. About
34% of PayPal’s payment volume is mobile, said Bill Ready,
chief operating officer.
Smartphones are vastly
more common than Palm Pilots
ever were, yet Apple Inc. has
struggled to get consumers to
use its Apple Pay service, now
accepted at more than 50% of
What Is Slow Smoking?
Think a ‘sport’ in which competitors aim to keep their cigars
lit for as long as possible. Slow smokers adhere to a host of
rules and employ various strategies to gain an edge.
One cigar
Contestants are passed the same size cigar—about five inches long.
Contestants have one minute to cut the cigars any way they like.
SIEMOND CHAN/THE WALL STREET JOURNAL
Continued from Page One
The trouble with cigars is
that they go out. Now dedicated
cigar fans are trying to master
“slow smoking,” seeing just how
long they can keep the flame
alive. That takes practice and
creativity. It also yields prizes,
handed out at special events
from Chicago to Croatia.
In fact, it is in the latter locale where slow smoking largely
evolved, courtesy of Marko
Bilić, a cigar enthusiast who
calls Croatia home. As Mr. Bilić
explains, he was out one night
almost a decade ago with a
friend at a bar. The two planned
on enjoying a smoke, only to
discover they were down to
their last few matches—meaning there was little to no opportunity for relighting.
The idea was born to keep
their cigars lighted for as long
as possible under those challenging circumstances. “We
said, ‘Man, it’s like a competition,’ ” recalled Mr. Bilić.
Mr. Bilić turned it into just
that, hosting what has become
the world championship in
Split—Croatia’s second-largest
city—where he owns a cigar
shop. He helps support the
slow-smoking community and
the events that often serve as
qualifiers for his tournament,
where more than 100 contestants from 25-plus countries
come to compete.
In addition, Mr. Bilić establishes the rules that guide the
sport (and yes, he very much
considers it that). All cigars
used in events must be the
same size—around 5 inches.
Competitors must also refrain
from talking during the first
five minutes to maintain a
China
Tencent and Ant Financial
Services, the Alibaba affiliate
that operates Alipay, are forming partnerships with payment
processing companies across
Europe and investing in mobile
payment firms in India, Thailand and other countries.
Ant Financial also sought to
buy U.S. money-transfer firm
MoneyGram International Inc.,
whose 200-country network
enables users to send cash
through banks, stores and kiosks. But the companies said
Tuesday that a U.S. national-security panel refused to approve
the $1.2 billion deal.
WeChat Pay and Alipay are
gaining attention in U.S. tourist
centers after striking deals
with hotels and resorts. A
group of Chinese tourists recently dined at the Bacchanal
Buffet at Caesars Palace in Las
Vegas, where the menu includes T-bone Australian lamb,
chilled crab legs and handmade
dim sum. They settled their bill
with a smartphone.
“One couple stopped to
watch the WeChat Pay transaction and asked for an explanation,” said Bruce Bommarito, a
Caesars executive. “They were
surprised…and wanted to know
if this payment method was
available to Americans as well.”
Americans can sign up for
WeChat but can’t link it to U.S.
bank accounts. Alipay isn’t
available for Americans as of
now.
Tencent and Alibaba say
they have no plans to push
their payment platforms to U.S.
consumers. Many Americans
don’t see the need for mobile
payments, since their plastic
cards and cash are welcomed
and some merchants still accept checks.
“Any new way of paying has
to prove itself to be incrementally better than any other options you have,” said James
Wester of research firm IDC Financial Insights. In the U.S.,
“plastic is convenient, widely
accepted and understood by
the customer.”
—Junya Qian and Liyan Qi
contributed to this article.
Two matches
One minute to light the cigar, no reigniting after.
Contestants are not allowed to put their cigars
down, or blow on their cigars.
40 minutes
No ashing in the first 40 minutes of the
competition—or else penalties are applied.
Slow-smoker Julian Riley lights his cigar as a contest begins. The record now tops three hours.
Source: Darren Cioffi
proper air of decorum.
In any case, die-hard slow
smokers say that to talk while
smoking is to risk losing focus.
The art of the slow burn, they
explain, is about minding your
cigar every second, giving it
just enough of attention—think
“gingerly” puffing—to ensure it
stays on the right side of being
lighted. “Dancing on the edge of
not smoking” is how one competitor described it.
Patricia Benden, a cigar retailer who lives in Germany, attends slow-smoke events
throughout the world. Her personal best is an approximately
2½ hour smoke time. Her success is all based on the quick,
short puff. “Usually when I
smoke, I take longer puffs, but
during competition, I try to take
short puffs so the cigar doesn’t
get too hot,” she says.
The best smokers have
pushed the burn past two
hours. In 2017, Tomasz
Żołądkiewicz, a cigar fan in Po-
“You have to learn what’s going
to work for you.”
He is careful about trying to
find the right cigar, but says it
can be unpredictable. “A cigar is
a handmade product,” he says,
pointing to the variation from
one to the next. At one event,
he says, his cigar had a “weird
burn” which affected his ability
to keep it under control and
rack up minutes. “It was burning in a spiral pattern.”
Felix Paredes, owner of Harlem Cigar Room, a New York
emporium that often stages
slow-smoking events, holds his
cigar such that it can almost
pick up the moisture from his
palm. The idea is that the
dampness can stifle the burn,
but Mr. Paredes knows he is in
jeopardy of violating the sanction against wetting the cigar.
“It’s cheating, but it’s not cheating,” he said of his practice.
In a recent slow-smoking attempt, Mr. Paredes kept his cigar lighted for a paltry 14 min-
land, crossed the three-hour
mark—3 hours and 26 seconds,
to be exact—an achievement
many in the slow-smoking community speak about with the
same awe that others have reserved for the great athletic
benchmarks of the past century,
like running a mile in under
four minutes.
“A few years ago, we thought
three hours was unimaginable,”
said Darren Cioffi, a veteran
slow smoker and owner of the
Principle Cigars brand. His top
time is 2 hours and 50 minutes.
He advocates a “three stage”
approach to puffing, starting
with “slow, delicate puffs” to
get the cigar gently going. In
the second stage, the “puffs are
a little more intense” to keep it
on the right side of burning.
And in the final stage, the
“puffs are more shallow”—just
to keep it barely going.
He also suggests “ashing”—
tapping the ash off your cigar—
as little as possible. The reason?
“When you ash, the cigar is at a
vulnerable state. You’re exposed
to elements.”
Some slow smokers emphasize the lighting aspect. If they
get just an edge of the cigar going—rather than the entire
“foot” or end—they believe they
can add several minutes of burn
time. The risk, however, is that
if you don’t light enough of the
cigar, it can easily flame out,
which means you’re playing
with fire, literally.
To make sure he doesn’t puff
too aggressively, Rob Potter, a
software specialist and cigar fan
who lives in Hendersonville,
Tenn., always smokes two cigars before competing. “You’re
not going to want to smoke
your third cigar fast,” he explains.
Chase Lyle, who owns Primings Cigar Lounge and Bar in
Nashville, Tenn., has kept a cigar going for roughly 2 hours
and 45 minutes. “Everybody has
a different strategy,” he says.
THE WALL STREET JOURNAL.
utes and 40 seconds. He blamed
it on losing patience and not
being in sync with his stogie,
comparing his situation to a
golfer who rushes through 18
holes. “It’s allowing you to pace
yourself,” he said.
Achieving greatness means
putting in lots of practice,
which, in turn, means reeking of
cigars all the time, slow smokers concede. It can also mean
subjecting yourself to a fair
share of ridicule. “I’m sure
there are people who get off on
that, but I’m not one of them,”
said John Rosselli, a former cigar retailer in New York, planning to open a store soon. He
said the only way he would host
a slow-smoking event is if he
was “compelled by a court order.”
After claiming his U.S. championship, Mr. Hroncich—who
describes himself as a “casual”
smoker—said he has no plans to
defend it. “I made my mark and
I’m done,” he said.
.
THE WALL STREET JOURNAL.
LIFE&ARTS
Thursday, January 4, 2018 | A9
TSA plans to expand testing of an ID verification machine.
THE MIDDLE SEAT | By Scott McCartney
What You Need to
Know to Travel in 2018
HOW’S THIS for an airline-industry slogan for 2018: More rules,
less room.
Travelers will run into a lot
more rules-laden, bare-bones basic
economy fares—beware when you
shop. The rules may change on IDs
at TSA checkpoints, too.
This year will see more airplanes—new and old—squeezing in
more seats. But U.S. travelers will
also start seeing more opportunities to buy more space without
spending many thousands of dollars on international flights.
Here’s a rundown of significant
changes travelers can expect in
2018:
More Seats, Less Room
Just when you thought airlines
couldn’t squeeze more seats onto
airplanes, more planes are coming
with even more densely packed
seating.
American will be taking delivery of more Boeing 737-8 MAX
jets this year with coach rows set
at only 30 inches, an inch or two
smaller than older 737s of the
same size. The Max has the same
cabin size as the Boeing 737-800.
American used to fly 150 seats on
the 737-800, then upped it to 160
with “slim line” seats. The Max
has 172 seats in American’s configuration. (Southwest will fly the
Max with 175 seats—but no firstclass cabin or extra-legroom rows.
So Southwest’s seats have more
room on average.)
The slim-seat retrofit squeeze,
which began more than five years
ago, isn’t the only way airlines are
shoehorning seats into planes.
Smaller restrooms and galleys
clear space for more seats, and
some wide-body jets are getting
more seats in each row.
More of United’s 777s will get
10 seats across each coach row, up
from nine. That’s a change that
American and several foreign airlines have already made. (Delta remains at nine abreast.) Other
United planes, like some 757s, that
haven’t yet gotten the slim-seat
squeeze will be headed into the
hangar in 2018 for what airlines
fondly call “densification.”
TSA ID Changes
A 2005 law requires states to update their identity verification procedures when issuing IDs like
driver’s licenses. Only 27 plus the
District of Columbia are compliant
so far, and a deadline looms. The
Transportation Security Administration is threatening to stop accepting driver’s licenses from non-
compliant states starting in
October. In theory, you’d need a
passport at TSA checkpoints or go
through secondary screening.
Twenty states have an extension
to October, but three—New York,
Michigan and Louisiana—don’t.
Technically TSA could stop accepting state-issued IDs from those
states on Jan. 22.
Extensions are likely. It seems
doubtful that Homeland Security
would bollix up TSA checkpoints
with sweeping new ID requirements. But you might want to have
your passport handy by October if
you live in a noncompliant state,
just in case.
TSA also says it likely will expand a pilot program where travelers don’t need a boarding pass to
go through security—only an ID.
TSA has a machine that it says
better verifies driver’s licenses and
passports and checks them against
both flight lists and status lists,
like PreCheck.
The machines, called Credential
Authentication Technology, have
been in place since summer at PreCheck lanes in six airports: Washington’s Reagan and Dulles, Chicago’s O’Hare, Atlanta, Boston and
Austin, Texas.
And TSA will continue expanding stricter rules for carry-on baggage. Already at more than 200
airports, TSA makes people remove all personal electronic devices larger than a cellphone from
a carry-on and place them in a bin.
(PreCheck fliers still avoid this.)
The idea is to declutter bags so
conventional X-ray machines get a
better view of what’s what. In
2018, all TSA airports will be implementing the checkpoint procedure, the agency says.
Room for Sale
American and Delta are finally
catching up to their international
rivals on premium economy.
(United has yet to announce a premium economy plan.)
American says it will complete
its rollout of premium economy on
wide-body planes by the end of
the year, putting it ahead of U.S.
competitors. American plans to
have 102 aircraft equipped with
premium economy.
Delta says five A350s are in
service with premium economy
and six more will be delivered in
2018. In addition, Delta says ret-
rofits on its 777-200 aircraft will
start flying with premium economy in the summer.
Think of premium economy as
what business class used to be before lie-flat beds. It’s actually
fairly close to domestic first-class
seats, at least the shrunken, slimline variety. You get ample legroom, a bit wider seat, your own
cabin (key factor: bathroom) and
often upgraded meal service over
coach. It’s different from extra-legroom rows on U.S. airlines—a separate class of service.
A premium-economy ticket can
cost $700 to $2,000 more than a
regular economy fare, but still significantly less than a $7,000 business-class seat. It’s a great option
for budget-minded business travelers or leisure travelers willing to
pay for adequate space to escape
the coach squeeze on long flights.
Mergers That Matter
Alaska Airlines says it will merge
Virgin America’s operation into its
own in 2018. The Virgin America
name will eventually disappear.
The combined company moved to
one frequent-flier program on Jan.
1—Alaska’s Mileage Plan. A spokeswoman says the merger should be
80% complete by June.
Another closely watched merger
for frequent travelers: Marriott’s
acquisition of Starwood. The two
companies have different loyalty
programs, and customers are anxious to see how the two fit together. Marriott has said to expect
small changes in 2018. The move
to a single loyalty program will
likely happen in 2019.
Smart Bag Setback
Alaska will make
major moves to
fold Virgin America
into the Alaska
brand this year.
Smart bags—luggage with GPS
tracking devices and other electronics that help you keep track of your
bag plus power ports to charge
phones and tablets on the fly—have
been popular with many road warriors. But they’re getting grounded
by many airlines starting Jan. 15.
The FAA has deemed lithium
batteries a potential fire hazard.
So American, Delta, Southwest,
Alaska and others have decided
not to accept smart bags as
checked luggage unless the batteries can be removed. (Once you remove the power, you can’t track
your smart bag, diminishing its
utility.) Carry-on bags can fly only
if the lithium is removable; if the
bag has to be checked, the battery
must come out. On some of the
bags, including Bluesmart, the batteries aren’t removable.
Makers of smart bags with nonremovable batteries say they are
seeking waivers—they believe
their bags are safe.
CLOCKWISE FROM TOP LEFT: ILLUSTRATION BY ROB WILSON; STEPHEN VOSS FOR THE WALL STREET JOURNAL; TED S. WARREN/ASSOCIATED PRESS
BOOKS
MAPPING THE POWER OF THE PRINTED WORD
DYLAN THOMAS FOR THE WALL STREET JOURNAL
BY JENNIFER CLARK
Cristina Dondi, above in her office at Oxford, is leading a project to catalog the surviving books printed from 1450 to 1500.
SINCE 2010, University of Oxford
researcher Cristina Dondi and her
team of antique-book experts have
carried out a vast and unusual
treasure hunt: tracking down and
cataloging the half-million books
printed from 1450 to 1500 that
still survive and are now scattered
across 4,000 libraries in Europe
and the U.S.
They are mapping the development of the book trade as Europe
moved from the Middle Ages to
early modern society to see what
it reveals about the spread of
knowledge and the revolutionary
impact of the printing press on society.
The invention of the movable
type printing press around 1440 in
Germany caused a publishing explosion. In the short span of decades, printing shops opened
across Europe, sparking a democratization of knowledge unequaled
until the Industrial Revolution and
the advent of the internet.
Few records of this early book
trade exist. But these sturdy
books, printed on cloth paper, have
outlived most other artifacts of
their era. They each reveal a story
through decoration, stamps, annotations, bindings, prices and other
clues, says Dr. Dondi. The more
marked up they are, the more they
say.
Dr. Dondi and her sleuths decipher centuries-old scribblings in
Latin and Greek, ranging from
dedications to medical prescriptions, to ascertain a book’s former
ownership. They enter the information in an electronic database
that allows users to track each
book’s journey from printing to
the present day. The result is a
sort of huge electronic map that
captures the formation and dispersal of library collections at the
dawn of the print era.
Dr. Dondi and other scholars say
the database shows that printed
books were distributed much more
widely in the decades immediately
following the invention of the
Please see BOOKS page A12
.
A10 | Thursday, January 4, 2018
THE WALL STREET JOURNAL.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | A11
.
THE WALL STREET JOURNAL.
A12 | Thursday, January 4, 2018
LIFE & ARTS
SIGHTINGS | By Terry Teachout
Seeing a Legacy Whole
CLOCKWISE FROM LEFT: JACK MITCHELL/GETTY IMAGES; ZUMA PRESS (2)
We can admire the work of artists who have done terrible things, but only if we frankly acknowledge their misdeeds
Clockwise from left: James Levine in
1982; Peter Martins in 2017; Charles
Dutoit in 2017.
time in sorting out the
wider implications of
the Levine scandal.
Just before Christmas
Mark Swed made a
preliminary but surprisingly mild attempt
to do so in a Los Angeles Times “Critic’s
Notebook” essay whose
operative passage read
as follows: “The question is not whether the
bad outweighs the
good…but whether the
bad destroys the good.
Levine has left us with
a lot that matters.” Mr.
Tommasini, writing in the New
York Times, made a similar point
in a similar way when he mentioned that he owns two boxed
sets of Mr. Levine’s opera recordings, and that his personal response to the scandal will be “to
move them out of my living
room.” To be sure, extreme caution is needed in weighing Mr.
Levine’s achievements against his
conduct, not least because the
charges against him remain unproved. But such rhetorical mildness inevitably smacks of tempo-
rizing. Stronger words are needed,
and a historical comparison—one
of the utmost relevance—may help
to fill in the blanks.
The headline of Mr. Swed’s essay refers to “the age-old debate
of separating the art from the artist.” This is the heart of the matter: It is mostly taken for granted
by aesthetes that the creative
achievements of a morally flawed
artist can and should be judged
separately from his offstage conduct. (Two words: Pablo Picasso.)
According to William Faulkner, “If
a writer has to rob his
mother, he will not
hesitate; the ‘Ode on a
Grecian Urn’ is worth
any number of old ladies.”
Laymen have always
been understandably
uncomfortable with
this belief, for the very
good reason that it encourages us to treat
great artists as privileged creatures inhabiting a moral realm
above and beyond that
of the rest of us. For
me, Faulkner’s oftquoted apothegm is at the very
least arguable—but with one essential caveat: No matter how
beautiful or profound the results
may be, the artist who robs his
mother should do time for it. He
must be subject to the inexorable
operation of the moral law.
Consider the case of Herbert
von Karajan. He was one of the
greatest orchestral conductors of
the 20th century. He was also in
his youth a member of the Nazi
party, which he joined in 1933 to
further his career. How should
Mr. Teachout, the Journal’s drama
critic, writes “Sightings,” a column
about the arts, every other week.
Write to him at
tteachout@wsj.com.
DYLAN THOMAS FOR THE WALL STREET JOURNAL
FIRST JAMES LEVINE, then
Charles Dutoit and Peter Martins:
The world of high art continues to
be rocked by accusations of sexual misconduct by major figures,
and no one doubts that more are
on the way. The case of Mr.
Levine, however, remains at the
front of the queue, with two of
his most notable critical admirers,
Alex Ross of the New Yorker and
Anthony Tommasini of the New
York Times, having gone so far as
to apologize for previously defending him as the victim of unfounded gossip.
Now what? Few doubt that Mr.
Levine’s performing career is
over, regardless of whether he is
in legal jeopardy. But what of his
artistic legacy? Will his musical
achievements be forgotten as a
result of his disgrace? Not only
has he recorded extensively for
the past four decades, but audio
and video recordings of his
broadcast performances with the
Met continue to be widely available. Will this continue to be
true—and should it? Or is Mr.
Levine’s work destined to vanish
into the memory hole?
We will, I feel certain, be a long
that affect our feelings about his
work? Karajan took part in the Allied “denazification” process after
World War II, and was authorized
to resume his conducting career.
But when his Nazi past was rediscovered by reporters in the ’50s,
it became a permanent part of his
legacy, prominently mentioned in
his obituaries and recalled whenever he is discussed today.
All this, it seems to me, is just
as it should be. I love many of
Karajan’s recordings and listen to
them often—but I also believe that
his party membership should forevermore be a blood-red stain on
his reputation. He deserves to pay
that price for the opportunism of
his youth.
If any of James Levine’s recordings are good enough to survive
him, I’m fine with that. I don’t
think they should be removed
from circulation, or that his name
should be scrubbed from the
Met’s website. But if it should
eventually be proved that he
abused teenage boys, then that
foul fact, over and above whatever punishment the law may prescribe, should also be remembered to the end of time, and
cited unequivocally whenever his
name is mentioned. Only then will
Mr. Levine, like Karajan before
him, earn the privilege of having
his art judged apart from his personal conduct.
Dr. Dondi and her team, above, decipher scribblings and use decoration, bindings and other clues to ascertain a book’s provenance.
BOOKS
Continued from page A9
printing press than historians have
believed. And the best-sellers
weren’t Bibles or classics like Plato
and Aristotle beloved of Renaissance scholars, but grammar texts
and books to teach people to learn
to read and write.
“We are finally proving the link
between literacy and the print revolution,” Dr. Dondi said in an interview in her office at Oxford’s
Lincoln College. “What we will
demonstrate by the end of this
project is that by 1500 there were
millions of books circulating in Eu-
rope and they were not just used
by the elites,” she said.
This early book trade was made
up of a dizzying variety of secular
texts. Apart from the top-selling
grammar manuals, there were
medical and legal texts, single
sheets on current affairs, almanacs, books on astrology, poetry,
and songs in Europe’s vernacular
languages.
Another interesting fact that
emerges from assembling the pieces
of the early book trade is Italy’s
role as the main publishing center,
book experts say. Johannes Gutenberg in Mainz, Germany, invented
the movable type press and printed
a Bible sometime between 1452 and
1454. But it was Italy where print-
ing turned into a business.
“Venice became Europe’s most
important publishing center because of its bankers, insurers and
transportation,” says Mario Infelise, a professor in the Humanities
Department at Ca’ Foscari University of Venice. “German typographers traveled south and found
fertile ground in Venice, Florence
and Rome because of the economy.”
The spread of cheap printed
books across 15th-century trade
routes is similar to the dot-com era
in several ways, says Dr. Dondi,
who will present the results of her
research at a conference next September in Venice called “The Fifty
Years that Changed Europe.”
Printing suddenly brought together three segments of society
that in the Middle Ages had little
to do with one another: the printer
(technology), a content manager (a
professor or book merchant) and
bankers, she says. The acceleration
of the spread of knowledge due to
a drop in price is a more obvious
parallel to the internet.
Another parallel is censorship,
Dr. Dondi says. The first 70-odd
years of the book trade was an era
of wild experimentation with no
censorship, and few rules until the
Reformation prompted a reaction
from the Catholic Church. With the
internet, governments have moved
more quickly to put rules in place,
she says.
The database now has tens of
thousands of records, and Dr.
Dondi says she is confident that
her team can eventually catalog
the 500,000 or so remaining books
of the millions printed from 1450
to 1500.
For scholars, the database is
an important tool for those
studying the social impact of the
print revolution, according to
Eric White, curator of rare books
at Princeton University Library.
“Years from now it will be the goto place also for people interested in, say, gender studies or
art history, for example,” said Mr.
White. “It’s not just a history of
early books; it’s the history of
people.”
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | A13
CLOCKWISE FROM TOP LEFT: SOCIAL KITCHEN; KRISTEN MENDIOLA; SUSAN MEZZULO; TIM KING; IVORY ON SUNSET; TAVERN62
LIFE & ARTS
Chef Zack Sklar took
avocado toast, left, off
menus at two Michigan
restaurants this fall.
DINING
On—and Off—Menus in 2018
In the age of Instagram, top chefs cycle through trendy offerings more quickly in efforts to stay fresh
BY ALINA DIZIK
AVOCADO TOAST IS SO 2017.
Some of the trendiest foods
to appear on restaurant menus
last year will be much harder
to find in 2018. Many top chefs
will be bidding farewell to tuna
tartare, sirloin steak and foie
gras, as well. Even kale is getting kicked out the door in
some spots.
Among rising stars that diners will likely be seeing more
often in 2018: seasoned raw
fish known as crudo, duck
meat, carrots and squash.
In the age of Instagram, top
chefs are cycling through fashionable dishes more quickly,
food industry experts say. As
photos of trendy dishes and ingredients go viral and are
shared and copied, they move
faster down the restaurant circuit to fast-food menus or cheaper
casual establishments. The pressure is on chefs to come up with
fresher, newer offerings.
On average, it takes six to eight
years for a dish to move from
fine-dining menus to a fast-food
menu, according to a study by
Datassential, a Chicago-based
market research firm. That compares to about 12 years a decade
ago.
This year, Brian Malarkey, a
partner at Hakkasan Group and
chef at nine restaurants, including
Searsucker in Del Mar, Calif., finally hopes to remove kale salad
from the menu—a process that has
taken more than a year. In 2017, he
added lettuce to the salad to help
take attention away from the kale.
What was kale salad in 2017 is
now “in the transitional period”
and billed as a “kale and romaine
Caesar,” where the leafy green is
no longer the main ingredient, he
says. “When [fast food restaurants] started serving kale salad,
you know you’ve run your course.”
Another recently retired trend:
Chef David Burke, right
top, now serves an
entree starring roast
duck with foie gras pie
as a side at Tavern62 in
New York; chef Brian
Malarkey is working to
take kale salad off the
menu in Del Mar, Calif.
microgreens, plants
harvested young that
have “zero flavor
value,” Mr. Malarkey
says.
When pulling the plug on a popular dish, training servers to talk
up replacements is key, says Detroit-based chef Zack Sklar, owner
of two Social Kitchen and Bar restaurants in Michigan and four
other casual restaurants around the
U.S. This fall, Mr. Sklar took the
best-selling avocado toast off
menus at Social’s locations, as the
dish is available so widely elsewhere. In its place he’s offering
toast with more seasonal toppings,
such as squash or mushrooms. So
far, the new dishes have been slow
to take off. “You have to train your
team to sell it, and train your patrons to enjoy something different,” he says.
Chefs famous for innovation at
prestigious restaurants are credited with setting the agenda for
what’s the most fashionable food
and flavor. This year, among
trends at top restaurants are
Asian-inspired flavors including
the Japanese furikake seasoning
and karashi mustard; a Korean
noodle stir-fry called japchae; and
South Asian-style fritters known
as pakora, according to research
from Datassential.
While leaving dated items on a
menu can damage a restaurant’s
reputation, some restaurateurs are
too quick to retire beloved dishes
and unnecessarily impact sales. “It
can be a mistake to take it off too
early and move on too quickly—
people like to be comforted,” says
Mike Kostyo, who oversees
Datassential’s food-trends reports.
Fruits and vegetables have their
own fashion cycle. At Baldor Specialty Foods, a Bronx, N.Y.-based
restaurant supplier, senior marketing director Ben Walker has noticed a change in the produce that
chefs are buying. Celery, melon
and cabbage are less popular,
while carrots, peas and broccoli
orders have grown by about 10% in
the past year. “You are seeing basic vegetables trending,” Mr.
Walker says. Duck is also on the
rise, he notes.
Pricey ingredients can be even
more pressing to retire once they
stop being top sellers, because inventories are more costly. This
winter, chef RJ Cooper at Henley
in Nashville, Tenn.,
has done away with
the pricey yet ubiquitous rib-eye steak and
tuna tartare. “In the
middle of Tennessee,
[it] just doesn’t seem
right,” he says. Instead he’s offering
cured fluke and
smoked beef belly,
which are harder to
find on nearby menus.
“There’s got to be a
novelty with what
we’re doing—anybody
can put fish, chicken
and beef on a menu.”
Not all ingredients
make a complete exit.
In the past few
years, David Burke, executive chef
at Tavern62 in New York, noticed
that diners were no longer ordering
foie gras appetizers that had been
popular since the ’90s. He’s taken
the 3-ounce portions of fatty liver
off the menu, but instead serves a
more modest foie gras pie as a garnish to a roasted duck breast entree. “It was once the most expensive appetizer on the menu…[but]
they beat that song to death.” Another offering he has removed for
2018: veal entrees, because many
diners no longer want a sauce on
the meat, which is often the way
veal is served.
Dinner entrees tend to feel
dated more quickly. At three Denver-area ViewHouse restaurants,
executive chef Jose Guerrero has
swapped a crab-cake appetizer for
crudo, thinly sliced raw fish. A
crab-cake benedict is still on the
menu for brunch but will be
swapped out early this year, he
says. He tries to make room for
newer offerings without alienating
diners who seek comfort-style
dishes early in the day.
Fully retiring an item is bittersweet: “It’s almost like you’re
breaking up with these ingredients, but you hope they find a
home somewhere else,” Mr. Guerrero says.
Goodbye Kale, Hello Crudo
What’s Out
What’s In
Avocado toast This popular
2017 combo has peaked: Detroit-based chef Zack Sklar, for
instance, is pushing diners to
try toast topped with seasonal
squash or mushrooms instead.
Brisket Smoked meats including cuts such as brisket
are gaining popularity on
menus across the country,
according to research from
Datassential.
Tuna tartare Executive
chef RJ Cooper at Henley in
Nashville, Tenn., has done
away with pricey tuna tartare
in favor of a more unusual
cured fluke dish.
Crudo More restaurants
are introducing thinly sliced
raw fish known as crudo.
Denver-based chef Jose
Guerrero, for instance, is
serving the dish in place of a
crab-cake appetizer..
Kale ‘When [fast-food restaurants] started serving kale
salad, you know you’ve run
your course,’ says San Diegobased chef Brian Malarkey,
who is weaning it from his
menu.
Veal David Burke, executive
chef at Tavern62, in New York
has taken veal entrees off the
menu for 2018 as diners move
away from sauced meats.
Pakora At innovative top
restaurants, Asian-inspired
flavors and dishes, including
South Asian-style fritters
called pakora, are catching on.
Duck As some chefs notice a falloff in orders of
hefty foie gras appetizers,
duck meat is gaining traction
on menus, a trend reflected
in rising wholesale orders.
GETTY IMAGES/ISTOCKPHOTO (2)
With the new year comes new pressure on top chefs to dazzle diners’ taste buds—a cycle that is only speeding up in the age of trends pushed by Instagram.
Here are some past favorites that are now fading...and some of the new flavors making their way onto menus.
.
THE WALL STREET JOURNAL.
A14 | Thursday, January 4, 2018
SPORTS
BASKETBALL
THE CURRY GENERATION HITS COLLEGE BASKETBALL
Oklahoma’s freshman point guard Trae Young plays like Stephen Curry because he grew up when Curry was revolutionizing the game
Kevin Durant and Russell Westbrook were curious. The former
Oklahoma City Thunder teammates
had a rare off night at home, and
there was a college game nearby
between Davidson and Oklahoma.
Durant and Westbrook knew they
needed to be there. They had to
see Stephen Curry.
It was November 2008, only a
few months after Davidson’s electric and improbable NCAA tournament run, and anyone who cared
about basketball was mesmerized
by Curry. Among the many people
under Curry’s magical spell was a
10-year-old boy named Trae
Young. He lived near Oklahoma’s
campus, and there was no way he
was going to miss the Davidson
game. He arrived early to watch
Curry shoot in warmups. He was
as captivated by Curry scoring a
career-high 44 points as the NBA
stars in the front row. He can still
recite every detail.
“I remember exactly where I
was sitting,” he said.
Young is familiar with the location because he now plays in that
same arena as Oklahoma’s freshman point guard. And he’s the
most dazzling player in college
basketball himself.
Young leads the country in scoring with 29.6 points per game. He
also leads the country in assists
with 10.7 per game. His other numbers are no less mind-boggling.
There has never been a player in a
major conference who takes, and
makes, as many 3-pointers, and
there has never been a player with
combination of volume and efficiency in the time since volume
and efficiency have existed as metrics in college basketball.
“What he’s doing is statistically
off the charts,” Oklahoma coach
Lon Kruger said.
But Young is also captivating in
a way that statistics can’t explain.
To watch him is to experience the
thrill of having absolutely no idea
what’s going to happen next.
The only college player in the
last two decades who put together
a season anything like Young’s was
Curry. The only NBA player with a
game anything like Young’s is
Curry. It’s only natural to compare
them: Young plays like Curry incarnate.
But he’s not the next Curry. He’s
the first player of the Curry generation.
Young was in his formative
years as Curry was redefining his
favorite sport. He was exactly the
right age to be profoundly influenced by the most transformational player of his lifetime. “He
was changing the game,” Young
said, “and the way I played fit perfectly.”
RICHARD ROWE/ICON SPORTSWIRE/GETTY IMAGES, EZRA SHAW/GETTY IMAGES
BY BEN COHEN
Oklahoma point guard Trae Young, left, was in his formative years around the time Golden State was unleashing Stephen Curry, right, on the NBA.
Curry is more responsible than
anyone for the fundamental shift
in basketball strategy that’s now
apparent at every level of the
sport, and the first wave of kids
who followed his example is about
to invade college basketball and
the NBA. Young is one of those
kids. He barely experienced a basketball world that hadn’t been
turned upside down by Curry. The
conventional wisdom by the time
he was in high school was counterintuitive when he was born.
“Shooting threes,” Young said,
“is not such a bad thing.”
And so he shoots threes. He
shoots threes off the dribble. He
shoots threes from the half-court
logo and from places so far behind
the line that he makes the floor
look miniature. He shoots threes
even when it seems like he can’t.
But he also sucks defenders into
his orbit, and exploits the attention he commands to finish at the
rim or create easy scoring opportunities for his teammates.
Young plays like someone who
grew up studying Curry because
that’s exactly what he did.
“I would record every game,” he
said. “I’d watch before I went to
bed or the next day. I watched how
he played, how the Warriors
moved without the ball and how
Steph got everyone involved and
still created for himself. I loved
watching Steph’s game.”
Steph’s game wasn’t always
Young’s game. When he was in
middle school, so recently that
Curry was already in the NBA,
Young wasn’t a point guard. He
was used as a wing because he
was bigger than his teammates,
and he was stuck in the corner
waiting for shots instead of making them for himself. By eighth
grade, he was tired of waiting. He
became a point guard.
Curry wasn’t the only player he
used as inspiration. Young im-
Trae Young has an
intuitive understanding
of the most effective way
to play basketball.
proved his ball-handling by tapping into the well of basketball
wisdom known as YouTube. He
stole tricks from Steve Nash, Chris
Paul and Tony Parker, and he
speaks fondly of a Kyrie Irving
routine that includes wrapping the
ball in plastic and dribbling inside
a garage with the lights out.
“I really wouldn’t look at highlights or mix tapes,” he said. “I
would look at drills.”
Weather
20s
V
Vancouver
<0
d
t
Edmonton
0s
Calgary
10s
20s
30s
Seattle
P
d
Portland
Eugene
50s
l
Helena
20s
10s
ip
Winnipeg
20s
0s
Ottawa
Bismarckk
g
Billings
Boise
40s
Montreal
40s
A
g t
Augusta
T
Toronto
Pau
Mpls./St.. Paul
A
b nyy
Albany
10s
40s
70s
oux FFalls
ll
P
Pierre Sioux
80s
70s
U.S. Forecasts
50s
t
Boston
60s
Ice
Today
Hi Lo W
26 19 pc
64 47 pc
35 17 pc
60 52 r
26 9 sf
23 5 pc
40 34 c
55 49 sh
34 22 pc
35 27 c
57 51 sh
38 24 sn
42 36 sh
23 17 pc
37 19 pc
Tomorrow
Hi Lo W
35 28 pc
65 54 pc
33 22 s
64 53 sh
28 14 s
22 13 s
42 35 sh
57 43 r
39 27 pc
41 31 sf
55 46 r
38 26 sf
44 37 c
29 24 pc
34 21 s
International
City
Amsterdam
Athens
Bangkok
Beijing
Berlin
Brussels
Buenos Aires
Calgary
Dubai
Dublin
Edinburgh
Hi
48
60
92
35
29
48
88
26
71
47
46
3
4
5
6
7
8
11
18
24
25
28
21
26
33
34
40
Today
Lo W
41 sh
53 c
75 s
13 s
26 c
41 sh
69 t
7 pc
62 s
38 sh
38 sh
Tomorrow
Hi Lo W
46 41 sh
65 55 pc
92 76 s
35 13 s
30 26 pc
47 42 sh
78 61 t
17 3 c
73 66 s
46 35 sh
44 38 sh
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
Tokyo
Toronto
Vancouver
Warsaw
Zurich
Today
Hi Lo W
46 37 sh
47 39 r
74 61 sh
71 66 r
45 39 c
88 76 t
50 43 c
87 60 pc
51 43 sh
59 40 r
88 75 s
74 60 sh
64 46 sh
39 29 pc
5 -1 sn
92 72 pc
50 42 sh
86 72 t
60 47 pc
60 49 r
85 70 pc
39 21 pc
57 45 c
85 77 c
71 67 r
78 68 r
59 46 s
13 4 pc
39 31 pc
18 6 s
43 31 sh
Tomorrow
Hi Lo W
45 39 sh
42 36 sh
76 63 s
73 65 sh
51 44 r
88 77 t
54 43 s
89 62 s
49 41 sh
51 35 sh
88 74 s
75 59 c
67 42 pc
37 29 pc
8 0 sn
91 72 pc
49 43 sh
87 71 pc
68 46 s
62 46 r
84 72 pc
32 20 pc
50 42 r
86 77 c
71 65 sh
78 67 r
59 44 pc
25 20 s
41 35 c
19 15 sf
41 31 sh
41
42
36
37
38
43
53
54
55
56
60
61
62
63
64
65
57
58
59
AFFRONTS | By Damien Peterson
15 Japanese game
akin to chess
16 Twaddle
17 Make intense
concentration
possible?
19 Mare morsel
20 Get some
exposure?
21 Comfortable
23 Pale wood
26 Colon portion
27 Trick
28 Add, as copier
paper
30 Menu category
31 Put tags on the
merchandise?
33 For the entire
U.S.
34 Item in a shell
35 Tokyo, for the
2020 Olympics
50 They’re
numbered in
NYC
40 Stinging insect
41 Get taken in by
42 Part of LGBTQ
43 Fills in
10 Give a
misleading
version of
44 Hamper
45 Pellagra
preventer
11 Philanthropist
Astor
46 Put out
12 Peripatetic
person
49 Chips, across
the pond
13 Frolicsome
fauna
52 Coat before
cooking
18 Aerial footage
aid
54 Euro
precursor
22 Ace
52 Politico’s core
supporters
53 Allure
56 Wrong answer
to a sentry
23 Shortstop
Trammell
57 Growing number
55 Business that
many motels
are in?
24 Common crash
site
58 Justice
Department div.
60 Risk roller
25 Knife handle
59 Slip up
62 Bright-eyed
44 FDR or JFK
63 Ruin
47 Small gain
64 “Poems are
made by fools
like me” poem
49 Supplied with
sustenance
38 Chiding sounds
9 Pets with spiny
crests
51 Whole heap
39 Declare support
for Bartlett’s
work?
48 Mean
37 Small
denomination
6 Comparison to
a fiddle
8 Mythical flyer
50
52
14 Diet forbidding
wheat and dairy
36 Big name in
escalators
7 Mutton serving
49
11 Hipster address
32 Ornamental
mat
4 Early
roadsters
35
48
6 Like the smell of
burning rubber
30 Surgical
souvenirs
3 Loser to
Franklin
22
47
Across
1 That’s a wrap
29 Becomes wider
5 Army post near
Trenton
46
51
27 Attack en masse
Down
1 Place for peels
2 Potent joe
30
32
39
13
27
29
45
12
19
31
44
10
16
20
23
9
15
17
61 Gallows sight
65 Offend the
innocents
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
35 31 sf 36 25 i
Atlanta
45 27 s
45 28 s
Austin
54 29 s
54 40 r
Baltimore
35 15 pc 34 16 s
Boise
35 29 c
40 32 c
Boston
28 13 sf 27 21 s
Burlington
8 -1 sf 20 14 pc
Charlotte
45 22 s
41 20 s
Chicago
29 16 sf 31 22 s
Cleveland
26 15 sf 31 19 s
Dallas
51 30 s
48 37 pc
Denver
40 25 pc 46 23 pc
Detroit
25 13 sf 29 19 s
Honolulu
80 70 pc 80 69 pc
Houston
58 34 s
54 42 pc
Indianapolis
30 17 sf 31 20 s
Kansas City
28 20 s
38 28 pc
Las Vegas
52 44 c
52 44 sh
Little Rock
43 24 s
45 26 pc
Los Angeles
61 50 r
57 45 r
Miami
71 58 c
73 67 pc
Milwaukee
27 16 pc 30 24 s
Minneapolis
24 15 pc 28 25 pc
Nashville
39 22 pc 43 25 s
New Orleans
57 39 s
56 49 pc
New York City
32 14 pc 32 23 s
Oklahoma City
41 24 s
43 32 pc
2
70s
60s
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.
1
14
30s
rtford
Hartford
k
Milwaukee
Detroit
Buffalo
New
Yorkk
ew Y
70s
30s
g
Chicago
P
hilad
h
p
h
Philadelphia
Cleve
d
Cleveland
Reno
es Moines
i
Des
Salt LLake
ake City
City
C
h y
Cheyenne
Pittsburgh
Pittsbur
b h
80s
h
Omaha
20s
Sacramento
Springfield
Denver
90s
hington
hi
gton D.C.
DC
Indianapolis 20s Washington
an Francisco
i
San
30s
Topeka
Topeka
C
Colorad
Colorado
City
Ch l t
Charleston
100+
h
d
Richmond
L
Las
Springs
L
St.. Lou
Louis
50s Vegas
LLouisville
Lou
hit
40s Wichita Kansas
Veg
City
l igh
h
Raleigh
30s
Ange
Los A
Angeles
Nashville
h
ill
Charlotte
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a foot behind the high-school 3point line.
He’s only become more audacious in his first college season.
There are some coaches who
would rather eat worms than entrust their teams to a freshman
point guard, but Kruger saw Young
play enough at Norman North
High School, only 15 minutes from
his office, that he figured he could
handle the responsibility. Oklahoma is now shooting more 3pointers and pushing the tempo
more than any team in Kruger’s
long career.
The other team has no choice
but to guard him far away from
the basket after they’ve seen his
high-arcing shots drop. Young has
the green light to shoot from intergalactic distances because the
extra space only makes it easier
for him to score around the basket
(he shoots 55.8% at the rim) or
pass to a teammate for a high-percentage look (he assists on 58.4%
of the Sooners’ baskets—by far the
nation’s highest assist rate).
Young benefited from coming
after Curry. He has an intuitive understanding of the most intelligent, most effective way to play
basketball today.
“I feel like it’s you shoot a 3 or
you get all the way to the rim,” he
said. “The game has shifted in the
direction that I play.”
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
He came into his own as a point
guard around the time Golden
State was unleashing Curry. The
Warriors had come to realize that
Curry would be at his most effective only if he were allowed and
encouraged to do things that nobody had ever done. Young’s game
might be entirely different if they
hadn’t. His father Rayford was a
guard at Texas Tech in the late
1990s—and when Trae watches
those games now he feels like he
might as well be watching rhythmic gymnastics. It was a different
sport altogether. It hadn’t been
revolutionized by Curry.
“Nobody has ever tilted the
floor like Steph does at such a
deep range and with such incredible ball-handling skills,” Warriors
coach Steve Kerr said. “It’s crazy
what he does to the defense.”
One of the fascinating things
about Young being part of this
generation is the sheer amount of
data that already exists about him.
Young’s high-school and summer
teams had the footage of their
games turned into box scores and
detailed shooting charts by a company called Krossover.
Every one of his 2,090 shots between April 2015 and April 2017
was entered into Krossover’s database. They show that Young really
did stretch the court. He took
43.8% of his shots from more than
Previous Puzzle’s Solution
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THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | A14A
NY
* *
GREATER NEW YORK
Cuomo to Sue Over U.S. Tax Law
In annual address,
governor rails against
cap on key deduction,
outlines liberal agenda
ALBANY—New York Gov. Andrew Cuomo on Wednesday laid
out a sweeping liberal agenda
for the year, and said he would
challenge in court a new federal
law that may hurt states with
high state and local taxes.
A Democrat running for a
third term, Mr. Cuomo gave a
90-minute annual State of the
State speech at the capital’s
Empire State Convention Center, saying he aspires to a philosophy of “pragmatic progressivism” carved out by his
father, late Gov. Mario Cuomo.
He also laid out a list of issues
he said were threats to the
state, including the new federal
tax law and a divisive political
culture nationally.
But facing a $4 billion budget deficit, Mr. Cuomo didn’t include some of the high-price
projects he has in years past
and instead stuck largely to social policy and partisan battles
with national leaders.
“2018 may be the toughest
year New York has faced in
modern political history,” the
governor, 60 years old, said
before a crowd of several hundred people, including most of
the state Legislature and New
York City Mayor Bill de Blasio.
“Outrage is not enough. Enlightened government must
seize the moment.”
Mr. Cuomo, for much of 2017,
was more reluctant than some
of his fellow Democrats to attack Republican President Donald Trump. But he has recently
STEVE REMICH FOR THE WALL STREET JOURNAL
BY MIKE VILENSKY
New York Gov. Andrew Cuomo at his annual State of the State address in Albany on Wednesday.
State of the State
Speech Highlights
Criminal Justice: New York
Gov. Andrew Cuomo said he
would push the state corrections department to establish
new safety regulations for inmates at local jails and close
facilities that don’t adhere to
them.
The governor also is seeking to end cash bail for people
arrested on many misdemeanor
and nonviolent felony crimes.
Harassment: The governor
proposed barring the use of
public dollars to settle sexualmisconduct claims and to mandate that companies doing
business with the state disclose the number of internal
sexual-harassment agreements.
Transportation: Activists had
expected more concrete plans
for improving New York City
subways, but Mr. Cuomo said
only that the system needed an
investment and he was exploring options for charging Manhattan motorists and using the revenue for subway repairs.
Divestment: On the heels
of saying he wanted the state
pension fund divested from fossil-fuel companies, Mr. Cuomo
said he would consult with
state Comptroller Thomas DiNapoli about divesting from
companies that don’t employ
adequate numbers of women
and minorities.
Homelessness: Mr. Cuomo
said state funding for local governments’ homelessness services could become conditional
on those municipalities creating
state-approved plans for combating the problem.
seized on the tax law as hurting
New York.
On Wednesday, he said his
administration would sue the
federal government over the
tax law, saying it unconstitutionally discriminates against
high-tax blue states. The law
caps the amount of state and
local taxes that filers can deduct from their federal taxes,
deductions that have been key
to New York taxpayers.
“President Ford may have
metaphorically told New York
to drop dead in 1975, but this
federal government is the most
hostile and aggressive towards
New York in history,” he said.
“It has shot an arrow aimed at
New York’s economic heart.”
Republicans in New York
have also voiced concerns about
the tax law and how it might affect suburban real-estate markets. But on Wednesday some
of them pushed back on Mr.
Cuomo’s response. “I don’t see
the legal basis,” said Senate
Majority Leader John Flanagan,
a Long Island Republican, after
the remarks, of the governor’s
planned lawsuit.
Part of Mr. Cuomo’s plan to
fight the tax bill was a pledge
to work with lawmakers and tax
experts on exploring wholesale
changes to the state tax code.
Additionally, Mr. Cuomo threw
his weight behind closing the
so-called carried interest loophole, a federal rule that benefits
private-equity and hedge-fund
managers and came under criticism from both parties in the
2016 presidential election. The
provision allows much of the
compensation for private-equity
and hedge-fund managers to be
treated as capital gains, which
are taxed at a lower federal rate
than ordinary income.
It wasn’t clear Wednesday
how Mr. Cuomo might affect
the carried interest rule from
the state level. A past New York
legislative proposal sought to
impose a state tax on part of a
fund manager’s profits, offsetting the carried interest break.
Mr. Cuomo’s proposals were
expected to be fleshed out in
the coming weeks when he releases his budget proposal. On
Wednesday, Democratic lawmakers largely signed on to Mr.
Cuomo’s plan while the GOP-led
Senate expressed skepticism.
“There was a tremendous
amount of focus on the federal
government [in the remarks],”
Mr. Flanagan said. “First, let’s
look at what we’re doing in our
own state.”
Legislators Seek Waterfront Commission Exit
New Jersey lawmakers are
trying to pull out of the Waterfront Commission of New York
Harbor, a bistate agency designed to combat the organized
crime and racketeering that have
long plagued the port industry.
Legislators say the commission, established in 1953 by
Congress in response to widespread corruption and mafia
involvement at the ports in
New Jersey and New York, is
no longer necessary. The commission’s rules make it difficult for shipping companies to
hire new workers, they say.
A bill to direct New Jersey’s
governor to pull out of the
compact unanimously passed
the state Senate in early December and will be voted on in
the Legislature’s lower chamber Thursday. If it passes, the
legislation will go to Republican Gov. Chris Christie before
he leaves office in mid-January.
Republican Assemblyman Jon
Bramnick, a sponsor of the bill,
said corruption isn’t nearly as
prevalent as it was when the
commission was formed. “I
don’t think it’s doing any work
that couldn’t be done by the
state police or by the FBI or by
the U.S. attorney’s office at a lot
lesser cost,” Mr. Bramnick said
of the commission.
The Waterfront Commission
works with federal and local
prosecutors in New York and
New Jersey to bring criminal
cases. The commission, which
has an annual budget of about
$13 million, is funded through
fees levied on shipping and related commerce.
Commission officials say
STEVE REMICH FOR THE WALL STREET JOURNAL
BY KATE KING
AND PAUL BERGER
New Jersey lawmakers say the Waterfront Commission, tasked with fighting corruption at New Jersey and New York ports, isn’t needed.
the port industry still needs
special oversight, citing their
assistance in the recent prosecution of several former supervisors of the International
Longshoremen’s Association,
the union that represents dock
workers. The former longshoremen pleaded guilty in
2014 and 2015 to extorting
Christmastime tribute payments from dock workers.
The commission also helped
investigate a former general
foreman and member of the
International Longshoremen’s
Association, who was convicted in October for collecting an annual salary of nearly
$500,000 while working as lit-
tle as eight hours a week.
James McNamara, a spokesman for the union, declined to
comment on allegations of the
union’s organized-crime ties
or on the New Jersey bill.
Robert Stewart, a former
head of the Justice Department’s
Organized Crime Task Force in
Newark, said he doubted the
state police had the experience
and skills to bring complex labor-racketeering cases. “The waterfront is one of the last places
where organized crime is really
very, very well entrenched,” he
said. “You have to build up an
informant network. You have to
understand as much about the
industry as those people who
are out on the pier.”
A spokesman for the New
Jersey State Police declined to
comment on Mr. Stewart’s remarks or the pending legislation.
The Waterfront Commission, whose jurisdiction spans
a 25-mile radius from the
Statue of Liberty, has a staff of
82 that includes lawyers, intelligence analysts, accountants
and about 40 officers.
This isn’t the first time New
Jersey lawmakers have tried to
withdraw from the Waterfront
Commission. Mr. Christie vetoed similar legislation in 2015,
saying that he was “not unsympathetic to the merits of the
bill,” but had been advised that
federal law wouldn’t allow one
state to unilaterally pull out of
a bistate compact that had
been approved by Congress.
Sen. Paul Sarlo, a Democrat
and sponsor of the current
bill, said he believes Mr. Christie would sign the legislation
this time around because new
legal opinions have indicated
that the state could withdraw
from the agreement without
congressional approval. A
spokesman for Mr. Christie declined to comment.
An official with the administration of New York Gov. Andrew Cuomo, a Democrat, said
if the bill is signed into law,
“we will review the issue.”
Ex-Con
Launches
Bid for
Governor
BY JOSEPH DE AVILA
Bridgeport Mayor Joe
Ganim won over voters in his
city despite his criminal record. Now he is asking the rest
of Connecticut to give him a
chance to lead the entire state.
Mr. Ganim, who spent seven
years in federal prison for political-corruption crimes, officially launched a campaign for
governor Wednesday.
Gov. Dannel Malloy, a fellow
Democrat, declined to run for a
third term. Connecticut, where
economic growth has been
weak, is struggling financially.
The 58-year-old Bridgeport
mayor joins several other
Democrats who have declared
or expressed interest in running for governor in 2018, including Hartford Mayor Luke
Bronin, Middletown Mayor
Dan Drew and former state
Sen. Jonathan Harris. No other
potential candidate has the
baggage of a conviction for serious corruption crimes.
Bridgeport
Mayor Joe
Ganim served
seven years in
federal prison
on corruption
charges.
Mr. Ganim acknowledged
that his criminal record will be
a challenge for his gubernatorial bid, and called himself “an
unperfect candidate.” He said
he is willing to talk with voters about his past and to discuss what having a second
chance has meant to him.
“I think people at the end
of the day are going to want
the person with the best experience and someone that can
make positive change in their
lives,” Mr. Ganim said.
Mr. Ganim served as Bridgeport’s mayor for five terms before he was convicted in 2003
on 16 felonies, including racketeering and extortion. His conviction involved a scheme in
which associates funneled him
hundreds of thousands of dollars in cash, entertainment,
food and home furnishings in
exchange for city contracts.
He returned to politics in
2015 and defeated incumbent
Democratic Mayor Bill Finch in
the primary and went on to easily win the general election. “His
base is confined largely to the
city,” said Gary Rose, chairman
of the department of government, politics and global studies
at Sacred Heart University.
“If Joe Ganim is the best
that Democrats have to offer
the people of Connecticut after
nearly eight years of disastrous
failed leadership under Dan
Malloy, they’re clearly not fit to
govern the state,” said John
Burke, a spokesman for the Republican Governors Association.
Mr. Ganim will have to compete without the aid of Connecticut’s public-finance system,
where
qualifying
candidates can access $1.35
million for primary campaigns
and an additional $6.5 million
for the general election.
State law bars people convicted of political crimes from
participating in Connecticut’s
taxpayer-funded
public-finance system, called the Citizens Election Program. Mr.
Ganim said he expects to raise
enough money to run a competitive campaign.
OYSTER PERPETUAL
DATEJUST 41
rolex
oyster perpetual and datejust
are ® trademarks.
.
A14B | Thursday, January 4, 2018
NY
* *
THE WALL STREET JOURNAL.
GREATER NEW YORK
ANDREW LAMBERSON FOR THE WALL STREET JOURNAL
New Jersey Beckons Buyers
Demand grows for
expensive waterfront
condos as Manhattan
becomes too pricey
New Council Leader
Willing to Buck Mayor
BY MARA GAY
The New York City Council
selected Corey Johnson as its
speaker Wednesday, catapulting an ambitious, youthful
Manhattan Democrat into a
position considered second in
power only to the mayor.
Mr. Johnson, 35 years old,
is the first openly gay man in
the role. He is also known as a
big personality who could
shake things up. The council
has broad powers over land
use and the city’s massive, $85
billion-plus budget.
Mr. Johnson said he
planned to make the 51-member body more independent of
Mayor Bill de Blasio. He said
he was willing to pass legislation over the objections of the
mayor, a move that would be a
shift from his predecessor,
Melissa Mark-Viverito.
“As I’ve said to the mayor,
it’s not personal,” Mr. Johnson
said. “We will not flinch, nor
hesitate to do so.”
A spokesman for Mr. de
Blasio said the mayor looked
forward “to four years of productive partnership with
Speaker Johnson working to
make NYC the fairest big city
in America.”
Mr. Johnson was elected by
a vote of 48 to 1, with two of
the body’s 51 members absent.
He beat a crowded field of
more than a half-dozen candidates in a process that is officially determined by lawmakers but significantly influenced
by outside forces—namely U.S.
Rep. Joe Crowley, head of the
powerful Queens Democratic
Party, and Mr. de Blasio.
The vote was marked by
drama early on, when Councilwoman Inez Barron of Brooklyn mounted a last-minute
candidacy for speaker. “It’s
time for a black speaker,” she
said. “Race still matters.”
Though black voters hold
wide sway over the political
process in New York City, they
have few of the top positions
in government.
Mr. Johnson said he recognized “the privilege in the
color of my skin” and that he
‘As I’ve said to the
mayor, it’s not
personal,’ said the
incoming speaker.
would make sure minorities
were well represented in the
council’s leadership positions
and among his staff.
Ms.
Barron’s
remarks
touched off an unusually sharp
exchange. After several black
council members voted for Mr.
Johnson moments later, state
Assemblyman Charles Barron,
Ms. Barron’s husband, verbally
attacked them. He called one
“spineless” and accused another of voting “with your
masters.”
A penthouse apartment at Nine on the Hudson in West New York, N.J., is listed for a record $8 million.
is overseeing the development
for K. Hovnanian Homes, said
a contract has been signed on
another unit that ranks as the
third most expensive condo
sale along the river in New
Jersey by price a square foot: a
12th-floor unit in contract for
$2.45 million, or $1,535 a
square foot.
Since the project went on
the market in April 2017,
nearly 30% of the 278 apartments there have gone into
contract, Mr. Hovnanian said.
“There is no place in Manhattan where you can see all
around Manhattan,” said Eitan
Ajchenbaum, the chief financial officer of an insurance
company in Manhattan who is
in contract to buy a two-bedroom apartment at Nine on
the Hudson.
The development is situated
on a quiet stretch of shoreline
near a riverfront walkway and
a short walk or bus ride to the
Port
Imperial/Weehawken
ferry stop. From there it is an
eight-minute ferry ride to Midtown Manhattan.
Nine on the Hudson is part
of a large expanse of former
warehouses and railroad terminals along the river at the base
of the Palisades, a line of cliffs
overlooking the Hudson River.
Since the 1980s, the industrial
zone has been replaced with
new communities of townhouses and apartments.
The building has a U-shaped
design to maximize views of
New York Harbor. On the north
side, there is a conventional
13-story building with glass
walls and metallic trim. On the
south side, a second wing, with
white cast stone and floor-toceiling windows, steps down
floor by floor toward the river
with landscaped terraces. From
the Manhattan side, it looks
like a gigantic staircase to the
river’s edge.
Between the buildings is a
platform built over a parking
garage with an edgeless pool
with Manhattan views, a hot
tub, fire pits, a lawn and children’s play area. In all, there
are 32,000 square feet of indoor and outdoor amenities.
Mr. Ajchenbaum said his
new apartment has views facing north and east, giving him
a panorama of Manhattan ex-
tending from the George
Washington Bridge to Battery
Park to the Verrazano-Narrows Bridge.
He said he moved because
he wanted “the best life, and
part of it is the apartment and
the environment.” He also
cited the lower cost of living, a
property-tax abatement on the
condo and lower income taxes.
Unlike his previous residence in a Midtown Manhattan
rental tower, he said the new
area was quiet and family oriented, and “you can’t see too
many tourists.”
“If you go out to parties every night, live in Manhattan,”
he said. “I can understand why
you want to live in Manhattan.”
As Manhattan prices rise,
however, some buyers are expected to migrate west.
“To a large extent what we
see playing out now in Hudson
County are developers looking
to cash in on the high real estate costs in Manhattan by
providing an alternative,” said
Jeffrey Otteau, an appraiser
and president of the Otteau
Valuation Group Inc.
GREATER NEW YORK WATCH
CHAPPAQUA
Fire Breaks Out
At Clintons’ Property
Firefighters responded to Bill
and Hillary Clinton’s home outside New York City after a small
fire in a building on the property.
A call came in Wednesday at
about 2:50 p.m. about a fire in
Chappaqua, New Castle police
said. The fire was extinguished
by 3:15 p.m.
Clinton spokesman Nick Merrill
tweeted that the fire was in a
building used by the Secret Service, not in the Clintons’ residence.
He said the Clintons weren’t
home at the time and “all is OK!”
—Associated Press
SUBWAY CRIME
Man Dies After He
Is Pushed on Tracks
A 52-year-old man died after
he was pushed onto the subway
tracks in Brooklyn on Wednesday afternoon, police said.
The incident occurred at the
Jay St.-MetroTech station after
the victim was involved in a dispute with an 18-year-old man,
who pushed him, police said. The
victim fell back onto the train
tracks and was knocked unconscious. He was transported to a
hospital where he died, police
said. The 18-year-old is in police
custody.
—Associated Press
CONNECTICUT
Treasurer Won’t Run
For Another Term
Longtime State Treasurer Denise Nappier announced
Wednesday she won’t seek reelection to a sixth term, creating
another open seat for a constitutional office in this year’s election.
The 66-year-old Democrat
told reporters she wants to
leave office while “on top,” noting how the state’s pension and
trust funds have grown from
$19 billion to $34 billion during
her tenure.
Ms. Nappier became the nation’s first African-American
woman elected as a state treasurer in 1998, and the first
woman elected treasurer in Connecticut history.
—Associated Press
DREW ANGERER/GETTY IMAGES
Corey Johnson beat more than a half-dozen candidates for speaker.
What is a Manhattan view
worth?
One developer in West New
York, N.J., is hoping a new
penthouse apartment with a
dead-on vista of Midtown from
the banks of the Hudson River
can command $8 million.
There is growing demand
for expensive apartments on
the New Jersey waterfront as
Manhattan prices climb, brokers and anaPROPERTY lysts say. The
demand comes
mainly
from
New Yorkers looking for more
space for less money and
views with bragging rights, as
well as young pioneers lured to
the New Jersey riverfront in
recent decades who now are
raising families and looking for
larger homes in the area.
The latest entry is a topfloor, three-bedroom penthouse with 4,000 square feet
of space, a Japanese-themed
design and a large private terrace with a lawn at Nine on
the Hudson, a new development near the river in West
New York.
So far, the top condo prices
a square foot along the New
Jersey waterfront have come
in Jersey City, which has become a magnet for younger
renters and buyers. The record
price a square foot for a condominium was the January
2017 sale of a condo at the top
of 77 Hudson St., a high-rise
overlooking New York Harbor
in Jersey City, for $3.4 million,
or $1,624 a square foot. That
was 25% more than what the
condo sold for in October 2015,
according to real-estate data
site propertyshark.com.
The asking price for the
penthouse at Nine on the Hudson works out to $2,000 a
square foot.
Alexander Hovnanian, who
VDP
BY JOSH BARBANEL
A New York City Department of Transportation truck was loaded
with road salt Wednesday. A storm was expected to wallop the
Northeast with heavy snow, ice and strong winds on Thursday.
NEW JERSEY
THE STRAND
Murphy Announces
Two Cabinet Picks
Famed Bookstore’s
Owner Dies at 89
Democratic Gov.-elect Phil
Murphy said Wednesday he is
nominating a former Obama administration health adviser and a
child-welfare advocate to lead
two state agencies. Mr. Murphy
said Carole Johnson would head
the state’s Department of Human Services and Christine Norbut Beyer would lead the Department of Children and Families.
Ms. Johnson served as former President Barack Obama’s
senior health policy adviser on
the White House Domestic Policy Council, and is returning to
her native New Jersey from
Washington, D.C., to lead the
state’s largest agency.
Ms. Norbut Beyer currently is
a senior director at Casey Family
Programs, a child-welfare organization. She is a former official
with the state Division of Youth
and Family Services.
—Associated Press
Fred Bass, who for decades
ran the sprawling and beloved
Strand bookstore that had the
tag line “18 Miles of Books,” died
Wednesday at age 89.
Thousands of independent
bookstores have gone out of
business during the past 30
years, but the Strand remains a
meeting place for literary obsessives poring through its stacks of
new and used books in Manhattan’s Union Square neighborhood.
Mr. Bass, a New York City native and Brooklyn College graduate who took over the business
from his father, had worked in
the Strand as a boy and continued coming in regularly until a
few months ago. He owned and
managed the Strand along with
his daughter, Nancy Bass Wyden.
Ms. Wyden said her father
“felt working with books was
the best job in the world.”
—Associated Press
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | A15
OPINION
Make Iran Great Again
Iran erupted
last Thursday.
By Friday, the
protests
against the
government,
which began
WONDER
in Mashhad
LAND
near the AfBy Daniel
ghan border,
Henninger
had spread to
dozens of cities. So when we traveled on
Saturday to a movie theater
on Manhattan’s Lower East
Side to see “Darkest Hour,”
Gary Oldman’s portrayal of
Winston Churchill, imagine
the jarring dislocation when
the theater’s previews included a trailer for an admiring documentary of Barack
Obama’s foreign-policy making, “The Final Year.”
The preview screen filled
with expressions of earnest intent from Mr. Obama, Susan
Rice, Samantha Power, Ben
Rhodes and the Iran nuclear
deal’s handmaiden, John
Kerry. About 100 minutes
later, we were watching
Churchill shout at his war cabinet that you cannot do deals
with dictators. That would
have been about the time this
weekend that protesters in
Iran were shouting “Death to
Khamenei!” It’s nice to see the
Iranian people have a sense of
humor.
Producing the past week’s
protests against the Iranian regime was not the goal of the
six-party Iran nuclear deal.
Back then, the Khamenei-Rouhani regime was represented
as America’s partner in a good
cause. Now the governments
of the U.S., U.K., France and
Germany (Russia is a Khamenei ally, and China only supports crackdowns) have to decide whether their Iranian
partner is the people in the
streets or the government that
is shooting them.
In the preview of “The Final
Year,” the Obama team members convey confidence in the
rightness of everything they
did. But as we learned in November 2016, there was one
big thing the Obama people
never understood: how a real
economy works. By real economy, I mean the private economy, not the economy of public spending.
A central element of the nuclear deal was that it would
“help” the Iranian people by
lifting sanctions and injecting
$100 billion of unfrozen assets
into Iran’s economy. This was
much the same economic
theory behind the Obama administration’s 2009 injection
of $832 billion into the U.S.
economy. Both flopped because both made the real economy essentially a bystander to
state guidance.
The Obama $832 billion
went up the government’s fireplace flue. The Iranian $100
billion went into ballistic missile production and for Iran’s
proxies in Syria, Yemen, Lebanon and the Gaza Strip.
The moment has arrived for
invidious comparisons.
Donald Trump is president
because the Obama-Clinton
Democrats forgot about hardpressed voters in Pennsylvania, Wisconsin and Michigan.
The Khamenei-Rouhani regime
is under assault because working-class Iranians began this
week’s revolt in cities beyond
the capital.
Come to think of it, isn’t
that disconnect between the
people running governments
and the people trying to make
a living in the real economy the
core reason behind the worldwide burst of populism?
It’s the reason France’s
working-class voters and young,
underemployed college graduates sent Emmanuel Macron
Like Barack Obama,
Tehran’s rulers don’t
know how a real
economy works.
and a heretofore nonexistent
party into the French presidency. It’s the reason workingclass Brits lunged for Brexit.
This new global reality—perform or get shoved aside—is
the reason Saudi Arabia’s Prince
Mohammed bin Salman imposed reforms.
The Iranians shouting,
“Leave Syria, think of us!” are
the West Virginia coal miners
shouting, “Make America
Great Again.” That’s not yahooism. It is anxiety directed
at incumbent elites who tell
the public that reduced levels
of economic growth are the
new normal. The world’s populations will not accept that.
Iran—like North Korea—
has taken its best and brightest and stuck them inside a
mountain to build atomic
bombs, leaving the economy
in the hands of Brussels-grade
technocrats.
Besides calling for higher
taxes in its recent budget, even
as prices have spiked for basic
foodstuff, Hassan Rouhani’s
government has pursued import-substitution policies by
imposing high tariffs on many
imported goods. Needless to
say, Iranians can’t get the
clothing, appliances and electronics they want.
To combat a massive cellphone-smuggling operation,
Iran recently slapped a 5% duty
on them atop the 9% valueadded tax and required registration with Iran’s telecom
user database. Now, millions of
smuggled phones will make it
harder for the ayatollahs to kill
texting among protesters. The
bazaar may prove stronger
than the theocracy.
A theme now emerging in
Western media is that if Europe’s leaders support President Trump’s “aggressive” posture toward Tehran, that will
undermine both the sanctified
Obama nuclear deal and support for “liberals” in the Rouhani government. This is where
we came in, watching Winston
Churchill convince a timid British establishment that an outward-moving dictatorship won’t
stop at anyone’s border.
The moment has arrived to
admit that Iran’s missiles, nuclear technology and armies
won’t stay inside its borders
until the people getting shot in
the streets are recognized and
supported by a too-timid
world.
Write henninger@wsj.com.
A Fortune Teller’s Reckoning in 2018
By Karl Rove
B
atting .633 in baseball is
terrific, but merely adequate in the forecasting
game. On Jan. 4 of last year, I
made 30 predictions for 2017.
Nineteen were correct. A
gimme: President Trump
tweeted often (more than
2,300 times). He held only one
full-scale solo press conference. A hefty number of senior aides—including Michael
Flynn, Reince Priebus, Steve
Bannon and Sean Spicer—
were fired or resigned.
A constitutionalist, Neil
Gorsuch, was confirmed to the
Supreme Court. Tax reform
passed under budget reconciliation. The tax cut was smaller
than Mr. Trump’s campaign
plan ($1 trillion versus $5.9
trillion over 10 years) and
ended double taxation of U.S.
companies’ foreign profits.
Tensions emerged between
congressional Republicans and
Mr. Trump. They wanted him to
quit talking about the Russia
investigation and take tough
action against Vladimir Putin.
They opposed his flirtation
with ending the North American Free Trade Agreement.
They didn’t have to draft an infrastructure bill because he
lacked a specific proposal.
Arrests of criminal illegal
immigrants rose in fiscal 2017.
The border wall is still “virtual” and Mexico refuses to
pick up the tab. Russia remains
mired in the Syrian civil war. It
continues trying to destabilize
Ukraine, undermine NATO and
weaken U.S. influence. Angela
Merkel was narrowly reelected Germany’s chancellor.
At the Oscars, “Moonlight”
won best picture and Casey Affleck took best actor.
A few of my calls were close
enough to count. Congress
raised the debt ceiling in an
ugly vote, but in March, not
April. The populist wave fell
I predict the GOP
will keep the House,
but Trump’s approval
rating will sink.
short in Europe and Marine Le
Pen lost in France, but to Emmanuel Macron, not François
Fillon. The Dutch Party of Freedom is not in government, but
it came in second (not first) in
national elections.
The most disappointing of
my 11 missed predictions was
the Senate’s failure by a single
vote to repeal ObamaCare.
Also, the courts did not strike
down the Consumer Financial
Protection Bureau’s funding
mechanism. Sanctuary cities
haven’t been forced to turn
over criminal aliens. There was
no compromise on “Dreamers.”
My friend Ed Gillespie wasn’t
elected Virginia’s governor.
Six busted calls involved
sports and movies. Clemson
beat Alabama; the Patriots defeated the Falcons (my pick, the
Cowboys, didn’t even win a
playoff game); the Astros beat
the Dodgers (who’d ousted my
selection, the Cubs); and Russell Westbrook averaged a triple-double (I thought he’d fall
short). Emma Stone, not Natalie Portman, won best actress,
and “Thor” outclassed “Wonder
Woman” at the box office.
Now to 2018. Republicans
will modestly expand their
Senate ranks, picking up two
or three seats. Although the
party in power has lost an average of 21 House seats since
1982, the GOP will retain the
lower chamber by the narrowest of margins, with just over
220 seats. Republicans will
drop to under 30 governorships and shed several hundred state legislative seats.
The Russia investigation
won’t produce evidence of collusion between the Trump
campaign and the Kremlin, but
more indictments will come.
Robert Mueller won’t be fired.
His probe will largely wind
down by year’s end but he
won’t yet have formally concluded it. The report from the
Senate Intelligence Committee
will reveal the Obama administration’s fecklessness on Russian election meddling, leading
to new legislation requiring a
comprehensive response from
the federal government to such
interference.
China will sign more trade
deals than the U.S. does. Nafta
will hang on, but barely. No
trade deal will be concluded
between the U.S. and Britain.
America’s economy will expand by more than 3%.
After delays, Mr. Trump will
sign a “Dreamer” fix this
spring including significant resources for border enforcement. No $1 trillion infrastructure program will pass, but
Congress will approve something more modest. Substantive entitlement reform will
sputter out, though lawmakers
will approve helpful small-ball
welfare improvements.
Two or more areas of new
or renewed geopolitical conflict will arise. China will grow
more aggressive. Islamic State
will increase large-scale terror
attacks. War with North Korea
won’t come, but by year’s end
the Hermit Kingdom will have
nuclear weapons and longrange missiles capable of reliably delivering them. A reelected Mr. Putin will cause
more problems for the West,
including a major incident in
Ukraine.
More research will emerge
on the adverse effects of
smartphones and social media
on mental health and child
development.
Mr. Trump’s approval rating
will end 2018 lower than it is
today. Nikki Haley’s star will
keep rising. Jared Kushner will
finish the year in worse legal
shape. Key White House aides
and at least one cabinet secretary will depart.
Christopher Plummer will
win best supporting actor for
portraying J. Paul Getty in “All
the Money the World.” Gary
Oldman will be best actor as
Churchill in “Darkest Hour,”
which should get best picture
but will lose to “The Shape of
Water.” New Year’s resolution:
I’m swearing off sports predictions (except “Roll Tide!”).
Now make your own list of
prophecies. Happy 2018!
W
hen Arjun and Priya
arrived in America
six years ago, they
came ready to contribute. Arjun landed an engineering job
in Seattle and was approved
for an H-1B visa. As his wife,
Priya was granted an H-4
visa. With a graduate degree
and years of experience in
computer programming, she
also was ready to work. But
Priya would soon be exposed
to the immigration laws that
barred her and other H-4 visa
holders from work.
As an Indian immigrant, I
have known too many husbands and wives who moved
to the U.S. with the skills
needed for a technical job but
the inability to use them.
Companies are starving for
this kind of talent. Yet on
Dec. 14, the Trump administration announced plans to
kill an Obama-era program
that allows spouses of H-1B
visa holders to work.
To see why this is misguided, it’s crucial to understand the larger system of
skilled-worker visas in the U.S.
Take the H-1B visa, a specialty
The U.S. won’t let
‘dependents’ of H-1B
holders get jobs.
worker visa. To qualify, a
worker must have at least a
bachelor’s degree (or the
equivalent) and specialized
skill in a given field.
For five consecutive years,
the demand for H-1B visas has
exceeded the annual cap of
85,000. In 2016 there were a
record 236,000 applications.
When the quota is quickly met,
immigration services select applicants by lottery, prioritizing
chance over merit and skill.
This can become absurd
very quickly. When we
wanted to move to the U.S.
from India to start our company, my co-founder, Hari,
and I had to go through the
lottery system. The U.S.
granted me a visa, while Hari
had to stay behind. Today he
helps lead the company from
Bangalore, while I run our
headquarters in Palo Alto,
Calif.
Where do H-4 visas come
in? They are given to dependents of H-1B visa holders—
spouses and children under
21. The government issues
roughly 125,000 H-4 visas
every year, approximately
80% of them granted to Indian women like Priya. Most
recipients are between the
ages of 26 and 35 and college-educated. Many applied
for an H-1B but lost the lottery. They’re forced into a
lengthy wait for a green
card, during which they are
The Next Global
Powerhouse
Our Time Has Come
By Alyssa Ayres
(Oxford, 341 pages, $27.95)
W
hen India won independence in 1947, there was
every hope that it would join the ranks of truly
consequential nations within a generation or two.
Instead it proved to be an eye-popping economic laggard
for 41/2 decades, shutting its markets to the world and
passing the years in an autarkic trance, while other
emerging nations left it far behind. A chastened India is
now deep into a seemingly unstoppable quest for greatpower status. In “Our Time Has Come,” Alyssa Ayres, a
former U.S. deputy assistant secretary of state for South
Asia and currently a senior fellow at the Council on Foreign
Relations, describes this astonishing transformation and
parses skillfully the
political revolution that
has accompanied it.
The rise of India dates to
1991, when a coalition government led by the Congress
Party “inherited an economy
on the ropes,” as Ms. Ayres
puts it. The country was so
broke that it had to sell its
gold reserves to stay solvent.
“Pawning the nation’s treasure
in distress,” she says, “represented the decisive failure of
the goal of self-reliance” so
cherished by Jawaharlal Nehru,
India’s first prime minister. Nehru was
democratic in almost all matters but the
economic, a sphere in which he was an avowed socialist. So
much so that he was unabashed to borrow language from
Lenin to describe his conviction that the best place for government was at the “commanding heights” of the economy.
The nadir in ’91 led India’s government to wake up and
smell catastrophe. It took drastic steps in July of that year to
revive the economy, including the abolition of a suffocating
licensing regime. The dismantling of trade barriers, Ms. Ayres
tells us, “marked India’s economic reentry to the world, and
of the world to India,” even as the country remained faithful
for another decade and a half to its principle of external nonalignment. This neurotic autonomy in international relations,
which she describes as Nehru’s “unique philosophical legacy,”
has now given way to “multi-alignment,” a word that
describes New Delhi’s notable willingness to form strategic
partnerships that serve its interests.
Ms. Ayres, always lucid and erudite, is at her best in her
analysis of India’s foreign policy. Nonalignment, she says,
was an external version of swaraj, or self-rule, the oneword motto of India’s independence movement:
Postcolonial India wouldn’t take dictation from anyone,
whether at home or abroad. In practice, this meant that
India remained closed to alliances with the West, and with
the United States in particular, during the Cold War, even
as its socialist pretensions pushed it into Moscow’s orbit.
Nonalignment yielded a notably anti-Western compound
when combined with India’s “persistent suspicion of foreign
capital,” which Ms. Ayres explains by urging us to recall
that “the colonization of India by the British began
commercially, with the East India Company.”
In the not-too-distant future, India could have a
$10 trillion economy, the world’s third largest
military and the world’s largest middle class.
unable to put their skills to
use.
Meanwhile, there’s aren’t
enough tech workers to fill
available jobs. There are almost 10 times as many U.S.
computing jobs open as students who graduated with
computer-science degrees.
The disparity is growing.
There has been talk of moving away from the H-1B lottery
toward a system that is based
on skill and merit. A similar
change should be enacted for
H-4 visa holders. Imagine a
process that enables someone
like Priya to prove her skills—
and contribute to the American economy.
H-1B visa workers already
have proved themselves an integral part of the American
economy. Their spouses should
become part of the conversation too.
Yet India and the U.S. have always been politically
harmonious in important ways. India is the world’s largest
democracy—Ms. Ayres calls it “a living laboratory for
politics”—and “is not a revisionist power seeking to
overturn the global liberal order.” This last is a point worth
stressing, it being a source of comfort to Washington at a
time when China appears hell-bent on replacing the Pax
Americana with its own version of a global order. What India
wants, Ms. Ayres argues, is comparatively modest: the
respect that befits a country that will soon overtake China as
the world’s most populous and edge past France and Britain
to become the fifth largest economy. Permanent membership
of the United Nations Security Council would be right and
proper, and Ms. Ayres feels that Washington should “make
good on [its] promise” of such U.N. status for India.
“We are,” she writes of India, “witnessing a country chart
its course to power, and explicitly seeking not to displace
others” as it does so. In other words, a rising India doesn’t
threaten America’s primacy and indeed could serve as a
powerful partner if the bilateral relationship is tended well.
Ms. Ayres is careful to stress that the U.S. mustn’t expect—
at least not in the near future—an alliance with India of the
sort that it has with Japan. India remains prickly about
being anyone’s “ally,” a vestige of nonalignment. But there
is a bipartisan consensus in both countries—Republican
and Democrat in the U.S., BJP and Congress in India—that
the two share far too many interests to withhold a strategic
embrace from each other. Ms. Ayres makes it clear that the
U.S. may need to sacrifice its relationship with Pakistan in
the process if that country continues to serve as a haven
for terrorist activity against India.
No account of the changing India is complete without a
reminder of its continuing underperformance in key areas.
Ms. Ayres notes that half of all India’s employed work in
agriculture, which contributes only 17.4% of GDP. The share of
manufacturing in India’s GDP is a paltry 18%, compared with
China’s 30% and South Korea’s 31%. But if India “plays its
cards right,” the next two decades, she says, “could be even
more transformative than the previous” and would confirm
the contention of Larry Summers, the former U.S. Treasury
secretary, that India “could be part of the biggest story of
our era, the coming of age of the developing world.”
Ms. Ayres draws a portrait of India in 2040—50 years
after she first set callow foot in New Delhi as a Harvard
junior—that takes the breath away. India could have a $10
trillion economy, just behind China and the U.S., as well as
the third largest military, the world’s largest middle class
and the world’s largest pool of labor. India will be, in her
phrase, “the workforce of the world”: One in five of the
globe’s workers will be Indian at a time when the West is in
possibly irreversible demographic decline. With this in
mind, Ms. Ayres counsels the United States to “do a better
job preparing our own next generation to understand and
work with this complex country.” India, for its part, has an
even harder task. It needs to deliver.
Mr. Ravisankar is CEO and
a co-founder of HackerRank.
Mr. Varadarajan is a fellow at Stanford University’s
Hoover Institution.
Mr. Rove helped organize
the political-action committee
American Crossroads and is
the author of “The Triumph of
William McKinley” (Simon &
Schuster, 2015).
Visa Policies Keep Women From Working
By Vivek Ravisankar
BOOKSHELF | By Tunku Varadarajan
.
A16 | Thursday, January 4, 2018
* *
THE WALL STREET JOURNAL.
OPINION
L
REVIEW & OUTLOOK
LETTERS TO THE EDITOR
Fusion’s Russia Fog
Civil Service Reform: An Idea That Is Overdue
et’s see. The Clinton campaign hires FuAs Mr. Browder notes on Twitter, the Fusion
sion GPS, an opposition research firm, op-ed also “conveniently omits” that it “worked
to investigate the Trump campaign. Fu- for Russian gov’t interests trying to repeal Magsion hires a former British spy,
nitsky Act [sanctions] at the
The Steele dossier
Christopher Steele, who prosame time [it] was working on
duces a dossier based on Rusthe dossier.” Mr. Simpson met
hit men now claim to
sian sources full of rumor,
with his Russian client, Krembe political victims.
hearsay and an occasional fact
lin-connected lawyer Natalia
to allege collusion between
Veselnitskaya, before and afthe Kremlin and Trump camter she sat with Donald Trump
paign. The dossier gets to the FBI, which uses Jr. in Trump Tower in June 2016.
it to justify opening a counterintelligence probe
Mr. Simpson continues to claim he knew
of the Trump campaign, perhaps including a ju- nothing about her Trump meeting and that she
dicial warrant to spy on Trump officials. Then knew nothing of his Steele dossier work—
Fusion has Mr. Steele privately brief select me- though you’ll have to take his word for the coindia reporters, ensuring that the dossier’s con- cidence. As for Fusion’s deep concern about “an
tents become public before the election.
attack on our country by a hostile foreign
And now Fusion GPS complains about being power,” the firm’s concern about Russia—and
a victim? Only in Washington, folks.
its human-rights abuses, for which the Magi
i
i
nitsky sanctions were imposed—would seem to
That’s the sob story spun by Fusion GPS stop at its bank account.
founders Glenn Simpson and Peter Fritsch
Far from being victimized, Fusion has been
Wednesday in a New York Times op-ed that protected by a Beltway press corps stocked with
matches the Steele dossier for disinformation. allies who rely on the firm for scoops. Fusion
The Fusion duo portray themselves as val- also has friends in the FBI and Justice Departiantly working to “highlight Mr. Trump’s Rus- ment who have a mutual interest in blocking
sia ties” by providing the FBI with “intelli- Congress from discovering how the dossier was
gence reports” that corroborated “credible used to investigate the Trump campaign.
allegations of collusion between the Trump
Toward that end, the New York Times recamp and Russia.”
ported on the weekend that the real Rosetta
For exercising their “right under the First Stone of the Trump-Russia probe was a drunken
Amendment,” Fusion laments that it has been conversation in May of 2016 by junior Trump
subject to Congressional harassment and a staffer George Papadopoulos. This narrative
“succession of mendacious conspiracy theo- would have us believe that the FBI hinged its
ries,” including by us. Oh my.
probe on a man it didn’t bother to interview unFusion is talented at producing dirt for hire, til 2017, and about whom it didn’t brief Conincluding for Russians to smear human-rights gress until months after the election.
activist Bill Browder. The problem is the veracBy the way, the FBI or Justice Department
ity of its work, and the cofounders don’t name sources who leaked this story almost surely
a single example in their op-ed of something broke the law in disclosing classified informathat proves the dossier’s claim of collusion be- tion about details collected by intelligence
tween the Trump campaign and Russia. Eigh- agencies about the meetings and conversations
teen months after the dossier hit Washington, of Mr. Papadopoulos, a private citizen. Yet the
the FBI, special counsel Robert Mueller and FBI and Justice still refuse to tell Congress how
Congress have also offered no public validation they used the Steele dossier.
i
i
i
of its collusion allegations.
Fusion now says it wants Congress to release
The Fusion boys pat themselves on the back
for “having handed over our relevant bank re- transcripts of Mr. Simpson’s interviews with
cords,” but the firm stonewalled Congressional committees, a change from his refusal last year
committees for most of 2017, refusing to divulge to appear in public session before the Senate
the names of its clients (the Clinton campaign Judiciary Committee. By all means, disclose it
and the Democratic National Committee) and all, along with FBI agent-source reports on the
even suing to prevent access to its bank records. Steele dossier and the surveillance warrant apIn court documents, Fusion has also admitted plications that Justice refuses to release.
Americans deserve to know what really hapto paying journalists during the election,
though it refuses to disclose the names, pened last year—not merely accept the obfuscation of Fusion’s political hit men.
amounts or purposes of the payments.
T
Happy New Year’s Tax
he medical device tax apparently has CEO of the Advanced Medical Technology Assomore comebacks than Mariah Carey. In ciation, cited a study of Commerce Department
the first minutes of 2018, while the pop data that “showed that the medical technology
star was redeeming herself
sector saw a loss of 29,000
Like Mariah Carey,
on ABC for her widely panned
jobs” the last time the device
New Year’s Eve performance
tax went into effect. Because
medical device tax
the year before, the 2.3% exthe tax applies to sales, comhas a second act.
cise tax had its own comepanies pay it even if they don’t
back after Congress had susmake money.
pended implementation for
In President Obama’s last
two years.
budget, Republicans managed to suspend the
The tax was originally imposed in 2013 to fund tax for 2016 and 2017. The assumption was that
ObamaCare. But it proved unpopular, and not the tax that nobody could defend was on its way
only among Republicans. Democrats from states to full abolition. Well, it’s 2018 and the tax has
with medical device companies squawked too. returned though the argument for it hasn’t imEven Al Franken, the unlamented former Senator proved. Republicans made a last-ditch effort to
from Minnesota, had vowed to fight this “unfair get rid of it in 2017, but when the Senate failed
burden on the medical device industry.”
to pass the “skinny repeal” of ObamaCare, the
The tax on everything from catheters, ultra- tax was fated to rise again.
sounds and X-ray equipment to pacemakers and
Republicans and President Trump can still
heart stents is a drag on one of America’s most put Democrats who criticized this tax to the test
innovative industries. In a Dec. 20 letter to by forcing a vote to kill this unhealthy levy on
President Trump, Scott Whitaker, president and jobs and innovation.
T
Trifling With the Nuclear Button
here’s little benefit in lunging at Donald he thinks he has a bigger Button.
Trump’s regular Twitter bait, as his opComments like these explain the paradox of
ponents prove nearly every day. But you Mr. Trump’s first year. He has genuine accomdon’t have to be CNN to think
plishments to boast of—inWhy Trump’s approval cluding tax reform, judicial
that the President should stop
popping off about nuclear
nominees who are reshaping
is so low despite his
weapons, whether he’s joking
the federal courts, and a stop
first-year successes.
or not.
to new regulation. Yet even
“North Korean Leader Kim
with the economy growing
Jong Un just stated that the
faster, and a tight labor mar‘Nuclear Button is on his desk at all times,’” Mr. ket beginning to bid up wages, Mr. Trump’s job
Trump tweeted Tuesday. “Will someone from approval remains below 40% in the Real Clear
his depleted and food starved regime please in- Politics average.
form him that I too have a Nuclear Button, but
The paradox results from Mr. Trump’s govit is a much bigger & more powerful one than erning behavior. His attacks on all and sundry
his, and my Button works!”
have polarized the electorate even more than
Perhaps Mr. Trump figured this was a clever it was on Election Day in 2016. He retains the
line about comparative manhood, but it’s an ex- support of his most fervent base but he has lost
ample of why even many of Mr. Trump’s voters support among many who voted against Hillary
wonder if he has any sense of self-restraint. He Clinton more than they did for him. Those
was trolling a dictator, and boasting about him- Americans tend to think that a nuclear missile
self in the process, which makes the President exchange isn’t a laughing matter.
look small. He also distracted from the Iran proAnd please don’t compare this tweet to Rontests that are vindicating his support for the ald Reagan’s 1984 quip about Russia that “we
Iranian people and discrediting his predeces- begin bombing in five minutes.” The Gipper said
sor’s appeasement strategy.
that during a sound check as a joke to radio
But more troubling is that Mr. Trump looked technicians. Mr. Trump sent his tweet around
to be trifling with the world’s most serious se- the world as a personal boast.
curity threat—a nuclear-armed rogue nation.
Voters now tell pollsters they want a DemoMr. Trump has been trying to convince the cratic Congress by more than 12 percentage
world that North’s Korea’s nuclear warhead and points. If this holds, Democrats will retake the
missile arsenal is so serious a threat that it House and Mr. Trump may be impeached. Mr.
might require pre-emptive military action. His Trump needs to win over more voters if he
main advisers, and hundreds of American offi- wants to avoid that fate, and that means acting
cials, are working day and night to diminish the more like a President. If he won’t do it for the
threat short of war. If Mr. Trump ever does have sake of his office, or for the Americans who took
to strike the North, he needs the world to be- a gamble on him in 2016, he should at least conlieve he is acting as a last resort, not because sider his own self-preservation.
Why on earth would Kimberley
Strassel think Democrats will go along
with civil-service reform (“A Big,
Beautiful Trump 2018 Issue,” Potomac
Watch, Dec. 29)? Her own words put
the lie to any such suggestion: “We
live in an administrative state, run by
a left-leaning, self-interested governing class that is actively hostile to any
president with a deregulatory or reform agenda.” This is the very definition of today’s Democratic Party. It is
buffered by a vast, left-leaning news
media whose belief is that the common American is too ignorant to make
his or her own decisions. While that is
an arguable stance, given how close
we came to a Hillary Clinton presidency, our Constitution gives us the
right to be wrong. The Democrats in
Congress will never ally with Republicans in an agenda that violates the
core of their belief system.
JIM BARBER
Mesa, Ariz.
President Trump and congressional Republicans should first seize on
the Democrats’ much-professed concern for the so-called Dreamers, created by President Obama’s Deferred
Action for Childhood Arrivals, and
propose early in January compromise
immigration reform that would trade
normalization and a path to citizenship for those younger illegal aliens
in exchange for an end to both chain
and lottery migration, an appreciable
boost in border security and a sensible overhaul of various work visa
programs, including one that would
refashion the old Bracero program
for our modern agricultural sector’s
labor needs.
Republicans don’t need to get everything they want on immigration in
2018. But getting something would be
“huuuge,” and Democrats would risk
having their mindless, anti-Trump resistance become an election-year albatross were they to refuse to back a bill
widely supported by American voters.
DARREN MCKINNEY
Washington
Let’s begin by putting Congress in
the right frame of mind and reducing
the expense of Congress to the American people.
The place to start is with congressional members’ allowance for personnel, office expenses, travel and
mail. The annual Members’ Representational Allowance for representatives who serve in the House of Representatives ranges from $1,207,510
to $1,383,709. The Senators’ Official
Personnel and Office Expense Account range is a whopping $3,043,454
to $4,815,203. Let’s cut these figures
in half and make it part of a civil-service reform bill.
PETER M. LYONS
Marietta, Ga.
Ms. Strassel gives readers a very
skewed and exaggerated perspective
of the important work by these employees under current and former administrations.
Congress identifies problems,
writes laws and directs executive
branch agencies to develop and implement regulations, which improve
the economy, public health, environment and other aspects of Americans’
lives. Executive agencies develop and
implement those regulations only after considerable input from the regulated communities and public. Staff
do not “pump out” reports without
approval by current senior administration officials.
Regarding employee compensation,
the federal workforce is highly educated. A May 25, 2017 article on the
American Enterprise Institute’s website states, “The CBO finds that the
best-educated federal employees receive lower pay than in the private
sector.” Yet Ms. Strassel bases her
claim of excessive compensation on
AEI’s 2011 report.
In my decades of experience working with federal government employees, I found them to be hardworking,
intelligent and dedicated to their
agency’s mission irrespective of the
administration’s political affiliation.
JAY ELLENBERGER
Former EPA career manager
McLean, Va.
Non-government firms require
their employees to be highly productive in order to deliver their products
or results on time. In addition, their
workforce is subject to termination
for bad performance or business declines. On the other hand, government
employees have far less of a requirement to keep a particular schedule or
cost goal, and their employment is
seldom subject to termination due to
a shortage of revenue or lackluster
performance. The overall contrast is
much greater than just the difference
in one-on-one compensation (wages,
benefits and rules) for people of similar skill levels.
ELLERY BLOCK
Westerville, Ohio
New Yorkers Pay Their Fair Share and More
The Journal should think about its
own readers before defending a disastrous federal tax bill designed to
hurt New York (“Andrew Cuomo’s
Tax Lament,” Review & Outlook, Dec.
29). The elimination of nearly all
state and local deductibility, which
the Journal inexplicably supports, is
a gross partisan assault that targets
Democratic states and will cost New
Yorkers $14 billion.
Gov. Cuomo has indicated that he
is exploring a legal challenge to this
political assault on Democratic states.
And we already know that the state
and local deduction has been a cornerstone of the federal income tax
since it was created. Now Republicans
are trampling on the same states’
rights they have always espoused.
Since day one, Gov. Cuomo has
fought to lower taxes for all New
Yorkers. Today all New Yorkers pay
a lower state tax rate than when
Gov. Cuomo took office, including
the lowest middle-class tax rate
since 1947. He is also tackling the
state’s challenge of high property
taxes, enacting a property tax cap
and calling on our myriad local governments to share services and pass
savings on to their residents.
New York is already the largest
donor state in the nation, sending
$48 billion more to the federal govThe article “Working Hard or
ernment than it gets back in serHardly Working? The Cost Adds Up”
vices. Now, instead of supporting the
(Management, Dec. 21) cites a study
governor’s efforts to ease the burden
that says workers’ idle time costs U.S. of taxes, the federal tax bill is pilferemployers more than $100 billion a
ing even more money from our hardyear. But idle time can be good. It
working families to subsidize other
must be deliberately planned in any
states.
customer-oriented service facility
ROBERT MUJICA
New York state budget director
that has uncertainty in customer arAlbany, N.Y.
rival times or service times. Otherwise the queue of customers waiting
to be served would grow without
bound. Examples include 800 numbers for technical support, hospital
Regarding the Dec. 28 Notable &
emergency rooms, the emergency
Quotable: “Words of the Year”: In
number 911, retail stores, fast food
choosing the Word of the Year, the
restaurants, U.S. post offices and
usual experts missed a bet. My pick
many more.
would have been “right?” with rising
In queuing systems, there is a daninflection. Though perfectly useless, in
gerous “elbow of performance melteveryday conversation it is inescapdown” as average server busy time
able. Right?
approaches 100% and idle time apCHARLES MOORE
proaches zero. Trying to squeeze out
Shreveport, La.
almost all idle time from servers
would be extremely costly for customers, including possible lives lost
over congested 911 call centers and
hospital emergency rooms. These new
customer costs would dwarf any “savings” associated with reduced server
THE WALL STREET JOURNAL
idle times. Not all idle times are
equal. Some must be deliberately
planned or system performance degrades to intolerable levels.
PROF. RICHARD C. LARSON
Massachusetts Institute
of Technology
Cambridge, Mass.
Some Idle Time Serves
Customers and Providers
The Right Word of the Year
Pepper ...
And Salt
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.
“That’s my sock drawer—just wanted
you to see how organized I am.”
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | A17
OPINION
America’s Alarmingly Archaic Arsenal
By Mark Helprin
The U.S. nuclear deterrent
has kept the peace for
years. If it withers, it will
keep the peace no longer.
Alone of all crucial elements, the
failure of America’s nuclear deterrent is capable of bringing instant
destruction or unavoidable subjugation, as the deterrent’s unarrested
decline will lead to either the opportunity for an enemy first strike or
the surrender of the U.S. on every
foreign front and eventually at
home.
Believers in total nuclear abolition fail to recognize that if they are
successful, covert possession of just
a score of warheads could mean
world mastery. And though they, like
everyone else, are routinely deterred
(from telling off the boss or driving
against the flow of traffic), they fail
to extend their understanding to nuclear deterrence. They seem as well
not to grasp that whereas numerical
reduction from tens of thousands of
warheads would reduce the chances
of accident, below a certain point it
would tempt an aggressor by elevating the potential of a successful first
strike. Nor do they allow that Russia, China, North Korea, and Iran—
which have through their conduct of
war and in suppressing their populations callously sacrificed more than
100 million of their own people—
PHIL FOSTER
T
he Trump administration’s
recently unveiled National
Security Strategy is an excellent and overdue statement of intent. But unless
it is ruthlessly prioritized, political
and budgetary realities will make it
little more than a wish list. And in
regard to nuclear weapons, it hardly
departs from the insufficient
Obama-era policy of replacing old
equipment rather than modifying
each element of the nuclear triad to
meet new challenges.
National survival depends on
many factors: the economy, civil
peace, constitutional fidelity, education, research, and military strength
across the board. Each has a different timeline and resiliency. Nuclear
forces, on the other hand, may have
a catastrophically short timeline
combined with by far the greatest
immediate effect.
subscribe to permissive nuclear doctrines and thresholds radically different from our own.
The Obama administration understood nuclear rejuvenation to mean
merely updating old systems rather
than changing the architecture of
the deterrent to match Russia’s and
China’s programs, as well as advances in technology. Given that
short of abject surrender the sole
means of preventing nuclear war is
maintaining the potential to inflict
unacceptable damage upon an enemy and/or shield one’s country
from such damage, what are our resources, and against what are they
arrayed?
The “nuclear triad” commonly
referred to is rather a pentad, its
land, air, and sea legs joined by
missile defense and the survivability of national infrastructure. America’s land leg comprises static, silobased missiles, which (other than in
the potentially catastrophic launchon-warning posture) are vulnerable
not only to nuclear strike, but, with
soon-to-come millimeter accuracy,
even to conventional warheads.
Russia, China, and North Korea
have road-mobile missiles (and Russia, additional rail-based ones),
making their land legs more survivable and in the case of tunnel systems—of which we have none and
China has 3,000 miles—unaddressable and uncountable.
The U.S. air leg consists of ancient bombers and outdated standoff
cruise missiles, both vulnerable to
Russian and Chinese air defense,
along with only 20 penetrating
bombers, the B-2. To boot, the
planes are concentrated on only a
handful of insufficiently hardened
bases.
Our sea-based nuclear force, the
least-vulnerable leg, for many years
included 41 ballistic-missile submarines, SSBNs. These dwindled to 18,
then 14, and, with the new Columbia
class set to enter service beginning
only in 2031, a planned 12. A maximum of six at sea at any one time
will face 100 Russian and Chinese
hunter-killer subs. At the same time,
the oceans are surrendering their
opacity to space surveillance and
Russian nonacoustic tracking. Even
a deeply running sub disturbs the
chemical and sea-life balance in
ways that via upwelling leave a
track upon the surface.
Russia is moving to 13 SSBNs
with high-capacity missiles that
carry many maneuverable warheads;
China, with 4 SSBNs, is only beginning to build. A possible new dimension is Russia’s announced, but as
yet unseen, autonomous stealth undersea nuclear vehicle, capable of
targeting the high percentage of U.S.
population, industry, and infrastructure on the coasts. We have no such
weapon and Russia presents no similar vulnerability.
American ballistic-missile defense
is severely underdeveloped due to
ideological opposition and the misunderstanding of its purpose, which
is to protect population and infrastructure as much as possible but,
because many warheads will get
through, primarily to shield retaliatory capacity so as to make a successful enemy first strike impossible—thus increasing stability rather
than decreasing it, as its critics
wrongly believe. Starved of money
and innovation, missile defense has
been confined to midcourse interception, when boost-phase and terminal intercept are also needed.
Merely intending this without sufficient funding is useless. As for national resilience, the U.S. long ago
gave up any form of civil defense,
while Russia and China have not.
This reinforces their ideas of nuclear utility, weakens our deterrence, and makes the nuclear calculus that much more unstable.
Beyond these particulars are the
erosion of the American nuclearweapons complex and the larger defense-industrial base; the dangerous
mismatch of nuclear doctrines and
perceptions; the sulfurous fuse of
North Korea and Iran; Russian “tactical” nuclear weapons that outnumber U.S. counterparts 10 to 1; Russian programs suggesting that it is
working toward the capacity for nuclear “breakout”; 2,600 currently
deployed Russian strategic warheads
as opposed to America’s 1,590; and
consistent and brazen Russian
treaty violations.
The addition of China as a major
nuclear power now presents an
analogy to the three-body problem
in physics, in which three variables
acting upon one another create an
unpredictable and unstable system.
That is but one reason why China
must either be brought into an
arms-control regime with the U.S.
and Russia or forced by its refusal
to show its hand for all the world to
see. It is inexplicable that the U.S.
government and arms-control enthusiasts have both failed to address the fact that China, the third
major nuclear power, is totally
unconstrained.
All the above is only a précis of a
long-developing peril that, though
difficult to see upon the surface, day
by day strengthens the chances of
Armageddon or capitulation. The
only way to face it is objectively and
without fear, and the only solution
(requiring just a tiny fraction of
gross domestic product) is to correct the shortcomings and right the
balances.
America’s powerful deterrent has
kept the nuclear peace all these
years. If it withers, it will keep the
peace no longer. The nuclear problem has no adequate superlatives.
As great as all other concerns may
be, they must yield to it. For the
force to be confronted is the breaker
of nations and the destroyer of
worlds.
Mr. Helprin, a senior fellow of the
Claremont Institute, is author of
“Paris in the Present Tense” (Overlook, 2017).
The Opioid Crisis Has Plaintiff Lawyers Smelling Cash
By Dennis Kneale
A
merica’s unrivaled pharmaceutical industry develops
and manufactures more than
half of the world’s new medicines
and treatments. Its global dominance is due in part to the largely
unregulated prices and uncapped
profit margins that make America
the world’s most lucrative market.
Yet Big Pharma has an image problem: The industry has been tainted
by the opioid crisis.
Pills that were developed to
quell pain and restore quality of
life to the sick and injured have
contributed to an unprecedented
wave of overdose deaths—about
64,000 in 2016. That’s more Americans dead in one year from opioids
than were killed during the 19-year
conflict in Vietnam.
Where there is death, plaintiffs’
lawyers follow. Lawsuits related to
the opioid crisis could eventually
grow into one of the largest torts
since the $246 billion settlement
exacted 20 years ago from the tobacco companies by attorneys general in 46 states. In the opioid onslaught, as in the tobacco case, a
small gang of lawyers have teamed
up with state, county and city governments to file lawsuits—more
than 100 so far—against drug companies in various jurisdictions.
Forty-one states have joined forces
to subpoena information from Allergan Inc., Endo International,
Johnson & Johnson’s Janssen unit,
and Teva Pharmaceuticals, the four
biggest makers of opioids. The No.
1 target may be OxyContin creator
Purdue Pharma. An October story
in the New Yorker alleged that
Purdue, owned privately by the
Sackler family, had raked in billions of dollars by fabricating
claims that the drug posed no risk
of addiction.
Drug manufacturers
need to get proactive
or they risk going the
way of Big Tobacco.
The anti-opioid lawyers are aiming way beyond the manufacturers,
targeting retailers for selling the
drugs, doctors for prescribing
them, and even wholesale distributors for transporting them. McKesson, the nation’s largest wholesale
distributor of drugs to retailers, got
scalped last month on “60 Minutes.” The program accused the San
Francisco-based company of negligence for filling orders for millions
of pain pills while failing to report
suspicious patterns to regulators,
as required. Even if McKesson had
followed proper paperwork procedures, the segment implied, it still
did wrong by shipping so many
millions of pain pills.
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The rush of lawsuits is accelerating, although just 23% of the drugoverdose deaths in 2016 involved
narcotics that had been legitimately
prescribed by doctors, according to
government data. Almost 60% of
overdose deaths in 2016 involved
heroin, fentanyl and other street
drugs. But drug dealers lack the
deep pockets of drugmakers and retailers; like Willie Sutton, lawyers
know to go where the money is.
Plaintiffs’ lawyers in the 1990s
didn’t sue trucking companies for
transporting cartons of cigarettes.
But today’s litigants may be casting
a wider net because of three clear
differences between opioids and cigarettes. First, the drugs have therapeutic value that cigarettes don’t.
Second, no one has yet been able to
prove that drug companies lied
about or covered up addiction risks
the way tobacco companies did. Finally, opioids have long been regulated by the Food and Drug Administration, while cigarettes came under
FDA oversight only in 2009.
These mitigating factors could
shield the pharmaceutical industry
from Big Tobacco’s fate, but certain
ugly facts could end up costing
drugmakers billions in damages,
both financial and reputational. As
the Charleston Gazette-Mail discovered in a Pulitzer Prize-winning
2016 investigation, wholesalers
shipped 780 million opioid pills
into West Virginia between 2007
and 2012—enough to provide every
man, woman and child in the state
with 433 pain pills each.
Big Pharma needs to get out in
front of this unfolding threat to
the industry’s survival. Opioid
makers should start by declaring a
voluntary moratorium on the number of pills they produce and an
end to their aggressive marketing
to doctors and patients. They also
could convene a public meeting of
manufacturers, distributors and retailers to brainstorm ways of stemming the epidemic. Further consultations with doctors, nurses,
patient representatives and addiction experts could help develop
longer-term solutions.
Drug companies also should join
forces and hire a veteran litigator
from the tobacco wars to help them
devise a pre-emptive settlement
that sets up a fund to pay for medical treatment and addiction counseling. It’s going to be costly—$25
billion would be getting off cheap—
but the costs of doing nothing could
ultimately prove much higher.
Mr. Kneale is a media strategist
and co-author, with Michael Sitrick,
of “The Fixer: Secrets for Saving
Your Reputation in the Age of Viral
Media,” to be published Jan. 8.
Notable & Quotable: NHS
From a report in London’s Daily
Telegraph, Jan. 3:
Every hospital in the country has
been ordered to cancel all non-urgent
surgery until at least February in an
unprecedented step by NHS [National
Health Service] officials.
The instructions on Tuesday
night—which will . . . result in around
50,000 operations being axed—followed claims by senior doctors that
patients were being treated in “third
world” conditions, as hospital chief
executives warned of the worst winter
crisis for three decades.
Hospitals are reporting growing
chaos, with a spike in winter flu leaving frail patients facing 12-hour
waits, and some units running out of
corridor space.
Sir Bruce Keogh, NHS medical director, on Tuesday ordered NHS
trusts to stop taking all but the
most urgent cases, closing outpatients clinics for weeks as well as
cancelling around 50,000 planned
operations.
Trusts have also been told they can
abandon efforts to house male and female patients in separate wards, in an
effort to protect basic safety, as services become overwhelmed.
The chaos follows a rise in flu
cases when many hospitals were already close to capacity, with high
numbers of frail patients stuck on
wards for want of social care. . . .
One ambulance trust resorted to
taxis to ferry patients to hospital,
while another asked patients to find
a family member to get them to hospital, with paramedics stuck outside
A&E [accident and emergency] units
in record numbers.
Health officials said pressures on
the NHS were expected to continue
to rise, with flu levels surging.
Unions Won’t
Solve Higher
Education’s
Problems
By Paul H. Tice
I
don’t know anything about cars,
but I’m about to become a cardcarrying member of the United
Automobile Workers union. How did
I accomplish this feat? By becoming
an adjunct professor of finance.
In 2004 New York University
agreed to the unionization of its adjunct faculty, signing the first of
three collective-bargaining contracts
with the UAW’s Adjuncts Come Together, Local 7902. Union membership kicks in at a minimum 40 hours
of class time in an academic year,
which amounts to one full-semester
course meeting three hours a week.
That’s meant to be a low threshold, at
which point any NYU adjunct must
pay 1.44% of gross annual wages to
the UAW. Even if I don’t join the
union, I’m required to pay.
I know nothing about cars.
As an adjunct professor
of finance, I have to join
the United Auto Workers.
I have a day job, but most adjuncts
are not so-called hobby professors.
They are highly educated and either
formally trained or clinically experienced but still shut out of the higherpaying tenure track in the academy’s
rigid caste system. To make a living,
many cobble together part-time positions at multiple institutions.
Based on data tracked by the
American Association of University
Professors, the national average pay
for adjuncts is about $3,000 a course.
For a 12-week full-semester course
with more than 25 students, that
amounts to minimum wage after factoring in time for class preparation,
office hours and grading.
Inside Higher Ed estimates some
750,000 adjunct professors teach in
the U.S.—roughly 50% of all faculty
appointments. At an average adjunct
salary of $30,000 and an annual dues
rate of 1.4% to 2%, that translates into
potential revenues of $350 million to
$450 million a year. That’s why the
UAW and other declining unions—private- and public-sector, education-related and not—target adjunct professors for unionization.
But rather than improving the
working lives of adjuncts, unionization will mainly reinforce the status
quo, providing unions with a permanent class of dues-paying members
and universities with a perpetual
supply of low-cost labor.
Adjuncts function as a financial
pressure-relief valve for universities,
allowing tuition dollars to flow to
other priorities—administration, recruiting, athletics, student clubs and
services—while keeping down the
student-to-faculty ratio, heavily
weighted in college rankings.
The solution to adjunct pay and
quality-of-life issues is not unionization but better management. Colleges
should be run less like charities that
depend on regular donations of
money and time. Instead, they should
borrow some of the best performance-driven practices from Wall
Street and Silicon Valley.
First, teacher compensation should
be decoupled from tenure-related titles and status considerations—as in
the typical investment bank, where
vice presidents often get paid more
than managing directors.
Second, all university instructors,
tenured or not, should be forced to
compete for students and curriculum
airtime, then paid equally on a subscriber model based on student demand.
Third, 40% to 50% of every tuition
dollar should be paid out in the form
of teacher wages and benefits—the
current figure is roughly 30%—with
larger classes paying more given the
incremental work involved.
Such a proposal would result in
fewer teaching positions overall and
a tighter vetting process for adjuncts
in particular. It would also require a
long-overdue clean-out of frivolous,
esoteric and politicized curriculum
that has built up at many universities
and liberal-arts colleges. Most positively, it would give tenured professors a financial incentive to teach
larger foundational lecture courses,
where their knowledge base and experience have been sorely missed for
years now.
As for me, since New York is not a
right-to-work state, all I can do at
this point is slap a UAW bumper
sticker on my American-made SUV.
At least my mechanic will get a laugh
the next time I bring my car in for
service.
Mr. Tice works in investment management and is an adjunct professor
of finance at New York University’s
Stern School of Business.
.
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A18 | Thursday, January 4, 2018
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Bond Fees Sink as Banks Battle
In sizzling Asia market,
one recent offering
cost issuers a mere $1
for each underwriter
BY MANJU DALAL
Fierce competition to underwrite debt offerings in
Asia’s booming U.S.-dollar
bond market is forcing some
big global banks to work on
deals for next to nothing.
Barclays PLC and Standard
Chartered PLC were among
seven banks that recently
helped sell a total of $1.3 billion in dollar-denominated
bonds from three state-owned
Indian companies, effectively
providing their services free of
charge. The three Indian companies paid a dollar in underwriting fees to each bank that
handled the sales, according to
company representatives and
people familiar with the matter.
A similar trend is emerging
among banks underwriting some
Chinese bond offerings, bankers
say, particularly in the case of
state-owned corporations that
have large pools of underwriters
to choose from and tend to be
stingier with fees.
Banks that agree to arrange
bond offerings for ultralow
fees generally hope to build
relationships with corporate
clients for future deals. They
also hope to generate revenue
from related businesses, such
as fees for setting up currency
swaps or on bond-trading
commissions.
In some cases, local brokerages have slashed fees to win
bond-underwriting mandates,
leading issuers to demand
global banks do the same,
bankers say.
Asian companies excluding
those from Japan sold about
$334 billion in U.S.-dollar
bonds in 2017, up 60% from
2016, according to Dealogic.
More than half the bonds were
issued by Chinese companies,
which, in many cases, enjoyed
strong investor demand for
their debt.
Market participants say
global banks’ underwriting revenue, while also up from a year
earlier, isn’t keeping up with
the accelerating pace of Asian
Never Mind Defaults, Some Venezuela Bondholders Strike It Rich
Big Boost
U.S. dollar bond issuance
in Asia*
corporate-bond issuance. It
raises concerns that this core
investment-banking business
could become largely unprofitable in the fast-growing region.
“Fee income from bonds in
Asia has not grown proportionately to deal volumes,”
said Clifford Lee, managing director and head of fixed income, treasury and markets at
DBS Bank in Singapore.
In the U.S., underwriting
fees, in recent years, have averaged about 0.7 percentage
point on investment-grade
Please see FEES page B2
Investors in some of
Venezuela's riskiest bonds
aren't battling for payments
that are arriving late or not
at all. That's because some
high-yielding bonds have
already paid them back
and then some.
Price of PdVSA bond that
matured on Nov. 2, 2017
4
100 cents on the dollar
1 Investor pays
39 cents.
90
80
1
70
3
60
3 Bond matures but
principal isn’t paid.
2
50
2 Interest payments
exceed amount paid
for bond.
40
30
2014
’15
’16
’17
4 Repayment is made.
Investor return
totals 181%.
THE WALL STREET JOURNAL.
Sources: Bulltick LLC (price); Rayner Pena/DPA/Zuma Press (photo)
RISK AND REWARD: A number of investors in the country’s debt are feeling flush, thanks to coupon payments topping 13% and large
principal disbursements that typically begin three years before a bond matures. A protest over shortages last month in Caracas. B13
Merrill Widens Its Ban on Bitcoin
BY LISA BEILFUSS
Merrill Lynch has blocked
clients and financial advisers
who trade on their behalf from
buying bitcoin, citing concerns
over the cryptocurrency’s investment suitability.
The ban applies to all accounts and precludes the
firm’s roughly 17,000 advisers
not only from pitching bitcoinrelated investments but also
from executing client requests
to trade Grayscale Investments LLC’s Bitcoin Investment Trust fund, according to
a person familiar with the
INSIDE
matter. The ban extends an existing policy barring access to
newly launched bitcoin futures.
Existing positions in the
bitcoin fund can be maintained
in brokerage accounts, but not
in fee-based advisory accounts, the person said. The
brokerage arm of Bank of
America Corp. put the policy
into place Dec. 8, right before
the launch of the first U.S. bitcoin futures, the person said.
“The decision to close GBTC
to new purchases is driven by
concerns pertaining to suitability and eligibility stan-
MANAGEMENT, B7
CRUDE-OIL
PRICES HIT
3-YEAR HIGH
COMMODITIES, B12
the firm said, and it trades
over the counter.
Merrill Lynch’s decision is
the latest sign of Wall Street’s
wariness when it comes to
digital currencies. The U.S.
brokerage arm of UBS Group
AG already bars its advisers
from trading bitcoin-related
products, according to a person familiar with the policy.
Several other firms—including
JPMorgan Chase & Co., Citigroup Inc. and Royal Bank of
Canada—told clients that they
wouldn’t offer them access to
the first bitcoin futures market when it went live Dec. 10.
300
200
100
0
2008 ’10
’12
’14
’16
*Excludes Japan
Source: Dealogic
THE WALL STREET JOURNAL.
Dominion Energy Inc. has
struck a deal to buy troubled
energy company Scana Corp.,
ushering in the final chapter
for Scana’s major South Carolina nuclear project after it became mired in controversy
and was abandoned when construction costs skyrocketed.
Dominion, a Virginia-based
gas-and-power utility, seized
on Scana’s struggles to strike
the $7.43 billion all-stock deal,
which requires a number of
state and federal approvals and
could face a tough time from
South Carolina lawmakers.
Scana’s decision to abandon
a $10 billion nuclear power
plant during construction last
year, after costs had doubled
and the company concluded it
would cost even more to complete, soured its relations with
South Carolina officials and
regulators.
Facing investigations and
legislative hearings, Scana’s
chairman and chief executive
said last year that he would
step down. The loss of political support for the company,
which has roots going back
160 years in the region, damaged it and laid the groundwork for the sale.
The deal includes several
sweeteners for South Carolina
power customers who were
upset by being forced to pay
for the unfinished plant. Upon
closing of the deal, the combined company will pay $1.3
billion to customers of Scana’s
South Carolina Electric & Gas
Co. subsidiary, or about $1,000
per customer in cash payments to be delivered within
90 days.
Dominion said it would issue new equity to help pay for
the refunds.
Under the deal announced
Wednesday, each Scana shareholder will receive roughly
two-thirds of a Dominion
share. The Dominion price
represented a premium of
more than 30% for Scana
shareholders, based on trading
prices at Tuesday’s market
close.
Shares in Scana rose nearly
23% to $47.65 on Wednesday,
while Dominion shares fell
3.9% to $77.19.
Dominion has been expanding southward from its historical base in Virginia and North
Carolina. A subsidiary already
owns 1,500 miles of naturalgas pipeline in South Carolina
and Georgia.
Scana abandoned construction of the V.C. Summer nuclear power plant last year after rising costs and delays led
to the bankruptcy of nuclear
Please see SCANA page B2
Power Ranking
Dominion's proposed acquisition of Scana would cement its place as
one of the largest utility companies in the U.S.
$0
Market capitalization, in billions
$20
$40
$60
$80
NextEra Energy
Duke Energy
Dominion Energy
Southern
Scana
Scana
Exelon
AEP
Sempra Energy
PSEG
Consolidated Edison
Xcel Energy
Source: FactSet
THE WALL STREET JOURNAL.
PERSONAL TECHNOLOGY | By Katherine Bindley
A Rival Credit Gauge
Foments Disruption Matching Up With a Dating App
BY ANNAMARIA ANDRIOTIS
AND CHRISTINA REXRODE
FREE MARKET
DRIVES DOWN
COST OF M.B.A.
dards of this product,” according to an internal memo
reviewed by The Wall Street
Journal, referring to the Grayscale fund’s trading symbol.
A spokeswoman for Merrill
Lynch confirmed the decision,
which applies firmwide and includes self-directed accounts.
The Grayscale fund is an
open-ended trust that is invested exclusively in bitcoin
and derives its value from the
price of bitcoin, according to
Grayscale Investments. It was
created for investors seeking
exposure to bitcoin through a
traditional investment vehicle,
$400 billion
Deal Aims to Resolve
Scana’s Nuclear Mess
BY RUSSELL GOLD
AND IMANI MOISE
Money in the Bank
See more at WSJMarkets.com
Banks and rival lenders are
butting heads over the credit
scores used to decide millions
of mortgage requests by U.S.
home buyers.
Now, a federal agency is
weighing whether to step into
the fight, which revolves
around a longtime requirement
for lenders that sell mortgages
to Fannie Mae and Freddie Mac
to gauge most borrowers using
FICO scores. The Federal Housing Finance Agency’s ultimate
decision could have wide-reaching ramifications for the mortgage market and home buyers
across the U.S.
Many nonbank lenders,
which in some recent quarters
have accounted for more than
half of the mortgage dollars issued in the U.S., want the ability to use a credit score provided by a company owned by
credit-reporting firms Equifax
Inc., Experian PLC and TransUnion. These lenders argue the
alternative score would open
the mortgage market to a
greater number of people and
lead to more mortgage approvals, helping to boost home sales
and the economy.
Banks generally want to stick
with the current system that
uses FICO scores, which have
been around for decades and
are created by Fair Isaac Corp.
Ditching the status quo, they
say, could lead to an increase in
consumers with riskier credit
profiles getting mortgages and
a subsequent rise in defaults.
The FHFA, which oversees
Fannie and Freddie, is weighing
whether to change its requirement to allow for the use of another credit-scoring system. In
late December, the agency
asked lenders and others for
formal input on the issue. In
doing so, the FHFA acknowledged concerns about a “race to
Please see CREDIT page B2
It is a 21stcentury moment if there
ever was one:
A 20-something daughter taking pictures of her 50something mother, who is
posing next to the fireplace,
decked out in her pearls.
Multiple poses, multiple expressions.
“She made me take like 75
shots,” says Lauryn, the
daughter.
No, it wasn’t for a Christmas card: Mom wanted to nail
the perfect dating-profile pic.
She has been on Match.com,
eHarmony and the Bumble
app.
Lauryn’s mom isn’t remotely alone. Revenue from
dating services was projected
to hit $2.7 billion in 2017, according to market research
firm IBISWorld. And in future,
the ones geared toward baby
boomers are expected to see
When matched on Bumble’s app, the woman has to message first.
the most growth.
I met Lauryn at a New York
bar while chatting up strangers about online dating. Collectively, they were a microcosm of the dating app scene.
Christine, sitting next to Lauryn, met her boyfriend of two
years on Bumble. Behind me
was Dave, who uses Bumble,
Hinge and Jdate. One of
Dave’s friends said she didn’t
know any couples who first
met at a bar. (If people don’t
meet on apps, they meet
through work.)
In other words, all the sinPlease see TECH page B4
.
B2 | Thursday, January 4, 2018
NY
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.
Ford Motor ............ A2,B7
B
Baidu...........................A8
Bank of America.........B1
Barclays.......................B1
BlackRock....................B3
Blackstone Group.......A3
BNP Paribas................B3
BP................................B3
Bulltick......................B13
C
Caesars Palace............A8
Caterpillar ................... B7
Chevron ....................... B3
Citigroup......................B1
D-E
DBS Bank...............A8,B1
Dominion Energy.B1,B14
D.R. Horton...............B13
Equifax...................B1,B7
Essence Ventures.......B3
Euronet Worldwide...B14
Experian ...................... B1
Exxon Mobil................B3
G
Gap..............................A8
General Electric.....B4,B7
General Motors...........A2
Grayscale Investments
.....................................B1
Greylock Capital........B13
H
Harvard Pilgrim Health
Care...........................B2
HNA Group ........ B12,B14
I-J
Indian Railway Finance
.....................................B2
Informatica ................. B7
ING Groep....................B3
Intel...........................B14
JPMorgan Chase....B1,B3
K-L
Kronos.........................B7
Lennar ....................... B13
LG Electronics.............A1
LinkedIn.....................B14
M
Macy's.........................B7
Marsh & McLennan ....B7
Mastercard..................A8
Match Group...............B4
Meredith......................B3
Microsoft.....................B4
Mondelez International
.....................................B7
MoneyGram
International
......................A8,B12,B14
N
Nvidia........................B14
F
O-P
Fair Isaac.....................B1
Fiat Chrysler
Automobiles.............A2
Fidelity Investments..B8
Occidental Petroleum.B3
Och-Ziff Capital
Management Group . B8
Otto...........................B14
Papa John's
International.............B7
PayPal Holdings..........A8
Polaris Industries.......B7
Power Finance ............ B2
PulteGroup................B13
R
Rent-A-Center.............B7
Royal Bank of Canada B1
Royal Dutch Shell.......B3
Rural Electrification ... B2
S
Samsung Electronics
..........................A1,A8,B4
Scana....................B1,B14
Schindler Holding ....... B4
Shields Meneley
Partners....................B7
SolarWorld..................A7
Sony.............................B3
Spark Therapeutics.....B2
Spotify.........................B3
Standard Chartered....B1
Stanley Black & Decker
.....................................B7
Statoil ......................... B3
Suniva ......................... A1
T-U
Tencent Holdings
..........................A1,A8,B3
Tesla............................B3
Time ............................ B3
Toyota Motor..............A2
TransUnion..................B1
T. Rowe Price Group.B13
UBS Group...................B1
V
VantageScore..............B2
Vapor IO......................B4
Verizon Communications
.....................................B4
Vivendi ........................ B3
W
Whirlpool .................... A1
Wilk Auslander.........B13
INDEX TO PEOPLE
A
Hollis, Jack..................A2
O
Anderson, Gregan.....B13
Auslander, Jay..........B13
J
Och, Daniel..................B8
Ojha, Dharmesh..........B2
C
Cannon-Brookes, Mike
.....................................B7
Chakravarthy, Anil......B7
Clifton, Michelle ......... B7
D
DeLongis, Alessio.....B14
Dennis, Richelieu........B3
F
Francescon, Robert...B13
G
Grenier, Bart...............B8
H
Hoffman, Reid...........B14
Hogan, Brian...............B8
Johnson, Abigail.........B8
K
P
Kang, Dawoon.............B4
Keogh, Scott...............A2
Kim, Stephen............B13
Peña, Luke...................B7
Portalatin, Julio..........B7
L
Schmidt, Florian ......... B2
Schnatter, John .......... B7
Shields, Hugh..............B7
Simmer, Sarah Jones.B4
Lee, Clifford................B1
Loree, Jim M...............B7
M
Ma, Jack....................B12
Main, Rob....................B3
Maybury, Mark............B7
McCanless, Jay.........B13
Mohatarem, Mustafa.A2
Morrison, Charles.......B8
Murphy, Kathleen.......B8
Musk, Elon..................B3
CREDIT
Continued from the prior page
the bottom” in which creditscoring systems would compete
to offer metrics that make the
most loans rather than aspire
to be the most reliable.
Credit scores help determine
who gets a mortgage and on
what terms. They played a role
in the last housing boom and
bust as lenders lowered creditscore requirements, extending
hundreds of billions of dollars
of mortgages to subprime, or
risky, borrowers.
After the financial crisis,
lenders tightened requirements
for potential home buyers. They
required higher credit scores,
making it more difficult for
some borrowers to qualify for a
mortgage.
That is why some lenders
want a change in the kind of
scores that can be used. These
lenders view FICO scores as an
impediment because they tend
to be more conservative than
alternatives.
Nearly half of mortgage dollars made in the U.S. go
through Fannie and Freddie, according to Inside Mortgage Finance, so their requirements
have huge sway over the mortgage market. Fannie and Freddie don’t make loans but instead buy them from lenders
and package them into securities that are sold to investors.
Nonbank lenders argue the
current system shuts out borrowers who don’t use credit either out of personal choice or
because they went through a
bankruptcy or foreclosure. That
is where VantageScore Solu-
Cancer Drug Priced at $850,000
BY PETER LOFTUS
Spark Therapeutics Inc.
said it would charge $850,000
a patient for a pioneering new
treatment for a hereditary
form of vision loss—below the
$1 million price tag the company had considered, but still a
milestone for ever-rising drug
prices in the U.S.
To address concerns about
the cost of the drug, Luxturna, Spark said it is offering
alternative payment arrangements to health insurers, including partial refunds if a
patient’s vision doesn’t improve significantly after treatment. The company also is
seeking U.S. government
clearance to allow insurers to
spread out payments for Luxturna in installments.
U.S. regulators approved
Luxturna last month, making
it the first therapy in the U.S.
to deliver a functional gene to
replace a faulty disease-causing one.
The injected gene therapy
treats a rare form of vision
loss caused by an inherited genetic mutation, and it improved vision in a high proportion of patients in clinical
testing. Spark intends it as a
one-time treatment, though
researchers don’t know how
long the benefit will last.
“We believe that price reflects the type of life-altering
value we’re seeing with Luxturna in clinical trials and will
allow us to build on revolutionary science,” Spark Chief Executive Jeff Marrazzo said in an
interview.
Mr. Marrazzo said late last
year that he thought the treatment—Spark’s first approved
Spark
Therapeutics’
Luxturna drug is
a pioneering way
to treat a
hereditary form
of vision loss.
product—was worth more
than $1 million a patient. But
based on feedback from insurers, the company arrived at a
lower price—$425,000 per eye
injection.
Philadelphia-based Spark
said it has reached an agreement in principle with Harvard
Pilgrim Health Care, a regional insurer in New England,
under which Spark will pay
partial refunds to Harvard Pilgrim if patients don’t meet certain targets in light-sensitivity
tests. The tests will be given
within the first 90 days and
again at 30 months following
treatment.
The companies didn’t disclose the exact size of the refunds, but Mr. Marrazzo said it
wouldn’t exceed the 23% mandatory rebate that drugmakers
pay the government Medicaid
health-insurance program for
lower-income people.
Spark said it is in discussions with other health insurers to offer similar rebates tied
to outcomes in patients. There
is a growing wave of contracts
between insurers and drugmakers that adjust the size of
payments based on how well
drugs work in patients.
Michael Sherman, chief
medical officer for Harvard Pilgrim, said in an interview that
high price tags for new drugs
like Luxturna create “a greater
need for pharma companies to
engage in these kinds of [deals]
to balance access and affordability. I think these kinds of
agreements eliminate barriers
to providing coverage.”
Prices for new drugs for
cancer and rare diseases have
been approaching the $1 million threshold in recent years,
including Biogen Inc.’s Spinraza
for spinal muscular atrophy,
which costs $750,000 for the
first year of treatment.
Allergan to Lay Off
More Than 1,000
Allergan PLC plans to lay
off more than 1,000 workers
as the drugmaker restructures
its business in anticipation of
sales declines for several key
products, including blockbuster
dry-eye drug Restasis.
Allergan, which has about
18,000 employees world-wide,
said Wednesday that the job
cuts will affect employees in
its commercial operations and
other functions. It also plans
to eliminate about 400 open
positions. Allergan didn’t specify the geographic regions
where it plans to reduce employment.
The company expects the
job cuts and other cost-savings measures to reduce operating expenses by between
$300 million and $400 million
this year. It will record the
majority of an estimated $125
million in restructuring costs
in the just-ended quarter.
Allergan, which is based in
Dublin, said the layoffs are
part of efforts to meet 2018
earnings goals.
—Aisha Al-Muslim
S
T
Townsen, Paul...........B14
W
Wien, Byron..............B13
Wine, Scott W............B7
Y
Young-ky, Kim.............B4
Heavyweights
New mortgage originations
backed by Fannie Mae and
Freddie Mac
CHUCK BURTON/ASSOCIATED PRESS
A
Access Industries ....... B3
Advanced Micro Devices
...................................B14
Alibaba Group
................ A1,B2,B12,B14
Allergan.......................B2
Alphabet......................A8
Anbang Insurance Group
...................................B14
Ant Financial Services
Group.......................B12
Apple...........................A8
Arconic ........................ B7
Atlassian.....................B7
Audi.............................A2
AXA.............................B3
80%
60
40
20
Scana abandoned construction of the V.C. Summer nuclear-power plant near Jenkinsville, S.C., last year. The site in September 2016.
0
2000
’10
Note: Figure for 2017 is through Sept. 30
Source: Inside Mortgage Finance
tions LLC, the scoring firm that
Experian, Equifax and TransUnion launched in 2006, says it
can step in.
The company says it can assign a credit score to about 30
million more consumers than
FICO. Roughly 7.6 million of
those consumers would potentially be eligible for a Fannie or
Freddie mortgage, VantageScore says.
The banks’ trade group, the
American Bankers Association,
says the current system allows
for strong underwriting standards. Introducing a new scoring model could put that at
risk, said Joe Pigg, senior vice
president of mortgage finance
at the ABA.
Nonbank lenders say the
current system is too rigid.
Sanjiv Das, CEO of a big nonbank lender, Caliber Home
Loans Inc., said VantageScore
could open up homeownership
to customers including millennials who don’t have a credit
history because of their age.
NOTICE TO THE HOLDERS (THE "NOTEHOLDERS") OF THE
U.S.$500,000,000, 7.875% NOTES DUE 2021, SERIES NO. 1, ISSUED BY
PAN AMERICAN ENERGY LLC, ARGENTINE BRANCH (THE "ISSUER")
AND GUARANTEED BY PAN AMERICAN ENERGY LLC, UNDER ITS
US$1,200,000,000 GLOBAL NOTE PROGRAM (CUSIP RULE 144A 69783T
AA2; CUSIP REGULATION S 69783U AA9 AND ISIN RULE 144A
US69783TAA25; ISIN REGULATION S US69783UAA97) (THE "NOTES")
In accordance with the General Provisions Applicable to the Notes, 33. Other terms
or special conditions, (i) Condition 6: Redemption and Purchase, (e) Change of Control
Put, of the relevant Pricing Supplement of the Notes, dated April 30, 2010, notice is
hereby given that the a Change of Control has occurred on December 16, 2017, and that
each such Holder has the right to request the redemption of all or a portion of such
Holder´s Notes by payment of the Change of Control Payment, as per the material fact
disclosed by the Issuer, copied below:
MATERIAL FACT
Closing of the Transaction
On September 11, 2017, it was announced to the public that BP plc (BP) had agreed
with Bridas Corporation (Bridas) to form a new integrated energy company by
combining their interests in the oil and gas producer Pan American Energy (PAE) and
the refiner and marketer Axion Energy (Axion). The shareholdings of both companies
would be contributed to a new company, Pan American Energy Group S.L. (PAEG),
owned equally by BP and Bridas, that would become the largest privately-owned
integrated energy company operating in Argentina.
Effectively, on December 16, 2017 the transaction was closed and as a result Pan
American Energy LLC is now indirectly owned 50% by BP and 50% by Bridas.
As a consequence, Noteholders have the option of redeeming their Notes on the
following terms:
Change of Control Date: December 16, 2017
Redemption Date/Payment Date: February 26, 2018
Redemption Price: 101% of the outstanding principal amount thereof
plus accrued and unpaid interest, if any, thereon to the date of redemption
Notice Period: from January 11, 2018 to January 26, 2018, which notice
shall be irrevocable.
To exercise such option, a Noteholder must deposit such Note with the Paying
Agent, together with a duly completed option exercise notice in the form obtainable
from the Paying Agent within the Notice Period.
No Note deposited and option exercised may be for less than the Specified
Denomination of U.S.$2,000 and integral multiples of U.S.$1,000 in excess thereof.
SCANA
Continued from the prior page
project builder Westinghouse
Electric Co. Since then, Scana
has faced questions from local
and federal officials.
The South Carolina plant
and a similar project in Georgia were both begun about a
decade ago. But both projects
encountered massive cost
overruns, which the utilities
blamed on Westinghouse as
well as contractors. Westinghouse parent Toshiba Corp.
entered into settlement deals
to pay utilities fixed sums and
cap its liabilities.
The Georgia project, an expansion of the Alvin W. Vogtle
Electric Generating Plant being spearheaded by Southern
Co., is still proceeding despite
FEES
Continued from the prior page
corporate bonds, meaning that
for a $1 billion bond issue,
companies would pay about $7
million to banks arranging the
sale. For U.S. high-yield, or
junk, bonds, the fee averages
1.2 percentage points, according to data from Thomson
Reuters.
Fees in Asia are generally
lower and can vary widely,
bankers say. Chinese banks, including state-owned Bank of
China Ltd. and Industrial &
Commercial Bank of China
Ltd., paid a 0.1 percentage
point fee on recent bond sales,
according to a person familiar
with the matter. Some companies are more generous. Alibaba Group Holding Ltd. paid
$33 million in fees—or about
0.47 percentage point—on a $7
billion investment-grade bond
deal in November.
Some bankers who recently
handled bond sales for Chinese
companies said they have
earned nothing from the deals
in some instances.
“We don’t like to do that,
but competition forces us to
costs that have ballooned to as
much as $25 billion.
Scana, based in Cayce, S.C.,
had collected more than $1 billion from customers to finance
construction of its plant. It was
seeking to pass on additional
construction costs, which
would have raised local power
bills considerably.
Facing rising pressure from
state regulators and consumer
groups, Scana last year said it
would roll back rates for its
South Carolina utility customers.
South Carolina Gov. Henry
McMaster called the proposed
merger a step forward, but
noted that it addressed only
some of the political ramifications from the failed power
plant, which also involved
state-owned utility Santee
Cooper. Scana owned 55% of
the Summer nuclear plant.
be on some deals no matter
what,” said a Hong Kongbased banker for a Chinese
bank, calling some of the fee
practices “irrational.” He declined to name specific issuers.
Another factor contributing
to lower fees: the rising number of banks participating on
bond offerings. The average
number of bookrunners on
Chinese companies’ U.S.-dollar
bond deals rose to 6.5 last
year, from 3.6 in 2012, according to Dealogic. The average
for Asia excluding Japan was
recently 4.6, versus 2.2 in the
U.S.
Larger bond syndicates
mean lower fees per deal are
also being divided among more
banks, making it harder for individual firms to profit, said
Florian Schmidt, a former investment banker who now
runs a consulting firm in Singapore.
Across Asia excluding
Japan, nearly 170 banks or
brokerages were involved in
arranging U.S.-dollar bond
sales for issuers in the region
in 2017, more than triple the
number five years earlier, according to Thomson Reuters.
Most of the newcomers were
local financial companies and
Santee Cooper owned the rest.
“We are making progress.
Under the proposed agreement between Scana and Dominion Energy, SCE&G ratepayers will get most of the
money back they paid for the
nuclear reactors and will no
longer face paying billions for
this nuclear collapse,” said Mr.
McMaster, a Republican.
Dominion said Wednesday
that it wouldn’t pursue the
merger if South Carolina lawmakers or regulators reject
the proposed terms.
The companies said South
Carolina Electric & Gas residential customers will get a 5%
rate reduction, equal to about
$7 a month for the typical customer. That compares with the
3.5% reduction proposed to appease regulators and frustrated customers last year.
Part of these lower rates
Joining the Party
Number of bookrunners
arranging U.S. dollar bond deals
Asia*
200 banks
U.S.
150
100
50
0
2012 ’13
’14
’15
’16
’17
*Excludes Japan
Source: Thomson Reuters
THE WALL STREET JOURNAL.
included dozens of Chinese securities firms.
When China sold $2 billion
in U.S.-dollar sovereign bonds
in late October, it tapped 10 investment banks to handle the
global sale to investors in
Asia, Europe and the Americas.
The country paid the banks,
which included Chinese, U.S.
and European banks, a total
fee of $2 million, or 0.1 percentage point. That suggests
will come from savings due to
the corporate tax cut in the recently enacted federal tax
overhaul, Dominion said, adding that it would write off
about $1.7 billion of nuclearrelated assets, lowering the
amount that ratepayers would
need to shoulder.
Dominion said the deal, expected to close this year,
would immediately boost
earnings. The purchase helps
Dominion extend its reach in
the eastern U.S. to where customer growth was faster than
in its Virginia and North Carolina territory.
Dominion said it would take
on about $6.93 billion in Scana
debt.
—Valerie Bauerlein
contributed to this article.
Heard: Utility bid is a deal
maker’s delight....................... B14
each bank earned $200,000 on
the sale.
Another reason many banks
will swallow low fees is to
move up the “league tables,”
which rank banks based on
deal volumes. They are followed closely and touted by
many banks, and those that do
the most business tend to be
more sought after by corporate clients.
“The pressure to be higher
up on the league table rankings becomes so much that investment banks start undercutting themselves by quoting
absurdly low fees,” said
Dharmesh Ojha, a former investment banker who is now
chief investment officer of ITI
Reinsurance in Mumbai.
In India, at least one of the
three state-owned corporations that recently paid banks
$1 to underwrite their bond
deals said there was no reason
to pay more, because banks
were eager to win the business. The companies—Indian
Railway Finance Corp., Rural
Electrification Corp. and
Power Finance Corp.—each
issued hundreds of millions of
dollars worth of bonds.
—Julie Wernau and Yifan Xie
contributed to this article.
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | B3
BUSINESS NEWS
Spotify AB has confidentially filed paperwork with the
Securities and Exchange Commission to list its shares on
the New York Stock Exchange,
according to a person familiar
with the listing.
This SEC filing is the latest
key step in Spotify’s plans to
go public using an unusual
method known as a direct listing. That listing won’t be an
initial public offering, as Spotify won’t seek to raise money
as it goes public.
Spotify’s most recent valuation was nearly $20 billion,
based on a recent share swap
between Spotify and Chinese
internet giant Tencent Holdings Ltd. While it is unclear
how public investors will value
Spotify, a $20 billion valuation
would make Spotify one of the
largest technology companies
to launch on a U.S. exchange
since Facebook Inc. Spotify
was valued at $8.5 billion during a private capital injection
in 2015.
The Swedish company has
been targeting March or April
for its debut, according to
people familiar with the matter.
If the debut goes well, it
could encourage other highly
valued and cash-rich startups,
such as Airbnb Inc., to pursue
direct listings, people familiar
with the matter have said.
Late last year, Spotify received approval from the SEC
to move forward with a direct
listing on the NYSE. The SEC
had concerns that Spotify’s direct listing could open the
door for other companies with
potentially risky financial profiles to access the public markets without giving investors
sufficient protection, people
familiar with the negotiations
said.
Axios reported earlier
$20B
Online music service Spotify’s
most recent valuation
Wednesday that Spotify had
filed confidentially with the
SEC.
Launched in 2008, Spotify
lets users listen to a library of
more than 30 million songs on
demand. Subscribers who pay
around $10 a month can listen
without hearing ads; users of
the free version need to sit
through ads and have more
limited ability to pick the order in which they hear the
songs they select.
As of June, Spotify said it
has 140 million active users
world-wide, 60 million of
whom pay.
The music industry has
widely credited Spotify and
other subscription-streaming
companies with helping to reverse a long slide in revenue.
The three global music companies—Vivendi SA’s Universal
Music Group, Sony Corp.’s
Sony Music Entertainment and
Access Industries Inc.’s Warner Music Group—received equity stakes in Spotify as part
of deals to license their catalogs to the Sweden-based
company.
Spotify has reported limited
financial results, which have
shown losses for several years
running.
In a direct listing, a company transfers its shares to an
exchange without raising
money as is done in a typical
IPO. Companies have shied
away from the unusual process
in part because there is a
greater risk that the shares
could flop since there are no
underwriters to set and prop
up the price.
The listing is being used as
a way for Spotify to give existing investors the chance to
cash out but not to raise additional funds. New investors
will be able to buy shares once
they start trading.
Spotify has been hit recently by a raft of copyrightinfringement lawsuits filed by
songwriters and music publishers, though a person familiar with the matter said the
suits won’t affect the timing of
Spotify going public.
Some big investors and
banks are reviewing their bets
on an oil-and-gas industry
now wrestling with uncertain
oil demand, government regulation and disruptive technolBy Sarah Kent in
London and Nina
Adam in Oslo
ogy like electric vehicles.
The biggest decision will
come in Norway, where the
government says it will decide
this year whether to wind
down investments by its $1
trillion sovereign-wealth fund
in the oil-and-gas sector. Its
assets include multibillion-dollar stakes in Exxon Mobil
Corp., Royal Dutch Shell PLC,
Chevron Corp. and BP PLC.
Other investors, including
French insurance giant AXA
Group and Dutch bank ING
Groep NV, are pulling back
from parts of the industry that
contribute most to climate
change, like Canada’s oil
sands. In a world where the
heaviest-polluting industries
could be penalized, some investors say the financial risks
of such investments could outweigh the rewards. For instance, Canada is introducing
a carbon tax this year to limit
greenhouse-gas
emissions
from oil sands.
The moves are distinct from
calls by environmentalists and
so-called ethical investors for
divestment from the oil industry, although those sentiments
have been taken up by large,
mainstream financial institutions more often since the
2015 Paris agreement to fight
climate change. The World
Bank said last month it will
stop financing oil and gas exploration and drilling by 2019,
in support of the Paris goals.
French bank BNP Paribas says
it will no longer finance some
oil projects seen as environmentally damaging.
Renewable energy, once
hampered by high costs, has
become cheap enough to compete with coal and gas in some
instances. The U.K., France,
China and India have signaled
they plan to eventually ban
sales of vehicles with traditional combustion engines.
Norwegian officials say the
current debate is entirely
pragmatic. The country may
ANDREY RUDAKOV/BLOOMBERG NEWS
BY MAUREEN FARRELL
AND ANNE STEELE
Norway, Others Rethink Oil Bets
Processing crude oil at a Tatneft facility in Russia. Investors are focusing more on the industry’s record on global warming.
be overexposed to a sector undergoing turbulent change by
having both a large national
oil company, Statoil ASA, and
billion-dollar-plus holdings in
other oil companies.
“This is really a question of
risk diversification,” Yngve
Slyngstad, chief executive of
Norges Bank Investment Management said in an interview.
NBIM manages the country’s
investment fund, which receives Statoil’s profits and
other energy-focused revenue
in Norway for investment elsewhere.
Mr. Slyngstad said the transition from dependency on
fossil fuels to alternatives
would take several decades.
But he said investments in traditional oil companies should
come with a “high-risk premium,” considering “all the
uncertainty around the energy
transition.”
The Norwegian concerns
have “put those industries on
alert,“ said Matt Christensen,
global head of responsible investment at AXA’s asset-management arm. ”The risks
which climate change presents
are becoming more understood as existential in nature.”
Energy Exposure
Norway is considering reducing the stakes
it holds in big oil companies.
Norway Sovereign Wealth Fund, 2017
Assets under management $1 trillion
Holdings in oil and gas equities $40 billion
Norway fund's big oil holdings*
Shell
$3.7 billion
BP
3.0
Exxon Mobil
2.8
Chevron
2.2
Total
2.2
*Latest available data
Sources: Norges Bank Investment Management (fund value);
THE WALL STREET JOURNAL.
S&P Global Market Intelligence (oil and gas stocks)
To be sure, wholesale divestment from the oil-and-gas
sector remains rare. The sheer
size of oil giants make it difficult for fund managers to exclude them outright.
BP Chief Executive Bob
Dudley said Norwegian officials had been “pretty clear
with me” that their concerns
weren’t about climate but
about diversification. “I can’t
argue with that really,” he
said.
Norway’s oil fund owns
over 2% of BP’s stock, according to S&P Global Market Intelligence. Any Norwegian oil
divestment is likely to be carefully managed and take place
over a number of years so as
not to disrupt markets.
U.S. investors appear committed to the oil industry but
have begun pressuring it to
change. Last year, a task force,
commissioned by the G-20 and
including major financial institutions like JPMorgan Chase
& Co. and BlackRock Inc., published guidelines pushing for
better disclosure of the impact
of climate change. Across the
U.S., utilities and oil-and-gas
companies faced shareholder
revolts as investors clamored
for more information about
how they view climate risk.
“We think we can have
more influence from inside the
tent,” said Rob Main, who sits
on the investment stewardship
team of Vanguard Group,
which holds $4.9 trillion under
management. Last summer, it
voted against the boards at
Exxon and Occidental Petroleum, demanding more disclosure of business risks related
to global warming.
Tesla’s Model 3 Sales Fall Far Short of Goal
BY TIM HIGGINS
Tesla Inc. underwhelmed
Wall Street with sales of its
new Model 3 sedans in the
fourth quarter, raising questions about whether the Silicon Valley luxury electric-car
company can spark production this year and transform
itself into a mainstream auto
maker.
The company on Wednesday said it sold 1,550 Model 3s
in the final three months of
the year, badly missing Wall
Street’s already lowered expectations. Tesla again pushed
back its goal of making 5,000
Model 3s a week by a quarter,
now targeting that rate by the
end of the year’s first half.
The Model 3, which began
production six months ago and
starts at $35,000, is Tesla’s
first shot at producing an
electric car for the masses.
Chief Executive Elon Musk
has proved doubters wrong
before, creating a luxury brand
with a devoted following that
can compete for buyers
against BMW and MercedesBenz. But Tesla has never produced cars on a large scale; it
aims to build a half-million
cars a year—about five times
more than last year’s total.
The company has blamed
“production bottlenecks” for
producing a fraction of its
promised Model 3s in the past
two quarters. Tesla said
Wednesday it made “major
progress” fixing its problems
and amped up its production
rate toward the end of the
year. In the final seven working days of December, Tesla
said it made 793 Model 3s.
Soon after the report on
fourth-quarter sales, Tesla’s
stock fell more than 2% in after-hours trading to $310.77.
Tesla’s continued production struggles with the Model
3 overshadowed a milestone
reached in 2017, when it sold
more than 100,000 Model S
sedans and Model X sport-utility vehicles for the year, a 33%
increase from a year earlier.
Tesla’s overall global sales
Time Inc. Sells Essence Title
BY JEFFREY A. TRACHTENBERG
Time Inc. has sold Essence,
the monthly African-American
women’s lifestyle magazine,
for an undisclosed sum to Essence Ventures LLC, a company formed in 2017 by Sundial
Brands
co-founder
Richelieu Dennis.
Essence has been on the
block since July, when Time
Inc. said it intended to sell a
majority stake in the brand as
part of an effort to slim down
its portfolio.
Time Inc. then reached a
deal in November to be acquired by Meredith Corp. for
$1.85 billion, and decided to
proceed with selling all of Essence separately.
“Richelieu has distinguished
himself as one of the country’s
most prominent African-American leaders and investors, who
embodies enthusiasm and excitement for Essence that will
foster its growth into the future,” said Rich Battista, Time
Inc.’s chief executive, in a
memo to staffers Wednesday.
Mr. Battista commended the
Essence team on extending the
brand’s reach across platforms.
Mr. Dennis, who was born
growth exceeded researcher
LMC Automotive’s forecast of
a 2.5% rise for the global automotive industry last year.
Tesla is also bucking the trend
in the U.S., where sales fell for
the first time in eight years,
punctuated by a 5.2% decline
in December.
The company’s early success with the high-end Model
S sedan and its ability to create a desirable luxury brand
have fueled investor enthusiasm for Mr. Musk’s vision of
personal transportation. He is
hoping to rid the world of
combustion engines and fill
the streets with electric cars
that drive themselves.
But Tesla first has to mass-
produce the Model 3.
Tesla was expected to sell
4,100 Model 3s during the
fourth quarter, according to
the average estimate of seven
analysts surveyed by FactSet.
That consensus had dropped
from more than 18,000 when
the analysts were surveyed in
August before signs of trouble
began brewing.
While Mr. Musk had warned
of “manufacturing hell” in July
when the company celebrated
the start of Model 3 production, he still promised to make
20,000 of the new vehicles in
the month of December, a figure later pared back to reaching a rate of 5,000 a week by
the end of the fourth quarter.
We are pleased to announce that
Anthony A. Yoseloff
has been appointed
Co-Executive Managing Member of our firm.
ISTOCK PUBLISHED CREDIT: ISTOCK
Spotify
Registers
For NYSE
Listing
1 New Burlington Place
London W1S 2HR
31 Queen’s Road Central
Central, Hong Kong
47-49 St. Stephen’s Green
Dublin D02 W634
January 1, 2018
We are pleased to announce that
The buyer is a company formed by the co-founder of Sundial Brands.
in Liberia and came to the U.S.
for college, was a co-founder
of Sundial Brands, a hair-care
and skin-care company with
brands like SheaMoisture and
Nubian Heritage. Unilever
agreed to acquire the company
in November, with Mr. Dennis
remaining as the business’s
CEO and executive chairman.
Mr. Dennis couldn’t be
reached for comment.
Essence Ventures said in a
press release that Essence, in
addition to boosting its international presence, will “focus
520 Madison Avenue
New York, NY 10022
on expanding its digital businesses via distribution partnerships, compelling original
content and targeted clientfirst strategies.”
Michelle Ebanks, president
of Essence Communications
Inc., whose principal asset is
the Essence brand, will stay
with the company and join the
board of Essence Ventures.
She will also have an equity
stake in Essence Ventures.
Time Inc. is also expected
to sell its U.K. publishing
group and Golf magazine.
Zachary Altschuler
Jamie Michaelson
Josh Morris
have been appointed Partners of our firm.
520 Madison Avenue
New York, NY 10022
1 New Burlington Place
London W1S 2HR
31 Queen’s Road Central
Central, Hong Kong
47-49 St. Stephen’s Green
Dublin D02 W634
January 1, 2018
.
THE WALL STREET JOURNAL.
B4 | Thursday, January 4, 2018
TECHNOLOGY
WSJ.com/Tech
Verizon Taps Samsung for 5G Initiative
Korean company will
supply equipment for
high-speed internet
on wireless network
Verizon Communications
Inc. chose Samsung Electronics Co. as a major supplier in
the telecom giant’s push to offer high-speed internet over
its wireless network, as the
first commercial offerings of
fifth-generation systems take
shape.
Verizon’s 5G network will
launch in the second half of
this year in Sacramento, Calif.,
before the service expands to
other U.S. markets. It will use
cellular antennas to beam
high-speed internet into consumers’ homes. Samsung will
make network equipment for
Verizon, including the small
boxes located in each home for
receiving the system’s signal
and translating it into Wi-Fi.
Financial terms of the arrangement weren’t disclosed
in the companies’ announcement Wednesday.
Telecom giant Verizon last
year began free 5G trials, focused on home broadband
service, in 11 markets from
New Jersey to California.
Samsung will provide network gear for Verizon’s
launch in Sacramento, where
customers will be offered the
option of purchasing the
faster service.
YONHAP/EPA/SHUTTERSTOCK
By Timothy W. Martin
in Seoul and Ryan
Knutson in New York
So-called fifth-generation wireless technology is slowly unfolding. The 5G Village opens for the 2018 Winter Olympics in South Korea.
The wireless home internet
service is different from Verizon’s existing wired service,
called Fios, which is offered
primarily in the Northeast.
Similarly, the service—and 5G
in general—isn’t yet available
for mobile-phone users.
Companies globally are investing billions of dollars in
5G despite continued debate
over its ultimate utility beyond faster download speeds.
Government agencies and
telecom operators expect 5G
availability in many markets
by 2020, and with it the potential for broader adoption of
self driving cars, smart cities
and internet-connected robots.
“5G is a reality,” Kim
Young-ky, president of Samsung’s networks business, said
in an interview.
Introducing 5G service for
homes is an early step in the
industry’s transition to the
technology, which will be significantly faster and respond
more quickly to user commands than existing 4G networks.
For Verizon, it carries the
potential to disrupt an industry currently dominated in the
U.S. by cable providers like
Comcast Corp. and Charter
Communications Inc. Verizon
said last month it would also
be supplied by Ericsson AB,
another 5G network equipment maker, for commercial
launches in other U.S. markets.
Samsung is a small player
in the network equipment
world, but the South Korean
technology giant believes its
expertise in making products
and components could give it
an edge with telecom customers looking to sell connectivity
to a wider range of devices.
Samsung’s network business generated some 2 trillion
won to 2.5 trillion won ($1.9
billion to $2.3 billion) in revenue last year, according to research firm Counterpoint
Technology Market Research.
It targets annual revenue of 10
trillion won by 2022, a Samsung spokesman said.
AT&T Inc. last month said it
would launch a 5G commercial
trial site in Texas, after tests
in other markets. Sprint Corp.
and T-Mobile US Inc. have said
they are working on nationwide 5G networks, targeting
late 2019 or 2020.
The average U.S. consumer
uses about five gigabytes of
mobile data a month, Mr. Kim
said. But as 5G spreads, he believes consumers will eventually use closer to 100 gigabytes monthly on new services
such as virtual or augmented
reality programs—or even for
autonomous driving that will
require greater data speeds to
rapidly process traffic conditions.
About two years ago, Samsung combined about 1,000
workers from different divisions including handsets, network and its central researchand-development group, to
create a “Next Generation
Communications Business”
team dedicated to 5G.
“With 5G, it’s going to be
expanding
beyond
your
phone,” Kim Woo-june, a senior vice president in Samsung’s network business, said
in an interview. The industry’s
first mobile phones with 5G
capabilities aren’t likely to debut until 2019, he added.
When the Cloud Isn’t Fast Enough
ADVERTISEMENT
Franchising
To advertise: 800-366-3975 or WSJ.com/classifieds
FRANCHISE OPPORTUNITIES
BY SARA CASTELLANOS
Millions of machines and
objects are connecting to the
internet for the first time,
challenging an architecture
that was designed during the
past few decades with people
in mind. As a result, companies are putting more computing resources at the edge of
the network, in vehicles, elevators and factory machines.
“There are certain applications and use cases where you
need to have real-time machine
intelligence. You cannot wait for
the cloud,” said Michael Nilles,
chief digital officer of elevator
maker Schindler Group.
Startups and companies such
as Microsoft Corp. and General
Electric Co. are rushing into the
market for edge products and
services, which are expected to
grow to $6.7 billion by 2022,
from about $1.5 billion in 2017,
according to research firm MarketsandMarkets.
In this new arrangement, data
is processed and analyzed on or
near the device where it is generated instead of first being sent to
a corporate cloud or data center.
Devices can analyze data in real
time without always relying on
connectivity to a corporate cloud.
The number of devices connected to the internet is surging,
and will reach 20.4 billion by
2020, up from 8.4 billion in 2017,
according to Gartner Research
Inc. By 2021, 40% of enterprises
will have an edge-computing
strategy in place, up from about
1% in 2017, Gartner said.
The self-driving car illustrates
the need for edge computing. It
must make life-or-death decisions in real time. Some of these
computations will be done on
the car itself rather than waiting
for data to travel to a cloud and
back, or worse, risking a loss in
connectivity to the cloud.
It typically takes 150 to 200
milliseconds for data to travel
from where it is generated to a
cloud provider and back, said
Don Duet, president and chief
operating officer of Vapor IO,
a startup working with mobile
infrastructure providers to
build and deploy edge servers
at cell towers.
Placing servers closer to de-
vices could shorten that time to
2 to 5 milliseconds, significantly
improving performance for critical applications in areas such
as health care, connected cars
and smart cities, he said.
At Schindler, sensors in elevators detect data ranging
from temperature to energy
consumption and the open and
close cycles of doors, Mr. Nilles
said. That data is streamed to
an edge device near the elevator, where machine-learning algorithms detect anomalies.
If the algorithm detects that
a component is about to fail, it
will trigger a notification to be
sent over the cloud to a maintenance worker, so the problem is fixed days before an actual failure occurs.
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Continued from page B1
gles are swiping—looking at
people’s profile pictures to determine, in about a nanosecond, whether they would like
to message them, meet them
and potentially have babies
with them.
I’ve swiped so much using
six different apps over the
past three weeks, I got a callus. And though I’ve been on
and off a variety of dating
apps for five years, my binge
helped me understand what is
actually getting better, and
what still needs work. At this
stage, it would take an act of
God for people to start meeting in person again, so here
are my tips and takeaways to
make the app ordeal more
bearable.
When I first heard apps
were experimenting with
video features, I recoiled in
horror. In November, Coffee
Meets Bagel started letting
people film an answer to a set
question, then post it for others to see. I saw lots of men
post messages recorded from
the comfort of their cars... or
beds.
Dawoon Kang, Coffee
Meets Bagel’s co-founder, says
users who add video are seen
by five times as many people
in their area. Increased visibility sounds good, just keep it
classy.
I surprised myself by liking
a video feature on Hinge. Users can post video from their
Instagram feed and add it to
their profile. I’m proud to say
at least 10 guys have found
my tone-deaf karaoke-bar performance of Heart’s “Alone”
endearing.
There are few safeguards
against seeing Facebook
friends or co-workers show up
in dating apps. Even worse:
When my brother and I are in
the same city, he shows up on
Several apps include video features. Coffee Meets Bagel lets people film answers to set questions.
my feed of eligible men.
Sarah Jones Simmer, Bumble’s chief operating officer,
says these are complex problems—some people might
want to see Facebook friends
on dating apps. Still, the issues are on Bumble’s radar.
T
he League, a semi-exclusive service launched
in late 2014, always
hides your Facebook friends
and LinkedIn connections. It
also is testing a way to block
someone by email address.
Tinder, part of Match
Group Inc., hasn’t been my favorite for years, but I like its
Smart Photo feature. It can alternate the picture of you that
shows up first and tell you
which photo gets right-swiped
the most.
Even if you don’t like Tinder, you can put up pictures
to see which does best, then
use that as your lead pic on
other apps.
Texting is how people communicate, and dating apps are
no exception; so this is the
kind of rogue advice that
could invite hate mail: Pick up
the phone.
The first time a guy from
an app asked if he could call
me, I felt like he had asked to
give me an infectious disease.
But after 10 minutes on the
phone, I knew I didn’t want to
meet him. When another guy
called, we talked for an hour.
And you know what? It was
nice. There, I said it.
Everyone loves Bumble, except me. Its distinguishing
feature is that, when a man
and a woman match, the
woman has to message first.
It supposedly is empowering,
and cuts down on unwanted
messages. (With same-sex
matches, either party can
message first.)
I hate making the first
move. But the majority of my
single friends in their 30s,
both male and female, use
Bumble. Folks who are a decade younger also say it is
their app of choice. At last
count, the app had 25 million
downloads.
While I may not like Bumble’s premise, I’ve tended to
like the guys I’ve met on the
app more than via others. And
Ms. Jones Simmer says that
women will always message
first, but forthcoming features
will help “remove the friction”
for people like me.
Experiences on apps tend
to change over time, and your
feed can start feeling like a
graveyard of people you’ve already swiped past, so it is
good to have a second app.
My most-improved award
goes to Hinge. Its initial premise was matching you with
people connected to your
Facebook friends. I rarely
matched and eventually deleted it. But since Hinge’s
late-2016 revamp, it has become a more social place of
its own: Even before matching, users can like or comment on aspects of one another’s profiles.
W
hen my friends and I
were younger, if cute
guys kept streaming
into a bar, we would use the
phrase “head on a swivel”—
too many directions to look.
With dating apps, everybody’s head seems to be on a
swivel, making it hard to settle down. It is dating’s FOMO:
fear of missing out on someone better, because you
stopped swiping.
While these apps can be
soul crushing, they might help
you find someone who makes
you happy. Here is the key: If
and when that happens, delete
the apps. Don’t let the cheap
thrill of the swipe spoil a potentially genuine relationship.
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | B5
Dear Business Leaders,
Our people count on us to care about their health and wellness.
Americans now spend $3.4 trillion on healthcare each year1, with 75% of the cost
spent on chronic diseases connected to lack of exercise, poor nutrition and stress2.
These factors are preventable and can be directly addressed with wellness activities.
Americans want to do better. They want to feel better. And they want to live better.
Time and access are the two major barriers that stand in their way, and as CEOs and
business owners, it’s our responsibility and duty to remove them.
At MINDBODY, our purpose is to help people lead healthier, happier lives by
connecting the world to wellness.
In ten years, we envision 120 million Americans engaged in wellness activities.
That’s more than twice the number engaged today.
Together, let’s double down on employee wellness by investing more in our
wellness programs.
Our people’s health depends on it—and it’s the right thing to do.
Join us in connecting Americans to wellness and help us make this vision a reality.
Please share your support and commitment to investing in employee wellness by
tweeting with the hashtag #MakeAmericaWell.
To connect with other companies who are doing the same,
visit mindbodyonline.com/Make-America-Well
Cheers to 2018,
Rick Stollmeyer
CEO & Co-founder
MINDBODY
1
CMS.gov
2
CDC.gov
.
THE WALL STREET JOURNAL.
B6 | Thursday, January 4, 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 inluential business leaders, policy makers and experts
from across the health and health-care industries to focus on the innovations transforming this critical sector of the
economy. These participants will join an audience of senior executives and entrepreneurs, including those from the
worlds of inance, science and regulation.
Through highly interactive interviews, the editors will cover issues of key importance in 2018, from the technologies
and advanced analytics changing the study of the human genome to new business models affecting health care.
SPEAKERS
George M. Church, Ph.D.
Professor of Genetics,
Harvard Medical School
Director,
PersonalGenomes.org
Stephanie Domas, P.E.,
C.E.H.
Lead Security Engineer,
Battelle
Rear Adm. Anne Schuchat,
M.D.
Principal Deputy Director,
Centers for Disease Control
and Prevention
Eric Topol, M.D.
Founder and Director,
Scripps Translational
Science Institute, Professor
of Molecular Medicine and
Executive Vice President,
The Scripps Research Institute
Anthony S. Fauci, M.D.
Sarah E. Wakeman, M.D.
Director, National Institute of
Allergy and Infectious Diseases,
The National Institutes of Health
Medical Director, Substance
Use Disorders Initiative,
Massachusetts General Hospital
Assistant Professor of Medicine,
Harvard Medical School
Richard J. Gilillan, M.D
Feng Zhang, Ph.D.
CEO,
Trinity Health
Core Institute Member,
Broad Institute of MIT
and Harvard
Thomas McLellan, Ph.D.
Daphne Zohar
Co-Founder and Scientiic Director
(19922015),
Treatment Research Institute
Co-Founder and CEO,
PureTech Health plc.
Deputy Director and Senior Scientist
(20092011),
White House Ofice of National Drug
Control Policy
David N. Osser, M.D.
Associate Professor of Psychiatry,
Harvard Medical School
Attending Psychiatrist, Domiciliary
Treatment Program for
Homeless Veterans,
Veterans Affairs Boston
Healthcare System
Request your invitation: healthforum.wsj.com
© 2018 Dow Jones & Co., Inc. All rights reserved. 6DJ6233
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | B7
NY
MANAGEMENT
CEOs Gird for a Year of Disruption
Cybersecurity risks,
emerging technologies
and talent battles add
to pressure on leaders
CEO Exits
More chief executives resigned,
retired or got fired in 2017 than
at any time in at least a decade.
1,000.CEOs
BY JOANN S. LUBLIN
AND VANESSA FUHRMANS
500
250
0
2008 ’10
’12
’14
’16
Note: Based on corporate filings from more
than 4,000 publicly traded North American
companies.
Source: Liberum Research
THE WALL STREET JOURNAL.
RYAN GARCIA
Corporate leaders see cybersecurity threats, disruptive
technologies and stiffer competition for talent as some of
their most pressing issues in
the new year, according to interviews with nearly a dozen
chief executives.
“I don’t think there’s any
such thing as an easy year for
CEOs anymore,” said Jim
Loree, who just completed his
first full year in the top job at
Stanley Black & Decker Inc.
The growing pressures coincide with a changing of the
guard in the corner office, creating one of the largest legions of new leaders in years
to tackle those tough tasks.
Last year, 919 CEOs resigned, retired or were fired at
publicly traded North American companies, the most in at
least a decade, according to
Liberum Research.
The feverish pace of turnover claimed some of the biggest names at U.S. corporations, including the leaders of
Equifax Inc., General Electric
Co., Ford Motor Co., Caterpillar Inc., Arconic Inc., Macy’s
Inc. and Mondelez International Inc. And on Dec. 31,
Papa John’s International
Inc. founder John Schnatter
stepped down as CEO.
Departures of company
chiefs continue in the new
year. On Tuesday, Rent-A-Center Inc. said founder Mark
Speese had stepped down
from its top spot.
Under increased investor
pressure, directors are making
broad demands of their chiefs,
some leadership specialists
say. “The expectations that
boards have of CEOs is that
they can do everything,” said
Hugh Shields, co-founder and
principal at Shields Meneley
Partners LLC, a career-transi-
750
tion and leadership-coaching
firm for senior executives. “In
some cases, they are looking
for a unicorn.”
The threat of data breaches
poses a critical risk, said Mr.
Loree and several other chief
executives. “These bad actors
keep getting smarter and more
aggressive,” Mr. Loree said.
“It’s an ongoing war.”
Stanley Black & Decker,
which makes power and hand
tools, recruited Mark Maybury
as its first chief technology officer in November. He is a cybersecurity specialist with a
doctoral degree in artificial intelligence. Dr. Maybury’s duties include overseeing cybersecurity, Mr. Loree said.
About 64% of 1,031 humanresources professionals believe data security and the
threat of a cyberbreach will
become a very challenging or
extremely challenging issue in
2018, according to a survey by
XpertHR, an online provider of
compliance guidance.
Another challenge in the
new year will be anticipating
how emerging technologies
open new markets or upend
their industries, company
leaders say. Julio Portalatin,
president and CEO of Mercer
Consulting, a unit of professional-services firm Marsh &
McLennan Cos., said that high
on his priority list is guarding
against unforeseen, nimble rivals that could harness automation and artificial intelligence to poach customers in
niche markets. “It’s the [rivals] I don’t know about that
I’m concerned about,’’ he said.
To gird Mercer’s business
against such attacks, Mr. Portalatin said Mercer formed a
business this summer focused
on helping employers use data
analytics and other new technologies to recruit and manage employees and assist their
workforces in adapting to a
more digital economy.
New technologies are disrupting the war for top talent,
said Mike Cannon-Brookes, cofounder and co-CEO of Atlassian Corp., which has headquarters in Sydney and San
Francisco. The maker of workplace software tools no longer
solely competes with other
tech firms for staffers. In their
quest to build highly sophisticated technology platforms,
some financial-services companies now have more software engineers than bankers
and traders on their payrolls,
Mr. Cannon-Brookes said.
To fill more than 200 positions currently open at the
2,300-employee company, Atlassian is looking to hire people across four continents.
The imminent drop in U.S.
corporate tax rates might intensify political pressure on
chief executives to expand
their U.S. workforces, some
business leaders say.
Polaris Industries Inc., a
producer of snowmobiles, motorcycles and all-terrain vehicles, expects to hire nearly 100
engineers world-wide in 2018
and most will work in the U.S.,
said CEO Scott Wine. The
company already employs
nearly 900 U.S. engineers.
“With the additional money
from tax reform, we can invest
a bit more in our best [research] programs,” Mr. Wine
said. Those engineering projects typically generate a new
technology, engine or vehicle.
The Polaris chief expects to
spend about $260 million on
research and development this
year, compared with just under $240 million for 2017.
Despite widespread revelations of workplace misconduct
that toppled numerous powerful executives in 2017, most
CEOs don’t rank sexual harassment among their top concerns for 2018.
One exception is Anil
Chakravarthy, head of software maker Informatica LLC.
The recent scandals have
prompted “an extensive look
at our code of conduct [and]
what protections we have for
whistleblowers,” Mr. Chakravarthy said.
Sexual harassment “is not
an issue for us today,” he said.
“But I don’t want it to be.’’
WORKAROUND
These Employees
Rate Their Bosses
Twice Each Year
Companies track everything from worker productivity to inventory fluctuations. Yet relatively few
systematically measure the
relationship between employees and their managers.
As low unemployment
heightens pressure on companies to hang on to top talent,
one tech firm’s effort to do
just that highlights the difference a good boss can make.
Upon asking its 5,300 employees to rate supervisors
on more than a dozen metrics, workforce-management
software provider Kronos
Inc. found that managers’
scores were a strong indicator of how likely their direct
reports were to leave or stay
at the firm. As low-scoring
managers improved through
discussions with their teams
and individual coaching, so
did their subordinates’ desire
to stay, according to Kronos
employee survey data.
Unlike so-called 360-degree reviews—in which employees are rated by their
bosses, subordinates and selected peers—Kronos’s initiative zeroes in on managerial
behaviors the company identified as playing the biggest
role in motivating employees.
Twice a year, employees
at Lowell, Mass.-based Kronos are asked to rate their
bosses—for instance, on
whether they talked with
them about career development in the past six months.
In its initial July 2016 survey, Kronos found that
among employees whose
bosses scored in the bottom
25% of all managers, 73%
said they planned to still
work there in a year’s time,
compared with 94% of those
with bosses in the top 25%.
Experience at Kronos has
shown that people who respond negatively to the
question are five times as
likely as others to leave.
—Vanessa Fuhrmans
M.B.A. Is Cheaper Than You Think,
As Schools Beef Up Aid Packages
One of America’s priciest
graduate degrees is on sale.
Top business schools are
subsidizing the cost of twoyear master’s degrees in business adminisBUSINESS
tration
by
EDUCATION setting aside
millions
in
scholarships
and financial aid to lure young
professionals out of a
strengthening job market.
The advertised price for a
traditional M.B.A. can top
$200,000 at the most competitive schools in the U.S., but
some 61% of this year’s students are receiving scholarships
based on merit, financial need,
or a combination of the two, according to data from the Graduate Management Admission
Council, which administers the
standardized test commonly
taken by business-school applicants. That is up from 41% in
2014.
For the Harvard Business
School class of 2019, the average fellowship award cuts tuition to $35,000 from $72,000 a
year, according to a spokesman.
HBS administrators draw from
a pool of $32 million to help
more than half the M.B.A. program’s 900 students each year,
up from $15.5 million in 2009.
Dartmouth College’s Tuck
School of Business has roughly
doubled its scholarship budget to
$87.6 million since 2004, to help
draw students who might otherwise recoil from the degree’s
sticker price of $68,910 a year.
“There’s been a real focus
on eliminating financial considerations as a barrier for enrollment in recent years,” said
Luke Peña, Tuck’s director of
admissions and financial aid,
who joined the school from
the admissions office of Stanford University’s Graduate
School of Business last year.
Joky Kong, a first-year M.B.A.
student at University of Southern California’s Marshall School
of Business, said he had been
confident the program would reconsider its initial financial-aid
offer to him after he received a
generous scholarship from the
Tepper School of Business at
Carnegie Mellon University.
JASON HENRY FOR THE WALL STREET JOURNAL
BY KELSEY GEE
The advertised price for a traditional M.B.A. can top $200,000 at
the most competitive schools. A Stanford campus facility.
Marshall’s admissions officers matched Tepper’s offer,
and provided Mr. Kong an additional $5,000 a year in scholarships to sweeten the offer,
which Mr. Kong said he happily
accepted. “Once you receive an
offer—and especially if you
have multiple offers—you have
leverage,” the 28-year-old student said. In his study group of
six M.B.A. students, five received scholarships from the
school, Mr. Kong said.
Once considered a musthave for swift advancement in
fields like finance and consulting, enrollment in full-time
M.B.A. programs has fallen by
more than one-third since
2010, as wages for many workers have improved and
shorter, specialized degrees
have been introduced.
The discounts come as more
young workers are footing their
own M.B.A. tuition bills. Only
8% of students expected to receive employer support to pursue full-time M.B.A.s in 2017,
according to GMAC data.
Universities typically don’t
disclose how much aid they dole
out to graduate business students. But administrators, admissions consultants and industry
watchers
say
that
competition has encouraged
schools to beef up their war
chests with new scholarships
and fellowship packages, and to
be more aggressive in countering
offers made by other programs.
“We encourage all applicants to negotiate, across the
board,” said Michelle Clifton,
an adviser with EdAssist, a division of Bright Horizons Family Solutions Inc. and former
associate director of financial
aid at Babson College.
The flexibility of aid packages
has long been a topic of intrigue.
A security breach of confidential data at Stanford University last fall revealed 10
years’ of financial-aid decisions
at the M.B.A. program and
shed light on how the elite
school doles out scholarships.
Until November, the business
school’s financial-aid website
said that awards were based
solely on financial need, and
that the school didn’t give
merit-based fellowships. But an
analysis of the exposed data by
M.B.A. student Adam Allcock,
reviewed by The Wall Street
Journal, found that students
with nearly identical financial
situations receive “vastly different” fellowship awards, depending on factors like gender.
The dean of Stanford’s business school, Jonathan Levin,
said in a note to students and
staff in November that the
school offers “additional fellowship awards to candidates
whose biographies make them
particularly compelling and
competitive in trying to attract
a diverse class.”
BE AMBITIOUS
@HOFSTRA
Graduate business degree options at the
Frank G. Zarb School of Business include:
• Flex MBA programs
• Co-op MBA Program
• MBA in Manhattan
• Online MBA
• Hybrid Executive MBA
• Master of Science programs
(with various concentrations)
• Accelerated One-Year Hybrid MBA
v Attend one of our upcoming graduate events
to learn more:
Graduate Open House
Tuesday, January 9, 2018 | Check-in begins @ 6 p.m.
Frank G. Zarb School of Business Enrollment Night
Thursday, January 11, 2018 @ 6 p.m.
Register at hofstra.edu/wall
.
B8 | Thursday, January 4, 2018
THE WALL STREET JOURNAL.
* *
BUSINESS & FINANCE
BY SARAH KROUSE
AND KIRSTEN GRIND
The president of Fidelity
Investments’ equity division
is moving to a new role within
the fund giant’s personal investing business later this
quarter, leaving a post he has
held since 2009.
Brian Hogan most recently
led equity and high-income investing within the asset-management unit at Boston-based
Fidelity.
In his new role, he will be
head of investment solutions
and innovation within the
company’s personal-investing
unit, a Fidelity spokesman
confirmed.
The personal investing unit
The Fidelity division
faced scrutiny after a
firing and allegations
of sexual harassment.
houses Fidelity’s brokerage
platform, individual retirement accounts and other services for retail investors.
Mr. Hogan joined Fidelity in
1994 as a bond analyst. In
1998, he joined the stock-picking unit and has held a number of roles, including senior
vice president of equity research.
The equity division has
faced scrutiny in recent
months after The Wall
Street Journal reported on a
high-level firing there and
allegations of sexual harassment.
“The combination of the
firm’s focus on career vitality
and mobility, the recent departure of Bart Grenier to join Fidelity
International
and
Brian’s investment-product expertise and deep understanding of our customers makes
this the right decision for Fidelity,” the Fidelity spokesman
said.
In recent months the firm
has shifted some of its senior
executives to roles in other
business units.
Mr. Hogan will now report
to Kathleen Murphy, a deputy
of Fidelity Chief Abigail Johnson, who has run the personal
investing business for nearly a
decade.
Within that unit, he will
succeed Bart Grenier. Mr. Grenier is moving to London as
global head of asset management for Fidelity International.
Charles Morrison, president of Fidelity’s asset-management unit, is “evaluating
next steps for the leadership”
of the equity unit, the
spokesman said.
Fidelity, founded by the
Johnson family in 1946, has
long been known for the star
investors within its moneymanagement business that try
to beat the market. It manages
$2.43 trillion and has $6.7 trillion in assets under administration.
Fidelity’s equity unit in particular has been home to topperforming investors such as
Peter Lynch and William
Danoff.
The Journal reported in
October that Fidelity had
fired one of its star stock
pickers for allegedly sexually
harassing a junior female employee and that multiple employees had complained to
superiors and the company’s
human-resources department
about sexual harassment and
other abusive behavior by
portfolio managers in the equity unit.
Late last year Fidelity
hired a consulting firm to review employee behavior, including within the equity division.
Mr. Hogan held an emergency meeting to stress the
company’s “zero-tolerance policy” for inappropriate workplace conduct.
Since then, Ms. Johnson
moved her desk to the 11th
floor, where the equity division is based, and recorded a
video message for employees
that said “we have no tolerance at our company for any
type of harassment,” according to a transcript of the remarks. “We simply will not,
and do not tolerate this type
of behavior, from anyone,” she
said.
Petrobras to Pay $3 Billion
Brazilian oil company
reaches one of biggest
settlements ever in
U.S. corruption lawsuit
BY PAUL KIERNAN
RIO DE JANEIRO—Brazilian
state-run oil company Petróleo Brasileiro SA said
Wednesday that it would pay
one of the highest settlements
ever to end a class-action lawsuit by U.S. investors who had
sought to recoup corruptionrelated losses.
Petrobras, as the company
is known, said it agreed to pay
$2.95 billion to resolve claims
by investors who bought its
U.S.-listed shares or bonds between January 2010 and July
2015. During most of that period, Brazilian courts have
since found, Petrobras was
spending tens of billions of
dollars a year on contracts
that were inflated by one of
the
biggest
corruption
schemes ever uncovered.
If approved, the settlement
would likely rank as the fifthlargest on record for securities
class-action suits, according to
Stanford Law School and Cornerstone Research, which
jointly track such cases. As the
largest payout ever by a foreign corporation, it also could
have far-reaching implications
for overseas companies that
tap U.S. equity or debt mar-
SERGIO MORAES/REUTERS
Fidelity Changes
Job of Equity
Unit’s President
The Rio de Janeiro headquarters of the oil major, which is recovering from a corruption scandal.
kets for funding, experts say.
“We are very pleased with
this historic settlement,”
plaintiffs’ attorney Jeremy
Lieberman said, noting that
precedent-setting decisions
over the three-year trial could
help other investors build
class-action cases.
By plaintiffs’ estimates, the
bribery scheme now known as
Car Wash contributed to wiping out some $271 billion, or
almost 90%, of Petrobras’s
market value between 2009
and 2015.
According to thousands of
Brazilian court documents,
Legal Notices
BY MARIA ARMENTAL
cused of making false statements and obstructing justice.
Ronald White, a lawyer for
Mr. Cohen, denied the charges.
“Mr. Cohen has done nothing wrong and is confident
that when all the evidence is
presented, it will be shown
that the government’s charges
are baseless,” Mr. White wrote
in an emailed statement.
Mr. Cohen served as head of
Och-Ziff’s European office and
had oversight of the fund’s investments in Europe, the Middle East and Africa. He resigned from Och-Ziff in 2013
amid a federal investigation
into whether the firm had paid
bribes to African governments
to get business. The U.S. Foreign Corrupt Practices Act
bars firms doing business in
the U.S. from giving money or
Michael L. Cohen, once a
highflying deal maker at
hedge-fund giant Och-Ziff
Capital Management Group
LLC, is facing criminal charges
in connection with an alleged
scheme that yielded one of the
largest foreign bribery settlements in U.S. history.
According to an indictment,
filed in Brooklyn federal court
in October and unsealed on
Wednesday, Mr. Cohen and unnamed conspirators orchestrated a plan to defraud an
Och-Ziff client, identified in
court documents only as a
U.K.-based charitable foundation.
In addition to charges of
fraud and conspiracy to commit fraud, Mr. Cohen is ac-
Wednesday, January 3, 2018
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items of value to foreign officials for business.
In 2016, Och-Ziff agreed to
pay $412 million to settle related civil and criminal claims.
The federal investigation
led last year to a civil complaint by the Securities and
Exchange Commission against
Mr. Cohen and another former
Och-Ziff executive. The SEC accused them of spearheading a
bribery scheme that allegedly
funneled millions of dollars in
bribes to high-level officials in
African countries to secure
mining assets and other deals.
The firm also reached a
three-year deferred prosecution agreement with federal
prosecutors and agreed to bolster its internal controls, while
an African subsidiary of OchZiff pleaded guilty in Brooklyn
Stock
The following explanations apply to the New York Stock Exchange, NYSE Arca, NYSE American
and Nasdaq Stock Market stocks that hit a new 52-week intraday high or low in the latest
session. % CHG-Daily percentage change from the previous trading session.
To advertise: 800-366-3975 or WSJ.com/classifieds
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E 59 < E 0 7 ! M = I @$ F tion and allowed to collect
some $453 million in restitution from former executives
and suppliers. But legal experts say it was always far
from certain whether U.S.
courts would follow suit.
The U.S. plaintiffs, including the Hawaii state employees’ retirement system and the
North Carolina state treasurer,
argued that Petrobras was
complicit in concealing the
corruption and that it significantly overstated the value of
assets inflated by the scheme,
including in disclosures made
after Car Wash became public.
Former Fund Star Faces Bribery Charges
New Highs and Lows | WSJ.com/newhighs
ADVERTISEMENT
Petrobras’s contractors colluded for at least a decade to
drive up the price of services
they billed to the oil company
while paying billions of dollars
in kickbacks to corrupt Petrobras executives and government officials.
“The agreement is in the
company’s best interest and
that of its shareholders, given
the risks of a verdict advised
by a jury,” Petrobras said.
Petrobras has long maintained that it was a victim of
the scheme, and local authorities agree. In Brazil, Petrobras
has been spared from prosecu-
0.2 Chegg
4.88 24.7 CheniereEnergy
CCS
33.70
5.5
GTLS
51.03
5.4
CHGG
17.04
1.3
LNG
56.14
1.0
AFH
21.45 -1.4 Chevron
CVX
128.94
0.7
BOLD
35.75
4.8 ChinaEastrnAir
CEA
38.29
5.7
ATHM
72.41
1.9 ChinaHGSRealEst HGSH
BHP
47.80
0.4 CiscoSystems
CSCO
39.28
0.8
BBL
42.02
0.8 CitizensFin
CFG
43.29
1.1
BPMP
21.68
4.3 CitrixSystems
CTXS
89.85
1.1
BP
42.89
1.2 CommercialMetals CMC
25.18
6.7
BSAC
32.74
0.1 CerveceriasUnid
CCU
30.35 -1.2
BAX
68.67
1.6 ConocoPhillips
COP
56.39
1.8
BECN
66.43
2.1 ConTomka
CTO
65.00
1.5
BRACU
10.30
0.6 ContinentalBldg
CBPX
28.60 -0.9
BB
13.56 12.6 ContinentalRscs CLR
55.36
1.3
BBU
34.91 -0.1 Corning
GLW
33.44
2.5
BKE
25.11
1.0 Cosan
CZZ
10.29 -1.2
BLDR
22.46
1.9 Credicorp
BAP
CDW
71.91
2.9 CreditSuisse
CF
43.54
4.48 94.3
218.88
1.8
CS
18.12
1.0
CUE
12.94
9.6
2.8 DaqoNewEnergy DQ
64.75
0.9
98.68
2.3
... CueBiopharma
CEO
151.75
CAA
60.21
3.9 Darden
GOOS
33.43
3.4 DecipheraPharm DCPH
26.27
3.7
CM
98.40
0.2 DelekUS
36.21
0.6
CNQ
37.32
1.7 DiamondOffshore DO
CSL
118.60
DRI
DK
0.9 DiamondbkEner
FANG
20.23
2.4
129.74
1.0
CELC
22.73 -1.0 DianaShippingPfd DSXpB
25.12
0.4
CBMG
14.70 14.4 DolbyLab
63.37
0.3
DLB
52-Wk %
Sym Hi/Lo Chg Stock
Domtar
Dover
Dunkin'
EOG Rscs
EPAM Systems
E*TRADE
EagleMaterials
EastmanChem
EtnVncTABS
eBay
Ecopetrol
EditasMedicine
eGain
EigerBioPharma
EmbotellAndinaA
Embraer
EmclaireFin
EmersonElec
EmpresaDisCom
Encana
EnelAmericas
Euronav
FMC
FSB Bancorp
Facebook
FedEx
FiatChrysler
FidelityD&D
FirstBancshares
FirstCash
FirsthandTechVal
FiveBelow
FranklinCovey
FreeportMcM
GRAVITY
GalectinTherap
GalmedPharm
UFS
50.97
DOV
102.75
federal court to conspiracy to
commit bribery. The deferredprosecution deal covered only
the firm.
Mr. Cohen has asked the
case be dismissed, citing timing and jurisdictional issues
and saying that the SEC “relies
on speculation and innuendo
for its core premise that Mr.
Cohen knew of any violations
of law.”
Daniel Och, who founded
the hedge-fund management
firm and serves as its chairman and chief executive,
agreed to pay a civil sanction
of $2.2 million to the SEC for a
record-keeping violation without admitting or denying the
allegations.
—Scott Patterson
and Michael Rothfeld
contributed to this article.
52-Wk %
Sym Hi/Lo Chg Stock
GLOP
25.50
0.8 Gener8Maritime GNRT
0.5 GasLogPartners
6.86
66.40
0.7 GeneralFin
GFN
7.15
EOG
111.83
1.5 GIIIApparel
GIII
38.42
EPAM
110.76
1.3 GlShipLeasePfdB GSLpB
25.36
ETFC
51.21
1.6 GolarLNG
GLNG
31.64
EXP
118.23
0.3 Graco
EMN
95.62
DNKN
EVLMC 100.06
2.2
LAZ
54.10
2.8
TREE
357.30
3.0
LEN.B
46.05
54.90
4.2
15.92
0.7 Lennar A
LEN
67.40
3.7
LX
18.29 -11.0
3.0 GuangshenRail
GSH
67.45 -0.4 LexinFintech
34.77 2.5 LomaNegra
LOMA
4.9 HVBancorp
HVBC
17.20
25.07 -2.6
LUNA
HAE
63.90 -0.7 LyondellBasell
48.94 1.4 MillAcqn Un
5.5 HailiangEduc
HLG
14.70
2.1 Hill-Rom
HRC
87.58
AKO.A
27.88
4.0 HondaMotor
HMC
34.83
ERJ
26.61
4.0 HorizonTechFin
HRZN
EMCF
32.99
... DR Horton
DHI
EMR
71.46
0.9 Hortonworks
HDP
EDN
52.60
1.5 JBHunt
JBHT
ECA
14.01
0.6 Huntsman
HUN
ENIA
11.44 -1.0 HyattHotels
H
9.50 -0.5 IRSA
IRS
FMC
97.07
1.3 Illumina
ILMN
FSBC
18.00
1.1 Insmed
INSM
FB
184.78
1.8 IntlPaper
IP
FDX
261.57
1.2 iRhythmTechs
IRTC
FCAU
19.31
FDBC
45.35
FBMS
35.10 -2.5 JPMUSMinimumVol JMIN
FCFS
69.50
SVVC
9.30
FIVE
71.79
4.1 JPMorganChase JPM
... JamesHardie
JHX
2.2 KB Fin
KB
1.7 KB Home
KBH
2.4 KKR
KKR
FC
22.75 -3.1 KaiserAlum
KALU
FCX
19.85 -1.5 KenonHoldings
KEN
GRVY
99.00
KINS
1.6 Kingstone
4.80 13.5 KirklandLakeGold KL
10.70
0.5
LPLA
59.14
GGAL
36.00 -2.9 Haemonetic
GLMD
4.0
41.67
GPK
16.15
GALT
78.93
LKQ
0.9 LPL Financial
5.0 Lazard
GGG
EDIT
EURN
51.50 -1.0
LGIH
1.1 GraphicPkg
EC
EIGR
KRA
0.1 GpoFinGalicia
39.28
5.75
1.0 Kraton
1.2 LGI Homes
2.9 LKQ
0.2 LendingTree
1.7 Lennar B
EBAY
EGAN
52-Wk %
Sym Hi/Lo Chg
7.3 Knight-Swift
KNX
5.4 LunaInnov
1.9 MillAcqn Wt
0.9 MV Oil
2.65
LYB
MIIIU
...
11.55
2.3
0.99 14.5
MIIIW
MVO
11.81 -0.4 MarathonPetrol MPC
52.98 3.5 MatadorResources MTDR
22.00 1.2
MatchGroup
MTCH
118.05 0.7
MesaRoyalty
MTR
34.65 1.2
MesabiTrust
MSB
74.93 1.2
Methanex
MEOH
32.20 -0.3
MichaelKors
KORS
231.23 2.8
Michaels
MIK
33.54 1.6
MurphyOil
MUR
60.83 1.3
NVR
NVR
58.38 0.8
NXP Semi
NXPI
108.49 0.1
NeptuneTech
NEPT
17.95 1.1
Netflix
NFLX
25.84 0.2
Netgear
NTGR
59.44
...
Neurocrine
NBIX
33.78 4.5
NewHome
NWHM
22.00 2.1
NewOrientalEduc EDU
109.94 -0.1
NewYork
NWY
22.49 2.3
Newmark
NMRK
20.10 3.4
NexaResources NEXA
16.23 0.1
45.27
3.2
112.42
9.74 -1.5
68.97
2.1
32.27
1.0
33.08 -1.1
19.85
3.5
27.30
...
64.25
2.1
64.36 -0.4
24.52 -0.5
32.87
0.9
3599.70
0.9
118.53
0.1
2.73 13.8
206.21
2.0
61.65
2.2
83.08
4.6
13.54
2.8
102.50
3.9
3.00
3.5
16.22 -2.5
21.20
0.3
Continued on Page B9
0.8
Borrowing Benchmarks | WSJ.com/bonds
Money Rates
January 3, 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
Inflation
Nov. index
level
Chg From (%)
Oct. '17 Nov. '16
U.S. consumer price index
All items
Core
246.669
253.492
0.002
–0.06
2.2
1.7
International rates
Latest
Week
ago
52-Week
High
Low
Prime rates
U.S.
Canada
Japan
4.50 4.50 4.50 3.75
3.20 3.20 3.20 2.70
1.475 1.475 1.475 1.475
Policy Rates
Euro zone
Switzerland
Britain
Australia
0.00
0.50
0.50
1.50
0.00
0.50
0.50
1.50
0.00
0.50
0.50
1.50
0.00
0.50
0.25
1.50
1.56
1.51
Federal funds
Effective rate
High
Low
Bid
Offer
1.4200
1.5625
1.3500
1.4100
1.4200
1.4400
1.6125
1.3900
1.4100
1.4400
0.6000
0.8125
0.4500
0.5600
0.5800
Treasury bill auction
1.270 1.245 1.300 0.400
1.435 1.445 1.445 0.505
1.575 1.530 1.575 0.590
4 weeks
13 weeks
26 weeks
1.62
Secondary market
2.00
1.62
1.68
0.72
1.56900
1.69693
1.84363
2.11782
0.76333
1.00511
1.32100
1.68456
30 days
60 days
3.501 3.552 3.865 3.253
3.535 3.584 3.899 3.281
Week
ago
52-Week
high
low
3.25
3.25
3.25
2.50
Six month
-0.271 -0.271 -0.224 -0.276
One year
-0.187 -0.186 -0.085 -0.194
Libor
One month
Three month
Six month
One year
1.55688
1.69593
1.84269
2.11782
1.56900
1.69339
1.84300
2.11063
Euro Libor
One month
Three month
Six month
One year
-0.408
-0.385
-0.325
-0.252
-0.420
-0.385
-0.322
-0.245
-0.379
-0.339
-0.229
-0.087
-0.420
-0.387
-0.325
-0.261
30-year mortgage yields
Latest
1.25
1.68
One month
Three month
Call money
2.00
90 days
Euro interbank offered rate (Euribor)
U.S. government rates
2.00
—52-WEEK—
High Low
Fannie Mae
0.48
Discount
Week
Latest ago
Commercial paper (AA financial)
1.4200
1.5625
1.3000
1.4100
1.4200
Other short-term rates
Overnight repurchase
U.S.
—52-WEEK—
High Low
-0.368 -0.368 -0.366 -0.375
-0.329 -0.329 -0.320 -0.332
Latest
Value
Traded
52-Week
High
Low
DTCC GCF Repo Index
37.900 1.836 0.489
Treasury
1.546
MBS
1.582 111.500 1.852 0.496
Open Implied
Settle Change Interest Rate
DTCC GCF Repo Index Futures
Treasury Jan
98.515 -0.025 2256 1.485
Treasury Feb
98.535 -0.005
828 1.465
Treasury Mar
98.450 -0.005
282 1.550
Notes on data:
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 December 14, 2017. Other prime rates aren’t directly comparable; lending practices
vary widely by location; Discount rate is effective December 14, 2017. 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.
Sources: Federal Reserve; Bureau of Labor Statistics; DTCC; SIX Financial Information;
Tullett Prebon Information, Ltd.
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | B9
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.
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.
Wednesday, January 3, 2018
Net
Sym Close Chg
Stock
A B C
s ABB
ABB 27.22
AECOM
ACM 38.61
AES
AES 10.87
Aflac
AFL 88.23
AGNC Invt
AGNC 19.62
Ansys
ANSS 151.42
ASML
ASML 179.08
AT&T
T
37.65
AbbottLabs ABT 58.92
s AbbVie
ABBV 99.95
Abiomed
ABMD 195.82
Accenture
ACN 154.55
ActivisionBliz ATVI 65.31
AcuityBrands AYI 177.64
Adient
ADNT 78.48
AdobeSystems ADBE 181.04
AdvanceAuto AAP 107.05
AdvMicroDevices AMD 11.55
AdvSemiEngg ASX
6.62
s Aegon
AEG
6.34
AerCap
AER 52.68
Aetna
AET 181.80
AffiliatedMgrs AMG 202.12
AgilentTechs A
69.32
AgnicoEagle AEM 46.46
s AirProducts APD 166.41
AkamaiTech AKAM 65.94
AlaskaAir
ALK 74.66
Albemarle
ALB 131.79
Alcoa
AA
54.50
AlexandriaRlEst ARE 129.32
AlexionPharm ALXN 124.95
Alibaba
BABA 184.00
AlignTech
ALGN 231.20
Alkermes
ALKS 55.89
Alleghany
Y
585.03
Allegion
ALLE 80.25
Allergan
AGN 170.14
AllianceData ADS 260.07
AlliantEnergy LNT 41.74
AllisonTransm ALSN 44.16
Allstate
ALL 101.98
s AllyFinancial ALLY 29.29
AlnylamPharm ALNY 134.65
s Alphabet A GOOGL 1091.52
s Alphabet C GOOG 1082.48
s Altaba
AABA 73.78
AlticeUSA
ATUS 21.67
Altria
MO 70.48
AlumofChina ACH 19.32
Amazon.com AMZN 1204.20
Ambev
ABEV 6.65
Amdocs
DOX 66.61
Amerco
UHAL 375.64
Ameren
AEE 58.09
AmericaMovil A AMOV 17.14
AmericaMovil AMX 17.29
AmerAirlines AAL 52.34
AEP
AEP 71.80
AmerExpress AXP 99.55
AmericanFin AFG 107.09
AmerHomes4Rent AMH 21.48
AIG
AIG 60.16
AmerTowerREIT AMT 141.68
AmerWaterWorks AWK 88.45
Ameriprise AMP 169.07
AmerisourceBrgn ABC 94.39
s Ametek
AME 73.39
Amgen
AMGN 180.34
Amphenol
APH 88.94
AnadarkoPetrol APC 54.77
AnalogDevices ADI 91.40
s Andeavor
ANDV 116.46
AndeavorLog ANDX 49.25
AB InBev
BUD 113.29
AnnalyCap
NLY 11.47
AnteroResources AR
19.78
Anthem
ANTM 229.15
Aon
AON 133.59
Apache
APA 45.33
ApartmtInv AIV 43.51
s ApolloGlbMgmt APO 34.27
Apple
AAPL 172.23
ApplMaterials AMAT 53.98
Aptiv
APTV 87.54
AquaAmerica WTR 38.26
Aramark
ARMK 43.23
s ArcelorMittal MT
34.91
ArchCapital ACGL 88.38
ArcherDaniels ADM 39.78
Arconic
ARNC 27.98
AristaNetworks ANET 235.60
ArrowElec
ARW 81.76
AstraZeneca AZN 35.45
Athene
ATH 50.66
Atlassian
TEAM 50.40
AtmosEnergy ATO 84.34
Autodesk
ADSK 109.38
0.20
0.89
-0.01
0.26
-0.32
2.87
1.35
-0.89
0.13
1.54
3.33
0.71
1.00
-2.17
-0.81
3.34
0.96
0.57
...
...
0.05
1.11
-0.92
1.72
-0.27
0.90
0.38
-0.35
0.26
-0.67
-0.61
0.90
0.35
6.58
0.66
2.31
0.34
-0.18
4.74
-0.37
0.30
0.06
-0.14
2.80
18.31
17.48
0.65
0.23
-0.26
0.42
15.19
0.04
0.43
-3.97
-0.30
-0.17
-0.19
-0.65
-0.61
0.61
0.32
-0.01
0.66
0.55
-0.63
-0.84
0.35
0.64
3.34
1.14
...
1.12
1.69
2.06
0.87
-0.20
...
3.15
2.10
1.03
0.06
0.67
-0.03
0.94
1.43
-0.39
-0.05
0.83
0.08
-0.31
0.22
4.57
0.54
0.07
-0.24
3.34
-0.70
2.26
Stock
Net
Sym Close Chg
s Autohome
ATHM 72.28 1.38
Autoliv
ALV 129.00 1.14
ADP
ADP 117.25 1.26
AutoZone
AZO 749.43 12.89
Avalonbay
AVB 177.79 0.55
Avangrid
AGR 49.50 -0.61
AveryDennison AVY 116.01 0.33
AxaltaCoating AXTA 32.29 0.25
BB&T
BBT 50.46 0.54
BCE
BCE 47.47 -0.33
s BHPBilliton BHP 47.71 0.19
s BHPBilliton BBL 42.00 0.34
BOK Fin
BOKF 92.25 -0.10
s BP
BP
42.87 0.49
BRF
BRFS 11.43
...
BT Group
BT
18.47 -0.34
BWX Tech
BWXT 61.06 0.53
Baidu
BIDU 245.55 3.15
BakerHughes BHGE 33.53 1.30
Ball
BLL 38.53 -0.10
BancoBilbaoViz BBVA 8.54
...
BancodeChile BCH 98.91 -1.99
BancoMacro BMA 116.75 -0.19
s BcoSantChile BSAC 32.41 0.04
BancoSantander SAN
6.53 -0.02
BanColombia CIB
41.05 0.22
BankofAmerica BAC 29.80 -0.10
BankofMontreal BMO 80.34 0.13
BankNY Mellon BK
54.15 0.33
BkNovaScotia BNS 65.10 -0.04
BankofOzarks OZRK 48.51 0.12
Barclays
BCS 10.99 -0.04
BarrickGold ABX 15.00 -0.20
s BaxterIntl
BAX 68.25 1.08
BectonDicknsn BDX 219.99 2.15
Berkley
WRB 69.46 -0.58
BerkHathwy B BRK.B 199.79 2.57
BerkHathwy A BRK.A 2999044149.97
BerryGlobal BERY 59.67 0.26
BestBuy
BBY 68.40 -0.76
Bio-RadLab A BIO 250.47 9.05
Biogen
BIIB 339.85 5.68
BioMarinPharm BMRN 92.08 1.05
Bioverativ
BIVV 55.39 0.44
BlackKnight BKI
45.80 -0.05
s BlackBerry
BB 13.53 1.51
BlackRock
BLK 514.34 5.37
Blackstone
BX
33.00 0.48
BlueBuffaloPet BUFF 32.45 -0.26
bluebirdbio BLUE 179.75 -2.15
Boeing
BA 297.80 0.96
BorgWarner BWA 52.04 0.26
BostonProps BXP 129.35 0.07
BostonSci
BSX 25.56 0.28
Braskem
BAK 26.97 -0.29
BrightHorizons BFAM 94.16 0.13
BrighthouseFin BHF 58.51 0.84
Bristol-Myers BMY 61.36 0.05
BritishAmTob BTI
66.62 -0.56
Broadcom
AVGO 269.93 2.92
BroadridgeFinl BR
90.72 -0.08
BrookfieldMgt BAM 43.23 0.18
BrookfieldInfr BIP
43.95 -0.69
Brown&Brown BRO 51.66 0.58
Brown-Forman B BF.B 68.19 0.49
Brown-Forman A BF.A 66.94 -0.53
BuckeyePtrs BPL 53.11 2.33
Bunge
BG
69.45 1.46
BurlingtonStrs BURL 121.35 -0.89
CA
CA
33.71 0.13
CBD Pao
CBD 23.96 0.02
CBRE Group CBG 44.19 0.37
CBS B
CBS 59.20 0.03
CBS A
CBS.A 59.60 0.13
CDK Global CDK 70.40 -0.26
s CDW
CDW 71.80 2.04
s CF Industries CF
43.15 0.01
CGI Group
GIB
54.17 -0.40
CH Robinson CHRW 89.49 -0.25
CIT Group
CIT
50.45 0.52
CME Group CME 147.11 2.32
CMS Energy CMS 46.66 -0.29
CNA Fin
CNA 52.67 0.25
s CNOOC
CEO 151.70 4.16
CPFLEnergia CPL 11.71 -0.09
CRH
CRH 36.62 0.23
CSX
CSX 57.05 0.71
CVS Health CVS 73.20 -0.32
CabotOil
COG 29.03 0.13
CadenceDesign CDNS 42.93 0.88
CaesarsEnt CZR 12.48 0.03
s CalAtlantic
CAA 60.10 2.24
CamdenProperty CPT 91.68 0.18
CampbellSoup CPB 46.72 -0.67
s CIBC
CM
98.12 0.24
CanNtlRlwy CNI
83.43 0.15
s CanNaturalRes CNQ 37.15 0.61
CanPacRlwy CP 183.68 0.43
Canon
CAJ 37.95 0.37
CapitalOne COF 99.44 -0.17
CardinalHealth CAH 62.86 -0.37
Net
Sym Close Chg
Stock
s Carlisle
CSL 118.10
Carlyle
CG
23.90
CarMax
KMX 66.94
Carnival
CCL 66.90
Carnival
CUK 66.89
Caterpillar
CAT 157.28
Cavium
CAVM 87.20
CboeGlobalMkts CBOE 123.56
Celanese A CE 107.18
Celgene
CELG 109.14
Cemex
CX
7.88
CenovusEnergy CVE 10.30
Centene
CNC 104.43
CenterPointEner CNP 27.96
CentraisElBras EBR
5.74
CenturyLink CTL 17.08
Cerner
CERN 69.07
CharterComms CHTR 353.03
CheckPoint CHKP 105.21
Chemours
CC
51.41
s CheniereEnergy LNG 55.27
CheniereEnerPtrs CQP 29.82
CheniereEnHldgs CQH 28.70
s Chevron
CVX 128.51
s ChinaEastrnAir CEA 38.29
ChinaLifeIns LFC 16.14
ChinaLodging HTHT 154.93
ChinaMobile CHL 50.05
ChinaPetrol SNP 76.66
ChinaSoAirlines ZNH 53.80
ChinaTelecom CHA 48.04
ChinaUnicom CHU 13.94
Chipotle
CMG 309.00
Chubb
CB 143.42
ChunghwaTel CHT 36.18
Church&Dwight CHD 49.11
Cigna
CI
205.96
CimarexEnergy XEC 126.20
CincinnatiFin CINF 72.79
Cintas
CTAS 158.42
s CiscoSystems CSCO 39.17
Citigroup
C
74.59
s CitizensFin CFG 43.17
s CitrixSystems CTXS 89.65
Clorox
CLX 143.43
Coca-Cola
KO
45.44
Coca-Cola Euro CCE 39.39
Coca-Cola Femsa KOF 70.00
Cognex
CGNX 63.71
CognizantTech CTSH 71.55
Coherent
COHR 296.65
ColgatePalm CL
74.85
t ColonyNorthStar CLNS 11.07
Comcast A CMCSA 40.41
Comerica
CMA 86.54
CommerceBcshrs CBSH 55.72
CommScope COMM 38.15
SABESP
SBS 10.51
ConagraBrands CAG 37.33
ConchoRscs CXO 152.59
s ConocoPhillips COP 56.34
ConEd
ED
82.79
ConstBrands A STZ 227.50
s ContinentalRscs CLR 54.94
Cooper
COO 226.74
Copart
CPRT 43.39
s Corning
GLW 33.42
CoStar
CSGP 307.50
Costco
COST 190.58
Coty
COTY 19.77
s Credicorp
BAP 217.46
CreditAcceptance CACC 326.07
s CreditSuisse CS
18.06
CrownCastle CCI 108.47
CrownHoldings CCK 57.09
Ctrip.com
CTRP 46.60
Cullen/Frost CFR 95.13
Cummins
CMI 179.01
1.11
0.60
2.18
0.15
-0.07
0.24
1.62
0.81
0.42
2.98
0.14
0.56
1.84
-0.06
-0.09
-0.33
0.50
4.06
1.44
-0.33
0.57
-0.02
0.36
0.93
2.07
0.07
-3.93
-0.71
0.52
3.26
-0.10
0.01
16.05
1.12
0.07
-0.32
3.40
0.69
-0.29
1.57
0.31
0.23
0.49
0.96
-1.56
-0.10
-0.32
-1.21
2.33
0.60
5.36
-0.29
-0.30
-0.66
-0.03
-0.23
-0.05
-0.10
-0.19
0.69
1.02
-0.79
0.94
0.68
6.12
-0.20
0.80
10.71
2.26
-0.11
3.88
-2.56
0.18
-0.46
0.16
0.53
-0.09
1.95
D E F
DISH Network DISH 49.36
DTE Energy DTE 108.10
DXC Tech
DXC 96.85
Danaher
DHR 93.67
s Darden
DRI 98.54
DaVita
DVA 72.91
Deere
DE 158.73
DellTechs
DVMT 83.30
DeltaAir
DAL 55.69
DentsplySirona XRAY 66.91
DeutscheBank DB
19.16
DevonEnergy DVN 42.72
Diageo
DEO 145.56
s DiamondbkEner FANG 129.17
DigitalRealty DLR 113.69
DiscoverFinSvcs DFS 77.48
DiscovComm C DISCK 21.48
DiscovComm B DISCB 24.06
DiscovComm A DISCA 22.62
Disney
DIS 112.28
-0.84
-0.35
1.80
1.23
2.22
0.37
0.72
0.87
-1.05
-0.23
-0.17
0.49
0.43
1.29
1.03
0.57
-0.35
-0.95
-0.49
0.48
Mutual Funds | WSJ.com/fundresearch
Explanatory Notes
Fund
+0.46
+0.25
+0.14
+0.09
+0.01
+0.03
+0.25
+0.34
+0.36
+0.42
+0.03
+0.17
+0.04
+0.39
+0.38
+0.39
+0.24
+0.01
+0.18
+0.02
+0.01
19.88
GlblAlloc p
2.3 BlackRock Funds Inst
22.96
EqtyDivd
2.1 GlblAlloc
20.00
1.0 StratIncOpptyIns 9.97
0.7 Bridge Builder Trust
-0.1 CoreBond
NA
0.4 Dimensional Fds
1.6 5GlbFxdInc
10.87
1.9 EmgMktVa
31.92
1.6 EmMktCorEq 23.73
2.1 IntlCoreEq
14.75
0.4 IntlVal
20.84
1.3 IntSmCo
21.56
0.5 IntSmVa
23.31
2.0 US CoreEq1
23.09
2.6 US CoreEq2
21.85
1.8 US Small
36.30
1.4 US SmCpVal 38.35
0.1 US TgdVal
25.22
1.0 USLgVa
39.67
Dodge & Cox
-0.1 Balanced
108.24
-0.1 Income
13.75
47.23
Intl Stk
+0.05
+0.07
+0.06
...
...
...
+0.17
+0.12
+0.06
+0.10
+0.08
+0.07
+0.11
+0.09
+0.04
+0.04
+0.06
+0.13
+0.43
+0.01
+0.42
52-Wk %
Sym Hi/Lo Chg Stock
52-Wk % Stock
Sym Hi/Lo Chg PackagingCpAm PKG
126.58 1.9 RelianceSteel
Continued From Page B8
Stock
NorfolkSouthern
NovoNordisk
Nucor
OakValleyBncp
OccidentalPetrol
OhrPharm
OldDomFreight
Olin
ON Semi
OrionEngCarbons
Otelco
OwensCorning
OxfordIndustries
PBF Energy
POSCO
PVH
NSC
147.54
... ParkerHannifin
NVO
54.75
1.0
NUE
67.73
1.3
OVLY
20.96
3.9
OXY
75.11
1.4
OHRP
2.18
3.0
ODFL
135.00
0.1
OLN
37.62
2.2
ON
22.86
4.4
OEC
26.40
1.0
OTEL
14.32
2.6
OC
94.11
2.0
OXM
77.37 -1.3
PBF
37.01
0.2
PKX
85.50
3.4
PVH
139.76
0.2
PH
PatrickIndustries PATK
PeabodyEnerPfdA BTUp
PembinaPipeline PBA
PennyMacFinS PFSI
PerkinElmer
PKI
Phillips66
PSX
PierisPharm
PIRS
Pool
POOL
Praxair
PX
ProgressSoftware PRGS
ProvidenceService PRSC
REGENXBIO
RGNX
REV
REVG
Rayonier
RYN
Reading A
RDI
Stock
52-Wk %
Sym Hi/Lo Chg
RS
88.68
RENN
18.70 47.4
RFP
11.55
...
1.2 RioTinto
RIO
55.00
0.4
36.69 -0.1 RockwellCollins
COL
136.64
0.5
23.65
ROG
184.00 -1.9
201.60
0.8 Renren
71.13 -0.2 ResoluteForest
75.00
76.20
0.6 Rogers
0.4
3.0 RoyalBkCanada
RY
83.11
0.6
0.7 RoyalDutchA
RDS.A
68.69
0.8
7.90 -8.1 RoyalDutchB
RDS.B
70.21
1.0
132.29 -0.1 RyderSystem
R
87.71
1.2
157.69
SMTX
2.09
5.9
102.80
43.71
0.8 SMTC
0.2 SangamoTherap SGMO
18.70 -0.9
61.00 -0.3 SareptaTherap
SRPT
59.00
0.5
36.45
SSL
34.54
0.7
3.0 Sasol
33.10 -0.2 SchnitzerSteel
32.21
17.15
24.00
Balanc
90.07
BluCh
Contra
125.10
ContraK
125.03
CpInc r
10.38
DivIntl
40.44
GroCo
183.68
183.65
GrowCoK
7.91
InvGB
11.23
InvGrBd
55.12
LowP r
LowPriStkK r 55.07
106.62
MagIn
112.83
OTC
23.70
Puritn
SrsEmrgMkt 21.97
SrsGroCoRetail 17.10
SrsIntlGrw
16.33
SrsIntlVal
10.81
TotalBond
10.63
+0.11
+0.91
+1.26
+1.26
+0.03
+0.18
+2.23
+2.23
+0.01
+0.01
+0.25
+0.25
+1.07
+1.29
+0.13
+0.13
+0.21
+0.08
+0.05
+0.01
207.48 +1.31 1.9
0.9 Stock
DoubleLine Funds
NA
... NA
0.8 TotRetBdI
1.0 Edgewood Growth Instituti
0.1 EdgewoodGrInst 30.39 +0.48 2.8
Federated Instl
6.13 -0.02 -0.3
NA StraValDivIS
Fidelity
94.83 +0.60 1.5
... 500IdxInst
2.2 500IdxInstPrem 94.83 +0.60 1.5
2.2 500IdxPrem 94.83 +0.60 1.5 First Eagle Funds
1.4 ExtMktIdxPrem r 62.76 +0.21 1.1 GlbA
59.65 +0.24
1.7 IntlIdxPrem r 43.61 +0.19 1.0 FPA Funds
14.49
+0.09
1.5
SAIUSLgCpIndxFd
1.4
35.06 +0.22
FPACres
77.46 +0.45 1.4 FrankTemp/Frank Adv
1.5 TMktIdxF r
1.4 TMktIdxPrem 77.45 +0.45 1.4 IncomeAdv
2.37
...
1.3 USBdIdxInstPrem 11.57 +0.01 -0.2 FrankTemp/Franklin A
1.0 Fidelity Advisor I
7.47 -0.02
CA TF A p
32.67 +0.31 2.0 IncomeA p
1.1 NwInsghtI
2.39
...
Fidelity
Freedom
1.3
62.09 +0.37
RisDv A p
16.72 +0.06 0.9 FrankTemp/Franklin C
1.4 FF2020
14.54 +0.05 1.0 Income C t
FF2025
2.42
...
18.27 +0.08 1.2 FrankTemp/Temp A
1.2 FF2030
-0.1 Freedom2020 K 16.70 +0.07 0.9 GlBond A p
12.05 +0.08
2.0 Freedom2025 K 14.52 +0.06 1.0 Growth A p
27.72 +0.12
New Highs and Lows | WSJ.com/newhighs
SCHN
0.6 ScottsMiracleGro SMG
2.5 ServiceNow
NOW
35.40 -0.9
109.77
133.25
0.2
0.9
s
s
s
s
s
s
s
s
ShakeShack
SherwinWilliams
Silicom
SiliconMotion
Siliconware
SkechersUSA
SolarisOilfield
SoCopper
SparkNetworks
Splunk
Statoil
SteelDynamics
StemlineTherap
StifelFinancial
StudentTransprt
SunHydraulics
SuncorEnergy
SynchronyFin
Synnex
Grainger
GWW 234.23
GreatPlainsEner GXP 31.60
Grifols
GRFS 23.35
GrubHub
GRUB 71.32
GpoAeroportuar PAC 105.95
GpoAvalAcc AVAL 8.81
GpoFinGalicia GGAL 66.92
GpFinSantMex BSMX 7.63
GrupoTelevisa TV
19.33
HCA Healthcare HCA 87.04
HCP
HCP 25.90
HDFC Bank HDB 101.34
HD Supply
HDS 39.64
HP
HPQ 21.37
HSBC
HSBC 52.15
Halliburton HAL 50.50
Hanesbrands HBI 21.03
HarleyDavidson HOG 50.10
Harris
HRS 142.82
HartfordFinl HIG 54.83
Hasbro
HAS 91.29
HealthcareAmer HTA 29.83
Heico A
HEI.A 78.10
Heico
HEI
93.68
Helm&Payne HP
65.65
HenrySchein HSIC 72.14
Herbalife
HLF 68.83
Hershey
HSY 111.64
Hess
HES 49.40
HewlettPackard HPE 14.70
Hilton
HLT 80.85
HollyFrontier HFC 51.38
Hologic
HOLX 43.49
HomeDepot HD 189.01
HondaMotor HMC 34.79
Honeywell
HON 152.44
HormelFoods HRL 36.00
DR Horton
DHI 52.86
HostHotels HST 19.87
HuanengPower HNP 25.59
Hubbell
HUBB 133.34
Humana
HUM 251.28
JBHunt
JBHT 116.87
HuntingtonBcshs HBAN 14.72
HuntingIngalls HII 229.39
Huntsman
HUN 34.60
HyattHotels H
74.70
IAC/InterActive IAC 132.64
ICICI Bank
IBN
9.85
IdexxLab
IDXX 162.05
IHSMarkit
INFO 45.21
ING Groep
ING 18.60
Invesco
IVZ
36.53
IPG Photonics IPGP 233.24
IQVIA
IQV 99.52
IRSA Prop
IRCP 55.55
IcahnEnterprises IEP
54.70
Icon
ICLR 114.02
IDEX
IEX 132.87
IllinoisToolWks ITW 165.96
Illumina
ILMN 230.32
ImperialOil
IMO 31.62
Incyte
INCY 100.98
Infosys
INFY 16.15
Ingersoll-Rand IR
89.95
Ingredion
INGR 138.13
Intel
INTC 45.26
InteractiveBrkrs IBKR 59.14
ICE
ICE
70.91
InterContinentl IHG 63.55
IBM
IBM 158.49
IntlFlavors
IFF 155.74
IntlPaper
IP
60.56
Interpublic
IPG
19.76
Intuit
INTU 159.16
IntuitiveSurgical ISRG 383.82
InvitatHomes INVH 23.48
IonisPharma IONS 50.02
IronMountain IRM 37.10
IsraelChemicals ICL
4.08
ItauUnibanco ITUB 13.71
s
s
-0.16
0.47
-0.18 s
-0.70 s
0.20
0.73
0.34
0.15
1.25
0.17
-0.31
1.02
0.09
0.33
0.72 s
0.05
-0.20
0.56
-0.14
2.15
0.94
0.11
-2.38
-0.46
0.77
47.39
SHW
415.77
s
s
t
s
s
s
s
s
s
s
s
s
s
s
s
s
s
s
s
s
s
Net YTD
NAV Chg % Ret Fund
28.64
OakmrkInt
1.3 Old Westbury Fds
14.64
LrgCpStr
2.8 Oppenheimer Y
1.1 DevMktY
43.99
IntGrowY
44.12
NA Parnassus Fds
ParnEqFd
43.16
1.0 PIMCO Fds Instl
NA
AllAsset
1.0 TotRt
10.26
1.3 PIMCO Funds A
NA
IncomeFd
1.1 PIMCO Funds D
NA
IncomeFd
0.9 PIMCO Funds Instl
NA
IncomeFd
NA PIMCO Funds P
NA
IncomeP
1.5 Price Funds
97.69
BlChip
0.5 CapApp
28.35
EqInc
33.57
NA
72.31
EqIndex
Growth
63.48
NA
71.57
HelSci
InstlCapG
37.42
NA
18.87
IntlStk
NA
IntlValEq
15.26
NA
87.79
MCapGro
MCapVal
30.76
0.7
53.10
N Horiz
9.47
N Inc
0.9
11.42
OverS SF r
22.67
R2020
1.3
17.70
R2025
26.11
0.9 R2030
19.12
1.6 R2035
27.47
R2040
+0.01
+0.06
+0.21
+0.27
+0.18
...
+0.01
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
-0.27
-0.14
0.02
-0.13
-3.24
-1.94
0.94
2.02
-0.15
2.02
-0.49
11.18
0.03
-0.11
0.38
0.32
0.89
1.22
0.20
-0.10
2.89
0.67
-0.18
-0.17
1.52
-0.05
0.51
-0.08
3.20
0.55
0.70
2.02
37.53
...
0.2 Value
PRIMECAP Odyssey Fds
1.2 AggGrowth r 45.52 +0.52
38.26 +0.40
Growth r
2.4 Principal Investors
14.15 +0.09
DivIntlInst
1.1
Prudential Cl Z & I
14.55 +0.02
1.1 TRBdZ
Schwab Funds
41.80 +0.27
NA S&P Sel
-0.1 TIAA/CREF Funds
19.93 +0.11
EqIdxInst
NA IntlEqIdxInst 20.41 +0.09
Tweedy Browne Fds
28.59 +0.13
NA GblValue
VANGUARD ADMIRAL
250.47
+1.59
NA 500Adml
BalAdml
34.99 +0.14
11.79 +0.01
NA CAITAdml
CapOpAdml r 158.11 +1.78
39.18 +0.23
1.4 EMAdmr
78.53 +0.22
0.2 EqIncAdml
ExplrAdml
89.86 +0.49
0.7
85.74 +0.29
ExtndAdml
0.8
GNMAAdml 10.46 +0.01
1.3
73.91 +0.69
GrwthAdml
1.7
HlthCareAdml r 88.34 +0.46
1.4
HYCorAdml r 5.93 +0.01
1.1
25.56 +0.01
InfProAd
0.9
IntlGrAdml
98.00 +0.84
0.9
11.34 +0.01
ITBondAdml
1.2
ITIGradeAdml 9.73
...
1.0
-0.2 LTGradeAdml 10.57 +0.03
1.0 MidCpAdml 194.05 +1.14
92.73 +0.95
0.6 MorgAdml
11.45 +0.01
0.6 MuHYAdml
14.14 +0.01
0.7 MuIntAdml
11.68 +0.01
0.8 MuLTAdml
MuLtdAdml
10.89
...
0.8
52-Wk %
Sym Hi/Lo Chg Stock
136.60
0.6 W&T Offshore
WTI
UPS
126.69
2.2 WEX
WEX
144.17
WasteMgt
WM
WestRock
WRK
Wiley A
JW.A
WilliamLyonHomes WLH
WirelessTel
WTT
Wyndham
WYN
XPO Logistics
XPO
XinyuanRealEst XIN
87.54
26.92
TECK
27.00 -1.3 USBrentOilFd
TGP
20.85
TEX
48.92 -0.3 UnitedStatesOilFd USO
39.71
0.7 Terex
23.05
0.2 TexasInstruments TXN
0.2 TexasPacLand
13.58
2.4 TexasRoadhouse TXRH
SPLK
88.55
1.8 Textron
STO
22.44
1.9 Tiffany
STLD
45.85
STML
SF
TPL
108.51
6.5 UnitedRentals
URI
175.74
0.9
BNO
18.46
1.9
0.5 USDieselHeatingOil UHN
19.58
1.4
12.36
2.2
21.34
1.3
2.7 US12moOilFd
477.50 -1.6 UnitedTech
USL
UTX
56.24
4.3 UrbanOutfitters
URBN
TXT
57.80
0.6 UroGenPharma
URGN
TIF
108.19
0.6 Visa
V
1.7 TopBuild
BLD
76.60
1.1 Vale
16.15
2.2 TorontoDomBk
TD
59.36
62.09
1.9 ToyotaMotor
TM
130.24
6.24 -0.3 21stCenturyFoxA FOXA
65.53 -0.7 21stCenturyFoxB FOX
46.68 15.4
115.79
1.0
VALE
12.87
0.6
5.6 AXIS Capital
0.4 ValeantPharm
VRX
23.47
1.4 ValeroEnergy
VLO
93.47
1.9 Valvoline
VVV
36.24
1.6 VikingTherap
VKTX
6.9 VikingTheraWt
VKTXW
1.6 VinaConcha
VCO
37.85
0.6 21 Vianet
VNET
39.18
0.7 UBS Group
UBS
18.84
SNX
138.44
UNF
172.00
9.00
1.3 VMware
1.5
36.10 -0.6
36.89
SYF
0.7 Unifirst
130.20
VMW
38.77
s
s
s
s
s
s
AXS
1.1 BridgepointEduc BPI
2.2 CarlylePfdA
2.7
2.7
1.8
-0.2
1.5
1.4
1.2
0.4
1.5
0.8
0.1
2.9
2.6
0.7
1.6
1.2
...
2.2
1.9
0.2
-0.2
2.5
-0.2
-0.2
-0.7
1.3
2.2
0.1
0.1
0.1
...
66.00
s
s
s
s
s
s
s
2.54
TCGP
15.72
VANGUARD FDS
DivdGro
26.80
209.47
HlthCare r
INSTTRF2020 22.70
INSTTRF2025 23.07
INSTTRF2030 23.35
INSTTRF2035 23.64
INSTTRF2040 23.92
INSTTRF2045 24.11
40.43
IntlVal
20.07
LifeCon
LifeGro
34.07
27.37
LifeMod
27.49
PrmcpCor
31.68
SelValu r
STAR
27.08
STIGrade
10.63
15.42
TgtRe2015
31.62
TgtRe2020
18.66
TgtRe2025
TgtRe2030
33.97
20.92
TgtRe2035
36.22
TgtRe2040
+0.14
+1.10
+0.08
+0.09
+0.10
+0.11
+0.11
+0.12
+0.18
+0.06
+0.16
+0.10
+0.23
+0.13
+0.14
...
+0.05
+0.11
+0.07
+0.14
+0.09
+0.17
0.9
1.9
0.8
0.9
1.0
1.2
1.3
1.3
1.4
0.6
1.2
0.8
2.2
1.3
1.0
...
0.6
0.8
0.9
1.0
1.1
1.3
0.2
25.70
...
12.12 -9.1
33.24 -2.2
4.25 -3.4
7.89 -1.7
24.75
0.2
s
s
s
s
s
s
s
s
s
VLRS
CCT
OFC
DOGZ
GenworthFin
GNW
GolubCapital
GBDC
IconixBrand
ICON
InvRlEst
IRET
InVivoTherap
NVIV
LM Funding Wt LMFAW
MercuryGeneral MCY
NationalGrid
NGG
NaturalHlthTrends NHTC
0.03
-4.89
-0.12
0.42
1.13
-0.31
-0.01
0.68
0.57
-0.06
1.50
-0.91
0.29
0.28
-0.11
-0.04
15.49
4.17
0.12
0.69
0.43
-0.10
-0.07
0.76
-0.45
0.02
2.74
1.61
0.53
0.07
1.88
-1.85
2.32
6.65
-2.21
0.40
0.09
0.04
-0.64
1.14
2.14
0.08
1.22
0.49
0.69
0.33
0.31
1.21
0.36
1.43
-0.28
-1.10
-0.90
-1.24
-0.70
-0.30
0.05
2.74
-0.21
-0.22
-0.06
2.42
W X Y Z
s
WABCO
WBC 146.91
WEC Energy WEC 65.54
WEX
WEX 142.88
W.P.Carey
WPC 68.47
WPP
WPP 88.25
Wabtec
WAB 82.26
Wal-Mart
WMT 99.45
WalgreensBoots WBA 75.51
WasteConnections WCN 69.28
WasteMgt
WM 87.35
Waters
WAT 197.77
Watsco
WSO 170.29
Wayfair
W
78.45
Weibo
WB 115.09
WellCareHealth WCG 203.32
WellsFargo WFC 61.56
Welltower
HCN 64.14
WestPharmSvcs WST 99.62
WestarEnergy WR 52.32
WestAllianceBcp WAL 56.99
WesternDigital WDC 82.67
WesternGasEquity WGP 40.55
WesternGasPtrs WES 51.76
WesternUnion WU 19.07
WestlakeChem WLK 108.13
WestpacBanking WBK 24.54
WestRock
WRK 65.40
Weyerhaeuser WY 35.61
WheatonPrecMet WPM 22.15
Whirlpool
WHR 168.84
Williams
WMB 32.00
WilliamsPartners WPZ 40.48
WillisTowers WLTW 149.74
Wipro
WIT
5.67
WooriBank WF
45.20
Workday
WDAY 105.17
Wyndham
WYN 117.50
WynnResorts WYNN 162.52
XPO Logistics XPO 92.33
XcelEnergy XEL 47.49
Xerox
XRX 29.33
Xilinx
XLNX 69.24
Xylem
XYL 68.90
YPF
YPF 23.60
YY
YY 119.36
Yandex
YNDX 34.16
YumBrands YUM 81.53
YumChina
YUMC 42.24
ZTO Express ZTO 16.31
ZayoGroup ZAYO 36.37
Zillow C
Z
42.97
Zillow A
ZG
42.73
ZimmerBiomet ZBH 124.92
ZionsBancorp ZION 50.64
Zoetis
ZTS 72.10
TgtRe2045
TgtRe2050
TgtRetInc
TotIntBdIxInv
WellsI
Welltn
WndsrII
2.10
-0.23
0.84
0.09
-2.84
-0.67
0.86
0.56
-0.74
1.25
2.08
0.42
-2.57
1.92
0.77
0.47
0.11
0.12
-0.82
0.12
1.29
1.49
2.55
-0.01
-0.96
0.05
0.69
0.31
-0.15
0.85
0.86
0.87
2.75
-0.04
-0.32
1.77
0.66
-1.78
-0.16
-0.32
-0.04
1.36
0.83
-0.04
-2.10
0.52
-0.07
1.61
-0.11
0.02
0.49
0.43
0.86
-0.06
0.33
Net YTD
NAV Chg % Ret
22.80 +0.12
36.68 +0.18
13.61 +0.03
10.85 +0.02
27.00 +0.05
42.29 +0.10
38.38 +0.24
VANGUARD INDEX FDS
250.47 +1.59
500
ExtndIstPl
211.59 +0.71
57.49 +0.02
SmValAdml
TotBd2
10.70 +0.01
18.53 +0.09
TotIntl
TotSt
67.64 +0.39
VANGUARD INSTL FDS
BalInst
35.00 +0.14
DevMktsIndInst 14.62 +0.06
DevMktsInxInst 22.84 +0.09
85.74 +0.29
ExtndInst
GrwthInst
73.92 +0.70
10.41
...
InPrSeIn
247.06 +1.57
InstIdx
247.08 +1.57
InstPlus
InstTStPlus
60.31 +0.35
42.87 +0.25
MidCpInst
MidCpIstPl
211.42 +1.25
71.57 +0.20
SmCapInst
...
STIGradeInst 10.63
10.73 +0.01
TotBdInst
TotBdInst2
10.70 +0.01
10.73 +0.01
TotBdInstPl
TotIntBdIdxInst 32.54 +0.05
TotIntlInstIdx r 123.92 +0.55
TotItlInstPlId r 123.94 +0.55
67.68 +0.40
TotStInst
41.76 +0.15
ValueInst
Western Asset
NA
...
CorePlusBdI
52-Wk %
Sym Hi/Lo Chg Stock
EIX
93.98 -0.2 EllingtonFin
EFC
7.80 -3.5 EllingtonResiMtg EARN
48.16
s
Net
Sym Close Chg
TransCanada TRP 49.36
TransDigm
TDG 270.22
TransUnion TRU 54.73
Travelers
TRV 132.40
Trimble
TRMB 42.19
TurkcellIletism TKC 10.07
TurquoiseHill TRQ
3.55
21stCenturyFoxA FOXA 36.54
21stCenturyFoxB FOX 35.93
Twitter
TWTR 24.45
TylerTech
TYL 180.19
TysonFoods TSN 79.71
UBS Group UBS 18.79
UDR
UDR 38.34
UGI
UGI 47.37
US Foods
USFD 32.00
UltaBeauty ULTA 245.12
UltSoftware ULTI 222.12
UltraparPart UGP 23.69
UnderArmour A UAA 15.72
UnderArmour C UA
14.40
Unilever
UN
55.71
Unilever
UL
54.78
UnionPacific UNP 136.54
UnitedContinental UAL 68.49
UnitedMicro UMC 2.46
UPS B
UPS 126.41
UnitedRentals URI 175.19
US Bancorp USB 54.56
US Steel
X
37.49
UnitedTech UTX 130.04
UnitedTherap UTHR 150.09
UnitedHealth UNH 223.48
UnivDisplay OLED 180.40
UniversalHealthB UHS 113.39
UnumGroup UNM 55.26
VEON
VEON 3.99
VEREIT
VER
7.77
VF
VFC 73.78
Visa
V
115.65
VailResorts
MTN 212.59
Vale
VALE 12.85
ValeantPharm VRX 23.01
ValeroEnergy VLO 93.29
Vantiv
VNTV 74.32
VarianMed
VAR 111.31
Vedanta
VEDL 21.40
VeevaSystems VEEV 56.28
Ventas
VTR 60.12
VeriSign
VRSN 110.90
VeriskAnalytics VRSK 95.55
Verizon
VZ
52.43
VertxPharm VRTX 152.01
Viacom B
VIAB 29.95
Viacom A
VIA 34.05
Vipshop
VIPS 12.20
VistraEnergy VST 18.47
VMware
VMW 130.03
Vodafone
VOD 31.99
VornadoRealty VNO 77.10
VoyaFinancial VOYA 49.68
VulcanMatls VMC 134.29
Net YTD
NAV Chg % Ret Fund
0.1
2.5
-0.5
1.1
-0.1
...
-0.2
-0.1
1.5
1.4
1.3
0.9
1.4
0.2
0.6
1.3
3.7 Dogness
0.6 EdisonInt
s
s
s
...
+1.27
-0.22
+0.20
...
...
+0.01
+0.03
+0.14
+0.40
+0.06
+0.16
+0.43
+0.11
+0.17
+0.44
1.1 Volaris
Stock
1.57
0.43
1.61
0.01
0.34
0.21
-1.38
-0.43
1.41
0.69
1.00
0.01
0.84
-0.46
-0.39
0.23
-0.34 s
0.28
-0.02
-0.04
-0.25
1.91
-0.14
-0.07
-1.25
0.18
0.19 s
-3.28
0.02 s
2.86
0.33
3.54
0.01
0.25
-0.01
0.60
-0.41
2.10
0.26
0.02
0.26
0.57
0.30
1.76
0.57
PrmcpAdml r 136.98
REITAdml r 116.92
SmCapAdml 71.57
STBondAdml 10.37
STIGradeAdml 10.63
10.73
TotBdAdml
TotIntBdIdxAdm 21.68
TotIntlAdmIdx r 30.99
67.67
TotStAdml
14.60
TxMIn r
41.77
ValAdml
WdsrllAdml
68.09
65.40
WellsIAdml
73.02
WelltnAdml
79.97
WndsrAdml
66.95 -1.6 CorpCapitalTr
32.95 5.8 CorpOfficeProp
117.62
0.92
2.70
2.01
0.22
1.26
1.65
-0.50
0.31
0.44
0.29
3.51
0.88
-0.12
0.12
0.24
1.81
0.08
0.19
...
-0.08
0.04
0.48
0.29
2.79
-0.06
-0.03
0.51
1.18
...
1.66
0.22
-0.96
2.26
2.67
-0.80
...
0.28
1.50
0.37
-0.07
-0.32
0.36
-1.70
-0.08
0.51
-0.27
0.09
-1.38
0.83
9.58
-0.34
1.53
-0.03
1.14
0.62
1.08
0.71
0.41
0.75
-0.93
-1.17
0.55
0.89
0.06
0.06
-0.02
0.21
0.82
...
0.26
-0.02
1.03
0.13
T U V
TAL Education TAL 31.84
TD Ameritrade AMTD 52.12
TE Connectivity TEL 96.93
Telus
TU
37.85
Ternium
TX
33.02
TIM Part
TSU 20.31
TJX
TJX 75.31
T-MobileUS TMUS 63.61
TRowePrice TROW 104.49
TaiwanSemi TSM 41.71
TakeTwoSoftware TTWO 113.88
Tapestry
TPR 45.27
TargaResources TRGP 49.93
Target
TGT 67.17
TataMotors TTM 33.93
TechnipFMC FTI
32.09
TeckRscsB
TECK 26.59
TelecomArgentina TEO 37.54
TelecomItalia TI
8.77
TelecomItalia A TI.A
7.30
TeledyneTech TDY 184.09
Teleflex
TFX 256.64
TelefonicaBras VIV 15.04
Telefonica
TEF
9.77
TelekmIndonesia TLK 31.21
Tenaris
TS
32.51
Teradyne
TER 44.37
Tesla
TSLA 317.25
TevaPharm TEVA 19.13
TexasInstruments TXN 108.43
Textron
TXT 57.63
ThermoFisherSci TMO 196.52
ThomsonReuters TRI
43.77
ThorIndustries THO 155.61
3M
MMM 235.63
Tiffany
TIF 107.03
TimeWarner TWX 91.50
Toll Bros
TOL 50.42
Torchmark
TMK 90.47
Toro
TTC 65.43
TorontoDomBk TD
59.17
Total
TOT 56.44
TotalSystem TSS 78.78
ToyotaMotor TM 130.13
TractorSupply TSCO 76.25
0.6 MuShtAdml
Lows
0.5 Allstate PfdC
ALLpC
25.38 -0.1 AmerOutdoor
AOBC
4.84 7.8 AssuredGuaranty AGO
3.37 12.7 Aware
AWRE
130.99
s
4.30 11.8 CitigroupPfdAA CpP
0.6 ColonyNorthStar CLNS
1.5 EngGr-Cmg C
CIG.C
UNP
5.8 UPS B
TMHC
s
52-Wk %
Sym Hi/Lo Chg Stock
1.0 UnionPacific
3.0 TaylorMorrison
s
SAP
SAP 113.31
S&P Global SPGI 170.82
SBA Comm SBAC 162.64
SEI Investments SEIC 72.06
Sina
SINA 109.69
SINOPEC
SHI
59.73
SK Telecom SKM 27.58
SLGreenRealty SLG 100.95
SS&C Tech SSNC 41.05
SVB Fin
SIVB 237.67
SageTherap SAGE 170.17
Salesforce.com CRM 105.29
Sanofi
SNY 43.20
SantanderCons SC
18.51
Sasol
SSL 34.48
Schlumberger SLB 71.33
SchwabC
SCHW 51.52
ScottsMiracleGro SMG 108.66
ScrippsNetworks SNI
86.64
Seagate
STX 42.85
SealedAir
SEE 49.46
SeattleGenetics SGEN 56.61
SemicondctrMfg SMI
8.33
SempraEnergy SRE 108.14
SensataTech ST
51.48
ServiceCorp SCI
37.68
ServiceMaster SERV 51.56
ServiceNow NOW 132.91
ShawComm B SJR 22.84
SherwinWilliams SHW 415.36
ShinhanFin SHG 47.02
Shire
SHPG 158.25
Shopify
SHOP 107.75
SignatureBank SBNY 140.67
SimonProperty SPG 171.62
SiriusXM
SIRI
5.21
SkechersUSA SKX 38.73
Skyworks
SWKS 99.93
SmithAO
AOS 61.90
Smith&Nephew SNN 34.83
Smucker
SJM 123.40
Snap
SNAP 15.31
SnapOn
SNA 175.19
SOQUIMICH SQM 61.42
Sony
SNE 46.30
Southern
SO
46.90
SoCopper
SCCO 48.99
SouthwestAir LUV 64.91
SpectraEnerPtrs SEP 42.15
SpectrumBrands SPB 118.94
SpiritAeroSys SPR 87.04
Splunk
SPLK 88.16
Sprint
S
5.90
Square
SQ
37.31
StanleyBlackDck SWK 169.13
Starbucks
SBUX 58.71
StateStreet STT 97.43
Statoil
STO 22.41
SteelDynamics STLD 45.61
Stericycle
SRCL 67.63
Steris
STE 87.14
STMicroelec STM 22.95
Stryker
SYK 158.79
SumitomoMits SMFG 8.83
SunComms SUI
91.76
SunLifeFinancial SLF 41.10
SuncorEnergy SU
37.65
SunTrustBanks STI
65.68
Symantec
SYMC 28.91
SynchronyFin SYF 39.12
Syngenta
SYT 92.86
Synopsys
SNPS 87.06
Sysco
SYY 60.63
Net YTD
NAV Chg % Ret Fund
19.15
0.5 TeekayLNG un
s
R S
RELX
RENX 22.80
RELX
RELX 23.51
RPM
RPM 53.47
RSP Permian RSPP 41.48
RalphLauren RL 101.64
RandgoldRscs GOLD 98.78
RaymondJames RJF 89.80
Raytheon
RTN 188.30
RealtyIncome O
56.47
RedHat
RHT 123.06
RegencyCtrs REG 69.05
RegenPharm REGN 393.78
RegionsFin RF
17.40
ReinsGrp
RGA 155.26
RelianceSteel RS
88.27
RepublicSvcs RSG 66.90
ResMed
RMD 86.42
RestaurantBrands QSR 63.66
RioTinto
RIO 54.95
RobertHalf RHI 55.81
Rockwell
ROK 200.55
RockwellCollins COL 136.55
RogersComm B RCI
50.26
Rollins
ROL 46.48
RoperTech
ROP 262.08
RossStores ROST 80.45
RoyalBkCanada RY
82.84
RoyalBkScotland RBS
7.59
RoyalCaribbean RCL 123.58
RoyalDutchA RDS.A 68.59
RoyalDutchB RDS.B 70.14
Ryanair
RYAAY 107.27
20.45
49.06
SU
s
1.92
-0.18
0.31
1.94
-0.96
-0.98
1.95
-0.01
0.34
0.02
0.29
1.43
3.41
-2.69
2.70
1.05
2.50
0.69
0.19
1.91
-0.37
0.71
0.86
0.24
-0.73
-2.24
1.71
-0.69
6.70
-0.08
0.32
5.44
-0.23
0.22
1.36
1.31
0.68
0.40
-0.11
0.78
0.06
0.04
0.07
-0.86
-0.79
0.17
0.48
0.41
2.73
0.14
-0.24
-0.64
0.03
-0.02
0.07
33.22
0.13
0.92
-1.18
1.05
-0.36
0.21
1.50
-6.38
3.98
3.68
3.78
0.09
0.19
0.20
-0.32
0.10
0.06
-3.29
-0.67
-0.01
s
TPH
LOV
SNHY
s
52-Wk %
Sym Hi/Lo Chg Stock
SCCO
STB
s
M&T Bank
MTB 173.11
MGM Resorts MGM 33.33
MPLX
MPLX 36.35
MSCI
MSCI 129.62
Macerich
MAC 65.65
Macy's
M
25.33
MagellanMid MMP 72.96
MagnaIntl
MGA 57.15
Manpower
MAN 127.09
ManulifeFin MFC 20.87
MarathonOil MRO 17.67
MarathonPetrol MPC 68.61
Markel
MKL 1119.72
MarketAxess MKTX 200.94
Marriott
MAR 136.45
Marsh&McLen MMC 81.45
MartinMarietta MLM 227.50
MarvellTech MRVL 22.89
Masco
MAS 44.00
Mastercard MA 153.82
MatchGroup MTCH 32.01
MaximIntProducts MXIM 53.68
McCormickVtg MKC.V 101.07
McCormick MKC 101.47
McDonalds MCD 172.49
McKesson
MCK 156.76
Medtronic
MDT 83.92
MelcoResorts MLCO 27.51
MercadoLibre MELI 329.28
Merck
MRK 56.14
MetLife
MET 50.50
MettlerToledo MTD 631.54
MichaelKors KORS 63.80
MicroFocus MFGP 33.86
MicrochipTech MCHP 91.77
MicronTech MU
44.98
Microsemi
MSCC 53.85
Microsoft
MSFT 86.35
MidAmApt MAA 99.49
Middleby
MIDD 136.06
MitsubishiUFJ MTU 7.41
MizuhoFin
MFG 3.70
MobileTeleSys MBT 10.44
MohawkInds MHK 275.14
MolsonCoors B TAP 81.45
Mondelez
MDLZ 42.58
Monsanto
MON 118.00
MonsterBev MNST 63.12
Moody's
MCO 148.86
MorganStanley MS
52.33
Mosaic
MOS 26.41
MotorolaSol MSI 89.91
Mylan
MYL 43.14
NRG Energy NRG 28.88
NTTDoCoMo DCM 23.93
NVR
NVR 3562.83
NXP Semi
NXPI 118.08
Nasdaq
NDAQ 77.66
NationalGrid NGG 57.66
NatlOilwell
NOV 37.85
NatlRetailProp NNN 42.56
NektarTherap NKTR 57.86
NetApp
NTAP 57.07
Netease
NTES 341.99
Netflix
NFLX 205.05
Neurocrine
NBIX 82.98
NewOrientalEduc EDU 101.57
NY CmntyBcp NYCB 13.16
NewellBrands NWL 31.83
NewfieldExpln NFX 33.10
NewmontMin NEM 37.84
NewsCorp B NWS 16.90
NewsCorp A NWSA 16.49
NextEraEnergy NEE 151.80
NielsenHoldings NLSN 35.99
Nike
NKE 63.48
s
s
s
-0.01
0.89
4.58
1.02
0.14
0.79
-2.41
0.97
-0.43
1.08
-0.18
-0.08
1.36
-0.14
1.84
-0.72
-0.49
-0.03
2.79
0.19
0.07
0.78
0.24
0.89
2.37
-0.19
1.13
0.09
1.63
0.32
0.97
2.91
-0.03
-0.02
0.57
-0.08
-0.31
2.25
-0.25
-0.33
0.27
0.23
0.27
-0.13
0.68
-0.47
-0.47
-0.77
3.42
0.98
0.67
2.12
1.31
39.41
0.15
-0.11
-0.03
-0.12
0.04
-0.02
-0.26
0.45
0.90
0.57
-0.49
0.74
0.31
0.35
TSU
55.69 -0.3 TeckRscsB
SOI
M N
O P Q
OGE Energy OGE 32.66
ONEOK
OKE 55.54
OReillyAuto ORLY 253.84
OccidentalPetrol OXY 75.00
OldDomFreight ODFL 134.58
Olin
OLN 37.41
Omnicom
OMC 70.36
ON Semi
ON
22.78
OpenText
OTEX 34.38
Oracle
ORCL 47.71
Orange
ORAN 17.40
OrbitalATK OA 131.69
Orix
IX
86.56
Oshkosh
OSK 92.03
OwensCorning OC
94.06
PG&E
PCG 43.77
PLDT
PHI
29.87
PNC Fin
PNC 144.59
POSCO
PKX 85.14
PPG Ind
PPG 118.19
PPL
PPL 30.67
PTC
PTC 61.94
PVH
PVH 139.21
Paccar
PCAR 73.91
PackagingCpAm PKG 125.98
PacWestBancorp PACW 50.25
PaloAltoNtwks PANW 149.68
ParkHotels
PK
28.94
ParkerHannifin PH 201.51
ParsleyEnergy PE
30.79
Paychex
PAYX 68.28
PayPal
PYPL 76.75
Pearson
PSO
9.88
PembinaPipeline PBA 36.54
Pentair
PNR 70.80
People'sUtdFin PBCT 18.72
PepsiCo
PEP 117.75
PerkinElmer PKI
76.16
Perrigo
PRGO 89.44
PetroChina PTR 71.67
PetroleoBrasil PBR 10.97
PetroleoBrasilA PBR.A 10.45
Pfizer
PFE 36.71
PhilipMorris PM 104.26
Phillips66
PSX 102.43
PilgrimPride PPC 29.71
PinnacleFoods PF
58.53
PinnacleWest PNW 83.12
PioneerNatRscs PXD 176.34
PlainsAllAmPipe PAA 22.27
PlainsGP
PAGP 23.17
PolarisIndustries PII 128.36
Praxair
PX 157.50
Priceline
PCLN 1824.16
PrincipalFin PFG 70.53
Procter&Gamble PG
90.54
Progressive PGR 55.33
Prologis
PLD 63.89
PrudentialFin PRU 115.49
Prudential
PUK 50.93
PublicServiceEnt PEG 50.74
PublicStorage PSA 206.77
PulteGroup PHM 34.27
Qiagen
QGEN 31.93
Qorvo
QRVO 68.39
Qualcomm
QCOM 65.94
QuantaServices PWR 39.55
QuestDiag
DGX 99.25
Net
Sym Close Chg
Stock
NiSource
NI
25.20 -0.16
NobleEnergy NBL 31.01 0.82
Nokia
NOK
4.83 0.07
NomuraHoldings NMR 5.99 0.09
Nordson
NDSN 149.12 1.70
Nordstrom
JWN 48.65 -0.47
s NorfolkSouthern NSC 146.97 0.01
NorthernTrust NTRS 100.05 0.59
NorthropGrum NOC 306.65 1.41
NorwegCruise NCLH 55.37 0.41
Novartis
NVS 85.34 0.66
s NovoNordisk NVO 54.68 0.52
s Nucor
NUE 67.39 0.87
Nutanix
NTNX 36.77 0.82
NVIDIA
NVDA 212.47 13.12 s
0.4 TRI Pointe
77.95
SKX
0.21
0.97
0.75
3.22
-0.57
0.69
-0.78
1.48
1.28
-0.24
-0.08
2.39
2.22
3.85
-0.09
1.09
1.19
0.04
-0.03
0.76
1.51
-0.60
-0.47
0.19
0.30
-0.10
-0.08
-0.16
0.46
0.23
-0.36
-0.12
-0.38
-0.14
-0.05
2.67
0.58
0.54
0.55
0.40
-1.10
0.03
Net
Sym Close Chg
Stock
7.8 TIM Part
SIMO
8.51
s LKQ
LKQ 41.56
L3 Tech
LLL 199.24
LabCpAm
LH 163.05
LamResearch LRCX 192.50
LamarAdv
LAMR 72.27
LambWeston LW
56.06
LasVegasSands LVS 68.32
s Lazard
LAZ 54.08
Lear
LEA 180.08
Leggett&Platt LEG 47.62
Leidos
LDOS 63.92
s Lennar A
LEN 67.23
s Lennar B
LEN.B 54.83
LennoxIntl
LII
210.98
LeucadiaNatl LUK 26.69
LibertyBroadbandC LBRDK 89.63
LibertyBroadbandA LBRDA 89.49
LibertyGlobal C LBTYK 34.26
LibertyGlobal A LBTYA 36.21
LibertyQVC A QVCA 25.48
LibertyVenturesA LVNTA 57.78
LibertyFormOne C FWONK 34.21
LibertyFormOne A FWONA 32.56
LibertyBraves A BATRA 22.37
LibertyBraves C BATRK 22.56
LibertySirius C LSXMK 38.64
LibertySirius A LSXMA 38.82
LibertyProperty LPT 42.45
EliLilly
LLY
85.14
LincolnElectric LECO 92.39
LincolnNational LNC 77.55
LionsGate B LGF.B 30.58
LionsGate A LGF.A 32.63
LiveNationEnt LYV 42.51
LloydsBanking LYG
3.73
LockheedMartin LMT 321.21
Loews
L
50.47
LogitechIntl LOGI 34.25
LogMeIn
LOGM 116.20
Lowe's
LOW 92.02
lululemon
LULU 78.59
s LyondellBasell LYB 112.26
Net YTD
NAV Chg % Ret Fund
1.2 FrankTemp/Temp Adv
1.4 GlBondAdv p 12.00 +0.08
1.4 Harbor Funds
71.39 +0.77
CapApInst
68.28 +0.24
1.1 IntlInst r
Harding
Loevner
2.6
NA
...
2.1 IntlEq
2.2 Invesco Funds A
11.07 +0.05
0.8 EqIncA
1.0 John Hancock Class 1
15.34 +0.06
2.8 LSBalncd
16.29 +0.07
2.8 LSGwth
John
Hancock
Instl
-0.1
23.57 +0.13
-0.2 DispValMCI
1.1 JPMorgan Funds
40.64 +0.13
1.1 MdCpVal L
JPMorgan R Class
2.0
NA
...
CoreBond
2.7
Lazard Instl
1.2
20.33 +0.03
EmgMktEq
2.6
Loomis Sayles Fds
2.8
13.83 +0.03
LSBondI
1.1
Lord Abbett A
1.1
ShtDurIncmA p
NA
...
-0.1
Lord Abbett F
ShtDurIncm
NA
...
1.0
Metropolitan West
NA
...
TotRetBd
1.1
NA
...
TotRetBdI
NA
...
TRBdPlan
0.9 MFS Funds Class I
41.08 +0.19
ValueI
... MFS Funds Instl
0.8 IntlEq
25.68 +0.13
1.5 Mutual Series
GlbDiscA
32.22 +0.20
0.8 Oakmark Funds Invest
EqtyInc r
32.48 +0.15
1.3 Oakmark
85.71 +0.55
1.7
SILC
SPIL
0.23
0.11
0.15
0.23
0.20
0.05
1.53
-0.79
1.33
0.73
0.77
0.11
0.22
0.01
0.46
1.24
-0.18
-0.07
-0.32
0.07
0.60
-0.05
-1.99
-0.12
0.16
0.35
-0.69
0.24
-0.16
-0.01
-0.45
0.94
-0.16
-1.73
0.37
0.51
Net
Sym Close Chg
Stock
J K L
52-Wk %
Sym Hi/Lo Chg Stock
SHAK
-1.48
-0.58
-0.05
0.06
1.38
0.15
-0.29
...
0.08
-2.47
-0.01
-0.99
0.02
0.05
-0.26
0.89
-0.27
-1.96
0.75
-0.44
-0.79
0.13
-0.20
0.10
0.30
0.67
-0.29
-0.47
1.55
0.09
1.17
0.08
0.62
0.98
0.31
-1.27
-0.36
1.80
-0.07
0.49
-0.86
-0.36
0.78
0.12
1.38
0.40
0.89
3.35
-0.02
4.24
-0.34
0.12
0.18
10.90
-0.24
0.26
0.34
-0.46
1.19
0.69
6.29
0.04
0.09
-0.14
1.20
-1.84
-1.59
-0.40
1.06
-0.25
4.24
1.18
0.79
-0.49
0.44
8.57
-0.01
0.77
-0.51
0.01
0.18
JD.com
JD
43.51
JPMorganChase JPM 108.06
JackHenry
JKHY 116.34
JacobsEngg JEC 67.10
JamesHardie JHX 17.95
JanusHenderson JHG 38.64
JazzPharma JAZZ 138.93
JetBlue
JBLU 21.59
J&J
JNJ 140.56
JohnsonControls JCI
38.96
JonesLang
JLL 154.71
JuniperNetworks JNPR 28.81
KAR Auction KAR 51.17
KB Fin
KB
59.33
KKR
KKR 21.97
KLA Tencor KLAC 107.37
KT
KT
15.58
KSCitySouthern KSU 107.09
Kellogg
K
67.65
KeyCorp
KEY 20.24
KeysightTechs KEYS 42.75
KilroyRealty KRC 74.22
KimberlyClark KMB 117.08
KimcoRealty KIM 18.00
KinderMorgan KMI 18.96
Knight-Swift KNX 44.94
Kohl's
KSS 55.66
KoninklijkePhil PHG 38.01
KoreaElcPwr KEP 17.67
KraftHeinz
KHC 77.01
Kroger
KR
27.85
Kyocera
KYO 66.91
LATAMAirlines LTM 14.27
L Brands
LB
58.16
LG Display
LPL 14.48
LINE
LN
41.83
Net YTD
NAV Chg % Ret Fund
Fidelity Invest
Net YTD
NAV Chg % Ret
0.17
-0.07
-0.67
-3.09
4.72
-0.02
-0.41
0.82
1.15
0.05
-0.69
-0.26
-0.08
0.48
0.14
1.63
0.31
1.50
0.80
4.04
-0.39
1.08
2.78
0.38
1.16
0.87
0.75
-0.50
3.01
-1.28
0.30
0.65
0.48
0.27
0.08
-0.11
-0.11
-0.26
0.08
0.28
-0.91
0.75
0.62
2.06
-0.26
0.33
0.02
2.46
2.03
3.30
-0.56
0.35
-0.53
3.75
0.09
0.43
0.18
1.67
1.46
1.23
3.25
1.61
0.02
-0.50
3.22
2.02
0.76
-0.24
1.37
0.55
0.09
0.35
0.76
-0.03
2.85
-0.63
-0.44
1.06
1.09
0.18
0.37
0.77
-0.95
0.10
-0.27
0.68
-0.41
0.04
0.81
-1.66
0.20
-0.30
0.30
Net
Sym Close Chg
Stock
G H I
GGP
GGP 23.58
Gallagher
AJG 62.64
Gaming&Leisure GLPI 36.44
Gap
GPS 33.17
GardnerDenver GDI 33.91
Garmin
GRMN 60.27
Gartner
IT
125.19
Gazit-Globe GZT 10.92
GeneralDynamics GD 201.74
GeneralElec GE
18.15
GeneralMills GIS
58.73
GeneralMotors GM
42.82
Genpact
G
32.48
Gentex
GNTX 21.46
GenuineParts GPC 97.30
Gerdau
GGB
3.99
Gildan
GIL
32.09
GileadSciences GILD 74.66
GSK
GSK 36.79
GlobalPayments GPN 101.71
GoDaddy
GDDY 50.01
Goldcorp
GG
13.33
GoldmanSachs GS 253.29
Goodyear
GT
31.86
s Graco
GGG 45.91
Freedom2030 K 18.25 +0.09
Freedom2035 K 15.42 +0.08
Freedom2040 K 10.84 +0.06
Top 250 mutual-funds listings based on total net assets for Nasdaq-published share classes.
NAV is net asset value. Percentage performance figures are total returns, assuming
reinvestment of all distributions and after subtracting annual expenses. Figures don’t reflect
sales charges (“loads”) or redemption fees. NET CHG is change in NAV from previous trading
day. YTD%RET is year-to-date return. f-Previous day’s quotation. p-Distribution costs apply,
12b-1. r-Redemption charge may apply. t-Footnotes p and r apply. NA-Not available due to
incomplete price, performance or cost data. NE-Not released by Lipper; data under review. NNFund not tracked. NS-Fund didn’t exist at start of period.
American Century Inv
44.43
Ultra
American Funds Cl A
32.14
AmcpA p
AMutlA p
41.21
27.34
BalA p
12.87
BondA p
63.08
CapIBA p
51.94
CapWGrA
EupacA p
57.29
63.18
FdInvA p
50.58
GwthA p
10.41
HI TrA p
40.93
ICAA p
IncoA p
23.48
44.03
N PerA p
45.79
NEcoA p
68.15
NwWrldA
56.58
SmCpA p
TxExA p
13.05
46.10
WshA p
Baird Funds
10.86
AggBdInst
11.21
CorBdInst
BlackRock Funds A
s DolbyLab
DLB 63.21
DollarGeneral DG
93.99
DollarTree
DLTR 108.02
DominionEner D
77.19
Domino's
DPZ 191.66
Donaldson
DCI
48.94
DouglasEmmett DEI
40.67
s Dover
DOV 102.51
DowDuPont DWDP 73.05
DrPepperSnap DPS 95.32
DrReddy'sLab RDY 37.40
DukeEnergy DUK 82.97
DukeRealty DRE 26.81
s Dunkin'
DNKN 66.03
ENI
E
33.75
s EOG Rscs
EOG 110.93
EQT
EQT 58.93
EQT Midstream EQM 75.35
s E*TRADE
ETFC 50.62
EXACT Sci EXAS 55.83
EastWestBncp EWBC 60.93
s EastmanChem EMN 95.35
Eaton
ETN 81.64
EatonVance EV
57.15
s eBay
EBAY 39.22
Ecolab
ECL 135.37
s Ecopetrol
EC
16.14
t EdisonInt
EIX
62.75
EdwardsLife EW 114.59
ElbitSystems ESLT 134.51
ElectronicArts EA 109.75
s EmersonElec EMR 71.39
EnbridgeEnPtrs EEP 14.73
Enbridge
ENB 40.41
s Encana
ECA 13.80
s EnelAmericas ENIA 11.28
EnelChile
ENIC 5.95
EnelGenChile EOCC 27.06
EnergyTransferEq ETE 17.82
EnergyTransfer ETP 18.88
Entergy
ETR 81.69
EnterpriseProd EPD 27.63
Equifax
EFX 120.16
Equinix
EQIX 448.98
EquityLife
ELS 88.13
EquityResdntl EQR 63.84
Ericsson
ERIC 6.70
EssexProp
ESS 242.54
EsteeLauder EL 129.62
EverestRe
RE 219.77
EversourceEner ES
62.59
Exelixis
EXEL 31.75
Exelon
EXC 39.06
Expedia
EXPE 125.17
ExpeditorsIntl EXPD 65.07
ExpressScripts ESRX 75.66
ExtraSpaceSt EXR 85.86
ExxonMobil XOM 86.70
F5Networks FFIV 134.04
s FMC
FMC 96.96
s Facebook
FB 184.67
FactSet
FDS 193.24
Fastenal
FAST 54.56
FederalRealty FRT 133.25
s FedEx
FDX 260.82
Ferrari
RACE 107.17
s FiatChrysler FCAU 19.19
FibriaCelulose FBR 14.54
FidNatlFin
FNF 39.84
FidNatlInfo FIS
94.25
FifthThirdBncp FITB 30.52
58.com
WUBA 76.61
FirstAmerFin FAF 56.62
FirstData
FDC 16.62
FirstRepBank FRC 87.81
FirstSolar
FSLR 69.80
FirstEnergy FE
30.38
Fiserv
FISV 131.41
FleetCorTech FLT 194.96
Flex
FLEX 18.41
FlirSystems FLIR 47.48
Fluor
FLR 53.10
FomentoEconMex FMX 95.39
FordMotor
F
12.76
ForestCIty A FCE.A 23.73
Fortinet
FTNT 45.03
Fortis
FTS 35.98
Fortive
FTV 72.42
FortBrandsHome FBHS 69.55
Franco-Nevada FNV 77.85
FranklinRscs BEN 43.45
s FreeportMcM FCX 19.47
FreseniusMed FMS 52.64
Fund
Data provided by
Wednesday, January 3, 2018
Net YTD
Net YTD
NAV Chg % Ret Fund
NAV Chg % Ret Fund
Net
Sym Close Chg
Stock
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.
1.3
1.3
0.4
...
0.2
0.6
1.5
1.5
1.2
0.8
-0.2
1.6
1.4
0.8
1.3
1.2
1.2
2.2
-0.2
1.5
1.5
1.4
1.3
1.3
1.1
...
-0.2
-0.2
-0.2
-0.1
1.5
1.5
1.4
0.8
NA
52-Wk %
Sym Hi/Lo Chg
9.03 -2.1
ORC
15.07 -1.1
11.02 -2.6 OwensRealtyMtg ORM
9.25 -3.1
PCM
PCMI
1.83 7.0
9.15 -0.5
PCYG
7.93 0.9 ParkCity
120.23 -0.2
RNR
15.65 1.1 RenaissanceRe
6.02 -6.0
SLS
28.79 -1.0 SellasLifeSci
11.50 -3.2
scPharm
SCPH
5.46 1.6
0.95 0.5
SkylineMedical SKLN
62.35 -0.8
30.69 -1.2
SoJerseyInd
SJI
14.45 -0.2
21.03 -0.7
StarwoodProp
STWD
11.39 -3.7
74.35 0.8
TESARO
TSRO
3.01 -5.6
14.58 -1.2
TFS Fin
TFSL
17.95 -0.6
14.23
...
TremontMortgage TRMT
1.16 -4.8
US BancorpPfdF USBpM 27.80 0.1
5.53 -1.9 USCellularNts64 UZC
25.35 -0.1
0.60 -21.4 US ShortOilFd
55.30 -2.3
DNO
0.03 68.0 WaterstoneFinl WSBF
16.90 -1.2
51.68 -0.5 WheelerREITPfdD WHLRD 18.91 -1.2
57.55 -2.0 XL Group
33.77 1.2
XL
14.60 -7.2 YatraOnline
7.25 -1.4
YTRA
25.43 -2.8 OrchidIslandCap
.
THE WALL STREET JOURNAL.
B10 | Thursday, January 4, 2018
MARKETS DIGEST
EQUITIES
S&P 500 Index
Dow Jones Industrial Average
Last Year ago
24922.68 s 98.67, or 0.40%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio 21.95 21.74
P/E estimate *
19.77 18.59
Dividend yield
2.09
2.39
All-time high 24922.68, 01/03/18
Nasdaq Composite Index
Last
2713.06 s 17.25, or 0.64%
High, low, open and close for each
trading day of the past three months.
Year ago
Trailing P/E ratio 21.81 24.82
P/E estimate *
20.02 18.92
Dividend yield
1.89
2.07
All-time high: 2713.06, 01/03/18
Last Year ago
7065.53 s 58.63, or 0.84%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio * 26.62
24.22
P/E estimate *
21.48
19.42
Dividend yield
1.05
1.22
All-time high: 7065.53, 01/03/18
Current divisor 0.14523396877348
Session high
t
DOWN
Session open
t
Close
UP
Close
25200
2700
7000
24500
2650
6875
23800
2600
6750
23100
2550
6625
22400
2500
Open
Session low
65-day moving average
65-day moving average
6500
65-day moving average
6375
2450
21700
Bars measure the point change from session's open
Oct.
Nov.
Sept.
Dec.
6250
2400
21000
Sept.
Oct.
Nov.
Oct.
Sept.
Dec.
Nov.
Dec.
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
3-yr. ann.
YTD
Dow Jones
24941.92 24825.55 24922.68
98.67
0.40
24922.68 19732.40
25.0
0.8
Transportation Avg 10843.17 10746.31 10820.74
10.78
0.10
10820.74
8783.74
18.7
2.0
5.9
774.47
651.14
7.2
-2.3
4.4
28065.91 23526.88
721.47
600.24
18.7
17.5
1.4
1.5
9.4
10.2
Industrial Average
716.04
Utility Average
Total Stock Market
Barron's 400
704.18
706.52
-9.20
-1.29
28078.55 27927.24 28065.91 163.58
722.24
718.40
3.22
721.47
Nasdaq Stock Market
Nasdaq Composite
7069.15
Nasdaq 100
6579.25
7016.70
6519.26
7065.53
6575.80
0.59
0.45
58.63
64.46
0.84
0.99
7065.53
6575.80
5477.00
4937.20
11.8
2.3
2.8
29.0
33.2
14.3
15.8
S&P
500 Index
2714.37
2697.77
2713.06
17.25
0.64
2713.06
2263.69
19.5
1.5
9.6
MidCap 400
SmallCap 600
1925.78
945.79
1916.68
939.72
1923.36
943.24
6.00
0.27
0.31
0.03
1923.36
945.12
1667.44
815.62
13.4
10.0
1.2
0.7
9.8
11.0
Other Indexes
Russell 2000
1555.08
1547.59
1552.58
2.56
0.17
1552.58
1345.24
11.9
1.1
9.0
54.55
0.42
570.20
567.91
569.77
1.86
0.33
NYSE Arca Biotech
4387.41
4321.00
4374.04
51.93
NYSE Arca Pharma
553.65
549.17
553.25
2.98
KBW Bank
107.78
106.87
0.56
PHLX§ Gold/Silver
107.67
88.26
85.91
-1.05
PHLX§ Oil Service
87.08
155.06
149.98
154.21
3.64
1310.37
9.65
1291.29
8.94
1309.86
9.15
Value Line
PHLX§ Semiconductor
Cboe Volatility
12963.39 12906.99 12957.28
Volume, Advancers, Decliners
12957.28 11148.85
Most-active issues in late trading
Company
Volume
(000)
Symbol
SPDR S&P 500
SPY
Last
Net chg
18,452.1 270.22
After Hours
% chg
High
-0.25
Cnsmr Staples Sel Sector XLP
6,033.9
56.59
0.07
0.12
56.59
56.52
iShares MSCI Emg Markets EEM
4,949.0
48.46
-0.01
-0.02
48.53
48.38
-0.29
76.54
76.31
Industrial Select Sector XLI
4,756.3
76.31
-0.22
iShares Russell 2000 ETF IWM
3,238.3 154.15
0.09
Cisco Systems
CSCO
3,105.9
39.20
0.03
0.08
39.20
38.98
Intel
INTC
3,077.4
44.78
-0.48
-1.06
45.66
44.10
Ford Motor
F
3,032.5
12.74
-0.02
-0.16
12.78
12.74
0.06 154.36 153.99
Percentage gainers…
ZUMZ
54.5
23.65
3.15
15.37
24.00
20.50
Ampio Pharmaceuticals AMPE
62.4
3.22
0.21
6.98
3.24
3.08
Diana Containerships
DCIX
64.3
4.28
0.27
6.73
4.33
3.97
Momenta Pharm
MNTA
41.4
15.00
0.85
6.01
16.35
14.15
Sandstorm Gold
SAND
91.3
5.16
0.17
3.41
5.25
4.91
GXP
30.05
15.2
1.2
6.2
10.0
1.3
4.4
4374.04
3134.03
35.2
3.6
8.2
0.54
560.52
469.13
13.1
1.5
1.2
0.52
108.12
88.02
14.9
0.9
13.3
20.6
30.05
-1.55
-4.91
31.77
96.72
76.42
4.4
2.1
7.3
China HGS Real Estate HGSH
27.5
2.34
-0.11
-4.49
3.34
2.34
192.66
117.79
-18.7
3.1
-9.9
Plains All Amer Pipeline PAA
11.1
21.29
-0.98
-4.40
22.27
21.29
1.20
-1.19
2.42
22.16
-0.62 -6.35
1.72
1341.69
16.04
901.69 44.0
9.14 -22.8
4.5 24.0
-17.1 -19.9
...And losers
Great Plains Energy
B2Gold
BTG
255.3
2.90
-0.13
-4.29
3.03
2.90
SeaChange Intl
SEAC
490.0
3.80
-0.16
-4.04
3.80
3.80
Sources: SIX Financial Information; WSJ Market Data Group
Region/Country Index
Close
Percentage Gainers...
Net chg
Latest
% chg
YTD
% chg
3124.12
401.86
269.12
10.59
1.73
0.69
0.34
0.43
0.26
1.2
1.2
0.9
DJ Americas
651.68
Sao Paulo Bovespa 77995.16
S&P/TSX Comp
16371.55
S&P/BMV IPC
49782.23
Santiago IPSA
4249.31
3.75
104.13
61.56
–251.72
–1.84
0.58
0.13
0.38
1.5
2.1
1.0
0.9
0.9
The Global Dow
DJ Global Index
DJ Global ex U.S.
EMEA
Eurozone
Belgium
France
Germany
Israel
Italy
Netherlands
Russia
Spain
Sweden
Switzerland
U.K.
Stoxx Europe 600
Euro Stoxx
Bel-20
CAC 40
DAX
Tel Aviv
FTSE MIB
AEX
RTS Index
IBEX 35
SX All Share
Swiss Market
FTSE 100
390.22
387.41
4005.61
5331.28
12978.21
1525.77
21904.56
549.34
1183.06
10116.00
573.60
9478.92
7671.11
1.87
2.64
26.08
42.68
106.82
–6.35
59.40
4.55
28.63
36.90
3.80
97.05
23.01
Asia-Pacific
Australia
China
Hong Kong
India
Japan
Singapore
South Korea
Taiwan
S&P/ASX 200
6070.40
Shanghai Composite 3369.11
Hang Seng
30560.95
S&P BSE Sensex
33793.38
Nikkei Stock Avg
22764.94
Straits Times
3464.28
Kospi
2486.35
Weighted
10801.57
9.10
20.78
45.64
–18.88
…
33.98
6.70
90.84
–0.50
–0.04
0.48
0.69
0.66
0.81
0.83
–0.41
0.27
0.84
2.48
0.37
0.67
1.03
0.30
0.15
0.62
0.15
–0.06
Closed
0.99
0.27
0.85
0.3
0.5
0.7
0.4
0.5
1.1
0.2
0.9
2.5
0.7
0.8
1.0
–0.2
0.1
1.9
2.1
–0.8
19.1
1.8
0.8
1.5
Company
Symbol
Renren A ADR
Arrowhead Pharmaceuticals
Scana Corp
SAExploration Holdings
Hornbeck Offshore
RENN
Coherus BioSciences
FTE Networks
Adverum Biotechnologies
Mexco Energy
Insys Therapeutics
CHRS
Interlink Electronics
SemiLEDS
Krystal Biotech
UroGen Pharma
Boxlight Cl A
LINK
ARWR
SCG
SAEX
HOS
FTNW
ADVM
MXC
INSY
LEDS
KRYS
URGN
BOXL
High
52-Week
Low
% chg
Symbol
Advanced Micro Devices
Intel
General Electric
SPDR S&P 500
Finl Select Sector SPDR
AMD
Bank of America
iShares MSCI Emg Markets
Pareteum
VanEck Vectors Gold Miner
Micron Technology
BAC
INTC
GE
SPY
XLF
EEM
TEUM
GDX
MU
47.39
24.73
22.59
21.33
20.59
18.70 6.01
4.88 1.42
73.81 37.10
8.25 1.18
8.52 1.51
127.6
174.6
-35.0
-66.1
-51.8
AquaBounty Technologies
Chanticleer Holdings
Ampio Pharmaceuticals
Riot Blockchain
Innovative Ind Properties
AQB
11.40
12.70
4.30
5.04
13.38
1.85
1.95
0.65
0.72
1.85
19.37
18.14
17.81
16.67
16.05
29.59
28.08
4.35
7.18
15.02
8.05
5.90
2.40
3.13
4.10
-60.8
27.0
28.4
1.0
27.4
DPW Holdings
ChinaCache Intl Hldgs ADR
LexinFintech Holdings ADR
Technical Communications
Takung Art
DPW
6.17
4.57
10.61
44.58
5.74
0.85
0.62
1.43
5.94
0.73
16.01
15.70
15.58
15.37
14.57
10.29 4.89
10.49 1.61
11.98 8.03
46.68 13.01
9.17 5.01
-12.6
24.2
...
...
...
Sigma Labs
Taseko Mines
Smith Micro Software
Westmoreland Resource
Redfin
SGLB
Selected rates
A consumer rate against its
benchmark over the past year
30-year mortgage, Rate
Volume % chg from Latest Session
(000) 65-day avg Close % chg
149,795
113,299
80,431
70,968
56,372
197.7
304.7
3.7
0.9
-1.4
11.55 5.19
45.26 -3.39
18.15 0.95
270.47 0.63
28.07 0.54
55,414
51,278
44,677
43,963
42,472
-17.2
1.8
588.2
29.8
10.0
29.80 -0.33
48.47 0.96
2.98 11.19
23.57 -1.05
44.98 3.00
52-Week
High
Low
15.65
9.42
47.64 33.23
31.83 17.25
270.64 224.96
28.33 22.00
30.03
48.54
3.99
25.71
49.89
22.01
35.61
0.50
20.89
21.49
Benchmark
Yields
Treasury
yield
curve
andtoRates
Yield
maturity of current bills,
t
3.00
t
2.00
10-year Treasury
note yield
1.00
0.00
J FMAM J J A S ON D J
2017
3.74%
240-223-2448
Best Rate USA
Newtown Square, PA
3.75%
888-998-2451
Community Bank
Joseph, OR
3.79%
800-472-4292
Capital City Bank
Topeka, KS
3.88%
888-267-5680
10
2.25
5
1.50
One year ago
0.75
0
–5
0.00
–10
Wednesday
t
Somerset Savings Bank, SLA
3.75%
Bound Brook, NJ
732-560-1700
1
3 6
month(s)
15%
3.00
t
30-year fixed-rate
mortgage
Yen, euro vs. dollar; dollar vs.
major U.S. trading partners
3.75%
1 2 3 5 710
years
maturity
30
Euro
s
Yen
WSJ Dollar index
2017
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group
Yield/Rate (%)
Last (l)Week ago
Federal-funds rate target
1.25-1.50 1.25-1.50
Prime rate*
4.50
4.50
Libor, 3-month
1.69
1.70
Money market, annual yield
0.33
0.34
Five-year CD, annual yield
1.48
1.53
30-year mortgage, fixed†
3.96
3.91
15-year mortgage, fixed†
3.40
3.37
Jumbo mortgages, $424,100-plus† 4.33
4.35
Five-year adj mortgage (ARM)† 3.92
4.07
New-car loan, 48-month
3.30
3.24
3-yr chg
52-Week Range (%)
Low 0 2 4 6 8 High (pct pts)
0.50 l
l
3.75
l
1.01
0.26 l
1.19 l
l
3.73
l
2.99
l
4.21
l
3.20
l
2.85
1.50
4.50
1.70
0.36
1.53
4.33
3.47
4.87
4.07
3.36
1.25
1.25
1.44
-0.10
...
-0.10
0.07
-0.08
0.58
0.25
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
Corporate Borrowing Rates and Yields
Bond total return index
Close
Yield (%)
Last Week ago
52-Week
High
Low
Total Return (%)
52-wk
3-yr
1459.027
2.298
2.266
2.313
1.818
2.522 1.334
10-yr Treasury, Ryan ALM 1724.655
DJ Corporate
381.323
Aggregate, Barclays Capital 1942.090
High Yield 100, Merrill Lynch 2872.680
Fixed-Rate MBS, Barclays 1986.910
Muni Master, Merrill
522.695
2.445
3.171
2.760
5.529
2.940
2.166
2.412
3.123
2.720
5.585
2.930
2.193
2.609
3.390
2.790
5.890
3.120
2.282
2.058
2.879
2.380
4.948
2.660
1.736
2.326
5.418
3.355
6.371
2.423
4.600
808.865
5.530
5.557
5.989
5.279
8.880 6.892
Treasury, Ryan ALM
EMBI Global, J.P. Morgan
0.924
3.557
2.088
4.754
1.786
2.464
Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch
High
52-Week
Low
% chg
-2.07
-0.58
-0.47
-3.54
-4.49
-23.28
-15.59
-13.51
-12.69
-12.28
30.50 0.01
6.89 1.81
4.95 0.38
46.20 3.02
36.88 15.45
...
-24.3
211.0
456.2
70.4
3.08
1.85
15.39
8.25
2.60
-0.42
-0.25
-1.90
-0.95
-0.29
-12.00
-11.90
-10.99
-10.33
-10.03
5.95 0.40
3.16 0.72
18.29 10.15
15.40 2.25
10.50 2.15
411.8
-31.2
...
236.7
-64.4
2.11
1.93
SMSI
2.54
WMLP
2.55
RDFN
28.20
-0.23
-0.21
-0.26
-0.26
-2.87
-9.83
-9.81
-9.29
-9.25
-9.24
9.20 1.33
2.46 0.90
3.41 0.80
5.75 2.10
33.49 19.29
27.1
91.1
50.3
-54.8
...
AMPE
RIOT
IIPR
CCIH
LX
TCCO
TKAT
TGB
Ranked by change from 65-day average*
Company
Symbol
Constellation Alpha Cap
KBL Merger IV
ETFMG Alt Harvest ETF
Renren A ADR
Stellar Acquisition III
CNAC
Andina Acquisition II
MoneyGram International
PowerShs DB Prec Mtls Fd
iSh ESG 1-5Y USD Cp Bd
ClearBridge All Cap Grw
ANDA
Country/currency
KBLM
MJX
RENN
STLR
MGI
DBP
SUSB
CACG
Volume % chg from Latest Session
(000) 65-day avg Close % chg
52-Week
High
Low
1,691
1,001
5,977
10,292
198
13891
10138
4330
3178
2705
9.75
9.73
37.81
18.32
10.17
0.00
0.21
6.30
47.39
-0.29
9.90 9.55
9.80 9.65
38.38 24.53
18.70 6.01
10.28 9.99
138
8,716
615
298
233
2334
2058
1897
1632
1380
10.35
12.11
38.85
24.93
28.47
-0.19
-9.02
-0.23
0.04
1.24
10.46
17.92
40.26
25.26
28.47
US$vs,
YTDchg
Wed
in US$ per US$ (%)
9.51
11.26
35.33
24.89
24.37
Track the Markets
Compare the performance of selected global stock
indexes, bond ETFs, currencies and commodities at
WSJ.com/TrackTheMarkets
US$vs,
YTDchg
Wed
in US$ per US$ (%)
Country/currency
Americas
Europe
Argentina peso
.0542 18.4515 –0.8
Brazil real
.3089 3.2369 –2.3
Canada dollar
.7976 1.2538 –0.3
Chile peso
.001648 606.90 –1.4
Ecuador US dollar
1
1 unch
Mexico peso
.0517 19.3485 –1.6
Uruguay peso
.03472 28.8000 unch
Venezuela b. fuerte .100137 9.9864 –3.4
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
Asia-Pacific
Australian dollar
.7836 1.2762 –0.3
China yuan
.1538 6.5026 –0.01
Hong Kong dollar
.1279 7.8163 0.04
India rupee
.01576 63.440 –0.7
Indonesia rupiah .0000743 13456 –0.2
Japan yen
.008888 112.51 –0.2
Kazakhstan tenge .003002 333.16 0.1
Macau pataca
.1242 8.0492 0.04
Malaysia ringgit
.2487 4.0203 –1.0
New Zealand dollar
.7091 1.4102 0.03
Pakistan rupee
.00903 110.735 0.1
Philippines peso
.0201 49.822 –0.3
Singapore dollar
.7520 1.3297 –0.6
South Korea won .0009392 1064.69 –0.2
Sri Lanka rupee
.0065058 153.71 0.1
Taiwan dollar
.03379 29.593 –0.2
Thailand baht
.03094 32.320 –0.8
Vietnam dong
.00004404 22708 –0.01
Commodities
.04711 21.226 –0.2
.1614 6.1967 –0.1
1.2014 .8324 –0.1
.003893 256.84 –0.8
.009592 104.25 0.7
.1234 8.1055 –1.2
.2894 3.4551 –0.7
.01751 57.105 –1.0
.1223 8.1767 –0.1
1.0233 .9772 0.3
.2645 3.7812 –0.4
.0355 28.1555 0.04
1.3516 .7399 –0.02
Middle East/Africa
Bahrain dinar
Egypt pound
Israel shekel
Kuwait dinar
Oman sul rial
Qatar rial
Saudi Arabia riyal
South Africa rand
2.6519 .3771
.0565 17.7120
.2897 3.4518
3.3132 .3018
2.5974 .3850
.2748 3.639
.2666 3.7503
.0809 12.3635
TR/CC CRB Index
Crude oil, $ per barrel
Natural gas, $/MMBtu
Gold, $ per troy oz.
...
–0.3
–0.8
0.1
0.01
–0.3
...
0.02
Close Net Chg % Chg YTD%Chg
WSJ Dollar Index 85.83
0.21 0.24 –0.18
Sources: Tullett Prebon, WSJ Market Data Group
COMMODITIES
Wednesday
52-Week
Pricing trends on someClose
raw materials,
or commodities
Net chg % Chg
High
Low
DJ Commodity
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
Latest Session
Close Net chg % chg
U.S.-dollar foreign-exchange rates in late New York trading
Forex Race
notes and bonds
The Mortgage Link, Inc.
Rockville, MD
* 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.
Currencies
s
4.00%
NYSE Arca
* Common stocks priced at $5 a share or more with an average volume over 65 trading days of at least
5,000 shares =Has traded fewer than 65 days
* Volumes of 100,000 shares or more are rounded to the nearest thousand
3.91%
Bankrate.com avg†:
Nasdaq
Total volume*2,130,622,225 254,854,404
Adv. volume*1,386,985,875 176,676,285
Decl. volume* 704,676,694 77,774,770
Issues traded
3,100
1,350
Advances
1,758
1,023
Declines
1,211
305
Unchanged
131
22
New highs
246
437
New lows
25
56
Closing tick
568
67
Closing Arms†
0.74
1.30
Block trades*
8,567
1,354
6.82
3.14
3.01
24.36
32.08
BURG
Volume Movers
s
U.S. consumer rates
Symbol
5.89
0.92
8.78
0.45
0.63
CREDIT MARKETS & CURRENCIES
Consumer Rates and Returns to Investor
Company
18.32
4.64
47.65
2.56
3.69
Most Active Stocks
Company
Total volume* 806,133,862 17,686,293
Adv. volume* 487,040,967 11,358,374
Decl. volume* 300,810,353 5,928,829
Issues traded
3,061
336
Advances
1,757
190
Declines
1,211
122
Unchanged
93
24
New highs
214
7
New lows
28
1
Closing tick
663
20
Closing Arms†
0.90
0.69
Block trades*
6,959
179
Percentage Losers
Latest Session
Close Net chg % chg
Sources: SIX Financial Information; WSJ Market Data Group
WSJ
.COM
Low
-0.09 270.52 262.20
503.24
International Stock Indexes
Interest rate
NYSE NYSE Amer.
569.77
Nasdaq PHLX
Americas
Brazil
Canada
Mexico
Chile
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 5,000 shares.
Zumiez
NYSE Composite
World
Late Trading
629.45
1.73
195.35
61.63
3.008
1316.20
0.64
1.26
-0.048
2.50
0.27
% Chg
YTD
% chg
629.45
532.01
11.25
0.65
0.33 195.35
61.63
2.09
3.42
-1.57
0.19 1346.00
166.50
42.53
2.56
1163.80
1.23
15.72
-7.93
13.10
0.77
2.00
1.86
0.76
.
THE WALL STREET JOURNAL.
Thursday, January 4, 2018 | B11
COMMODITIES
WSJ.com/commodities
Futures Contracts
Contract
High hi lo
Low
Settle
243.00
248.25
March
May
960.50 s
970.00 s
955.00
963.50
959.75
968.75
4.75
5,165
4.00 348,014
Soybeans (CBT)-5,000 bu.; cents per bu.
956.25
965.75
Jan
March
435.50
448.25
618.00
625.75
149.750 s
147.125
148.825
146.150
.90
2,301
.70 184,815
March
June
33.76
33.90
.38
1,691
.35 216,815
March
18
8,756
436.00
448.25
2.50 290,393
2.00 88,295
441.00
454.00
6.25 190,154
6.00 58,791
619.75
627.00
1.75
1.50
38,445
12,954
149.375
146.825
–.150
–.050
8,936
23,408
122.950
124.375
–.400 119,103
.275 95,399
Cattle-Feeder (CME)-50,000 lbs.; cents per lb.
149.725
147.000
Jan
March
Cattle-Live (CME)-40,000 lbs.; cents per lb.
123.325
124.100
Feb
April
123.350
124.425 s
122.350
123.875
Hogs-Lean (CME)-40,000 lbs.; cents per lb.
t 70.200
71.050
.325 84,709
t 74.500
75.425
.575 69,927
Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft.
Jan
452.40
457.70
450.90
455.70
2.70
962
March
448.70
454.70 s
447.40
452.60
3.10
4,438
Milk (CME)-200,000 lbs., cents per lb.
Dec
15.40
15.44 s t
15.39
15.44
.02
3,726
Jan'18
14.00
14.11
13.95
14.01
–.01
3,546
Cocoa (ICE-US)-10 metric tons; $ per ton.
1,942
1,943
1,888
1,907
–29 144,503
March
May
1,938
1,941
1,890
1,908
–27 52,972
Coffee (ICE-US)-37,500 lbs.; cents per lb.
130.00
131.35 s
126.20
128.60 –1.60 122,459
March
May
132.20
133.50 s
128.45
130.95 –1.45 46,368
Sugar-World (ICE-US)-112,000 lbs.; cents per lb.
15.35
15.37 s
15.18
15.31
–.02 378,476
March
May
15.20
15.24 s
15.06
15.21
.02 158,463
Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb.
March
26.99
27.05 s t
26.99
26.95
–.10
3,525
May
26.92
26.96
t
26.86
26.87
–.42
2,168
Cotton (ICE-US)-50,000 lbs.; cents per lb.
77.51
78.29
77.37
78.11
.61 173,730
March
May
77.82
78.50
77.61
78.26
.49 54,935
Orange Juice (ICE-US)-15,000 lbs.; cents per lb.
138.60
138.60 s
138.60
139.50
3.80
350
Jan
March
137.00
140.85 s
136.35
139.35
2.80
7,920
71.100
75.075
Feb
April
339,055
280,876
158,118
129,236
88,178
50,742
2.00
.75
442.00 s
454.75 s
623.25 s
630.50 s
618.00
629.25
March
May
139,251
77,842
244.50
249.00
432.00
444.50
Wheat (MPLS)-5,000 bu.; cents per bu.
158,507
90,814
242.00
248.25
435.50
449.00
March
May
471,247
384,164
166,659
125,718
252,494
257,005
245.25 s
250.50 s
437.00 s
449.25 s
314.40
318.60
1141.00 –12.50
1164.50 –13.00
Wheat (KC)-5,000 bu.; cents per bu.
204
151,182
–.25 825,820
–.25 243,528
435.25
447.25
March
May
379
78,451
353.00
369.50
1153.50 s t 1150.00
1177.00
t 1161.50
1153.50
1173.00
71.200
75.525
4,777
1,672
Interest Rate Futures
March
June
Wednesday
0.9806
1.0313
6.880
6.620
6.880
48.380
5.880
5.470
5.820
6.510
59.850
12.100
151-220 152-130
150-160 151-060
151-170
150-160
152-100
151-080
18.0 759,743
18.0
25
Wednesday
Gold, per troy oz
1319.89
1418.88
1314.90
1459.53
*1312.80
*1312.05
1370.20
1383.38
1383.38
1596.51
1294.41
1383.38
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.
17.1900
20.6280
17.1850
21.4810
£12.6300
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA spot price
17.1250
12806
(U.S.$ equivalent)
Coins,wholesale $1,000 face-a
Other metals
LBMA Platinum Price PM
*936.0
Platinum,Engelhard industrial
954.0
Platinum,Engelhard fabricated
1054.0
Palladium,Engelhard industrial
1091.0
Palladium,Engelhard fabricated
1191.0
Aluminum, LME, $ per metric ton
*2256.0
Copper,Comex spot
3.2370
Iron Ore, 62% Fe CFR China-s
75.2
Shredded Scrap, US Midwest-s,w
307
Steel, HRC USA, FOB Midwest Mill-s
654
Fibers and Textiles
Metals
March
0.6225
0.7736
*89.35
67.000
n.a.
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
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, 5% Broken White, Thailand-l,w
Rice, Long Grain Milled, No. 2 AR-u,w
Sorghum,(Milo) No.2 Gulf-u
4.85
115
3.2750
98.8
479.8
228
94
228
2.7700
385.00
25.00
8.0900
Wednesday
SoybeanMeal,Cent IL,rail,ton48%-u
Soybeans,No.1 yllw IL-bp,u
Wheat,Spring14%-pro Mnpls-u
Wheat,No.2 soft red,St.Louis-bp,u
Wheat - Hard - KC (USDA) $ per bu-u
Wheat,No.1soft white,Portld,OR-u
314.10
9.2800
n.a.
4.4200
4.2400
5.2800
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
190.24
178.92
0.8980
2.2200
140.00
150.75
67.00
2112
1.2927
1.4839
1.3250
15.50
0.57
64.80
1.1070
0.8380
n.a.
n.a.
Fats and Oils
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
33.4400
0.2300
0.3400
0.3248
0.2700
n.a.
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;
L=livericeindex.com; M=midday; 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 1/2
Source: WSJ Market Data Group
Jan
Feb
Exchange-Traded Portfolios | WSJ.com/ETFresearch
Largest 100 exchange-traded funds, latest session
ETF
AlerianMLPETF
CnsmrDiscSelSector
CnsStapleSelSector
EnSelectSectorSPDR
FinSelSectorSPDR
GuggS&P500EW
HealthCareSelSect
IndSelSectorSPDR
iShIntermCredBd
iSh1-3YCreditBond
iShCoreMSCIEAFE
iShCoreMSCIEmgMk
iShCoreMSCITotInt
iShCoreS&P500
iShCoreS&P MC
iShCoreS&P SC
iShS&PTotlUSStkMkt
iShCoreUSAggBd
iShSelectDividend
iShEdgeMSCIMinEAFE
iShEdgeMSCIMinUSA
iShGoldTr
iShiBoxx$InvGrCpBd
iShiBoxx$HYCpBd
iShJPMUSDEmgBd
iShMBSETF
iShMSCI ACWI
iShMSCIBrazil
iShMSCI EAFE
iShMSCI EAFE SC
iShMSCIEmgMarkets
iShMSCIEurozone
iShMSCIJapan
iShNasdaqBiotech
iShNatlMuniBd
iShRussell1000Gwth
iShRussell1000
iShRussell1000Val
iShRussell2000Gwth
iShRussell2000
iShRussell2000Val
iShRussell3000
iShRussellMid-Cap
iShRussellMCValue
iShS&PMC400Growth
iShS&P500Growth
AMLP
XLY
XLP
XLE
XLF
RSP
XLV
XLI
CIU
CSJ
IEFA
IEMG
IXUS
IVV
IJH
IJR
ITOT
AGG
DVY
EFAV
USMV
IAU
LQD
HYG
EMB
MBB
ACWI
EWZ
EFA
SCZ
EEM
EZU
EWJ
IBB
MUB
IWF
IWB
IWD
IWO
IWM
IWN
IWV
IWR
IWS
IJK
IVW
11.33
100.65
56.52
74.55
28.07
102.30
84.41
76.53
109.10
104.49
67.01
58.51
64.21
272.42
191.92
77.32
61.92
109.18
98.81
73.51
52.87
12.64
120.97
87.76
116.35
106.56
73.14
42.19
71.17
65.41
48.47
43.83
61.12
110.88
110.72
137.13
150.60
125.38
189.13
154.06
126.69
160.21
210.64
89.86
218.86
155.46
2.44
0.46
–0.04
1.50
0.54
0.51
0.96
0.54
0.05
0.02
0.67
0.88
0.66
0.58
0.18
–0.09
0.55
0.01
0.13
0.29
0.21
–0.24
0.18
0.48
–0.04
0.04
0.51
1.22
0.48
0.74
0.96
0.53
1.38
1.41
0.12
0.85
0.60
0.38
0.32
0.10
–0.11
0.53
0.50
0.23
0.34
0.85
5.0
2.0
–0.7
3.2
0.6
1.3
2.1
1.1
–0.1
–0.0
1.4
2.8
1.8
1.3
1.1
0.7
1.3
–0.1
0.3
0.7
0.2
1.0
–0.5
0.6
0.2
–0.0
1.5
4.3
1.2
1.4
2.9
1.0
2.0
3.8
–0.0
1.8
1.3
0.8
1.3
1.0
0.7
1.3
1.2
0.8
1.4
1.8
Closing Chg YTD
Symbol Price (%) (%)
ETF
Closing Chg YTD
Symbol Price (%) (%)
iShS&P500Value
iShUSPfdStk
iShShortTreasuryBd
iShTIPSBondETF
iSh1-3YTreasuryBd
iSh7-10YTreasuryBd
iSh20+YTreasuryBd
iShRussellMCGrowth
PIMCOEnhShMaturity
PwrShQQQ 1
PwrShS&P500LoVol
PwrShSrLoanPtf
SPDR BlmBarcHYBd
SPDR Gold
SchwabIntEquity
SchwabUS BrdMkt
SchwabUS Div
SchwabUS LC
SPDR DJIA Tr
SPDR S&PMdCpTr
SPDR S&P 500
SPDR S&P Div
TechSelectSector
UtilitiesSelSector
VanEckGoldMiner
VangdInfoTech
IVE
PFF
SHV
TIP
SHY
IEF
TLT
IWP
MINT
QQQ
SPLV
BKLN
JNK
GLD
SCHF
SCHB
SCHD
SCHX
DIA
MDY
SPY
SDY
XLK
XLU
GDX
VGT
115.30
37.93
110.23
113.91
83.82
105.33
126.09
122.68
101.57
160.03
47.55
23.07
36.94
124.82
34.55
65.35
51.48
64.64
248.95
349.27
270.47
94.60
65.28
51.78
23.57
168.72
0.41
0.18
...
0.10
...
0.10
0.48
0.83
0.01
0.97
0.32
–0.09
0.49
–0.26
0.70
0.55
0.29
0.64
0.37
0.16
0.63
0.04
0.83
–0.79
–1.05
1.04
0.9
–0.4
–0.0
–0.1
–0.0
–0.2
–0.6
1.7
0.0
2.7
–0.4
0.1
0.6
0.9
1.4
1.3
0.6
1.3
0.6
1.1
1.4
0.1
2.1
–1.7
1.4
2.4
VangdSC Val
VangdDivApp
VangdFTSEDevMk
VangdFTSE EM
VangdFTSE Europe
VangdFinls
VangdFTSEAWxUS
VangdGrowth
VangdHlthCr
VangdHiDiv
VangdIntermBd
VangdIntrCorpBd
VangdLC
VangdMC
VangdMC Val
VangdREIT
VangdS&P500
VangdST Bond
VangdSTCpBd
VangdSC
VangdTotalBd
VangdTotIntlBd
VangdTotIntlStk
VangdTotalStk
VangdTotlWrld
VangdValue
WisdTrEuropeHdg
WisdTrJapanHdg
VBR
VIG
VEA
VWO
VGK
VFH
VEU
VUG
VHT
VYM
BIV
VCIT
VV
VO
VOE
VNQ
VOO
BSV
VCSH
VB
BND
BNDX
VXUS
VTI
VT
VTV
HEDJ
DXJ
133.82
102.86
45.53
47.15
59.75
70.21
55.66
143.58
157.61
86.20
83.65
87.24
124.28
156.66
112.57
82.43
248.56
79.06
79.28
149.26
81.41
54.29
57.78
139.02
75.42
107.06
64.18
60.42
–0.01
0.46
0.62
0.96
0.35
0.31
0.63
0.93
0.99
0.33
0.11
0.08
0.64
0.54
0.40
–0.29
0.59
0.01
0.01
0.19
0.09
0.07
0.70
0.58
0.68
0.38
0.83
1.61
0.8
0.8
1.5
2.7
1.0
0.2
1.7
2.1
2.3
0.7
–0.2
–0.2
1.4
1.2
0.9
–0.7
1.3
–0.1
–0.0
1.0
–0.2
–0.1
1.7
1.3
1.6
0.7
0.7
1.8
IPO Scorecard
Company SYMBOL
IPO date/Offer price
% Chg From
Wed3s Offer 1st-day
close ($) price close
Company SYMBOL
IPO date/Offer price
% Chg From
Wed3s Offer 1st-day
close ($) price close
12.75
70.0
9.6
Newmark Grp
NMRK Dec. 15/$14.00
15.75
12.5
iClick Interactive Asia Grp 9.87
ICLK Dec. 22/$8.00
LexinFintech Hldgs
15.39
LX Dec. 21/$9.00
Dogness
5.71
DOGZ Dec. 20/$5.00
23.4
9.7
16.65
–7.5 –22.4
71.0
43.8
Denali Thera
DNLI Dec. 8/$18.00
GigCapital
GIG.U Dec. 8/$10.00
Luther Burbank
LBC Dec. 8/$10.75
Cue Biopharma
CUE Jan. 2/$7.50
Casa Sys
CASA Dec. 15/$13.00
18.20
14.2
–4.8
40.0
26.4
CURO Grp Hldgs
CURO Dec. 7/$14.00
10.05
0.5
12.9
0.5
12.16
13.1
3.5
14.02
0.1
–1.3
Sources: WSJ Market Data Group; FactSet Research Systems
Dividend announcements from January 3.
Symbol
Amount
Yld % New/Old Frq
Payable /
Record
Increased
Alamo Group
Bank of The Ozarks
OZRK
0.4
1.6
.11 /.10
.19 /.185
Q
Q
Jan29 /Jan16
Jan26 /Jan19
CMRE
6.6
.10
Q
Feb06 /Jan23
ALG
Foreign
Costamare
115-317 116-027
115-300
106-315 107-002
106-305
98.590
98.590
98.590
t
98.590 s t
97.906
98.016
3.0 3,250,538
3.0
4,892
115-315
.2 3,085,886
106-310
–.5 1,797,752
98.590
98.590
97.797
… 264,290
… 200,920
97.922
.125
98.4650
98.4675
98.4650 s t 98.4625
98.4725 s
98.4675
98.4650
98.4700
.0025
.0025
7,681
4,684
Eurodollar (CME)-$1,000,000; pts of 100%
Jan
March
June
Dec
98.3200
98.2100
98.0400
97.8250
98.3275
98.2250
98.0550
97.8450
98.3200
t 98.2050
t 98.0250
t 97.8050
98.3200
… 256,859
98.2100
… 1,403,230
98.0350 –.0100 1,327,173
97.8150 –.0100 1,447,571
.8917
.8948
.8894
.8913
.7990
.8000
.7994
.8010 s
.7972
.7974
.8892 –.0021
2,311
.8919 –.0021 226,582
.7977 –.0020
1,129
.7984 –.0020 121,651
British Pound (CME)-£62,500; $ per £
Jan
March
1.3596
1.3624
1.3609 s t
1.3646 s t
1.3504
1.3525
1.3520 –.0081
2,958
1.3547 –.0081 206,324
Swiss Franc (CME)-CHF 125,000; $ per CHF
March
1.0346
t
1.0350
1.0258
.7843
.7842
.7844 s
.7840 s t
.7805
.7805
.7804
.7805
March
June
.05105 s
.05023
.05048
.05002
.7840
.7839
.7839
.7839
.0009
1,260
.0009
590
.0009 120,895
.0010
331
Euro (CME)-€125,000; $ per €
Jan
March
1.2064
1.2109
1.2070
1.2119
t
t
.05048
.04972
.05097 .00028 193,620
.05017 .00029
145
1.2010
1.2054
1.2024 –.0038
7,868
1.2069 –.0037 510,820
Index Futures
Mini DJ Industrial Average (CBT)-$5 x index
March
June
24908 s
24921 s
24768
24810
2713.70 s
2715.90 s
2692.70
...
2714.25 s
2716.00 s
2692.25
2694.75
1928.70 s
1917.30
6591.3 s
6609.5 s
6511.3
6531.5
1557.70 s
1547.90
1504.70 s
1496.10
91.99 s
91.62 s
91.54
91.27
24796
24810
24878
24893
S&P 500 Index (CME)-$250 x index
March
June
2693.00
...
Mini S&P 500 (CME)-$50 x index
March
June
2693.75
2696.00
1917.70
Mini Nasdaq 100 (CME)-$20 x index
Canadian Dollar (CME)-CAD 100,000; $ per CAD
Jan
March
Open
interest
Mexican Peso (CME)-MXN 500,000; $ per MXN
March
Japanese Yen (CME)-¥12,500,000; $ per 100¥
.8917
.8943
Chg
110 148,530
108
185
2710.90
2713.00
18.00
18.10
51,613
122
2711.00
2713.00
18.00 3,017,744
18.00 30,007
Mini S&P Midcap 400 (CME)-$100 x index
Currency Futures
Jan
March
.7820
.7805
.7826
.7805
Jan
Feb
March
June
25,514
1 Month Libor (CME)-$3,000,000; pts of 100%
Jan
Feb
Settle
Australian Dollar (CME)-AUD 100,000; $ per AUD
123-250
123-150
98.588
98.585
Contract
High hilo
Low
Open
1.0288 –.0055
March
June
6513.3
6532.5
Mini Russell 2000 (ICE-US)-$100 x index
March
1550.20
Mini Russell 1000 (ICE-US)-$100 x index
March
1496.90
U.S. Dollar Index (ICE-US)-$1,000 x index
91.56
91.31
March
June
75,558
1924.40
3.00
6584.5
6603.3
92,473
69.8 276,028
69.5
898
1555.70
7.00
23,178
1502.60
12.40
184
91.90
91.57
.32
.31
51,150
1,089
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
-0.2
2618.18
2.760 2.380 2.790
U.S. Aggregate
-0.3
-0.1
3916.96 -0.6
YTD total
return (%)
Yield (%)
Latest Low High
Index
Mortgage-Backed Bloomberg Barclays
Broad Market Bloomberg Barclays
1942.09
Total
return
close
1986.91
-0.1
Mortgage-Backed
1953.59
-0.1
Ginnie Mae (GNMA) 2.900 2.630 3.090
Fannie mae (FNMA) 2.950 2.670 3.120
2.940 2.660 3.120
U.S. Corporate
3.290 3.030 3.500
1165.43
-0.2
Intermediate
2.930 2.530 2.990
1794.56
-0.2
Long term
4.060 3.990 4.680
522.70
0.1
Muni Master
2.166 1.736 2.282
Freddie Mac (FHLMC) 2.970 2.680 3.130
568.57
-0.3
Double-A-rated
2.760 2.470 2.870
365.66
0.04
7-12 year
2.182 1.744 2.394
722.17
-0.3
Triple-B-rated
3.580 3.340 3.830
412.56
0.1
12-22 year
2.458 2.213 2.872
400.58
0.1
22-plus year
2.823 2.716 3.449
High Yield Bonds Merrill Lynch
0.4
419.40
High Yield Constrained 5.722 5.373 6.189
Global Government J.P. Morgan†
10.316 9.584 11.091
543.21
-0.2
Global Government 1.480 1.300 1.560
5.529 4.948 5.890
754.04
-0.1
Canada
2.100 1.570 2.190
0.4
Global High Yield Constrained 5.114 4.934 5.738
369.98
-0.1
EMU§
1.159 0.956 1.363
0.3
Europe High Yield Constrained 2.393 1.897 3.196
710.04
-0.1
France
0.870 0.690 1.210
506.99
-0.1
Germany
0.530 0.210 0.620
Japan
0.400 0.340 0.460
0.7 Triple-C-rated
423.33
2872.68
0.4
High Yield 100
380.45
307.40
U.S Agency Bloomberg Barclays
1636.41
-0.1
U.S Agency
2.240 1.690 2.250
288.70
1461.51
-0.1
10-20 years
2.110 1.490 2.110
560.12
-0.1
Netherlands
0.640 0.390 0.760
20-plus years
2.960 2.730 3.410
928.65
-0.2
U.K.
1.530 1.340 1.790
Yankee
3.010 2.610 3.050
808.87
3377.48 -0.4
2461.15
-0.2
unch.
0.1
Emerging Markets ** 5.530 5.279 5.989
*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
Global Government Bonds: Mapping Yields
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
1.875
2.250
l
1.927
2.463
1.774
2.363
1.218
2.448
1.982 t
2.694 s
l
1.987
1.773
1.831
l
2.666
2.544
2.759
France 2 -0.465 t
10 0.801 t
l
-0.448
-0.591
l
0.823
0.604
Germany 2 -0.616 t
10 0.442 t
l
-0.614
-0.701
l
0.468
Italy 2 -0.148 t
10 2.071 t
l
Australia 2
10
0.750
0.500
0.050
0.100
Spread Under/Over U.S. Treasurys, in basis points
Latest
Prev
Year ago
6.0
4.2
24.8
-0.693 -240.5
0.781
-164.5
61.3
20.4
31.1
-237.5
-191.2
-164.0
-166.7
-254.2
-199.8
0.309
-0.780 -255.5
0.266
-200.4
-199.5
-218.2
-0.104
-0.289
-0.177
-203.1
-139.5
l
2.101
1.702
1.882
l
-0.138
-0.153
l
0.050
0.034
Spain 2 -0.368 t
10 1.582 t
l
-0.333
-0.372
l
1.619
1.422
0.471 t
1.217 t
l
0.509
0.473
0.128
l
1.288
1.235
1.184
Japan 2 -0.138
10
0.100
2.750
Year ago
l
2.750
0.000
Month ago
U.S. 2 1.940 s
10 2.446 t
2.750
1.000
Yield (%)
Latest(l) 0 20 40 60 80 100 120 Previous
1.750
U.K. 2
4.250
10
0.050
-208.7
-36.1
-56.7
-0.178
-206.5
-139.6
-241.3
-240.7
-0.326 -230.8
1.426 -86.5
-226.0
-154.4
-37.6
-207.7
0.041 -239.7
-146.9
-122.9
-84.3
-102.2
-141.9
-109.0
-117.5
-126.4
Source: Tullett Prebon
Corporate Debt
in that same company’s share price.
Investment-grade spreads that tightened the most…
Issuer
Symbol Coupon (%)
Teva Pharma III
Microsoft
Glencore Funding
Viacom
TEVA
Dell International
Royal Bank of Scotland
DELL
MSFT
GLENLN
VIA
RBS
Maturity
Current
Spread*, in basis points
One-day change
Last week
Stock Performance
Close ($)
% chg
2.200
1.850
4.625
6.875
July 21, ’21
Feb. 6, ’20
April 29, ’24
April 30, ’36
n.a.
17
122
276
–25
–14
–11
–10
n.a.
n.a.
n.a.
n.a.
…
86.35
...
34.05
…
0.47
...
–2.01
8.350
6.125
July 15, ’46
Dec. 15, ’22
338
173
–8
–8
345
175
...
7.59
...
–1.04
24
19
18
18
45
36
25
n.a.
...
158.49
...
108.06
...
2.75
...
0.10
6
6
5
5
113
62
85
n.a.
40.41
18.06
172.23
35.45
–1.61
1.01
–0.02
0.20
…And spreads that widened the most
Westpac Banking
International Business Machines
Anheuser–Busch Inbev Finance
JPMorgan Chase
WSTP
Comcast
Credit Suisse AG
Apple
AstraZeneca
CMCSA
IBM
ABIBB
JPM
CS
AAPL
AZN
2.600
3.625
2.650
2.400
Nov. 23, ’20
Feb. 12, ’24
Feb. 1, ’21
June 7, ’21
52
58
47
50
3.999
Nov. 1, ’49
3.625 Sept. 9, ’24
3.850
Aug. 4, ’46
6.450 Sept. 15, ’37
119
87
92
117
High-yield issues with the biggest price increases…
Performance of IPOs, most-recent listed first
Dividend Changes
Company
123-205
123-110
10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100%
March
1.450
ETF
123-220 123-285
123-130 123-185
30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg.
2.050
Wednesday, January 3, 2018
Closing Chg YTD
Symbol Price (%) (%)
Open
interest
Chg
2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100%
2793.38
Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
Wednesday, January 03, 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.
Propane,tet,Mont Belvieu-g
Butane,normal,Mont Belvieu-g
NaturalGas,HenryHub-i
Correcting previous
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
Settle
U.S. Corporate Indexes Bloomberg Barclays
Cash Prices
Energy
Contract
High hilo
Low
Open
5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100%
33.38
33.52
Wheat (CBT)-5,000 bu.; cents per bu.
1
36,344
1,491
352.25
368.50
33.75 s
33.91 s
33.38
33.54
Jan
March
Corn (CBT)-5,000 bu.; cents per bu.
Oats (CBT)-5,000 bu.; cents per bu.
Open
interest
Chg
Treasury Notes (CBT)-$100,000; pts 32nds of 100%
313.00
317.00
Rough Rice (CBT)-2,000 cwt.; $ per cwt.
243
361,017
48,756
41,062
13,089
25,831
354.75 s
371.00 s
314.80
319.10
Soybean Oil (CBT)-60,000 lbs.; cents per lb.
Jan
March
1,487
175,744
Agriculture Futures
353.00
369.50
314.20
318.40
Jan
March
Open
Chg interest
Copper-High (CMX)-25,000 lbs.; $ per lb.
3.2390
3.2435
t 3.2220
3.2370 –0.0190
Jan
March
3.2775
3.2800
t 3.2365
3.2575 –0.0205
Gold (CMX)-100 troy oz.; $ per troy oz.
1320.00 1320.10 s
1312.10 1316.20
2.50
Jan
Feb
1319.00 1323.00 s
1308.90 1318.50
2.40
April
1323.70 1327.40 s
1313.90 1323.40
2.50
June
1329.00 1332.30 s
1319.00 1328.20
2.50
Aug
1334.00 1334.00
1324.70 1333.10
2.60
Dec
1345.70 1345.70 s
1334.50 1342.80
2.70
Palladium (NYM) - 50 troy oz.; $ per troy oz.
Jan
...
... s
... 1086.00 –4.00
March
1087.20 1089.30
1075.65 1083.35 –4.00
June
1077.05 1079.10
1067.30 1074.35 –3.75
Platinum (NYM)-50 troy oz.; $ per troy oz.
941.50
959.90 s
941.50
957.80 14.00
Jan
April
949.00
965.90 s
943.50
962.30 14.50
Silver (CMX)-5,000 troy oz.; $ per troy oz.
17.080
17.160 s t 17.080
17.185 0.064
Jan
March
17.225
17.285 s
17.065
17.267 0.061
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl.
60.39
61.97 s
60.28
61.63
1.26
Feb
March
60.37
61.83 s
60.28
61.55
1.17
April
60.32
61.65 s
60.23
61.41
1.08
May
60.24
61.40 s
60.12
61.21
1.01
June
59.95
61.12 s
59.88
60.94
0.95
Dec
58.06
58.88 s
57.98
58.77
0.65
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal.
2.0598
2.0897
t 2.0538
2.0880 .0296
Feb
March
2.0343
2.0680 s t 2.0285
2.0664 .0333
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal.
1.7601
1.8085 s t 1.7588
1.7974 .0343
Feb
March
1.7818
1.8285 s t 1.7809
1.8185 .0337
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu.
3.040
3.056
2.959
3.008 –.048
Feb
March
2.960
2.974
2.885
2.931 –.042
April
2.794
2.800
t
2.733
2.777 –.016
May
2.780
2.784
t
2.722
2.764 –.013
Oct
2.847
2.847
t
2.791
2.832 –.012
Jan'19
3.086
3.103
t
3.062
3.094 –.012
March
July
Settle
Soybean Meal (CBT)-100 tons; $ per ton.
Metal & Petroleum Futures
Open
Contract
High hilo
Low
Open
Company
Symbol
Amount
Yld % New/Old Frq
Costamare Pfd. B
Costamare Pfd. C
Costamare Pfd. D
CMREpB
CMREpC
CMREpD
7.5
8.3
8.4
.47656
.53125
.54688
Q
Q
Q
Payable /
Record
Jan16 /Jan12
Jan16 /Jan12
Jan16 /Jan12
KEY: A: annual; M: monthly; Q: quarterly; r: revised; SA: semiannual;
S2:1: stock split and ratio; SO: spin-off.
Issuer
Symbol
EP Energy
Denbury Resources
PetSmart
MEG Energy
EPENEG
Ensco
Noble Holding International
Ferrellgas
Mattel
ESV
Coupon (%)
Maturity
Bond Price as % of face value
Current
One-day change
6.375 June 15, ’23
5.500
May 1, ’22
7.125 March 15, ’23
6.375 Jan. 30, ’23
59.000
72.969
64.125
89.750
5.200 March 15, ’25
7.750 Jan. 15, ’24
6.750 June 15, ’23
5.450
Nov. 1, ’41
89.031
89.250
95.250
85.875
10.000 July 15, ’22
7.625 Sept. 24, ’21
UNIT
7.125 Dec. 15, ’24
ALTHBD 6.250
Feb. 1, ’25
110.250
96.970
91.000
103.000
8.625
8.250
HEES
5.625
MOHEGN 7.875
85.000
106.250
105.000
103.250
DNR
PETM
MEGCN
NE
FGP
MAT
Last week
Stock Performance
Close ($)
% chg
n.a.
n.a.
58.500
85.500
...
2.32
...
...
...
1.31
...
...
3.16
3.00
2.75
2.38
84.750
86.375
n.a.
82.875
6.61
…
4.61
16.14
7.13
…
0.22
0.75
–1.00
–0.78
–0.78
–0.75
109.500
n.a.
90.750
n.a.
3.29
3.05
17.05
...
–0.90
–5.57
–0.93
...
85.500
n.a.
n.a.
103.500
4.61
14.68
38.20
...
0.22
–0.27
–2.25
...
4.75
4.59
3.88
3.78
…And with the biggest price decreases
K. Hovnanian Enterprises
Genworth Financial
Uniti
Alpha 3
HOV
Ferrellgas Partners
Laureate Education
H&E Equipment Services
Mohegan Gaming & Entertainment*
FGP
GNW
LAUR
June 15, ’20
May 1, ’25
Sept. 1, ’25
Oct. 15, ’24
–0.75
–0.75
–0.53
–0.50
*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
.
B12 | Thursday, January 4, 2018
* *
THE WALL STREET JOURNAL.
FINANCE & MARKETS
Late
Alibaba’s Ma Takes Strike 3 in U.S. HNA
To Repay
Entrepreneur’s
Ant Financial hoped to
build payments titan
out of MoneyGram
Employees’
Loans to It
Departure
Bond-trading volumes in Europe
on Wednesday morning deviated
sharply from the norm.
Early Wednesday* volumes,
change from the 30-day average
for the same part of the day
GOVERNMENT BONDS
Eurodenominated
–25%
U.K.
–11%
CORPORATE BONDS
Euro
3%
Sterling –46%
*As of 10 a.m. GMT
Source: Trax, MarketAxess
THE WALL STREET JOURNAL.
Europe Bond
Volumes Fall
As New Bank
Rules Begin
BY CHRISTOPHER WHITTALL
Trading in some bonds fell
sharply in Europe on Wednesday as banks implemented
the massive set of new finance
regulations known as Mifid II.
The drop-off was largely expected, given the volume of
trading data that now needs to
be recorded makes Mifid II a
huge technology challenge for
banks. The Markets in Financial Instruments Directive II
came into force Wednesday and involves the largest
overhaul of European financial
markets in years.
The new regulation touches
virtually every aspect of how
securities are traded across
the Continent, in a longplanned bid to halt future financial crashes and stop finance
companies
from
gouging investors.
Some of the most significant changes demand that
most trades be reported to
regulators almost immediately.
The rules also introduce
greater transparency around
bond trading, forcing brokers
to publish prices for the most
actively traded securities before trades are completed.
It is in government bonds—
many of which are subject to
those pretrade rules—where
volumes fell particularly
sharply on Wednesday. Trading volumes in euro-denominated government bonds were
down around 25% compared
with their 30-day average as
of 10 a.m. GMT, according to
estimates from Trax, a subsidiary of trading platform MarketAxess. U.K. government
bond volumes were down
around 11%.
A billboard in Vietnam features a portrait of Jack Ma. His Ant Financial was carved out of Alibaba.
countries. The two companies
scrapped the deal Tuesday,
giving up a yearlong campaign
to persuade the Committee on
Foreign Investment in the U.S.
to approve the transaction.
The U.S. has long been an
elusive market for Mr. Ma despite his global ambitions, said
Shaun Rein, managing director
of China Market Research
Group. Despite its immense
success in China, Alibaba has
found little demand for its ecommerce services in the U.S.,
compared with established
players such as Amazon.com
Inc. and eBay Inc., while high
credit-card penetration in the
U.S. has limited the expansion
possibilities for Alipay.
With U.S.-China trade tensions running high, Mr. Ma
and other high-profile Chinese
companies may find it even
harder to acquire businesses
in the U.S., Mr. Rein said.
On Wednesday, China’s Foreign Ministry spokesman,
Geng Shuang, said Beijing encourages Chinese companies
to invest overseas in a way
that is in keeping with market
principles and foreign laws
and regulations. “At the same
time, we hope the U.S. can
provide a fair and predictable
environment” for Chinese
companies, Mr. Geng said.
Alibaba, whose chairman is
Mr. Ma, has faced other setbacks even after its successful
New York Stock Exchange listing in 2014. Although the ecommerce giant dwarfs its U.S.
counterparts in terms of the
value of transactions it handles, like Ant, it has launched
many global initiatives but remains a minor-league player in
the world’s biggest economy.
In June 2014, Alibaba tried
to break into America’s online
retail sector by launching 11
Main, a U.S. shopping website
selling clothing, accessories
and arts and crafts. The effort
didn’t gain traction, and Alibaba sold the online marketplace a year later to a New
York-based e-commerce site
called OpenSky.
Ant Financial still wants to
build a competitive international network, but those efforts are likely to move more
slowly without the MoneyGram acquisition. The company said a year ago it wants
to have two billion customers
by 2025. Its users now number
around 500 million.
Yuan Fix at Strongest Since May 2016
BY SAUMYA VAISHAMPAYAN
broad selloff overnight.
The WSJ Dollar Index,
which measures the dollar
against a 16-currency basket,
was down for seven straight
trading days through Tuesday—its longest losing streak
since February 2014. But it
rose slightly during Asian
trading hours early Wednesday and later ended in New
York at 85.83, 0.2% higher on
the day.
Analysts said there could be
another factor behind the
yuan’s strength: Beijing’s desire to quash fears of a yuan
depreciation that could spur
capital outflows.
Such considerations have
led to a bias for a stronger
yuan in the daily fix in recent
weeks, said Eddie Cheung, a
foreign-exchange strategist at
Standard Chartered in Hong
Kong.
A stronger yuan is “good
for the story [the Chinese] are
telling the world: that every-
China’s central bank guided
the yuan to its highest level
against the U.S. dollar in more
than a year and a half on
Wednesday, following the dollar’s overnight slide against
global currencies.
The People’s Bank of China
set the dollar’s daily reference
rate at 6.4920 yuan, putting
the Chinese currency at its
strongest since May 2016. In
late New York trading
Wednesday, the yuan was at
6.5026 per dollar, up 0.17%
from late Tuesday.
The yuan doesn’t float
freely; instead, the central
bank each day fixes a midpoint
for the dollar-yuan pair and allows trading within 2% above
and below that. The yuan
trades more freely offshore.
The PBOC considers the
previous day’s exchange rate
when it calculates the fix, and
the dollar had suffered a
thing is stable,” Mr. Cheung
said. “It just shows they’re
still in control.”
The yuan strengthened 6.7%
against the U.S. currency in
2017, its biggest annual percentage gain since 2008. Still,
currencies of some of China’s
regional exporting rivals such
as Taiwan and Korea gained
6.4920
Beijing set the dollar’s reference
rate in yuan here on Wednesday.
more, suggesting China maintained some of its competitive
advantage in global trade.
Currency analysts are divided on the likely path of the
yuan this year, though few expect a move the size of last
year’s.
Among yuan bulls, Standard
Chartered foresees one dollar
weakening to buy 6.45 yuan by
year-end. Commonwealth Bank
of Australia expects it to end
at 6.35 yuan.
Andy Ji, Asian currency and
rates strategist at Commonwealth Bank of Australia in
Singapore, said his bank’s outlook for the yuan is mostly
about the U.S. dollar. “People
wouldn’t hesitate to sell” the
dollar against the yuan in the
current soft-dollar environment, he said.
Still, any sign of softness in
China’s economy—as Beijing
continues trying to reduce the
country’s high levels of borrowing—could encourage officials to goose exports by letting the yuan weaken against
the dollar.
In the bearish yuan camp,
both Société Générale and
Morgan Stanley expect one
dollar to buy 6.70 yuan by the
end of 2018.
Crude-Oil Prices Climb to 3-Year High
BY STEPHANIE YANG
AND CHRISTOPHER ALESSI
Oil prices rose to a threeyear high as antigovernment
protests in Iran and a blast of
cold weather raised concerns
about potential supply disruptions.
Light, sweet crude for February delivery gained $1.26, or
2.1%, to $61.63 a barrel on the
New York Mercantile Exchange
on Wednesday, the highest
settlement value since December 2014. Brent, the global
benchmark, advanced $1.27, or
1.9%, to $67.84 a barrel.
Antigovernment demonstrators have taken to the
streets in cities across Iran
over the past week to voice
anger over the country’s economic woes. The protests,
which have left more than 20
people dead, have reignited a
geopolitical risk premium in
global oil markets amid concerns the civil unrest could result in crude supply disruptions out of the Islamic
Republic.
While the protests haven’t
affected oil production, analysts cautioned the situation
could change if the U.S. were
to impose fresh sanctions on
the Iranian regime or dismantle the 2015 international
agreement to curb Tehran’s
nuclear program.
“This justifies a certain
risk premium on the oil price,
though this should already be
more than sufficiently reflected in the current price
level,” Commerzbank AG analysts wrote in a note
ABEDIN TAHERKENAREH/EPA/SHUTTERSTOCK
The third time wasn’t a
charm for Jack Ma.
Ant Financial Services
Group’s failed bid to acquire
Dallas-based MoneyGram International Inc., which followed three rounds of reviews
by a U.S. national security
panel, was the latest in several
setbacks for the Chinese billionaire, whose companies have
long sought to establish American beachheads.
Mr. Ma, 53 years old, created Ant Financial after carving out a payments business
from his e-commerce giant
Alibaba Group Holding Ltd. in
a series of transactions in
2010 and 2011.
Ant has since become one
of China’s largest and most
valuable privately owned financial institutions, serving
hundreds of millions of Chinese citizens who use its payments network Alipay for everything from daily purchases
to investing in mutual funds.
Ant has also expanded globally, but what it has long
lacked is a significant presence in the U.S. Its $1.2 billion
deal for MoneyGram would
have given Alipay an instant
foothold in America and the
ability to market its services
to MoneyGram customers, who
have roughly 2.4 billion banking or mobile accounts in 200
HOANG DINH NAM/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY LIZA LIN
AND CHUIN-WEI YAP
An oil facility in Iran. Antigovernment protests in the nation have stoked worries about supplies.
Wednesday.
Meanwhile, a major winter
storm this week helped support prices for crude and
products, on worries that
freezing temperatures could
affect refinery infrastructure
and lead to an increase in demand for materials such as
diesel and heating oil.
“Everybody’s happy to be
owning” crude, said Donald
Morton, senior vice president
at Herbert J. Sims & Co., who
oversees an energy trading
desk. “There’s nothing to stop
it at the moment.”
Traders are also looking to
government data to be re-
leased Thursday, detailing the
amount of crude sitting in
storage. Analysts and traders
surveyed by The Wall Street
Journal, on average, expect
that stockpiles declined by 4.7
million barrels in the week
ended Dec. 29.
The American Petroleum
Institute, an industry group,
said late Wednesday that its
own data for the week showed
a 5-million-barrel decrease in
crude supplies, a 1.9-millionbarrel rise in gasoline stocks
and a 4.3-million-barrel rise in
distillate inventories, according to a market participant.
Potential supply disruptions
have become more pronounced in recent months.
The unrest in Iran and geopolitical risk throughout the
Middle East, including Iraq,
has helped push oil prices
higher amid declining global
inventories and efforts by major oil exporters to curb production.
The Organization of the Petroleum Exporting Countries,
of which Iran is the third-largest member, and 10 producers
outside the group, including
Russia, agreed in November to
extend a deal to cut crude output by nearly 2% through the
end of this year.
HNA Group Co. has fallen
behind in repaying loans it obtained from employees and individual investors on an internet lending platform, another
sign that the Chinese conglomerate is having difficulty meeting some of its debt obligations.
A unit of HNA told employees in an email Tuesday that
payments on investment products they had purchased would
be delayed, according to a person familiar with the matter.
HNA employees as well as
outside investors are among
the customers of JBH.com, an
internet-based investment and
financing platform owned by
HNA that makes loans and
sells high-yielding investment
products that mostly mature
in under a year.
It was the second such notification that employees of the
sprawling airlines-to-hotels
conglomerate had received in
about a month, according to a
person familiar with the mat-
The delays are the
latest stumble in
HNA’s efforts to raise
capital.
ter. In an email in early December, the same unit acknowledged that the company
was late in repaying investors
who had bought short-term investment products that were
originally due Nov. 28.
At the time, it asked for
their patience and support and
pledged to repay them by Jan.
2 along with additional interest, according to a copy of the
email reviewed by The Wall
Street Journal.
The email this week said
the HNA unit now expects to
repay the money by Jan. 30,
the person said.
It isn’t known how much
HNA owes employees and
other individuals who bought
the investment products,
which in some cases had investment minimums of 50,000
or 100,000 yuan (about $7,700
or $15,400) and offered annualized yields of around 7% for
90-day investment periods.
Representatives of HNA had
no immediate comment.
The delays are the latest
stumble in HNA Group’s efforts
to raise capital and manage
billions of dollars in near-term
debt obligations. The company
has since 2015 undertaken an
aggressive global acquisition
spree that was largely financed
with debt, scooping up stakes
in Deutsche Bank AG, the Hilton hotel chain, asset-management firms, airport assets and
real estate outside China.
The group has estimated it
has around $100 billion in outstanding debt and has said
about a quarter of it is coming
due within a year.
In recent months, some
banks have been hesitant to
work with HNA after Chinese
regulators began scrutinizing
the company’s acquisitions and
its use of leverage. Some HNA
subsidiaries have had to pay
higher interest rates to borrow
in the bond market while others have canceled their bond
offerings, indicating nervousness among debt investors.
HNA has tried to reassure
investors by declaring it has
financial support from large
Chinese banks. In recent
weeks, it has also turned to
some of its most valuable assets—including its ownership
stakes in Deutsche Bank, Hilton Worldwide Holdings Ltd.
and Postal Savings Bank of
China—to raise additional cash
by increasing the size of margin loans backed by its shares
in those companies.
The group is also looking to
sell some overseas assets, including commercial buildings
in the U.S. and other countries.
JBH.com, founded in 2014,
says it sells a variety of investment products, makes
loans and sells insurance policies. At the end of June 2017,
the platform had about 16 million users and turnover of 71.1
billion yuan, a sum that represents the total value of transactions done on its platform,
according to JBH’s 2017 firsthalf report.
—Yifan Xie
and Anjani Trivedi
.
Thursday, January 4, 2018 | B13
THE WALL STREET JOURNAL.
MARKETS
Some Venezuela Bondholders Hit Pay Dirt
Those investors who
braved the country’s
risky debt have been
rewarded handsomely
fault provisions for other
debt, according to bond documents and legal specialists.
But lawyers say such a
move could lead to one of the
most complicated and contentious default proceedings in
history because of so many
competing claims on the same
assets. That is an outcome
bondholders seem eager to
avoid.
Instead, many investors
may prefer to hold on and
hope that the government will
continue to make some of its
payments. Even though Vene-
Venezuela’s bonds have
lost about three-quarters of
their value, reflecting a dozen
missed payments by the government and the state-owned
oil company.
But many of their bondholders are still feeling flush.
A number of investors have
made their money back and
more, thanks to coupon payments topping 13% and large
principal payments that typically begin three years before
a bond matures.
A recent example includes
bonds from state-oil company
Petróleos de Venezuela SA,
or PdVSA, which matured in
November. An investor who
purchased that debt at its low
of 38.626 cents in February
2016 recovered that initial investment nine months later,
according to Bulltick LLC, a
Miami-based financial firm
that specializes in Latin
America.
When PdVSA made the final principal payment in November last year, a few days
after it was due, investors
who got in at the February
low enjoyed a 181% return.
New York hedge fund Greylock Capital Management
LLC turned a quick $60 million profit after snatching up
bonds in August when prices
dropped and correctly guessing PdVSA would find a way
to pay investors in November
when the bond matured.
A few longer-term investors like T. Rowe Price Group
Inc. have also been rewarded.
The firm’s emerging-markets
FEDERICO PARRA/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY JULIE WERNAU
A building in Caracas depicts the eyes of late President Hugo Chavez. Investors with a high risk tolerance have been well compensated.
bond fund has beaten 83% of
peers over a three-year period through Jan. 2, according
to Morningstar Inc. data,
aided in part by holding Venezuelan debt when others were
lowering their exposure. Venezuela bonds accounted for
3.6% of T. Rowe Price’s
emerging-markets
bond
fund’s assets at the end of
November, more than two
times the country’s weighting
in the industry benchmark index.
Many emerging-market investors won’t get near Venezuela. Some have avoided the
country since a collapse in
the price of oil, the country’s
main export, strained the government’s finances. Since
then, many investors have believed that a Venezuelan default was only a matter of
time. On Tuesday, S&P Global
Ratings said Venezuela failed
to make $35 million in coupon
payments on a debt obligation.
But those with a higher
risk tolerance have stuck
around, and many have been
well compensated.
“This has been extremely
lucrative for the people
who’ve had the daring to participate in the market,” said
Gregan Anderson, a macroeconomic strategist at Bulltick. “They’ve been able to
scoop up these bonds at rockbottom prices and reap huge
rewards as the government
cut back on virtually every
other kind of expense to make
those payments.”
Total returns for the Venezuela portion of the JP Morgan EMBI Global Diversified,
the most widely tracked Venezuelan bond index, doubled
over 16 months for investors
who got in early 2015, after
oil prices starting dropping at
the end of the previous year.
Even investors who bought
the highest-yielding bonds at
100 cents on the dollar would
make that initial investment
back within 7½ years, before
seeing a single principal payment, according to analysts.
These gains stand in contrast to the fallout after many
other government defaults, in
which bondholders suffered
steep losses and then pressed
quickly to demand full payment through the courts.
Holders of at least a quarter of any Venezuelan bond
can declare a default after a
missed payment and demand
full payment on the bonds.
That would trigger cross-de-
BY BEN EISEN
Just because stocks had a
banner year in 2017 doesn’t
mean they have to have a bad
year in 2018.
The 19% rise in the S&P 500
last year and the 25% gain in
the Dow Jones Industrial Average have fueled expectations
for more volatility in 2018. For
example, Byron Wien, the
Blackstone Group LP vice
chairman who has been mak-
8%
Average rise in S&P year after it
rose at least 19% in a year
ing a widely watched list of
year-ahead predictions for
more than three decades, said
in his newest list Tuesday that
he believes there will be a correction of at least 10%.
Given how calm 2017 was, it
would be practically unheard
of for the market to get any
calmer in 2018. That doesn’t
mean stocks have to end the
year lower than where they
started. With corporate earnings growing briskly and
global economic growth accel-
erating, many investors see
more gains ahead. That includes Mr. Wien, who said he
believes stocks will finish the
year higher, despite the correction he expects to hit at
some point in the next 12
months.
Continued gains have been
the case after strong years for
stocks more often than not.
When the S&P 500 has risen
at least 19% in a year, it has
climbed 68% of the time the
next year, or 17 out of 25
years, according to The Wall
Street Journal’s Market Data
Group. The average move has
been a rise of 8%.
Similarly, when the Dow
has finished the year up at
least 25%, something it has
done 23 times, the following
year has offered up an average
gain of 9.6%.
It has been up 15 of those
years. When the Nasdaq Composite has risen at least 28%,
like it did last year, it has averaged a gain of 17% the following year, the Market Data
Group found.
That isn’t to say there
won’t be more volatility along
the way. History isn’t a perfect
guide to the future. But even
after the market strength of
2017—and perhaps because of
it—it looks a bit early to call
time on this bull market.
Natural Gas Declines
On Production Worries
BY STEPHANIE YANG
Natural-gas prices retreated
Wednesday, ending a weatherdriven rally as doubts emerged
over the length of the cold
spell and high levels of U.S.
production.
Futures for February delivery fell 4.8 cents, or 1.6%, to
$3.008 a million British thermal units on the New York
Mercantile Exchange, breaking
a four-session winning streak
that took prices to a onemonth high.
The market has rallied on
recent weather-driven demand, which is expected to
continue through the weekend
as an arctic blast boosts demand for natural gas in heating.
However, analysts said that
weather forecasts already are
showing the cold weather
abating toward the end of January, putting pressure on the
market.
“After this strong recovery
the market is reassessing its
position before attempting to
build any further,” said analysts at Gelber & Associates.
Meanwhile, U.S. production
has risen steadily through the
end of 2017.
While freezing temperatures have disrupted some
supply, some traders remain
concerned that activity could
bounce back quickly once the
cold subsides.
Analysts and traders surveyed by The Wall Street Journal expect stockpiles to have
declined by 222 billion cubic
feet last week.
The data are due Thursday
at 10:30 a.m. EST.
PAUL J. RICHARDS/AGENCE FRANCE-PRESSE/GETTY IMAGES
Stocks Can Build
Off Strong 2017
D.R. Horton, PulteGroup and Lennar stocks jumped after a strong U.S. construction-spending report.
Home Builders’ Shares Soar
BY BEN EISEN
A rebound in the market for
new homes is propelling
shares of the companies that
build them, a sign of how the
improving economy has supported the stock market’s recent gains.
D.R. Horton Inc. jumped
92% over the past 12 months,
while PulteGroup Inc. rose
85%. Lennar Corp., which
agreed to buy CalAtlantic
Group Inc. in an October deal
that makes it the country’s
largest home builder by revenue, increased 59%. The S&P
500’s home-building subindustry grouping, which is made
up of those three companies,
added $19.2 billion to its market capitalization over that
span, a rise of 73%.
All three stocks jumped
Wednesday, with D.R. Horton
up 3.5%, PulteGroup up 2.7%
and Lennar up 3.7%.
That came after Commerce
Department data showed that
spending on construction
products grew by 0.8% in November from a month earlier,
above the 0.5% rise forecast
by economists. The rise was
due to a pickup in home building, as well as office and property construction.
The SPDR S&P Homebuilders exchange-traded fund,
which also includes buildingproducts and home-furnishings companies, rose 32% in
the past 12 months, topping
the S&P 500’s 20% gain.
In the past year, the supply
of housing has tightened, particularly in cities such as Denver and Atlanta where demand
for homes has been growing,
according to Jay McCanless,
Building Up
The S&P 500's three home-builder stocks are up sharply over the past
12 months, propelling an exchange-traded fund that tracks the sector.
Market value, in billions
Change since Jan. 3, 2017
40%
Jan. 3, 2018
D.R. Horton
Jan. 3, 2017
SPDR S&P Homebuilders ETF
S&P 500
30
20
Lennar
10
PulteGroup
0
5
10
15
$20
Source: FactSet
an analyst at Wedbush Securities. That, coupled with robust
jobs growth and still-low
mortgage rates, may continue
to bolster the market.
“Especially as millennials
begin to enter the prime
homeownership phase, I think
that will be a tailwind,” he
said.
A measure of builder confidence in the market for new
single-family homes jumped
last month to its highest in
more than 18 years, another
sign of momentum in the sector.
“Our continued confidence
in the home-building industry
is reinforced by low rates,
tight supply, strong demand
and expanding household formations,” said Robert Francescon, co-chief executive officer and director at home
builder Century Communities,
in a November earnings call.
That said, the sharp rise in
home-builder valuations over
the past year has left some
0
2017
THE WALL STREET JOURNAL.
concerned that the market is
getting ahead of improvement
in the underlying housing
market, which was hard hit
during the financial crisis.
“Housing
fundamentals
lacked the kind of crispness
one might have expected given
the stock-price performance,”
said Stephen Kim, an analyst
at Evercore ISI, in a note to
clients Wednesday, referring
to gains over the past year.
One wild card for the sector
is the federal tax-code overhaul recently signed into law.
A cap on mortgage interest
deductions could weigh on demand for new homes above
the $750,000 limit, though Mr.
McCanless noted that it would
likely have a limited effect on
most home builders. A drop in
the corporate tax rate could
increase home-builder profitability and any pickup in the
economy due to the overhaul
could increase demand by giving buyers more money to
spend on homes, analysts say.
‘The payments are
coming late, but
they’re coming,’ says
Jay Auslander.
zuela and PdVSA have missed
12 bond payments since October, the government has continued to make other bond
payments to PdVSA and sovereign debtholders.
“The payments are coming
late, but they’re coming,” said
Jay Auslander, a partner at
Wilk Auslander, whose practice focuses on judgment enforcement and distressed debt
litigation. “It’s better to bide
your time and wait than to
get involved in litigation that
could take years.”
Major bond-rating firms
downgraded the government
and PdVSA to default status
after they missed several interest payments in late 2017.
The South American country
has said it wants to restructure its remaining debt, which
analysts put as high as $150
billion, compared with international reserves of about $10
billion.
Treasury
Yields Fall
After Fed
Minutes
BY AKANE OTANI
U.S. government bond
prices firmed Wednesday as
minutes from the Federal Reserve’s latest meeting showed
officials debated
CREDIT
whether tax cuts
MARKETS would require
them to alter
their plan for
rate increases in 2018.
The yield on the benchmark
10-year U.S. Treasury note settled at 2.445%, compared with
2.465% Tuesday.
Yields, which fall as bond
prices rise, pared overnight
declines after data showed the
U.S. factory sector gained momentum in December.
The Institute for Supply
Management said Wednesday
that a measure of sales at factories rose in December to the
highest level since early
2004—the latest sign of
strength among U.S. manufacturers.
Upbeat economic data tend
to weaken demand for assets
that investors see as havens,
including Treasurys.
Later Wednesday, the yield
on the 10-year note briefly
jumped after minutes from the
Fed’s December policy meeting
showed officials debated
whether tax cuts passed by
Congress would require them
to raise short-term interest
rates faster in 2018.
Officials discussed the possibility “that inflation pressures could build unduly. perhaps owing to fiscal stimulus
or accommodative financial
market conditions,” the minutes said. Fed officials have
penciled in three rate increases in 2018 and two in
2019.
A pickup in growth and inflation spurred by tax cuts
could prompt the Fed to raise
rates faster than expected, potentially putting pressure on
bond prices—although some
investors and analysts have
expressed skepticism that the
tax package will have a major
effect on inflation.
Tepid inflation had kept
pressure on longer-term Treasury bond yields throughout
2017, with the yield on the 10year note ending the year at
2.409%, slightly below where
it settled at the end of 2016.
.
B14 | Thursday, January 4, 2018
THE WALL STREET JOURNAL.
* ***
MARKETS
Tech, Energy Propel Stocks to Records
Nvidia, Intel among
biggest gainers; Scana
soars after news of
takeover by Dominion
Semiconductor and technology stocks lifted the S&P
500 to a fresh record Wednesday, while Treasurys
and other assets swung following minutes from
the Federal Reserve's latest meeting.
10%
8
6
BY AMRITH RAMKUMAR
AND MIKE BIRD
Technology firms pushed
major U.S. stock indexes to records Wednesday, a day after
the Nasdaq Composite closed
above 7000 for the first time.
Rallying
semiconductor
stocks have boosted the
broader technology sector at
the start of 2018, after the
PHLX Semiconductor Index
added nearly 40% last year.
Makers of
WEDNESDAY’S c o m p u t e r
MARKETS
chips
recently have
gotten
a
boost from a Semiconductor Industry Association report that
showed a 21.5% increase in
world-wide chip sales in November from the same month a
year earlier, according to analysts.
Despite concerns that technology stocks have gotten
pricey relative to earnings,
some investors think continued
strength in profits and sales
could justify further share-price
gains.
“As long as you’ve got the
growth, I think you can make
the case that your trajectory is
going to continue to go up
without too much of a bubble
fear,” said Katrina Lamb, head
of investment strategy and research at MV Financial.
The Dow Jones Industrial
Average added 98.67 points, or
0.4%, to 24922.68. The S&P 500
rose 17.25 points, or 0.6%, to
2713.06 and the Nasdaq
climbed 58.63 points, or 0.8%,
to 7065.53, posting its best
two-day stretch since June
2016.
Nvidia climbed $13.12, or
6.6%, to $212.47. Advanced Micro Devices added 0.57, or
5.2%, to 11.55.
4
2
0
PHLX Semiconductor Index
Advanced Micro Devices
–2
Nvidia
–4
Intel
–6
–8
9:30
10
11
Yield on Treasury note
Two year
1
S&P 500
2.46
1.92
2.45
1.91
2.44
8
10
noon 2
S&P 500 financials
–0.4
–0.8
–1.2
2:40 4
6
8
10
noon 2
9:30
10
WSJ Dollar Index
$62.0 a barrel
85.90
11
noon
1
2
3
85.85
61.5
85.80
61.0
85.75
85.70
60.5
85.65
60.0
85.60
12 a.m.
2
4
6
10
8
noon
2
12 a.m. 2
4
6
Sources: FactSet; WSJ Market Data Group (WSJ dollar index)
Intel shares fell 1.59, or
3.4%, to 45.26 after a British
publication, the Register, reported that some Intel processors have a fundamental design
flaw that would require a significant security update of Linux and Windows operating
systems. The S&P 500 information technology sector rose
8
10
noon
2
4
THE WALL STREET JOURNAL.
1.1%.
Energy stocks also were
among the biggest gainers,
climbing alongside crude oil
prices amid antigovernment
protests in Iran that could lead
to supply disruptions. The S&P
500 energy sector rose 1.5% as
U.S. crude closed at its highest
since December 2014.
Scana shares climbed 8.78,
or 23%, to 47.65 after Dominion
Energy said it has struck a deal
to buy the troubled energy firm
in an all-stock transaction valued at about $7.66 billion. Dominion Energy shares declined
3.09, or 3.8%, to 77.19.
Stocks extended gains after
minutes from the Federal Re-
serve’s December meeting
showed most officials backed
continued gradual rate increases.
Officials expressed growing
confidence in the strength of
the labor market broadly and
discussed how tax cuts approved by Congress could boost
economic growth, a favorable
HEARD ON THE STREET
FINANCIAL ANALYSIS & COMMENTARY
Natural-Gas Market Feels Chill
Fill ’Er Up
Natural gas in U.S.
underground storage
4 trillion cubic feet
3
2
1
0
2014
’15
’16
’17
Sources: Energy Information Administration;
EBW Analytics weekly forecast
THE WALL STREET JOURNAL.
late-winter market rallies
have erupted when projections have shown inventories
dipping below one trillion
cubic feet.
Until just before Christmas, the amount of gas in
storage was 3.332 trillion cubic feet, slightly below the
five-year average. The nasty
cold snap of the past two
weeks will change that. Data
from the U.S. Energy Information Administration on
Thursday should show the
biggest withdrawal of the
season by far. That will likely
be topped next week.
The National Oceanic and
Atmospheric Administration
expects heating-degree days,
a measure of heating demand, to be more than 60%
above normal in New England and the Mid-Atlantic
states this week on a gasheating weighted basis. By
contrast, heating-degree
days in the second half of
2017 were about 10% below
normal for the U.S. as a
whole.
A cold snap is only a concern if it lasts a long time. If
the Northeast returns to a
weather pattern identical to
the last three months of
2016-17’s mild heating season, storage would be above
1.84 trillion cubic feet in
early April. But a repeat of
2013-14’s weather pattern
could put gas in underground
storage well into the danger
zone with 850 billion cubic
feet in sight by late March.
In 2014, storage plunged to
824 billion cubic feet.
Traders didn’t wait for inventories to fall that low,
though. In the six weeks
leading up to Feb. 21, the
coldest part of that frigid
winter, futures prices rallied
by 54% as storage fell by
nearly 1.4 trillion cubic feet.
While “six more weeks of
winter” is a folk tale, the gas
market’s margin for error is
getting narrower and traders
aren’t taking any chances.
—Spencer Jakab
Utility Bid Is a Deal Maker’s Delight
Dominion Energy’s proposed $7.7 billion bid for
Scana Corp. is nothing short
of masterful—a bold move to
take advantage of its merger
target’s and local politicians’
misfortunes. At first glance,
the all-stock deal comes with
some unusually generous
sweeteners meant to appeal
not only to shareholders but,
as is often the case in utility
deals, to rate payers as well.
Dominion stock was off 3.9%
Wednesday.
Scana’s value has been
dented since last July after a
subsidiary halted work on a
failed nuclear-plant project.
As regulated utilities are entitled to do, the company
was collecting payments
from customers to cover the
multibillion-dollar costs of
the plants over 50 years. But
angry politicians threatened
to halt the payments, sending the market value of
Scana down by $4.8 billion
between June and December,
S&P 500 utilities
0
U.S. crude-oil price
Email: heard@wsj.com
Natural-gas traders
started the year spooked by
the shadow of 2014.
Fueled by the deep freeze,
futures prices continued
their late December rally into
the new year, rising 17% over
just seven trading sessions.
There are good arguments
for why prices may sputter
in the next several weeks,
but the prospect of a nailbiting end to “withdrawal
season” can’t be ruled out.
The U.S. is now less than
halfway through the fivemonth stretch when heating
demand puts the market into
deficit, forcing utilities to
withdraw gas from underground storage. Although
there always has been
enough gas put away during
the April-through-October
“injection season” to keep
Americans warm, ferocious
4
0.4
2.43
1.90
6
3
0.8%
2.47%
1.93
2:40 4
2
Index performance
10-year
MINUTES
RELEASED
1.94%
noon
Bargain Bin
Scana market value
$11 billion
10
9
8
7
6
5
2017
Source: FactSet
when speculation about a
possible deal surfaced.
Dominion’s offer would
pay affected customers
around $1,000 on average, or
$1.3 billion in total, within
90 days plus a 5% rate reduction, of which 3.5 percentage
points is a rebate of $575
million that customers al-
’18
THE WALL STREET JOURNAL.
ready paid for the failed
plants. Much of that money
is retroactive and thus is a
lot cheaper after tax than it
would have been in 2018. It
also would write off $1.7 billion of the plants’ value,
meaning it would stop collecting money for the plant
from rate payers after about
20 years, and spend $180
million to replace some of
the power the nuclear plant
would have generated. Those
concessions are worth
around $4 billion in nominal
dollars but less in today’s
money since the write-off affects forgone income in the
distant future.
In exchange for that, Dominion is demanding that authorities affirm that customers will pay the remainder of
the roughly $6 billion they
still owed for the plants.
South Carolina regulators
and politicians, on the hot
seat for the nuclear debacle,
will have a hard time saying
no to white knight Dominion
as it waves $1,000 checks.
Added up, Dominion is
paying around $7.43 billion
excluding debt for a company that would have cost it
$14 billion last summer with
a similar deal premium. A
master stroke.
—Spencer Jakab
development for stocks, said
Paul Townsen, managing director at Crossmark Global Investments. Investors have said the
central bank’s gradual pace
given steady economic growth
could help stocks keep rising.
“That sentiment was already
built into the markets,” Mr.
Townsen said. “This was pretty
much the status quo.”
The yield on the benchmark
10-year U.S. Treasury note settled at 2.445%, down from
2.465% Tuesday. Yields fall as
bond prices rise. The 10-year
yield has rebounded from its
September lows, when it closed
as low as 2.058%.
The dollar steadied after
falling for a seventh straight
session Tuesday, with the WSJ
Dollar Index—which tracks the
U.S. currency against a basket
of 16 others—up 0.2% from its
lowest level since September.
Elsewhere,
technology
stocks propelled the Stoxx Europe 600 index to a 0.5% gain.
The euro fell 0.4% against the
dollar, after hitting its highest
closing price in three years
Tuesday.
Some investors expect the
euro to continue strengthening
on the back of unexpectedly
strong economic conditions.
“Europe continues to enjoy
the most important growth acceleration that we’ve seen in
over a decade,” said Alessio DeLongis, portfolio manager at
OppenheimerFunds.
“We think it’s an environment that’s conducive to inflows into Europe, into equities
particularly, and therefore into
the euro,” he added.
The Tokyo market reopened
Thursday after an extended
holiday. The Nikkei 225 was up
2.5% at midday. The Shanghai
Composite Index, which added
0.6% Wednesday, was up 0.3%
early Thursday. Hong Kong’s
Hang Seng Index on Wednesday
closed up 0.1%—its highest
close in more than a decade.
Early Thursday, it was up 0.1%.
—Kenan Machado
contributed to this article.
WSJ.com/Heard
Ant-MoneyGram Spells
End of China-U.S. M&A
When even Jack Ma can’t
get a deal done, it is time to
call an end to meaningful
Chinese acquisitions in the
U.S. Just a year ago, then
President-elect Donald
Trump boasted that he and
Mr. Ma—China’s best-known
businessman and the founder
of tech giant Alibaba—would
“do great things” together,
amid talk of creating one
million American jobs.
Not so much. Even Mr.
Ma’s assiduous efforts to
play to the current nationalistic tone in Washington
haven’t been enough to ensure the approval of Alibaba
affiliate Ant Financial’s
planned $1.2 billion acquisition of U.S. based money
transfer company MoneyGram International Inc. The
deal was blocked Tuesday by
the Committee on Foreign
Investment in the United
States (CFIUS), a multiagency government panel
that normally scrutinizes
deals for potential impact on
national security.
An Ant-Moneygram tie-up
raised some concerns about
the protection of U.S. customers’ data, mostly stoked
by rabble rousing from Kansas-based Euronet Worldwide, a rival bidder for MoneyGram. And it is true that
China isn’t the most open
country to foreign ownership.
Even so, Beijing has softened its attitude somewhat
recently, relaxing its foreigninvestment policies to lure
more capital into specific
sectors, including financial
services. With the CFIUS decision on Ant and MoneyGram, it is clear such moves
aren’t going to be met with
much reciprocity.
For investors, the takeaway is that the “China bid”
that has helped boost global
asset prices this century may
be gone for good, at least in
developed markets. Beijing
has been cracking down on
asset buying abroad by busy
acquirers like Anbang Insurance and HNA Group.
Money from China could still
find a home in favored sectors like high-end manufacturing. But with Washington
now joining in the protectionism party, the future for
deal making looks bleak indeed.
—Anjani Trivedi
OVERHEARD
A startup’s assets are for
sale, lock, stock and barrel. The
lock may even be worth something.
Otto, which had invented
what it called “an easier way
to come and go,” informed investors and customers awaiting its products last week that
its namesake product “will not
ship and it may never ship.” After a potential acquirer walked
away in December, the maker
of $699 Bluetooth and Wi-Fi
smart locks ran out of cash.
What it has, though, is what
sounds like a nifty, if pricey,
product with sophisticated en-
cryption built using top-grade
materials. There are even some
completed ones sitting in a
warehouse, according to TechCrunch, awaiting a solvent
company to deliver them. Early
buyers who had expected installation of the locks in the fall
probably will never see them.
Aside from losing money,
the company’s early backers
such as Reid Hoffman, the cofounder of LinkedIn, probably
feel a bit silly. So do preorder
customers, but they can look
on the bright side: At least
they didn’t shell out the same
amount for a Juicero.
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