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The Wall Street Journal - March 15, 2018

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DJIA 24758.12 g 248.91 1.0%
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heranos CEO Holmes
agreed to settle SEC securities-fraud charges in a
deal that strips her of voting control and requires her
to pay a $500,000 fine. A1
Disney is reorganizing
its operations in a move
that positions two top executives as potential successors to CEO Iger. A1
The Senate approved
legislation to ease crisisera regulations for small
and midsize banks. A3
Toys “R” Us told employees that the struggling
big-box retailer will sell or
close all its U.S. stores. B1
A former Equifax executive was charged with insider trading tied to last
year’s massive data breach. B1
Retail sales fell in February despite a thriving economy, puzzling analysts. A2
Stocks fell amid renewed
worries about protectionist
trade policies. The Dow shed
248.91 points to 24758.12. B11
U.S. importers will face
high hurdles to avoid steel
and aluminum tariffs under
new government rules. A8
U.S. tech firms could see
fines and tougher tax rules
in Europe amid rising transAtlantic trade tensions. B4
A Chinese oilman who shot
from obscurity to spearhead
multibillion-dollar deals is under investigation in China. B1
Glencore has agreed to
sell a big supply of cobalt, a
key metal in electric-car batteries, to a Chinese firm. B6
Saudi Arabia said it would
continue to curb oil output, underscoring a split with Iran. B6
World-Wide
Documents tie Trump’s
flagship holding company
to the continuing effort to
silence a former adult-film
actress who says she had
an affair with Trump. A1
Britain is expelling 23
Russian diplomats, saying
Moscow is culpable for the
poisoning of a former spy
and his daughter. A1
Democrat Lamb claimed
victory with a razor-thin
lead in Pennsylvania’s special U.S. House election. A3
CNBC analyst Kudlow
was named to succeed Cohn
as Trump’s National Economic Council director. A4
The White House is bracing
for more changes in the administration after the departures of Tillerson and Cohn. A4
GOP Sen. Paul said he
would oppose Trump’s
nominees for secretary of
state and CIA director. A4
Students across the U.S.
walked out of school to
protest government inaction on gun control. A7
The commander of U.S.led forces in Afghanistan said
prospects for reconciliation
between Kabul and the Taliban are improving. A10
China is sidelining a family-planning bureaucracy
originally set up to manage
Beijing’s one-child policy. A20
Slovakia’s prime minister
offered to resign in the
wake of the country’s biggest protests since the fall
of communism. A11
Lebanon is seeking aid
from allies as it faces tensions on the Syrian border
and financial strains. A10
Markets............. B11-12
Opinion.............. A17-19
Sports........................ A16
Technology............... B4
U.S. News............. A2-8
Weather................... A16
World News... A10-11
>
ROLL CALL: Students nationwide walked out of class Wednesday on the one-month anniversary of the Parkland, Fla., school shooting to call
for action on gun control. Clockwise from left, students held protests in Washington, D.C., New York City and Tucson, Ariz. A7
Trump Firm Tied to Silencing Deal
Lawyer to president’s
company is listed as
counsel in arbitration
case with ex-porn star
BY MICHAEL ROTHFELD
AND JOE PALAZZOLO
Documents marked “HIGHLY
CONFIDENTIAL PROCEEDING”
for the first time tie President
Donald Trump’s flagship holding company to the continuing
effort to silence a former adultfilm actress who says she had
Disney Moves
Reboot Race
For Successor
To CEO Iger
an affair with Mr. Trump.
A Trump Organization lawyer, Jill A. Martin, is listed as
counsel in an arbitration demand for Essential Consultants
LLC, a Delaware company
formed by Mr. Trump’s personal lawyer and used to pay
$130,000 to Stephanie Clifford
in exchange for her silence, according to Feb. 22 arbitration
documents filed in Orange
County, Calif.
At issue is a high-profile
battle between Mr. Trump’s
personal lawyer and Ms. Clifford, also known as Stormy
Daniels. Michael Cohen, Mr.
Trump’s lawyer, has obtained a
temporary restraining order
against Ms. Clifford in the arbitration to stop her from talking about an alleged 2006 sexual encounter with Mr. Trump.
Ms. Clifford has asked a judge
to declare the nondisclosure
agreement invalid.
The White House and Mr.
Cohen repeatedly have sought
to distance the president
from the porn-star pact and
payment.
Mr. Cohen, who was employed by the Trump Organi-
TV Commentator Is Trump Pick
LONDON—Prime Minister
Theresa May said the U.K. is
kicking out 23 Russian diplomats, its single biggest expulsion in more than three decades, and described Moscow
as showing complete disdain
for the gravity of the use of a
nerve agent on British soil.
In the most dramatic diplomatic confrontation between
London and Moscow since the
end of the Cold War, Mrs. May
on Wednesday said the Russian state was culpable for the
attempted murder of Sergei
Skripal, a 66-year-old former
Russian spy, and his daughter
Yulia, 33, earlier this month.
Moscow missed a midnight
Tuesday deadline to explain
how Mr. Skripal, a former informant for Britain’s foreign
intelligence service, was poisoned with a deadly Soviet-era
nerve agent. He and his
daughter are in critical but
stable condition.
zation when he brokered the
deal with Ms. Clifford shortly
before the 2016 presidential
election, has maintained he
was acting on his own and has
called it a “private transaction.” Soon after Mr. Trump’s
electoral victory, Mr. Cohen
left the company to establish
Please see TRUMP page A7
White House braces for more
staff changes............................. A4
Rand Paul to oppose State,
CIA nominees............................ A4
High bar is set for tariff
exclusions.................................... A8
Theranos
And CEO
Punished
In Fraud
Theranos Inc. Chief Executive Elizabeth Holmes, widely
hailed as Silicon Valley’s first
female billionaire startup
founder, agreed to a settlement with federal regulators
that strips her of voting control, bans her from being an
officer or director of any public company for 10 years and
requires her to pay a $500,000
penalty.
The deal is another devastating blow in the 15-year history of a company that set out
to revolutionize the bloodtesting industry.
The agreement was announced Wednesday by the
Securities and Exchange Commission, which filed civil securities-fraud charges against
Ms. Holmes, the company and
a former Theranos president.
Regulators alleged they raised
more than $700 million from
investors while deceiving them
about the capabilities of the
company’s technology.
Ms. Holmes, 34 years old,
and Theranos neither admitted
nor denied wrongdoing. In a
statement, the company said it
and Ms. Holmes “fully cooperated with the SEC throughout
its investigation.” Theranos’s
independent directors said the
Newark, Calif., company “is
pleased to be bringing this matter to a close and looks forward
to advancing its technology.”
The SEC began investigating Theranos after The Wall
Street Journal reported in October 2015 that the lab instrument developed as the linchPlease see HOLMES page A6
Stock Traders Race
The Closing Bell
Around 3:40 p.m. on a recent trading day, a dozen or
so brokers at the New York
Stock Exchange hustled back
to their posts after bathroom
breaks and a last coffee.
By Corrie Driebusch,
Alexander Osipovich
and Gregory
Zuckerman
Lawrence Kudlow, a conservative commentator who appears on
CNBC, will become one of President Donald Trump’s top economic
advisers as director of the National Economic Council. A4
U.K. Expels Russians
Over Spy’s Poisoning
BY JENNY GROSS
YEN 106.32
Index funds stir a frenzy in the day’s final
auction at the New York Stock Exchange
BY BEN FRITZ
Walt Disney Co. is reorganizing its operations in a move
that positions two top executives as potential successors
to Chief Executive Robert Iger.
Kevin Mayer, the company’s
longtime head of strategy who
has specialized in acquisitions
and digital investments, was
named chairman of a new direct-to-consumer and international segment, while parks
chief Robert Chapek added
consumer products to his
portfolio, giving him oversight
of what would be the company’s biggest business unit by
revenue and profit.
Wednesday’s moves come a
week after Disney made former consumer products head
James Pitaro the head of
Please see DISNEY page A11
EURO $1.2369
BY JOHN CARREYROU
RICHARD DREW/ASSOCIATED PRESS
T
CLOCKWISE FROM LEFT: MICHAEL REYNOLDS/EPA/SHUTTERSTOCK; SPENCER PLATT/GETTY; MIKE CHRISTY/ARIZONA DAILY STAR/AP
Business & Finance
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A Day of Protests Brings Out a Million Students Across the U.S.
What’s
News
CONTENTS
Business News.. B3,6
Capital Account.... A2
Crossword.............. A16
Heard on Street. B12
Life & Arts...... A13-15
Management.......... B5
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THURSDAY, MARCH 15, 2018 ~ VOL. CCLXXI NO. 61
* * * * * *
“This represents an unlawful use of force by the Russian
state against the United Kingdom,” Mrs. May said in the
House of Commons. “In the aftermath of this appalling act
against our country, this relationship cannot be the same.”
Despite the strong rhetoric,
analysts said the U.K. government’s response was measured
and moderate, suggesting that
British officials were reserving
stronger measures—such as
expelling the Russian ambassador to the U.K. or leveling
new sanctions on figures close
to President Vladimir Putin—
in case of further escalation
between London and Moscow.
“I expected a stronger reaction, but I can understand the
need for caution,” said Jonathan Eyal, international director at the Royal United Services Institute, a security think
Please see RUSSIA page A10
May seeks legislation similar
to U.S. Magnitsky Act........ A10
An Eye-Roll
Captivates
A Nation
i
i
i
Beijing confab’s
big take-away: a
look of disdain
BY TE-PING CHEN
AND CHUN HAN WONG
BEIJING—The eye-roll that
transfixed the nation came on
a day of tightly choreographed
political theater.
For the past week or so,
delegates to China’s National
People’s Congress have droned
about government policy,
stopping occasionally to field
prearranged questions.
Then came the drama of the
two reporters, one in red, one
in blue.
Midway through a news
briefing Tuesday, the blue-clad
reporter had enough. A fellow
journalist in a red jacket beside her was asking how BeiPlease see EYE page A12
They strapped on headphones to prepare for the
closing minutes of the U.S.
stock market—the pinnacle
moment for investors worldwide.
As the clock neared 4
p.m., a buzz grew on the
trading floor of mutual-fund
giant Vanguard Group 100
miles away in Malvern, Pa.,
while Michael Buek, head of
U.S. equity trading, and his
team prepared billions of
dollars in trades.
In downtown Milwaukee,
Michael Antonelli, a trader
for R.W. Baird & Co., joined
the late-day countdown, poring through data from exchanges while entering stock
orders for large mutual- and
pension-fund clients.
Millions of investors,
from retired teachers to
hedge-fund titans, rely on
the footwork of such traders
in the run-up to 4 p.m.,
when exchanges like the
NYSE and Nasdaq Inc. conclude the day with a burst
Please see STOCKS page A12
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THE WALL STREET JOURNAL.
A2 | Thursday, March 15, 2018
U.S. NEWS
CAPITAL ACCOUNT | By Greg Ip
Seeds of Instability Are Germinating Again
Since the
bailout of
Bear Stearns
Cos. a decade
ago this week
and the failure of Lehman Brothers six
months later, regulators have
made it their mission to prevent a repeat.
Yet even though a big financial-firm collapse in the
near future is exceedingly
unlikely, another crisis isn’t.
Bear and Lehman were the
manifestation of deeper economic forces that since the
1970s have produced crises
roughly every decade. They
are still at work today: ample
flows of capital across borders, mounting debts owed
by governments, corporations and households, and ultralow interest rates that
nurture risk-taking in hidden
corners of the economy.
For a quarter-century after World War II, the world
was virtually crisis-free.
Widespread defaults during
the Great Depression and the
war left a relatively debtfree path for economic
growth, says Harvard University economist Kenneth
Rogoff, co-author with Carmen Reinhart of “This Time
is Different: Eight Centuries
of Financial Folly.” Capital
controls limited how much
money could cross borders,
while rules such as interestrate ceilings limited who
could borrow and how much.
B
y the early 1980s,
though, deregulation
had allowed capital to
flow freely within and across
borders and crises became a
regular occurrence: the Latin
American debt crisis that began in 1982, the U.S. commercial real-estate and savings-and-loan crisis of the
1980s, the Asian and Russian
financial crisis of 1997-98,
the dot-com bubble of
1998-2000, the U.S. mortgage
crisis of 2007-09 and the European sovereign-debt crisis
of 2009-13, interspersed with
country-level crises.
Bear was both facilitator
and victim of a housing bubble inflated by low interest
rates and huge inflows of foreign capital—a “global saving
glut” as then-Federal Reserve
Chairman Ben Bernanke put
it. It arranged mortgages that
financed the housing bubble
while borrowing heavily with
short-term IOUs. When those
mortgages went bad, Bear’s
creditors yanked their funds,
a de facto run on the bank.
Most of the regulatory effort since has been to ensure
looks pretty remote.
But Hyun Song Shin, research chief at the Bank for
International Settlements,
warned in a 2014 speech
against the tendency to “focus on known past weaknesses rather than asking
where the new dangers are.”
Banks may be stronger than a
decade ago, but the financial
system hasn’t returned to its
pre-1980 repressed state.
Mr. Shin pointed out that
bond markets are growing at
the expense of banks in supplying credit, enabling business and government debt
loads in many countries to
surpass their precrisis peaks.
Emerging markets have borrowed heavily in dollars,
which leaves them vulnerable
should the dollar’s value rise
sharply.
Total U.S. debt, at around
250% of GDP, still stands at
crisis-era peaks while debt
levels in China have caught
up and passed the U.S., according to the BIS. U.S. companies’ debts had reached
34% of assets by the end of
2016, the highest at least
since 2000. Debt-servicing
burdens haven't risen commensurately thanks to low
inflation and low rates, but
they have begun climbing.
More than $1 trillion a year
Debts Roll On
Cross-border capital flows and debt growth haven’t let up since
the crisis.
Total capital flows*
Into emerging
markets,
excluding China
Total debt to GDP†
Into China
$2.0 trillion
China
Government
Private
250%
1.5
200
1.0
150
0.5
100
0
U.S.
Government
Private
50
–0.5
2000
0
’05
’10
’15
1995
2000
’05
’10
’15
*Figures for 2018-19 are projections
†Excludes financial sector
Sources: Institute of International Finance (emerging-market capital flows);
Bank for International Settlements (China, U.S. total debt)
THE WALL STREET JOURNAL.
the largest financial institutions such as JPMorgan
Chase & Co., which bought
Bear Stearns in a fire sale
brokered by the Fed, don’t
succumb to anything similar:
thicker buffers of capital to
absorb losses, more reserves
of cash and liquid assets to
pay off skittish creditors, restrictions on trading and
compensation that incentivize risk-taking, and new procedures for winding down
failing institutions without
taxpayer bailout or a chaotic
bankruptcy. Though President
Donald Trump’s appointees
and Congress are beginning
to dial back the regulations,
the failure of a systemically
important institution now
WASHINGTON—The U.S.
job market is booming and
workers’ paychecks are growing thanks to a tax cut and
raises. But Americans hunkered down on spending last
month, a puzzle for an economy that leans heavily on
their willingness to consume.
Sales at U.S. retailers fell
0.1% in February, marking a
three-month slide. Much of
the decline was tied to lower
sales of cars and weak gasoline prices. Americans also reduced shopping for furniture,
health products, groceries and
electronics.
February was when many
Americans saw the first tangible evidence of the $1.5 trillion tax cut President Donald
Trump signed into law late
last year. Tax withholdings
fell, increasing take-home pay.
That boost—along with
high stock and property values, and a labor market that
has added an average of
242,000 jobs a month over
the past three months—is expected to prod Americans to
go out shopping. The hope is
that, in turn, factories will
Thrifty Shoppers
Retail sales, change from
a year earlier
10%
RECESSION
5
0
–5
–10
–15
2008
’10
’12
’14
’16
Note: Data are seasonally adjusted.
Source: Commerce Department
THE WALL STREET JOURNAL.
ramp up production and economic growth will pick up. So
far, that hasn’t happened.
“The consumer genuinely is
taking a little bit of a
breather,” said JPMorgan
Chase economist Michael Feroli. He struggled to explain
the latest dip but said the ingredients for stronger spending and economic growth are
still there. “We think the fundamentals are still supportive
of better growth ahead.”
Retail goods make up a big
portion of Americans’ spending and are thus a key barometer of the economy’s health.
The lower spending has led
economists to downgrade expectations for economic
growth in the first quarter.
JPMorgan now expects gross
domestic product to grow at
an annual rate of 2% this
quarter, while the Atlanta
Fed’s GDPNow model projects
1.9% growth. Each previously
projected 2.5% growth.
The economy grew 2.5% in
2017, in large part due to
strong consumer spending,
and for a stretch last year it
hit a 3% rate.
Economists said temporary
factors may have held back
consumers of late. Some families are receiving tax refunds
later than they did in previous years as the Internal Revenue Service takes more time
to combat fraud. Beyond that,
the government’s methods for
adjusting data for seasonal
factors likely haven’t yet fully
accounted for the delays, distorting the sales data.
Also,
consumers
who
boosted spending last fall to
repair and replace property
T
his tells us little about
when or where a crisis
will happen or what
may trigger it. Crises surprise
because they usually start
with an assumption so sensible that everyone acts on it,
planting the seeds of its own
undoing: in 1982 that countries like Mexico don’t default; in 1997 that Asia’s fixed
exchange rates wouldn’t
break; in 2007 that housing
prices never declined nationwide; and in 2011 that euro
members wouldn’t default.
James Bianco, who runs his
own financial research firm in
Chicago, speculates that the
equivalent today might be,
“We will never see higher inflation or higher growth.” If
either in fact occurs, the low
interest rates that have raised
household stock and property
wealth to an all-time high relative to disposable income
won’t be sustainable.
Central banks know this,
of course, which is one reason they are wary of raising
interest rates too quickly—
while nervous that if they
raise them too slowly, the
problem will get worse.
CORRECTIONS AMPLIFICATIONS
Consumer Spending Poses Quandary
BY JOSH MITCHELL
AND SARAH NASSAUER
still flows into emerging
markets each year, according
to the Institute of International Finance.
Russian banker Boris Berezovsky was found dead on his
bathroom floor with part of a
scarf around his neck in 2013,
while another opposition businessman, Alexander Perepilichny,
collapsed and died while jogging in 2012. A World News
article on Wednesday about
Russian exiles living in the
U.K. incorrectly transposed the
years of the men’s deaths.
damaged by hurricanes in the
South may have temporarily
cut back since then. Economists expect the storms’ effect on spending to fade.
And while the tax cuts
showed up last month in the
form of bigger paychecks, the
effects will likely be spread
over the year. The nonprofit
Tax Policy Center estimates
that, considering only the individual income-tax provisions, 65% of households will
get a tax cut averaging $2,180
in 2018. Some households will
get that over the course of
the year through lower withholding, but some won’t get it
until early 2019.
Americans haven’t cut
spending across the board. By
one measure, retail spending
looks stable. When excluding
cars and gasoline—for which
spending can swing wildly
month to month—retail sales
climbed 0.3% last month.
Americans boosted spending
on building supplies, clothing
and restaurant outings. Despite weakness in recent
months, retail sales have
grown 4% over the past year.
Slightly more than onethird of Rome’s public water is
either lost or illegally diverted
because the city’s infrastructure is decrepit. A World News
article Wednesday about the 5
Star Movement’s bid to govern
all of Italy after almost two
years in power in Rome incorrectly said nearly half of the
water is lost.
Laurence Norman contributed to a Page One article
Wednesday about the nomination of Mike Pompeo as secretary of state. In some editions
his first name was misspelled
as Lawrence.
Readers can alert The Wall Street Journal to any errors in news articles by
emailing wsjcontact@wsj.com or by calling 888-410-2667.
THE WALL STREET JOURNAL
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Heard on the Street: Don’t fret
about U.S. consumers......... B12
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THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | A3
* * * * * *
U.S. NEWS
DREW ANGERER/GETTY IMAGES
© D. YURMAN 2018
N O R T HPA R K C EN T ER
Democrat Conor Lamb declared victory Wednesday, while his opponent said he wouldn’t concede until all the votes were counted.
Lamb Claims Win in Pennsylvania
Both parties look to
learn from upset as
Democrat clings to
razor-thin advantage
Democrat Conor Lamb
claimed victory with a razorthin lead in Pennsylvania’s special election for a U.S. House
seat Wednesday, as members of
both parties sought strategic
lessons from the political upset.
By Reid J. Epstein,
Joshua Jamerson
and Janet Hook
Mr. Lamb’s Republican opponent, Rick Saccone, is declining to concede as absentee
ballots are still being counted.
The state is unlikely to officially certify the results, which
show Mr. Lamb eking out a
win by a few hundred votes,
until next week.
Democrats were emboldened
by their party’s show of
strength in a district President
Donald Trump won in 2016 by
20 percentage points. The seat
became vacant when GOP Rep.
Tim Murphy resigned in October after it was revealed he had
asked a woman with whom he’d
had an affair to consider terminating a pregnancy.
The results provided fresh
momentum to scores of Democratic House candidates looking
to oust Republicans from areas
Mr. Trump won in 2016. There
are 97 GOP-held House districts
in which Mr. Trump’s victory
margin was closer than it was
in the Pennsylvania district.
Andrew Janz, a Democrat
running against GOP Rep. Devin
Nunes in a heavily Republican
California district, said he was
D AV I DY UR M A N .CO M
Shifting Ground
8 8 8 - DY UR M A N
In elections for Senate and House vacancies, all but two Republicans underperformed President Donald
Trump’s 2016 margins. While the GOP retained most of those seats, the narrower-than-expected margins in
deep red areas could signal trouble for Republicans in more competitive congressional districts in November.
Margin of victory in U.S. House and Senate contests since 2016
Partisan
In percentage points; races listed in chronological order
lean*
special election result
Kansas House 4th
50 GOPheld
seats R+5
or less
R+15
Montana House at-large
2016
presidential
race
Georgia House 6th
R+11
R+9
Utah House 3rd
R+25
Alabama Senate
R+14
Pennsylvania
House 18th
R+11
10
Republican win
20
15
R+8
South Carolina House 5th
10
Democratic win
Partisan lean of GOP districts
Number of U.S. House seats
10
5
0
30
D+5
R+5 10 15 20 25 30
*How many points more Republican or Democratic a district/state is relative to the nation, based on the two-party vote
in the two most recent presidential elections. Districts with a partisan lean of 5 points or less are considered competitive.
Sources: Daily Kos Elections (2016); the states (2017); Cook Political Report (House seats)
inspired by Mr. Lamb’s showing
in an even more conservative
district than his own. “I can’t
thank Conor enough for having
the tenacity to take on” such a
tough district, Mr. Janz said.
House Speaker Paul Ryan of
Wisconsin told fellow House
Republicans in a closed-door
meeting Wednesday that it was
a “wake-up call” for the GOP.
Speaking to reporters after
the meeting, Mr. Ryan predicted
most Democratic candidates in
the midterms would run races
to the left of Mr. Lamb.
The Democrat has said he is
personally opposed to abortion—but supports the legal
right to abortion—and said he
wouldn’t support Rep. Nancy
Pelosi of California as the
House Democratic leader.
“This is something you are
Randy Yeip/THE WALL STREET JOURNAL.
not going to see repeated,” Mr.
Ryan said. “They were able to
pick a candidate who ran as a
conservative, who ran against
the minority leader.”
Mr. Lamb has bucked the liberal wing of his party by opposing a Medicare-for-all healthcare system, but he also ran
against the new GOP tax law,
describing it as a “giveaway” to
the wealthy and large corporations at the expense of the middle and lower classes. Mr. Lamb
also vowed to be a champion
for organized labor, and he garnered the support of unions
whose membership included
steelworkers and coal miners.
Tuesday’s special election
followed four in 2017 in which
Democrats came close but
failed to win Trump-friendly
House seats. The result Tues-
day suggests a shifting landscape. Mr. Lamb carried 172
precincts Mr. Trump won in
2016, while Mr. Saccone didn’t
win any precincts Democrat Hillary Clinton carried, according
to Miles Coleman of the elections website Decision Desk HQ.
Mr. Trump didn’t comment
on the results, but White House
spokesman Raj Shah said the
president, who campaigned
twice for Mr. Saccone, “turned
what was a deficit for the Republican candidate to what is
essentially a tie.”
Mr. Shah added that “the
Democrat in the race really embraced the president’s policies
and his vision” rather than his
party’s hierarchy. The only major issue on which Mr. Lamb
lined up with the president was
his imposition of steel tariffs.
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Senate Passes Bill Easing Banking Rules
WASHINGTON—Congress
moved a step closer Wednesday to relaxing the wave of
crisis-era restrictions placed
on the banking industry, with
Senate approval of a bipartisan plan to ease rules for
small and midsize banks.
The bill, which has a good
chance of becoming law, would
be the most significant revamp of financial rules since
President Donald Trump took
office and his administration
set out broad goals to reduce
business regulations.
Approved on a 67-31 vote,
the legislation seeks to cut red
tape and relieve lenders from
some of the most onerous rules
put in place after the financial
crisis, including restrictions
meant to limit the damage firms
could cause to the economy.
Seventeen centrists from the
Democratic caucus supported
the bill, bucking the party’s liberals who have fought changes
to the 2010 Dodd-Frank financial law, a sweeping initiative
meant to prevent another financial meltdown.
Supporters said the bill will
spur more lending and boost the
U.S. economy. “This bill has received widespread support for
good reason: the cycle of lending and job creation has been
stifled by onerous regulation,”
said Sen. Mike Crapo (R., Idaho),
the bill’s main author and chairman of the banking committee,
on the floor ahead of the vote.
Opponents said it would
JACQUELYN MARTIN/ASSOCIATED PRESS
BY ANDREW ACKERMAN
Senate Majority Leader Mitch McConnell was one of 67 senators
who approved a bill to relax restrictions on the banking industry.
bring back unnecessary risks to
the nation’s financial system
and harm consumers. They
noted the bill passed on the 10year anniversary of the collapse
of Bear Stearns Cos, a key development in the 2008 crisis.
The legislation now moves
to the House, where top Republicans said they want to
add provisions to the bill.
Adding to it could upset the
deal between Mr. Crapo and a
group of moderate Democrats,
possibly delaying final passage
for weeks or months, or derailing the legislation altogether, Senate aides said.
In a statement after the vote,
the White House said Mr.
Trump, a Republican, would
sign the Senate bill into law
without additional changes,
though he “looks forward to discussing any further revisions the
House is interested in making.”
A spokeswoman for House
Speaker Paul Ryan (R., Wis.)
said Mr. Ryan is working with
Rep. Jeb Hensarling (R.,
Texas), chairman of the Financial Services Committee, and
the GOP conference “to determine next steps.”
Wednesday’s bill marks one
of the Senate’s few bipartisan
accomplishments in recent
memory.
Last year, the biggest legislative battles over health care
and taxes both relied on a procedural shortcut tied to the
budget process. That allowed
Republicans to pass a tax
overhaul with a simple majority in the Senate, although
they fell short of that on
health care. Most legislation
needs 60 votes to clear procedural hurdles in the Senate.
A core piece of the Senate
bill could cut to 12 from 38 the
number of banks subject to
heightened Federal Reserve
oversight by raising a key regulatory threshold to $250 billion in assets from the current
$50 billion. The Fed has already eased stress tests for
midsize banks, but Dodd-Frank
limits the Fed’s reach because
it spells out that all banks
above $50 billion in assets
must face stricter rules. By effectively raising that threshold
to $250 billion, the new legislation would give regulators
more space to lighten the load.
The bill would also give the
Fed some discretion to keep a
closer eye on banks in the
$100 billion to $250 billion
range, depending on their perceived risk levels.
Another provision—a flashpoint in the debate over the
bill—would exclude banks that
originate fewer than 500
mortgages annually from having to report certain racial and
income data on their mortgages, unless they perform
poorly on tests of lending discrimination.
Critics charge the provision
could make it tougher to police racial discrimination in
lending, though supporters
have denied the charge. They
point to a Fed Bank of Kansas
City analysis that found about
3.5% of total reportable data
would be lost, while about 75%
of banks would receive relief
under the provision.
Heard: Big winners in bill to
help small banks.................... B12
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THE WALL STREET JOURNAL.
X
U.S. NEWS
Kudlow Gets
Economic
Adviser Post
20 years by interviewing him
on those shows.
Mr. Kudlow’s appointment
suggests Mr. Trump will continue to hear conflicting
voices in the White House.
The president has said he
likes fielding competing views.
In the tariff debate, Mr. Trump
sided with trade skeptics who
sought to crack down on cheap
imports of steel and aluminum.
“The president wants to
hear me, even if we disagree.
He told me that several
times,” Mr. Kudlow said
Wednesday.
Beyond trade, Mr. Kudlow, a
former budget aide to President Ronald Reagan, has urged
the Trump administration to
pay more attention to growing
budget deficits.
At 28 years old, Mr. Kudlow
became chief economist at
Paine Webber, a prominent
brokerage firm, and later took
the same position at Bear
Stearns, even though he lacked
an economics degree.
After a turn through government—he served as the top
economist to Reagan budget
director David Stockman—he
returned to Bear Stearns.
In 1994, he resigned and
subsequently acknowledged a
drug and alcohol addiction. It
isn’t clear whether that episode could complicate efforts
to obtain security clearances.
For the past 17 years, he
has appeared as a commentator and host on various CNBC
and radio programs, and he
has toyed with running for the
Senate as a Republican.
BY NICK TIMIRAOS
Lawrence Kudlow, a conservative economic commentator
whose career included jobs in
the White House, Wall Street,
radio and business television,
will become one of President
Donald Trump’s top economic
advisers as director of the National Economic Council.
Mr. Kudlow said he was offered the job after a series of
recent phone conversations
with the president in which
the two discussed differences
of opinion about trade, among
other things.
Mr. Kudlow, who served as
an informal Trump campaign
adviser, has spoken out against
the tariffs on steel and aluminum that Mr. Trump announced last week. A White
House dispute over those tariffs played a role in the decision
to step down by Gary Cohn, the
previous NEC director.
The White House confirmed
the appointment Wednesday.
Despite differences on trade,
Mr. Kudlow was a strong supporter of tax cuts and deregulation championed by Mr. Trump.
The two also have a kinship in
television; Mr. Kudlow is a
longtime personality on CNBC
and has his own radio program.
He developed a relationship
with Mr. Trump over the past
u Age: 70.
u Antiwar movement leader
during the Vietnam War.
u Bachelor’s degree, history,
University of Rochester, 1969.
u Assistant to Paul Volcker,
president, New York Fed.
u Chief economist, Bear
Stearns.
u Budget aide to President
Ronald Reagan.
u CNBC commentator, host.
u Avid tennis player.
As Seen on TV, a Trump Fan, Critic
BY DAVID HARRISON
President Donald Trump’s
pick for National Economic
Council director has an extensive record of policy views.
Lawrence Kudlow has been
a vocal advocate of “supplyside” economics, the idea that
cutting business taxes and regulation will lead to greater investment, hiring and economic
growth.
The prominent Republican
economic analyst and television commentator supports
free trade and a strong dollar,
positions at odds with those of
his new boss. He also favors
tax cuts and low interest rates,
putting him in sync with the
president.
Here is a brief summary of
his comments on some issues:
TRADE
Mr. Kudlow has criticized
Mr. Trump’s decision to impose tariffs on imported steel
and aluminum. In a recent National Review article written
with economist Arthur Laffer
and policy analyst Stephen
Moore, Mr. Kudlow said tariffs
were equivalent to a tax on
American consumers who will
have to pay more for goods
that use steel and aluminum.
Mr. Kudlow has privately
said, however, he could support tariffs with some modifications if they are used as a
negotiating tool to achieve
better trade relationships, according to a person who has
spoken with him in recent
days. Unlike the president, Mr.
Kudlow isn’t overly concerned
about the U.S. trade deficit.
DOLLAR
Mr. Kudlow says a strong
U.S. currency keeps a lid on
inflation and interest rates
and gives American firms and
households more purchasing
power, all of which fuels faster
economic growth.
Mr. Trump has expressed
support for a weaker dollar as
a way to help American exporters by making their products cheaper in global markets.
TAXES
Mr. Kudlow has said the
tax cuts enacted last year
would boost annual economic
growth to 3% or 4% because
they make it cheaper for
firms to borrow and increase
returns on investment.
Those higher growth rates
will lead to increased government revenue, more than offsetting the amount forgone
because of lower tax rates, he
said.
The congressional Joint
Committee on Taxation has
found more modest growth
effects and estimated the tax
cuts would cost roughly $1
trillion after taking additional
economic growth into account.
INTEREST RATES
In 2015, he supported thenFederal Reserve Chairwoman
Janet Yellen’s policy of taking
a cautious and slow approach
to raising rates from near
zero. At the time, many Republicans on Capitol Hill were
calling for higher borrowing
costs, saying low rates could
trigger excessive inflation.
Mr. Kudlow says the Trump
tax cuts, by increasing investment, will allow the economy
to grow faster without putting upward pressure on inflation. For that reason, he dismisses concerns that the
economy risks overheating.
FORECASTING
Mr. Kudlow’s belief in the
benefits of tax cuts has fueled
optimism, on occasion ahead
of a storm. He said in late
2007 that the Bush administration’s tax cuts would guarantee a continued economic
expansion, despite wobbly
stock markets and worries
about a housing slump.
“There’s no recession coming,” he wrote in December
2007. “The Bush boom is alive
and well. It’s finishing up its
sixth consecutive year with
more to come. Yes, it’s still
the greatest story never told.”
That month, the economy
entered the worst recession
since the Great Depression.
White House Braces for More Staff Changes Rand Paul
To Oppose
State, CIA
Nominees
BY REBECCA BALLHAUS
David Shulkin
Mr. Trump has been considering replacing Veterans Affairs
Secretary David Shulkin since
an inspector general’s report
released last month found the
secretary had misspent taxpayer money during an official
trip to Europe last year. Among
the candidates Mr. Trump is
considering: Energy Secretary
Rick Perry, with whom the
president lunched on Monday,
according to an administration
official.
H.R. McMaster
National security adviser Lt.
Gen. H.R. McMaster is working
with strained alliances both inside and outside the White
House and faces persistent
speculation that he will be
pushed out as soon as the Pentagon finds a suitable new job
for him—or the White House
settles on someone to take his
place. Gen. McMaster has little
chemistry with the president,
and has often frustrated Mr.
Trump with lengthy policy dissertations in the Oval Office,
BY KRISTINA PETERSON
MANDEL NGAN/AGENCE FRANCE-PRESSE/GETTY IMAGES
WASHINGTON—The White
House is preparing for more
changes in the administration’s
senior ranks following this
week’s dismissal of Secretary of
State Rex Tillerson and last
week’s resignation of top economic adviser Gary Cohn.
President Donald Trump has
hinted at a further shuffle. “I’m
really at a point where we’re
getting very close to having the
cabinet and other things that I
want,” said Mr. Trump on Tuesday, hours after announcing via
Twitter that he was ousting Mr.
Tillerson.
Last
week,
on
the
day Mr. Cohn resigned, Mr.
Trump wrote on Twitter that
he was “always seeking perfection” in staffing the White
House. Still, he wrote: “There is
no Chaos, only great Energy!”
In the past, the president
has privately discussed ousting
aides, only to reconsider, and at
times he has publicly criticized
cabinet members but taken no
further action.
But White House officials
said they are expecting more
changes, which can come
quickly once the Republican
president decides to show a
colleague the exit.
Here is a look at members of
Mr. Trump’s administration
whose futures appear uncertain, based on Wall Street Journal reporting.
President Donald Trump addressing a cabinet meeting earlier this month. A number of administration officials may be on their way out.
Ex-FBI Deputy Chief
McCabe Faces Firing
Attorney General Jeff Sessions is considering a recommendation to fire former Deputy FBI
Director Andrew McCabe and
could order his ouster this week,
shortly before Mr. McCabe’s expected retirement, according to a
person familiar with the matter.
Mr. McCabe allegedly wasn’t
forthcoming with investigators
probing the disclosure of information to a Wall Street Journal reporter for an October 2016 article
about an inquiry into the Clinton
Foundation, said the person.
Mr. McCabe left his post in
according to people familiar
with the conversations.
Jeff Sessions
Few cabinet members have
faced as much public battering
as Attorney General Jeff Sessions, a frequent target of Mr.
Trump’s criticism since he recused himself last spring from
the Justice Department’s probe
into alleged Russian interference in the 2016 U.S. election.
In his most recent public insult,
the president called Mr. Sessions “disgraceful” last month
January after he was told to step
aside, but had been expected to
take vacation time until he was
eligible to retire this month.
A spokeswoman for Mr. Sessions said that the Justice Department “follows a prescribed
process by which an employee
for referring a probe of the Justice Department’s handling of
secret surveillance warrants to
the department’s inspector general—the usual venue for such
allegations—rather than to another office. Mr. Sessions’ response that he had acted with
“integrity and honor” only infuriated the president further, according to people close to the
White House.
John Kelly
Chief of staff John Kelly,
who joined the White House
may be terminated,” and said she
had “no personnel announcements at this time.”
The inspector general concluded that Mr. McCabe participated in the release of the information and wasn’t forthcoming
during its review. Mr. McCabe
couldn’t be reached to comment.
The review triggered an FBI inquiry into Mr. McCabe’s alleged
conduct. That process resulted in
the recommendation that he be
fired, the person said.
Mr. McCabe has told friends
he didn’t intentionally mislead investigators and was never dishonest, according to another person familiar with the matter.
—Del Quentin Wilber
and Aruna Viswanatha
last summer, has faced scrutiny
from the president in recent
weeks over his handling of domestic-abuse
allegations
against Rob Porter, who resigned as staff secretary last
month. Mr. Trump and other
White House officials had harsh
words for Mr. Kelly, who initially vouched for Mr. Porter’s
integrity and privately urged
him to fight the allegations and
remain in the job, according to
White House officials. Mr. Kelly
later reversed himself.
Mr. Trump has already found
workarounds to some of Mr.
Kelly’s measures to limit access
to the president, such as relying on first lady Melania Trump
to field calls from friends. Some
of the president’s friends said
last month that Mr. Trump has
started to ask them about Mr.
Kelly’s performance, and two
people said he has sought opinions on potential replacements.
Jared Kushner
and Ivanka Trump
The president has held conflicting views about what to do
with Jared Kushner, his son-inlaw, and Ivanka Trump, his elder daughter, both of whom
serve as senior advisers in the
White House. Mr. Kushner’s security clearance was downgraded to secret from top secret late last month, following a
push by Mr. Kelly to tighten
control of classified information inside the administration.
And Mr. Kushner has figured
prominently in the special
counsel’s Russia probe, which is
focusing on a number of episodes during the campaign that
involved him. He has denied
any wrongdoing.
Inside the West Wing, the
president has repeatedly wondered whether the couple
would be better off returning to
their private-sector lives in
New York.
President Donald Trump’s
picks to run the Central intelligence Agency and the State
Department will likely need
votes from Democrats to get
confirmed by the closely divided Senate, after a Republican lawmaker said he would
oppose their nominations.
Sen. Rand Paul (R., Ky.) on
Wednesday said he would oppose the nomination of Gina
Haspel to lead the CIA, citing
her involvement with the
harsh interrogation program
used in the wake of the Sept.
11, 2001, attacks. He also said
he would oppose the nomination of Mike Pompeo to be secretary of state, citing his apparent stance on foreign wars.
President Donald Trump on
Tuesday fired Rex Tillerson as
secretary of state and named
Mr. Pompeo, currently the CIA
director, to succeed him. Ms.
Haspel, the agency’s deputy director, would be the first woman
to lead the CIA if confirmed.
Lawmakers expect Mr.
Pompeo to face few hurdles to
confirmation. He was confirmed
to his current CIA post in January 2017 in a 66-32 vote three
days after Mr. Trump’s inauguration. But Ms. Haspel could
face a tougher time, and her
nomination has already drawn
concern from lawmakers.
Nominees need a majority
vote to clear the Senate, where
the GOP has a 51-49 advantage.
Vice President Mike Pence
would break any ties. GOP Sen.
John McCain has been battling
brain cancer and is expected to
stay home in Arizona.
“This is a very closely divided body, and if even one or
two Republicans choose to oppose a nominee, then it opens
the door for us to defeat that
nominee,” said Sen. Chris
Coons (D., Del.), who said he is
starting to review Ms. Haspel’s
record.
Mr. Paul said Wednesday he
worried Mr. Pompeo hadn’t
drawn the same lessons from
the Iraq war as he had: that “regime change has unintended
consequences” that could be repeated in Iran. Mr. Pompeo has
been a critic of the 2015 nuclear
agreement that the U.S. and five
other nations struck with Iran.
BRENDAN MCDERMID/REUTERS
CNBC commentator,
who had informal role
in president’s 2016
race, to succeed Cohn
At a Glance
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | A5
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.
A6 | Thursday, March 15, 2018
THE WALL STREET JOURNAL.
* ***
U.S. NEWS
BY SHIBANI MAHTANI
CHICAGO—Konrad
Poplawski, a 22-year-old Navy hospital corpsman, is about to be
deployed as a battlefield medic
with the 2nd Marine Division,
which has served in deadly
battlegrounds in Iraq and Afghanistan.
But first, he is making a pit
stop at Cook County’s Stroger
Hospital, which the Navy says is
among few places in the U.S.
that provide experience treating the types of wounds he will
inevitably see on the battlefield.
For so long “the first time a
corpsman got any trauma experience was when they were deployed, and some would just
freeze up,” said Capt. Paul
Roach, a U.S. Navy surgeon at
the Lovell Federal Health Care
Center north of Chicago. “We
don’t want that to happen anymore,” said Capt. Roach, who
heads the program in the Great
Lakes region.
The Navy is working to for-
malize a pilot program that has
been tested here for three
years, rotating newly enlisted
hospital corpsmen—the combat
medics for the Navy and Marines—and those needing a refresher while they are back
home, for six to eight weeks
through Stroger Hospital’s
trauma center. The 14-bed unit
treats over 6,000 trauma patients yearly, many of them
with penetrating, life-threatening wounds akin to those on the
battlefield.
Though Chicago is experiencing a sustained drop in murders since a dramatic spike in
2016, it remains a city where a
high number of gunshot victims
cycle through the trauma center night after night.
About 30% of patients at
Stroger Hospital, on Chicago’s
near West Side, are admitted to
the trauma ward with wounds
from firearms, compared with a
national average of 4.2% for
level 1 trauma centers—hospitals certified to have the re-
ROB HART FOR THE WALL STREET JOURNAL
First Stop for New Navy Medics: Chicago
Navy hospital corpsman Konrad Poplawski, center, and Andrew
Swain, right, speak with Evoria Williams at Stroger Hospital.
sources to handle multiple victims with penetrating and other
serious wounds—according to
the National Trauma Data Bank.
“The experience here can’t
be replicated elsewhere, unless you have a major land invasion,” said Dr. Faran
Bokhari, who chairs the
trauma and burn surgery unit
at the hospital.
In many front-line Marine
units, immediate medical care
for gunshots, explosions or
shrapnel comes from these
corpsmen who mostly are
young, new to the service and
new to seeing up close the
wounds they train to treat. The
Navy medics, known as hospital
corpsmen, typically receive 14
weeks of training in first aid
and patient care in Fort Sam
Houston in Texas after initial
boot camp, and then have the
option for additional training.
The program at Stroger Hospital is part of a new push from
the Department of Defense to
prioritize civilian and military
partnerships, specifically budgeted for in last year’s National
Defense Authorization Act.
Navy corpsmen started embedding at Stroger Hospital as part
of a pilot program in 2014, but
the program will be expanded
and designated an official training rotation this spring.
“Corpsmen are not routinely
exposed to trauma or critically
injured patients during their
first assignments,” said Defense
Department spokeswoman Maj.
Carla Gleason. This “realistic,
hands-on trauma training will
allow them to hone their skills
and increase their readiness.”
In recent days, the group of
corpsmen have learned skills
including how to scrub in before entering an operating the-
ater and how to operate a range
of machinery, including suction
machines for patients who are
losing blood. After just two
days of training, they are fully
immersed in the trauma unit’s
team of doctors and surgeons,
expected to help with procedures during the unit’s busiest
shift from 3 p.m. to 3 a.m.
Navy corpsmen often operate independently in combat
zones, and the immersion helps
them learn protocol and procedures in a large hospital so they
can later replicate that.
“A lot of it is, here’s your
training, you learn, it gets
drilled in into your head—then
it’s just go,” said Andrew Swain,
a 26-year-old corpsman who
has served as a medic in Iraq.
During that deployment, in his
first “mass-casualty incident,”
he and just a handful of other
medics had to treat about eight
injured at the same time, all
with traumatic injuries.
—Ben Kesling
contributed to this article.
HOLMES
THE WALL STREET JOURNAL, OCTOBER 15, 2015
THE WALL STREET JOURNAL, JUNE 13, 2016
THE WALL STREET JOURNAL, OCTOBER 21, 2016
THE WALL STREET JOURNAL, NOVEMBER 17, 2016
JEFF CHIU/ASSOCIATED PRESS
Continued from Page One
pin of the company’s strategy
handled just a small fraction
of the tests sold to consumers.
Some employees also were
leery about the machine’s accuracy, the Journal reported.
Theranos was valued at more
than $9 billion at the time and
Ms. Holmes’s majority stake at
more than half that.
Before the Journal’s articles, Ms. Holmes’s bold talk
and black turtlenecks drew
comparisons to Apple Inc. cofounder Steve Jobs. She was
featured on the covers of Fortune and Forbes magazines,
and she was a fixture at industry conferences.
She started Theranos in
2003 after dropping out of
Stanford University as a 19year-old sophomore. Over the
next dozen years, she successfully raised money from
wealthy investors such as venture capitalist Tim Draper and
Rupert Murdoch, who is the
executive chairman of News
Corp, which publishes the
Journal. Theranos’s board included former U.S. Secretary
of State George Shultz and
other high-profile directors.
Messrs. Murdoch and Shultz
declined to comment.
Theranos’s rise and fall became a symbol of the excesses
of the current technology
boom, and the company exacted a painful financial and
personal toll. The widow of a
British
biochemist
who
worked at Theranos and committed suicide in 2013 told the
Journal her late husband had
become frustrated at the company’s lack of progress.
Tyler Shultz, a grandson of
the former secretary of state
and the first employee to blow
the whistle to a state regulator
about what he saw as troubling practices, became estranged from his grandfather.
An assistant to the elder
Mr. Shultz has said that he “is
deeply sorry that Tyler’s experience at Theranos was so unsatisfactory for Tyler.”
Many Theranos investors
have lost the entire value of
their investment. The losses
for Mr. Murdoch, once the
company’s largest investor, total more than $100 million,
people familiar with the matter said.
The SEC said in its civil
lawsuit Wednesday that Theranos was “on the verge of
bankruptcy” in late 2017. The
company has been kept afloat
by a loan from a private-equity firm that is secured by
Theranos’s patents.
At the height of her fame,
Ms. Holmes claimed she had
developed revolutionary technology that would bring about
earlier disease detection by
making blood testing more
user-friendly. She described a
world in which no one would
have to say goodbye to a loved
one too soon.
In response to the Journal’s
articles, Ms. Holmes sought to
discredit its reporting, and
Theranos threatened the
newspaper with litigation. The
company later shut down several of its laboratories and
voided nearly a million test results, leaving a trail of agonized patients who had been
drawn to Theranos by its
claims of convenience, low
cost and reliability.
Walgreens, a unit of Walgreens Boots Alliance Inc., terminated a three-year partner-
THE WALL STREET JOURNAL, NOVEMBER 29, 2016
Read the articles by The Wall Street Journal that led to the investigation of Theranos and its founder, Elizabeth Holmes, at WSJ.com.
Sky High
Number Gap
Enthusiastic investors boosted Theranos’s value to more than $9 billion.
The SEC alleged that potential
investors got these projections
in October 2014...
Theranos valuation
$8 billion
Money raised from investors
February 2014
$600 million
$9 billion
6
400
4
Revenue
sources
...and Elizabeth Holmes allegedly
showed this 2014 revenue total
in 2015...
Pharmaceutical
services
Lab services for
Hospitals
Physicians’
offices
$40 million
$46
$9
$108 million
Source: Securities and Exchange Commission
200
December 2004
2 $30 million
0
2003 ’05
0
’10
’15
Source: Company filings
ship with the startup and shut
down the Theranos lab-testing
centers it introduced in 40
drugstores in Arizona and California. The two companies
had been about to expand the
partnership to Walgreens’s
other U.S. stores.
Theranos later settled lawsuits filed by Walgreens and a
hedge-fund investor, and the
blood-testing company agreed
to reimburse patients in Arizona as part of a settlement
with the state’s attorney general. In its civil suit, the SEC
alleged Ms. Holmes and Theranos “never told” Walgreens
about the blood-testing firm’s
technological challenges.
The SEC filed separate civil
fraud charges against Theranos’s former president and
chief
operating
officer,
Ramesh “Sunny” Balwani. Ms.
Holmes and Mr. Balwani
jointly ran the company for
seven years before he retired
in May 2016, even as the two
executives were in a romantic
relationship, according to people familiar with the matter.
It isn’t clear why the SEC
didn’t reach a settlement with
Mr. Balwani. His lawyer, Jeffrey B. Coopersmith, said in a
statement: “Sunny Balwani accurately represented Theranos
Dec. Feb. Oct. June Feb.
2004 ’06 ’06 ’10 ’14
THE WALL STREET JOURNAL.
to investors to the best of his
ability. He believed in the potential and mission of the
company and its technology to
promote transparency and
benefit people by empowering
them with access to their own
health care information at a
low cost.”
Theranos is still facing a
criminal investigation led by
the U.S. attorney’s office in
San Francisco, people familiar
with the investigation said.
They said investigators in that
probe have interviewed former
Theranos employees and doctors in Arizona who ordered
blood tests from the company.
“The Theranos story is an
important lesson for Silicon
Valley,” said Jina Choi, director of the SEC’s regional office
in San Francisco, in a statement Wednesday. “Innovators
who seek to revolutionize and
disrupt an industry must tell
investors the truth about what
their technology can do today,
not just what they hope it
might do someday.”
The SEC accused Ms.
Holmes and Mr. Balwani of an
elaborate, yearslong fraud in
which they exaggerated or
made false statements about
the company’s technology, business and financial performance.
While telling investors it
had developed a portable
blood analyzer that could
conduct the full range of laboratory tests from just a few
drops of blood pricked from a
finger, Theranos was actually
conducting the vast majority
of the tests it offered to consumers in Walgreens stores
on commercial analyzers
manufactured by other companies, the SEC alleged in its
lawsuits against Ms. Holmes,
Mr. Balwani and Theranos.
Ms. Holmes and Mr. Balwani allegedly claimed falsely
that Theranos’s portable
blood analyzers were deployed by the Defense Department in the battlefield in Afghanistan and on medevac
helicopters.
The two Theranos executives also allegedly told investors that the company would
generate revenue of more
than $100 million in 2014, according to the SEC. In fact,
Theranos had barely $100,000
of revenue that year, securities regulators alleged.
Many of the SEC allegations Wednesday tracked
closely with the Journal’s previous reporting. While Theranos offered more than 240
tests, ranging from cholesterol to cancer, former employees had told the Journal
that its proprietary device,
code-named Edison after the
prolific inventor, could handle
just one type of blood test
known as immunoassays. A
newer device called miniLab
...but the
company's
actual revenue
was far lower.
$100,000
THE WALL STREET JOURNAL.
could do more than one class
of test but was a malfunctioning prototype, according to
the former employees.
When Theranos launched
its finger-prick blood tests in
Walgreens stores in September 2013, it relied on commercial devices made by thirdparty manufacturers to make
up for the Edison’s limited capabilities, according to the
former Theranos employees.
The vast majority of tests offered to consumers were run
on the commercial analyzers,
according to the former employees and the SEC’s suits.
The few blood tests that
were run on the Edison were
considered unreliable by employees in Theranos’s main
lab, the former employees
said.
While Ms. Holmes was the
public face of Theranos, Mr.
Balwani ran the company day
to day and enforced a culture
of secrecy, according to former Theranos employees.
Tyler Shultz, the former
secretary of state’s grandson,
was one of several former
employees who were sources
for the Journal article in October 2015. He said Theranos
lawyers pressured him to retract statements he made before the article was published.
He said he refused to do
so, even after being approached at the elder Mr.
Shultz’s house near the Stanford campus by two lawyers
from Boies, Schiller & Flexner,
a law firm representing Ther-
anos at the time. Mr. Shultz
and his parents told the Journal they spent more than
$400,000 on legal fees.
Meanwhile, outside counsel
David Boies, one of the country’s best-known litigators
since the late 1990s, twice
came to the Journal’s offices
in Midtown Manhattan to try
to persuade the paper not to
publish the October 2015 article. Mr. Boies no longer does
legal work for Theranos.
Many lab experts and doctors say the greatest damage
caused by Theranos’s actions
was to the public health.
One of the tests Theranos
voided measured coagulation
and was relied on by doctors
to adjust the dosage of blood
thinners prescribed to patients at risk of blood clots
and strokes. Following an inspection of Theranos’s main
lab in late 2015, the Centers
for Medicare and Medicaid
Services said Theranos’s mishandling of that and other
tests had put patients in “immediate jeopardy.” Theranos
stopped doing any tests in October 2016.
Ten patients have since
filed lawsuits against the
company alleging consumer
fraud and medical battery.
The suits have been consolidated in federal court in Arizona. Theranos has said it
would defend itself against
the allegations in those lawsuits.
—Christopher Weaver
contributed to this article.
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | A7
* * * *
U.S. NEWS
A Wave of Walkouts
PATRICK T. FALLON FOR THE WALL STREET JOURNAL
More than 3,000 student walkouts were planned across the U.S. to
press elected officials to take action on school gun violence, one
month after the Parkland shooting left 17 dead.
Schools
Grapple
With New
Threats
BY SCOTT CALVERT
Elementary pupils returned to PS1 Pluralistic School after a moment of silence in a nearby park in
Santa Monica, Calif., on Wednesday. Students across the U.S. walked out of classes as a gesture.
Note: Map shows protests planned for March 14 that were registered on womensmarch.com.
Some protests may have been registered by students. Some protests may not have registered
and aren't represented on the map.
Source: Womensmarch.com
THE WALL STREET JOURNAL.
Students Protest Gun Violence
BY ARIAN CAMPO-FLORES
laws, but we don’t want to be
left behind.”
More than 3,000 registered
demonstrations took place in
all 50 states, according to organizers with Women’s March
Youth Empower, which helped
coordinate the “#Enough”
school walkouts. It put the
initial tally at nearly 1 million
and said it was still counting.
About 56 million students attend pre-K through 12th
grade in public and private
schools, according to federal
data.
In the Atlanta Public
Schools, about 16,000 students—mostly middle- and
high-school students—participated in walkouts, officials
said. The school system has
about 52,000 students.
In Los Angeles, student
leaders urged 1,000 students
gathered at Hamilton High
School not to let the issue
fade after the moment had
passed. “I’m begging you—
call your representatives,”
Miriam Schweiger, 17, a senior, said on a microphone.
At Parkland’s Stoneman
Douglas High School, whose
students have taken to traditional and social media to
help turn their own tragedy
into a national campaign for
tougher gun laws, students
filed onto the football field
At 10 a.m., 1,000 students
walked out of Stuyvesant
High School in New York City.
An hour later, 2,800 filed out
of Curie Metropolitan High
School in Chicago. An hour
after that, 1,000 went to the
Capitol in Boise, Idaho. And
an hour after that, 1,000
walked out of Hamilton High
School in Los Angeles, with
signs that read “Am I next?”
In a wave across the country on Wednesday, students
voted with their feet to protest government inaction on
gun control. Nearly 1 million
students took part in the protests, which included kindergartners through high-school
seniors. In New York, the nation’s largest school district,
100,000 students walked out.
The 17-minute walkouts
came a month after a gunman
killed 17 at Marjory Stoneman
Douglas High School in Parkland, Fla. In that same span,
there have been 10 school
shootings in the U.S.
Far from big cities, in
states with high levels of gunownership, students protested. Anna Strong Garcia, a
17-year-old senior at Billings
Senior High School, said, “We
don’t expect Montana to be
the leader in gun-control
Some Districts
Punish Protesters
Some students who walked
out of school Wednesday faced
unexcused absences or more
serious penalties, as school districts in a number of states
cracked down on demonstrations aimed at pressuring politicians to toughen gun laws.
Cobb County School District
in Georgia, which has nearly
113,000 students, said on
Wednesday that those who
participate in disruptive demonstrations may be subject to
punishment in accordance with
the student code of conduct.
This could range from administrative meetings to a five-day
suspension, depending on the
severity of the offense.
Kevin Ciak, school board
president in Sayreville, N.J., said
about two dozen of the high
school’s roughly 1,800 students
protested, with about a dozen
going to the auditorium and a
dozen leaving the building. He
said those who went outside
despite warnings of penalties
would get suspensions.
Mr. Ciak said the district
sought to avoid interruptions
to instruction, and had to treat
all viewpoints equally. “Schools
don’t have the ability to pick
political issues,” said Mr. Ciak.
Nancy Diaz, the mother of a
Sayreville sixth-grader who had
wanted to walk out, said he
wouldn’t due to the suspension
threat. “My son is so upset,
and his friends are so upset,”
she said Tuesday.
—Melissa Korn
and Leslie Brody
for a 17-minute protest. Principal Ty Thompson addressed
them: “We are going to make
change, and it’s already starting.”
Outside, Allison Macleod,
whose son Jack is a junior,
carried a sign reading, “Our
Kids Will Not Be Ignored.”
She wrote it on the back of an
advertisement for a gun show
that she said she pulled out
of the ground after the shooting.
“These kids have been activated,” said Ms. Macleod, 51,
a real-estate agent who plans
to attend the “March for Our
Lives” rally in Washington,
D.C., on March 24.
In the wake of the Parkland
shooting, Stoneman Douglas
students “took that moment
and their frustration and
Use of Tax Break
Draws Scrutiny
TRUMP
BY RICHARD RUBIN
ANDREW HARNIK/ASSOCIATED PRESS
Continued from Page One
his own legal practice.
Mr. Cohen and White House
representatives have denied
any sexual encounter took
place between Mr. Trump and
Ms. Clifford. White House
press secretary Sarah Huckabee Sanders has referred questions about the agreement to
Mr. Cohen.
It isn’t known whether Mr.
Trump participated in the
agreement or was aware of it.
The Federal Election Commission is reviewing complaints
by interest groups alleging the
transaction violated campaignfinance law. Proving any violation would require evidence of
coordination between Messrs.
Cohen and Trump or his campaign, campaign-finance experts say.
Mr. Trump took a leave from
the Trump Organization after
the election and turned over
management to his two eldest
sons and another executive, but
retains a major financial interest in the company. A financialdisclosure form released last
year shows Mr. Trump continues to derive significant income
from the company.
Ms. Martin emailed a statement from the company that
said she facilitated the filing
“in her individual capacity”
until a New York-based lawyer
gained approval to practice in
California. “The company has
had no involvement in the
matter,” the statement said.
Asked for comment, Mr. Cohen referred the Journal to the
Trump Organization’s statement. The White House hasn’t
responded to requests for
comment.
The arbitration filings, revealed by Michael Avenatti,
Ms. Clifford’s attorney, show a
direct connection between Mr.
Trump’s company and the nondisclosure agreement with Ms.
Clifford.
“We are uncovering more
and more evidence that demonstrates that the American
people have not been told the
truth,” Mr. Avenatti said in a
statement. “We will not stop
until we get to the bottom of
this.”
In January, The Wall Street
grievance to speak up about
gun violence and demand
Congress’s action,” said Winter Minisee, 17, a senior in
Riverside, Calif., and one of
the Enough organizers. “We
want to capitalize off that.”
Sustained pressure from
students has been pushing
politicians to action.
President Donald Trump on
Sunday unveiled proposals for
reducing gun violence at
schools that included training
school staffers to carry concealed weapons but not his
earlier calls to raise the age
limit for buying guns.
On Wednesday, the House
passed the Stop School Violence Act, which will authorize $50 million in annual
funding for school security
upgrades. Last week, Florida
Gov. Rick Scott signed measure that added gun restrictions, such as raising the minimum age to buy any type of
firearm to 21.
But many students are calling for more action. Among
the demands listed by the
Enough campaign are a ban
on semiautomatic rifles and
high-capacity magazines, and
the expansion of background
checks to all gun sales.
—Zusha Elinson, Shibani
Mahtani and Ian Lovett
contributed to this article.
When students in Birmingham, Ala., walked out of class
Wednesday morning to honor
the 17 victims in last month’s
school shooting in Florida,
they had one of their own to
mourn.
Courtlin Arrington, a 17year-old high-school senior
and aspiring nurse, was fatally
shot with a pistol on March 7
inside a classroom at Huffman
High School. The alleged
shooter, a fellow student, is
charged with manslaughter.
“Our students are obviously
very shaken,” said Birmingham School Superintendent
Lisa Herring.
After the Feb. 14 rampage
at Marjory Stoneman Douglas
High School in Parkland, Fla.,
students there launched a
high-profile push for tougher
gun laws and safer schools under the banner “never again.”
But school shootings—including on college campuses—
have already happened again,
though not on the same scale.
In the past month, there
have been 10 cases in which a
live round was fired inside or
into a school building, or on or
onto school grounds, that resulted in injury or death, including suicides, according to
Everytown for Gun Safety, a
group that advocates stricter
gun laws.
Meanwhile, police from California to Vermont say they
have thwarted at least seven
potential gun attacks on
schools.
Before Parkland, there were
11 school threats a day on average this school year, according
to Educator’s School Safety
Network, an Ohio-based nonprofit that sells safety-training
programs to schools. In the
seven school days after the
shooting, the daily total
ranged from 64 to 98. The tally
has since dropped but remains
“very elevated,” said cofounder Amy Klinger.
President Donald Trump’s lawyer Michael Cohen brokered a deal with actress Stephanie Clifford.
Journal first reported the existence of the nondisclosure
agreement and the payment to
Ms. Clifford, who had privately
alleged she had a sexual encounter with Mr. Trump after
they met at a celebrity golf
tournament in 2006.
Ms. Martin, 38 years old, is
a vice president and assistant
general counsel at the Trump
Organization based in Los Angeles, according to her
LinkedIn page.
In the arbitration proceedings, Ms. Martin signed a declaration listing her office address as One Trump National
Drive, which is at the Trump
Organization’s Trump National
Golf Club in Rancho Palos
Verdes, Calif.
Ms. Martin, a lawyer for the
Trump Organization since
2010, has defended Mr. Trump
both in court and in the media.
She was a lead attorney for the
Trump Organization in lawsuits
alleging Mr. Trump’s real estate
seminars, Trump University,
had defrauded customers.
The company settled the
lawsuits in November 2016, after Mr. Trump’s victory in the
presidential election, without
admitting wrongdoing.
While she had no formal
role in Mr. Trump’s presidential campaign, Ms. Martin
vouched for his character in
media interviews during the
2016 campaign, after several
women accused him of sexual
harassment and assault, which
he denied.
“Thousands of women have
worked for him, including myself, and he’s treated us with
nothing but respect and appropriately. And he’s always been
someone who none of us
would ever imagine he would
do something like this,” Ms.
Martin said of the accusations
in an October 2016 interview
with CNN.
Mr. Cohen, who was a se-
Ms. Clifford is
seeking to have the
agreement declared
null and void.
nior lawyer at the Trump Organization when he made the
deal with Ms. Clifford in October 2016, said in a Feb. 13
statement to the media that he
“facilitated” the payment using his own funds.
Mr. Cohen said he hadn’t
been reimbursed by the Trump
Organization or by Mr.
Trump’s campaign, but declined to say if he had been reimbursed by Mr. Trump or
anyone else.
The
arbitration
filing
signed by Ms. Martin was
made on behalf of “EC, LLC,”
an acronym for Essential Consultants used in the nondisclosure agreement, and against
“Peggy Peterson,” a pseudonym for Ms. Clifford used in
the agreement in an effort to
conceal her true identity.
Ms. Clifford last week filed
a lawsuit in Los Angeles
County Superior Court seeking to have the agreement declared null and void. Neither
the White House nor Mr. Cohen has responded to the
suit.
Among the arguments in
her complaint is that Mr.
Trump didn’t sign the agreement even though he was
party to it. He was listed as
“David Dennison,” also a pseudonym, her court filings show.
In the “highly confidential”
documents Ms. Martin filed
with the arbitration demand,
she said the nondisclosure
agreement allowed for a restraining order to be issued
against “Peggy Peterson” without advance notice in the
event of a threatened breach
of the contract.
On Feb. 27, an arbitrator issued a temporary restraining
order against Ms. Clifford barring her from violating the
nondisclosure agreement. Mr.
Avenatti challenged the legitimacy of the arbitration.
—Jim Oberman
contributed to this article.
WASHINGTON—More than
15,000 investors have participated in certain tax deals involving charitable contributions of land rights, according
to new IRS data that was
given to lawmakers who are
scrutinizing the practice,
which is estimated to cost the
government more than $1 billion in revenue annually.
The data provide the clearest big-picture look yet at the
opaque world of syndicated
conservation
easements,
transactions giving some investors tax breaks worth more
than the amount they originally invested in the property.
In late 2016, the Internal Revenue Service began requiring
participants and advisers to
alert the agency to the transactions to aid in determining
who should be audited.
The new data, provided to
senators and reviewed by The
Wall Street Journal, come
from the first wave of those
disclosures. The reports show
552 separate transactions covering several years and exceeding previous estimates.
The Brookings Institution has
estimated that the total revenue loss from syndicated easement deals was between $1.3
billion and $2.4 billion in 2016.
“What started as a critical
tool for land preservation has
been systematically exploited
by bad actors peddling tax
shelters to the highest bidder,”
said Sen. Ron Wyden of Oregon, the top Democrat on the
Senate Finance Committee.
“Congress must act swiftly to
protect the integrity of the conservation easement program.”
Under U.S. law, land owners
can donate the development
rights to their property to
land trusts, other charities or
governments. For example, a
farmer with a $5 million piece
of land can place an easement
on the property that restricts
development. By donating the
easement to a charity and getting an appraisal, the farmer
could show that the land’s
value has diminished by $3
million and thus can claim
that amount as a deduction.
That is relatively noncontroversial in Congress.
The syndicates that popped
up in recent years, however,
are more aggressive because
they can let people profit
quickly from tax breaks. They
have led to a rift in the conservation world, with more established land trusts worrying
that more aggressive deals undermine support for conservation easements more broadly.
In a syndicated easement,
the organizer recruits investors who buy a piece of a partnership. The organizer identifies property, buys it, makes
the donation and then parcels
out the deduction. The syndicated deals are popular in the
Southeast, and their backers
say they efficiently promote
conservation by getting tax
deductions to people who have
the income to use them.
The key, critics say, is often
an inflated appraisal and a relatively small network of advisers and charities supporting
the transactions. The disclosures identified 38 appraisers
involved in the 552 deals.
The IRS’s 2016 requirement
forced advisers and taxpayers
to disclose transactions where
the value of the deduction was
at least 2.5 times the investment, roughly the point where
the tax deduction exceeds the
original investment for many
taxpayers.
The average deduction was
4.07 times the investment,
with some exceeding seven
times the investment, according to the IRS data.
Sens. Steve Daines (R.,
Mont.) and Debbie Stabenow
(D., Mich.) introduced a bill
last month that would deny
the tax break when the deduction-to-investment ratio exceeds 2.5. Mr. Wyden backed
that bill on Wednesday and
Reps. Mike Thompson (D., Calif.) and Mike Kelly (R., Pa.)
have a companion House bill.
.
A8 | Thursday, March 15, 2018
THE WALL STREET JOURNAL.
* ***
U.S. NEWS
WASHINGTON—U.S. businesses seeking to avoid tariffs
on imported supplies that incorporate steel and aluminum will
face high hurdles under rules
being developed by the Commerce Department, which is signaling it will grant exclusions
only sparingly and based on national-security concerns.
Commerce Department officials are preparing to release,
either at the end of this week or
early next week, a detailed blueprint for industry groups seeking exclusions, according to
people familiar with the plans.
President Donald Trump last
week announced the tariffs on
global steel and aluminum imports, of 25% and 10%, respectively, to protect domestic metal
producers. The move generated
retaliation threats around the
world and started a competition
for countries and industries
seeking exceptions to the trade
barriers.
U.S. importers would likely
have to pay tariffs on metals
imported this month after they
are implemented, even if they
are applying for an eventual exclusion, according to people familiar with the discussions.
It isn’t clear if the tariffs
would be refunded if a firm is
subsequently granted an exclusion, the people said. More than
a dozen Republican lawmakers
who oversee trade policy wrote
to Commerce Secretary Wilbur
Ross on Wednesday asking for
tariffs to be repaid if companies
get product exclusions in order
to avoid a “chilling effect on
commerce and jobs.”
Commerce officials briefed
congressional aides Tuesday.
Mr. Ross, along with officials
from other agencies, will take
into consideration arguments
focused on national security, the
legal basis for the tariffs under
Section 232 of a 1962 trade law,
according to people familiar
with the process.
Mr. Ross is set to answer
questions about the tariffs at a
public House committee hearing on March 22, a day before
the tariffs are expected to take
effect, according to a congressional aide.
The Commerce rules will allow for a 90-day application
process for exclusions that includes public comment.
U.S. Trade Representative
Robert Lighthizer’s team has
been negotiating with foreign
governments about nationallevel tariff exemptions, also
based largely on national-security concerns.
Companies ranging from
auto-parts producers worried
about rising steel costs to brewers concerned about aluminum
for cans are expected to seek
exclusions.
Commerce officials are sending the message that they don’t
want to exclude many products,
preferring instead that the U.S.
metal industry add production
to supply any needed products,
the people said. A high-quality steel used in tires could in
theory be excluded from the tariffs if administration officials
determine it can’t be produced
in sufficient quantities in the
U.S. and if the material is obtainable in the Japanese market
or that of another U.S. ally.
Backers of the tariffs are
pushing for exclusions to be
temporary or subject to renewal, hoping U.S. industry will
soon be able to supply more
items that are now imported.
Manufacturers and commodities traders are watching because the rules are likely to affect the prices of raw materials
Rules are soon to be released governing exemptions to U.S. tariffs on foreign metals, which are designed to aid domestic producers.
used in manufacturing a range
of products.
Following the passage of tax
legislation, the Trump administration has shifted toward implementing the America First
trade policy the president
promised during the 2016 campaign. The push has generated
complaints from many GOP lawmakers worried about economic
damage or retaliation from
abroad. Congressional Republicans, however, say they don’t
have the votes to block the tariffs and override a likely veto.
The administration sees the
steel and aluminum tariffs as a
way of addressing—somewhat
indirectly—China’s high levels
of metal production and exports, blamed for lowering
prices and threatening the industry around the world.
In recent years, the Commerce Department has set some
individual tariffs blocking many
types of allegedly dumped and
subsidized steel and aluminum
from the U.S., but the administration is hoping the global tariffs—likely to hit some top allies—will lead to more
international pressure on Beijing.
Europe zeroes in on U.S. tech
firms amid rising tensions... B4
Levies Could Unite
Allies Against China
U.S. allies seeking exemptions
from President Donald Trump’s
steel and aluminum tariffs are
showing signs of coalescing
around a common appeal: a
promise to join forces with the
U.S. in addressing a metal glut
emanating from China.
Leading the negotiations
with foreign governments is
U.S. trade representative Robert Lighthizer.
President Donald Trump’s tariffs
People familiar with Mr.
Lighthizer’s discussions with
foreign counterparts say country exclusions and product extries are arguing they shouldn’t emptions. Mr. Trump has
have to pay the tariffs if they
alarmed trading partners by askhave security partnerships with ing for unrelated economic and
the U.S.
trade concessions in order to
They are further seeking faavoid the tariffs. He has also
vorable consideration if they
suggested additional barriers
agree to take measures address- against European cars.
ing overcapacity—largely blamed
“We are in contact with U.S.
on China—and ship products
counterparts to obtain more
that don’t undermine production clarity,” the European Union’s
by American metals firms.
trade chief, Cecilia Malmström,
Some U.S. lawmakers and
said Wednesday.
foreign officials have criticized
An EU official said Mr. Lighthe tariffs and sought to learn
thizer “indicated that there
more about how to obtain counwould be some criteria applied
JONATHAN ERNST/REUTERS
BY WILLIAM MAULDIN
AARON JOSEFCZYK/REUTERS
High Bar Set
For Tariff
Exclusions
could be imposed next week.
for country exclusions” and
that “jointly tackling steel overcapacity is one.”
A spokeswoman for Mr.
Lighthizer declined to comment.
Mr. Lighthizer raised the
possibility of allies limiting their
steel and aluminum exports to
the U.S. in exchange for obtaining waivers exempting them
from the tariffs, an EU official
said.
The tariffs could be imposed as early as next week.
—William Mauldin
and Emre Peker
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THE WALL STREET JOURNAL.
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THE WALL STREET JOURNAL.
A10 | Thursday, March 15, 2018
WORLD NEWS
U.S. Says Afghan Peace Prospects Improve
Army Gen. John
Nicholson, on Kabul
visit, strikes upbeat
note on reconciliation
KABUL—The commander of
American-led military forces in
Afghanistan said prospects for
reconciliation between the Afghan government and Taliban
militants are improving, though
former officials and experts expressed concern that U.S. diplomatic resources for negotiating a solution are inadequate.
A comprehensive offer by
Afghan President Ashraf Ghani
late last month, coupled with a
recent Taliban request for
talks with the U.S., come as
the U.S. and its allies start a
military campaign with thousands of new forces.
“We have a moment where
the objective of our campaign
and reconciliation are in play,
so this is significant,” Army
Gen. John Nicholson, the commander of U.S. and NATO
forces in the country, told reporters here Wednesday.
However, questions about
Washington’s willingness and
capacity to negotiate have been
raised by former officials and
experts, some citing departing
Secretary of State Rex Tillerson’s decision last year to eliminate the post of senior envoy
for Afghanistan and Pakistan.
JAWAD JALALI/EPA/SHUTTERSTOCK
BY GORDON LUBOLD
AND NANCY A. YOUSSEF
Gen. John Nicholson, left, commander of American-led military forces in Afghanistan, said conditions for peace in the country are improving.
“If there was the prospect
of real substantive talks being
launched, the U.S. would need
someone to work on this full
time,” said Laurel Miller, who
until 2017 served as the State
Department’s special representative for Afghanistan and
Pakistan. “The fact that there
is not such a person now sug-
gests it is not a priority or the
process is not there yet.”
Mr. Tillerson’s ouster on
Tuesday added a new wrinkle
to diplomatic prospects in Afghanistan. Mr. Tillerson was
fired by President Donald
Trump, who nominated Central Intelligence Agency Director Mike Pompeo to succeed
him. Mr. Pompeo, once confirmed, would have to install
his own senior aides and organize any U.S. diplomatic effort.
Talk of a political settlement in the 16-year war comes
amid pressure in the U.S. to
show progress in Afghanistan
through Mr. Trump’s new
strategy, announced in August,
Merkel Resumes in a Tough Milieu
BY BOJAN PANCEVSKI
Continued from page A1
tank with close ties to the
British government. He said
Russia’s membership in the
United Nations Security Council meant the U.K. must balance the desire to punish Russia with progress on global
issues like the conflict in
Syria.
Mrs. May said the 23 Russian diplomats had been identified as undeclared intelligence officers and would have
one week to leave. She said
the expulsions would degrade
Russia’s intelligence capability
in Britain for years to come.
Russia’s Foreign Ministry
said Mrs. May’s actions constituted an “unprecedented, flagrant provocation that undermines the foundations of
normal dialogue between our
countries.”
The ministry said the U.K.
had launched a groundless
anti-Russian campaign. “Needless to say, our response measures will not be long in coming,” it said Wednesday.
The expulsion is the biggest
from the U.K. since 1985, when
the country required 25 Soviet
citizens accused of spying to
leave. In 1971, the U.K. demanded the departure of 90
The German chancellor, seated, starts a fourth term tested by trade, EU reform and migration.
Mr. Trump’s recent threats
that Washington could impose
a 25% levy on European car
imports hit at Germany’s flagship industry and at the heart
of its export-oriented economic model.
After almost a year of absence from the international
stage during the electoral
campaign and protracted coalition talks, Berlin must now
take a position on demands by
Soviet diplomats after a KGB
defector revealed details of
their espionage activity.
In the U.S., then-President
Barack Obama expelled 35 suspected Russian intelligence
operatives in 2016 and blocked
access to two Russian diplomatic sites in response to Russian efforts to interfere with
the presidential election.
Mrs. May, who had faced
pressure from lawmakers to
announce tough action against
Russia, announced a range of
other measures, including the
freezing of Russian state assets if there was evidence they
could be used to threaten life
or property in the U.K. She
said some other measures
taken couldn’t be shared publicly for national security reasons.
The U.K. is suspending
high-level bilateral contacts
with Russia, the prime minister said, and won’t send ministers or members of the royal
family to the soccer World
Cup in Russia over the summer.
Mrs. May said she would introduce legislation to stop
people suspected of hostile
state activity from entering
the U.K., broadening measures
currently directed only at terrorism suspects.
She said she would also
propose laws to increase the
French President Emmanuel
Macron for reform of the EU.
Mr. Macron outlined an ambitious set of proposals that
would require higher German
spending and sharing of financial risks—neither of which is
popular in Europe’s largest
economy. His agenda includes
a common budget and a joint
eurozone finance minister.
More than in her previous
terms, Ms. Merkel will have to
contend with domestic headwinds.
The 2015-16 migration crisis, in which more than a million asylum seekers streamed
into the country, played a big
role in her disappointing election results. It also helped
propel the five-year-old Alternative for Germany, a strident
anti-immigration movement,
into parliament as the largest
opposition party.
May Seeks Law
Targeting Moscow
For Ex-Spy’s Attack
PETE MACLAINE/I-IMAGES/ZUMA PRESS
RUSSIA
War-Rattled Lebanon
Seeks Aid From Abroad
BY SUNE ENGEL RASMUSSEN
AND NAZIH OSSEIRAN
JOHN MACDOUGALL/AGENCE FRANCE-PRESSE/GETTY IMAGES
BERLIN—Angela
Merkel
began her fourth and likely
last term as German chancellor on Wednesday facing some
of the toughest domestic and
international challenges of her
years in power.
Germany’s parliament formally elected Ms. Merkel as
chancellor after a long and
complicated coalition-building
exercise.
As she heads a fractious
government of political opposites whose popular support is
waning, Ms. Merkel will have
to fend off economic threats
from the U.S., address neighbors’ demands for European
Union reform, and try to preserve political and social cohesion in a country tested by a
huge inflow of migrants.
Ms. Merkel’s renewed grand
coalition between her conservatives and the Social Democrats is beginning under the
threat of a trade war. With
President Donald Trump at its
helm, the U.S. has turned from
Germany’s closest postwar
partner into a rival.
Mr. Trump has piled criticism on Berlin for the country’s vast trade surplus and its
meager defense spending, demanding it decrease the former and boost the latter, neither of which Ms. Merkel’s
coalition appears to have any
intention of doing.
to send more troops as advisers and not remove them until
conditions improve. He sent
nearly 4,000 more troops last
fall to join the roughly 10,000
already in Afghanistan.
The Taliban haven’t formally responded to Mr. Ghani’s
offer of reconciliation, which
Gen. Nicholson said he takes
Prime Minister Theresa May
decried a ‘flagrant provocation.’
nation’s ability to place sanctions on countries suspected
of human-rights abuses, such
as those suffered by Sergei
Magnitsky, a Russian anticorruption lawyer who died in
2009 while in the hands of
Russian authorities.
An emergency meeting of
the Security Council on
Wednesday turned into an airing of accusations and counteraccusations between the
West and Russia. The U.K.,
backed by the U.S. and France,
cited Russia for a pattern of
disregarding international law
and reckless acts that it said
threatened the security of
other countries.
LONDON—U.K. Prime Minister Theresa May said Britain
would introduce legislation similar to the U.S. Magnitsky Act
as part of its broadside against
Russia, marking another potential victory for supporters of
Russian lawyer and whistleblower Sergei Magnitsky, who
died in prison in 2009.
The U.S. law, passed in
2012, permitted U.S. officials
“This is how Russia has
acted in every other case
where it has been caught
flouting international law: denial, distraction and threats. It
is what Russia does,” said Jonathan Allen, Britain’s deputy
ambassador to the U.N.
Russia’s envoy, Vassily
Nebenzia, rejected the accusations. “I do think we could all
stand to benefit from having a
Sherlock Holmes with us today,” he said. “We demand
material proof be provided of
the alleged Russian trace in
this event.”
The North Atlantic Treaty
Organization said it was
deeply concerned about the
as a positive sign. The group
did publish an open letter last
month urging the U.S. to negotiate and small numbers of the
Taliban have hinted they are
interested in talks. American
officials, however, have insisted that any settlement
must be Afghan-led.
Meanwhile, some elements
of the Taliban are fracturing,
Defense Secretary Jim Mattis,
said on a two-day visit here
this week. “All wars come to
an end,” Mr. Mattis said on
Tuesday. “You don’t want to
miss an opportunity because
you weren’t alert to an opportunity, so you want that door
open.”
Besides the special envoy
post, the State Department has
a number of other officials with
responsibilities for Afghanistan.
The new U.S. ambassador in Kabul, John Bass, is experienced
and well-regarded, but has limited experience there. Alice
Wells, the principal deputy assistant secretary for South and
Central Asia, is among officials
who would lead U.S. efforts to
reach a diplomatic settlement
with the Taliban.
Other experts said the U.S.
has emphasized the military
fight over diplomatic efforts.
“We have been much more
clear about the fighting piece
than the talking piece,” said Andrew Wilder, vice president of
Asia programs at the U.S. Institute of Peace. “To really move it
forward, it really does need
more diplomatic attention.”
BEIRUT—A high-level Lebanese delegation, faced with tensions on the border with Syria
and financial strains at home, is
setting off on a European tour
to solicit aid from allies who see
the country as a bulwark for
stability in a volatile region.
At a 40-nation donor conference in Rome on Thursday, Lebanon will seek to bolster its security forces with fresh pledges
of support and aid. The delegation, which is led by Prime Minister Saad Hariri and includes
his top security chiefs, also aims
to strengthen ties with foreign
governments that want to counterbalance Iran’s growing influence in the country. U.N. Secretary-General António Guterres
and European Union foreignpolicy chief Federica Mogherini
will lead the donor side.
At a conference in Paris in
April, Lebanese officials are
then expected to seek $17 billion in economic support for
Beirut, likely in the form of
soft loans to invest in infrastructure and development.
The tiny Mediterranean nation
is reeling from an influx of
Syrian war refugees, while political infighting has paralyzed
economic decision making. At
148%, Lebanon’s debt-to-GDP
ratio is the third-highest in
the world, with annual growth
projected around 2% in 2018.
Later in April, at a EUhosted conference in Brussels
to support Syria, Lebanon will
ask for financial assistance to
manage the 1.5 million Syrians
it says have fled to Lebanon
from the seven-year war at
home. Lebanese officials estimate the refugee crisis has cost
the country billion of dollars.
Western diplomats say large
amounts of aid are needed to
shore up Lebanon’s government and finances at a time
when Hezbollah, the homegrown Shiite paramilitary and
political group, has assumed an
increasingly powerful role in
the country. Backing away now
would risk empowering the
Iran-backed group, they say.
“We’re committed to a
strong, safe and stable Lebanon,” said U.K. Ambassador to
Lebanon Hugo Shorter in an
email. “That means strong
state institutions.”
Boosted by its role in propping up the regime of Bashar alAssad in Syria’s war, Hezbollah
has emerged as a powerful regional force. It has, in turn,
wielded that clout across Lebanon. In some parts of the country, the group’s parallel security
apparatus rivals the national security forces. Both defend Lebanon’s borders against extremist
groups like Islamic State.
to freeze the assets and ban
the entry of Russians believed to be implicated in Mr.
Magnitsky’s death and in human-rights violations more
broadly.
It was expanded in 2014 to
target human-rights abusers
world-wide, and similar legislation has since been adopted by
countries including Canada, Estonia, Latvia and Lithuania.
In her speech laying out
measures to hit back at Moscow over the poisoning of exspy Sergei Skripal and his
daughter, the prime minister
described a plan inspired by the
act that would amend sanctions-related legislation currently being debated by Parliament to target those
implicated in violations of human rights.
Lawmakers from Mrs. May’s
ruling Conservatives and opposition parties have voiced their
support.
Mr. Magnitsky died at age
37 in a Moscow jail after repeatedly complaining to the authorities that he was being denied adequate medical care. He
had been imprisoned on
charges of tax evasion.
—Jason Douglas
first offensive use of a nerve
agent on an ally’s territory
since the group was founded.
NATO called on Russia to provide a full disclosure of its
nerve- agent program and
called the attack a clear
breach of international norms
and agreements.
“Russia did commit this act,
based on all the evidence that
Britain has available,” White
House spokesman Raj Shah
told reporters Wednesday afternoon.
Donald Tusk, president of
the European Council, said he
stood with the U.K. and that
EU leaders would discuss the
attack at a meeting next week.
The Organization for the
Prohibition of Chemical Weapons, based in The Hague, is
also expected to discuss the
attack, European diplomats
said. Mrs. May said the U.K.
was working with the OPCW
to independently verify Britain’s analysis.
The U.K. Foreign Office issued updated guidelines to
Britons traveling to Russia in
the coming weeks, saying they
should be aware of possible
anti-British sentiment or harassment.
—Farnaz Fassihi at the U.N.,
Julian E. Barnes in Brussels
and Wiktor Szary in London
contributed to this article.
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | A11
WORLD WATCH
Physicist Stephen Hawking,
who made complicated concepts
like black holes, time and the
history of the cosmos accessible
to the masses, has died at the
age of 76.
Dr. Hawking “died peacefully
at his home in Cambridge,” England, according to a statement
provided by his family.
The University of Cambridge
professor was an iconic figure
in both the scientific community and in popular culture,
known for his keen mind and
humor, as well as his striking
physical challenges. Dr. Hawking
had long lived with amyotrophic
lateral sclerosis, which left him
wheelchair-bound for most of
his life.
Dr. Hawking devised seminal
theories that have shaped scientists’ and the public’s understanding of black holes and the
beginning of the universe.
“He has pioneered completely
new areas in physics,” Caltech
physicist Kip Thorne said in
2015.
—Daniela Hernandez
PHILIPPINES
Duterte Says Manila
Will Leave the ICC
President Rodrigo Duterte
plans to pull his country out of
the International Criminal Court,
putting the court’s inquiry into
alleged crimes against humanity
in the Philippines in doubt.
Mr. Duterte is waging a
bloody war on drugs that has
killed thousands of mostly poor
people in the Philippines, many
of whom rights groups say were
executed by police officers. The
government denies that authorities systematically execute suspects.
Mr. Duterte said in a draft
statement Wednesday that the
ICC “is being utilized as a political tool against the Philippines”
and he intends to withdraw
“given the baseless, unprecedented and outrageous attacks
on my person as well as
against my administration” by
the court and by United Nations
officials.
The ICC, based in The Hague,
the Netherlands, didn’t respond
to a request to comment.
—Jake Maxwell Watts
AUSTRALIA
A Defense Pact With
Vietnam Is Drawn Up
A deal boosting defense ties
with Vietnam, potentially heralding future multinational naval
patrols in the contested South
China Sea, will add to regional
stability, Australian Foreign Minister Julie Bishop said.
Vietnamese Prime Minister
Nguyen Xuan Phuc and his Australian counterpart, Malcolm
Turnbull, will sign an agreement
on Thursday paving the way for
greater defense and trade ties
just days after a U.S. Navy aircraft carrier visited Vietnam in a
rapprochement driven by China’s
muscle-flexing in the flashpoint
area.
Australia, which will host
nine Southeast Asian leaders
this weekend for talks on counter-terrorism, security and
trade, has been locking in
agreements with counterparts
including the Philippines and
Singapore as a hedge against
instability as global powers
such as China, the U.S., India
and Japan jostle for influence in
the Indo-Pacific region.
—Rob Taylor
Venezuelan Rebel Bets on Dollar
BY KEJAL VYAS
AND ANATOLY KURMANAEV
CARACAS,
Venezuela—
When President Nicolás Maduro earlier this year scheduled a presidential election for
the spring, the country’s opposition called a boycott to protest a vote it saw as bound to
be heavily tilted in the president’s favor.
But one former state governor, Henri Falcón, declared his
candidacy anyway, a move seen
as quixotic by some and treasonous by those who accuse
him of legitimizing what they
say will be a rigged election,
citing evidence of fraud and
voter intimidation in the unpopular government’s romps to
victory in votes held in July
and October.
“This is a cheating government, controlling of everything, unscrupulous—but it is
beatable,” Mr. Falcón, 56 years
old, said in an interview.
The onetime army sergeant
and former Socialist Party loyalist said he would win the
May 20 election by offering
what no one in government or
the opposition has proposed:
adopting the U.S. dollar to halt
hyperinflation. He said the
proposal could prove popular
with Venezuela’s poor, who
have been buffeted by the collapsing local currency, the
bolívar.
Disavowed by the opposition,
Mr. Falcón has joined forces
with Francisco Rodríguez, a
Harvard-trained Venezuelan
WIL RIERA/BLOOMBERG NEWS
Stephen Hawking,
Physicist, Dies at 76
Presidential candidate Henri Falcón would have his country adopt the U.S. dollar to quash inflation.
economist who recently took
leave from the New York investment firm where he works
to become the campaign’s
chief policy adviser. Together,
they have tailored a program
they said would lift Venezuela
from economic ruin, including
eliminating exchange controls
that deter foreign investment
and seeking help from the International Monetary Fund,
which the current government
decries as a tool of imperialism.
Mr. Falcón also said a blan-
ket amnesty could be offered
to ruling-party officials and
military officers accused of
rights abuses and corruption.
While many in the opposition
see an amnesty as akin to impunity, Mr. Falcón casts it as a
peaceful out for officials in Mr.
Maduro’s regime holding on
for fear of being prosecuted if
power changes hands.
“I’m representing the millions who are clamoring for
change, and so you have to
call the nation to an understanding, to take the path of
reconciliation,” he said.
Polls show Mr. Falcón
clearly more popular than Mr.
Maduro, who is disliked by
three out of four Venezuelans.
But the challenger faces a
slanted electoral playing field.
There are no independent
election monitors and the National Electoral Council is
stacked with the president’s
allies. The U.S., Canada and
the European Union have already said the vote will be illegitimate.
Mr. Falcón also faces a ma-
jor challenge in persuading his
compatriots to vote, defying
the boycott by the opposition’s
largest parties.
“There is no way I’m voting,” said Aquiles Martini, a
businessman who would normally support a Maduro foe.
“At some point you just feel
you’re being made a fool of.”
Mr. Falcón is seeking to appeal to moderates by pledging
to open the country to humanitarian aid that Mr. Maduro
has long rejected even as citizens face food and medicine
shortages. His first act as
president, he said, would be to
free all political prisoners, including the country’s top opposition leader, Leopoldo López, and Josh Holt, a Utah
man locked up on espionage
charges.
In seeking to carve out
space as a politician of the
moderate, democratic left, Mr.
Falcón now favors businesslike
gray suits and a clean-shaven
face. Gone are the red baseball
cap, mustache and flannel
shirt that once reflected his
allegiance to former leftist
leader Hugo Chávez.
Mr. Chávez’s Socialist Party
branded Mr. Falcón a traitor
after he broke from it in 2010
to protest the planned expropriation of industrial land that
would have jeopardized thousands of jobs in his state, Lara.
Opposition leaders today, in
contrast, see Mr. Falcón as secretly loyal to the government
and refer to him as “Falsón,”
Spanish for “Big Phony.”
Mexico Prosecutor: Graft Probe Led to Firing
BY JUAN MONTES
MEXICO CITY—The bribery
scandal around Brazilian construction giant Odebrecht has
led to criminal charges against
former presidents in Brazil
and Peru. But in Mexico it has
brought about a different outcome: the firing of the prosecutor looking into whether any
Odebrecht money financed
President Enrique Peña Nieto’s
2012 campaign.
Now the prosecutor who
was fired is speaking out, saying he was dismissed to stop
several investigations he had
launched, including into alleged Odebrecht bribes.
“I was an annoying prosecutor for the government and
they wanted me out,” said
Santiago Nieto, in his first extensive interview since his firing in October. He and the
president aren’t related.
Mr. Nieto’s comments come
amid a growing uproar in
Mexico over rampant corruption as the country gears up
for presidential elections in
July. The front-runner, leftist
nationalist Andrés Manuel López Obrador, has made fighting graft his main theme. The
ruling Institutional Revolutionary Party’s candidate, José
Antonio Meade, is running a
distant third in polls.
Mr. Peña Nieto has denied
any wrongdoing.
Several former Odebrecht
officials have told Brazilian
prosecutors under oath that to
secure Mexican government
contracts for their firm, they
paid $10 million in bribes to
Emilio Lozoya while he was a
top aide of Mr. Peña Nieto, according to transcripts The
Wall Street Journal has seen.
Mr. Lozoya, who has denied
all wrongdoing, voluntarily
testified in October before
Mexico’s attorney general’s office. He hasn’t been charged
with any crime.
The office of Mexico’s attorney general said Mr. Nieto was
fired for illegally disclosing details of an active investigation.
ALFREDO ESTRELLA/AGENCE FRANCE-PRESSE/GETTY IMAGES
UNITED KINGDOM
WORLD NEWS
Enrique Peña Nieto in his successful 2012 presidential campaign.
The former prosecutor gave a
newspaper interview days before he was dismissed in October wrongly suggesting Mr. Lozoya had pressured him in a
letter to drop the matter. Mr.
Lozoya then released the letter,
in which he had merely asked
to be summoned to testify.
Mr. Nieto acknowledges his
mistake, but says the controversy over the letter was part
of a broader effort to get him
out of office and silenced.
Shortly after being fired,
Mr. Nieto was summoned to a
hotel by a top interior minister official, he says. The official told him the government
wanted to maintain a good relationship with him, Mr. Nieto
says, and offered him money
to tide him over after the loss
of his job.
“They sought to buy me off
to remain silent,” Mr. Nieto
said. “I just replied: ‘Sorry, but
I can’t receive any money from
Peña Nieto.’ ”
The interior minister official, Jorge Márquez, who no
longer works in the government, confirmed he met Mr.
Nieto but denied offering him
any money. Mexican presidential spokesman Eduardo Sánchez declined to comment on
Mr. Nieto’s allegations.
Mr. Nieto says efforts to silence him didn’t stop there.
His wife told him she was
anonymously sent photos of
him with another woman, as
well as flirtatious texts between him and other women,
according to the former prosecutor. The marriage soon
ended. Then came a series of
threatening messages via
anonymous Telegram accounts, including one with the
alias “Death Follows You.”
“Word of advice: Stay out
of trouble,” one of the messages said.
Slovakian Prime Minister Offers to Resign Amid Protests
BY DREW HINSHAW
Slovakian Prime Minister
Robert Fico offered to resign in
the wake of the Central European country’s biggest protests
since the fall of communism.
Mr. Fico, prime minister
since 2012, on Wednesday told
President Andrej Kiska that he
was prepared to step down,
five days after some 120,000
people protested alleged corruption and the killing of Jan
Kuciak, a 27-year-old reporter.
Mr. Kuciak, who worked for
a Slovakian news website, was
found dead along with his fiancee in their home late last
month. He was investigating
alleged ties between Mr. Fico’s
office and an Italian crime network.
The prime minister has
called corruption allegations
against him an untrue, foreign-backed conspiracy.
Mr. Fico, who has promised
a €1 million ($1.24 million) reward for information that
leads to the killers’ arrest, stipulated that his Direction-Social
Democracy party, which he has
led since 1999, retain control in
order for him to resign.
It wasn’t clear if Mr. Kiska
and Mr. Fico’s allies in government would accept the offer. If
they don’t, Slovakia would
head for early elections.
Mr. Fico has been a political
survivor in a part of Europe increasingly at odds with neighbors to the West over immigration and the European Union’s
power. The 53-year-old former
communist has stayed close to
Germany and steered Slovakia
into adopting the euro. He has
counterbalanced those positions
by courting Slovakia’s nationalists, and repeatedly proposed a
ban on Muslim immigrants.
Corruption allegations have
dogged the prime minister,
sparking multiple protests in
the capital, Bratislava, last year.
Mr. Kuciak was investigating why Mr. Fico hired Maria
Troskova, a 29-year-old exMiss Universe contestant with
no experience in politics as his
primary government adviser
in 2016. The slain journalist
had reported that Ms. Troskova had once co-owned a business with a man wanted in Italy for transporting goods for
the powerful ’Ndrangheta
crime organization.
Mr. Fico has declined to say
why he hired Ms. Troskova,
but has said she has no criminal involvement with the
’Ndrangheta or any role in the
reporter’s death.
Ms. Troskova stepped down
from her post last week, saying she had no connection to
Mr. Kuciak’s killing.
The new theme parks, experiences and consumer products division headed by Mr.
Chapek will combine the parks
and resorts business he currently oversees with the
smaller consumer-products
business he used to run. He
now has oversight of translations of Disney characters and
stories created in film and TV
into other media, whether in
theme parks, on toy shelves,
online or in games.
Combined, consumer products and theme parks would
overtake television to become
Disney’s largest business. They
generated a total of $6.6 billion in revenue and $1.97 billion in operating income during Disney’s fiscal first
quarter, which ended Dec. 30.
With his background in
deal-making and digital savvy,
Mr. Mayer could be well positioned to lead Disney in the
new businesses it will need to
conquer to maintain its dominant position in entertainment
in the next decade.
Mr. Chapek has less experience in digital media but is a
seasoned operational executive who has held senior positions in several of the company’s major businesses.
Succession at Disney has
been murky since Mr. Staggs
left after Mr. Iger informed
him he was unlikely to become
the next CEO, as had previously been expected. Mr. Iger
has since extended his employment contract twice, first
through 2019 and then, should
the Fox deal close, until the
end of 2021.
Mr. Iger last week faced a
rare expression of criticism
from shareholders when 52%
of them voted not to approve
of his compensation following
the board’s decision to grant
him lucrative bonuses to stay
on to help integrate the Fox
assets. The shareholder vote
was nonbinding.
—Imani Moise
contributed to this article.
FROM PAGE ONE
DISNEY
Continued from Page One
ESPN, further raising the profile of a third fast-rising executive. Disney insiders consider
him another possible future
CEO, but a longer shot.
Messrs. Chapek, 58, and
Mayer, 55, have both worked
at Disney for more than 20
years, while Mr. Pitaro, 48,
joined in 2010.
Mr. Iger recently extended
his contract through 2021,
contingent upon the company
closing its December agreement to acquire most of the
assets of 21st Century Fox
Inc. for $52.4 billion. Since
former Chief Operating Officer
Tom Staggs was pushed out
two years ago, there hasn’t
been a clear successor to Mr.
Iger.
At a recent investor conference, Mr. Iger said he had
been “thinking hard about how
best to structure the company” so that once the deal is
complete, “we’ll be ready…to
hit the ground running.”
Mr. Mayer was intimately
involved in the Fox deal and
the purchase of streamingtechnology company BamTech.
He has also been heavily involved in plans to launch next
year a Disney-branded streaming service that would compete with Netflix Inc.
His new business unit
would oversee that service and
BamTech, as well as an ESPN
streaming service set to debut
by early April. In addition,
should the Fox deal be approved by regulators, it would
give Disney and Mr. Mayer’s
division control of a third
streaming service, Hulu. The
new segment will also oversee
global advertising sales for
Disney-owned television channels, sales of content to other
distributors, and the international Disney Channels.
Mr. Mayer, who has over-
Reorganizing Mouse’s House
Disney plans to combine two segments and create a new one for
direct-to-consumer streaming.
Existing segments by 2017 revenue
New segments
Consumer Products $4.8B
Parks,
and Interactive
Media
Parks and Resorts
Studio
Entertainment
Media
networks
Experiences and
Consumer
Products
18.4
8.4
Unchanged
23.5
Largely
unchanged
Includes new streaming services, content
sales and overseas Disney Channels
Source: the company
seen strategy and business development since 2005, has
never previously had an operating role at the company, a
significant deficiency in his
potential candidacy to succeed
Mr. Iger. He now has oversight
of nearly all distribution of
Disney-produced films and
?
Direct-to-Consumer
and International
THE WALL STREET JOURNAL.
television shows outside of
theaters, home video and domestic broadcast and cable-TV
networks.
Disney’s movie studio, overseen by Alan Horn, and television division, run by Mr. Pitaro
and Ben Sherwood, will remain largely intact.
.
THE WALL STREET JOURNAL.
A12 | Thursday, March 15, 2018
STOCKS
Continued from Page One
of trading activity.
The NYSE operates each
day between 9:30 a.m. and 4
p.m., but more than ever the
action is compressed in the final minutes. Brokers congregate on the exchange’s floor to
call out their last orders before the closing bell, a brief
throwback to the old days.
Last year, 26% of all trading
activity on the NYSE’s flagship
exchange took place in the last
trade of the day, up from 17%
in 2012, exchange data shows.
Last year, trades at the close
accounted for more than 8% of
trading volume in S&P 500
stocks, nearly four times what
it was in 2004, according to
Credit Suisse.
While individual investors
may follow the market
through the day, especially in
the past turbulent weeks, it is
likely they own funds that
track major stock indexes like
the S&P 500 whose values depend on prices determined in
the closing auction.
In this auction, traders
electronically send transaction
orders to the NYSE, home to
more than 2,000 companies
that include such blue-chip
names as Boeing Co., Walt Disney Co. and Exxon Mobil Corp.
The exchange’s computers
match the millions of buy and
sell orders, with human traders on the NYSE floor sometimes stepping in to help.
At least $10 billion worth of
shares are traded in the
NYSE’s closing auction on an
average day, with a final tally
of stock prices typically listed
by 4:05 p.m.
The “close,” as traders call
it, has grown in importance as
investors pour into index-mutual funds and other vehicles
that passively track various
stock-market indexes, including exchange-traded funds, or
ETFs. These funds aim to
mimic the holdings of significant indexes, such as the S&P
500 or baskets of stocks. Some
correspond to specific economic sectors, for instance.
Such funds have gained in
popularity as investors have
seen that tracking the overall
market has been more profitable than trying to beat the
market by stock picking.
Index-tracking funds often
depend on buying and selling
shares using the last price of
the day. Fund managers fear
that if they miss a last-minute
price move, they will deviate
from the index or market they
are supposed to track.
It all adds up to an intricate
choreography among traders,
exchanges and trillions of dollars worth of funds. If all parties do their job, the closing
auction has no reason to draw
much attention from the
broader investor community.
Yet the stakes are higher
than ever. “If the primary listing exchange, whether it be
the NYSE or Nasdaq, can’t run
the closing auction, all hell
breaks loose,” said Greg Tusar,
former global head of electronic trading at Goldman
Sachs Group Inc.
Midday doldrums
The floor of the NYSE at
EYE
Continued from Page One
jing would keep tabs on overseas
investment
under
President Xi Jinping’s Belt-andRoad infrastructure program.
Her query meandered. “The
transformation of the role of
state-assets supervision, centered on capital management,
is currently a subject of widespread concern,” she said, then
kept talking.
The clock ticked.
Disdain appeared to creep
across the face of the woman
in blue as she listened to the
roughly-45-second softball.
When the woman in red finally got around to her main
question, the woman in blue
had raised a fist to her chin
and furrowed her eyebrows.
She cast sideways glances at
the speaker and around her.
Then, with a toss of the head,
she executed an eye-roll to
make Miley Cyrus proud.
For viewers, it was a rare
flash of unscripted emotion
amid stage-managed tedium.
“It was like she was expressing
frustration on behalf of the rest
of us” over the scripted nature
of the event, says Zhang Lifan,
a Beiijng-based independent
historian who has written critically about the government.
the start of the century hosted
about 5,000 traders. Now, its
workaday population numbers
in the hundreds, and it is
mostly quiet.
On a recent Monday afternoon, several floor brokers reclined in their seats. One
trader’s screen, instead of a
labyrinth of green and red
trading data, lingered on a site
of popular internet memes.
“There’s no volume during
the day,” said Dermott Clancy,
who works for Cuttone & Co.
He has handled buy and sell
orders at the NYSE since the
1980s, he said, and now often
doesn’t bother to show up before 2 p.m.
Traders around the U.S.,
representing investors worldwide, enter orders all day to
buy or sell shares in the closing auction, either submitting
them electronically or asking a
floor broker to execute the
trades at the exchange. One
popular way to submit such
orders is to limit them by a
price floor or ceiling.
After 3:45 p.m., the rules
shift so that the biggest orders
for the auction must be routed
through a floor broker. These
brokers, who trade on behalf
of such clients as banks and
mutual funds, can execute
their customers’ end-of-day
trades through special handheld devices or by shouting
orders on the exchange floor.
Taking those orders and
overseeing NYSE’s closing auction are a handful of firms
called designated market makers. Their traders, also called
specialists, stand at posts in
the middle of the exchange
More than $10 billion
worth of shares are
traded in the NYSE’s
closing auction.
MICHAEL BUCHER/THE WALL STREET JOURNAL (2)
IN DEPTH
Stock traders and brokers on the floor of the New York Stock Exchange in the day’s last minutes.
ist to close each stock that he
or she oversees. Much of the
time, the specialist will just
hit a button for a computer to
close the stock at the price
that matches the largest number of buyers and sellers.
Yet if trading has been especially volatile, or if there are
big imbalances between the
number of shares bid and offered in the auction, the specialist might intervene to
make sure there isn’t a drastic
price move. Intervention can
include a specialist committing his or her firm’s money to
buy or sell shares.
Many other exchanges in
the U.S. and overseas end
their day with closing auctions. But the NYSE, owned by
Intercontinental Exchange Inc.,
is among the only ones to allow human traders on the
floor to play a central role.
It is a vestige of an earlier
era. NYSE veterans like Neil
Catania, managing director of
floor operations for TJM Investments, say it is a point of
honor to stand by the orders
that they shout out on the exchange floor: “Once you call it
out, you’re locked into it.”
Keeping Investments On Track
The rise of investment vehicles that mimic the holdings of various
stock-market indexes has pushed a growing proportion of stock
trades to the final bell.
End-of-year assets under
management for index mutual
funds and ETFs
The percentage of S&P 500
shares traded in the closing
auction each year
$6 trillion
8%
5
6
4
4
3
2
2
1
0
0
2010 ’11 ’12 ’13 ’14 ’15 ’16 ’17
2004 ’06 ’08
Sources: Investment Company Institute (assets);
Credit Suisse (shares)
’10
’12
’14
’16
THE WALL STREET JOURNAL.
THE WALL STREET JOURNAL.
A stock trader at the New York Stock Exchange checks updates.
ing or buying the indexed
stocks. To make sure the
stocks are in line with the index they are supposed to
track, the fund managers try
to buy or sell at the day’s closing prices.
Big investors like the closing auction because market liquidity is the greatest: It is
easier to trade large quantities
of shares without pushing
prices higher when buying or
lower when selling.
A fund manager such as
Vanguard, for instance, might
need to buy millions of shares
at a time. Making such a big
purchase midday could dry up
supply, causing the price of
the stock to jump—bad for
Vanguard. By waiting to trade
at a time when there are millions of shares being bought
and sold, the risk of moving
the price is reduced, saving
Vanguard money.
The NYSE also makes out
well. The exchange has collected hundreds of millions of
dollars in recent years in fees
from buyers and sellers for
carrying out trades in the
closing auction.
Under the current structure
of the U.S. stock market,
whenever a share is bought or
sold, that trade can take place
on any of 12 exchanges or dozens of other off-exchange platforms called dark pools. That
A meme was born, setting
phones vibrating around China.
Online, people divided into
red and blue camps—mostly
blue. Animated images of Ms.
Blue’s expressions exploded on
the WeChat messaging app. Tshirts and mobile-phone covers with images of the eye-roll
went on sale on Alibaba’s Taobao platform.
Ms. Red identified herself as
Zhang Huijun, a journalist with
American Multimedia Television USA, a little-known, Los
Angeles-based channel whose
website says it has worked
with state broadcaster China
Central Television on programming.
The policy she asked about
was typical congress fare. The
Belt-and-Road initiative is part
of Mr. Xi’s vision of Chinese
global leadership, involving
pledges to build infrastructure
and trade links between Asia
and Europe.
The eye-roller, Liang Xiangyi, a television reporter for
Shanghai-based Yicai Media
Group, emerged as a kind of
folk hero for those tired of the
turgid pageantry.
“No one really cares about
these sessions—not even the
journalists themselves,” says
Mr. Zhang, the historian. “So
people will just pay attention
to any interesting sideshow.”
Efforts to reach Ms. Liang
and Ms. Zhang weren’t successful. A senior Yicai editor
declined to comment Wednesday morning. AMTV didn’t respond to emailed inquiries. A
U.S.-based employee who answered the phone at AMTV declined to comment.
Some social-media users declared their “blue” sympathies.
Others deemed Ms. Liang’s reaction inappropriate. Online
were photos depicting the
standoff—side-by-side pictures
of red Coke and blue Pepsi
cans, food-delivery drivers
with red and blue boxes, strawberry-blueberry juxtapositions.
One commenter mixed images of the women with photos
of clashing soccer players in
red and blue jerseys, saying:
“When red meets blue, there
will always be discord.”
A Tuesday column on Chinese online-media firm Sina
Corp.’s technology news portal
attempted to explain why people roll their eyes: “Human
eyes feature more white areas
than those of other primates,
therefore we have a special
ability to communicate through
eyeball rotation.”
Some of Ms. Liang’s fans expressed worry she would be
punished for upstaging the
news briefing. Qin Weiping, a
Washington-based current-affairs commentator who often
criticizes China’s government,
legislative session for decades
for Italian newspapers. Every
year, he notes, state media
trumpets the number of foreign
correspondents in attendance.
“It’s like China is more and
more important,” says Mr.
Sisci, who wasn’t at the eyerolling event, “because they’re
all paying attention.”
Tuesday’s excitement followed a different outbreak of
enthusiasm during October’s
Communist Party congress,
when users of a free phone
game competed to “clap” for
Mr. Xi. It generated more than
1 billion claps.
Armchair analysts philosophized over the eye-roll uproar.
Wrote one user on social-media platform Weibo: “It means
that what we crave in these
sham,
everything’s-great
events is something real.”
Others shared videos of
their own eye-rolls, which they
termed inferior. Spoof videos
surfaced featuring men and
women re-enacting the scene.
On Zhihu, a question-andanswer website, a user solicited tips on how to eye-roll like
Ms. Liang. Someone replied:
“Start by looking at the other
person’s shoes, size up the person from bottom to top, and
add sounds such as ‘tsk’ or
‘humph’ for the best effect.”
The discussion later disappeared from the website. A
floor, where they are often
seen in the backdrop of business news TV shows.
Ten seconds before 4 p.m.,
the NYSE cuts off the ability of
floor brokers to execute the
biggest buy and sell orders
through their hand-held devices. If they still have unfilled
customer orders, they run to
the specialists’ posts to get
the trades done before the
closing bell.
Then it is up to the special-
On track
In the past decade, the
amount of money relying on
closing prices has soared as
mom-and-pop investors shift
from active funds to passive
funds. U.S. index-tracking mutual funds and ETFs have ballooned to roughly $6.7 trillion
in assets under management
at the end of 2017 from about
$1.9 trillion in 2010, according
to the Investment Company
Institute.
Such funds must shrink or
expand each day along with
the ebb and flow of investor
demand. They do this by sell-
Late Surge
Percentage of daily volume in
S&P 500 stocks by half-hour
interval
25%
20
15
10
5
0
10 to
10:30 a.m.
noon
2
Note: Based on data from March 1 to 8. First
and last half hours include the opening and
closing auctions, respectively.
Source: ITG
tweeted an offer to hire Ms. Liang as a guest host on his YouTube talk show if she were to
lose her job over the incident.
Ms. Liang “was like an innocent child who blurted out that
the emperor has no clothes,”
Mr. Qin says, adding that the
incident allowed “ordinary people with no opportunity to participate in politics to express
their scorn and discontent in a
roundabout way.”
Eye-roll emoji
The National People’s Congress press center said it didn’t
revoke Ms. Liang’s accreditation to cover the event. It
didn’t respond to other queries
about the eye-rolling incident.
In a setting where every effort is made to avoid embarrassment, not to mention sarcasm, the eye-roll was a jarring
departure.
Beijing likes using reporters
as props during political
events, says Francesco Sisci,
who has covered China’s annual
limits the NYSE from charging
too much for trades, or risk
losing out to a cheaper venue.
With the closing auction,
though, the NYSE is responsible for determining a final,
end-of-day price for each firm
listed on the exchange. If a
trader wants to buy or sell
shares at or near the NYSE’s
closing prices, the trader has
little choice but engage in the
closing auction—and pay the
NYSE fee.
Because 78% of companies
in the S&P 500 are on the
NYSE, the Big Board is home
to most of the last trades in
those stocks.
Last year, the NYSE collected $87 million—45% of its
net revenue from the exchange’s core stocks-trading
business—from the close, according to the research firm
Equity Research Desk. The
NYSE’s maximum fees for
trading at the close have gone
up 16% over three years, according to regulatory filings.
“There’s no question that
the costs have impacted clients and ultimately investors,”
said Joe Wald, chief executive
of Clearpool Group, a brokerage and trading-tech firm.
“Somebody has to pay for it.”
A competitor is seeking to
pry open the NYSE’s effective
monopoly. The Securities and
Exchange Commission recently
approved a plan by rival exchange operator Cboe Global
Markets Inc. to introduce a
new way to buy and sell
shares in NYSE and Nasdaqlisted companies at end-of-day
prices, but without paying fees
to the two exchanges. The
NYSE and Nasdaq have appealed the SEC decision.
The two big exchanges said
Cboe’s plan would make closing prices less trustworthy by
siphoning orders from their
auctions, reducing the quantity of trades that help the
NYSE and Nasdaq determine
end-of-day prices. Cboe has
dismissed such worries as
“fearmongering.”
The popularity of the last
trade has hedge funds and
quantitative trading firms convinced there must be ways to
make a profit by watching orders piling into the close and
trying to analyze the intentions of big investors.
Sometimes, a stock will
spike or drop at 3:45 p.m. if
the NYSE’s data reveals a big
imbalance between buyers and
sellers heading into the closing auction. The NYSE starts
distributing data electronically
at that time that shows if
there is such an imbalance.
Computerized
traders
watch the imbalance data. If
they see that buyers outweigh
sellers in a stock, for instance,
they can bid up its price.
“Essentially every quantitative firm has an angle to try to
profit,” said Michael Botlo, cofounder of Quantbot Technologies, which trades more than
$3 billion of shares for Steven
Schonfeld’s Schonfeld Strategic Advisors.
So far, none have admitted
to cracking the code, if there
indeed is one. “Some try to
guess which way the auctions
will go,” said Ewan Kirk, chief
investment officer of Cantab, a
$4 billion hedge fund owned
by Swiss asset manager GAM.
“We’ve looked…but predicting
them is quite challenging.”
Zhihu official didn’t respond to
requests for comment.
A piece published online by
Southern Metropolis Weekly, a
Guangzhou-based news magazine, declared that an analysis
of famous Chinese epics such
as “Journey to the West”—
known in the U.S. as the Monkey King tale—found that the
usage of the Chinese phrase
“rolling eyes” had evolved over
time and reflects different
meanings in various contexts.
But its modern connotation of
disdain had been around for at
least a thousand years, the
magazine said.
Weibo accounts named after
Ms. Liang and featuring her
photos popped up in apparent
homage.
Hu Xijin, editor in chief of
nationalist tabloid Global
Times, weighed in on his
Weibo account saying he hoped
censors wouldn’t muffle the
conversation.
“Ordinary people like this
kind of thing; the DNA of humanity can’t be changed,” he
wrote, calling such interest
“harmless.”
His post was later deleted,
according to censorship tracker
Free Weibo.
By Tuesday afternoon,
Weibo had blocked searches
for “Liang Xiangyi.”
—Xiao Xiao and Grace Zhu
contributed to this article.
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | A12A
NY
* *
GREATER NEW YORK
CENTRAL ISLIP, N.Y.—Federal prosecutors say a corrupt
relationship between former
Nassau County Executive Edward Mangano and restaurateur Harendra Singh began
with a $3,000 office chair.
In 2010, Mr. Mangano
printed a picture of the chair
off a website and handed it to
Mr. Singh, his friend of over
20 years, prosecutors said at
the opening of a trial in U.S.
District Court here Wednesday.
Mr. Singh then bought him the
chair and over years paid for
hardwood floors for Mr. Mangano’s home, a $7,300 watch
and vacations to places like Niagara Falls and Turks and Caicos, prosecutors said.
“This is a case about corruption and greed at the highest level of county government,” said Assistant U.S.
Attorney Lara Treinis Gatz.
Whether that chair and the
other items were bribes or
for comment.
Also on trial are Mr. Mangano’s wife, Linda, and John
Venditto, former supervisor of
the Town of Oyster Bay.
The trial is expected to be a
public airing of the inner
workings and backroom dealmaking inside the administration of the highest-ranking official in Nassau County.
The trial is also expected to
provide insight into Mr. Singh,
prosecutors’ key witness. Mr.
Singh pleaded guilty to bribing
Messrs. Mangano and Venditto
in a sealed courtroom in 2016.
In that courtroom, he also
pleaded guilty to bribing New
York Mayor Bill de Blasio. The
Democratic mayor has denied
being bribed, was never accused of wrongdoing, and after
a lengthy investigation, federal
and state prosecutors didn’t
charge him with a crime. Marc
Agnifilo, an attorney for Mr.
Venditto, said the defense may
seek Mr. de Blasio’s testimony,
depending on what Mr. Singh
says during the trial.
SHANNON STAPLETON/REUTERS
BY JOSEPH DE AVILA
AND CORINNE RAMEY
Edward and Linda Mangano, shown in 2016, both face charges.
gifts between friends is a central question in the trial. Mr.
Mangano, a once-powerful Republican who served as Nassau
County executive from 2010
through 2017, faces charges including bribery and extortion
for what federal prosecutors
say was an exchange of kickbacks for county contracts and
other actions.
In his opening statement,
his attorney, Kevin Keating,
said Mr. Singh led a secret life
of crime that he hid from Mr.
Mangano and his own family.
“Harendra Singh had a dark
side,” Mr. Keating said. “A man
incapable of telling the truth is
at the center of the government’s case.”
An attorney for Mr. Singh,
who will testify for the prosecution, didn’t return a request
A spokesman for Mr. de Blasio didn’t immediately return a
request for comment.
In opening statements, prosecutors outlined an alleged corruption scheme in which Mr.
Mangano pressured Mr. Venditto to help Mr. Singh with
loans for two of his restaurants
on property owned by Oyster
Bay. Mr. Singh needed the town
to back the $20 million in loans
he was seeking in order to win
approval from his lenders, prosecutors said.
Mr. Mangano allegedly
promised county jobs to Mr.
Venditto’s associates for his
cooperation. Mr. Singh also
provided Mr. Venditto with
limo service for special events
and other perks, prosecutors
said. Prosecutors said Mr.
Mangano also steered two
county contracts to Mr. Singh.
In return for his actions related to the loans and contracts,
Mr. Singh awarded Mr. Mangano a “sham” job for Ms. Mangano that paid $450,000 over
four years, prosecutors said.
New York Students Join Nationwide Walkout
More than 1,000 teenagers
at Stuyvesant High School in
New York City marched to an
athletic
field
chanting,
“Grades up, guns down.”
At P.S. 321 in Brooklyn,
fifth-graders tied orange ribbons onto a fence spelling “No
Place for Hate.”
And at a high school in Sayreville, N.J., a district official
said about two dozen teenagers joined the National School
Walkout, despite warnings
they could be suspended for
doing so.
Throngs of students across
the
metropolitan
region
vented their frustrations about
Americans’ easy access to assault weapons.
More than 100,000 of the
1.1 million students in New
York City public schools joined
the protests Wednesday, according to Mayor Bill de Blasio’s office. Organizers asked
students nationwide to walk
out of class at 10 a.m. for 17
minutes, one minute for each
person killed in the Parkland,
Fla., school shooting on Feb.
14.
At I.S. 289, a public middle
school in lower Manhattan,
students formed a circle in the
playground. Some held signs
bearing the name and age of a
Parkland victim. One boy
waved a poster that said,
“Books not Bullets.”
Carol Tatham Smith teared
up as she kept watch to make
sure her 13-year-old son was
safe. “I was worried someone
who doesn’t support it would
shoot the children,” she said.
“It’s pretty sad when it gets to
that point.”
Many educators embraced
the walkouts to encourage
civic engagement and assigned
TIMOTHY A. CLARY/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY LESLIE BRODY
Harvest Collegiate High School students in Washington Square Park. More than 100,000 city students took part in walkouts Wednesday.
staff to supervise them for
safety. Some countered that by
approving of the protests,
schools denied students the
opportunity to participate in
real civil disobedience. Others
sought to discourage the demonstrations altogether.
Kevin Ciak, school board
president in Sayreville, said
about two dozen students protested in some way, inside or
outside the high school, and
those who left school property
would get two-day suspensions. He said the district
sought to avoid interruptions
of instruction and had to treat
all viewpoints equally.
“Schools don’t have the
ability to pick political issues,”
he said. “Next week if there
were students who wanted to
advocate for the Second
Amendment, we would need to
do the same thing.”
In lower Manhattan, Stuyvesant was more embracing.
Principal Eric Contreras said
that while his school expects
students to pursue rigorous
academics, “equally important
is their understanding of their
role in shaping society.”
Some Stuyvesant alumni
came to cheer on protesters,
who shouted, “Hey, hey, NRA,
how many kids have you killed
today?”
Emily Wang, a 17-year-old
senior, said there should be a
federal assault-weapons ban.
‘“Maybe they should raise
the age of purchase too,” she
said. “It’s stupid. It’s illegal to
drink until 21 but you can buy
a gun at 18.”
In the morning, the National
Rifle
Association
tweeted a photo of a firearm
with the words, “I’ll control
my own guns, thank you.”
American Federation of
Teachers President Randi
Weingarten marched with students at Leadership and Public
Service High School in Manhattan.
Gov. Andrew Cuomo joined
them in chanting “Enough is
enough” and announced the
launch of a state website to
help students reach members
of Congress and state lawmakers to press for gun-safety
regulations.
—Mara Gay
contributed to this article.
Parents of Helicopter Crash Victim File Lawsuit
BY MELANIE GRAYCE WEST
The parents of one of the
victims of Sunday’s deadly helicopter crash in New York City’s
East River have filed a lawsuit
against the company and the pilot, saying the harness their son
wore on the flight prevented
him from escaping.
Dallas residents Jerry and
Nancy Cadigan filed the suit
Tuesday against Kearny, N.J.-
based Liberty Helicopters in
New York State Supreme
Court. Their son, Trevor Cadigan, a 26-year-old journalist
living in New York City, died in
the crash.
The lawsuit, which seeks unspecified damages, also names
the pilot of the helicopter, Richard Vance. Mr. Vance was the
only crash survivor.
The five passengers who
died on the photo tour of New
York City were required to wear
more complicated safety harnesses because the tours often
are done with the helicopter
doors open. The New York City
Medical Examiner on Tuesday
said the crash victims drowned.
A lawyer for the Cadigan
family said in a statement the
helicopter was a “death trap”
because there was no means to
escape from a tight harness, in
an upside-down helicopter in
frigid water temperatures.
“There was no prospect of
his safely evacuating this helicopter in that crash scenario,”
said attorney Gary C. Robb,
who is based in Kansas City.
A representative for Liberty
Helicopters didn’t immediately
respond to requests for comment. Mr. Vance couldn’t immediately be reached through a
family member or his employer.
The National Transporta-
tion Safety Board is investigating the accident and has said it
would be looking into the harness system. Liberty Helicopters has said it is cooperating
with the investigation.
The other victims were Carla
Vallejos Blanco, 29, a tourist
from Argentina; Brian McDaniel, 26, a firefighter from Dallas;
and Daniel Thompson, 34, and
Tristan Hill, 29, both of New
York.
BY MIKE VILENSKY
A day after a Manhattan jury
convicted a former aide to Gov.
Andrew Cuomo of public corruption, a new Republican rival
said he would challenge the
two-term Democratic governor.
Dutchess County Executive
Marcus Molinaro, whom party
leaders have encouraged to
run, cited the case against
longtime Cuomo confidant Joseph Percoco when he officially declared himself a candidate on Wednesday.
“Yesterday’s verdict is an
indictment, not just of one
man, but of the cynical systematic corruption within a
state government Gov. Cuomo
has led,” Mr. Molinaro said.
The 42-year-old is a former
teenage mayor of Tivoli, a village in the Hudson Valley. Key
Republican backers have said
he could be the most competitive candidate, after winning
his position in a Democrat-majority county. New York state
is predominantly Democratic,
though northern counties have
strong GOP voters.
Mr. Molinaro joins Sen.
John DeFrancisco and former
Gov. George Pataki aide Joseph
Holland in the race for the Republican nod. The emergence
of Mr. Molinaro’s candidacy
comes on the heels of the conclusion of the trial, which exposed the inner workings of
the Cuomo administration and
the backroom dealings of business in Albany.
Mr. Percoco, 48 years old,
was convicted of pocketing
some $315,000 from three businessmen, who stood trial
alongside him, in exchange for
providing government favors
while he was the executive deputy secretary to the governor.
Mr. Cuomo, who has campaigned on a pledge to clean
up Albany, wasn’t accused of
any wrongdoing. On Wednesday, he said the verdict was
“sad and shocking,” and he described Mr. Percoco’s behavior
as “a total aberration” in his
administration.
The governor also reiterated his support for a bill barring state lawmakers from receiving outside income. He has
called for such a measure after
past Albany-related corruption
convictions, but has faced objections from Republicans who
argue legislators should be average citizens rather than fulltime politicians.
In the wake of the trial, Mr.
Cuomo faces a host of criticism and questions from government watchdogs and fellow
lawmakers. The verdict has
prompted calls for more outside oversight of state contract
agreements, an investigation
of Mr. Percoco’s time in the
governor’s office, and more
stringent state ethics laws. Mr.
Cuomo referred to some of the
criticism as “political garbage.”
DUTCHESS COUNTY
Ex-County Executive Goes on Trial
Another
Republican
Takes Aim
At Cuomo
Marcus Molinaro enters race.
OYSTER PERPETUAL
cosmograph daytona
rolex
oyster perpetual, cosmograph and daytona
are ® trademarks.
.
A12B | Thursday, March 15, 2018
NY
THE WALL STREET JOURNAL.
* *
GREATER NEW YORK
Four Fatally Shot in Brooklyn
Moving Into a New
Apartment? An
App Wants to Help
BY ZOLAN KANNO-YOUNGS
BY JOSH BARBANEL
BEBETO MATTHEWS/ASSOCIATED PRESS
Three men and a toddler
were found shot to death in a
Brooklyn apartment building on
Wednesday morning, the New
York Police Department said.
A 53-year-old woman returned to her Riverdale Osborne
Towers apartment in the
Brownsville neighborhood at
about 5 a.m. to discover her
granddaughter, Laylay Briggs, 1
year old, fatally shot in a bedroom, police said. In the same
room they found the body of the
child’s 27-year-old father, Terrance Briggs, police said.
Officers later found Loyd
Drain III, 16, and his father, Loyd
Drain Jr., 57, dead in other
rooms of the three-bedroom
apartment, NYPD Deputy Chief
Michael Kemper said. All of the
victims were related through
blood or marriage, police said.
A law-enforcement official
said there were “quite a few”
instances of domestic violence
between Terrance Briggs and
his relatives.
“My heart goes out to this
family and to the residents of
Riverdale Towers, to the
Brownsville
community,”
NYPD Assistant Chief Jeffrey
Maddrey said Wednesday during a news briefing. “In the
nature of this business, we
A medical examiner carries the body of a child from an apartment building where four people died.
deal with death and tragic
scenes, but when it involves an
infant, it’s extremely tough.”
Authorities haven’t given a
motive for the shooting. But a
law-enforcement official said
police believe Mr. Briggs shot
the others and killed himself.
The fact that a gun was left
on the scene is consistent with
a murder-suicide, according to
NYPD Deputy Commissioner
Stephen Davis. The apartment
front door was locked, another
indicator of murder-suicide, he
said. “The problem with those
situations is there’s no one
there to tell you what happened,” Mr. Davis said.
Brownsville has experienced
a major decline in crime over
the years, like the rest of the
city. In 1990, there were 60 murders in the 73rd police precinct,
which covers Brownsville, and
26 murders in the precinct in
2001, city crime statistics show.
That number declined to nine in
2017. But the 73rd precinct was
one of only eight precincts with
nine or more murders out of a
total of 77 precincts in New
York City that year.
NICARAGUAN NATIONAL POLICE/AGENCE FRANCE-PRESSE/GETTY IMAGES
GREATER NEW YORK WATCH
Orlando Tercero, shown in custody in Nicaragua, is wanted for
questioning in the death of a Binghamton University student.
CRIME
NJ TRANSIT
Man Sought in Killing Murphy Promises
Is Found in Nicaragua Fares Won’t Rise
A man sought for questioning
in New York in the killing of a
nursing student has been detained in Nicaragua, authorities in
the Central American nation said.
Police in New York say Orlando Tercero, 22 years old, is a
person of interest in the killing
of Haley Anderson, also 22, of
Westbury, on Long Island. The
fellow nursing students at Binghamton University are said to
have had a previous relationship.
Binghamton police found Ms.
Anderson’s body on Friday.
—Associated Press
A day after announcing a
budget that includes increased
funding for the state’s beleaguered transit system, Democratic Gov. Phil Murphy has reassured commuters that fares
won’t be raised in the next year.
Mr. Murphy spoke Wednesday at NJ Transit’s monthly
board meeting. He said some of
the additional money budgeted
for the agency will be used to
hire more personnel and ensure
that a federally mandated safety
system is installed.
—Associated Press
After the exhilaration of
signing a deal on a new apartment comes the panicky next
step: Moving one’s life and belongings, not to mention cable
and internet service, to a new
address.
But when Meg Winslow, a
life-sciences
researcher,
moved to a studio on the West
Side of Manhattan after relocating from California, she
was able to set
PROPERTY up her utilities
and change her
address
by
pressing a few buttons on her
cellphone. “There were a lot of
moving parts to moving here,
and I did not want to lose
track” of anything, she said.
Ms. Winslow used a service
by Updater Inc., a New Yorkbased startup that has raised
nearly $100 million for a service designed to simplify the
experience of relocating.
On Wednesday, New Yorkbased brokerage Citi Habitats
announced it had signed up to
provide Updater to its 900
agents in Manhattan and
Brooklyn, who in turn could
invite as many as 20,000 of
their buyers, sellers and renters to use the app.
Updater, which is listed on
the Australian Securities Exchange, said the Citi Habitats
deal is part of a rapid expansion
of its services. They are available without charge to people
who are moving by invitation
from participating building
owners, managers, brokerage
firms and moving companies.
Updater sent invitations to
15% of people who moved in
the U.S. last year, including 18%
of movers in the fourth quarter, it said. Between 30% and
40% of those invited used it for
their move, the company said.
When a mover responds to an
email invitation, key details of
their move are already filled out.
They can submit a change of address notification to the post office, as well as update accounts
at thousands of businesses, from
magazine publishers to banks
and brokerage firms.
The service is integrated
with many cable companies
and pay-TV services, as well as
electric and gas utilities, allowing people to sign up for
service on the same website.
Last fall, Updater acquired
two software companies serving the moving industry, and
plans to roll out a way for people on the move to select a
moving company from multiple
price quotes.
Gary Malin, the president of
Citi Habitats, said buyers and
renters often turn to brokers
for advice on how to complete
their move. Updater would sim-
$100M
Amount Updater has raised for a
service that helps people relocate.
plify a “pain point” in the process, he said, and help brokers
maintain relationships with
customers after a deal is signed.
“This shows them we are thinking of them, before, during and
after the sale,” he said.
Caroline Bass, a broker at
the Corcoran Group, said she
had used Updater herself, and
integrated it into a series of
automated emails she sends to
clients to maintain relationships and offer future services.
While the service is free to
consumers, brokerage firms
and building operators pay to
be included, said David Greenberg, founder and chief executive of Updater. Updater also
charges fees to cable and moving companies to customize
the moving experience, he said.
An important Chinese underglaze blue teapot and cup. This
exceptio
exceptional
rarity has underglaze blue reign marks of Xianfeng
(1851-1861)
on both teapot and cup. Obviously made in the
(1851Royal ki
kilns, both vessels also have the personal cypher of King
Chulalongkorn of the Royal Siamese Court.
New York Asia Week
March 16th - 23rd, 2018
11 am - 6 pm
Openi
Opening Preview
Ma
March 15th
6 pm - 9 pm
Size: Teapot 7” tall x 6 1/3 diameter
Cup 1 ¾” tall x 3 ½” diameter
Purchased 1976 from Charlotte
Hortsman of Hong Kong.
THE FULLER BUILDING
STREET  SUITE 1125, NE W YORK, NY 10022
41 EAST 57
2 1 2  6 4 4  1 1 0 3 • W W W. T K A S I A N . C O M • I N F O  T K A S I A N . C O M
TH
.
THE WALL STREET JOURNAL.
LIFE&ARTS
Thursday, March 15, 2018 | A13
Is It a Deal or Not?
A Price Comparison
JUSTIN CLEMONS FOR THE WALL STREET JOURNAL
Whether you are getting a
good deal in the duty-free shop
depends in large part on what
you are buying.
A recent informal survey at Dallas-Fort Worth International Airport
showed travelers can grab some
Estée Lauder Advanced Night Repair, for instance, and save big. A
set of two 100 mL bottles cost
$279. Nordstrom’s website lists the
same quantity at $336. J’adore perfume from Dior costs $133 for 40
mL; the same bottle costs $140 at
Macy’s, and you’d pay sales tax on
top of that.
With liquor and watches, a little online shopping can often
yield bigger discounts. A bottle of
Chivas Regal 18 offered at the
duty-free store for $80 is advertised at Total Wine & More, a
chain of 170 stores in 20 states,
for $68. A $3,800 bottle of Remy
Martin Louis X111 Grand Champagne cognac is $3,400 at
Zachy’s in Scarsdale, N.Y. An
Omega Speedmaster chronograph
watch advertised on Omega’s
website for $10,600 is the same
price at the duty-free store, but
is $8,268 at AuthenticWatches.com.
THE MIDDLE SEAT | By Scott McCartney
U.S. Airports Play Catchup
In Duty-Free Shopping
As mall traffic declines, retailers see opportunity in captive travelers and
expand their offerings, following the lead of Dubai, London and others
Grapevine, Texas
HERE’S A LITTLE SECRET about
airport shopping: You don’t have to
hold an international ticket anymore to buy at many duty-free
shops. And another: It actually can
be a pretty good deal.
In the age of online shopping, retailers are finding that airports can
take some of the sting out of declining mall traffic. Travelers have
time to kill and money to spend
when they’re captive inside airport
security. Major airports around the
world, from Singapore to Dubai,
London to Beijing, have essentially
become shopping malls with gates.
And the U.S. is finally starting to
catch up. Just as they have upgraded restaurants and basic amenities like power outlets, U.S. airports
are finding they need to improve
duty-free stores, which have become
a necessity for many world travelers
who routinely stock up on perfume,
cosmetics, alcohol and chocolate
when coming home from trips.
Airports like duty-free shops because they get a cut of the revenue;
luxury-goods makers like the
chance to interact in person with
shoppers; and customers like the
convenience, savings and opportunity for capricious purchases.
Duty free began in Ireland in the
1940s as a way to stimulate spending by waiving taxes for people
who were heading out of the country. It’s grown and liberalized over
the years, and definitions and qualifications vary in different countries. But the basic premise has become as omnipresent for travelers
as neck pillows and bottled water.
Dallas-Fort Worth International
There is some seating on an open,
second level designed for events,
such as tastings, to lure passengers.
The new, two-level duty-free shopping area at Dallas-Fort Worth International
Airport has an open plan. Brands have their own areas, to create a boutique feel.
Airport opened a duty-free mall inside its main international terminal
in December. About the size of a
Walgreens or CVS Pharmacy, the
area isn’t labeled duty free because
that tends to drive away domestic
passengers, who think they don’t
qualify. In fact, U.S. shoppers can
now buy everything except cigarettes and alcohol, and in many locations it’s all tax (aka duty) free even
if you aren’t leaving the country, because of agreements negotiated with
state and local taxing authorities.
Mauricio Gonzalez, who lives near
Mexico City, recently made his second stop at the DFW duty-free store
while on a business trip. He bought
chocolates for himself and perfume
for his wife. “The variety is good,”
he says. “I don’t know if the prices
are good, but the convenience is.”
Name-brand cosmetics and perfumes especially can be cheaper at
the airport, with special packages,
quantities and, for some brands,
unique products. Other items can
be hit and miss.
Among the more unique offerings:
Sculptures by Texas artist James
Surls, including a tabletop flower
bouquet for $7,000 and a giant wallhanging of his flowers for $250,000.
If you need a $2,600 cowboy belt
buckle, this is the place.
Katherine Choi, who lives near
Houston, stocked up on tequila and
chocolates on a recent trip to Seoul
to see family. She and her husband
used the duty-free store so they
wouldn’t have to put the gifts in
their luggage, where they might get
damaged, lost or stolen.
DFW says it removed some seat-
ing areas in Terminal D to make way
for the new store, a move agreed to
by American Airlines, user of the
nearby gates. Taking away seats
means pacing passengers are practically forced to peruse products.
American also agreed to put longhaul international flights at gates
near the store, and the airport put it
in front of the terminal’s busiest TSA
screening checkpoint. “Were we intentional about this? Yes,” says Sean
Donohue, DFW’s chief executive.
Airport customer research
showed a hunger for high-end retail
catering to expense-account business
travelers and vacationers dubbed
“indulgent explorers,” willing to
spend on unique items, especially local brands.
In Asia, it’s not uncommon for
people to fly off on shopping trips
for a wider selection of goods and
cheaper prices. That’s true in the
Caribbean and Mexico, too.
“The ability to shop is very important for some travelers,” says
Bernard Klepach, chief executive
of DFASS Group, the Miami-based
duty-free retailer and onboard
shopping company that operates
the DFW store.
Moët Hennessy, the Paris-based
maker of Champagne and cognac,
has a boutique in the Dallas dutyfree store where it does tastings of
rare editions—a spot of cognac before boarding. The unit of luxurygoods conglomerate LVMH has airport boutiques in Paris, Taiwan,
Hong Kong and Singapore. Dallas is
its first in the Americas, and more
are likely.
“The proliferation which is starting in the U.S. is quite new, and we
are very happy with it and very
proactive,” says Laurent Boidevezi, Moët
Hennessy senior vice
president in Paris.
Mr. Donohue says
DFW’s duty-free sales
were up 47% in January—the store’s first full
month of operation—
compared with the previous year. But the store
is as much about entertainment as revenue. “If
all I wanted to do was
make money, I’d have a
lot of restaurants and
bars here, and convenience stores,” he says.
While online retailing has curtailed some airport retail business,
companies say they are still seeing
growth—stronger than other traditional venues like malls or Main
Streets. Dufry AG, the largest dutyfree airport retailer, posted samestore revenue growth about 8% in
the first nine months of 2017 compared with the same period in
2016. It was Dufry’s strongest performance since 2011.
“You cannot smell perfume online,” says Mr. Klepach, of DFASS.
“It’s the theater of retail. People like
going in and feeling and touching.”
TELEVISION
BY JOHN JURGENSEN
THE NEW RENDITION of “American Idol” is being judged primarily on the ratings and
buzz it generates for
ABC. But can the
show, whose 16thseason premiere
over the weekend
drew 10.3 million
viewers, still
make good on its
mission to catapult singers into
music stardom?
Based on sales by
winners of “Idol” and
other music-competition
shows in recent years, the launch
platform seems shaky. The genre’s
most successful acts, including
Carrie Underwood and Kelly Clarkson (now a judge on NBC’s rival
series “The Voice”), emerged from
the early seasons of “Idol,” when it
had an easier time seizing national attention.
In addition to the
stratospheric ratings
of “Idol,” top contestants rode the
last waves of the
CD era, as well as
the rise of digital
downloads. Apple’s iTunes store
launched in 2003,
the year after “Idol”
debuted on Fox.
“The shift to digital is
something ‘Idol’ benefited
hugely from. Every night they’d release songs to iTunes, and that’s
Please see IDOL page A14
ABC (2)
CAN ‘AMERICAN IDOL’ TURN
WINNERS INTO STARS?
The new season of ‘American Idol’ includes competitors such as Gabbii Jones, left, and judges Lionel Richie, Katy Perry
and Luke Bryan, above.
.
THE WALL STREET JOURNAL.
A14 | Thursday, March 15, 2018
LIFE & ARTS
ART REVIEW
MoMA’s Human Focus
In its latest survey of new photography, the museum examines being in the world—with some powerful results.
Left, Huong Ngo and Hong-An
Truong, detail of ‘The opposite of
looking is not invisibility. The
opposite of yellow is not gold’
(2016). Below left, Adelita HusniBey, ‘The Council’ (2018); below
right, Matthew Connors, ‘Mask in
Reverse’ (2016).
BY RICHARD B. WOODWARD
we intruding on the most private
moment a woman can have? Or has
Ms. Winant touched upon a more
puzzling cultural taboo?
In assembling the work, she was
shocked to find that such imagery
is comparatively rare. She had to
rely as much on analog documents, including feminist books
from the ’70s, as digital ones. An
event vital to everyone who has
ever lived seems to be less photographed than weddings, football
games, or murders.
Huong Ngo and Hong-An Truong
have reproduced prints from family albums for their collaboration
about the immigrant experience,
titled “The opposite of looking is
not invisibility. The opposite of
yellow is not gold” (2016). Their
mothers fled Vietnam for the U.S.
at different times and found themselves categorized as “aliens,” underscored here by texts from congressional testimony. And yet, as
snapshots reveal, the two women
posed in remarkably similar fashion beside big American automo-
biles, suggesting that photography
itself is essential in helping strangers to feel they belong in a place.
The American photographer Paul
Mpagi Sepuya is already widely exhibited and collected. His portraits
and self-portraits explore his identity as a black, gay man within the
tradition of Constructivist collage.
Using mirrors and cloths, he fragments, shrouds, divides and multiplies parts of the body, teasing the
viewer to piece them together.
“Untitled” (2017) presents the
smooth, muscular back of a male
nude, torqued in the style of Michelangelo. Small reproduced photos by William Henry Fox Talbot
and others are incorporated in the
surface. It’s the most accomplished
work of art in the show. No other is
as self-consciously assured about
engaging with the history of art.
Just as highly wrought is “Sin
nombre” (2017-18) by Harold Mendez. This huge (7-by-15-foot) pale
gray image of a boy on horseback
in a forest pool is blown up from a
glass negative that the American
IDOL
‘Being: New Photography 2018’
MoMA, through Aug. 19
Mr. Woodward is an arts critic in
New York.
Judging ‘American Idol’ and Its Stars
The ability for "American Idol" to launch successful music careers was
already waning by the time the show's viewership peaked in season 5.
Winner’s career album sales*
Winner
FROM LEFT: EVERETT COLLECTION; NBC
Continued from page A13
where the instant gratification factored in,” says Nielsen analyst David Bakula.
The iTunes chart was scrutinized as an indicator of voting results that would be revealed on the next episode,
and established artists like
Queen and the Bee Gees received sales bumps when
their songs were covered.
Now music is in an entirely different place. Revenue from streaming services
such as Spotify and Apple
Music surpassed those from
digital downloads around the
time Fox stopped airing
“Idol” in 2016. When Spotify’s Top 50 chart is dominated by hip-hop acts with
upward of 2 million daily
streams, can aspiring pop
stars from TV compete?
This season’s “Idol” winner receives $250,000, plus
a recording contract with
Hollywood Records. Disney,
which owns the record label
as well as ABC, has an incentive to propel winners to
success in both media.
“Idol’s” season premiere
Sunday was down 6% in total
viewers compared with the
artist discovered in Havana.
Not every image here is appropriated. Matthew Connors’s documentary photographs of North Koreans, taken from 2013 to 2016, are
sympathetic portraits of people
who live in an alternative reality.
They’re hard to read. Are they
zombies, as sad as we think? Or do
they take the same small pleasures
from daily life that all of us do?
The mood of Adelita Husni-Bey’s
series “The Council” (2018) is
far from depressive. Asking
alumni of MoMA’s teenage Digital Advisory Board to imagine
a future when traditional functions of museums have been
replaced by collectives, the
Italian artist posed the group
in scenarios and costumes they
devised themselves.
They stand against backdrops or sit around tables, surrounded by handwritten signs
that read “Access to Information” or “No New Building.”
Capturing the spirit of youthful utopians everywhere, “The
Council” celebrates the civic
bonds of activism.
Whether or not the theme
chosen by Ms. Gallun is meant
to invoke “The Family of Man,”
MoMA’s 1955 blockbuster exhibition and book, she has given
“New Photography” needed
heart and energy. The showcase is
still too unwieldy. Four or five artists from around the world would
be ideal. But this is the most promising crop of photographers to appear here in many years.
CLOCKWISE FROM TOP: HUONG NGO AND HONG-AN TRUONG; MATTHEW CONNORS; ADELITA HUSNI-BEY
New York
PHOTOGRAPHS IN contemporary art exhibitions these
days are as likely to be culled
from the internet as they are
to be taken with a camera by
the artists themselves.
This is not a new method for
making art. In the 1970s, Stephen Shore and others filled
galleries and books with images rifled from magazines and
archives. What’s changed is
clickable, electronic access to
the vastness of the picture universe, along with the post-’80s
triumph of ideas-based practice over traditional photography. By recycling or referencing historical material, artists
can address various thorny issues of representation while
also relieving themselves from
the onus of originality.
About one-third of the 85
pieces in the Museum of Modern Art’s “Being: New Photography 2018,” the latest iteration of its annual or biannual
survey of emerging talent, use
“found” photographs as an embedded or the sole element. What’s
refreshing about several of the examples, though, is how emotionally
stirring they are, often more so
than works where the artist originated the images.
Assistant curator Lucy Gallun
has selected 17 artists from eight
countries who, she believes, give
priority to “the subject of humanity or being in the world” from a
range of “lived experiences and
circumstances.”
Carmen Winant is an American
writer and artist with only one
piece here. That’s plenty. “My
Birth” (2018) is a lulu and certain
to attract crowds.
Attached with blue tape to two
facing walls, in a narrow passage
connecting two main galleries, are
more than 2,000 small images of
women in labor or giving birth. Reprinted from many sources, each
one of these intimate, often
graphic scenes—in black-and-white
and color—is the same yet distinct.
Most viewers will feel squeamish and ask themselves why. Are
Ryan Seacrest, Kelly Clarkson, Justin Guarini and Brian
Dunkleman, above, in the first season of ‘American Idol’; Blake
Shelton, right, on ‘Idol’ rival ‘The Voice.’
premiere of its previous season. Its second episode on
Monday was watched by 8.4
million, going head-to-head
with an episode of “The
Voice” that drew 11.7 million.
However, when comparing
the track record of “Idol”
stars to those of “The Voice,”
there isn’t any competition.
Combined sales for all
“Voice” winners and finalists
add up to about 7 million albums—less than a third of
Ms. Underwood’s sales alone.
The accompanying chart
shows ratings for each season of “American Idol” alongside career music sales of
that season’s winner. It
doesn’t include tallies by
other contestants, who in
some cases went on to outsell the season’s winner. They
include season 2 runner-up
Clay Aiken (5.2 million albums), season 5 finalist Chris
Daughtry (9.4 million) and
season 8 runner-up Adam
Lambert (2.3 million).
Average viewers per episode
Season 0 million
Kelly Clarkson
1
Ruben Studdard
2
Fantasia Barrino
3
Carrie Underwood
4
Taylor Hicks
5
Jordin Sparks
6
David Cook
7
Kris Allen
8
Lee DeWyze
9
Scotty McCreery
10
Phillip Phillips
11
Candice Glover
12
67,686 sales
Caleb Johnson
13
30,695
Nick Fradiani
14
Trent Harmon
15
10
20
30
36,279
55,479
*Includes albums and ‘album equivalent units’ (10 track sales equal one album; 1,500 streams
equal one album).
Source: Nielsen
THE WALL STREET JOURNAL.
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | A15
Julia Cumming, Jacob
Faber and Nick Kivlen
of Sunflower Bean
IT’S THE RARE rock band that
arrives fully formed, especially
when its members have yet to
reach their 21st birthdays. But so
it was with Sunflower Bean in
2016 when its debut album, “Human Ceremony,” revealed that the
trio had created a distinct sound
that distilled, rather than copied, a
variety of influences including
New Wave, post-punk, psychedelic
and even a touch of metal music.
The approach of the Brooklynbased band, formed in 2013, was a
pushback against what it was
hearing in the New York music
scene: too much dreamy introspection and a rejection of early rock
maxims.
Aggressive yet melodic, energetic and neurotic, Sunflower
Bean’s “Human Ceremony” features bassist Julia Cumming and
guitarist Nick Kivlen splitting the
lead vocals above a supple rhythmic machine driven by drummer
Jacob Faber. With Mr. Kivlen issuing compact solos that feel like a
call from an old forgotten friend,
the debut album is loose but never
sloppy, catchy without bowing to
pop clichés; and the arrangements
allow for sudden, often drastic
shifts that come across as both a
wink and a prize.
When the trio settled down after extensive touring behind the
album, they discovered they were
tired of playing the kind of music
they had recorded earlier. When
we spoke by phone last week, they
agreed that “Human Ceremony”
had been an honest representation
of where the band had been, but
that they had grown and become
FEEL
SLEEP
WORK
LIVE
MUSIC REVIEW | By Jim Fusilli
Sunflower Bean
Still Blossoms
The young band’s ‘Twentytwo in Blue’ is more than a great album. It’s a
model of how musicians can grow through innovation and risk.
more purposeful. Sunflower Bean’s
new album, “Twentytwo in Blue”
(Mom + Pop), out March 23, is a
reflection of that focus and maturation. And as good as “Human
Ceremony” is, “Twentytwo in
Blue” is better.
It features lean, efficient melodic rock that calls to mind the
mid-’60s music of the Beatles, the
Byrds and the Who; late ’70s and
early ’80s acts like Nick Lowe;
punk’s the Buzzcocks and the Ramones; and New Wave groups
Blondie and the Go-Go’s. That
kind of power-pop rock requires
meticulous, hook-minded songwriting and airtight arrangements
featuring layered guitars that
complement the voices. Minus
any of those traits, power pop can
be squirmy nonsense. When all
are present, it’s undeniably popular music that is instantly memorable and perpetually rejuvenating. A great power-pop album
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that’s decades old, like Cheap
Trick’s debut (1977) or Matthew
Sweet’s “Girlfriend” (1991), still
sounds fresh.
Sunflower Bean’s “Twentytwo in
Blue” is built to last. It announces
its intentions immediately with the
straight-ahead “Burn It,” with Mr.
Kivlen’s guitar snarling under Ms.
Cumming’s voice. A bright acoustic
guitar and Ms. Cumming’s bass tee
up the fetching “I Was a Fool,”
while in “Human For” Mr. Kivlen’s
squealing guitars emerge from a
roar in which Ms. Cumming sings
repeatedly “I need the sound of
the drums.” “Memoria” finds Mr.
Faber’s punchy, understated percussion filling the space between
the bass and a chiming guitar; Ms.
Cumming overdubs her voice to
form a pop choir.
The trio isn’t married to power
rock. “Only a Moment” recalls ’60s
girl groups, while “Any Way You
Like,” sung by Mr. Kivlen, is an update of an old-fashioned stroll.
Kicking off with huge drum beats,
“Puppet Strings” is a battle between Ms. Cumming’s sweet vocal
and Mr. Kivlen’s nasty power
chording. The raw “Sinking Sands”
straddles garage rock and punk
with Mr. Kivlen on vocals, but
when Ms. Cummings sings, the
song turns into merengue-like pop.
WE’RE
BULLISH ON
COMFORT
FREE
“Twentytwo in Blue” refers not
only to the band members’ ages—
they all turn 22 this year—but also
to a state of mind that ripples
through the lyrics. The lives of
three so early in their third decade
have been accelerated by success
that usually comes later, if at all,
to rock and pop musicians: Mr.
Faber spoke of the differences between chronological age and age
as determined by experience. Removed from the blush of youth, on
“Twentytwo in Blue” the trio ponders what it considers a troublesome time, be it in personal relationships or geopolitically.
Ms. Cumming said the album’s
songs are about resilience. “When
things are in shambles, there’s an
opportunity to become stronger,”
she told me. Shifting points of
view within songs reflect what she
said is the result of a process in
which she writes as if telling stories but is in fact engaging in an
internal conversation.
With its unbridled enthusiasm,
clever songwriting and superior
rock musicianship, “Twentytwo in
Blue” is more than a great album.
It’s a model of how a determined
group of young musicians who acknowledge a desire to grow can
do better than they had before.
Thus the still-young Sunflower
Bean is finding a way to build a
career through innovation and
risk. That in itself is an admirable
achievement.
Mr. Fusilli is the Journal’s rock
and pop music critic. Email him at
jfusilli@wsj.com and follow him on
Twitter @wsjrock.
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ANDY DELUCA
LIFE & ARTS
.
THE WALL STREET JOURNAL.
A16 | Thursday, March 15, 2018
SPORTS
NCAA TOURNAMENT
Tiger Woods produced a top club
head speed of 129 mph last week,
the highest by any player on the
PGA Tour this season.
WHY PENN CAN
SHOCK KANSAS
BY ANDREW BEATON
SAM GREENWOOD/GETTY IMAGES
THE FIRST RULE of filling out your NCAA
bracket is to confidently place every No. 1
seed into the second round. It’s the only
blissful moment of filling out your bracket.
Because it’s the only thing you know you’re
going to get right. A No. 1 seed has never
lost in the round of 64.
We’re not here to tell you do something
stupid. But you should definitely think about
doing something stupid: Picking No. 16
Pennsylvania to topple No. 1 Kansas.
The risks are obvious. This has never
happened before. It will likely torpedo your
bracket by mid-afternoon on Thursday. And
the rewards—at least, in your pool—aren’t
actually that great.
But there’s something to be said for the
invaluable pleasure of getting to obnoxiously
repeat, “I told you so,” until March 2019.
Just kidding, if you get this right you’ll never
stop saying that. And this year, your best
chance is picking Penn, because it’s slightly
less insane than picking the normal 16 seed.
Why? It begins with the fact that the
Quakers are far better than your typical No.
16 seed. They’re rated No. 128 in the country, according to KenPom.com, which to be
clear means they’re not very good. But it
also means they should have been seeded
higher: They’re rated higher than one No. 14
seed and three of the four No. 15s. They’re
also ranked higher than any 16 seed in at
least the last five years.
At the same time, Kansas isn’t the prototypical No. 1. The Jayhawks won the Big 12
for their 14th straight season but are still
rated No. 9, per KenPom.com, with all four
No. 2s, a No. 3 and No. 4 above them. They
lost seven games and have struggled on the
defensive end for long stretches this year.
If you need even more reason, the bookworms from the Ivy League have made a habit
of busting brackets lately. Yale, as a No. 12
seed, toppled Baylor in 2016. Before that, Harvard produced back-to-back upsets as 12 and
14 seeds in 2014 and 2013. Last year and in
2015, the Ivy teams came within two points
each of making it five straight upsets.
To be clear, this probably won’t happen.
But it’s also probably likelier than you
think: The chances are at 11%, according
to KenPom, which is far likelier than the
typical 1 vs. 16 game.
GOLF
Tiger Woods Turns Back the Clock
Woods says his body is allowing him to do things he hasn’t done with ease in a long time
BY BRIAN COSTA
CHRIS SZAGOLA/ASSOCIATED PRESS
ORLANDO, Fla.—The parlance of golf nerdery may be Tiger Woods’s favorite language.
Whether delving into spin rates or swing
patterns, this is not an athlete who lacks the
ability or interest to break down his game in
highly technical terms. But when asked how,
after four back surgeries, he managed to produce a top club head speed of 129 mph last
week—the highest by any player on the PGA
Tour this season—he had no explanation.
“Dude, if I knew I would tell you,” Woods
said. “I don’t know. It just…happened.”
Not even Woods fully understands how,
in the span of a few months, he went from
preparing for life after competitive golf to—
as of this week’s Arnold Palmer Invitational—the betting favorite to win a tournament. His back finally healed. That much is
evident. The effect has been dizzying, and
not just in terms of how fast Woods climbed
back into contention.
With a body that for much of the past
three years made it difficult for him to even
pick up a club, Woods has the second-highest average swing speed on tour this season,
at more than 122 mph. That is faster than
Woods swung in 2013, when he won five
tournaments.
At 42 years old, Woods is lashing the ball
like he did more than a decade ago. The
theory he has discussed with people in his
inner circle is that it shows how much he
Penn’s Max Rothschild celebrates after the
Quakers beat Harvard to win the Ivy League.
Weather
40s
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20s
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30s
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Seattle
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Portland
Helena
Eugene
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Buffalo
80s
Anchorage
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Miami
U.S. Forecasts
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.
Tomorrow
Hi Lo W
49 34 r
77 48 s
40 26 pc
73 51 pc
36 20 pc
38 17 c
54 39 c
55 39 sh
47 43 r
53 41 pc
55 44 sh
57 30 s
55 37 pc
37 28 sn
47 29 pc
International
City
Amsterdam
Athens
Baghdad
Bangkok
Beijing
Berlin
Brussels
Buenos Aires
Dubai
Dublin
Edinburgh
Today
Hi Lo W
51 40 c
67 52 s
83 60 pc
91 77 s
54 29 s
43 31 pc
50 41 r
75 49 s
83 68 s
51 42 r
46 38 c
Tomorrow
Hi Lo W
44 25 sh
67 54 c
78 53 pc
91 77 s
47 34 pc
38 21 c
52 29 sh
79 60 pc
87 71 s
50 40 r
43 32 r
City
Frankfurt
Geneva
Havana
Hong Kong
Istanbul
Jakarta
Jerusalem
Johannesburg
London
Madrid
Manila
Melbourne
Mexico City
Milan
Moscow
Mumbai
Paris
Rio de Janeiro
Riyadh
Rome
San Juan
Seoul
Shanghai
Singapore
Sydney
Taipei City
Tokyo
Toronto
Vancouver
Warsaw
Zurich
Today
Hi Lo W
55 42 pc
45 40 r
77 56 s
76 67 c
57 48 pc
89 76 t
64 49 c
82 60 pc
55 45 r
53 40 sh
92 77 s
68 53 c
80 53 pc
50 44 r
31 8 sn
90 77 c
55 44 c
97 82 s
90 68 s
59 53 t
87 72 s
53 38 r
75 47 sh
90 78 pc
88 70 s
79 64 c
67 57 pc
38 20 pc
48 36 s
40 29 c
51 37 r
4
5
6
7
8
9
14
10
15
18
20
11
12
16
22
24
26
Tomorrow
Hi Lo W
52 28 sh
54 38 sh
83 61 s
77 67 pc
59 53 pc
89 76 t
61 45 pc
83 55 s
55 38 sh
52 39 sh
90 78 s
77 62 c
80 52 pc
60 47 s
20 3 c
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91 79 t
88 67 c
61 48 r
87 73 s
52 32 s
53 47 r
91 78 c
78 71 r
79 64 pc
63 41 c
32 21 pc
48 35 c
36 19 c
54 39 pc
27
25
28
31
33
36
38
41
44
49
54
50
55
58
60
51
52
53
56
59
61
62
BEWARE! | By Alice Long
39 Specter
8 Roy Rogers
part
9 Ribs connectors
42 Value system
10 “Straight Up”
singer
43 Unimportant
person
11 2012 Tony
winner for
Best Musical
46 Chief
48 Something at the
end of the line
41 Escape routes,
at times
44 Ocean sound
12 Not natural
13 Clytemnestra’s
mother
26 Candidate to
replace Andrew
Jackson on the
twenty
45 Miniature mount
15 Flash
intermittently
14 Earmarks
31 Worker’s reward
16 Your pick of
17 Utah Valley
University
setting
18 Edible algae
called aosa nori
in Japanese
cooking
32 Like 2017 but
not 2018
33 “Toodles!”
35 Different
36 Litter containers
37 British crown
colony until
1963
20 Coin bearing
a portrait of
Juan Carlos I
38 Drops in the
meadow
22 Sped (along)
39 Stimulates
37 Suspension
40 Princess
Charlotte’s
grandaunt
25 Six-time role for
Myrna
10 Cacao container
36 Its Macao hotel
has 4,001 guest
rooms and suites
7 Sidewalk
square
40 Shares an edge
with
5 The winks, in
tiddlywinks
31 Planting place
34 Lt.’s subordinate
6 Masse de terre
dans la mer
23 Some are
sprayed on
Across
1 Quite smart
30 Duma denials
2 Attendance call
5 Aquafina rival
45
48
29 Keeps busy
4 Happened as
foretold
43
47
28 Country music’s
Travis
3 Time to beware
40
42
57
34
37
39
27 Takes
responsibility
with regard to
Down
1 Hoof sound
30
32
35
46
29
26 Green features
61 Highmaintenance
62 Words of
disbelief found in
the four longest
Across entries
19
21
23
47 Should that be
the case
49 Ticked off
46 Gets the wrong
party, perhaps
19 Glossary entry
51 Drinking spree
50 “Scram!”
21 They deal with
decks
52 Very much alive
54 With
tenderness,
in music
56 Texting while
driving, e.g.
57 Prefix akin to
equi58 Utterly
unpleasant
59 Stylist’s creation
60 Clause negator
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
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Tomorrow
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Hi Lo W Hi Lo W
Anchorage
34 29 pc 38 30 c
Atlanta
65 44 s
70 55 pc
Austin
74 64 pc 86 66 pc
Baltimore
50 28 pc 44 26 pc
Boise
50 37 sh 50 33 c
Boston
43 29 pc 39 24 pc
Burlington
37 24 sf 30 20 sf
Charlotte
66 44 s
69 46 pc
Chicago
43 26 s
40 31 pc
Cleveland
36 23 sf 32 22 pc
Dallas
78 65 pc 86 61 pc
Denver
65 35 pc 59 33 pc
Detroit
38 20 pc 39 25 s
Honolulu
83 72 sh 84 72 pc
Houston
77 66 pc 84 67 c
Indianapolis
49 25 s
45 33 c
Kansas City
69 47 pc 64 39 t
Las Vegas
63 48 pc 64 47 pc
Little Rock
72 52 s
73 55 t
Los Angeles
64 49 pc 59 48 c
Miami
75 57 s
77 59 s
Milwaukee
40 25 s
37 30 pc
Minneapolis
41 21 s
43 27 pc
Nashville
68 45 s
62 54 r
New Orleans
72 58 pc 75 63 t
New York City
46 30 pc 37 28 pc
Oklahoma City
74 55 s
78 46 s
Flurries
Ice
Today
Hi Lo W
57 36 pc
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46 30 pc
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42 25 c
56 39 sh
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embracing other ways to make himself relevant in the golf world.
Now, Els said, “I think he’s getting into
position to maybe play.”
Woods is favored to win this week in part
because of his staggering success at this
tournament. He has won it eight times, including four of his last five times playing in
it, most recently in 2013. There is a downside to those expectations. People who,
about a week ago, were merely glad to see
Woods in any form again will start to scrutinize him more closely. At some point, him
not winning may be viewed as a failure
again. Woods said he implores people to
consider how uncertain it was that he would
even be playing at this point.
But the hype also reflects the reality:
Woods’s body is allowing him to do things
he hasn’t done with ease in a long time.
He is driving the ball an average of just
over 303 yards, which is only tied for 42nd
on Tour but would be his longest-hitting
season since 2006. His approach shots,
short game and putting are all among the
25 best on Tour this year, based on the
strokes gained statistic. Furthermore,
Woods said the absence of pain has allowed
him to be more creative in shaping shots.
“My hands tell me how to shape a golf
shot,” Woods said. “So that’s what I’ve
done—I’ve trusted my hands again. My right
arm and neck aren’t shaking because my
back’s out, my nerve’s out and it’s inflamed.
I don’t have those issues anymore.”
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.
Vancouver
Vancouver
had been compensating for back pain even
before his first surgery in 2014.
“I thought, ‘Oh, I hit that hard,’ and it’s
like slo-mo,” Woods said. “But to me it felt
hard. Now I don’t feel like I’m swinging it
very hard, but it’s producing some incredible speeds, which I’m not against.”
The wider audience that Woods long attracted in his prime has returned at an
equally incredible clip. Final-round coverage
of the Valspar Championship, in which
Woods finished tied for second, on Sunday
was the highest-rated non-major golf broadcast in nearly five years, according to NBC.
The sight of Woods in contention at a
regular PGA Tour stop, where promotional
paint cans were used as tee markers, drew
more viewers than any major championship
in 2017 except the Masters.
“I can confirm he’s back,” Brandt Snedeker said after playing alongside Woods last
weekend. “The roars are back.”
The degree to which even Woods has been
surprised by all this was reflected by a move
that was announced on Tuesday. Woods was
named captain of the U.S. team for the 2019
Presidents Cup, alongside international team
captain Ernie Els. It is an honor typically reserved for players who are, if not retired,
then at least past the point where they are
likely to play in the competition.
That’s where Woods appeared to be last
fall, when he called PGA Tour commissioner
Jay Monahan to express interest in the gig.
He hadn’t given up on a return, but he was
53 Stir-fry staple
24 Days of the
week, e.g.
55 Caesar on TV
Previous Puzzle’s Solution
S H O T
T E C H
G R U E
L E
C G I
N O SW
N O T A
G
A N T E
N O R
E T A S
MO V E
O N E P
N C R
E E S
J
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L
T
E
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O
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E
D
I
A
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A
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O R S O
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P T I M E
K G B
E S E
A I N E R
C T O P I
H EWH O
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | A17
OPINION
March Madness in PA-18
Before divining the meaning of a special election
in a Pennsylvania congressional district
WONDER
that soon will
LAND
cease to exist,
By Daniel
let us pause
Henninger
to consider
America’s obsession with elevating the totally obscure to national
prominence.
In March no more pleasurable habit returns than finding the least probable colleges
in the NCAA basketball tournament. This year’s bracket
lists a first-round game as
“NCCU vs. TXSO.” That would
be North Carolina Central
against Texas Southern, which
made it to the Big Dance by
defeating Arkansas-Pine Bluff
for its league title.
We call them Cinderella
teams. Which brings us to
Pennsylvania state Rep. Rick
Saccone versus the Pittsburgh
chameleon Conor Lamb.
It used to be true that all
politics was local. Why care
about an election in a district
that sprawls horizontally
south of Pittsburgh? Because
now more than ever, every
day in our politics is March
Madness. A political burp at
any level can turn into a national event.
What do the returns in Allegheny County, Pa., mean for
control of Congress? Does
Conor Lamb’s strong showing
in PA-18 mean “Conor Lamb”
should be the future of the
Democratic Party?
Washington’s daily takeover of our heads didn’t start
with the phenomenon called
“Trump.” It began with
“Obama.”
Barack Obama preceded
Donald Trump as our first totally celebrified president.
Both men’s victories were
unique on a virtually unprecedented scale. Mr. Obama was
the first black president. Donald Trump was the first . . .
well, the first “Trump.”
As important, both men became president during the rise
of always-on electronic media
that will no longer recognize
any political reality without
first pulling it through a lens
labeled Obama then or Trump
now. The American presidency
defines everything, including
PA-18.
Donald Trump may think
he is dominating our politics,
but he’s also a role-player. He
is forced to prop up weak local candidates in places like
Alabama or Western Pennsylvania with two-year-old campaign oratory, because the
whole world knows he carried
PA-18 by 20 points. Barack
Obama spent his first term
giving the same campaign
speech everywhere. If he
talked to a kindergarten class,
it somehow always got around
to “the wealthiest” and the
“1%,” or so it seemed.
In its current iteration, the
national “narrative,” which is
what we used to call the conventional wisdom, holds that
Trumpist populism now defines the Republican Party.
But Trumpism’s details look
more like an hourly work in
progress, reflecting their
source.
In fact, the leveling political tides are creating a bigger
problem for Democrats. Democrats are both beneficiaries
and victims of Barack Obama,
whose congenial persona
camouflaged the party’s hardleft turn during his term.
Now they’re forced to produce candidates like Conor
Lamb or Jon Ossoff, who last
year lost the Georgia-6 special congressional election, or
Cory Booker—who seem to
represent pretty much nothing. Or at least nothing resembling the dominant Democratic idea-set produced by
Conor Lamb vs. Rick
Saccone is like the
first bracket of the
NCAA tournament.
Washington, New York, San
Francisco, Hollywood, most
media, late-night comedians
or on any college campus.
The most telling thing
about Conor Lamb’s campaign
wasn’t that he rarely mentioned Donald Trump but that
he disowned Nancy Pelosi.
One could write the history of
the modern Democratic Party
in Mrs. Pelosi’s biography.
She grew up in a Baltimore
political family when that city
defined the party’s gritty,
working-class affiliations. She
migrated to San Francisco,
won a special congressional
election in 1987 and now personifies the ascendant Google
Democrats.
Among the Democrats who
did campaign for Mr. Lamb
was Ohio Rep. Tim Ryan of
nearby Youngstown, who challenged Mrs. Pelosi for minority leader last year. He said
the party’s coastal-created
obsession with race, gender
and the rest of the identitypolitics palette has caused it
to abandon working-class
Democrats from heartland
states like his.
For the short version of
the political and psychological confusions this internal
tension has produced, see Hillary Clinton’s remarks in India explaining why white
women vote. That is the voice
of a Democrat—and she’s far
from alone—who is simply
lost inside the party’s current
progressive “narrative.”
Should Conor Lamb’s impressive performance south
of Pittsburgh worry Paul
Ryan and House Republicans?
Yes. Surviving midterm elections is a beast. In 2010, the
House Democrats of the nowcanonized Barack Obama lost
63 seats.
As noted here previously,
three recent presidents have
minimized their party’s midterm losses or gained seats:
Reagan in ’86 (minus 5); Clinton in a personally tumultuous ’98 (plus 5); and George
W. Bush in ’02 (plus 8). They
had one thing in common: a
strong national economy.
Last month the U.S. added
313,000 jobs. The labor participation rate among black
Americans now equals that of
whites for the first time since
1972.
John F. Kennedy, Democrat, said a rising economic
tide lifts all boats. Today the
Democratic Party’s strategy is
to persuade voters those are
fake jobs. The party’s Conor
Lambs are stuck somewhere
in the middle. He’s not just in
PA-18 anymore. No one is.
Write henninger@wsj.com.
What the GOP Can Learn From Losing
By Karl Rove
O
K, it could have been
worse. Republicans lost
the special election in
Pennsylvania’s 18th Congressional District by 627 votes
out of 228,378 cast in a district with 70,000 more registered Democrats than Republicans. On the other hand,
Donald Trump carried the district by 20 points, and the Republican congressman who resigned last year after a sex
scandal was unopposed in his
last two elections.
Sure, the victorious Democrat, Conor Lamb, was from
central casting. A Marine and
prosecutor, handsome and likable, he said he’d never support Nancy Pelosi. He is personally pro-life, supports
fracking and opposes gun control. It’s a reminder not every
Democrat will admit to being
part of the “resistance.”
The losing Republican,
state Rep. Rick Saccone, ran a
vacuous and stale race. But
Republicans would be fools
simply to blame the outcome
on a lousy candidate and a
bad campaign. Learning from
this defeat is the key to preventing Speaker Pelosi’s return in 2019.
To keep the House, Republicans must do everything better this year on all 236 days
before the midterms. The GOP
cannot assume that the economy and tax reform will carry
them to victory or that enthusiasm will materialize out of
thin air.
Republican candidates must
drive home their own distinctive messages. Running as
Trump 2.0 like Mr. Saccone
did won’t work unless your
opponent is Hillary 2.0. Voters must be shown—in tangible terms—why electing a Republican is better for their
family and country. Otherwise, GOP-leaning voters will
Rick Saccone ran as
Trump 2.0, but his
opponent was far
from Hillary 2.0.
stay home or defect. Count on
more Democrats in red districts to soft-pedal progressive
views and run as Republicanlite by sounding reasonable on
guns, defense, deficits and
values.
Having the biggest war
chest is no guarantee of victory (ask Hillary Clinton and
John Kerry). Still, Republicans
must raise enough money to
be competitive. Mr. Saccone,
who raised just $917,000 to
Mr. Lamb’s $3.9 million, didn’t
do that. Worryingly, by Dec.
31, more than 40 Republican
incumbents had been outraised by their Democratic
challengers.
Republican candidates must
know which voters to target.
Many solid Republicans in
presidential years don’t cast
ballots in midterms, and
many swing independents and
soft Republicans do. Candidates should use microtargeting to communicate efficiently with voters who are
up for grabs.
Counting on the Republican
National Committee or super
PACs to do the heavy lifting is
a bad idea. External groups
can help campaigns cross the
goal line, but the candidates
must get in the red zone by
their own efforts. Candidates
receive the lowest prices for
ad time; outside groups don’t.
Candidates can cut ads speaking to the camera; outside
groups can’t. Candidates are
in charge of what they say,
where they go, and whom
they target; outside groups
can’t coordinate with campaigns, only try to divine
what would be helpful.
To that end, candidates
must build their own ground
game by recruiting, training
and motivating armies of volunteers to narrow the enthusiasm gap Democrats enjoy
because of their intense hatred for President Trump.
Speaking of the president:
He riles up the opposition
more than he energizes his
side. Tracking polls showed
Mr. Saccone ahead before Mr.
Trump’s rally Saturday, then
falling behind as the press
covered the visit. Mr. Lamb
got 80% as many votes as Hillary Clinton did in the district,
while Mr. Saccone got 53% as
many as Mr. Trump.
Team Trump should deploy
the president to raise money
and win primaries for electable candidates. But he should
avoid rallies in the campaign’s
closing months. Mr. Trump
drowns out a candidate’s message and makes the news all
about whatever wild line he
slings into the ether.
Candidate quality will matter more than usual this year,
especially in open contests or
races where a GOP challenger
is taking on a Democratic incumbent. Republican primary
voters have a special responsibility: This is no time to reward
old warhorses because it’s their
turn, or to engage in flights of
fancy by picking fringe figures.
If Republicans want to keep
their congressional majorities,
they must pick the best candidates, give generously and often, and commit significant
personal time and energy.
Victory isn’t assured even
if Republicans do these things,
but defeat is certain if they
don’t.
Mr. Rove helped organize
the political-action committee
American Crossroads and is
the author of “The Triumph of
William McKinley” (Simon &
Schuster, 2015).
Use Blockchain to Hold Assad Accountable
By Mounir Ibrahim
W
hen antigovernment
protests broke out in
the al-Midan neighborhood of Damascus, Syria,
seven years ago, I was there.
As a U.S. diplomat, I was reporting back to Washington
on the unfolding political situation. The streets of al-Midan began to fill around 1
p.m. as Friday prayers concluded and hundreds of worshipers went straight from
their local mosques to the alHassan mosque, a common
protest location.
“The Syrian media lies,
lies, lies,” the crowd thundered in unison, before security forces began beating the
protesters. I saw unconscious
demonstrators lying in pools
of blood. Some in the crowd
were filming with smartphones. The security forces
soon spotted them and headed
right for where I was standing. We ran for our lives. My
heart was pounding as I scurried through the old streets.
I heard gunfire but didn’t stop
to look back.
I learned a valuable lesson
that day: The Syrian regime
does not want anyone documenting
its
systematic
abuses. Documentation is a
serious threat to a regime
that thrives on promulgating
false narratives.
The technology can
prove digital images
are authentic.
More recently, as a U.S.
diplomat to the United Nations, I regularly saw deeply
troubling images presented to
the Security Council from
conflicts in Burma, Syria and
elsewhere. Unfortunately, in
most cases the council
wouldn’t act. Some members
argued that images and videos from the brutal chemical
attacks in Syria in 2013 and
2017 couldn’t be verified, and
therefore the truth of what
happened couldn’t be established. Unfortunately, these
members succeeded in preventing international action
and ensuring that bad actors
can continue violating international norms.
Technological advances now
make it possible to disseminate images and videos around
the world in seconds. Journalists and observers can send
authenticated, encrypted digital media over local cellular
networks or high-speed internet connections. Device sensor
data can verify precisely
where a photo or video was
taken, and the blockchain can
ensure its integrity in perpetuity. All of this information can
be stored securely in the
cloud.
In Syria, civic groups and
international organizations
such as the Syrian American
Medical Society are using
these tools to document
events far worse than anything I witnessed. Their goal is
to highlight and preserve the
truth. Their efforts will make
it harder for the regime to
hide its crimes and more difficult for the international community to ignore them.
The ability to authenticate
the provenance of digital
media could do more than
enable documentation of
atrocities. It could help international efforts to monitor elections, fight fraud, audit supply chains and enforce
anticorruption measures. It
could also provide a defense
against new technology that
lets users manipulate and
doctor videos in a way that
looks real.
Image authentication is not
a silver bullet and won’t prevent conflict from happening,
but it may improve the speed
of the international response
to crises when they occur. It
may also help bring accountability to rogue regimes and
justice for their victims.
Mr. Ibrahim is vice president of strategic initiatives for
Truepic and a former U.S. foreign service officer.
BOOKSHELF | By Martin Peretz
Can There Be
A ‘Decent’ Left?
A Foreign Policy for the Left
By Michael Walzer
(Yale, 198 pages, $30)
M
ichael Walzer, now 83, is the unanointed dean of the
American left. The editor of Dissent magazine for
more than 30 years, he has written a book criticizing
his comrades’ foreign policy and, subtly but unmistakably,
their worldview. He sees both as morally lacking and
advocates something more humane and more engaged.
Mr. Walzer is a leftist not for psychological or emotional
reasons but for moral ones. He believes, a priori, in practicing
human decency: a moral sensibility toward other people and
their existences. He thinks that capitalism’s inequality has
coarsened this sensibility but that capital’s productive capacity
can be harnessed, through political action, to transcend the
capitalist system: to create societies where people can live
more equally and so be more decent to one another. The aim is
democratic socialism, the
means are helping “oppressed
men and women to become
political agents who control
their own lives.”
The danger of this a priori
politics is vanguardism, under
which acolytes of an ideal
believe that the ideal is more
important than how they reach
it. Where Mr. Walzer differs is
that he believes that if the aim is
decency, the means must be decent. This requires departing
from theory and practicing a politics of distinction, “[paying] close
attention to local circumstance and
particular histories” and “[thinking] hard
about the relation of means to ends.”
It also requires a foreign policy of distinctions, of recognizing that people labor under different kinds of oppression that
call for different kinds of responses. And it requires recognizing that local resistance to oppression varies: Sometimes, as in
Cuba, people who speak in the name of the oppressed simply
want to use them as tools for power. Mr. Walzer is an honest
leftist, and he tries to keep his comrades honest, too.
But he isn’t sure whether many of them are. “A Foreign
Policy for the Left” reads like an anguished plea to comrades
who have strayed so far from a politics of distinction and
decency that the author doesn’t know whether they can be
brought back. According to Mr. Walzer, the left’s vanguardism
has put it in bed with dictators, fanatics and activists who
reject reasoned debate as a means to democratic change.
This is most obvious to Mr. Walzer in foreign policy,
because it’s so extreme. He gives many examples: leftists’
unwillingness to engage with unionist and feminist allies in
Afghanistan and Iraq because American intervention as a force
for good didn’t fit their theory of America as a force for evil;
their mischaracterization of America’s world reach as
totalistic, which allows blame always to ricochet back to us;
their lumping in of Israel with despotic and imperialist
regimes, ignoring the unique historical situation in which this
encircled democracy finds itself; their attraction to thinkers
like Judith Butler and Noam Chomsky and Slavoj Zizek—the
last of whom preaches, Lenin-like, violence by the few in the
name of change.
The editor of Dissent magazine asks his
comrades for a more nuanced moral
response to America’s use of power abroad.
Mr. Walzer also sees the vanguard impulse at work domestically. He finds, in the aftermath of 9/11, American leftists
opposed to America. They equate American soldiers’ accidental killing of civilians in Afghanistan with terrorist actions,
which “denies one of the most basic and best understood
moral distinctions: between premeditated murder and unintended killing.” From these observations, Mr. Walzer poses a
searing question: “Can there be a decent left in a superpower?” The alternative is that “the guilt produced by living in
such a country and enjoying its privileges makes it impossible
to sustain a decent (intelligent, responsible, morally nuanced)
politics. Maybe festering resentment, ingrown anger, and selfhate are the inevitable result of the long years spent in fruitless opposition to the global reach of American power.”
I suspect that Mr. Walzer takes the latter view, but I have a
different explanation for the left’s indecency, one that begins
with my old teacher Herbert Marcuse, the chief intellectual
influence behind the New Left of the 1960s. Marcuse was
interested in Freud: He cared about psychology and the way
capitalism affected it. Writing about America in the 1950s and
’60s, he saw a society where, to make money or gain a following, you had to stimulate people to buy what you were selling
through stimulating their desires: a contract of narcissism. To
break this contract and touch reality, Marcuse urged his
followers to practice varieties of extreme experience, and the
New Left listened: exploring sexual experimentation, violence,
anything to break out of the system. Suddenly the leftists
weren’t ascetics anymore; they were hedonists.
In my view, Marcuse’s, not Mr. Walzer’s, politics became the
dominant left politics for an obvious reason: His solution to
the problem of a narcissistic society was psychologically
satisfying to narcissists. Marcuse makes leftism another
consumer activity, another way for the ego to satisfy itself:
Being in the vanguard gives social superiority, satisfying that
most dangerous product of a commercial society—amourpropre. And when pressed, vocal leftists give this explanation
for why other viewpoints are not worthy of attention: Reason,
they say, is a scrim for forces that want to oppress them—their
identities, their economic interests, their self-regard. So words
no longer matter, only actions.
Not all leftists are narcissists: I know people who hold
leftist beliefs who are sincerely committed to moral sympathy
and distinctions. But the fundamental question is whether, in
this culture, a movement that starts with a totalizing critique
of “the way things are” can attract political actors who want to
work carefully to make change. I fear such a movement will
instead attract narcissists who want to assert their individual
wills against what they see as a monolithic, oppressive status
quo, using the oppressed as tools for that end. Certainly the
evidence of the ’60s does not leave me optimistic and in fact
explains much about the gap between Mr. Walzer’s generation
of leftists, who grew up in a pre-consumerist society, and the
people who came of age under Marcuse and after. The last
thing I see from the contemporary American left, on matters
abroad or at home, is the politics of sympathy or distinction.
Mr. Peretz was from 1974 through 2011 the editor in chief of
the New Republic.
.
THE WALL STREET JOURNAL.
A18 | Thursday, March 15, 2018
OPINION
E
REVIEW & OUTLOOK
LETTERS TO THE EDITOR
Kudlow Into the Breach
A Tunnel Vision Essential for Infrastructure
quity markets stumbled Wednesday af- fell on fear of lost foreign sales, down 2.5% on
ter President Trump tweeted his enthu- the day.
siasm for more trade brinksmanship
The Commerce Department then signaled
even as first quarter economic
that it will allow few product
Trump needs his new
growth estimates are falling.
exceptions to the tariffs for
Congratulations and good
metal-using firms. This
economic chief’s focus U.S.
luck, Larry Kudlow, who said
means higher prices for evon policies for growth. erything from the aluminum
he has accepted Mr. Trump’s
offer to run the White House
foil around Hershey’s Kisses
National Economic Council.
to the steel in Ford Motor’s
The long-time CNBC commentator is an ex- profitable SUVs. German Chancellor Angela
cellent choice to replace Gary Cohn, having Merkel said the European Union shouldn’t fear
helped Mr. Trump craft his campaign tax plan. retaliating if necessary. And news reports said
Mr. Kudlow, a stalwart from the GOP’s growth Mr. Trump asked advisers to double the tariffs
wing going back to the Reagan Administration, he is soon expected to impose on Chinese
also played a crucial role persuading Congress goods to $60 billion.
to support the reform that passed in December.
All of this interferes with the economy’s
He spent hours with Senators making the case growth momentum of the last nine months. Mr.
for the supply-side benefits of tax reform, which Kudlow has devoted his career to promoting
passed without a single Democratic vote.
policies that produce prosperity, including tax
Mr. Kudlow’s job in the White House will be cuts, deregulation, privatization and open trade.
to protect this growth potential against policy At some level Mr. Trump must recognize and
erosion. This includes new bursts of spending, want this, and it doesn’t hurt that Mr. Kudlow
special pleading by industries, and above all a is the kind of seasoned TV advocate Mr. Trump
wave of trade protectionism. Mr. Kudlow has respects.
been critical of Mr. Trump’s steel and aluminum
Mr. Kudlow is less of a brawler than Mr. Cohn,
tariffs, but the President has spoken with him so one question will be how such a nice guy will
several times in recent days and presumably is fare in the Trump Hall of Knives. Aside from the
comfortable with an internal debate.
protectionists, he’ll have to compete for influ“We don’t agree on everything, but in this ence with Treasury Secretary Steven Mnuchin,
case I think that’s good,” Mr. Trump said on who wants weaker capital standards for banks
Tuesday. “I want to have different opinions. We and doesn’t seem to mind a weaker dollar.
agree on most. He now has come around to beBut Mr. Kudlow will have allies in White
lieving in tariffs as a negotiating point.”
House economist Kevin Hassett and budget diThe risks of this strategy were clear Wednes- rector Mick Mulvaney, as well as the first-rate
day when share markets fell amid new trade ten- staff that Mr. Cohn assembled, if he can keep
sions. Mr. Trump started the selloff with a them. Mr. Kudlow also has allies on Capitol Hill.
morning tweet that said, “We cannot keep a His best asset is that Mr. Trump needs faster
blind eye to the rampant unfair trade practices growth and rising wages to succeed, and that
against our Country!” Boeing shares promptly has been Mr. Kudlow’s life’s work.
T
Trump’s Pennsylvania Downdraft
he Republican hold on Congress grew coal miners’ pensions. Most Democrats will neumore tenuous Tuesday with Democrat tralize the trade issue in November by embracConor Lamb’s apparent victory in a spe- ing Mr. Trump’s tariffs, even as the border taxes
cial election in the heart of
pose risks to the economy.
Steel tariffs failed to
Trump country. The GOP will
Mr. Trump and the GOP
need a better strategy in No- save the day in a special tried to nationalize the race by
vember than imposing tariffs
sending the President into the
election for Congress. district on Saturday and linkand donning Nancy Pelosi
fright masks.
ing Mr. Lamb to the return of
Donald Trump won PennMs. Pelosi as House Speaker.
sylvania’s 18th Congressional district by nearly But Mr. Lamb never took the bait, saying that
20 points in 2016, but Hillary Clinton isn’t on the “I’m not running against President Trump, and
ballot anymore. The Democrats nominated a people in my district are not looking for somebetter candidate in Mr. Lamb, a 33-year-old for- one running against Mr. Trump.” He also prommer Marine who toned down the anti-Trump re- ised not to support Ms. Pelosi as Democratic
sistance rap and embraced familiar demagogu- leader and opposed new restrictions on gun
ery linking tax cuts to cuts to Medicare and ownership.
Social Security.
Mr. Lamb could afford to soft-sell opposition
While some absentee votes remain to be to Mr. Trump because he knows Democrats are
counted, Mr. Lamb’s lead over Republican legis- itching to vote against the President in any case.
lator Rick Saccone will be hard to overcome. But Like Republicans against Barack Obama in 2010,
even if Mr. Lamb were to lose in the end, the Democrats will “crawl over broken glass” to
race’s dynamics and turnout are a bad portent demonstrate their opposition, as Texas Senator
for the GOP in November.
Ted Cruz recently put it. An anti-Trump wave
The most important fact is that Democrats is building that could take out the GOP House
came out in droves while the GOP vote collapsed. and even Senate majorities.
Republican candidates in the district typically
Republicans are touting their tax reform and
get well over 150,000 votes but Mr. Saccone won the strong economy as a cure-all, but tariffs
only about 113,000. Mr. Lamb received nearly muddy the message and they didn’t sell the tax
114,000 votes, winning a larger percentage of the cuts well in Pennsylvania. They also let Mr. Lamb
electorate than any Democratic candidate in the blame them for cuts to Medicare and Social Sedistrict since 2000. This continues the trend in curity that they don’t have the nerve to vote for.
special elections and in the Virginia Governor’s It’s quite a feat to lose for something you have
race last year that Democrats are highly moti- no intention of doing.
vated while Republicans are less enthused.
Republicans in Congress seem prepared to
If Mr. Trump thought his steel and aluminum rest on their tax cut success from last year and
tariffs would save the day, he needs better politi- coast for the rest of the year. Maybe they should
cal advice. Mr. Lamb endorsed the tariffs, as well press some issues that might give voters a reaas natural gas drilling and federal guarantees for son to keep them in the majority.
C
A Cancer Scare Defeat in California
ancer is a scary disease, but Californians
have been determined to scare themselves more than most with warnings
about the supposedly cancer-causing material
in everything from shoes to cat litter. Now a federal judge says these mandatory fright signs may
violate the First Amendment when not backed
by accurate science.
Judge William Shubb issued a preliminary injunction two weeks ago blocking California from
compelling businesses to issue warnings about
a chemical known as glyphosate. Farm groups
and businesses sued after the state required new
cancer warnings on food products that contain
wheat, corn, soybeans and other crops exposed
to the common herbicide.
The Environmental Protection Agency has
deemed that glyphosate is safe, and California’s
Office on Environmental Health Hazard Assessment also found it “unlikely to pose a cancer
hazard to humans.” But under the 1986 state
Safe Drinking Water and Toxic Enforcement Act,
also known as Prop. 65, California defers to the
World Health Organization’s International
Agency for Research on Cancer. In 2015 the
France-based United Nations outfit claimed glyphosate is “probably carcinogenic.”
Reuters later revealed that the U.N. agency ignored substantial evidence showing no link between glyphosate and cancer. One adviser to the
agency, Christopher Portier, worked on the glyphosate decision even as he received pay from
Lundy & Lundy, a law firm that brings cancer-related class-action lawsuits, according to a deposition in a different lawsuit.
The U.N. outfit is notorious for bad science.
The group has assessed 1,067 products and ruled
only once that a substance was “probably not
carcinogenic to humans.” The group’s list of can-
cer risks includes eating red meat, french fries
or “pickled vegetables (traditional Asian),”
drinking “very hot beverages,” using fluorescent
lights, working the late shift, having your dentist
fill a cavity, getting your hair colored, and using
aloe, talc or Tylenol.
Businesses can’t appeal and the U.N. group’s
glyphosate comments automatically triggered
an entry on California’s carcinogens list. California then set a “safe harbor" level for trace
amounts of glyphosate, and the cancer warning
is mandatory for anything above that.
This means businesses have an incentive to
put a warning label on any product even possibly
exposed to glyphosate, given that trial lawyers
can bring class-action suits that cost up to
$2,500 per violation per day. But if businesses
include the cancer warnings on grocery staples
like Cheerios or bread, they risk damaging their
brands. That risk can be nationwide, given how
difficult it would be for farmers to create a distinct supply chain or label only those crops destined for California.
Judge Shubb agreed with the plaintiffs that California can’t legally compel “false, misleading and
highly controversial statements about their products” based on faulty conclusions about glyphosate. He said the government can compel businesses to make some disclosures if they are “purely
factual and uncontroversial information.”
But assertions that glyphosate causes cancer
are “misleading at best,” the judge wrote. “Providing false or misleading labels to consumers
also undermines California’s interest in accurately informing its citizens of health risks at the
expense of plaintiffs’ First Amendment rights.”
No word on whether California will appeal, but
meantime count this a victory for common sense
and the rule of law.
Rep. Ted Budd’s “The Northeast’s
Costly Tunnel Vision” (op-ed, March
8) offers readers a shortsighted view
of commerce and trade in this country. Rep. Budd’s commentary ignores
that the Hudson Tunnel Project proposal is a crucial infrastructure project for the entire nation. It is not a
project benefiting only New York and
New Jersey, as suggested by Rep.
Budd, but a critical link in America’s
infrastructure and economy. Nineteen states, including North Carolina,
realize the benefits of the shipment
of passengers and freight up and
down the Northeast Corridor (NEC)
rail line.
Rep. Budd questions why two socalled “wealthy states” like New York
and New Jersey cannot pay more toward the Gateway Program. But the
NEC is a federal asset. The offers of
Albany and Trenton to foot as much
as half the bill are generous, not paltry. If that isn’t “skin in the game,”
then what is?
Garden State taxpayers have long
been paying more than their fair
share to fund transportation projects
around the country. New Jersey, for
example, receives 74 cents for every
tax dollar it sends to Washington,
D.C. Rep. Budd’s home state of North
Carolina received $1.41 from Washington for every $1 paid in federal
taxes in 2015—the fourth highest return of the 50 states.
I support merit-based infrastructure projects around the country. I
don’t question the importance of national infrastructure projects in other
parts of the U.S. simply because they
are not in my backyard. This Nimby
point of view is poor public policy.
REP. LEONARD LANCE (R., N.J.)
Flemington, N.J.
If Rep. Budd really believes that
major infrastructure projects like
Gateway should be funded at the
state level, he should fight to end the
massive redistribution of money
from New York to other parts of the
country.
DEVIN GOULD
New York
Franchisers, Responsibility, Workers Rights
Regarding Andy Puzder’s “A Bad
Obama Labor Rule, Resurrected” (oped, March 2): The reinstatement of
the National Labor Relations Board’s
“joint employer” standard is a welcome respite from the Trump administration’s relentless assault on lowwage workers. The standard is
essential for establishing who workers are able to bargain with and for
holding companies appropriately accountable for instances in which they
share control over illegal working
conditions.
Today, companies, as part of a nostone-left-unturned search to meet
quarterly earnings targets, increasingly turn to their workforce as a
place to cut costs. Across industry,
firms outsource critical business functions—think airplane baggage handlers and hotel housekeepers—rather
than making long-term-minded investments in direct employees. For
commoditized, subcontracted workers, violations of federal labor law are
rampant; it is not uncommon for subcontracted workers to be paid weeks
late, to be uncompensated for over-
time and to work in unsafe conditions. But because these workers
aren’t actually direct employees of
the companies which benefit from
their labor, corporations can keep
them at arms length, essentially buffering themselves from responsibility
or liability.
Narrowing the definition of joint
employment as attempted by the
Trump NLRB would accelerate this
trend. The Save Local Business Act, a
bill currently before Congress, would
go even further in the wrong direction by redefining joint employment
not only for purposes of collective
bargaining but also by attacking more
fundamental labor standards like minimum wage and overtime pay. It
would make it virtually impossible to
define an entity as a “joint employer,”
thereby making it even more desirable for large companies to outsource
their labor costs. That may be good
news for some, but low-wage workers,
who haven’t seen a raise in real dollars in nearly 40 years, can’t afford it.
SEN. CORY BOOKER (D., N.J.)
Newark, N.J.
A Few Philosophers but Lots of Electricians
Good mechanics are in short supply, especially good ones who specialize in diesels (“Trade School Wins
Fans Among Teens,” U.S. News,
March 6). If you decide to enter the
trade you’ll find yourself in a challenging, demanding (both physically
and mentally) and ultimately, extremely rewarding career. Additionally you’ll be well compensated. In
our shop, journeymen make $45 an
hour, time-and-a-half after eight
hours and double time after 16 hours
and on Sunday, along with a premium
benefits package. It’s often hard,
dirty work, but after doing this for
nearly 50 years, I still look forward to
going to work each day, which is
something not many people can say.
MARK ZIMMERMAN
Danbury, Conn.
grees in Automotive Technology and
Management after a two-year program right after high school. After
five years at their respective jobs,
which both thoroughly employ their
respective educations, guess which
one makes more money? Trade
school wins.
BRONWYN CLEAR
Houston
It is absolutely true that some
graduates of trade schools earn more
dollars per hour after graduation
than many liberal-arts majors achieve
after years of study.
I graduated from the University of
Chicago with a degree in animal-behavior studies and did further graduate work at Duke, after which I decided to open a music store
specializing in vintage stringed inWe have one son who graduated
struments. While I don’t directly use
from MIT with a Ph.D. in organic
the technical knowledge I picked up
chemistry after a total of nine years
in college and graduate school, the
of college. We have another son who
basic techniques and analytical prograduated from WyoTech with decesses learned in the course of my
education are skills I put to use every
day in business managing 25 employees servicing clients world-wide.
Some tradesmen such as electricians, building contractors and speAfter Kevin Warsh makes a concialized construction craftsmen,
vincing case that flawed government
plumbers and guitar-repair technipolicies have contributed to cryptocians have skills that provide an excurrency’s rapid rise in price, he inex- cellent income and are unlikely to beplicably suggests that the Federal Recome obsolete in the coming century.
serve introduce its own digital
Unfortunately, diesel mechanics is a
currency (“The Meaning of Bitcoin’s
field that is likely to be obsolete
Volatility,” op-ed, March 8).
within the coming 10 years. There is
Such a move would be harmful on
virtually no crossover in diesel-memany levels. It could crowd out innova- chanics skills to the electric vehicles
tive private cryptocurrencies that will
that will dominate the roads in the
improve the processing and remitting
near future.
of payments. It could signal inflationGEORGE GRUHN
Nashville, Tenn.
ary moves by the government, even if
this isn’t the Fed’s intention. And it
could create a new speculative bubble,
as investors rush to buy currency they
perceive as officially sanctioned and
backed by the federal government.
The U.S. government issuing its
THE WALL STREET JOURNAL
own cryptocurrency would likely not
be seen as a sign of stability, but as a
desperate measure to prop up poor
policies. Only the fierce discipline of
the price-discovery mechanism of the
private market can curb cryptocurrency’s volatility while harnessing its
innovations.
JOHN BERLAU
Competitive Enterprise Institute
Washington
Cryptocurrency: Does Fed
Want to Imitate Venezuela?
Pepper ...
And Salt
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“I am dressed for the job I want.”
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THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | A19
OPINION
The Pyongyang-Tehran Axis
By Richard Goldberg
And Mark Dubowitz
Fixing or scrapping the
Iran nuclear deal is the
best thing Trump can do to
denuclearize North Korea.
Iran and North Korea both began
their pursuit by acquiring designs and
materials from Pakistan’s infamous
A.Q. Khan proliferation network. Reports of more extensive cooperation
haven’t been confirmed: Iran reportedly sent its nuclear chief, Mohsen
Fakhrizadeh, to a North Korean nuclear test in 2013. Last summer North
Korea’s second-highest-ranking official reportedly visited Iran for 10 days.
In early 2015, Defense Secretary Ash
Carter said Pyongyang and Tehran
AFP/GETTY IMAGES; BEHROUZ MEHRI/AFP/GETTY IMAGES
D
efying precedent and conventional wisdom, President Trump says he’ll
meet in May with North
Korean dictator Kim Jong
Un. Mr. Trump wants a sustainable
deal that leads to North Korean denuclearization. The president’s critics
scoff, and even his supporters are
rightly skeptical. But Mr. Trump has
conditions: His policy of maximum
sanctions pressure will remain in
place, Pyongyang must commit to the
goal of denuclearization upfront, and
it must refrain from missile or nuclear tests during talks. That may
give him some leverage.
But if there’s one thing that would
help Mr. Trump to succeed, it’s fixing
the fatally flawed nuclear deal with
Iran. The Iran-North Korea axis dates
back more than 30 years. The two regimes have exchanged nuclear expertise, cooperated widely on missile
technologies, and run similar playbooks against Western negotiators.
The fear: Tehran is using Pyongyang
for work no longer permitted under
the 2015 nuclear deal while perfecting North Korean-derived missile delivery systems back home.
North Korea’s Kim Jong Un and Iran’s Ayatollah Ali Khamenei.
could be cooperating to develop a nuclear weapon.
Missile cooperation is extensive.
Iran’s Shahab-3 nuclear-capable ballistic missile, whose 800-mile range
means it can hit Israel, is based on
North Korea’s Nodong missile. The
1,200-mile-range Khorramshahr missile, which Iran showed off last year,
was derived from North Korea’s
BM-25
For years Iran watched Pyongyang
play the Clinton, Bush and Obama administrations to advance its nuclear
and missile programs. The Kim regime demonstrated how a relatively
weak country could persuade the U.S.
to yield on major concessions along
a patient pathway to nuclear weapons and intercontinental ballistic
missiles.
The Islamic Republic followed
North Korea’s lead when it negotiated
the enrichment of uranium and potential reprocessing of plutonium on
its own soil, crossing what for years
had been an international red line. In
exchange for short-lived restrictions
on its nuclear program, missiles and
conventional arms, Tehran will soon
have industrial-size capabilities to
enrich uranium and possibly reprocess plutonium for atomic weapons,
nuclear-capable missiles, and hundreds of billions of dollars in sanctions relief.
Mr. Trump appears determined to
regain American leverage. On Jan. 12,
he declared that he would reinstate
the most powerful economic sanctions
against Iran by May 12 unless Europe
agrees to join the U.S. in fixing the
Joint Comprehensive Plan of Action.
His demands: Eliminate the deal’s sunset provisions, constrain Iran’s nuclear-capable missile program, and demand intrusive inspections of Iranian
military sites. All of these conditions
would be tied to a snap-back of powerful U.S. and European Union sanctions
if Iran was found in breach.
To date the Europeans have refused to budge, especially on the sunset provisions, perhaps not believing
Mr. Trump will leave the deal. They
are adamant that nothing must be
done to jeopardize the JCPOA, which
they see as an important foreign-policy accomplishment—not to mention
a lucrative one, with billions of dollars of potential Iranian business for
their companies.
If Mr. Trump caves in to European
pressure on the sunset provisions,
the agreement will grant Iran a legitimate nuclear program with weapons
capability within a decade. In that
case, the president will be hardpressed to get North Korea to agree to
permanent denuclearization. If he
agrees to let Iran keep testing nuclearcapable missiles that threaten Bahrain, Saudi Arabia, the United Arab
Emirates or Israel, North Korea will
expect the right to test nuclear-capable missiles to hit South Korea, Japan
and Guam. If he buckles on an Iranian
nuclear breakout time of less than one
year or on the development of advanced centrifuges that enable an easier clandestine nuclear sneak out, he
will signal to Pyongyang that it, too,
can withstand American pressure.
Then Pyongyang can resume its march
to nuclear-tipped missiles that hold
America and its allies hostage.
Former Obama-administration officials warn that if Mr. Trump abandons
their Iran nuclear deal, North Korea
will view the U.S. as an untrustworthy
partner. The opposite is true. The
North Korean dictator wants to talk
because the Trump administration’s
campaign of maximum economic
sanctions pressure is working.
But if the president agrees to a fictional fix to the JCPOA, or if he responds to a stalemate by backing
down from the threat to reimpose
maximum economic sanctions, North
Korea will see Mr. Trump as a paper
tiger. Conversely, if North Korea sees
that Iran is held to tough nuclear and
missile standards, backed by the
credible threat of crippling sanctions,
Mr. Trump will be better positioned
to make it clear to Pyongyang that he
means business.
The path to a denuclearized Korean
Peninsula thus runs through Tehran.
If Mr. Trump fixes the fatal flaws of
the Iran deal, or even if he scraps it
because the Europeans balk, his highstakes North Korean gamble may yet
succeed. Even if it doesn’t, he’ll have
stopped Iran from following North
Korea’s path to nuclear weapons and
the missiles to deliver them.
D
ear President Trump:
It seems you are about to
impose tariffs on imported
steel and aluminum. You probably
know that just about every economist except Peter Navarro thinks
this is a terrible idea. But it’s not
just us economists. Aside from the
steel and aluminum industries, virtually the entire business community
opposes the tariffs. The stock market
took a major hit. And by the way,
when did you stop using the Dow to
keep score?
You tweeted that “trade wars are
good, and easy to win.” Actually,
trade wars are bad, and impossible
to win.
Voluntary trade is a win-win proposition, as Adam Smith explained in
“The Wealth of Nations.” Impeding
voluntary trade is a lose-lose proposition. The key word here is “voluntary.” When foreigners rent rooms in
your Washington hotel, both you and
they win, right? If not, why would
they stay there, and why would you
accept them as guests?
Next, let’s consider your “easy to
win” quip. It is likely that the U.S.
can inflict more pain on its trading
partners than they can inflict on us,
as we rely less on trade than most
countries do. Sure. But merely suffering less than your opponent
seems a poor definition of “winning.” Trade wars are a pyrrhic form
of competition in which even the
victor is left worse off.
You say America loses whenever
it runs a trade deficit with any country. But in 2017 the U.S. ran a $571
billion trade deficit with the entire
world, which necessarily included
deficits with dozens of individual
countries. Were they all beating us—
and if so, at what? The truth is that
America’s huge multilateral trade
deficit is made at home.
Here’s why. Nations that invest
more than they save must borrow the
difference from abroad. Happily, the
U.S. can do that because foreign
countries have confidence in American securities. When we import more
than we export, foreigners get IOUs
in return for goods and services
Americans want. That sounds more
First it’s steel beams, then
Jim Beam, then Beemers.
Remember that tariffs
are effectively taxes.
like winning than losing: We get German cars, French wines, and Chinese
solar panels, while the Germans,
French and Chinese get paper assets.
America’s tremendous ability to export IOUs has been called our “exorbitant privilege.” Yes, privilege.
Trade wars have a way of intensifying. Almost immediately after you
announced your tariffs, the European Union warned that it would
slap penalties on American bourbon—a move likely intended to grab
the attention of Senate Majority
By Christina Hoff Sommers
W
Portland, Ore.
hen I arrived at Lewis &
Clark Law School to give a
talk, a security officer asked
if I had a gun. She’d heard rumors on
social media. I didn’t, but my friend
Andy Ngo, a Portland State grad student, was armed with an iPhone.
A letter from several leftist student groups had demanded the Federalist Society disinvite me. It described
Matthew J. Murray
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me as a “known fascist” whose
speech would constitute “violence”
against victims of “gendered oppression.” I didn’t take the letter too seriously, nor did my hosts. Law-school
students are usually older and more
sensible than undergrads, and they’re
supposedly learning how to argue for
a living. Most Lewis & Clark students—progressives and conservatives—are easygoing and committed
to free expression. But that didn’t
stop the bullying minority from turning up the volume.
As we approached the lecture
hall, we saw protesters blocking the
entrance, so we walked in through
an adjacent door. When I reached
the podium, several sign-wielding
students dashed to the front of the
room. The ringleader, a blond
woman in a “Stay Woke” jacket, read
chants from her phone: “Microaggressions are real!” “Black lives matter!” “The gender gage rap is real!”
I think she meant “wage gap.”
About a dozen women and two
men repeated the slogans, sounding
more rote than woke. They faltered
while trying to sing a ditty called
“No Platform for Fascists.” When
one started playing loud recorded
music, the dean of diversity and inclusion, Janet Steverson, seized the
Bluetooth speaker.
The demonstrators were ridiculous, but they got their way. Ms.
Steverson gave up, cut my speech
short, and urged me to start taking
I
am in my 10th year as president of the American Enterprise
Institute. This week I asked
AEI’s board of trustees to begin,
over the coming year, a search for
my successor.
Why? AEI is flourishing, and I’m
still having a wonderful time. But
succession plans work best precisely
when an organization is at maximum
strength. And I believe social enterprises generally thrive best when
chief executives don’t stay much longer than a decade, because it’s important to refresh the organizational
vision periodically and avoid becoming uniquely associated with one
person. I have seen ample evidence
at other nonprofits to support this
proposition, and I’m not willing to
see if AEI can be an outlier.
Remember Gresham’s law,
‘Bad money drives out
good.’ Something similar
is happening with ideas.
questions. At first I resisted. This
was supposed to be a lecture, not a
deposition. But she was adamant.
She seemed like a middle-school
principal trying to restore order
during a playground brawl—but
these were law students in a classroom.
After a reasonably sane Q&A with
the nonprotesters, Andy and I were
escorted out a back door into a campus police car. Andy began releasing
his footage on Twitter and Facebook.
After four days of bad publicity,
Lewis & Clark released a statement:
“On March 5, Christina Hoff Sommers was disrupted by a few protestors at the beginning of her speech.
After a few minutes, she was able to
continue and students engaged in a
vigorous discussion.”
In fact, it was more than a dozen,
the interruptions were constant, and
I wasn’t able to finish my lecture.
The statement did affirm the school’s
commitment to free speech and
promise “appropriate disciplinary action” against the disrupters.
Next Wednesday my colleague
Charles Murray is to speak at a Federalist Society event at Florida’s
University of Miami. There is already talk of protests. My advice to
the law students: Be civil. Andy may
show up, and if so, he’ll be packing
his iPhone.
Ms. Sommers is a resident scholar
at the American Enterprise Institute.
Mr. Brooks is president of the
American Enterprise Institute.
Mr. Goldberg is a senior adviser
and Mr. Dubowitz chief executive at
the Foundation for Defense of
Democracies.
key ally against North Korea and its
nuclear threat. You may have
granted Canada a temporary exemption, but do you really want to poke
these allies in the eye?
Finally, remember that tariffs are
effectively taxes. Industries that consume steel employ far more people
than those that produce it, so a government-mandated increase in steel
prices is almost certain to kill many
more jobs than it creates. What’s
more, many of those lost jobs will be
in manufacturing and other industries that are popular among your
own Republican Party base.
If you thought the prospect of
punishing China was worth all of
these consequences, you should
know that you missed your best
chance. The Trans-Pacific Partnership could have included the U.S.
while leaving China out in the cold.
Yet you pulled the U.S. out, leaving
an open playing field for China to
dominate trade in the region. Has
President Xi thanked you enough for
that?
Mr. Blinder is a professor of economics and public affairs at Princeton University and a former vice
chairman of the Federal Reserve.
‘The Gender Gage Rap Is Real!’
PUBLISHED SINCE 1889 BY DOW JONES & COMPANY
Rupert Murdoch
Robert Thomson
Executive Chairman, News Corp
Chief Executive Officer, News Corp
Gerard Baker
Editor in Chief
Leader Mitch McConnell of Kentucky. You then replied that the U.S.
could impose tariffs on European
cars. This is exactly how trade wars
escalate: from steel beams to Jim
Beam to Beemers. Who knows what
comes next?
Your administration’s attempts to
understate protectionism’s costs are
unconvincing. Commerce Secretary
Wilbur Ross argued—apparently
with a straight face—that steel tariffs are no big deal because there’s
very little steel in a can of Campbell’s soup. He meant to imply that
the effects of tariffs would be limited
because steel makes up a tiny share
of the overall U.S. economy. That’s
true. But if we applied the same
principle to every individual industry, we could wind up protecting virtually every American industry that
faces foreign competition.
The tariffs also punish American
allies more than any other nations.
Did you know that the top three exporters of steel to the U.S. are Canada, Brazil and South Korea? Canada
is our super-friendly neighbor to the
north; it even has a Trump hotel.
The Brazilian economy, South America’s largest, is struggling and badly
needs exports. South Korea is our
By Arthur C. Brooks
AEI’s motto, going back to its earliest days, is: “A competition of ideas
is fundamental to a free society.”
Vigorous disagreements, expressed
with civility and respect, strengthen
a democratic and pluralistic culture.
Conformity of ideas leads to stagnation and mediocrity.
After a decade promoting this
mission, what worries me most today—not for AEI, but for America—is
that the competition of ideas is under attack. Many would rather shut
down debate than participate in it.
Politicians from both parties try to
discredit their opponents with namecalling and ad hominem attacks. On
too many college campuses, people
with the “wrong” viewpoints and
ideas are unwelcome. Much of the
mass media has become polarized,
meaning readers and viewers on the
right and left are never challenged in
their conviction that the other side is
made up of knaves and fools.
Americans must commit to stand
athwart this trend. That doesn’t
mean advocating mushy moderation
or abandoning strong policy positions. My AEI colleagues are warriors for democratic capitalism, here
and all around the world. But we also
fight for respectful debate and repudiate the holy war of derision on
both left and right, which makes dialogue increasingly untenable.
Part of this stance is pragmatic—
no one has ever been insulted into
agreement. Further, we need opposing
viewpoints to challenge our own. If
we’re wrong, the best way to learn it
is through challenges from our friends
on the other side of the issue.
More important, this is a moral
concern. A couple of years ago I was
giving a speech at a large conservative event, and I said that while my
own views are center-right, I have no
reason to believe progressives are
stupid or evil. An audience member
countered, “You’re wrong: They are
stupid and evil.” This bothered me
because the person was insulting
many of my family and friends. You
probably love someone with whom
you disagree politically.
Another threat to the world of
ideas is arguably even more insidious: mediocrity through trivialization, largely from misuse of new
media. To understand this, remember Gresham’s law: “Bad money
drives out good.” If one form of
currency is inherently more valuable than another in circulation, the
better one will be hoarded and thus
disappear.
Today, we see a kind of intellectual Gresham’s law. Famous academics spend big parts of their days
trading insults on Twitter. Respected
journalists who suppress their own
biases in their formal reporting show
no such restraint on social media,
hurting their and their organizations’ reputations. When half-baked
280-character opinions and tiny hits
of click-fueled dopamine displace
one’s hard-earned training and vocation, it’s a lousy trade.
I remain optimistic that think
tanks, universities, and the media
will continue to play a central role in
American democracy. But the challenges to decency and seriousness
are real, and complacency can be
catastrophic. As my late colleague
Michael Novak insisted: “Liberty is
the most precarious of all regimes.”
This is a call to action to scholars,
not just policy makers. I have no
doubt that my beloved colleagues at
AEI are up to this task, and the institution will go from strength to
strength under new leadership.
This Is Exactly How Trade Wars Begin
By Alan S. Blinder
Reflections
On a Decade
Of Leading a
Think Tank
.
THE WALL STREET JOURNAL.
A20 | Thursday, March 15, 2018
WORLD NEWS
China Signals Shift From Birth Limits
Government sidelines
agency overseeing
one-child policy to
focus on aging citizenry
China hasn’t seen a big increase
in population after allowing all
couples to have two children.
China’s population,
change from a year earlier
2.0%
2015
One-child policy
scrapped
1.5
1.0
0.5
0
1981
’90
2000
’10
’17
Source: National Bureau of Statistics via
Wind Info
THE WALL STREET JOURNAL.
LIU JUNXI/XINHUA/ZUMA PRESS
BEIJING—The Chinese government is sidelining a familyplanning bureaucracy originally set up to manage the
country’s contentious onechild policy, a sign Beijing
wants to de-emphasize birth
restrictions in favor of issues
related to an aging population.
As part of a broad government reorganization, several
government agencies will
merge under one ministry, replacing what is now called the
National Health and Family
Planning Commission.
While family planning will
still be part of the work of the
new ministry, to be called just
the National Health Commission, the disappearance of the
words “family planning” from
its name was seen as a clear
sign of a shift in priorities. According to the plan laid out
this week at China’s annual legislative session, the new health
agency will “actively deal with
population aging,” handling issues such as the development
of the elderly care sector and
overhauling an overburdened
health-care system.
The plan “signals that family planning as a macro regulation policy has become his-
Family Matters
The government has eased its grip on birth restrictions and has abolished the one-child policy.
tory,” said Zuo Xuejin, a
researcher specializing in population economics at the
Shanghai Academy of Social
Sciences, a government think
tank.
Many Chinese cheered what
was seen as the dismantling of
a half-a-million-strong bureau-
cracy that, especially in the
early years, was blamed for
brutal practices such as forced
abortions and that is still in
charge of extracting heavy
fines from birth offenders.
“I’m not sad never to see
them again,” said Huang Yanfang, an insurance agent in
Hubei province. She said the
local family-planning agency
fined her almost 100,000 yuan
(about $15,000) for her second
child, born in May 2015. She
sued the local agency in 2016,
once the one-child policy had
been declared null and void.
Under a settlement late last
year, the local agency retracted the fine.
Some parents celebrated
the news by sending virtual
cash gifts to one another on
the popular WeChat messaging app, and gleeful comments
circulated on social media.
The commission “didn’t
bring us any happiness; instead it turned China into an
aging country,” said one commenter on the Weibo microblogging platform. “Time to
set up the birth-facilitation
commission,” another said.
The government has been
easing its grip on birth restrictions over the years and in
late 2015 said it was abolishing the one-child policy, in
place since 1980. But the big
bump in births expected from
allowing all Chinese couples to
have two children has largely
failed to materialize.
In 2016, the first year after
the policy was dropped, the
number of newborns rose 7.9%
from 2015, to 17.86 million. But
last year, births dropped to
17.23 million, the National Statistics Bureau said in January.
Officials have said the number
of births are “within expectations.”
Delegates to the legislative
meeting, the National People’s
Congress, sounded more
alarms over China’s dire demographic situation. Zheng
Gongcheng, a member of the
internal-affairs commission of
the congress, said at a briefing
on Monday that the portion of
people over age 60 increased
from 10% of the population in
1999 to 17.3% last year.
The health and family-planning commission didn’t respond to requests to comment.
The agency in its existing form
was in turn the result of a
merger five years ago of what
was then the National Population and Family Planning Commission and the Ministry of
Health.
Many saw the move as a
step toward the abolition of
birth restrictions.
—Liyan Qi and Fanfan Wang
Overseas Demand Helps Fuel Better-Than-Expected Economic Growth
BEIJING—China’s economy
expanded faster than expected
in the first two months of
2018, helped by strong overseas demand for Chinese
goods, though economists
warned trade tensions with the
U.S. threaten to derail that momentum in the months ahead.
Industrial production, a
rough proxy for economic
growth, expanded by 7.2% in
January and February from a
year earlier, the National Bureau
of Statistics said Wednesday,
well above the 6.2% pace in De-
cember and forecasts for a 6.1%
rise by economists polled by
The Wall Street Journal.
China releases combined data
for January and February to
limit distortions caused by the
timing of the Lunar New Year
holiday, which fell in January
last year and February this year.
Fixed-asset investment and
retail sales also showed surprising strength.
“The sharper-than-forecast
growth momentum was mainly
boosted by robust overseas
demand and higher invest-
ment from property developers and private investors,”
said Ding Shuang, an economist with Standard Chartered.
Fixed-asset investment, a
closely watched indicator of
construction activity, climbed
7.9% in the two-month period
from a year earlier, quickening
from a 7.2% increase in 2017
and beating forecasts for a 7%
gain. Retail sales grew 9.7%
from a year earlier, compared
with a 9.4% rise in December
and forecasts for 9.6% growth.
The
export-demand
7.2%
Growth of industrial production
in January and February
strength was signaled last
week in data showing an unexpected 44.5% surge in exports
in February and a widening of
China’s global trade surplus.
Economists expect the ben-
efit from overseas demand to
fade as U.S. President Donald
Trump ramps up trade penalties. Mr. Trump has announced
increased tariffs of steel and
aluminum products and has
vowed to roll out targeted
measures against Chinese intellectual property theft.
“Even without a trade war
with the U.S., it’s almost impossible for China to maintain
over 20% export growth for
the rest of the year,” Standard
Chartered’s Mr. Ding said.
A Chinese official said China
would work with the U.S. on
nurturing global economic
growth and addressing trade
disputes. “The trade imbalances
between China and the U.S. are
a result of market competition,”
said Mao Shengyong, a spokesman at the statistics bureau.
Meanwhile, China’s property
sector, which accounts for onethird of the country’s economic
growth, again proved its resilience, despite a government
crackdown on speculation and a
push to establish a property tax.
—Grace Zhu and Liyan Qi
.
TECHNOLOGY: EUROPE TARGETS SILICON VALLEY AS TRADE TENSIONS RISE B4
BUSINESS & FINANCE
© 2018 Dow Jones & Company. All Rights Reserved.
S&P 2749.48 g 0.57%
S&P FIN g 1.20%
* * * **
S&P IT g 0.07%
THE WALL STREET JOURNAL.
DJ TRANS g 1.72%
WSJ $ IDX g 0.03%
LIBOR 3M 2.145
Thursday, March 15, 2018 | B1
NIKKEI (Midday) 21674.48 g 0.47%
See more at WSJMarkets.com
Toys ‘R’ Us Set to Close All U.S. Stores
Chain plans to liquidate
or sell its operations
abroad; ‘putting a forsale sign on everything’
BY PAUL ZIOBRO
AND LILLIAN RIZZO
Toys “R” Us Inc. told employees Wednesday the struggling big-box retailer will sell
or close all its U.S. stores, a
collapse that threatens up to
33,000 American jobs in the
coming months.
The 70-year-old chain,
which filed for bankruptcy
protection in September, has
more than 700 remaining U.S.
locations, including Babies “R”
Us stores. It would be one of
the biggest retail liquidations
since Sports Authority filed
for bankruptcy in 2016 with
14,500 workers and closed
more than 460 stores.
Chief Executive David Brandon delivered the company’s
fate to workers at its Wayne,
N.J., headquarters. The company planned to file liquidation papers Wednesday evening in advance of a
bankruptcy court hearing on
Thursday.
“I have always believed that
this brand and this business
should exist in the U.S.,” Mr.
Brandon said on a follow-up
conference call with staff, adding that he guarantees that
vendors who failed to support
the retailer during the holidays, customers who shopped
elsewhere and media who
chronicled the chain’s downfall
will miss the retailer.
“The constituencies who
have been beating us up for
months will all live to regret
what’s happening here,” Mr.
Brandon said.
Toys “R” Us has struggled
with more than $5 billion in
debt from a leveraged buyout.
It also was squeezed by competition from Amazon.com
Inc. as more parents shop online, as well as discount retail-
33,000
Number of employees who could
lose their jobs in coming months
ers such as Walmart Inc.
In addition to shutting
down U.S. operations, Mr.
Brandon told staffers the com-
pany was likely to liquidate in
France, Spain, Poland and Australia. It plans to sell its operations in Canada, Central Europe and Asia. The company is
also trying to package its Canadian business with 200 U.S.
stores and find a buyer, the
CEO said.
“We’re putting a for-sale
sign on everything,” Mr. Brandon told employees. “Frankly,
all anyone has to do is offer
one dollar more” than is being
offered by liquidation firms.
The company will pay workers
at least 60 days of salary and
benefits.
Outside the U.S., the chain
has another roughly 800
stores. Altogether, court papers show Toys “R” Us has
roughly 1,600 stores globally,
with approximately 60,000
employees. That number
reaches more than 100,000
during peak holiday season.
The retailer’s U.K. arm recently filed for the British
equivalent of chapter 11 protection, and will close more
than 100 stores. This would
eliminate nearly one-third of
its European footprint.
On Wednesday’s call, Mr.
Brandon detailed how the
company’s fate spiraled toPlease see TOYS page B2
Insider Trade Alleged
After Equifax Breach
BY MICHAEL RAPOPORT
AND DAVE MICHAELS
UNION PACIFIC
A former technology executive at Equifax Inc. was indicted on criminal insidertrading charges over claims he
sold shares in the company after finding out about its large
data breach last year, days before it was made public.
Jun Ying, who had been
chief information officer of
Equifax’s U.S. Information Solutions unit, also faces civil
charges from the Securities
and Exchange Commission.
The charges against Mr.
Ying are the first to be filed
related to the Equifax breach,
in which the personal information of 147.9 million U.S. consumers was compromised.
The charges aren’t related
to earlier concerns that some
top Equifax executives had
sold shares soon after Equifax
first discovered suspicious activity in its systems in late
July. Mr. Ying isn’t as senior
as those executives, who have
been exonerated by an Equifax
internal investigation.
Mr. Ying deduced in late
August that Equifax had suffered a breach before he was
actually informed of it, the
SEC said, based on confidential information the company
had provided to him. He then
exercised all of his vested
Equifax stock options and sold
the resulting shares, authorities said, garnering more than
$950,000 in proceeds 10 days
before Equifax publicly disclosed the breach.
“Corporate insiders who
learn inside information, including information about material cyber intrusions, cannot
Please see TRADE page B2
Union Pacific’s drones monitor some railroad yards to check on compliance with safety procedures. Screenshot captured by a drone.
A Bet on Bezos Yields a Bonanza
Hovering Drones Irk Rail Workers
Return on $1,000 investment in Amazon stock at the IPO
BY PAUL ZIOBRO
Union Pacific Corp. riled
employees recently when it
started flying drones over
some of its railroad yards to
ensure workers were following
safety guidelines.
The aerial spotters were
looking for any number of behaviors that deviate from the
railroad’s rule book, from
passing between railcars that
are less than 100 feet apart to
climbing off moving equipment.
The response from the railroad workers’ union? Urging
the rank and file to flood
Union Pacific’s safety hotline
with complaints that the
drones make their jobs more
dangerous.
Workers say that rather
than promote safety, the
drones create a hazard by distracting them when they
should be laser-focused while
around 200-ton locomotives
and railcars moving along the
tracks, according to Steve
Simpson, general chairman
with the International Association of Sheet Metal, Air, Rail
and Transportation Workers.
“They are no longer looking
ahead or at their task at
hand,” he said. “They’re looking up.”
Mr. Simpson, whose general
committee represents 1,600
conductors, engineers and
Beijing Flags Down
One More Deal Maker
SHANGHAI—An upstart oilman with ties to China’s military intelligence, Ye Jianming
shot from obscurity to spearhead multibillion-dollar deals
with leaders in Africa, Europe
and Russia that won the blessing of President Xi Jinping.
Now, Mr. Ye is under investigation in China, according to
people familiar with the situation, and his private Shanghai
conglomerate, CEFC China
Energy Co., is drawing unusual scrutiny from the government and media.
Troubles for Mr. Ye follow
the November arrest in New
York of a top lieutenant, on a
federal indictment that outlines allegations of bribery to
secure major energy contracts
for CEFC and advance China’s
economic and strategic interests in Africa.
According to one of the
people familiar, the U.S. case
has been discussed by China’s
leadership, with an aide to Mr.
Xi recently carrying a message
to Washington that CEFC is in
disfavor.
Shanghai authorities in recent weeks have been supervising operations at the oil
producer and trader, according
to those people. Now, CEFC’s
biggest play yet—a $9 billion
deal for a stake in PAO Rosneft
to become the third-largest
shareholder in Russia’s staterun producer—is being delayed, according to a Chinese
debt rating agency that cited
discussions with a CEFC unit.
Neither Mr. Ye nor CEFC
are facing charges, and neither
responded to requests for
comment. Chinese authorities
often question business people
as part of investigations without saying so publicly, and
don’t necessarily level charges.
CEFC in a statement earlier
this month said the company
was operating normally and
disputed a Chinese media report that Mr. Ye had been detained.
Little known a decade ago,
Mr. Ye quickly built CEFC into
the unlikely No. 4 player in an
oil industry dominated by
three of the world’s largest
state-run producers.
The company reports over
$40 billion in annual revenue
including Middle East oil production, financial holdings in
Central Europe, trading in
Singapore and oil-storage depots for China’s strategic national reserve. A person with
Please see OIL page B6
other rail workers in the
southern U.S., also advises
members on complaints to the
Federal Aviation Administration and Federal Railroad Administration. He said there is
no way to distinguish a drone
flown by Union Pacific from
one operated by an unauthorized party.
As of March 1, Union Pacific
temporarily grounded the aerial observation so it can share
its findings with the unions
but plans to resume the program in coming weeks. “Their
leadership will help us establish a collaborative process to
address unsafe behaviors and
protect employees,” Union Pacific spokeswoman Raquel Es-
INSIDE
DEBATE OVER
PETS EMBROILS
UNITED
AIRLINES, B3
FICO’S LOCK ON
CREDIT SCORES
DRAWS FIRE
BANKING, B10
pinoza said.
Mr. Simpson said he suspects safety isn’t the company’s only motivation. Workers see drones as a means to
discipline them, he said, with
escalating penalties that can
lead to termination. There is
no indication anyone has been
fired for an infraction spotted
from up to 400 feet in the air,
but Mr. Simpson said workers
have been cited for violations
as a result.
Ms. Espinoza said Union Pacific has been using drones to
conduct federally mandated
field testing and will coach
employees to correct behavior
that could cause serious inPlease see DRONES page B2
$1.2 million
Wednesday
$1.06 million
1.0
0.8
0.6
0.4
May 15, 1997
Amazon IPO
0.2
0
2000
2010
THE WALL STREET JOURNAL.
Source: FactSet
Amazon.com founder Jeff Bezos has created a company whose
market value trails only that of Apple and Alphabet. B4
HEARD ON THE STREET | By Dan Gallagher
Broadcom Plots Its Next Move
Hock Tan
isn’t easily
dissuaded. It
is a quality
that has
served the
Broadcom CEO very well
over the past few years as he
has cobbled together one of
the largest and most successful chip companies in
the world.
But there is a time to
stand down or, in the case of
Mr. Tan, to live to fight another day. His dogged pursuit of Qualcomm was a
bold gambit that would have
made Broadcom the world’s
third-largest chip maker. But
Broadcom was ordered Monday by President Donald
Trump to desist in the name
of national security, which
the company begrudgingly
agreed to do Wednesday.
That leaves Broadcom
with the problem of what to
do with itself now. Mr. Tan
has spent the past several
years building up a chip empire that now owns strong
positions in several key markets such as smartphones,
data centers and networking
gear.
Mr. Tan’s deft manage-
ment of these entities has allowed the company to boost
revenue, earnings and cash
flow consistently. But M&A
always has been a key part
of that plan. The company
has swallowed up several
large chip businesses in the
past five years.
Qualcomm would have
been the most ambitious
move to date. The loss of
that deal frees up Mr. Tan to
consider others, with the obvious drawback being that
almost anything else at this
point will seem small by
Mixed Signals
Forward price/earnings ratios
18 times
17
PHLX Semiconductor Index
16
15
14
13
12
Broadcom
11
2017
Source: FactSet
THE WALL STREET JOURNAL.
’18
comparison.
Broadcom’s next move
may not be apparent for a
while. The company is in the
process of redomiciling to
the U.S., a process it expects
to complete by May 6. That
should help with the heightened government scrutiny
that now accompanies tech
deal making in the U.S.
Meanwhile, Broadcom’s
strong financial performance
should give it a strong line
of credit with investors as it
plots its next move.
Broadcom’s fiscal first
quarter results due Thursday
afternoon will show revenue
in the range of $5.3 billion to
$5.35 billion, according to
preliminary results reported
by the company in January.
That represents growth of
29% year over year at the
midpoint.
With Broadcom’s stock
price now fetching only 13
times forward earnings—a
record discount of 21% to the
PHLX Semiconductor Index—
investors shouldn’t need audacious deals to make this
bet pay off.
Broadcom still plans to
redomicile in U.S...................... B4
.
B2 | Thursday, March 15, 2018
INDEX TO BUSINESSES
BUSINESS & FINANCE
A
B
Bain Capital ................ B2
Bank of New York
Mellon.....................B12
Barclays.....................B11
Bayerische Motoren
Werke........................B3
Berkshire Hathaway...B2
Boeing..................B3,B11
Broadcom...............B1,B4
C
CapitalG.......................B2
CEFC China Energy.....B1
Cisco Systems...........B12
Citigroup....................B12
Coinbase....................B11
Connecticut Water
Service ...................... B5
CSX.......................B2,B12
D
Daimler .................. B3,B6
Delta Air Lines ......... B12
Dropbox.....................B11
Fiat Chrysler
Automobiles ............. B6
Ford Motor ....... B2,B3,B6
Freddie Mac .............. B10
FujiFilm Holdings........B4
G
GEM.............................B6
General Motors B2,B3,B6
Glencore ...................... B6
Goldman Sachs Group
...................................B11
I-J
Inditex.........................B3
JPMorgan ChaseB11,B12
K
KKR..............................B2
Kohl's...................B5,B11
L
Lockheed Martin.........B3
Lyft..............................B2
M
Macy's.........................B5
Magna International...B2
Microsoft ............... B4,B5
N
Nando's Chickenland
(UK).........................B12
Netflix.......................B12
Nike...........................B12
Nordstrom............B5,B11
Norfolk Southern........B2
Northern Trust..........B12
E
P-Q
Equifax.................B1,B10
Experian...............B2,B10
Prudential..................B10
Prudential Financial..B10
Qualcomm..............B1,B4
F
Fair Isaac...................B10
Fannie Mae ............... B10
R-S
Rothesay Life............B10
Sears Holdings............B5
Signet Jewelers...B3,B11
SJW Group..................B5
Southwest Airlines .. B12
Space Exploration
Technologies.............B3
Spirit Airlines ........... B12
State Street..............B12
T
Takata..........................B6
Tata Motors................B2
Theranos..................... A1
Toyota Motor..............B3
Toys ‘R' Us..................B1
TransUnion................B10
Trump Organization ... A1
21st Century Fox......A11
U
Unilever.......................B6
Union Pacific...............B1
United Continental
Holdings.............B3,B12
United Launch Alliance
.....................................B3
V
VantageScore Solutions
...................................B10
Volkswagen............B3,B6
Vornado Realty Trust.B2
W
Walmart......................B1
Walt Disney................A1
Wells Fargo...............B10
WPP.............................B2
X
Xerox ........................... B4
Z
Zurich Insurance Group
...................................B10
INDEX TO PEOPLE
A
G
P
Abbasi, Yousef..........B11
Aziz, Asam................B12
Gamble, John..............B2
Gaskin, Joanne..........B10
Parker, Dennis.............B5
B
H
Bischke, Jon................B5
Boidevezi, Laurent ... A13
Bouffard, David...........B3
Brandon, David ........... B1
Bruno, Tory ................. B3
Burns, Barrett...........B10
Holmes, Elizabeth......A1
Houston, Drew..........B11
C
Chapek, Robert...........A1
Critchlow, Anne..........B3
D
Damore, James...........B5
Dhillon, Harmeet........B5
Dombrovskis, Valdis.B10
Donohue, Sean..........A13
Downs, Erica...............B6
Drosos, Gina................B3
E-F
Espinoza, Raquel ........ B1
Feroz, Zeeshan..........B11
R
Rorsted, Kasper........B12
I
Icahn, Carl...................B4
Iger, Robert.................A1
Inderst, Andreas.......B12
Isla, Pablo ................... B3
K
Kapoor, Raj..................B2
Kleinhanzl, Brian ...... B12
Klepach, Bernard......A13
Kotagiri, Swamy.........B2
S
Shotwell, Gwynne ...... B3
Simpson, Steve...........B1
Sloan, Timothy ......... B10
Solanes, Paula .......... B11
Sorrell, Martin............B2
Surls, James.............A13
T
Tan, Hock .................... B1
V
Visentin, John.............B4
L
W
Lampert, Edward........B5
Lawrence, Earl............B2
Watt, Mel..................B10
Wells, Mike...............B10
Wilberg, Arne ............. B5
M
Martin, Jill..................A1
Mayer, Kevin...............A1
Musk, Elon..................B3
Y
Ye, Jianming ............... B1
Ying, Jun.....................B1
WPP Cuts Stock Payment to Chief
BY NICK KOSTOV
The flagging performance of
WPP PLC, the world’s biggest
ad agency, is eating into the
pay of one of the industry’s
best-paid executives.
On Wednesday, WPP disclosed that Chief Executive Officer Martin Sorrell received
£10 million ($14 million) in
company shares as compensation for 2017, a significant drop
from the £41.6 million in
shares that Mr. Sorrell was
awarded a year prior.
The payment is the first
time Mr. Sorrell has been compensated under a five-year remuneration program that began in 2013 when WPP’s board
instated a cap on his pay in response to investor anger over
executive salaries. The pro-
gram, which is linked to company financial targets and
share-price performance, rewarded Mr. Sorrell 73% of the
total shares he would have received if the executive had hit
all of his targets.
Mr. CEO’s total pay package—including his salary, a
short-term bonus, pension
payments and other benefits—
won’t be known until WPP
publishes its annual report
next month.
Mr. Sorrell, long regarded as
an oracle of the ad industry, is
coming under investor scrutiny
as his empire of agencies—
from Grey and Ogilvy & Mather
to Young & Rubicam—strains
amid the industry’s digital disruption. The 73-year-old executive is grappling with clients
who are turning away from
Lyft Inc. agreed to develop
hardware and software for
self-driving vehicles with autoparts supplier Magna International Inc., the latest in a
string of deals by the ridehailing company aimed at getting robot cars on the road.
Magna is also injecting
about $200 million into Lyft,
joining a $1.7 billion funding
round led by Alphabet Inc.’s
CapitalG venture arm that values the private startup at $11.7
billion.
The companies plan to produce kits that can be installed
on existing cars to enable
them to operate autonomously, said Raj Kapoor, Lyft’s
chief strategy officer. Retrofitting cars, as opposed to building new ones, could help the
company produce autonomous
vehicles more quickly and inexpensively, he said.
Wednesday’s announcement
EDUARDO MUNOZ/REUTERS
Continued from the prior page
jury. “We are finding drones
are valuable tools that can
help us reach our ultimate
goal of operating in an incident-free environment and ensure employees go home
safely,” Ms. Espinoza said. She
added that the company
hotline has received only one
complaint about the use of
drones.
Drone use is still in its infancy in the railroad industry.
Companies have sought to incorporate it into operations to
inspect bridges and track, assess damage after natural disasters and map networks.
Other proposed or active uses
have included spotting trespassers, air-quality tests and
aerial photography.
Earl Lawrence, who runs
the FAA’s drone-integration office, said he was unaware of
any other industries where
employers are using drones to
enforce safety rules.
Berkshire Hathaway Inc.’s
BNSF railroad, which, like
Union Pacific, operates in the
western U.S., has worked
closely with the FAA to find
ways to incorporate drones
into its operations. After obtaining waivers to fly drones
outside the line of sight of
their operators, BNSF in 2015
flew an unmanned, fixed-wing
aircraft over 270 miles in New
Mexico to inspect tracks.
Since then, BNSF has received permission to conduct
tests on more than 2,000 miles
Union Pacific's personal-injury
rate edged up in 2017 after
hitting a record low.
1.25 injuries
1.00
0.75
0.50
0.25
0
2013
’14
’15
’16
’17
Note: Reportable personal injuries per
200,000 employee-hours worked
Source: the company
THE WALL STREET JOURNAL.
of track, including at night.
Norfolk Southern Corp.
uses drones only for bridge inspections, a spokeswoman said.
CSX Corp. uses the aircraft to
monitor its rail network, collect data and conduct security
checks. Drones also have been
used as part of installing positive train control, a new, federally mandated safety system, a
spokesman said.
Union Pacific first received
FAA approval to use drones in
2015. It first deployed drones
to monitor employees in December 2017 at a rail facility
in Ste. Genevieve, Mo., later
expanding to 14 locations.
“It’s a useful tool,” said Mr.
Simpson, the railroad union
leader. “But it’s being used as
a discipline tool and that worries me.”
Martin Sorrell’s
empire of ad agencies
is straining amid
digital disruption.
over the past year as Mr. Sorrell has wrestled with the loss
of lucrative accounts. Consumer-goods giants and other
companies are redirecting
spending they once lavished
on ad agency-led campaigns
BY GREG BENSINGER
Toys ‘R’ Us carried a breadth of toys unmatched by rivals, and it nurtured many smaller companies.
Safety Record
toward tech companies such
as Facebook Inc., or handling
aspects of media-buying or
production in-house.
Earlier this month, WPP
shares dropped sharply after it
logged its worst annual performance since the financial
crisis and forecast no growth
for 2018.
“His pay has now come down
by a lot two years in a row, and
it’s still so large. It shows you
how massive it was,” said Stefan
Stern, director of the U.K.’s High
Pay Centre, an independent
think tank in London.
Under WPP’s previous incentive program, Mr. Sorrell
received almost £210 million in
compensation between 2012
and 2016, leading to run-ins
with investors who argued the
amount was exorbitant.
Lyft Picks Up a Robot-Cars Partner
TRADE
Continued from the prior page
betray shareholders for their
own financial benefit,” said
Richard Best, director of the
SEC’s Atlanta regional office.
Mr. Ying “took advantage of
his position,” said Byung J.
Pak, the U.S. attorney in Atlanta.
Attorneys for Mr. Ying declined to comment. A warrant
was issued for his arrest on
Wednesday, according to court
records. Equifax said it informed authorities of Mr.
Ying’s trading once the company became aware of it and
has cooperated with the government’s investigation. “We
take corporate governance and
compliance very seriously, and
will not tolerate violations of
our policies,” Equifax said.
Equifax had offered Mr.
Ying a promotion as companywide CIO just days after the
breach was publicly announced in September and the
previous CIO had left the company, according to the SEC.
The company later rescinded
its offer after Equifax senior
executives learned of Mr.
Ying’s trading, the SEC said,
and Mr. Ying resigned from
Equifax in mid-October.
Mr. Ying, 42 years old,
wasn’t among the Equifax executives who were told of the
breach after the company first
learned of it, but he figured
out what happened, according
to the charges. He was asked
to help in responding to what
the company then told him
nerships.
Lyft’s goal is to plug autonomous cars from partners into
its network. The Magna deal is
Lyft’s first involving a largescale manufacturer, and the
kits they develop could be sold
to auto makers, ride-hailing
networks or even drivers
themselves, Lyft said.
Magna assembles vehicles
for other auto makers, and
manufactures parts such as
seating and powertrains.
Last summer, Lyft formed a
self-driving-vehicle division
with an office in Silicon Valley.
Swamy Kotagiri, Magna’s chief
technology officer, said the
Canadian company will move
some employees to Lyft’s Palo
Alto, Calif., offices.
The companies declined to
provide some details about the
agreement, including the size
of Magna’s stake, how long the
partnership will last, or what
each side contractually agreed
to deliver. If Lyft ultimately
uses technology the companies
jointly develop, it must rely on
Magna to manufacture it, Mr.
Kotagiri said.
Magna or Lyft could choose
to sell the kits to other auto
manufacturers, Mr. Kapoor
said. “Everything we develop
in autonomous-vehicle technology, Magna can spread
across the technology industry,” he said.
shrinking and its market share
was falling. Lenders were supportive but worried about the
costly upgrades needed to
bridge the business to the holidays, the CEO said.
The senior management
team tried to sell potential investors on buying the brand,
but the buyers were wary
given the performance of the
latest holiday season, which
they worried could be a proxy
for future years.
“The last six months have
been pure hell,” Mr. Brandon
said during the 30-minute call,
while audibly battling a cold.
The demise of Toys “R” Us,
which had more than $11 billion in global revenue last
year, poses a serious challenge
to the $27 billion U.S. toy industry. The chain was a vital
cog in the industry as its
stores carried a breadth of
toys unmatched by rivals, nurtured smaller companies and
offered a spot on shelves for
tinkerers hoping to hit it big.
Toys “R” Us was toppled by
external forces and those of its
own making. Amazon has
taken a large slice of the toy
industry, as online shopping
cuts the need to visit stores to
buy toys that will ultimately
be wrapped for holidays or
birthdays. The internet also
heightened price wars, as Amazon, Walmart Inc. and Target
Corp. fought hard for toy sales,
often using popular items as
loss leaders that could lead to
sales of other products.
Other retailers have been
able to survive the shift to online shopping and adjusted
their business models. But
Toys “R” Us has struggled to
find a path forward because of
debt accumulated from the
$6.6 billion buyout by Vornado Realty Trust and the
private-equity firms Bain Capital and KKR & Co. in 2005.
Auto-parts supplier Magna plans to inject $200 million into Lyft.
adds to Lyft’s roster of selfdriving-vehicle
partners,
which includes Ford Motor
Co.; General Motors Co.; Alphabet’s Waymo; Tata Motors
Ltd.’s Jaguar Land Rover; and
Aptiv PLC, formerly Delphi.
That stands in contrast to
rival Uber Technologies Inc.,
which is primarily developing
self-driving technology on its
own rather than forging part-
TOYS
DRONES
Madison Avenue campaigns for
print and TV in favor of technologies that target consumers
as they surf the internet.
WPP’s share price has
dropped by almost one-third
GRAHAM WALZER/BLOOMBERG NEWS
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.
Adidas ....................... B12
Allianz ....................... B10
Alphabet...........B2,B4,B5
Amazon.com...B1,B5,B12
American Water Works
.....................................B5
Aptiv............................B2
Aqua America.............B5
Arjuna Capital.............B5
THE WALL STREET JOURNAL.
* ****
Continued from the prior page
ward a liquidation during the
past few frantic months. Following the September bankruptcy filing, holiday sales at
Toys “R” Us were “no short of
devastating” and well below
expectations. The chain’s earnings before interest and taxes
were “less than half” of the
$600 million it typically generates in a year, he added.
The company revamped its
restructuring plans to calm
vendors. First, it announced
plans to close 182 U.S. stores,
or about 20% of its base. Then
it offered to shrink to about
half its original U.S. footprint.
After the U.K. business began liquidating, Toys “R” Us
decided to jettison its baby
business entirely, since that
was where margins were
was a data breach at a potential Equifax client. When he
questioned the move, he was
told he had to comply and
didn’t need to know why.
Immediately after that, according to the charges, Mr.
Ying texted one of his subordinates, “Sounds bad. We may
be the one breached…Starting
to put 2 and 2 together.”
Mr. Ying later searched online for information on a past
data breach at Equifax rival
Experian PLC and how it affected the company’s stock
price, according to the
charges. Less than an hour after that, he exercised all of his
6,815 stock options and sold
the resulting shares, the
charges said. He avoided
losses of more than $117,000
that he would have suffered
had he not sold until after the
breach became public on Sept.
7, the SEC said.
Mr. Ying had worked at Equifax since 2013 and was the company’s international CIO before
becoming CIO of the U.S. Information Solutions unit.
Some other Equifax executives, including Chief Financial
Officer John Gamble, had previously faced questions about
their sale of about $1.8 million in
Equifax shares in early August,
not long after Equifax first detected suspicious activity in its
systems. But in November, an investigation by a special committee of Equifax’s board found Mr.
Gamble and the others hadn’t
known about the breach when
they sold their stock. That investigation covered only senior executives and didn’t look at Mr.
Ying’s trading.
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Thursday, March 15, 2018 | B3
* * * * * *
BUSINESS NEWS
United Continental Holdings Inc. said a flight attendant
didn’t realize a bag that a passenger was forced to stow in an
overhead compartment contained a dog, which died during
the flight.
The dog’s death on a flight
from Houston to New York on
Monday touched off outrage
among some fliers and fresh
debate over the transport of
animals in plane cabins.
“The customer did tell the
flight attendant that there was
a dog in the carrier,” United
said on Wednesday. “However,
our flight attendant did not
hear or understand her, and did
not knowingly place the dog in
the overhead bin.”
United has apologized for
the dog’s death and said it will
issue new bright yellow tags by
April to passengers traveling
with pets in carriers.
The airline on Wednesday
also had to apologize for a mixup at its Denver hub that misdirected two dogs, with one arriving in Tokyo instead of
Kansas City, Mo. The airline
said both animals arrived
safely—albeit at the wrong airports—and would be rerouted
as soon as possible
The union representing
United flight attendants on
Wednesday defended the crew
member on the New York flight.
“There is not a single flight
attendant working for any airline who would knowingly direct a passenger to put their
pet in an overhead bin,” a
spokeswoman for the Association of Flight Attendants-CWA
said.
The number of pets on
planes has soared in recent
years. Passengers generally pay
to bring dogs and cats with
them in the cabin, but are also
carrying a wider range of species from snakes to spiders as
support animals that aren’t
SpaceX,
Big Rival
Share
Rocket Job
BY ANDY PASZTOR
Seeking to maintain a pair
of satellite-launch providers,
the Air Force basically split
$640 million in contracts between Elon Musk’s low-cost
SpaceX and a Boeing Co.Lockheed Martin Corp. joint
venture with higher prices but
a long military legacy.
Wednesday’s announcement
said the awards were part of
continuing efforts to reduce
costs “while maintaining assured access to space with two
or more launch providers.”
Space Exploration Technologies Corp., the formal name of
Mr. Musk’s company, won a
$290 million contract to launch
three Global Positioning System
Satellites into orbit on Falcon 9
rockets by the end of 2020. The
Southern California company
previously was awarded two
other GPS launches.
United Launch Alliance, the
joint venture that historically
enjoyed a virtual monopoly
boosting U.S. military or spy
satellites into space, was
awarded a $351 million deal for
two launches of Air Force spacecraft on Atlas V rockets. Based
on Air Force numbers, those
launches will cost roughly $170
million apiece, or more than $70
million above SpaceX prices.
SpaceX has used low prices,
reusable boosters and aggressive marketing to snare business from rivals, particularly
United Launch Alliance.
The joint venture is developing a lower-cost family of
rockets, but those aren’t expected to begin routine flights
for at least three or four years.
“SpaceX is pleased with the
Air Force’s decision to select
us for all five of the GPS
[launches] competed to date,”
said
Gwynne
Shotwell,
SpaceX’s president and chief
operating officer.
Tory Bruno, president and
CEO of United Launch, told reporters Tuesday that development of its next-generation
rocket, Vulcan, is on track.
charged.
Some airlines have tightened
their policies to rein in instances of poor behavior by animals on board. Delta Air Lines
Inc. this month began requiring
that passengers provide more
health information on their animals and sign a document attesting that they will behave.
Sharon Pinkerton, head of
legislative and regulatory policy
at the Airlines for America
trade group, said the Transportation Department was expected to soon revise its rules
on flying with service and emotional-support animals.
The industry wants the department to clarify its guidance, she said, adding that it
would “make it clear that carri-
The number of pets on
airlines has soared as
passengers pay to take
them into the cabin.
ers have the ability to ensure
the health and safety of passengers and crew.”
Transportation Department
officials didn’t respond to a request for comment.
United carries more animals
than any other U.S. airline, according to Transportation Department data, and has also
been involved in more fatalities in recent years. In 2017,
the airline, the nation’s thirdlargest, was involved in 18 of
24 animal deaths reported to
the department.
Some social-media users
called for tighter restrictions on
animals in flight, while others
urged fliers to boycott United,
whose shares fell 2.6% on
Wednesday. Last April, the carrier’s reputation took a hit after
United gate agents called in airport police in Chicago who then
dragged a passenger off a flight.
Fashion seller Inditex
sharpens digital focus
and slows expansion
of its physical stores
BY JEANNETTE NEUMANN
ARTEIXO, Spain—Zara parent company Inditex SA said
Wednesday it was easing the
expansion of its brick-andmortar stores and doubling
down on its online growth in a
bid by the world’s largest
fashion retailer by sales to
maintain its momentum.
The moves come as the
company, which has expanded
rapidly and outpaced rivals by
quickly getting the latest
styles to stores, reported its
weakest comparable annual
sales growth since 2015.
Executives
at
Inditex,
whose eight brands include
Massimo Dutti and Bershka,
said they would continue to
close smaller shops to prioritize the opening of large, emblematic stores in busy city
centers around the world, including 10 new Zara stores in
the U.S. this year.
Store closures outpaced
openings in the company’s
fourth quarter, with total
stores falling for the first time
quarter-to-quarter to 7,475
from 7,504. But total floor
space rose 7.4% over the year
to Jan. 31, highlighting the focus on opening big stores from
Venice to Miami. Executives
said that pace is expected to
slow to about 4% to 6% in
2018 and beyond.
At the same time, the company said it plans to operate
online stores in all 96 markets
where it currently operates, up
from 49 markets today. “Online sales [are] becoming more
and more relevant,” Inditex
Chairman and Chief Executive
Pablo Isla told analysts from
the company’s headquarters in
Arteixo in northwest Spain.
In a nod to the online category’s growing importance,
the company broke out online
sales as a percentage of total
sales for the first time. Online
Closures of Inditex stores outpaced openings during the fashion retailer’s most recent quarter.
Signet Jewelers
Cuts Back at Malls
Signet Jewelers Ltd. said it
would close more than 200
stores this fiscal year but open
new ones outside of shopping
malls, as one of the biggest mallbased chains combats slumping
sales at its existing locations.
The jewelry retailer, which
owns Kay Jewelers, Zales and
Jared The Galleria of Jewelry,
said it hasn’t adapted quickly
enough as consumers make
fewer trips to stores and shop
more online or on their smartphones. The company’s sales
have declined for the past two
fiscal years.
Three-fourths of the stores
Signet aims to close are in malls
where there are other Signet
stores, Chief Executive Gina
Drosos said on the company’s
earnings call Wednesday. Most
of the closures will happen after
the holiday shopping season.
Signet said it plans to open
35 to 40 new stores in the current fiscal year, though the new
locations “will be focused on already-proven off-mall formats
and desirable markets,” Ms.
Drosos said.
The company currently has
more than 3,500 stores. Last
fiscal year, Signet closed 242
stores and opened 116, company spokesman David Bouffard said in an email.
Shares in Signet fell 20% to
close at $38.22 on Wednesday.
In the past year, the stock is
down 44%.
Signet expects net cost
savings of $85 million to $100
million for the current fiscal
year from the new plan.
Fourth-quarter sales rose 1%
from a year earlier, to $2.29 billion. Total same-store sales fell
5.2%.
Net income rose 18% to
$351.3 million, or $5.24 a share,
from $297.5 million, or $3.92 a
share.
—Allison Prang
sales made up 10% of Inditex’s
annual sales of €25.3 billion
($31.4 billion) for the year
ended Jan. 31. Online sales
surged 41% during that period.
The comments came as the
company reported a 7% rise in
net profit to €3.4 billion for
the year ended Jan. 31 and
said it would propose a 10%
rise in its annual dividend to
75 European cents a share.
However, sales at stores
that have been open at least a
year rose 5%, a marked slowdown from the 10% growth reported the previous year and
the weakest annual comparable-sales growth since 2015,
when the figure also rose 5%.
The company also reported
an annual gross margin of
56.3%, the lowest in a decade.
Comparable sales remained
weak in the first six weeks of
the new reporting period, rising 4% from Feb. 1 to March 11,
analysts said. “The colder
weather compared to last year
across Europe had a negative
impact,” Société Générale analyst Anne Critchlow wrote in a
research note.
KRISZTIAN BOCSI/BLOOMBERG NEWS
BY DOUG CAMERON
AND PATRICK MCGROARTY
Zara’s Owner Alters Style
FRANCISCO SECO/ASSOCIATED PRESS
Dog’s Death Puts
United in Center
Of Debate on Pets
VW sedans are loaded for export in Germany. There is a wide gap
between U.S. and EU import duties.
VW Chief Backs
Trump on Tariffs
BY WILLIAM BOSTON
BERLIN—The chief executive of Volkswagen AG’s namesake VW brand said Wednesday
that
the
Trump
administration is justified in
questioning the wide discrepancy between import duties
imposed by the U.S. and the
European Union on auto imports.
The comments from Herbert Diess during a news conference in Wolfsburg, Germany, are the first from a
senior European auto executive to lend support to President Donald Trump’s allegation that the gap in import
duties on cars was unfair to
U.S. exports to Europe.
Under global trade rules set
in 1994, the EU imposes a 10%
duty on cars and trucks from
the U.S. and other countries,
the maximum allowed. The
U.S. applies a 2.5% tariff on
imported passenger cars, the
maximum it is allowed under
the pact.
“You certainly have to ask
why we in Europe are demanding a 10% import tax,” Mr.
Diess said. “It is a legitimate
discussion. The Americans
don’t do this.”
Pickup trucks and work
vans heading to the U.S. from
Europe face a 25% tariff that
dates from a trans-Atlantic
trade dispute in the early
1960s. European countries including the then-West Ger-
many taxed chickens imported
from the U.S., and Washington
retaliated with a tariff that included pickups and vans made
by the likes Volkswagen and
others.
Mr. Trump sparked an outcry in Europe after he took to
Twitter to attack the EU’s import duties and threaten BMW
AG and Daimler AG’s Mercedes-Benz with a tax on their
imports to the U.S.
“If the EU wants to further
increase their already massive
tariffs and barriers on U.S.
companies doing business
there, we will simply apply a
Tax on their Cars which freely
pour into the U.S.,” Mr. Trump
said on Twitter earlier this
month. “They make it impossible for our cars (and more) to
sell there. Big trade imbalance!”
Volkswagen operates a factory in Chattanooga, Tenn.,
where it builds its popular
Jetta sedan and the Atlas
sport-utility vehicle. One of
the company’s largest factories
in the world is in Puebla, Mexico, which builds the Golf
among other models for export
to the U.S.
Mr. Diess suggested that the
company could be forced to
shift production from Mexico
to the U.S. if the North American Free Trade Agreement—
which Mr. Trump has criticized—were dissolved or if
Washington imposed prohibitive tariffs on auto imports
from Mexico.
announces the opening
of our
Milan
office
Corso Matteotti 1
Milan, Italy
Nicoló Piotti
Managing Director
npiotti@payden.com
LOS ANGELES | BOSTON | LONDON | MILAN
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.
B4 | Thursday, March 15, 2018
THE WALL STREET JOURNAL.
* *
TECHNOLOGY
WSJ.com/Tech
Amazon: From Garage to Global Giant U.S. Tech Firms
Jeff Bezos founded Amazon.com Inc. in 1994 in his garage in Seattle.
From its roots as an online bookstore, it has grown into an empire
valued at roughly $770 billion. From e-commerce, a dominant cloudservices business, a grocery chain and a Hollywood studio, the company
last year generated $178 billion in revenue. While not all of its ventures
have succeeded, Amazon now accounts for more than 40 cents of
every dollar U.S. consumers spend online. Here is how it happened..
$160B
Amazon annual revenue
140
120
100
80
60
1994
40
May 1997
Initial public
offering
’96
20
0
’98
2000
Each block
represents
a product, store,
service or merger
introduced by
Amazon.
’02
’04
’06
’08
2010
’12
’14
’16
’18
By Natalia Drozdiak
in Brussels
and Sam Schechner
in Paris
According to a 2015
Gartner report, Amazon
Web Services ran more
than 10 times as much
computing capacity in
use as the next 14 cloud
providers combined.
Through its marketplace the
company has made it easy for
third-party merchants, and
their sales are often more
profitable for Amazon than its
own direct sales.
While Prime initially was
launched as an unlimited
two-day shipping program for
about a million products,
Amazon has now expanded
the offering into a massive
loyalty shopping program.
Introducing its own
products has been
important for Amazon’s
global retail growth.
Today Amazon has a
commanding lead in the
smart-home field thanks
to its first-to-market
Echo devices. The Fire
phone, released that
same year, was a flop.
Grocery delivery is difficult
and expensive— even for
Amazon. AmazonFresh
was available in more than
20 markets before the
company cut back last year
in some ZIP codes.
Retail stores
Services, tools
and technology
Prime and delivery
Original content,
products and apps
Amazon started as an
online bookstore, but its
Kindle e-reader further
disrupted the publishing
industry.
Amazon Web Services
Mergers and
acquisitions
The company’s purchase
of Whole Foods Market
gave it a substantial
physical footprint overnight
Estimated U.S. Prime subscribers Amazon facilities, by type
Total Amazon U.S. patents*
Amazon Studio releases
60 million
500 centers
8,000 patents
58
400
6,000
56
300
54
200
52
100
40 releases
35
Television shows
30
New season of an
25
original series
20
Movies
15
10
5
0
50
Fulfillment Centers
Other
4,000
2,000
0
2017
0
2000
’05
’10
Europe is zeroing in on U.S.
tech companies amid rising
trans-Atlantic trade tensions.
France on Wednesday petitioned to fine Apple Inc. and
Alphabet Inc.’s Google for allegedly taking advantage of
smaller French software developers. A complaint filed by the
’15
2000
2010
*Includes pending applications as of Feb. 21
Sources: the company; Dealogic (mergers); Cowen Proprietary Group (Prime members); MWPVL International (centers); Justia (patents)
ADVERTISEMENT
Legal Notices
To advertise: 800-366-3975 or WSJ.com/classifieds
2013
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By Hanna Sender, Laura Stevens and Yaryna Serkez/
THE WALL STREET JOURNAL.
Icahn Taps Tech Veteran
For Xerox Proxy Fight
BY AISHA AL-MUSLIM
BANKRUPTCIES
’14
Activist investor Carl Icahn
has enlisted the help of former
technology executive John
Visentin to help prepare for a
proxy fight with Xerox Corp.
and to explore strategic alternatives for the printer and
copier maker.
Mr. Icahn reached out to
Mr. Visentin as a consultant to
help with those processes,
part of his pushback against a
deal Xerox struck with
Fujifilm Holdings Corp. in
January. That deal would
mash Xerox together with a
Fuji-Xerox joint venture and
give the Japanese company
control of the new entity.
In an open letter from Mr.
Icahn to Xerox shareholders
published Wednesday, Mr.
Icahn said Mr. Visentin is an
“operating executive with a
superb track record, specifically when it comes to revamping complex operations
with prior managerial shortcomings in the IT services industry.”
Mr. Icahn has said Xerox
would benefit from new management and has indicated
that its executives should have
some of the qualities he men-
tioned Mr. Visentin has.
In response to Mr. Icahn’s
letter, a Xerox spokesman
pointed to a prior letter the
company wrote outlining the
value of the deal.
Mr. Visentin previously
managed business units as an
executive at Hewlett-Packard
Co. and International Business
Machines Corp. He more recently was at Apollo Global
Management portfolio companies Novitex Enterprise Solutions, where he was executive
chairman and chief executive,
and Presidio, where he was
chairman, according to the letter.
Mr. Icahn and fellow billionaire Darwin Deason, who together control about 15% of
Xerox stock, have opposed the
deal with Fujifilm and are
working together to fight it.
They both have said they
would vote against the deal,
that they would wage a proxy
fight against Xerox and that
they have asked it to explore a
sale.
Xerox has said the investors
are mischaracterizing the deal.
The company said the agreement with Fuji followed a
yearlong review of alternatives for its business.
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finance ministry asked a Paris
court to order the companies
to end “abusive commercial
practices.”
In Brussels, the European
Union next week plans to unveil two legislative proposals
to increase taxes on tech giants. The new rules, which the
EU has been working on since
last year, would hit squarely at
the U.S.’s largest tech firms.
Tension over trade is escalating between Brussels and
Washington. The European
Commission, the EU’s executive body, has warned it will
take countermeasures against
the U.S. if it isn’t exempted
from plans by President Donald Trump to impose tariffs on
steel and aluminum imports.
Also, the recent U.S. tax overhaul could hit European tech
and pharmaceutical firms operating in the U.S.
Each side has accused the
other of protectionism, raising
the specter of a trade war.
“Don’t consider this aggressive from us,” Pierre Moscovici, the European Commission’s economy chief, said in
reference to the EU’s tax plans.
“It’s not an anti-American
measure. The fact is that some
of those companies are American. It’s not protectionist. It’s
about fair taxation.”
The EU wants to modernize
corporate tax rules, which traditionally have been based on
physical assets and where a
company operates. The commission wants to account for
virtual operations, such as targeted advertisements that a
search engine sells using data
collected in a country where it
has no fixed establishment.
Under the new rules, the EU
would likely tax tech firms’ revenue, as opposed to profit. The
legislation could be short-term,
preceding broader changes defining permanent establishment in the virtual world.
The short-term tax rate
could range between 1% and 5%
and could target revenue based
on where users are located,
though details of the package
are still being finalized, EU officials said. In an interview, Mr.
Moscovici said the new rules
would avoid risks of double taxation as well as unnecessary
burdens on smaller businesses.
France has led the push to
increase taxes on the tech
companies, calling on the commission to propose the shortterm measures. French Finance
Minister Bruno Le Maire and
others argue that tech giants
use legal loopholes to shift too
much profit to low-tax jurisdictions, and that Europe must
tax revenue instead until laws
can be changed to stamp out
such practices.
The move in Paris comes after U.K. Treasury Chief Philip
Hammond confirmed Tuesday
that he intends to explore the
merits of tweaking the way
corporation tax is levied on
tech multinationals operating
in the U.K.
The French finance ministry’s filing against Google and
Apple on Wednesday follows a
three-year government investigation into how the Silicon
Valley companies treat French
startups that develop and sell
applications
for
mobile
phones. Some developers and
publishers are unhappy that
Apple and Google can at times
take a portion of in-app purchases and get access to more
data on users and subscribers
than they do.
“We believe our terms comply with French laws and are
looking forward to making our
case in court,” a Google
spokeswoman said. Apple
didn’t immediately respond to
requests to comment.
The finance ministry, meanwhile, says there is no connection between taking on tech
firms and the new U.S. tax law
France is also seeking
fines for Apple and
Google for ‘abusive
commercial practices.’
and tariffs.
Still, some EU officials have
cautioned that the bloc’s new
tax rules could be perceived by
Washington as a form of retaliation against Mr. Trump’s tariffs, particularly if the EU
doesn’t pursue a long-term
agreement at a global level with
the Organization for Economic
Cooperation and Development.
The OECD is a forum of wealthy
countries, which includes EU
countries, Japan and the U.S.
“It’s difficult for the Europeans to guess what the reactions of the Americans will be
and what context they are going to set this,” said Pierre
Gramegna, Luxembourg’s finance minister. “And that’s
why it’s so important that this
is being done at OECD level.”
DANIEL BRENNER/BLOOMBERG NEWS
July 1994
Amazon.com is
incorporated
Face Tougher Tax
Rules in Europe
A demonstration of Google technology in Paris this month.
Broadcom Affirms Plan
To Assume U.S. Address
BY CARA LOMBARDO
Singapore-based Broadcom
Ltd. said Wednesday it still
plans to redomicile to the U.S.
after the Trump administration forced it to withdraw its
hostile bid for U.S. chip maker
Qualcomm Inc.
Broadcom earlier this week
said it expected to complete
the process in April, about a
month earlier than originally
planned. Redomiciling would
have allowed Broadcom’s bid
for Qualcomm to skip a review
by the Committee on Foreign
Investment in the U.S., an interagency panel that focuses
on national security concerns.
Broadcom also withdrew its
slate of independent directors
it nominated for election to
Qualcomm’s board.
President Donald Trump
blocked Broadcom’s $117 billion takeover of Qualcomm on
Monday, after CFIUS said it
could have had implications
for the U.S.’s broader technological competition with China.
Broadcom Chief Executive
Hock Tan stood with Mr.
Trump at the White House in
November when he announced
Broadcom’s plans to relocate
in the U.S. Mr. Trump called
Mr. Tan a “great, great executive” and said Broadcom was
“one of the really great, great
companies.”
Broadcom was formed when
Avago Technologies bought the
former Broadcom in 2015 and
kept the name. About half of
its employees work in the U.S.
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | B5
MANAGEMENT
Diversity Efforts Challenged
Some white men push back against programs for hiring women and people of color
Two high-profile legal
cases in which white men
have accused employers of
discrimination or retaliation
have put a spotlight on U.S.
companies’ efforts to make
career advancement more
accessible to women and
people of color.
A recruiter is accusing
YouTube of retaliating against
him after he complained that
the video site discriminated
against white and Asian male
applicants in favor of hiring
blacks, Hispanics and women.
The case comes on the heels
of a lawsuit against Google, in
which James Damore has accused the company of firing
him for espousing conservative political views that oppose the company’s diversityrelated hiring practices.
Alphabet Inc., parent
company of Google and YouTube, said it would defend
itself in both cases in an
area that has been heavily
litigated. Discrimination is
generally difficult to prove,
and so-called reverse-discrimination lawsuits must
pass an even higher bar, employment lawyers say.
“You can have a goal, even
a numerical goal over a time
period, to increase the number
of women or people of color,”
said Dennis Parker, director of
the racial justice program at
the American Civil Liberties
Union. “That’s different than
saying, ‘We’re not going to
hire any more white men.’ ”
The cases could have
broader implications for Silicon Valley companies and
their recruiting methods as
the tech industry faces continued scrutiny for a lack of
diversity. While discrimination against any sex or race
is forbidden by federal statute, courts have long allowed
companies to put in place
programs meant to correct
imbalances, such as targeted
outreach and training courses
MICHAEL SHORT/BLOOMBERG NEWS
BY LAUREN WEBER
Alphabet’s YouTube and Google are each facing litigation related to their hiring practices.
designed for people from underrepresented groups.
One of the last major cases
alleging discrimination
against white men was decided in 2009 when the Supreme Court sided with white
firefighters who said the New
Haven, Conn., fire department discriminated against
them by invalidating the results of a test used to determine promotions. Fearing the
test would be called discriminatory, the fire department
threw out the results and
used other measures to make
promotions when black firefighters scored poorly.
Courts still allow companies to deploy programs designed to open up opportunities to a broader segment of
the workforce. In such cases,
judges look closely at details.
Arne Wilberg, the plaintiff
in the suit against YouTube, is
a white recruiter who worked
at Google for nine years, including four years at YouTube. He alleges that the
video site told recruiters to
cancel interviews with applicants who weren’t female,
black or Hispanic after setting
quotas for hiring minorities.
“We have a clear policy to
hire candidates based on
their merit, not their identity,” a Google spokeswoman
said in response to the suit.
“At the same time, we unapologetically try to find a
diverse pool of qualified candidates for open roles.”
Google fired Mr. Damore in
August after he circulated a
memo that criticized Google’s
diversity efforts and suggested women were less qualified than men for some technology jobs. Mr. Damore and
a co-worker sued, accusing
Google of being a hostile
workplace for employees with
conservative views and alleging it unfairly favors women
and certain minorities when
hiring and promoting.
Mr. Damore also filed a
charge with the National Labor Relations Board but
withdrew it in February after
an NLRB lawyer advised the
board that parts of his
memo were “so harmful, discriminatory, and disruptive”
that it wasn’t protected
workplace speech.
Mr. Damore’s attorney,
Harmeet Dhillon, said that
since the lawsuit was filed,
she has been contacted by
“countless current and former Google employees as
well as employees of other
tech companies making similar allegations.”
Many U.S. employers are
under pressure to diversify
their payrolls and, by extension, tackle issues like the gender wage gap, sexual harassment and economic inequality.
For example, activist shareholder Arjuna Capital has led
campaigns to compel firms including Amazon.com Inc. and
Apple Inc. to identify and fix
pay disparities between male
and female workers.
The tech sector has come
under scrutiny ever since big
firms began disclosing data
about the makeup of their
workforces, said Jon Bischke,
chief executive of Entelo, a
recruiting software firm that
helps companies hire technical talent. “Their numbers
effectively have to go up every year,” he said. “If their
numbers went backward,
that would be a public-relations nightmare.”
BUSINESS NEWS
Big Water Companies Set to Merge
BY CARA LOMBARDO
SJW Group is in advanced
talks to merge with Connecticut Water Service Inc. in a
roughly $750 million deal that
would create the nation’s thirdlargest publicly traded water
utility and represents a rare
tie-up among such companies.
The terms of the deal,
which could be announced
Thursday, call for Connecticut
Water shareholders to receive
1.1375 shares of SJW Group
stock for each share, according to people familiar with the
matter.
Based on Wednesday’s closing prices, that would work
out to about $61.86 a share,
an 18% premium over Connecticut Water’s closing price.
SJW shareholders are to
own about 60% of the combined company, which would
serve more than 1.5 million
customers across four states.
SJW and subsidiaries including San Jose Water serve
more than one million people
in and around San Jose, Calif.,
and Canyon Lake, Texas.
It has a market capitalization of around $1.1 billion and
in 2017 had revenue of more
than $389 million.
Connecticut Water and subsidiaries provide water to
more than 450,000 people in
Connecticut and Maine and
wastewater services to more
than 10,000 people in Connecticut. It has a market capitalization of around $630 million, and analysts expect it to
report 2017 revenue of about
$105 million.
The new company would be
the third-largest water and
wastewater utility based on
rate base and enterprise
value.
American
Water
Works Co. and Aqua America
Inc. are the first- and secondlargest.
generate.
SJW Chief Executive Eric
Thornburg, who led Connecticut Water for more than 11
years before departing for his
current job late last year,
would be chairman and chief
executive of the combined
company, the people said.
Connecticut Water CEO David Benoit, who officially took
over last week, would be president of its New England region. The combined company’s
board will include seven directors appointed by SJW and
five by Connecticut Water, the
people said.
The companies don’t plan
to cut jobs or increase water
rates following the merger, the
people said. The combined
company is expected to establish a dividend at least equal
to SJW’s announced 2018 dividend of $1.12 a share. Both
companies have long paid regular dividends.
The combined company will
be better positioned to expand
its geographic reach by acquiring more municipal utilities and service contracts
around the country, the people said.
There has been a frenzy of
deal activity in the broader
utility sector as companies diversify across geographic areas. Utilities have also grown
as cash-strapped municipalities with aging infrastructures
sell their systems or outsource management.
But municipalities still own
most water utilities in the U.S.
and the expected tie-up would
be the first of its kind between publicly traded ones in
about 20 years, one of the
people said.
Potentially
encouraging
deal making, water utilities
have been trading at relatively
rich valuations, partly because
of the steady earnings they
Sears Reports Another Dismal Quarter
Sears Holdings Corp. announced $540 million in new
loan agreements and reported
another dismal quarter in
which sales fell by nearly a
third as the struggling retailer
continued to close stores.
Total sales fell to $4.4 billion for the three-month period ended Feb. 3 from $6.1
billion a year earlier. Excluding the closures, sales fell 18%
at existing Sears stores and
12% at Kmart locations for the
three-month period ended Feb.
3.
The company’s results contrast with those of other retailers, including Macy’s Inc.,
Kohl’s Corp. and Nordstrom
Inc., all of which reported
higher sales for their year-end
periods as consumer spending
picked up over the holiday
season.
Sears swung to a $182 million profit for the period, compared with a loss of $607 million in the same period a year
ago, helped by a $470 million
MARK BLINCH/REUTERS
BY SUZANNE KAPNER
Sears Holdings is under pressure to refinance some of its debt.
tax benefit related to the new
tax law.
The company, which has
struggled for years under the
leadership of Edward Lampert,
a financier who is its chief executive, chairman and largest
shareholder, also announced
three new loan agreements to-
taling $540 million, some of
which are from entities controlled by Mr. Lampert.
“We made progress in 2017,
with another quarter of yearover-year improvement in our
financial result,” Mr. Lampert
said. “We also recognize that
we need to do more if we are
to deliver on our commitment
to return to profitability in
2018. Importantly, to ensure
our long-term viability, we
must substantially improve
our sales and gross margin
performance, including adjustments to our business model.”
Sears ended the quarter
with $336 million in cash and
$69 million available on its
credit line. Total debt stood at
$4.12 billion.
Sears is under pressure to
refinance a portion of that
debt coming due in October. A
failure to do so could tip the
retailer into bankruptcy, analysts have said.
Sears’s bonds are on Fitch
Ratings Inc.’s list of those at
risk of default.
Mr. Lampert has for years
defied his critics with financial
maneuvers, such as a deal
reached last year to sell
Sears’s Craftsman brand, that
have kept the company afloat.
Sears shares, which have
fallen more than 70% over the
past this year, closed down 5%
at $2.42.
.
THE WALL STREET JOURNAL.
B6 | Thursday, March 15, 2018
BUSINESS NEWS
Glencore Fuels China’s Electric-Car Aims
Commodity firm to
sell a big supply of
cobalt, used to make
lithium-ion batteries
Glencore mine workers. Demand for cobalt is expected to increase as electric cars and smartphones grow around the world.
A Saudi Aramco oil field. Some of the world’s biggest oil-producing
countries believe oversupply is weighing down oil prices, despite caps.
Saudis Continue
To Curb Output
Amid Iran Split
BY SUMMER SAID
Saudi Arabia said it would
continue limiting its crudeoil output, signaling that the
world’s top oil exporter remains committed to production caps and underscoring a
split with Iran’s call for gradually lifting output curbs.
In an unusual news release
Wednesday, Saudi Arabia’s
national oil company said its
crude output would remain
below 10 million barrels a
day and its exports below 7
million barrels a day.
Saudi Arabian Oil Co., or
Saudi Aramco, as the state oil
company is known, generally
doesn’t signal in advance
how much oil it will pump
and export in a given month.
Saudi Aramco has the capacity to pump as much as 12
million barrels a day but has
limited its output along with
the Organization of the Petroleum Exporting Countries,
Russia and other big producers to reduce a global oversupply with the aim of supporting prices.
“Saudi Arabia continues to
lead by example by producing
below the production targets
it agreed to,” the energy ministry said in the news release.
Oil prices rose after the
Saudi news release before
paring some of those gains.
Brent crude, the international
benchmark, settled up 0.39%
at $64.89 a barrel on
Wednesday, while West Texas
Intermediate, the U.S. benchmark, rose 0.41% to $60.96.
The Saudi energy ministry’s message Wednesday
came just before OPEC released a market report that
showed global oil supplies
rising despite the group’s
production limits. The report
initially caused crude prices
to fall, as it underlined worries that U.S. shale production is undermining Saudi efforts to rebalance the
market.
The Saudi news release
was sent out after The Wall
Street Journal reported Sunday that Iranian Oil Minister
Bijan Zanganeh said his country would push for production caps to be eased in the
future so as not to overheat
oil prices.
Saudi Arabia and Iran are
split on the ideal oil price. Iran
is pushing for prices at $60 a
barrel, where Mr. Zanganeh
says U.S. oil production will remain under control and not
flood the market. Saudi Arabia
is pushing for $70 a barrel as
Crown Prince Mohammed bin
Salman plans record national
spending on the military and
an economic transformation.
OPEC and a Russia-led
group of big oil producers
have agreed to limit output
through the end of 2018.
They meet in June, when
Mr. Zanganeh said the group
could decide to begin easing
output limits in 2019.
Over a year after the
agreement was reached, the
world’s biggest oil-producing
countries believe that a
global oversupply of oil is
still weighing down prices. In
all, 24 countries that control
about 60% of global crude
production pledged to withhold about 1.8 million barrels
a day of output, almost 2% of
the world’s output.
OPEC crude production
continued to fall in February,
the group said Wednesday in
its monthly oil market report.
Production dropped by
77,000 barrels a day compared with the month before
to average 32.19 million barrels a day, the report said.
The OPEC-led production
cuts have been part of a recipe for higher oil prices, including strong global economic growth and rising
Middle East political tensions.
—Christopher Alessi
contributed to this article.
bling to secure their own cobalt supplies from sources including
Glencore,
the
company’s chief executive,
Ivan Glasenberg, said on a
conference call in December.
“Electric vehicles will be
disruptive to the world,” Mr.
Glasenberg said. “Cobalt is basically off the charts.”
China is revving up its electric-vehicle industry, the largest in the world. The country
has focused on dominating co-
OIL
Sudden Prospector
Continued from page B1
knowledge of the situation
said CEFC supplies the People’s Liberation Army.
Mr. Ye’s expansion strategy
hinged on turning policies
promoted by Mr. Xi into business opportunities, according
to interviews with his partners
and competitors, as well as
diplomats, bankers and analysts. Several cited evidence of
ties to the PLA and its intelligence arm.
“I think they really have a
strategy to be the largest Chinese investor, a projection of
their power,” said a Chinabased European diplomat who
has dealt with CEFC for three
years.
Mr. Ye’s recent troubles are
the latest to beset a group of
once-highflying Chinese entrepreneurs. They include Chen
Feng, of airlines-to-hotels conglomerate HNA Group Co.,
which is jettisoning assets;
and Wu Xiaohui, the aggressive founder of Anbang Insurance Co., which has been taken
over by the government.
Until recently, Mr. Ye’s focus on “green light” areas for
investment like oil from Russia
may have helped his continued
deal-making in the face of Beijing’s efforts to keep capital at
home, said Erica Downs, an
analyst at Arlington, Va.-based
research group CNA. “But as
we now know from the case of
Anbang and perhaps HNA, ap-
CEFC China Energy burst into
deal-making in recent years.
CEFC's announced deals
$12 billion
10
8
6
4
2
0
0
2012 ’13
’14
’15
’16
’17
Source: Dealogic
THE WALL STREET JOURNAL.
parent connections to top
leaders past and present are
not get-out-of-jail-free cards.”
Hailing
from
China’s
southeastern hill country, Mr.
Ye, now about 40 years old,
became interested in oil trading in the mid-2000s after
working in Hong Kong. He
moved the company now
known as CEFC to Shanghai
in 2008.
Around this time, he served
for about two years as deputy
secretary-general of the China
Association for International
Friendly Contact, according to
regulatory filings by a CEFC
unit in Singapore. That business-outreach organization,
according to foreign military
analysts, including Mark
Stokes of Washington-based
balt resources in the Democratic Republic of Congo,
which turns out about 60% of
the world’s supply.
In 2011, Beijing listed electric vehicles as one of seven
“strategic emerging indusProject 2049 Institute, is
funded by the Chinese military’s intelligence arm.
CEFC is headquartered in
a quarter-block compound in
a section of Shanghai’s former French Concession that
is primarily controlled by
China’s military. Mr. Ye has
said CEFC is guided by “entrepreneurship, Confucianism
and military-style regimentation.”
Mr. Ye saw opportunity after Mr. Xi’s anticorruption
crackdown left state-run oil
giants gun-shy about international investment. CEFC
sealed production rights in
Chad in 2015 and the United
Arab Emirates in 2017. The
roughly $900 million U.A.E.
deal made Mr. Ye a partner to
not only China National Petroleum Corp., but also BP
PLC of the U.K. and France’s
Total SA.
As Mr. Xi pushed a goglobal campaign for Chinese
businesses called the Beltand-Road Initiative, Mr. Ye
named Prague his company’s
“second headquarters” and
scooped up stakes in European property, banks and insurers, as well as a soccer
team. He became an adviser
to the Czech president, and
helped organize Mr. Xi’s visit
to the country in 2016.
Last September, days after
Mr. Xi and Russian leader
Vladimir Putin renewed commitments for energy cooperation, Mr. Ye signed the agreement to buy 14% of Rosneft. It
offered relief for a Russian
government suffering from
sagging oil prices and international sanctions.
“A company with ties to
Chinese military intelligence
may have appeared as a very
reliable partner for the kind of
transaction with Rosneft’s
shares,”
said
Alexander
Gabuev, a senior fellow at Carnegie Moscow Center.
Then came the U.S. Justice
Department indictment that
Mr. Ye’s woes are the
latest to beset a group
of once-highflying
Chinese entrepreneurs.
put CEFC at the center of allegations about Chinese corruption in Africa. CEFC said in a
statement that it “attaches
great importance” to the case
but said it misstates facts
about the company’s activities
in the two nations named,
Chad and Uganda. Those governments also denied the allegations.
The U.S. said its allegations
were built on intercepted
emails. They appear to show
how an official at a CEFCfunded charity bribed top African officials to help CEFC and
state-run giant China National
Petroleum.
CNPC didn’t respond to a
request for comment.
—James T. Areddy
and Stella Yifan Xie
BUSINESS WATCH
TAKATA
More Auto Makers
Sued Over Air Bags
Owners of vehicles with rupture-prone Takata Corp. air bags
sued four additional auto makers, accusing them of concealing
defects in the safety devices tied
to numerous deaths and injuries.
The complaints, filed on
Wednesday in a Miami federal
court, targeted Volkswagen AG,
Daimler AG’s Mercedes-Benz,
Fiat Chrysler Automobiles NV
and General Motors Co. They
follow lawsuits against other
auto makers that have resulted
in settlements collectively totaling more than $1 billion.
Wednesday’s suits allege
plaintiffs suffered losses because the value of their vehicles
fell as a result of the defect.
A Daimler spokesman called
the allegations “unfounded” and
declined to comment further. A
Fiat Chrysler spokesman said
the company hadn’t been served
with the lawsuit against it and
declined to comment. A GM
spokesman said the auto maker
had no reports of ruptures in vehicles with the relevant air bags.
A Volkswagen spokeswoman
didn’t immediately respond to a
request for comment.
—Mike Spector
FORD MOTOR
Steering-Wheel Risk
Leads to a Recall
Ford Motor Co. recalled
nearly 1.4 million midsize cars
JASPER JUINEN/BLOOMBERG NEWS
metal is an essential ingredient in lithium-ion batteries because of its ability to absorb
high levels of heat.
Apple Inc., Tesla Inc., Volkswagen AG and other large
companies have been scram-
SAUDI ARAMCO/REUTERS
Glencore PLC has agreed to
sell a chunk of its cobalt production to a Chinese company,
a person familiar with the
matter said, marking another
victory for China in a race to
lock up supplies of an important metal used in batteries
for electric vehicles.
Glencore, the giant Swiss
commodity producer and
trader, signed a deal several
weeks ago to provide more
than 50,000 metric tons of cobalt over three years to GEM
Co., a Shenzhen-listed chemicals firm, the person said.
Glencore is the world’s biggest
cobalt producer, and the
amount represents about a
third of its production over
the course of the deal.
Once an obscure metal in a
relatively small market, cobalt
is now projected to be in
greater demand as electric-car
production increases and
smartphone use grows around
the world. The scarce blue
PER-ANDERS PETTERSSON/GETTY IMAGES
BY SCOTT PATTERSON
tries.” Chinese firms produce
about 77% of refined cobalt
chemicals, up from 67% in
2012, according to London
commodities researcher CRU
Group.
Glencore has two giant mining operations in Congo and
controls about one-quarter of
cobalt output world-wide.
Glencore has said its Katanga
Mining operation in Congo is
expected to produce 34,000
tons of cobalt by 2019, likely
making it the most productive
cobalt mine in the world.
A report, commissioned by
Glencore and issued by CRU,
forecast that by 2030 the demand for cobalt to be used in
electric vehicles could reach
314,000 metric tons, more
than four times the current
global supply.
One potential obstacle to
gaining Congolese cobalt is
the country’s government,
which is ratifying a new mining code over the objections of
Glencore and other companies.
The code scraps protections
for mining companies and
adds higher taxes and royalties for copper and cobalt.
“It’s going to create underinvestment in the country,”
Mr. Glasenberg said last
month.
Anglo-Dutch consumer-goods titan Unilever is expected to consolidate its headquarters in Rotterdam.
with steering wheels that risk
detaching, the latest in a series
of safety problems to emerge
among the auto maker’s vehicles.
Ford on Wednesday recalled
Ford Fusion and Lincoln MKZ
cars in North America covering
the 2014-2018 model years with
steering-wheel bolts that can
loosen over time. The Dearborn,
Mich., auto maker said it had
tied two accidents and one injury to the defect.
The National Highway Traffic
Safety Administration in October
began probing complaints of loose
steering wheels in Ford Fusion sedans. The agency didn’t immediately respond to a request for
comment on Ford’s decision to recall Fusion and Lincoln MKZ cars.
—Mike Spector
UNILEVER
Rotterdam Expected
To Be New Base
The board of Anglo-Dutch
consumer-goods giant Unilever
PLC has decided to consolidate
its dual headquarters in Rotterdam, in the Netherlands, over
London, according to a person
familiar with the matter.
Unilever is to announce the
decision as early as Thursday.
The British government has been
informed, the person said. Executives and U.K. representatives
were talking Wednesday after
the decision, this person said, injecting some uncertainty. A Unilever spokesperson wasn’t immediately available to comment.
The maker of such staples as
Dove soap splits its headquarters between London and Rotterdam, a legacy of its structure
consisting of separate British
and Dutch operating companies.
Following an unsolicited takeover approach by Kraft Heinz Co.
last year, Unilever launched a review and determined that unification was in its best interests.
The question since has been
which city Unilever would pick.
The decision has significance
in the U.K., which is negotiating
its exit from the European
Union. Critics of that move have
warned the split from the EU
could force some companies to
move to the Continent.
—Saabira Chaudhuri
and Costas Paris
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | B7
MARKETS DIGEST
EQUITIES
S&P 500 Index
Dow Jones Industrial Average
Last Year ago
24758.12 t 248.91, or 1.00%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio 25.91 21.39
P/E estimate *
17.08 17.81
Dividend yield
2.14
2.33
All-time high 26616.71, 01/26/18
Nasdaq Composite Index
Last
2749.48 t 15.83, or 0.57%
High, low, open and close for each
trading day of the past three months.
Year ago
Trailing P/E ratio * 25.79 24.68
P/E estimate *
17.75 18.27
Dividend yield
1.87
1.98
All-time high 2872.87, 01/26/18
Last Year ago
7496.81 t 14.20, or 0.19%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio * 27.25
25.80
P/E estimate *
21.05
20.14
Dividend yield
0.99
1.13
All-time high: 7588.32, 03/12/18
Current divisor 0.14523396877348
26300
2900
7500
25500
2825
7300
24700
2750
7100
23900
2675
6900
23100
2600
65-day moving average
Session high
UP
Close
t
DOWN
Session open
Open
t
Close
65-day moving average
Feb.
6300
2450
21500
Jan.
6500
2525
22300
Session low
Bars measure the point change from session's open
Dec.
6700
65-day moving average
Dec.
Mar.
Jan.
Feb.
Dec.
Mar.
Jan.
Feb.
Mar.
*Weekly P/E data based on as-reported earnings from Birinyi Associates Inc.
Major U.S. Stock-Market Indexes
High
Latest
Close
Low
Net chg
% chg
High
52-Week
Low
% chg
% chg
YTD 3-yr. ann.
Dow Jones
Industrial Average
-1.00
25130.12 24668.83 24758.12 -248.91
Transportation Avg 10799.56 10556.92 10573.48 -184.90 -1.72
687.25
Utility Average
Total Stock Market
Barron's 400
679.48
1.05
7.10
684.72
-0.55
28754.60 28431.18 28478.47 -157.01
742.43
734.47
735.23 -4.55
Nasdaq Stock Market
Nasdaq Composite
7544.89
Nasdaq 100
7084.07
7473.90
7012.57
-0.62
-0.19
7496.81 -14.20
7040.98 -5.53
26616.71 20404.49
18.2
0.2
11.7
11373.38
8783.74
14.6
-0.4
5.7
774.47
647.90
-2.4
-5.3
6.1
29630.47 24125.20
757.37
610.89
15.3
17.1
2.9
3.4
9.8
9.6
7588.32
7131.12
-0.08
5793.83
5332.53
27.1
30.0
8.6
10.1
15.5
17.7
S&P
500 Index
2777.11
2744.38
2749.48 -15.83
-0.57
2872.87
2328.95
15.3
2.8
10.2
MidCap 400
SmallCap 600
1947.78
974.82
1926.01
964.25
1929.28 -11.19
965.18 -5.29
-0.58
-0.55
1995.23
979.57
1681.04
815.62
11.6
14.6
1.5
3.1
9.0
10.9
Other Indexes
Russell 2000
1598.33
1582.64
1584.31
-7.74
-0.49
1610.71
1345.24
14.6
3.2
8.7
12892.90 12743.90 12762.67 -69.08
-0.54
13637.02 11324.53
10.1
-0.4
5.9
8.4
0.2
3.8
Late Trading
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.
Volume, Advancers, Decliners
Most-active issues in late trading
Company
568.78
Value Line
563.18
563.65
-3.01
-0.53
589.69
503.24
Volume
(000)
Symbol
Last
Net chg
14,847.4 275.44
After Hours
% chg
High
0.14
Low
0.05 276.79 275.05
SPDR S&P 500
SPY
KKR
KKR
8,920.0
22.12
...
unch.
22.12
22.12
MPLX
MPLX
5,657.0
34.71
...
unch.
34.71
34.71
PwrShrs QQQ Tr Series 1 QQQ
4,550.8 171.60
-0.08
Plains All Amer Pipeline PAA
-0.05 172.15 171.42
4,319.5
22.75
...
unch.
22.76
Comcast Cl A
CMCSA 4,158.6
36.08
0.06
0.17
36.13
35.98
Ford Motor
F
3,799.2
11.01
-0.01
-0.09
11.16
10.99
Endo International
ENDP
3,613.9
7.05
...
unch.
7.10
7.05
22.73
Percentage gainers…
SRRA
7.2
2.78
0.41
17.30
2.85
2.45
Papa Murphy's Holdings FRSH
9.8
6.25
0.90
16.82
6.25
5.35
Centrus Energy
LEU
5.3
4.20
0.47
12.60
4.20
3.72
Barnes Noble
BKS
28.4
5.30
0.50
10.42
5.40
4.80
Arbutus Biopharma
ABUS
5.5
6.20
0.55
9.73
6.20
5.65
Sierra Oncology
NYSE Composite
NYSE NYSE Amer.
NYSE Arca Biotech
4893.66
4834.58
4856.83
-8.58
-0.18
4939.86
3449.61
33.6
15.0
6.0
NYSE Arca Pharma
553.28
544.54
546.63
-2.98
-0.54
593.12
498.46
5.6
0.3
-0.8
...And losers
KBW Bank
Solid Biosciences
SLDB
97.7
11.89 -14.42
-54.81
26.52
11.35
Benefitfocus
BNFT
38.0
22.70
-2.10
-8.47
24.80
19.00
-1.48
114.54
112.20
112.49
-1.69
116.52
88.02
17.3
5.4
PHLX§ Gold/Silver
15.3
80.21
79.61
0.09
0.11
93.26
76.42
-4.7
-6.4
PHLX§ Oil Service
79.79
6.8
139.57
138.00
138.36
0.18
0.13
171.55
117.79
-18.7
-7.5
-8.7
Ctrip.com Intl ADR
CTRP
420.1
46.00
-2.73
-5.60
49.40
45.00
1430.27
17.59
1410.60
14.94
1423.50
17.23
0.04
0.88
0.003
1445.90
37.32
5.38
960.01
9.14
41.7
48.2
13.6
56.1
26.2
2.5
Altice USA Cl A
ATUS
47.9
19.00
-0.86
-4.33
19.98
19.00
Zendesk
ZEN
17.1
47.49
-1.24
-2.54
48.74
47.49
PHLX§ Semiconductor
Cboe Volatility
Nasdaq PHLX
Sources: SIX Financial Information; WSJ Market Data Group
International Stock Indexes
Percentage Gainers...
Net chg
Latest
% chg
3124.68
404.71
269.10
–16.02
–1.83
–0.92
–0.51
–0.45
–0.34
1.2
1.9
0.9
Americas
Brazil
Canada
Mexico
Chile
DJ Americas
658.27
Sao Paulo Bovespa 86050.96
S&P/TSX Comp
15653.61
S&P/BMV IPC
48156.44
Santiago IPSA
4244.55
–3.57
–332.89
6.47
–400.57
–9.75
–0.54
–0.39
2.5
12.6
–3.4
–2.4
0.8
EMEA
Eurozone
Belgium
Denmark
France
Germany
Israel
Italy
Netherlands
Russia
South Africa
Spain
Sweden
Switzerland
Turkey
U.K.
U.K.
Stoxx Europe 600
Euro Stoxx
Bel-20
OMX Copenhagen
CAC 40
DAX
Tel Aviv
FTSE MIB
AEX
RTS Index
FTSE/JSE All-Share
IBEX 35
SX All Share
Swiss Market
BIST 100
FTSE 100
FTSE 250
Region/Country Index
World
Close
The Global Dow
DJ Global Index
DJ Global ex U.S.
Asia-Pacific
Australia
China
Hong Kong
India
Japan
Singapore
South Korea
Taiwan
Thailand
374.94
378.04
3929.31
900.20
5233.36
12237.74
1499.11
22452.34
530.97
1251.19
58423.17
9688.50
575.32
8869.33
117592.67
7132.69
19820.12
S&P/ASX 200
5935.30
Shanghai Composite 3291.38
Hang Seng
31435.01
S&P BSE Sensex
33835.74
Nikkei Stock Avg
21777.29
Straits Times
3539.41
Kospi
2486.08
Weighted
11038.80
SET
1813.40
YTD
% chg
0.04
–0.82
–0.23
–0.15
–0.55
–0.26
–0.97
–41.16 –1.04
–0.35
–3.17
–0.18
–9.43
0.14
16.71
–0.19
–2.91
–238.64 –1.05
–0.29
–1.55
–34.61 –2.69
–661.34 –1.12
–0.03
–3.20
0.24
1.37
–0.13
–11.59
–0.57
–674.19
–0.09
–6.09
–0.22
–43.11
–39.40
–18.86
–166.44
–21.04
–190.81
–14.32
–8.41
–56.83
3.50
–0.66
–0.57
–0.53
–0.06
–0.87
–0.40
–0.34
–0.51
0.19
–3.7
–1.9
–1.2
–2.9
–1.5
–5.3
–0.7
2.7
–2.5
8.4
–1.8
–3.5
1.1
–5.5
2.0
–7.2
–4.4
–2.1
–0.5
5.1
–0.6
–4.3
4.0
0.8
3.7
3.4
Sources: SIX Financial Information; WSJ Market Data Group
Company
Symbol
Arcadia Biosciences
Daxor Corp
RXi Pharmaceuticals
RF Industries
Syndax Pharmaceuticals
RKDA
Novus Therapeutics
Orgenesis
Xtant Medical Holdings
AquaBounty Technologies
Avenue Therapeutics
NVUS
Seaspan
Mersana Therapeutics
Apellis Pharmaceuticals
Carvana Cl A
OptimumBank Holdings
SSW
DXR
RXII
RFIL
SNDX
ORGS
XTNT
AQB
ATXI
MRSN
APLS
CVNA
OPHC
Symbol
SPDR S&P 500
Ford Motor
Micron Technology
Advanced Micro Devices
Bank of America
SPY
Finl Select Sector SPDR
General Electric
iShares MSCI Emg Markets
Neovasc
Twitter
XLF
F
MU
AMD
BAC
GE
EEM
NVCN
TWTR
Latest Session
Close Net chg % chg
High
52-Week
Low
% chg
47.99 36.32 311.23
7.80 2.80 56.00
4.55 1.35 42.19
4.75 1.30 37.68
13.58 3.00 28.36
54.99
8.73
11.20
5.50
15.70
3.60
3.40
2.51
1.40
7.41
Company
Symbol
189.1
8.5
-43.8
196.9
-7.7
Auris Medical Holding
Babcock Wilcox Ents
Nuverra Envtl Solutions
Signet Jewelers
Sunesis Pharmaceuticals
EARS
3.12
2.76
3.96
2.25
3.40
-20.8
44.3
44.8
-76.2
...
Novume Solutions
Spherix
Net Element
AdvanSix
Aratana Therapeutics
NVMM
6.27
16.70
25.23
21.24
5.12
0.74
1.94
2.83
2.37
0.57
13.38
13.14
12.63
12.56
12.53
7.91 5.02
21.01 12.45
25.59 12.45
24.89 8.14
13.96 1.85
-7.8
...
...
...
32.0
CUI Global
Intellia Therapeutics
NantHealth
Tintri
Silicom
CUI
Volume % chg from Latest Session
(000) 65-day avg Close % chg
90,958
88,123
79,756
78,907
57,428
-17.3
96.4
71.0
36.7
-21.6
275.30 -0.51
11.02 2.23
59.78 0.59
11.36 -2.41
32.14 -0.68
56,266
56,249
50,117
44,888
38,902
-10.1
-36.1
-28.5
530.8
37.0
28.94 -1.13
14.27 -1.11
49.50 0.16
0.13 -7.66
36.60 7.30
52-Week
High
Low
286.63 231.61
13.48 10.14
63.42 24.94
15.65
9.70
33.05 22.07
30.33
30.54
52.08
2.12
36.80
22.00
13.95
38.41
0.13
14.12
t
1.50
t
Federal-funds
target rate
1.00
M.Y. Safra Bank, FSB
New York, NY
2.72%
212-652-7200
0.50
Popular Direct
New York, NY
2.75%
800-274-5696
0.00
AM J J A S ON D J FM
2017
2018
Interest rate
t
Third Federal Savings and Loan
2.75%
Cleveland, OH
888-274-7952
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
2.06
2.15
Money market, annual yield
0.30
0.34
Five-year CD, annual yield
1.61
1.63
30-year mortgage, fixed†
4.48
4.43
15-year mortgage, fixed†
3.94
3.89
Jumbo mortgages, $424,100-plus† 4.75
4.73
Five-year adj mortgage (ARM)† 4.33
4.37
New-car loan, 48-month
3.52
3.55
3-yr chg
52-Week Range (%)
Low 0 2 4 6 8 High (pct pts)
0.50 l
l
3.75
l
1.15
0.25 l
1.27 l
l
3.73
l
2.99
l
4.21
l
3.20
l
2.85
1.50
4.50
2.15
0.36
1.63
4.48
3.94
4.96
4.38
3.60
1.25
1.25
1.87
-0.08
0.13
0.43
0.69
0.31
0.57
0.51
Bankrate.com rates based on survey of over 4,800 online banks. *Base rate posted by 70% of the nation's largest
banks.† Excludes closing costs.
Sources: SIX Financial Information; WSJ Market Data Group; Bankrate.com
One year ago
1
3 6
month(s)
PETX
NTLA
NH
TNTR
SILC
MFUS
Clear Channel Outdoor
AstroNova
Silicom
iFresh
CatchMark Timber Trust
CCO
RKDA
DXR
CEL
RIGS
ALOT
IFMK
CTT
1.65
4.51
20.42
38.22
3.58
-0.87
-1.75
-5.48
-9.69
-0.67
-34.52
-27.96
-21.16
-20.23
-15.67
...
...
12.06 1.61
26.50 9.25
77.94 38.10
7.69 1.82
-80.5
-52.5
...
-44.1
-13.1
3.29
1.70
10.30
36.07
3.80
-0.61
-0.31
-1.78
-6.12
-0.63
-15.64
-15.42
-14.74
-14.51
-14.22
5.50 0.51
4.75 0.89
33.51 2.56
46.51 24.72
7.67 3.72
...
51.8
20.9
36.1
-29.8
2.80
28.81
3.17
3.82
35.79
-0.45
-4.41
-0.46
-0.53
-4.87
-13.85
-13.28
-12.67
-12.18
-11.98
5.65 2.44
35.99 11.15
6.43 2.60
7.75 2.78
77.95 33.56
-43.2
110.0
-24.7
...
-7.4
Volume % chg from Latest Session
(000) 65-day avg Close % chg
1 2 3 5 710
years
maturity
15%
2.25
5
1.50
0
0.75
–5
0.00
–10
30
Euro
1,715
13,779
2,835
633
3,426
18469
9517
4666
3856
3370
28.18 -0.47
47.99 311.23
7.80 56.00
7.47 -2.73
24.62 -0.36
29.49 25.00
54.99 3.60
8.73 3.40
10.77 7.33
25.76 24.39
4,824
338
1,927
232
3,825
3164
3163
2419
1435
1411
4.90 -2.00
14.50 7.81
35.79 -11.98
6.28 -6.13
12.60 -7.42
6.35 3.35
15.65 11.00
77.95 33.56
18.24 6.09
13.73 10.63
US$vs,
YTDchg
Wed
in US$ per US$ (%)
WSJ Dollar index
2017
2018
Corporate Borrowing Rates and Yields
Close
Yield (%)
Last Week ago
52-Week
High
Low
Total Return (%)
52-wk
3-yr
1431.727
2.650
2.695
2.736
1.818
0.554 0.524
10-yr Treasury, Ryan ALM 1676.673
DJ Corporate
371.028
Aggregate, Barclays Capital 1908.110
High Yield 100, Merrill Lynch 2835.540
Fixed-Rate MBS, Barclays 1957.310
Muni Master, Merrill
514.891
2.815
3.724
3.150
6.090
3.350
2.489
2.883
3.727
3.180
6.086
3.390
2.450
2.943
3.747
3.180
6.319
3.400
2.494
2.058
2.879
2.380
4.948
2.660
1.736
1.661
2.752
2.059
4.227
1.670
2.699
791.328
5.993
6.015
6.077
5.279
4.423 6.156
Treasury, Ryan ALM
EMBI Global, J.P. Morgan
–0.173
2.397
1.366
3.785
1.195
1.930
Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch
US$vs,
YTDchg
Wed
in US$ per US$ (%)
Country/currency
.00004392
Vietnam dong
Argentina peso
.0494 20.2272 8.7
Brazil real
.3067 3.2610 –1.5
Canada dollar
.7719 1.2956 3.0
Chile peso
.001663 601.40 –2.3
Ecuador US dollar
1
1 unch
Mexico peso
.0538 18.5841 –5.5
Uruguay peso
.03521 28.4000 –1.4
Venezuela b. fuerte .00002736600.0001 353801.9
Asia-Pacific
Yen
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group
Bond total return index
52-Week
High
Low
U.S.-dollar foreign-exchange rates in late New York trading
Yen, euro vs. dollar; dollar vs.
major U.S. trading partners
10
52-Week
Low
% chg
Currencies
Forex Race
3.00
High
Ranked by change from 65-day average*
PIMCO Dyn Mult US
Arcadia Biosciences
Daxor Corp
Cellcom Israel
RiverFront Strat Incm Fd
SILC
Latest Session
Close Net chg % chg
Americas
3.75%
Colorado Federal Savings Bank
2.71%
Greenwood Village, CO
877-484-2372
ASIX
Symbol
Country/currency
Wednesday
* 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 & COMMODITIES
Compare the performance of selected
global stock indexes, bond ETFs,
currencies and commodities at
WSJ.com/TrackTheMarkets
Benchmark
Yields
Treasury yield
curve
andtoRates
Yield
maturity of current bills,
2.70%
866-518-0286
NETE
Company
Track the Markets
1.63%
NYSE Arca
* Common stocks priced at $2 a share or more with an average volume over 65 trading days of at least
5,000 shares =Has traded fewer than 65 days
* Volumes of 100,000 shares or more are rounded to the nearest thousand
t
2.00%
Five-year CD yields
Live Oak Bank
Wilmington, NC
SPEX
Volume Movers
notes and bonds
Bankrate.com avg†:
SNSS
8.46
13.95
14.52
12.70
8.58
s
5-year CDs
SIG
25.34
23.95
22.21
16.00
13.54
s
Selected rates
A consumer rate against its
benchmark over the past year
NES
1.22
2.68
1.49
0.40
0.65
s
U.S. consumer rates
BW
6.05
13.85
8.20
2.90
5.45
CREDIT MARKETS
Consumer Rates and Returns to Investor
Nasdaq
Total volume*2,069,613,944 225,774,000
Adv. volume* 914,164,923 104,632,751
Decl. volume*1,136,434,627 117,313,347
Issues traded
3,062
1,316
Advances
1,159
534
Declines
1,779
743
Unchanged
124
39
New highs
76
5
New lows
35
8
Closing tick
285
28
Closing Arms†
0.81
0.87
Block trades*
8,588
1,096
Percentage Losers
Most Active Stocks
Company
Total volume* 827,771,656 9,752,707
Adv. volume* 287,380,752 4,364,498
Decl. volume* 525,358,372 5,184,972
Issues traded
3,070
328
Advances
1,247
151
Declines
1,703
162
Unchanged
120
15
New highs
51
1
New lows
85
9
Closing tick
238
3
Closing Arms†
1.34
1.53
Block trades*
6,419
94
Australian dollar
.7876 1.2697 –0.9
China yuan
.1583 6.3181 –2.8
Hong Kong dollar
.1275 7.8414 0.4
India rupee
.01540 64.955 1.7
Indonesia rupiah .0000728 13735 1.9
Japan yen
.009405 106.32 –5.7
Kazakhstan tenge .003105 322.09 –3.2
Macau pataca
.1238 8.0759 0.4
Malaysia ringgit
.2560 3.9065 –3.8
New Zealand dollar
.7331 1.3641 –3.2
Pakistan rupee
.00904 110.600 –0.05
Philippines peso
.0192 52.041 4.2
Singapore dollar
.7639 1.3091 –2.1
South Korea won .0009394 1064.55 –0.2
Sri Lanka rupee
.0064160 155.86 1.5
Taiwan dollar
.03424 29.206 –1.6
Thailand baht
.03209 31.160 –4.4
Commodities
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
TR/CC CRB Index
Crude oil, $ per barrel
Natural gas, $/MMBtu
Gold, $ per troy oz.
Middle East/Africa
Bahrain dinar
Egypt pound
Israel shekel
Kuwait dinar
Oman sul rial
Qatar rial
Saudi Arabia riyal
South Africa rand
2.6522 .3770 –0.02
.0567 17.6390 –0.7
.2910 3.4362 –1.2
3.3347 .2999 –0.5
2.5974 .3850 0.01
.2746 3.642 –0.2
.2666 3.7504 unch
.0849 11.7733 –4.8
Close Net Chg % Chg YTD%Chg
WSJ Dollar Index 83.54 –0.03–0.03 –2.83
Sources: Tullett Prebon, WSJ Market Data Group
Wednesday
629.88
-1.34
194.49
60.96
2.731
1324.40
0.21
0.25
-0.055
-1.50
0.2
.04860 20.574 –3.3
.1660 6.0232 –2.9
1.2369 .8085 –3.0
.003973 251.70 –2.8
.010051 99.49 –3.9
.1294 7.7303 –5.8
.2944 3.3972 –2.3
.01751 57.107 –1.0
.1222 8.1827 –0.04
1.0583 .9449 –3.0
.2578 3.8797 2.2
.0384 26.0566 –7.4
1.3961 .7163 –3.2
52-Week
Pricing trends on someClose
raw materials,
or commodities
Net chg % Chg
High
Low
DJ Commodity
22767
Europe
-0.21
% Chg
YTD
% chg
645.87
532.01
12.38
0.72
0.11 200.52
66.14
0.41
3.63
-1.97
-0.11 1362.40
166.50
42.53
2.55
1200.10
5.82
24.76
-8.39
10.36
0.32
0.89
-7.52
1.39
Get real-time U.S. stock quotes and track most-active stocks, new highs/lows and mutual funds. Plus, deeper money-flows data and email delivery of key stock-market data. Available free at WSJMarkets.com
.
THE WALL STREET JOURNAL.
B8 | Thursday, March 15, 2018
COMMODITIES
Futures Contracts
Contract
Open
High hi lo
Low
Settle
Chg
Copper-High (CMX)-25,000 lbs.; $ per lb.
3.1235
3.1705
3.1230
3.1400 0.0210
March
May
3.1350
3.1920
3.1265
3.1585 0.0205
Gold (CMX)-100 troy oz.; $ per troy oz.
1322.20 1324.10
1322.20 1324.40 –1.50
March
April
1326.90 1330.50
1321.70 1325.60 –1.50
June
1332.70 1336.40
1327.60 1331.40 –1.60
Aug
1337.40 1341.50
1333.50 1337.30 –1.60
Oct
1344.70 1345.10
1340.40 1343.00 –1.70
Dec
1349.00 1354.00
1346.30 1349.20 –1.60
Palladium (NYM) - 50 troy oz.; $ per troy oz.
985.30 1002.10
982.55
984.75 –6.85
June
Sept
984.00
994.90
978.50
979.90 –5.60
Platinum (NYM)-50 troy oz.; $ per troy oz.
967.10
974.90
961.20
961.50 –5.80
April
July
972.00
979.60
966.00
966.30 –5.90
Silver (CMX)-5,000 troy oz.; $ per troy oz.
16.535
16.535
16.500
16.467 –0.092
March
May
16.605
16.670
16.515
16.537 –0.090
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl.
60.83
61.33
60.11
60.96
0.25
April
May
60.84
61.34
60.18
61.02
0.27
June
60.75
61.20
60.07
60.91
0.26
Sept
59.79
60.13
59.07
59.89
0.22
Dec
58.65
59.01
57.96
58.79
0.23
Dec'19
55.32
55.58
54.69
55.47
0.27
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal.
1.8790
1.8962
1.8657
1.8871 .0132
April
May
1.8822
1.8995
1.8705
1.8918 .0149
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal.
1.8927
1.9260
1.8835
1.9243 .0380
April
May
1.9051
1.9346
1.8965
1.9330 .0330
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu.
2.791
2.798
2.710
2.731 –.055
April
May
2.813
2.820
2.737
2.759 –.050
June
2.860
2.867
2.786
2.809 –.047
July
2.905
2.914
2.835
2.859 –.046
Sept
2.901
2.905
2.831
2.858 –.039
Oct
2.915
2.915
2.842
2.870 –.038
Open
interest
May
July
24.75
25.28
24.75
25.28
May
Dec
83.39
78.50
May
July
138.45
139.65
t
24.75
25.28
24.77
25.28
83.87
78.75
82.41
77.81
83.44
78.02
140.90
141.00
138.45
139.05
139.40
139.40
Cotton (ICE-US)-50,000 lbs.; cents per lb.
2,254
145,873
537
252,852
175,282
40,262
5,693
39,786
.14
…
1.40
.80
145-080 146-010
144-050 145-040
145-040
144-030
145-280
144-280
23.0
1,995
24.0 817,560
March
June
120-315 121-090
120-115 120-220
120-270
120-075
121-045
120-175
7.0 22,827
7.0 3,369,198
March
June
114-137 114-175
114-042 114-087
114-095
113-317
114-150
114-060
2.7 21,371
3.2 3,301,362
March
June
106-182 106-190
106-090 106-102
106-167
106-072
106-180
106-092
.5 29,476
.7 1,865,767
98.503
98.330
98.505
98.335
… 113,197
–.005 411,202
94.281
94.078
5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100%
30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg.
March
April
98.505
98.335
98.505
98.340
March
June
93.969
93.734
94.406
94.188
93.891
93.672
72,201
92,150
March
April
98.1700
98.1225
98.1700
98.1225
98.1700
98.1175
82,977
128,606
March
June
Dec
Dec'19
97.8225
97.6950
97.4650
97.1250
97.8275
97.7100
97.4900
97.1750
t 97.8050
t 97.6750
t
10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100%
.281
.313
11,446
23,731
98.1700 .0025
98.1225 –.0025
1,238
4,105
1 Month Libor (CME)-$3,000,000; pts of 100%
Eurodollar (CME)-$1,000,000; pts of 100%
180,602
296,598
87,120
124,226
81,586
128,703
97.4450
97.1000
97.8125 –.0100 1,276,201
97.7000 .0050 1,728,258
97.4750 .0150 1,981,900
97.1500 .0300 2,238,299
–2.00
1,829
–3.00 725,424
May
July
264.00
266.00
264.50
266.50
253.50
255.75
–7.50
Wednesday
Currency Futures
Japanese Yen (CME)-¥12,500,000; $ per 100¥
March
June
.9390
.9449
.9431
.9492
.9371
.9431
.9414
.9475
March
June
.7718
.7734
.7740
.7755
.7707
.7722
.7727 –.0002 104,060
.7742 –.0001 45,029
March
June
1.3973
1.4034
1.3999
1.4057
1.3928
1.3987
1.3976 –.0002 132,007
1.4034 –.0002 72,675
March
June
1.0600
1.0685
1.0614
1.0699
1.0552
1.0638
1.0590 –.0008
1.0676 –.0007
March
April
May
June
July
Sept
Dec
June'19
.7859
.7865
.7872
.7861
.7900
.7897
.7878
.7850
British Pound (CME)-£62,500; $ per £
Swiss Franc (CME)-CHF 125,000; $ per CHF
4,568
t 257.50
259.25 –6.75
762
Soybeans (CBT)-5,000 bu.; cents per bu.
1042.25 1042.75
1032.50 1028.50 –12.00
244
March
May
1048.50 1054.00
1031.00 1032.25 –16.50 396,890
Soybean Meal (CBT)-100 tons; $ per ton.
376.10
376.10
373.90
368.30 –4.00
112
March
May
375.70
380.30
370.60
370.90 –4.60 212,916
Soybean Oil (CBT)-60,000 lbs.; cents per lb.
...
...
...
31.78
–.24
22
March
May
32.20
32.37
31.63
31.71
–.51 245,409
Rough Rice (CBT)-2,000 cwt.; $ per cwt.
1227.00 1236.00
1225.50 1234.00
7.00
5,998
May
July
1251.50 1253.00
t 1243.00 1250.00
6.50
1,218
Wheat (CBT)-5,000 bu.; cents per bu.
485.00
496.50
485.00
495.75 10.25
8
March
May
485.50
490.50
483.00
488.75
2.25 227,688
Wheat (KC)-5,000 bu.; cents per bu.
512.00
512.25
512.00
511.75
4.75
16
March
May
519.50
526.75
517.25
524.75
4.50 123,892
Wheat (MPLS)-5,000 bu.; cents per bu.
...
636.00 s
623.25
623.25 –6.25
1
March
May
624.75
628.75
620.75
621.75 –3.75 32,133
Cattle-Feeder (CME)-50,000 lbs.; cents per lb.
142.175 143.600
141.650 142.050
.500
5,983
March
April
143.225 144.850
142.350 142.725
.425 15,393
Cattle-Live (CME)-40,000 lbs.; cents per lb.
123.000 124.300
122.775 123.000 1.100 78,161
April
June
114.000 114.800
112.900 113.250
.100 151,816
Hogs-Lean (CME)-40,000 lbs.; cents per lb.
67.450
67.725
66.625
66.875 –.850 44,053
April
June
77.300
78.550
77.000
78.350
.875 81,186
Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft.
517.20
519.50
510.10
516.20 –1.00
61
March
May
485.80
488.00
482.50
484.40
–.80
5,220
Milk (CME)-200,000 lbs., cents per lb.
14.21
14.29
14.19
14.24
.04
4,230
March
April
13.85
14.08
13.78
14.05
.22
3,584
Cocoa (ICE-US)-10 metric tons; $ per ton.
2,583
2,587 s
2,583
2,575
24
105
March
May
2,530
2,581 s
2,517
2,556
24 124,136
Coffee (ICE-US)-37,500 lbs.; cents per lb.
119.75
119.75
119.40
119.95
–.50
29
March
May
121.40
122.05
120.65
121.05
–.50 138,343
Sugar-World (ICE-US)-112,000 lbs.; cents per lb.
12.64
12.83
12.58
12.76
.14 423,643
May
July
12.90
13.02
12.84
12.97
.08 208,511
.0030 215,469
.0031 62,246
Australian Dollar (CME)-AUD 100,000; $ per AUD
.7917
.7915
.7914
.7921
.7908 s
.7905
.7902
.7850
.7851
.7854
.7861
.7856
.7900
.7885
.7878
.7850
.7883
.7885
.7885
.7887
.7888
.7893
.7900
.7915
48,332
14,835
.0016
.0017
.0015
.0016
.0015
.0016
.0017
.0016
Mexican Peso (CME)-MXN 500,000; $ per MXN
77,637
754
371
26,866
7
520
314
4
March
June
.05372
.05297
.05394
.05321
.05362
.05288
.05379 .00005 106,350
.05305 .00006 89,873
March
June
1.2397
1.2483
1.2417
1.2504
1.2351
1.2439
1.2379 –.0024 350,018
1.2467 –.0022 225,617
Euro (CME)-€125,000; $ per €
Index Futures
24985
25016
25153
25174
24670
24688
S&P 500 Index (CME)-$250 x index
2777.00
2764.70
March
June
2777.00
2783.10
2745.00
2749.50
Mini S&P 500 (CME)-$50 x index
24770
24788
–257
–262
57,743
88,076
2749.70 –34.20
2753.90 –18.90
76,601
25,760
March
June
2763.00
2767.00
2779.50
2783.50
2744.25
2748.25
2749.75 –18.75 1,334,778
2754.00 –18.75 2,385,499
March
June
1938.90
1944.70
1951.40
1955.80
1926.60
1929.30
1929.90 –11.60
1933.30 –11.50
March
June
7039.5
7062.8
Mini S&P Midcap 400 (CME)-$100 x index
Mini Nasdaq 100 (CME)-$20 x index
7098.0 s
7121.5 s
7012.3
7036.5
Mini Russell 2000 (ICE-US)-$100 x index
7033.5
7058.0
17,972
71,844
–24.8 107,632
–25.3 185,770
March
June
1594.20
1598.30
1604.90
1607.50
1582.80
1585.40
1585.00 –12.40
1588.40 –12.00
22,509
5,079
March
June
1534.40
1537.40
1536.50
1537.40
1522.00
t 1525.50
1524.00 –10.70
1527.10 –10.00
362
22
March
June
89.69
89.22
89.88
89.43
89.54
89.10
Mini Russell 1000 (ICE-US)-$100 x index
U.S. Dollar Index (ICE-US)-$1,000 x index
0.8225
0.9366
2.660
2.650
2.830
2.130
2.180
2.460
2.570
63.100
12.400
Propane,tet,Mont Belvieu-g
Butane,normal,Mont Belvieu-g
NaturalGas,HenryHub-i
NaturalGas,TranscoZone3-i
NaturalGas,TranscoZone6NY-i
NaturalGas,PanhandleEast-i
NaturalGas,Opal-i
NaturalGas,MarcellusNE PA-i
NaturalGas,HaynesvilleN.LA-i
Coal,C.Aplc.,12500Btu,1.2SO2-r,w
Coal,PwdrRvrBsn,8800Btu,0.8SO2-r,w
89.69
89.23
.04
.03
21,261
13,703
Source: SIX Financial Information
16.6050
12214
Other metals
LBMA Platinum Price PM
*967.0
Platinum,Engelhard industrial
968.0
Platinum,Engelhard fabricated
1068.0
Palladium,Engelhard industrial
1004.0
Palladium,Engelhard fabricated
1104.0
Aluminum, LME, $ per metric ton
*2080.0
Copper,Comex spot
3.1400
Iron Ore, 62% Fe CFR China-s
71.8
Shredded Scrap, US Midwest-s,m
366
Steel, HRC USA, FOB Midwest Mill-s
853
Metals
Fibers and Textiles
Gold, per troy oz
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
1325.90
1425.34
1323.55
1469.14
*1318.70
*1322.75
1378.36
1391.62
1391.62
1605.97
1302.11
1391.62
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
Grains and Feeds
16.5700
19.8840
16.5600
20.7000
£11.8800
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA spot price
0.6200
0.8244
*92.60
n.a.
n.a.
n.a.
101
3.5500
106.2
537.2
325
98
263
2.8575
25.50
8.3263
374.90
Barley,top-quality Mnpls-u
Bran,wheat middlings, KC-u
Corn,No. 2 yellow,Cent IL-bp,u
Corn gluten feed,Midwest-u,w
Corn gluten meal,Midwest-u,w
Cottonseed meal-u,w
Hominy feed,Cent IL-u,w
Meat-bonemeal,50% pro Mnpls-u,w
Oats,No.2 milling,Mnpls-u
Rice, Long Grain Milled, No. 2 AR-u,w
Sorghum,(Milo) No.2 Gulf-u
SoybeanMeal,Cent IL,rail,ton48%-u
Wednesday
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
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
Return on investment and spreads over Treasurys and/or yields paid to investors compared with 52-week
highs and lows for different types of bonds
Total
return
close
YTD total
return (%)
Yield (%)
Latest Low High
Index
-1.9
2724.61
-2.7
U.S. Corporate
2576.89
-1.6
Intermediate
555.80
703.87
Long term
-2.2
Double-A-rated
-2.5
-1.6
Mortgage-Backed
1920.13
-1.7
Ginnie Mae (GNMA) 3.350 2.630 3.400
3.760 3.030 3.780
1148.62
-1.5
Fannie mae (FNMA) 3.350 2.670 3.400
3.450 2.530 3.450
1769.25
-1.5
Freddie Mac (FHLMC) 3.360 2.680 3.410
4.440 3.990 4.620
514.89
-1.4
Muni Master
2.489 1.736 2.494
3.230 2.470 3.250
357.61
-2.2
7-12 year
2.609 1.744 2.611
4.030 3.340 4.040
403.71
-2.0
12-22 year
Triple-B-rated
2.886 2.213 2.899
391.81
-2.1
22-plus year
3.279 2.716 3.415
High Yield Bonds Merrill Lynch
415.24
-0.6
High Yield Constrained 6.259 5.373 6.394
1.3
425.61
2835.54
-0.9
Triple-C-rated
High Yield 100
Crude oil and
petroleum prod
Crude oil
excluding SPR
Gasoline
Finished gasoline
Reformulated
Conventional
Blend. components
1,198,052
...
1,203 1,339
1,201
5-year
avg
10.434 9.640 11.091
540.85
-0.6
6.090 4.948 6.319
753.39
-0.2
Global Government 1.550 1.300 1.650
0.4
1,202
...
9,582
2,500
...
-800
...
...
...
426
251
25
0
25
226
528
246
25
0
25
222
425
249
25
0
25
224
460
232
33
0
33
199
7,585
604
11
0
11
593
...
...
...
...
...
...
1,625
...
2
2
2
2
...
...
...
41,582
133,066
10,470
122,595
33,416
251,201
...
-1,100
...
...
...
...
43
137
12
126
33
249
42
157
12
146
39
259
43
137
12
125
32
250
40
134
14
120
40
231
99
223
31
192
221
707
...
...
...
...
...
...
274
265
1
221
207
1,029
Net crude, petroleum
products, incl. SPR
1,863,510
...
1,868 2,033
1,866
1,897
2,933
...
Kerosene-type
jet fuel
Distillates
Heating oil
Diesel
Residual fuel oil
Other oils
Current
Total petroleum
product
20,931
...
20,470
Year
ago
19,464
4-week
avg
5-year
avg
9,553
8,003 7,405
608 572
6
36
0
0
6
36
602 536
9,796
7,473
502
21
0
21
481
7,972
463
35
0
35
429
...
...
...
126
79
23
56
242
982
127
235
22
198
213
837
97
204
70
134
218
718
4,184 3,873
3,185
5,582
5-year
avg
Global High Yield Constrained 5.591 4.934 5.681
371.83
-0.1
Europe High Yield Constrained 2.700 1.897 3.196
709.92
-0.1
France
0.910 0.690 1.190
505.08
-0.4
Germany
0.600 0.210 0.740
Japan
0.380 0.340 0.460
U.S Agency Bloomberg Barclays
1623.69
-0.8
U.S Agency
2.580 1.690 2.610
289.65
1454.58
-0.5
10-20 years
2.460 1.490 2.480
558.03
-0.4
Netherlands
0.700 0.390 0.830
1.620 1.340 1.830
0.3
3294.33
-2.7
20-plus years
3.250 2.730 3.400
922.47
-0.9
U.K.
2420.34
-1.7
Yankee
3.420 2.610 3.440
791.33
-2.1
Emerging Markets ** 5.993 5.279 6.077
3250
...
9,276
9,254
9,195
8,945
jet fuel
Distillates
Residual fuel oil
Propane/propylene
Other oils
1,891
3,832
249
1,548
3,769
...
...
...
...
...
1,853
3,926
257
1,622
3,536
1,820
4,409
431
889
2,662
1,781
3,976
278
1,468
3,735
1,462
3,810
269
...
...
Five-year average
for each week
Natural gas,
lower 48 states
t
9,642
t
motor gasoline
Kerosene-type
2250
1250
250
M A M J
2017
J A S O N D
J F
2018
Note: Expected changes are provided by Dow Jones Newswires' survey of analysts. Previous and average inventory data are in millions.
Sources: SIX Financial Information via WSJ Market Data Group; U.S. Energy Information Administration; Dow Jones Newswires
Exchange-Traded Portfolios | WSJ.com/ETFresearch
Largest 100 exchange-traded funds, latest session
ETF
Wednesday, March 14, 2018
Closing Chg YTD
Symbol Price (%) (%)
AlerianMLPETF
CnsmrDiscSelSector
CnsStapleSelSector
EnSelectSectorSPDR
FinSelSectorSPDR
GuggS&P500EW
HealthCareSelSect
IndSelSectorSPDR
iShIntermCredBd
iSh1-3YCreditBond
iSh3-7YTreasuryBd
iShCoreMSCIEAFE
iShCoreMSCIEmgMk
iShCoreMSCITotInt
iShCoreS&P500
iShCoreS&P MC
iShCoreS&P SC
iShS&PTotlUSStkMkt
iShCoreUSAggBd
iShSelectDividend
iShEdgeMSCIMinEAFE
iShEdgeMSCIMinUSA
iShEdgeMSCIUSAMom
iShFloatingRateBd
iShGoldTr
iShiBoxx$InvGrCpBd
iShiBoxx$HYCpBd
iShJPMUSDEmgBd
iShMBSETF
iShMSCI ACWI
iShMSCIBrazil
AMLP
XLY
XLP
XLE
XLF
RSP
XLV
XLI
CIU
CSJ
IEI
IEFA
IEMG
IXUS
IVV
IJH
IJR
ITOT
AGG
DVY
EFAV
USMV
MTUM
FLOT
IAU
LQD
HYG
EMB
MBB
ACWI
EWZ
10.26
105.71
53.91
67.54
28.94
102.72
85.83
76.26
107.00
103.70
120.25
66.66
59.69
64.02
277.34
193.21
79.47
63.08
106.75
96.92
74.20
53.16
111.36
50.95
12.72
116.51
85.56
112.33
104.36
73.71
45.70
–1.63
–0.12
–1.01
–0.59
–1.13
–0.60
–0.49
–1.09
0.08
0.01
0.08
0.29
0.27
0.23
–0.51
–0.50
–0.48
–0.47
0.17
–0.45
0.23
–0.43
–0.54
...
–0.08
0.22
–0.12
0.22
0.10
–0.20
–0.15
–4.9
7.1
–5.2
–6.5
3.7
1.7
3.8
0.8
–2.0
–0.8
–1.6
0.9
4.9
1.5
3.2
1.8
3.5
3.2
–2.4
–1.7
1.7
0.7
8.0
0.3
1.7
–4.2
–1.9
–3.2
–2.1
2.2
13.0
ETF
ETF
Closing Chg YTD
Symbol Price (%) (%)
iShMSCI EAFE
iShMSCI EAFE SC
iShMSCIEmgMarkets
iShMSCIEurozone
iShMSCIJapan
iShNasdaqBiotech
iShNatlMuniBd
iShRussell1000Gwth
iShRussell1000
iShRussell1000Val
iShRussell2000Gwth
iShRussell2000
iShRussell2000Val
iShRussell3000
iShRussellMid-Cap
iShRussellMCValue
iShS&PMC400Growth
iShS&P500Growth
iShS&P500Value
iShUSPfdStk
iShShortTreaBd
iShTIPSBondETF
iSh1-3YTreasuryBd
iSh7-10YTreasuryBd
iShRussellMCGrowth
PIMCOEnhShMaturity
PwrShQQQ 1
PwrShSrLoanPtf
SPDR BlmBarcHYBd
SPDR Gold
SchwabIntEquity
SchwabUS BrdMkt
SchwabUS Div
EFA
SCZ
EEM
EZU
EWJ
IBB
MUB
IWF
IWB
IWD
IWO
IWM
IWN
IWV
IWR
IWS
IJK
IVW
IVE
PFF
SHV
TIP
SHY
IEF
IWP
MINT
QQQ
BKLN
JNK
GLD
SCHF
SCHB
SCHD
70.56
66.43
49.50
44.01
60.84
113.78
108.44
143.20
153.34
124.24
198.92
157.71
125.88
163.14
212.95
88.74
224.74
163.58
113.12
37.62
110.25
112.37
83.44
102.53
127.59
101.53
171.68
23.18
35.90
125.70
34.11
66.61
50.44
0.24
0.30
0.16
0.30
0.43
–0.12
0.06
–0.33
–0.51
–0.68
–0.27
–0.47
–0.73
–0.50
–0.40
–0.48
–0.49
–0.30
–0.75
0.05
–0.01
0.17
–0.01
0.20
–0.37
...
–0.02
–0.09
–0.11
–0.06
0.26
–0.46
–0.92
0.4
3.0
5.1
1.5
1.5
6.6
–2.1
6.3
3.2
–0.1
6.5
3.4
0.1
3.1
2.3
–0.5
4.1
7.1
–1.0
–1.2
0.0
–1.5
–0.5
–2.9
5.8
–0.0
10.2
0.6
–2.2
1.7
0.1
3.2
–1.4
SchwabUS LC
SPDR DJIA Tr
SPDR S&PMdCpTr
SPDR S&P 500
SPDR S&P Div
TechSelectSector
VanEckGoldMiner
VangdInfoTech
VangdSC Val
VangdSC Grwth
VangdDivApp
VangdFTSEDevMk
VangdFTSE EM
VangdFTSE Europe
VangdFinls
VangdFTSEAWxUS
VangdGrowth
VangdHlthCr
VangdHiDiv
VangdIntermBd
VangdIntrCorpBd
VangdLC
VangdMC
VangdMC Val
VangdRealEst
VangdS&P500
VangdST Bond
VangdSTCpBd
VangdSC
VangdTotalBd
VangdTotIntlBd
VangdTotIntlStk
VangdTotalStk
VangdTotlWrld
VangdValue
WisdTrJapanHdg
Closing Chg YTD
Symbol Price (%) (%)
SCHX
DIA
MDY
SPY
SDY
XLK
GDX
VGT
VBR
VBK
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
DXJ
65.90
247.88
351.50
275.30
93.49
69.86
21.73
182.76
133.05
169.76
103.77
44.96
48.19
59.16
72.65
55.39
149.62
161.87
85.60
81.46
84.57
126.66
159.47
112.64
76.05
252.97
78.36
78.32
151.59
79.59
54.39
57.58
141.61
75.97
106.98
56.37
† In local currency § Euro-zone bonds
Sources: Merrill Lynch; Bloomberg Barclays; J.P.Morgan
Yields and spreads over or under U.S. Treasurys on benchmark two-year and 10-year government bonds in
selected other countries; arrows indicate whether the yield rose(s) or fell (t) in the latest session
Country/
Coupon (%) Maturity, in years
2.250
2.750
Australia 2
2.250
10
0.750
0.000
0.500
0.050
2.000
0.100
0.100
1.400
1.400
0
1
U.S. 2 2.258 t
10 2.816 t
4.500
0.000
Latest(l)-2 -1
l
l
1.996 t
2.750 t
l
l
France 2 -0.475 t
10 0.835 t
l
Germany 2 -0.584 t
10 0.596 t
l
l
l
Italy 2 -0.251 t
10 2.015 s
l
Japan 2 -0.146 s
10 0.051 t
l
Spain 2 -0.280 t
10 1.384 t
l
2.000
U.K. 2
4.250
10
Yield (%)
3 4 Previous
2
l
l
l
0.795 t
1.442 t
l
l
Spread Under/Over U.S. Treasurys, in basis points
Latest
Prev
Year ago
Month ago
Year ago
2.258
2.845
2.168
2.906
1.385
2.602
2.037
1.994
1.890
-26.2
-22.1
50.5
2.817
2.840
2.931
-6.5
-2.8
32.9
-0.470
-0.414
-186.8
0.994
-0.484 -273.3
1.100
-198.1
-272.8
0.863
-198.2
-150.3
-0.569
-0.573
-282.7
-219.3
0.619
0.758
-0.809 -284.2
0.447
-221.9
-222.6
-215.5
-0.239
-0.198
0.029
-250.9
-249.7
-135.5
1.989
2.061
2.358
-80.1
-85.6
-24.5
-0.148
-0.148
-0.257
-240.4
-240.6
-164.1
-279.4
-251.2
-252.7
-148.1
0.051
0.065
-0.269
-0.367
-0.096
0.090 -276.5
1.387
1.503
1.870
-143.2
-145.7
-73.3
0.841
0.712
0.072
-146.3
-141.7
-131.2
1.488
1.643
1.226
-137.4
-135.7
-137.6
-253.8
Source: Tullett Prebon
Investment-grade spreads that tightened the most…
4250
20,432 18,898
1.160 0.956 1.337
-0.4
306.11
in that same company’s share price.
Billions of cubic feet; weekly totals
Finished
2.180 1.570 2.340
Corporate Debt
Natural gas storage
Weekly Demand, 000s barrels per day
Expected Previous
change
week
4-week
avg
10,587 9,558
430,928
244,758
24,215
41
24,174
220,543
Natural gas (bcf)
Year
ago
Canada
EMU§
377.53
** EMBI Global Index
Expected Previous
change
week
Current
3.350 2.660 3.400
Global Government J.P. Morgan†
Global Government Bonds: Mapping Yields
4-week
avg
Yield (%)
Latest Low High
Index
1957.31
3.150 2.380 3.180
U.S. Aggregate
3748.39 -4.8
YTD total
return (%)
Mortgage-Backed Bloomberg Barclays
Broad Market Bloomberg Barclays
1908.11
Total
return
close
Inventories, imports and demand for the week ended March 9. Current figures are in thousands of barrels or
thousands of gallons per day, except natural-gas figures, which are in billions of cubic feet. Natural-gas import
Natural-gas import and demand data are available monthly only.
Inventories, 000s barrels
Imports, 000s barrels per day
Year
ago
29.6500
0.2225
n.a.
0.3006
0.2600
n.a.
Bonds | WSJ.com/bonds
Tracking Bond Benchmarks
*Constrained indexes limit individual issuer concentrations to 2%; the High Yield 100 are the 100 largest bonds
Expected Previous
change
week
201.35
193.75
0.9396
2.2175
152.50
157.50
69.00
2752
1.2106
1.4087
1.9550
16.15
n.a.
64.48
n.a.
0.9239
127.00
169.88
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
Macro & Market Economics
Watching the Gauges: U.S. Supply and Demand
Current
9.8100
7.7175
4.6400
n.a.
5.5400
KEY TO CODES: A=ask; B=bid; BP=country elevator bids to producers; C=corrected; E=Manfra,Tordella & Brooks; G=ICE; H=Hurley Brokerage; I=Natural Gas Intelligence;
M=monthly; N=nominal; n.a.=not quoted or not available; R=SNL Energy; S=Platts-TSI; T=Cotlook Limited; U=USDA; W=weekly, Z=not quoted. *Data as of 3/13
Source: WSJ Market Data Group
U.S. Corporate Indexes Bloomberg Barclays
Mini DJ Industrial Average (CBT)-$5 x index
March
June
Wednesday
(U.S.$ equivalent)
Coins,wholesale $1,000 face-a
Energy
Silver, troy oz.
Canadian Dollar (CME)-CAD 100,000; $ per CAD
383.50
388.75
Wednesday, March 14, 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.
2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100%
180,109
439,145
328,519
144,292
239,766
121,760
384.25
388.00
9,351
1,743
March
June
Treasury Notes (CBT)-$100,000; pts 32nds of 100%
402
143,589
386.50 s
393.25
Cash Prices
.46 125,854
–.47 70,923
Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
57,239
21,522
386.50
391.00
3,203
2,682
Interest Rate Futures
23,754
1,004
March
May
Open
interest
Chg
Orange Juice (ICE-US)-15,000 lbs.; cents per lb.
Agriculture Futures
Oats (CBT)-5,000 bu.; cents per bu.
Settle
Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb.
Metal & Petroleum Futures
Corn (CBT)-5,000 bu.; cents per bu.
Contract
High hilo
Low
Open
WSJ.com/commodities
–0.50
–0.94
–0.52
–0.51
–0.55
–0.09
0.28
0.02
–0.71
–0.25
–0.90
0.16
0.12
0.20
–1.16
0.22
–0.29
–0.49
–0.70
0.14
0.14
–0.50
–0.44
–0.60
0.09
–0.53
0.04
–0.03
–0.55
0.21
0.22
0.26
–0.51
–0.11
–0.71
0.20
3.3
0.2
1.8
3.2
–1.0
9.2
–6.5
10.9
0.2
5.5
1.7
0.2
5.0
0.0
3.7
1.2
6.4
5.0
–0.0
–2.8
–3.2
3.3
3.0
1.0
–8.4
3.1
–0.9
–1.2
2.6
–2.4
0.0
1.4
3.2
2.3
0.6
–5.0
Maturity
Last week
Stock Performance
Close ($)
% chg
Symbol Coupon (%)
Scripps Networks Interactive
Pacific Gas & Electric
Shell International Finance Bv*
Apple
SNI
PCG
RDSALN
AAPL
3.500 June 15, ’22
6.050 March 1, ’34
2.125 May 11, ’20
2.700 May 13, ’22
95
131
47
32
–15
–13
–12
–8
98
141
46
n.a.
...
44.17
...
178.44
...
–2.06
...
–0.85
Qualcomm
Microsoft
Brighthouse Financial
Cisco Systems
QCOM
MSFT
BHF
CSCO
2.100
1.550
3.700
5.500
55
34
176
76
–8
–7
–6
–6
82
35
178
71
60.12
93.85
52.68
45.28
0.70
–0.59
–1.46
0.27
May 20, ’20
Aug. 8, ’21
June 22, ’27
Jan. 15, ’40
Current
Spread*, in basis points
One-day change
Issuer
…And spreads that widened the most
Kohls
General Electric
Allergan Funding SCS
Celgene
KSS
GE
AGN
CELG
3.250
Feb. 1, ’23
5.300 Feb. 11, ’21
4.750 March 15, ’45
5.000 Aug. 15, ’45
96
109
204
171
18
17
17
28
94
88
180
n.a.
62.25
14.27
167.06
91.61
–2.90
–1.11
2.37
0.05
Deutsche Bank AG
JPMorgan Chase
Time Warner
Eaton
DB
JPM
TWX
ETN
7.500 April 30, ’49
2.972 Jan. 15, ’23
3.600 July 15, ’25
3.103 Sept. 15, ’27
369
81
143
100
17
17
17
16
362
n.a.
116
89
15.70
114.95
96.40
80.09
–0.57
–1.12
0.25
–1.46
Bond Price as % of face value
Current
One-day change
Last week
High-yield issues with the biggest price increases…
Maturity
Stock Performance
Close ($)
% chg
Issuer
Symbol
Coupon (%)
L Brands
CHS/Community Health Systems
Rayonier A.M. Products
Everi Payments
LB
CYH
RYAM
EVRI
5.250
7.125
5.500
7.500
Feb. 1, ’28
July 15, ’20
June 1, ’24
Dec. 15, ’25
97.375
80.563
99.000
102.500
2.13
1.56
0.88
0.75
95.450
82.250
98.625
101.780
41.30
4.43
19.59
7.61
–1.43
–1.34
–2.54
0.26
Uniti
Valeant Pharmaceuticals International
Herc Rentals
B&G Foods
UNIT
VRXCN
HERCRE
BGS
7.125
9.000
7.500
4.625
Dec. 15, ’24
Dec. 15, ’25
June 1, ’22
June 1, ’21
92.250
100.250
107.563
99.625
0.75
0.63
0.56
0.50
89.875
100.563
n.a.
99.750
17.03
...
...
27.85
0.53
...
...
3.92
…And with the biggest price decreases
CSC Holdings
California Resources
Teck Resources
Teva Pharmaceutical Finance
CVC
CRC
TCKBCN
TEVA
6.625 Oct. 15, ’25
8.000 Dec. 15, ’22
6.125
Oct. 1, ’35
6.750 March 1, ’28
94.000 –10.38
76.500
106.250
100.250
–1.50
–1.50
–1.38
104.390
78.750
107.764
n.a.
...
14.71
...
18.57
...
2.80
...
–3.88
Rowan
Harland Clarke Holdings
iHeart Communications
RDC
HARCLA
IHRT
7.375 June 15, ’25
8.375 Aug. 15, ’22
9.000 March 1, ’21
95.095
101.750
81.750
–1.28
–1.25
–1.25
96.750
102.470
82.750
12.11
...
...
2.37
...
...
*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
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | B9
BIGGEST 1,000 STOCKS
How to Read the Stock Tables
The following explanations apply to NYSE,
NYSE Arca, NYSE American and Nasdaq Stock
Market listed securities. Prices are composite
quotations that include primary market trades
as well as trades reported by Nasdaq BX
(formerly Boston), Chicago Stock Exchange,
Cboe, NYSE National and Nasdaq ISE.
The list comprises the 1,000 largest
companies based on market capitalization.
Underlined quotations are those stocks with
large changes in volume compared with the
issue’s average trading volume.
Boldfaced quotations highlight those issues
whose price changed by 5% or more if their
previous closing price was $2 or higher.
Footnotes:
s-New 52-week high.
t-New 52-week low.
dd-Indicates loss in the most recent
four quarters.
FD-First day of trading.
h-Does not meet continued listing
standards
lf-Late filing
q-Temporary exemption from Nasdaq
requirements.
t-NYSE bankruptcy
v-Trading halted on primary market.
vj-In bankruptcy or receivership or
being reorganized under the
Bankruptcy Code, or securities
assumed by such companies.
Wall Street Journal stock tables reflect composite regular trading as of 4 p.m. and
changes in the closing prices from 4 p.m. the previous day.
Net
Wednesday, March 14, 2018
Stock
Stock
Net
Sym Close Chg
Sym Close Chg
Net
Stock
Sym Close Chg
A B C
D E F
Wednesday, March 14, 2018
52-Wk %
Sym Hi/Lo Chg Stock
26.16 ...
15.60 4.9
23.93 1.9
43.95 -1.5
68.85 -0.5
181.45 -2.6
30.15 7.7
7.43 1.5
11.60 3.6
43.80 0.8
25.59 12.6
54.99 311.2
17.53 5.3
8.00 -2.1
36.15 1.6
20.73 0.4
37.39 0.8
94.05 3.5
9.90 3.6
31.40 4.0
36.13 11.2
285.00 0.3
14.43 9.6
22.55 1.2
15.45 1.1
368.33 0.4
6.99 10.6
66.20 -0.2
17.99 0.5
130.95 -2.0
141.76 0.1
12.66 -0.3
4.44 6.8
28.54 1.6
22.05 3.9
52-Wk %
Sym Hi/Lo Chg Stock
FirstUnited
FUNC
FirstCash
FCFS
FirsthandTechVal SVVC
FlowersFoods FLO
FortressBiotech FBIO
FuelTech
FTEK
G1Therapeutics GTHX
Gaia
GAIA
GlobalPayments GPN
GordonPointeWt GPAQW
GordonPointeUn GPAQU
GoresII Un
GSHTU
Haemonetic
HAE
HailiangEduc
HLG
HanoverIns
THG
HealthEquity HQY
Heico
HEI
HeritageCommerce HTBK
HeronTherap HRTX
HighwayHldgs HIHO
HiltonGrandVac HGV
InfuSystems
INFU
Insulet
PODD
IntegerHoldings ITGR
IntegraLifeSci IART
InterParfums IPAR
IntlGameTech IGT
JasonIndustries JASN
JonesLang
JLL
JuniperPharm JNP
KBLMergerIV Wt KBLMW
KaziaTherap
KZIA
KinsaleCapital KNSL
LivePerson
LPSN
MIAcquisitionsUn MACQU
MI Acqns Wt MACQW
MillAcqn Wt
MIIIW
MatchGroup
MTCH
Mutual Funds
20.25
81.25
12.56
21.57
5.54
1.83
39.42
16.40
118.34
0.57
10.29
10.70
75.45
67.80
119.22
60.00
90.81
17.28
25.35
4.80
47.75
2.50
85.44
57.45
57.14
48.98
30.82
3.50
173.94
11.60
0.30
6.68
54.34
16.01
12.95
0.94
1.05
46.81
0.8
-0.2
5.2
0.6
0.8
-0.6
0.4
8.4
0.5
...
...
0.5
-0.2
3.7
0.3
1.9
2.2
0.6
-7.7
-1.1
2.6
-0.5
-0.3
1.6
-0.2
1.1
2.7
1.5
-0.7
3.6
10.7
4.8
-0.7
-0.6
16.6
7.2
13.5
3.0
52-Wk %
Sym Hi/Lo Chg
Materion
MTRN
MongoDB
MDB
MTechAcqnWt MTECW
MudrickCap
MUDSU
MudrickCapA MUDS
MuleSoft
MULE
MyovantSciences MYOV
NRG Energy
NRG
Navistar pfD NAVpD
Neogen
NEOG
NetApp
NTAP
Nutanix
NTNX
Orgenesis
ORGS
OrthofixIntl
OFIX
PRGXGlobal
PRGX
PaycomSoftware PAYC
Penumbra
PEN
PlayAGS
AGS
PPlus GSC-2
PYT
ProfireEnergy PFIE
Progressive
PGR
ProPhaseLabs PRPH
ProtoLabs
PRLB
PurpleInnovation PRPL
RF Industries RFIL
R1RCM
RCM
RadNet
RDNT
RecroPharma REPH
RiceBranTech RIBT
RingCentral
RNG
RylBkScot pfS RBSpS
Salesforce.com CRM
SempraEnerPfdA SREpA
ServiceNow
NOW
ShotSpotter
SSTI
SodaStream
SODA
SolarEdgeTech SEDG
Splunk
SPLK
54.90
41.50
0.70
10.27
9.60
34.90
19.88
30.41
19.76
64.44
65.58
54.98
13.95
60.52
9.50
112.21
124.85
21.99
21.93
2.91
61.63
3.21
123.70
13.05
5.50
7.84
13.40
11.60
1.66
68.55
27.63
128.87
103.45
176.56
22.45
90.28
55.55
109.88
-0.9
7.4
...
0.1
0.1
2.3
-0.7
0.7
-1.6
0.3
-0.4
3.1
23.9
-1.0
-4.3
1.6
-0.4
3.0
0.7
6.7
2.3
6.6
1.1
5.3
37.7
2.4
2.4
5.6
7.3
3.0
0.1
1.0
1.5
0.8
1.1
1.6
1.2
2.1
Data provided by
e-Ex-distribution. f-Previous day’s quotation. g-Footnotes x and s apply. j-Footnotes e
and s apply. k-Recalculated by Lipper, using updated data. p-Distribution costs apply,
12b-1. r-Redemption charge may apply. s-Stock split or dividend. t-Footnotes p and r
apply. v-Footnotes x and e apply. x-Ex-dividend. z-Footnote x, e and s apply. NA-Not
available due to incomplete price, performance or cost data. NE-Not released by Lipper;
data under review. NN-Fund not tracked. NS-Fund didn’t exist at start of period.
Fund
Wednesday, March 14, 2018
Net YTD
Net YTD
NAV Chg %Ret Fund
American Century Inv
47.16 -0.07
Ultra
American Funds Cl A
33.95 -0.09
AmcpA p
AMutlA p 41.11 -0.24
27.21 -0.17
BalA p
BondA p
12.61 +0.01
CapIBA p
61.72 -0.57
CapWGrA 52.86 -0.16
58.19 +0.20
EupacA p
64.11 -0.31
FdInvA p
53.43 -0.09
GwthA p
10.27 -0.01
HI TrA p
41.71 -0.17
ICAA p
23.03 -0.25
IncoA p
45.90 -0.02
N PerA p
49.47 +0.01
NEcoA p
NwWrldA 69.66 +0.04
SmCpA p
58.14 -0.11
12.78
...
TxExA p
46.22 -0.33
WshA p
NAV Chg %Ret Fund
Baird Funds
8.6 AggBdInst 10.63 +0.02
CorBdInst 10.98 +0.02
7.8 BlackRock Funds A
0.8 GlblAlloc p 19.93 -0.02
0.6 BlackRock Funds Inst
22.83 -0.15
-1.8 EqtyDivd
20.06 -0.02
-1.0 GlblAlloc
7.70 -0.01
3.8 HiYldBd
3.5 StratIncOpptyIns 9.95 -0.01
3.1 Bridge Builder Trust
NA
...
7.9 CoreBond
0.1 Dimensional Fds
...
3.3 5GlbFxdInc 10.80
-0.7 EmgMktVa 32.51 -0.05
6.3 EmMktCorEq 24.09 -0.01
...
10.8 IntlCoreEq 14.60
20.36
...
4.1 IntlVal
21.58 -0.01
4.2 IntSmCo
22.89
...
-1.4 IntSmVa
1.2 US CoreEq1 23.49 -0.14
Square
SQ
St.Joe
JOE
TejonRanch
TRC
TopBuild
BLD
Twitter
TWTR
UsanaHealth USNA
VeriSign
VRSN
WNS
WNS
Watsco
WSO
WestAllianceBcp WAL
WillisLease
WLFC
WillScotWt
WSCWW
Worldpay
WP
XO Group
XOXO
Zendesk
ZEN
Zillow A
ZG
Zillow C
Z
Net YTD
NAV Chg %Ret
US CoreEq2 22.09 -0.15 2.5
-1.8 US Small
36.51 -0.24 1.6
-1.7 US SmCpVal 38.18 -0.27 0.7
US TgdVal 25.07 -0.22 0.7
1.2 USLgVa
39.55 -0.34 1.1
Dodge & Cox
0.3 Balanced
108.37 -0.43 1.3
1.3 GblStock
14.10 -0.07 1.7
-0.2 Income
13.62 +0.01 -1.0
0.6 Intl Stk
47.06 -0.15 1.6
209.11 -1.37 2.7
Stock
NA DoubleLine Funds
TotRetBdI
NA
... NA
-0.6 Edgewood Growth Instituti
4.1 EdgewoodGrInst 33.07 +0.09 11.9
3.7 Federated Instl
0.4 StraValDivIS 5.78 -0.03 -5.6
-0.6 Fidelity
1.5 500IdxInst 96.50 -0.53 3.3
-0.3 500IdxInstPrem 96.50 -0.53 3.3
3.1 500IdxPrem 96.50 -0.53 3.3
54.84
19.95
24.43
81.48
36.80
82.40
125.07
46.53
183.84
62.49
29.88
1.70
85.53
22.18
49.42
58.74
58.93
5.4
0.3
0.2
1.5
7.3
1.8
2.1
0.9
0.5
-3.2
-0.6
2.4
-0.7
2.4
5.8
2.3
2.4
Lows
ADT
ADT
ALJ Regional ALJJ
ActiniumPharm ATNM
AlioGold
ALO
Amedica
AMDA
AIG
AIG
ArchCapital
ACGL
AutoWeb
AUTO
AvadelPharm AVDL
B.Riley7.25%Nts RILYG
BlueknightEnPtrsA BKEPP
CGG
CGG
CedarRealty
CDR
CellcomIsrael CEL
ChesapeakeGranite CHKR
Christopher&Banks CBK
CinnBell pfB
CBBpB
CooperT&R
CTB
Corts Aon KTN KTN
Crawford B
CRD.B
DareBioscience DARE
DigitalRealtyPfH DLRpH
EV Energy
EVEP
EnergyTransferEq ETE
EnvivaPartners EVA
ExxonMobil
XOM
Fund
Top 250 mutual-funds listings for Nasdaq-published share classes with net assets of
at least $500 million each.
0.26
-0.53
0.25
-0.25
0.43
-0.38
-1.12
-0.30
-1.66
-0.16
-0.18
-0.32
-0.39
-0.16
-1.35
-0.09
-0.02
-0.62
-0.02
0.63
0.77
0.13
-4.10
-0.31
Net
Sym Close Chg
Stock
Graco
GGG 46.40
Grainger
GWW 280.21
GreatPlainsEner GXP 30.36
Grifols
GRFS 21.46
GrubHub
GRUB 110.78
GpoAvalAcc AVAL 8.66
GpoFinGalicia GGAL 65.40
t GrupoTelevisa TV 16.41
Guidewire GWRE 86.72
HCA Healthcare HCA 101.93
HCP
HCP 22.95
HDFC Bank HDB 98.51
HD Supply HDS 38.01
HP
HPQ 23.48
HSBC
HSBC 48.73
Halliburton HAL 46.24
Hanesbrands HBI 19.38
t HarleyDavidson HOG 43.46
Harris
HRS 157.58
HartfordFinl HIG 53.87
t Hasbro
HAS 88.53
Heico A
HEI.A 71.35
s Heico
HEI 90.07
Helm&Payne HP 64.61
HenrySchein HSIC 68.30
Herbalife
HLF 98.70
Hershey
HSY 101.68
Hess
HES 48.57
HewlettPackard HPE 18.85
Hexcel
HXL 67.05
Hilton
HLT 81.24
HollyFrontier HFC 46.27
Hologic
HOLX 38.44
HomeDepot HD 177.41
HondaMotor HMC 34.60
Honeywell HON 150.42
HormelFoods HRL 33.72
DR Horton DHI 44.39
HostHotels HST 18.92
HowardHughes HHC 136.05
HuanengPower HNP 26.50
Hubbell
HUBB 126.33
Humana
HUM 270.50
JBHunt
JBHT 119.81
HuntingtonBcshs HBAN 16.05
HuntingIngalls HII 255.51
Huntsman HUN 31.48
HyattHotels H
80.95
IAC/InterActive IAC 162.19
ICICI Bank IBN 9.40
IdexxLab
IDXX 203.58
IHSMarkit INFO 48.84
ING Groep ING 17.42
Invesco
IVZ 33.27
IPG Photonics IPGP 253.28
IQVIA
IQV 104.84
IRSA Prop IRCP 44.34
IcahnEnterprises IEP 57.99
Icon
ICLR 121.72
IDEX
IEX 146.89
IllinoisToolWks ITW 169.34
Illumina
ILMN 251.79
ImperialOil IMO 26.40
Incyte
INCY 92.26
Infosys
INFY 18.38
Ingersoll-Rand IR
88.32
Ingredion
INGR 132.34
Intel
INTC 51.86
InteractiveBrkrs IBKR 71.84
ICE
ICE 74.31
InterContinentl IHG 63.55
IBM
IBM 158.12
IntlFlavors IFF 139.29
s IntlGameTech IGT 30.74
IntlPaper
IP
54.75
Interpublic IPG 23.44
Intuit
INTU 177.29
IntuitiveSurgical ISRG 440.77
InvitatHomes INVH 22.61
IonisPharma IONS 53.57
IronMountain IRM 32.98
IsraelChemicals ICL
4.57
ItauUnibanco ITUB 15.79
J K L
JD.com
JD 44.09
JPMorganChase JPM 114.95
JackHenry JKHY 125.01
JacobsEngg JEC 59.78
JamesHardie JHX 17.75
JanusHenderson JHG 35.50
JazzPharma JAZZ 150.74
JetBlue
JBLU 22.34
J&J
JNJ 132.32
JohnsonControls JCI 37.22
s JonesLang JLL 171.85
JuniperNetworks JNPR 26.20
KAR Auction KAR 55.75
KB Fin
KB 57.68
KKR
KKR 22.12
KLA Tencor KLAC 120.44
KT
KT 13.53
KSCitySouthern KSU 106.69
Kellogg
K
69.00
KeyCorp
KEY 20.92
KeysightTechs KEYS 53.58
KilroyRealty KRC 70.54
KimberlyClark KMB 111.08
KimcoRealty KIM 14.59
KinderMorgan KMI 16.42
Knight-Swift KNX 48.93
Kohl's
KSS 62.25
KoninklijkePhil PHG 38.91
KoreaElcPwr KEP 15.14
t KraftHeinz KHC 66.58
Kroger
KR 23.44
Kyocera
KYO 57.51
LATAMAirlines LTM 16.14
L Brands
LB 41.30
LG Display LPL 13.06
LINE
LN 40.37
52-Wk %
Sym Hi/Lo Chg Stock
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.
ACI Worldwide ACIW
ACM Research ACMR
Acushnet
GOLF
AddusHomeCare ADUS
AlbanyIntl
AIN
AllegiantTravel ALGT
AllianceOne
AOI
Ambev
ABEV
Ameresco
AMRC
AmericanPubEdu APEI
ApellisPharm APLS
ArcadiaBiosci RKDA
AsureSoftware ASUR
Atomera
ATOM
AxoGen
AXGN
BluegreenVac BXG
BlueLinx
BXC
CalavoGrowers CVGW
CambiumLearning ABCD
CasaSystems CASA
Cellectis
CLLS
Chemed
CHE
ChemoCentryx CCXI
CoastwayBancorp CWAY
ColonyBankcorp CBAN
CoStar
CSGP
CryoPortWt
CYRXW
Cubic
CUB
CueBiopharma CUE
D&B
DNB
EdwardsLife
EW
eHiCarServices EHIC
EnphaseEnergy ENPH
Etsy
ETSY
FibriaCelulose FBR
-0.20
1.95
-0.18
0.17
0.47
-0.33
-1.61
0.52
0.81
-0.14
0.08
-1.62
-1.58
0.16
0.53
0.10
-0.05
-0.16
0.04
-0.21
0.17
0.21
-1.38
-1.30
-1.19
-0.58
0.01
-0.52
0.13
1.75
0.17
-0.01
1.40
-0.49
-0.12
0.20
0.15
0.07
0.01
0.04
-0.18
-0.19
0.41
-0.40
-0.55
8.29
0.06
0.17
0.03
0.62
-0.69
-1.40
0.51
0.07
0.39
3.75
-1.16
-0.30
-0.97
-0.93
0.08
-1.09
2.31
-1.13
-0.39
0.13
-3.86
-0.85
-0.15
0.82
-0.36
-0.09
-0.44
1.64
-0.46
0.39
-0.17
-1.23
0.37
0.43
0.09
0.10
-0.41
-0.72
-0.33
-0.01
0.24
0.29
0.01
-0.38
-0.87
-0.43
-0.56
0.18
-0.48
G H I
New Highs and Lows | WSJ.com/newhighs
Highs
DiscovComm C DISCK 22.25
DiscovComm B DISCB 34.25
DiscovComm A DISCA 24.07
Disney
DIS 103.90
DolbyLab
DLB 67.76
DollarGeneral DG 89.20
DollarTree DLTR 92.81
DominionEner D
73.52
Domino's
DPZ 226.66
Donaldson DCI 45.23
DouglasEmmett DEI 37.39
Dover
DOV 99.00
DowDuPont DWDP 68.99
DrPepperSnap DPS 117.81
DukeEnergy DUK 77.00
DukeRealty DRE 25.70
ENI
E
34.05
EOG Rscs EOG 99.89
EPAM Systems EPAM 121.83
EQT
EQT 52.45
E*TRADE ETFC 57.16
EXACT Sci EXAS 52.76
EastWestBncp EWBC 65.31
EastmanChem EMN 107.49
Eaton
ETN 80.09
EatonVance EV 56.75
eBay
EBAY 42.83
Ecolab
ECL 136.31
Ecopetrol
EC 17.67
EdisonInt
EIX 63.81
s EdwardsLife EW 141.00
ElbitSystems ESLT 137.93
ElectronicArts EA 127.97
EmersonElec EMR 70.74
EnbridgeEnPtrs EEP 13.10
Enbridge
ENB 33.09
Encana
ECA 11.10
EnelAmericas ENIA 11.55
EnelChile
ENIC 6.34
EnelGenChile EOCC 28.42
t EnergyTransferEq ETE 15.16
EnergyTransfer ETP 17.72
Entergy
ETR 77.50
EnterpriseProd EPD 25.63
Equifax
EFX 123.19
Equinix
EQIX 413.71
EquityLife ELS 85.64
EquityResdntl EQR 59.54
Ericsson
ERIC 6.78
EssexProp ESS 238.67
EsteeLauder EL 145.09
EverestRe RE 260.37
EversourceEner ES 57.19
Exelixis
EXEL 24.87
Exelon
EXC 37.83
Expedia
EXPE113.28
ExpeditorsIntl EXPD 63.90
ExpressScripts ESRX 76.70
ExtraSpaceSt EXR 86.16
t ExxonMobil XOM 73.60
F5Networks FFIV 147.92
FMC
FMC 82.69
Facebook
FB 184.19
FactSet
FDS 211.31
Fastenal
FAST 57.37
FederalRealty FRT 117.94
FedEx
FDX 246.91
Ferrari
RACE 122.25
FiatChrysler FCAU 20.98
s FibriaCelulose FBR 21.95
FidNatlFin FNF 38.56
FidNatlInfo FIS 100.32
FifthThirdBncp FITB 33.62
58.com
WUBA 80.46
FirstAmerFin FAF 59.15
FirstData
FDC 15.99
FirstHorizonNatl FHN 19.79
FirstRepBank FRC 95.81
FirstSolar FSLR 69.52
FirstEnergy FE 33.42
Fiserv
FISV 147.59
FleetCorTech FLT 207.90
Flex
FLEX 18.39
FlirSystems FLIR 50.65
Fluor
FLR 57.50
FomentoEconMex FMX 93.26
FordMotor F
11.02
Fortinet
FTNT 54.54
Fortis
FTS 33.22
Fortive
FTV 77.61
FortBrandsHome FBHS 61.70
Franco-Nevada FNV 68.66
FranklinRscs BEN 38.86
FreeportMcM FCX 18.66
FreseniusMed FMS 51.06
Autohome ATHM 87.05 1.29 CapitalOne COF 97.20 -1.62
Autoliv
ALV 150.40 0.12 CardinalHealth CAH 72.04 -0.23
ADP
ADP 116.10 -1.29 Carlisle
CSL 107.14 -1.12
AutoZone AZO 649.30 -0.79 Carlyle
CG 22.75 -0.25
Avalonbay AVB 163.47 1.95 CarMax
KMX 62.80 0.18
Avangrid
AGR 49.57 0.49 Carnival
CCL 66.96 -0.61
AveryDennison AVY 114.83 -1.08 Carnival
CUK 66.56 -0.55
AxaltaCoating AXTA 31.16 -0.35 Caterpillar CAT 152.54 -1.15
BB&T
BBT 54.62 -0.76 Cavium
CAVM 87.19 0.24
BCE
BCE 43.47 -0.17 CboeGlobalMkts CBOE 119.29 -0.63
BHPBilliton BHP 45.16 0.36 Celanese A CE 106.07 -1.76
BHPBilliton BBL 40.31 0.44 Celgene
CELG 91.61 0.05
BOK Fin
BOKF 99.86 -0.63 Cemex
CX
7.21 -0.12
BP
BP 38.87 -0.68 CenovusEnergy CVE 8.06 0.02
BRF
BRFS 8.09 -0.13 Centene
CNC 103.56 1.89
BT Group BT 16.02 -0.14 CenterPointEner CNP 27.05 -0.26
BWX Tech BWXT 63.79 -0.56 CentraisElBras EBR 6.98 -0.47
Baidu
BIDU 259.35 1.00 CenturyLink CTL 17.33 -0.37
BakerHughes BHGE 30.60 0.25 Cerner
CERN 62.04 -1.01
Ball
BLL 40.94 -0.68 CharterComms CHTR 340.96 -9.05
BancoBilbaoViz BBVA 8.12 -0.08 CheckPoint CHKP 104.95 -0.30
BancodeChile BCH 102.17 -0.76 Chemours CC 49.68 -0.30
BancoMacro BMA 109.46 -0.51 CheniereEnergy LNG 53.66 -0.24
BcoSantChile BSAC 33.19 0.13 CheniereEnerPtrs CQP 29.85 -0.47
BcoSantMex BSMX 7.14 -0.08 CheniereEnHldgs CQH 28.45 -0.41
BancoSantander SAN 6.62 -0.11 Chevron
CVX 115.13 -1.33
BanColombia CIB 42.95 -0.01 ChinaEastrnAir CEA 40.89 -0.37
BankofAmerica BAC 32.14 -0.22 ChinaLifeIns LFC 14.70 -0.02
BankofMontreal BMO 75.96 0.35 ChinaLodging HTHT 132.12-15.23
BankNY Mellon BK 54.87 -1.09 ChinaMobile CHL 45.79 0.30
BkNovaScotia BNS 63.24 0.57 ChinaPetrol SNP 82.23 1.55
BankofOzarks OZRK 51.35 -1.32 ChinaSoAirlines ZNH 64.69 -0.95
Barclays
BCS 11.65 -0.11 ChinaTelecom CHA 42.85 -0.02
BarrickGold ABX 12.32 0.14 ChinaUnicom CHU 12.20 0.07
BaxterIntl BAX 67.28 -0.81 Chipotle
CMG 319.66 -7.14
BectonDicknsn BDX 223.52 -0.33 Chubb
CB 140.76 -1.18
BeiGene
BGNE 153.80 -1.68 ChunghwaTel CHT 37.06 0.13
Berkley
WRB 71.33 -0.75 Church&Dwight CHD 49.84 -0.90
BerkHathwy A BRK.A 310655-3383.60 Cigna
CI 166.88 2.49
BerkHathwy B BRK.B 206.99 -2.14 CimarexEnergy XEC 93.54 0.98
BerryGlobal BERY 55.86 -0.43 CincinnatiFin CINF 74.05 -1.03
BestBuy
BBY 69.90 -1.62 Cintas
CTAS 173.61 -2.52
Bio-RadLab A BIO 269.40 -1.54 CiscoSystems CSCO 45.28 0.12
Biogen
BIIB 285.72 2.48 Citigroup
C
73.47 -1.44
BioMarinPharm BMRN 85.95 -0.21 CitizensFin CFG 45.13 -0.60
BlackKnight BKI 48.95 -0.05 CitrixSystems CTXS 95.26 -0.34
BlackBerry BB 12.80 0.19 Clorox
CLX 128.57 -2.62
BlackRock BLK 558.96 -5.10 Coca-Cola KO 43.78 -0.40
Blackstone BX 33.98 -0.28 Coca-Cola Euro CCE 41.21 -0.84
BlueBuffaloPet BUFF 39.86
... Coca-Cola Femsa KOF 69.37 1.51
bluebirdbio BLUE 220.20 -3.15 Cognex
CGNX 54.82 -0.11
Boeing
BA 330.26 -8.41 CognizantTech CTSH 83.63 -0.16
BookingHldgs BKNG 2188.90 18.90 ColgatePalm CL 69.99 -0.88
BorgWarner BWA 50.59 -0.24 Comcast A CMCSA 36.02 -0.41
BostonProps BXP 125.59 0.33 Comerica
CMA 97.72 -1.38
BostonSci BSX 28.01 -0.42 CommerceBcshrs CBSH 60.59 -0.52
Braskem
BAK 28.98 -0.32 CommScope COMM 40.70 -0.26
BrighthouseFin BHF 52.68 -0.78 SABESP
SBS 11.67
...
Bristol-Myers BMY 66.63 -0.05 ConagraBrands CAG 37.46 -0.57
BritishAmTob BTI 58.76 0.52 ConchoRscs CXO 150.21 -0.29
Broadcom AVGO 260.59 -0.63 ConocoPhillips COP 53.96
...
BroadridgeFinl BR 107.81 -0.19 ConEd
ED 75.97 0.48
BrookfieldMgt BAM 39.82 0.34 ConstBrands B STZ.B 227.65 -2.36
BrookfieldInfr BIP 40.87 0.08 ConstBrands A STZ 227.39 -0.55
Brown&Brown BRO 52.54 -0.26 ContinentalRscs CLR 52.72 0.92
Brown-Forman B BF.B 54.37 -0.18 Cooper
COO 233.89 -2.97
Brown-Forman A BF.A 53.30 -0.35 Copart
CPRT 50.71 -0.07
BuckeyePtrs BPL 44.76 -0.81 Corning
GLW 29.54 -0.30
Bunge
BG 74.24 -1.63 s CoStar
CSGP 364.42 1.32
BurlingtonStrs BURL 127.16 0.07 Costco
COST 184.63 -2.83
CA
CA 35.84 -0.43 Coty
COTY 18.97 -0.23
CBD Pao
CBD 20.51 -0.15 Credicorp
BAP 215.89 -4.68
CBRE Group CBG 47.25 -0.37 CreditAcceptance CACC 332.84 -2.14
CBS A
CBS.A 51.29 -0.39 CreditSuisse CS 18.03 -0.04
CBS B
CBS 51.27 -0.63 CrownCastle CCI 112.08 0.42
CDK Global CDK 69.56 -0.67 CrownHoldings CCK 51.02 -0.32
GGP 21.69
CDW
CDW 75.43 -0.22 Ctrip.com CTRP 48.73 -0.05 GGP
CF Industries CF 40.31 -0.07 Cullen/Frost CFR 108.99 -0.84 Gallagher AJG 70.74
Gaming&Leisure GLPI 33.85
CGI Group GIB 58.74 0.07 Cummins
CMI 159.61 -0.74
GPS 32.42
CH Robinson CHRW 89.74 -1.97 CurtissWright CW 135.59 -1.05 Gap
CIT Group CIT 54.04 -0.56 CypressSemi CY 18.46 0.13 GardnerDenver GDI 32.96
Garmin
GRMN 60.26
CME Group CME 162.95 -1.86
Gartner
IT 123.21
CMS Energy CMS 43.32 0.36
Gazit-Globe GZT 9.40
CNA Fin
CNA 52.32 -0.40
CNOOC
CEO 143.52 0.71 DISH Network DISH 40.50 -0.49 GeneralDynamics GD 221.69
CPFLEnergia CPL 14.85 -0.10 DTE Energy DTE 101.77 0.84 GeneralElec GE 14.27
CRH
CRH 34.53 0.40 DXC Tech DXC 104.34 -1.70 GeneralMills GIS 51.81
DHR 102.18 -0.62 GeneralMotors GM 37.69
CSRA
CSRA 40.67 0.09 Danaher
DRI 94.21 -0.27 Genpact
G
31.88
CSX
CSX 56.83 -0.65 Darden
DVA 70.03 -0.16 Gentex
GNTX 23.31
CVS Health CVS 67.05 -1.20 DaVita
DE 160.21 -1.11 GenuineParts GPC 90.38
CabotOil
COG 25.57 -0.07 Deere
GGB 4.85
CadenceDesign CDNS 38.83 -0.34 DellTechs DVMT 77.82 0.48 Gerdau
DAL 56.15 -0.44 Gildan
GIL 28.89
CaesarsEnt CZR 12.65 0.20 DeltaAir
CamdenProperty CPT 83.93 0.81 DentsplySirona XRAY 57.30 -0.50 GileadSciences GILD 81.10
GSK 37.11
CampbellSoup CPB 44.20 0.26 DeutscheBank DB 15.70 -0.09 GSK
CIBC
CM 91.20 0.25 DevonEnergy DVN 32.62 -0.11 s GlobalPayments GPN 117.88
DEO 135.72 0.51 GoDaddy
GDDY 63.34
CanNtlRlwy CNI 74.63 0.31 Diageo
GG 13.44
CanNaturalRes CNQ 29.92 -0.04 DiamondbkEner FANG 125.81 -1.34 Goldcorp
CanPacRlwy CP 177.04 -1.12 DigitalRealty DLR 105.47 0.82 GoldmanSachs GS 264.43
Canon
CAJ 37.21 0.07 DiscoverFinSvcs DFS 76.46 -0.87 Goodyear GT 28.04
ABB
ABB 24.22 -0.01
t ADT
ADT 10.21 -0.33
AES
AES 10.70 0.03
Aflac
AFL 90.21 -0.54
AGNC Invt AGNC 18.80 0.01
ANGI Homesvcs ANGI 14.95 -0.22
Ansys
ANSS 166.95 -0.80
ASML
ASML 211.53 3.51
AT&T
T
37.03 -0.36
AbbottLabs ABT 62.86 -0.34
AbbVie
ABBV 118.94 -0.81
Abiomed
ABMD 295.85 2.68
Accenture ACN 161.00 -1.49
ActivisionBliz ATVI 74.22 -1.71
AcuityBrands AYI 148.87 -2.22
AdobeSystems ADBE 218.44 -1.32
AdvanceAuto AAP 117.06 -1.94
AdvMicroDevices AMD 11.36 -0.28
AdvSemiEngg ASX 7.35 0.04
Aegon
AEG 6.81 0.01
AerCap
AER 50.76 1.13
Aetna
AET 176.62 -0.82
AffiliatedMgrs AMG 193.46 -1.49
AgilentTechs A
69.92 -0.76
AgnicoEagle AEM 39.80 0.29
AirProducts APD 168.98 -1.95
AkamaiTech AKAM 73.25 -0.05
AlaskaAir ALK 65.67 -3.12
Albemarle ALB 100.33 -2.46
Alcoa
AA 46.57 -2.02
AlexandriaRlEst ARE 126.40 -0.16
AlexionPharm ALXN 122.68 1.60
Alibaba
BABA 192.56 4.15
AlignTech ALGN 272.48 2.77
Alkermes ALKS 61.50 1.15
Alleghany Y
627.31 -1.46
Allegion
ALLE 85.36 -0.52
Allergan
AGN 167.06 3.87
AllianceData ADS 230.33 -2.30
AlliantEnergy LNT 39.54 0.24
Allstate
ALL 96.41
...
AllyFinancial ALLY 27.85 -0.72
AlnylamPharm ALNY 141.83 -2.33
Alphabet A GOOGL 1148.89 8.98
Alphabet C GOOG 1149.49 11.32
Altaba
AABA 77.20 1.23
AlticeUSA ATUS 19.86 -0.39
Altria
MO 63.82 -1.61
AlumofChina ACH 14.46 -0.05
Amazon.com AMZN 1591.00 2.82
s Ambev
ABEV 7.39 0.11
Amdocs
DOX 67.87 -0.72
Amerco
UHAL 340.39 -0.32
Ameren
AEE 54.63 0.54
AmericaMovil AMX 19.33 -0.02
AmericaMovil A AMOV 19.14 -0.32
AmerAirlines AAL 55.28 -0.95
AEP
AEP 66.59 0.55
AmerExpress AXP 94.53 -0.84
AmericanFin AFG 112.99 -1.43
t AIG
AIG 54.93 -0.69
AmerTowerREIT AMT 146.46 0.21
AmerWaterWorks AWK 81.20 0.45
Ameriprise AMP 157.01 -1.90
AmerisourceBrgn ABC 98.58 -2.02
Ametek
AME 78.20 -0.18
Amgen
AMGN 190.57 0.82
Amphenol APH 91.37 -1.14
AnadarkoPetrol APC 58.92 0.37
AnalogDevices ADI 94.09 -0.57
Andeavor ANDV 99.43 0.86
AndeavorLog ANDX 46.43 -1.10
AB InBev BUD 113.50 -1.20
AnnalyCap NLY 10.53 -0.04
AnteroResources AR 20.85 0.03
Anthem
ANTM 229.03 -1.19
Aon
AON 144.22 -1.74
Apache
APA 35.65 0.19
ApartmtInv AIV 40.30 0.25
ApolloGlbMgmt APO 32.83 -0.18
Apple
AAPL 178.44 -1.53
ApplMaterials AMAT 60.23 0.54
Aptiv
APTV 89.30 -1.60
AquaAmerica WTR 33.71 0.10
Aramark
ARMK 41.01 -0.31
ArcelorMittal MT 32.53 0.03
t ArchCapital ACGL 84.41 -1.02
ArcherDaniels ADM 43.77 -0.47
Arconic
ARNC 24.06 -0.89
AristaNetworks ANET 298.50 8.82
ArrowElec ARW 80.66 -0.70
AspenTech AZPN 81.21 -0.60
AstraZeneca AZN 33.84 0.02
Athene
ATH 50.10 -1.39
Atlassian
TEAM 59.98 0.15
AtmosEnergy ATO 81.34 0.32
Autodesk ADSK 136.19 0.19
Stock
Net
Sym Close Chg
Stock
ExtMktIdxPrem r
IntlIdxPrem r
SAIUSLgCpIndxFd
TMktIdxF r
TMktIdxPrem
USBdIdxInstPrem
10.21 -3.1
1.82 -7.7
0.40 -2.4
2.32 -2.9
1.80 -3.0
54.61 -1.2
84.23 -1.2
3.44 -5.1
6.90 ...
24.55 ...
7.20 -2.3
2.00 -5.1
3.79 -1.3
7.33 -2.7
1.60 -2.9
0.95 -1.0
48.15 0.5
30.18 -1.8
30.31 -0.3
8.20 -2.5
1.05 -7.0
26.04 0.3
0.18 -66.4
15.00 -1.2
25.95 -0.4
73.53 -1.2
Net YTD
NAV Chg %Ret Fund
64.22 -0.27
43.32 +0.02
14.75 -0.08
78.90 -0.42
78.89 -0.42
11.31 +0.02
Fidelity Advisor I
NwInsghtI 33.56 -0.07
Fidelity Freedom
16.79 -0.01
FF2020
14.63 -0.01
FF2025
FF2030
18.43 -0.02
Freedom2020 K 16.77 -0.01
Freedom2025 K 14.60 -0.02
Freedom2030 K 18.41 -0.02
Freedom2035 K 15.61 -0.03
Freedom2040 K 10.97 -0.02
Fidelity Invest
Balanc
24.36 -0.06
95.53 -0.02
BluCh
131.56 -0.21
Contra
131.50 -0.21
ContraK
CpInc r
10.30 -0.01
40.25 +0.02
DivIntl
199.66 +0.46
GroCo
GrowCoK 199.66 +0.46
7.74 +0.01
InvGB
10.99 +0.01
InvGrBd
55.11 -0.22
LowP r
MagIn
110.32 -0.33
121.14 -0.15
OTC
24.00 -0.05
Puritn
SrsEmrgMkt 22.64 -0.02
SrsGroCoRetail 18.65 +0.05
SrsIntlGrw 16.59 +0.03
3.5
0.3
3.3
3.3
3.3
-1.9
7.0
1.3
1.6
2.0
1.3
1.5
2.1
2.6
2.6
2.7
8.9
9.1
9.1
0.7
0.6
11.8
11.8
-1.8
-1.8
1.1
5.5
10.3
2.5
5.7
12.1
2.7
SrsIntlVal
TotalBond
Net
Sym Close Chg
Stock
Net
Sym Close Chg
Stock
Net
Sym Close Chg
Stock
Net
Sym Close Chg
Stock
LKQ 39.03 -0.39 MorganStanley MS 56.99 -1.04 PolarisIndustries PII 118.87 -1.87 SoCopper SCCO 54.70 0.49 UnionPacific UNP 134.83 -2.00
0.07 LKQ
LLL 203.87 -2.65 Mosaic
MOS 27.10 -0.51 Praxair
3.56 L3 Tech
PX 157.54 -2.83 SouthwestAir LUV 59.62 -0.71 UnitedContinental UAL 70.74 -1.86
0.22 LabCpAm LH 174.35 -0.30 MotorolaSol MSI 108.95 0.25 PrincipalFin PFG 62.05 -0.63 SpectraEnerPtrs SEP 39.80 -0.85 UnitedMicro UMC 2.60 -0.01
Mylan
MYL
LamResearch
LRCX
UPS 108.76 -0.57
42.02
-0.33
222.64
-1.33
-0.07
Procter&Gamble PG 79.00 -0.72 SpiritAeroSys SPR 86.28 -4.74 UPS B
1.53 LamarAdv LAMR 66.50 -0.37 s NRG Energy NRG 30.20 0.20 s Progressive PGR 61.40 1.39 s Splunk
SPLK 108.67 2.24 UnitedRentals URI 184.82 -1.83
0.21 LambWeston LW 56.08 -0.39 NTTDoCoMo DCM 25.85 0.14 Prologis
PLD 63.22 0.33 Sprint
S
5.27 -0.02 US Bancorp USB 53.27 -0.88
NVR 3054.74-76.46 Proofpoint PFPT 120.51 1.93 s Square
X
38.38 -1.86
0.18 LasVegasSands LVS 73.90 0.04 NVR
SQ 54.61 2.78 US Steel
LAZ 55.94 0.26 NXP Semi NXPI 122.30 -0.33 PrudentialFin PRU 108.05 -1.55 StanleyBlackDck SWK 156.81 0.18 UnitedTech UTX 129.58 -0.57
-0.21 Lazard
NDAQ 84.37 -0.88 Prudential PUK 53.99 2.88 Starbucks SBUX 58.83 -0.22 UnitedHealth UNH 225.38 -1.56
LEA 188.50 -2.78 Nasdaq
-0.26 Lear
-0.65 Leggett&Platt LEG 47.41 0.75 NationalGrid NGG 54.87 0.14 PublicServiceEnt PEG 48.45 1.06 StateStreet STT 105.78 -1.55 UnivDisplay OLED 125.80 -0.39
LDOS 68.53 -0.45 NatlInstruments NATI 51.95 -0.43 PublicStorage PSA 194.61 -2.79 Statoil
-0.05 Leidos
STO 23.06 0.03 UniversalHealthB UHS 123.26 -0.63
LEN 59.90 -0.66 NatlOilwell NOV 37.39 0.08 PulteGroup PHM 29.55 -0.89 SteelDynamics STLD 47.07 -0.17 UnumGroup UNM 49.51 -0.81
0.74 Lennar A
VER 7.03 -0.02
LEN.B 47.84 -0.63 NatlRetailProp NNN 38.52 -0.22 Qiagen
-0.08 Lennar B
QGEN 33.65 -0.35 STMicroelec STM 24.07 0.15 VEREIT
VFC 74.75 1.28
-0.14 LennoxIntl LII 212.20 -0.04 NektarTherap NKTR 104.51 1.35 Qorvo
QRVO 82.22 -1.20 Stryker
SYK 166.38 -0.73 VF
NTAP 64.55 -0.28 Qualcomm QCOM 60.12 0.42 SumitomoMits SMFG 8.65 0.03 VICI Prop VICI 19.63 0.03
... s NetApp
-0.31 LeucadiaNatl LUK 24.30
NTES 314.17 2.55 QuestDiag DGX 104.96 -0.03 SunComms SUI 89.41 0.84 Visa
V
122.58 -0.62
0.14 LibertyBroadbandC LBRDK 88.68 -1.52 Netease
NFLX 321.55 5.67
-0.39 LibertyBroadbandA LBRDA 87.86 -1.49 Netflix
SunLifeFinancial SLF 42.21 0.18 VailResorts MTN 223.06 1.69
Neurocrine
NBIX
92.30
1.94
Vale
VALE
13.04 0.14
LibertyGlobal
B
LBTYB
32.80
-0.10
-1.39
SuncorEnergy SU 32.54 -0.03
-0.52 LibertyGlobal C LBTYK 31.71 -0.02 NewOrientalEduc EDU 91.81 0.46
SunTrustBanks STI 71.06 -1.21 ValeroEnergy VLO 92.66 -0.83
RELX
RENX
20.81
0.04
-0.44 LibertyGlobal A LBTYA 32.96 0.03 NY CmntyBcp NYCB 14.16 -0.22
Symantec SYMC 27.37 0.03 VarianMed VAR 125.74 0.25
RELX
RELX 21.01 -0.03
VEDL 19.62 -0.04
-0.82 LibertyQVC A QRTEA 27.50 -0.15 NewellBrands NWL 28.43 -0.17
SynchronyFin SYF 36.10 -0.58 Vedanta
RPM
RPM 50.72 -0.75
0.45 LibertyFormOne C FWONK 31.53 -0.94 NewmontMin NEM 38.19 -0.03
Synopsys SNPS 87.82 -0.66 VeevaSystems VEEV 77.45 1.00
RSP
Permian
RSPP
40.26 -0.96
NewsCorp
B
NWS
16.65
...
Ventas
VTR
49.68 -0.67
LibertyFormOne
A
FWONA
30.16
-0.73
1.98
SynovusFin SNV 51.70 -0.66
RalphLauren RL 107.78 0.46
VRSN123.01 2.50
-0.02 LibertyBraves A BATRA 23.25 -0.23 NewsCorp A NWSA 16.33 -0.04
Sysco
SYY 59.88 -0.82 s VeriSign
RandgoldRscs
GOLD
84.70 0.33
NextEraEnergy
NEE
158.01
3.34
LibertyBraves
C
BATRK
23.36
-0.18
VeriskAnalytics
VRSK
104.09
-0.39
0.26
NKE 66.20 0.03 RaymondJames RJF 95.82 -1.43
Verizon
VZ 48.45 -0.20
-0.85 LibertySirius C LSXMK 42.51 -0.19 Nike
Raytheon
RTN
208.31
-2.31
NI
23.31 0.17
VertxPharm VRTX 174.38 -0.58
-0.12 LibertySirius A LSXMA 42.71 -0.27 NiSource
RealtyIncome O
51.39 -0.06 TAL Education TAL 38.71 0.71 Viacom A VIA 38.90 0.80
0.17 LibertyProperty LPT 40.06 -0.15 NobleEnergy NBL 29.70 -0.48
RHT 155.04 1.09 TD Ameritrade AMTD 61.02 -0.71 Viacom B VIAB 32.64 0.04
NOK 5.82 -0.04 RedHat
LLY 78.49 -0.66 Nokia
-0.03 EliLilly
RegencyCtrs REG 58.82 -0.38 TE Connectivity TEL 103.93 -0.69 Vipshop
VIPS 18.11 0.46
-1.08 LincolnElectric LECO 92.39 -1.39 NomuraHoldings NMR 6.02 0.01
TU 35.92 0.02 VirtuFinancial VIRT 33.45 0.50
NDSN 139.22 -0.88 RegenPharm REGN 341.42 3.67 Telus
-0.01 LincolnNational LNC 76.27 -1.57 Nordson
RegionsFin
RF
19.40
-0.31
Ternium
TX
33.30
-0.28
Nordstrom
JWN
49.48
-0.85
LionsGate
B
LGF.B
27.19
-0.43
VistraEnergy
VST 20.29 -0.17
0.13
ReinsGrp
RGA 158.24 -0.90 TIM Part
TSU 22.49 0.05 VMware
VMW 124.75 0.72
-0.34 LionsGate A LGF.A 29.07 -0.40 NorfolkSouthern NSC 136.64 -5.74
RelianceSteel
RS
91.16
-2.13
TJX
TJX
81.88
-0.42
Vodafone VOD 28.74 0.10
-0.94 LiveNationEnt LYV 44.81 -0.34 NorthernTrust NTRS 106.49 -2.06
RepublicSvcs
RSG
68.45
-0.55
T-MobileUS
TMUS
64.78
-0.20
NorthropGrum
NOC
340.10
-4.23
LloydsBanking
LYG
3.80
...
VornadoRealty
VNO 68.22
...
-0.01
RMD 98.59 -0.30 TRowePrice TROW 115.50 -0.77 VoyaFinancial VOYA 54.00 -0.15
-1.08 LockheedMartin LMT 331.68 -1.78 NorwegCruise NCLH 55.95 -0.70 ResMed
RestaurantBrands
QSR
58.10
1.13
TableauSftwr
DATA
84.67
0.45
Novartis
NVS
82.24
-0.02
Loews
L
50.96
-0.28
VulcanMatls
VMC
120.43
-1.24
-0.31
RIO 52.20 0.16 TaiwanSemi TSM 45.15 0.16
-0.37 LogitechIntl LOGI 39.23 0.28 NovoNordisk NVO 50.29 -0.04 RioTinto
NUE 66.00 -1.53 RobertHalf RHI 58.45 -0.68 TakeTwoSoftware TTWO109.23 -4.26
LOGM 127.15 -0.35 Nucor
0.22 LogMeIn
ROK 183.41 -2.01 Tapestry
TPR 52.48 -0.50
NTNX 54.66 1.62 Rockwell
LOW 86.38 0.24 s Nutanix
-1.38 Lowe's
WABCO
WBC 139.17 -1.26
NTR 50.45 -0.10 RockwellCollins COL 135.74 -0.30 TargaResources TRGP 46.74 -0.40
LULU 80.75 0.95 Nutrien
0.53 lululemon
WEC Energy WEC 61.30 0.50
RogersComm
B
RCI
45.21
0.14
NVIDIA
NVDA
248.74
1.03
Target
TGT 70.65 -0.52
LyondellBasell
LYB
108.75
-1.59
0.79
WEX
WEX 158.66 0.88
Rollins
ROL 51.71 -0.52 TataMotors TTM 27.24 -0.11
0.52
...
RoperTech ROP 279.85 -1.81 TechnipFMC FTI 30.13 -0.21 W.P.Carey WPC 61.90
-2.18
t WPP
WPP 80.75 -0.28
-0.24 M&T Bank MTB 190.31 -2.74 OGE Energy OGE 31.79 0.27 RossStores ROST 77.18 0.18 TeckRscsB TECK 27.41 0.45 Wabtec
WAB 82.86 0.28
RoyalBkCanada
RY
78.41
-0.05
TelecomArgentina
TEO
33.66
0.07
-3.16 MGM Resorts MGM 35.69 -0.10 ONEOK
OKE 57.16 -0.60
WalgreensBoots WBA 68.55 -1.31
9.73 -0.14
-1.08 MKS Instrum MKSI 123.25 -0.05 OReillyAuto ORLY 249.14 -1.68 RoyalBkScotland RBS 7.39 0.06 TelecomItalia TI
Walmart
WMT 87.67 -0.63
RoyalCaribbean RCL 125.63 -0.32 TelecomItalia A TI.A 8.33 -0.21
0.50 MPLX
MPLX 34.71 -0.65 OccidentalPetrol OXY 64.04 -0.16
WasteConnections WCN 73.40 -0.15
RoyalDutchA RDS.A 62.20 -0.45 TeledyneTech TDY 189.58 -2.64
2.79 MSCI
MSCI 154.43 2.79 OldDomFreight ODFL 145.95 -2.50
WasteMgt WM 86.41 -0.25
RoyalDutchB RDS.B 63.07 -0.52 Teleflex
TFX 265.69 -1.66
0.02 Macerich
MAC 59.60 0.71 Omnicom OMC 73.96 0.24
Waters
WAT 211.22 -0.91
Ryanair
RYAAY 123.81 0.24 TelefonicaBras VIV 15.53 -0.01 s
-0.95 Macy's
ON 25.74 -0.28
M
29.23 -0.21 ON Semi
Watsco
WSO 182.14 0.87
SAP
SAP
108.08 0.46 Telefonica TEF 9.93 0.05
-0.13 MagellanMid MMP 63.71 -0.63 OpenText
OTEX 36.46 0.22
Wayfair
W 84.86 0.50
-0.10 MagnaIntl MGA 53.28 0.13 Oracle
ORCL 52.32 -0.26 S&P Global SPGI 192.38 -3.51 TelekmIndonesia TLK 29.35 -0.20 Weibo
WB 131.49 0.36
TS 35.51 -0.26 WellCareHealth WCG 194.27 -0.04
-0.84 Manpower MAN 120.61 -0.63 Orange
ORAN 17.39 0.06 SBA Comm SBAC 170.23 -0.11 Tenaris
TER 49.35 0.35 WellsFargo WFC 56.63 -0.93
-2.27 ManulifeFin MFC 18.66 0.05 OrbitalATK OA 132.01 -0.11 SEI Investments SEIC 75.92 -0.67 Teradyne
Sina
SINA
118.46
0.75
Tesla
TSLA 326.63-15.21 Welltower WELL 53.53 -0.23
-0.84 MarathonOil MRO 14.87 0.05 Orix
IX
88.76 0.45
SHI 60.13 0.75 TevaPharm TEVA 18.57 -0.75 WestPharmSvcs WST 92.17 0.10
-0.16 MarathonPetrol MPC 69.36 0.12 Oshkosh
OSK 78.58 -0.79 SINOPEC
SK
Telecom
SKM
24.17
-0.13
TexasInstruments
TXN 109.97 -0.62 WestarEnergy WR 50.34 0.43
-0.24 Markel
MKL 1142.27 -4.91 OwensCorning OC 81.94 -1.45
TXT 59.09 0.19 s WestAllianceBcp WAL 60.06 -1.99
0.31 MarketAxess MKTX 223.57 -0.40 PG&E
PCG 44.17 -0.93 SLGreenRealty SLG 98.71 0.22 Textron
0.59 Marriott
PHI 29.15 -0.43 SS&C Tech SSNC 52.11 -0.12 ThermoFisherSci TMO 213.46 -1.49 WesternDigital WDC 103.20 0.29
MAR 141.43 -0.32 PLDT
SIVB 259.53 -2.66 ThomsonReuters TRI 39.69 -0.18 WesternGasEquity WGP 35.53 -0.71
PNC 158.09 -2.40 SVB Fin
-0.59 Marsh&McLen MMC 83.77 -0.85 PNC Fin
SABR 22.05 -0.18 ThorIndustries THO 122.85 -1.05 WesternGasPtrs WES 46.37 -0.79
PKX 79.74 -1.75 Sabre
-1.75 MartinMarietta MLM 206.73 -3.59 POSCO
SageTherap
SAGE 173.84 -0.07 3M
MMM 234.29 -3.28 WesternUnion WU 20.31 -0.06
PPG 115.04 -1.03
-0.19 MarvellTech MRVL 23.40 0.46 PPG Ind
TIF 101.02 -0.27 WestlakeChem WLK 116.35 -1.79
PPL 27.93 0.17 s Salesforce.com CRM 127.99 1.26 Tiffany
-2.37 Masco
MAS 41.57 -0.72 PPL
SNY 40.45 0.05 TimeWarner TWX 96.40 0.24 WestpacBanking WBK 23.47 0.01
PTC 79.69 0.21 Sanofi
-0.01 Mastercard MA 180.12 -0.89 PTC
TOL 44.38 -0.73 WestRock WRK 66.20 -0.81
PVH 143.67 0.33 SantanderCons SC 16.96 -0.16 Toll Bros
0.08 s MatchGroup MTCH 46.79 1.36 PVH
SSL 34.22 -0.46 Torchmark TMK 85.24 -1.14 Weyerhaeuser WY 35.24 -0.31
PCAR 66.35 -1.03 Sasol
-0.96 MaximIntProducts MXIM 62.01 -0.18 Paccar
Schlumberger
SLB
Toro
TTC 62.62 -0.58 WheatonPrecMet WPM 19.90 0.02
66.43
-0.71
0.08 McCormickVtg MKC.V 110.46 -2.46 PackagingCpAm PKG 118.52 -1.08
SCHW 55.94 -0.74 TorontoDomBk TD 58.50 0.17 Whirlpool WHR 160.12 -2.60
-0.62 McCormick MKC 110.56 -0.18 PacWestBancorp PACW 52.16 -0.75 SchwabC
Total
TOT 58.21 0.55 Williams
Seagate
STX
59.93
0.25
WMB 28.14 0.12
-0.51 McDonalds MCD 158.24 0.02 PagSeguroDig PAGS 35.48 -0.46
SEE 44.21 -0.53 TotalSystem TSS 89.86 0.35 WilliamsPartners WPZ 36.87 -0.20
-0.33 McKesson MCK 155.44 -2.25 PaloAltoNtwks PANW 188.45 0.21 SealedAir
... WillisTowers WLTW 161.53 -0.86
... SeattleGenetics SGEN 58.59 -0.73 ToyotaMotor TM 130.00
-1.20 Medtronic MDT 82.30 -1.17 ParkHotels PK 27.04
... TractorSupply TSCO 62.62 -0.31 Wipro
WIT 5.63 -0.15
-2.00 MelcoResorts MLCO 27.44 -0.34 ParkerHannifin PH 179.46 -2.40 SemicondctrMfg SMI 6.95
0.82 MercadoLibre MELI 404.97 -1.44 ParsleyEnergy PE 26.84 0.02 SempraEnergy SRE 112.86 2.16 TransCanada TRP 44.10 -0.11 WooriBank WF 44.11 -0.59
TransDigm TDG 295.12 5.61 Workday
SensataTech
ST
53.00
-0.62
PAYX 65.89 -0.83
MRK 54.80 -0.09 Paychex
WDAY 138.79 1.45
-0.25 Merck
MET 46.91 -0.19 s PaycomSoftware PAYC 111.25 1.73 ServiceCorp SCI 38.81 0.01 TransUnion TRU 58.35 0.04 s Worldpay WP 84.41 -0.62
... MetLife
TRV 139.52 -1.17 Wyndham WYN 116.08 -1.66
PYPL 83.31 3.11 ServiceMaster SERV 50.64 -0.23 Travelers
-0.39 MettlerToledo MTD 606.13 -5.87 PayPal
TRMB 38.61 -0.31 WynnResorts WYNN 185.22 -0.19
PSO 10.61 0.05 s ServiceNow NOW 175.34 1.38 Trimble
0.55 MichaelKors KORS 61.10 -1.18 Pearson
-0.05 MicroFocus MFGP 27.59 0.04 PembinaPipeline PBA 31.67 -0.17 t ShawComm B SJR 18.80 -0.17 TurkcellIletism TKC 9.80 0.22 XPO Logistics XPO 104.21 1.25
TurquoiseHill
TRQ 3.26
... XcelEnergy XEL 43.54 0.41
SherwinWilliams
SHW
409.02
-4.75
PNR 70.64 0.67
-1.48 MicrochipTech MCHP 97.25 -0.78 Pentair
XRX 30.75 -0.59
0.35 MicronTech MU 59.78 0.35 People'sUtdFin PBCT 19.82 -0.23 ShinhanFin SHG 42.20 0.35 21stCenturyFoxA FOXA 37.69 0.28 Xerox
21stCenturyFoxB
FOX
37.23
0.38
Shire
SHPG
132.56
1.34
PEP 112.61 -0.99
Xilinx
XLNX 76.01 -0.13
0.01 Microsemi MSCC 66.24 -0.21 PepsiCo
s
Shopify
SHOP
146.25
0.93
Twitter
TWTR
36.60
2.49
PerkinElmer
PKI
77.09
-0.99
Microsoft
MSFT
93.85
-0.56
Xylem
XYL 77.11 -0.87
-0.25
PRGO 85.78 -0.73 SignatureBank SBNY 152.49 -4.86 TylerTech TYL 209.25 -0.23 YPF
MidAmApt MAA 90.38 0.91 Perrigo
YPF 21.61 -0.43
Middleby
MIDD 131.03 -2.10 PetroChina PTR 68.42 0.37 SimonProperty SPG 158.49 1.02 TysonFoods TSN 75.38 -0.24 YY
YY 115.88 -2.30
SIRI 6.48 -0.05 UBS Group UBS 18.20 -0.03 Yandex
MitsubishiUFJ MTU 6.83 -0.03 PetroleoBrasil PBR 14.48 0.04 SiriusXM
YNDX 42.99 0.70
-0.23 MizuhoFin MFG 3.70 0.01 PetroleoBrasilA PBR.A 13.71 0.12 SkechersUSA SKX 40.08 -0.85 UDR
UDR 35.54 0.13 YumBrands YUM 82.27 -0.08
-1.30 MobileTeleSys MBT 12.15 0.12 Pfizer
UGI 43.93 -0.01 YumChina YUMC 41.62 0.36
PFE 36.35 -0.40 Skyworks SWKS 111.94 -0.06 UGI
0.95 MohawkInds MHK 248.89 -1.70 PhilipMorris PM 105.61 -1.63 SmithAO
AOS 65.30 -0.58 US Foods USFD 33.57 -0.44 ZTO Express ZTO 15.23 -0.05
-0.33 MolsonCoors B TAP 81.10 0.64 Phillips66
PSX 94.21 -0.34 Smith&Nephew SNN 37.63 0.06 UltaBeauty ULTA 201.99 -6.41 ZayoGroup ZAYO 36.74 0.09
-0.12 MolsonCoors A TAP.A 82.00 0.49 PilgrimPride PPC 25.77 1.26 Smucker
SJM 130.85 -0.68 UltSoftware ULTI 247.61 -1.17 ZebraTech ZBRA 146.79 2.59
-0.29 Momo
SNAP 17.85 0.34 UltraparPart UGP 22.25 -0.03 s Zillow A
ZG 58.49 1.34
MOMO 37.27 0.45 PinnacleFoods PF 56.58 -0.55 Snap
-0.24 Mondelez MDLZ 43.88 -0.16 PinnacleWest PNW 76.78 0.36 SnapOn
SNA 152.21 0.27 UnderArmour A UAA 16.08 -0.48 s Zillow C
Z
58.64 1.40
-0.01 Monsanto MON 123.15 -0.44 PioneerNatRscs PXD 169.04 -0.52 SOQUIMICH SQM 50.66 -0.15 UnderArmour C UA 14.02 -0.56 ZimmerBiomet ZBH 116.24 -1.68
-2.03 MonsterBev MNST 58.73 0.04 PlainsAllAmPipe PAA 22.75 -0.46 Sony
SNE 50.95 0.88 Unilever
UN 53.83 -0.04 ZionsBancorp ZION 54.78 -0.97
-1.66 Moody's
SO 44.05 0.46 Unilever
UL 53.34 0.31 Zoetis
ZTS 84.35 -0.24
PAGP 22.91 -0.23 Southern
MCO 166.69 -2.39 PlainsGP
-1.18
-0.21
-0.16
0.15
-0.30
-0.04
0.05
-2.89
Amount
Payable /
Amount
-0.64
Payable /
Company
Symbol Yld % New/Old Frq
Record
-0.44 Company
Symbol Yld % New/Old Frq
Record
CWCO 2.5
Q
-0.29
Consolidated Water
.085
Apr30 /Apr02
-0.09 Increased
TNP 5.6
Q May10 /May03
Tsakos Energy Navigation
.05
-1.88
Owens Realty Mortgage ORM 4.4 .16 /.10 Q
Apr13 /Mar31 Validus Holdings
VR 2.3
Q
.38
Mar29 /Mar15
-0.09
R S
T U V
W X Y Z
O P Q
M N
Dividend Changes
Dividend announcements from March 14.
-0.08
-0.40
-1.86
0.07
0.02
-0.79
-0.57
-0.31
-0.20
-0.60
-0.10
0.02
52-Wk %
Sym Hi/Lo Chg
FAT Brands
FAT
FiveStarSrLiving FVE
GigCapital
GIG
GolarLNGPartners GMLP
GreenlightCapRe GLRE
GrupoTelevisa TV
HallmarkFin
HALL
HamiltonBeach HBB
HarleyDavidson HOG
Hasbro
HAS
HoeghLNG Ptrs HMLP
iFresh
IFMK
Inovalon
INOV
KingswayFin
KFS
KraftHeinz
KHC
LegacyAcqn
LGC
LeisureAcqn
LACQ
LifewayFoods LWAY
MS PowerPfdD MPpD
MudrickCapWt MUDSW
Neovasc
NVCN
NextDecade
NEXT
OaktreeCapital OAK
ParkerDrilling PKD
PA Reit Pfd B PEIpB
PennREITPfdC PEIpC
PetroQuestEner PQ
Pulmatrix
PULM
Qumu
QUMU
resTORbio
TORC
RibbonComms RBBN
ScorpioTankers STNG
ShawComm B SJR
SignetJewelers SIG
Silicom
SILC
SinoGlobalShip SINO
SummitMidstream SMLP
THLCreditNts21 TCRX
THLCreditNts22 TCRZ
TaubmanCtrsPfdJ TCOpJ
Teligent
TLGT
TremontMortgage TRMT
Tupperware
TUP
ValeroEnergyPtrs VLP
WPP
WPP
WestwaterRscs WWR
Net
Sym Close Chg
Stock
6.70 -3.1
1.23 -5.7
9.60 -1.7
18.03 -2.6
15.85 -1.2
16.35 -1.3
8.73 0.2
22.99 1.3
43.30 -3.1
87.58 -0.9
16.60 -3.4
6.09 -6.1
10.70 -5.9
4.30 -2.2
66.22 -1.2
9.51 -0.1
9.55 -1.0
6.50 -1.5
25.00 0.2
0.56 -1.7
0.13 -7.7
4.20 -1.6
39.80 -2.1
0.76 -2.7
21.80 -0.8
21.26 -0.5
1.03 -6.3
1.10 -14.6
1.42 -0.6
14.56 -2.4
5.07 -2.3
2.17 2.3
18.78 -0.9
38.10 -20.2
33.56 -12.0
1.04 -5.3
15.20 -1.6
25.07 0.1
25.40 0.4
24.45 0.8
2.51 2.3
12.55 -3.0
48.00 -4.2
37.40 -1.6
80.55 -0.3
0.71 0.5
Toll Brothers
1.0
TOL
.11 /.08
Q
Apr27 /Apr13
Vedanta ADR
Vina Concha y Toro ADR
Foreign
Adient
AEGON 6.2996% Fltg Perp.
1.8
4.1
ADNT
AEB
.275
.25
Q
Q
May15 /Apr18
Mar15 /Mar01
VEDL
VCO
6.6
1.1
1.30376
.11627
A
Q
Apr17 /Mar23
/Mar23
KEY: A: annual; M: monthly; Q: quarterly; r: revised; SA: semiannual;
S2:1: stock split and ratio; SO: spin-off.
Borrowing Benchmarks | WSJ.com/bonds
Money Rates
March 14, 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
Feb. index
level
Chg From (%)
Jan. '18 Feb. '17
U.S. consumer price index
0.45
0.45
248.991
255.783
All items
Core
2.2
1.8
International rates
Week
ago
Latest
Treasury bill auction
1.650 1.550 1.650 0.695
1.670 1.660 1.670 0.760
1.850 1.830 1.850 0.890
4 weeks
13 weeks
26 weeks
Secondary market
Fannie Mae
52-Week
High
Low
Prime rates
30 days
60 days
Other short-term rates
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
1.55
1.54
U.S.
1.62
0.60
—52-WEEK—
High Low
2.32113 2.24550 2.32113 1.39072
2.59013 2.51856 2.59013 1.69511
Six month
One year
Euro Libor
-0.411
-0.379
-0.329
-0.254
One month
Three month
Six month
One year
-0.407
-0.379
-0.331
-0.255
-0.388
-0.354
-0.247
-0.110
-0.420
-0.387
-0.339
-0.263
-0.371
-0.327
-0.271
-0.191
One month
Three month
Six month
One year
52-Week
high
low
Latest
-0.371
-0.327
-0.272
-0.191
Value
Traded
-0.366
-0.325
-0.241
-0.106
-0.375
-0.332
-0.279
-0.194
52-Week
High
Low
DTCC GCF Repo Index
3.25
3.25
3.25
2.50
1.548 36.550 1.836 0.582
1.568 117.700 1.852 0.615
Treasury
MBS
Open Implied
Settle Change Interest Rate
Commercial paper (AA financial)
2.05
2.04
2.09
0.89
Libor
One month
Three month
U.S. government rates
Week
ago
Call money
90 days
Overnight repurchase
4.026 4.058 4.087 3.253
4.063 4.094 4.123 3.281
Latest
Week
Latest ago
Euro interbank offered rate (Euribor)
30-year mortgage yields
4.50 4.50 4.50 3.75
3.45 3.45 3.45 2.70
1.475 1.475 1.475 1.475
U.S.
Canada
Japan
—52-WEEK—
High Low
1.78638 1.71794 1.78638 0.94278
2.14500 2.05725 2.14500 1.14678
DTCC GCF Repo Index Futures
Treasury Mar
Treasury Apr
Treasury May
98.365 -0.020 2020 1.635
98.220 -0.015 727 1.780
98.210 -0.015 546 1.790
Discount
2.00
2.00
1.25
1.4200
1.6500
1.4000
1.4100
1.4300
1.4500
1.6500
1.4100
1.4300
1.4500
0.6800
0.8125
0.5000
0.6600
0.6700
2.00
Federal funds
Effective rate
High
Low
Bid
Offer
Net YTD
NAV Chg %Ret Fund
1.4400
1.5625
1.4000
1.4200
1.4400
Net YTD
NAV Chg %Ret Fund
10.71 -0.01 0.2 Lazard Instl
10.42 +0.01 -1.6 EmgMktEq 21.01 -0.07
Lord Abbett A
First Eagle Funds
...
59.19 -0.17 0.2 ShtDurIncmA p 4.21
GlbA
Lord Abbett F
FPA Funds
...
35.43 -0.18 2.1 ShtDurIncm 4.21
FPACres
Metropolitan West
FrankTemp/Frank Adv
10.43 +0.01
IncomeAdv 2.30
... -1.3 TotRetBd
FrankTemp/Franklin A
TotRetBdI 10.43 +0.02
9.82 +0.02
CA TF A p
7.27
... -2.1 TRBdPlan
2.32
... -1.3 MFS Funds Class I
IncomeA p
40.89 -0.40
RisDv A p 61.36 -0.53 0.3 ValueI
MFS Funds Instl
FrankTemp/Franklin C
25.50 -0.04
... -1.4 IntlEq
Income C t 2.35
Mutual Series
FrankTemp/Temp A
GlbDiscA
31.82 -0.17
11.87
-0.02
0.2
GlBond A p
Growth A p 27.45 -0.15 0.7 Oakmark Funds Invest
FrankTemp/Temp Adv
32.51 -0.16
EqtyInc r
87.14 -0.65
GlBondAdv p 11.83 -0.01 0.3 Oakmark
OakmrkInt 28.56 -0.07
Harbor Funds
CapApInst 76.81 -0.03 10.6 Old Westbury Fds
14.83 -0.05
68.09 -0.07 0.8 LrgCpStr
IntlInst r
Oppenheimer Y
Harding Loevner
NA
...
NA
... NA DevMktY
IntlEq
44.56 +0.06
IntGrowY
Invesco Funds A
11.05 -0.06 0.8 Parnassus Fds
EqIncA
43.93 -0.15
ParnEqFd
John Hancock Class 1
LSBalncd
15.40 -0.03 1.4 PIMCO Fds Instl
NA
...
LSGwth
16.45 -0.03 2.3 AllAsset
NA
...
TotRt
John Hancock Instl
PIMCO
Funds
A
DispValMCI 23.85 -0.16 2.3
NA
...
IncomeFd
JPMorgan Funds
MdCpVal L 40.49 -0.20 0.5 PIMCO Funds D
IncomeFd
NA
...
JPMorgan R Class
11.36 +0.01 -1.6 PIMCO Funds Instl
CoreBond
IncomeFd
4.9
-0.2
-0.2
-1.8
-1.7
-1.6
0.2
0.2
0.1
1.0
3.3
...
2.6
NA
2.2
3.0
NA
NA
NA
NA
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.
Net YTD
NAV Chg %Ret Fund
Net YTD
NAV Chg %Ret Fund
... NA IntlEqIdxInst 20.24
...
PIMCO Funds P
Tweedy Browne Fds
IncomeP
NA
... NA GblValue
28.43 -0.13
Price Funds
VANGUARD ADMIRAL
107.67 +0.01 11.8 500Adml 254.87 -1.40
BlChip
28.85 -0.08 2.0 BalAdml
CapApp
35.16 -0.09
33.52 -0.26 0.5 CAITAdml
EqInc
11.56
...
74.02 -0.41 3.2 CapOpAdml r164.50 -0.44
EqIndex
68.72 -0.03 9.7 EMAdmr
Growth
40.08 -0.06
75.14 -0.17 6.8 EqIncAdml 77.79 -0.48
HelSci
40.87
... 10.7 ExplrAdml 94.94 -0.21
InstlCapG
IntlStk
18.95
... 1.5 ExtndAdml 87.73 -0.36
IntlValEq
15.09 -0.01 -0.2 GNMAAdml 10.24 +0.01
MCapGro
92.94 -0.38 6.8 GrwthAdml 77.01 -0.22
MCapVal
30.66 -0.17 0.9 HlthCareAdml r 89.37 -0.32
57.43
... 9.2 HYCorAdml r 5.79 -0.01
N Horiz
9.28 +0.02 -1.7 InfProAd
N Inc
25.23 +0.04
OverS SF r 11.49 +0.01 1.6 IntlGrAdml 102.05 +0.28
NA
... NA ITBondAdml 11.04 +0.01
R2020
NA
... NA ITIGradeAdml 9.49
R2025
...
R2030
NA
... NA LTGradeAdml 10.03 +0.04
R2035
NA
... NA MidCpAdml 197.45 -0.91
R2040
NA
... NA MuHYAdml 11.19 +0.01
Value
37.67 -0.27 0.9 MuIntAdml 13.86
...
PRIMECAP Odyssey Fds
MuLTAdml 11.38 +0.01
AggGrowth r 52.05 +0.07 17.4 MuLtdAdml 10.83
...
42.16 -0.01 13.2 MuShtAdml 15.71
Growth r
...
Principal Investors
PrmcpAdml r141.99 -0.49
DivIntlInst 14.03 +0.02 0.9 RealEstatAdml107.83 +0.16
Prudential Cl Z & I
SmCapAdml 72.63 -0.34
14.22 +0.02 -1.9 STBondAdml 10.28 +0.01
TRBdZ
Schwab Funds
...
STIGradeAdml 10.51
S&P Sel
42.53 -0.24 3.3 TotBdAdml 10.50 +0.02
TIAA/CREF Funds
TotIntBdIdxAdm 21.71 +0.02
20.29 -0.11 3.3 TotIntlAdmIdx r 30.86
EqIdxInst
...
NA
0.3 TotStAdml
-0.2
3.3
1.3
-1.3
7.1
5.0
-0.2
7.4
3.5
-1.5
6.4
3.1
-1.2
-1.4
6.8
-2.3
-2.1
-5.0
3.1
-1.4
-1.4
-1.8
-0.2
0.3
6.3
-8.3
2.6
-0.6
-0.6
-1.8
0.2
1.1
TxMIn r
ValAdml
WdsrllAdml
WellsIAdml
WelltnAdml
WndsrAdml
Net YTD
NAV Chg %Ret Fund
68.93 -0.36 3.3 WellsI
14.43 +0.01 0.1 Welltn
41.72 -0.32 0.7 WndsrII
67.38 -0.48
64.11 -0.06
72.43 -0.19
81.16 -0.41
VANGUARD FDS
26.83 -0.18
DivdGro
HlthCare r 211.90 -0.76
INSTTRF2020 22.72 -0.03
INSTTRF2025 23.12 -0.04
INSTTRF2030 23.44 -0.05
INSTTRF2035 23.76 -0.06
INSTTRF2040 24.08 -0.06
INSTTRF2045 24.29 -0.07
40.37 -0.01
IntlVal
20.02 -0.01
LifeCon
34.25 -0.08
LifeGro
27.42 -0.04
LifeMod
28.16 -0.11
PrmcpCor
30.95 -0.22
SelValu r
27.30 -0.02
STAR
10.51
...
STIGrade
TgtRe2015 15.40 -0.02
TgtRe2020 31.65 -0.04
TgtRe2025 18.71 -0.03
TgtRe2030 34.10 -0.07
TgtRe2035 21.03 -0.05
TgtRe2040 36.47 -0.09
TgtRe2045 22.96 -0.07
TgtRe2050 36.95 -0.10
13.57
...
TgtRetInc
TotIntBdIxInv 10.86 +0.01
0.4
-1.8
-0.2
2.8
1.1
3.1
0.8
1.1
1.4
1.7
1.9
2.1
1.2
0.3
1.7
1.0
4.7
-1.0
1.9
-0.7
0.5
0.9
1.1
1.4
1.6
2.0
2.0
2.1
0.1
0.3
Net YTD
NAV Chg %Ret
26.46 -0.02
41.93 -0.12
37.97 -0.27
VANGUARD INDEX FDS
254.82 -1.40
500
ExtndIstPl 216.49 -0.90
SmValAdml 57.16 -0.39
10.46 +0.01
TotBd2
18.45
...
TotIntl
68.89 -0.36
TotSt
VANGUARD INSTL FDS
BalInst
35.17 -0.09
DevMktsIndInst 14.45 +0.01
DevMktsInxInst 22.58 +0.01
87.73 -0.36
ExtndInst
GrwthInst 77.01 -0.23
InPrSeIn
10.28 +0.02
InstIdx
251.40 -1.38
251.43 -1.38
InstPlus
InstTStPlus 61.44 -0.32
MidCpInst 43.62 -0.20
MidCpIstPl 215.12 -1.00
SmCapInst 72.63 -0.34
SmCapIstPl 209.65 -0.98
...
STIGradeInst 10.51
10.50 +0.02
TotBdInst
TotBdInst2 10.46 +0.01
TotBdInstPl 10.50 +0.02
TotIntBdIdxInst 32.58 +0.04
TotIntlInstIdx r123.42 +0.01
TotItlInstPlId r123.44
...
68.94 -0.36
TotStInst
41.72 -0.32
ValueInst
Western Asset
CorePlusBdI 11.56 +0.03
-1.8
-0.2
0.4
3.2
3.5
0.2
-1.9
1.2
3.3
1.3
0.1
0.1
3.5
6.4
-1.4
3.3
3.3
3.3
3.1
3.1
2.6
2.6
-0.6
-1.8
-1.9
-1.8
0.2
1.1
1.1
3.3
0.7
-1.7
.
B10 | Thursday, March 15, 2018
* *
THE WALL STREET JOURNAL.
BANKING & FINANCE
FICO’s Lock on Credit Scores Under Fire
Provision would require
Fannie and Freddie to
weigh other measures
of creditworthiness
Congress wants to accelerate a shake-up of one firm’s
dominance over the credit
scores used to vet many U.S.
mortgages.
Lawmakers approved a provision as part of the bank-deregulation bill that cleared the
Senate on Wednesday. It
would require mortgage-finance companies Fannie Mae
and Freddie Mac to consider
credit scores beyond Fair
Isaac Corp.’s FICO score for
determining a mortgage applicant’s creditworthiness. Fannie
and Freddie backed nearly half
of all U.S. mortgage dollars
originated in 2017, according
to Inside Mortgage Finance.
The measure, should it become law, would be a big win
for VantageScore, a creditscore system by VantageScore
Solutions LLC, owned by three
large credit-reporting firms:
Equifax Inc., TransUnion and
Experian PLC.
VantageScore is already
used in certain loan sectors
and is FICO’s biggest competitor. FICO remains the dominant score for U.S. consumer
lending. It also has a big hold
on mortgage-related business
because its score is the only
one lenders can use for mortgages they plan to sell to Fannie and Freddie. The mortgage-finance companies don’t
make loans but instead buy
them from lenders and package them into securities that
are sold to other investors.
The matter is already under
review by the Federal Housing
Finance Agency, which regulates the two mortgage-finance firms. In December, it
asked for public feedback on
whether to revamp credit-
HARRISON SHULL/GETTY IMAGES
BY ANNAMARIA ANDRIOTIS
AND LALITA CLOZEL
Fair Issac Corp.’s FICO score is the only one lenders can use for mortgages they plan to sell to Fannie Mae and Freddie Mac.
score rules, including allowing
competition. Some backers of
the provision think the agency
has taken too long to act.
The FHFA declined to comment. Its director, Mel Watt,
told real-estate brokers in August that the credit-score review was “among the most
difficult evaluations undertaken during my tenure” because of the broad impact it
could have on the mortgage
industry. A Republican aide
briefed on the issue said some
lawmakers were worried the
agency might decide against
allowing mortgage lenders to
use an alternative to the FICO
score.
VantageScore has long argued its score could help approve more mortgage appli-
BY DAVE MICHAELS
SIMON DAWSON/BLOOMBERG NEWS
BY PHILIP GEORGIADIS
AND BEN DUMMETT
Prudential PLC CEO Mike Wells
Latin America.
While earnings at Prudential’s insurance and asset-management operations in the U.K.
and Europe have increased 7%
annually over the past 10
years, its Asian operation has
seen a 24% annual rise over
the same period.
Prudential expects Asia’s
expanding middle class to continue to drive that growth by
fueling demand for more savings and life and health insurance coverage. Mr. Wells said
the region’s population is “underprotected” and offers an attractive growth opportunity.
Prudential’s Jackson operation in the U.S., which sells annuities, is also growing at a
faster clip than the U.K. and
European business. Earnings at
the division have climbed 17%
annually over the past 10
years.
As part of the split, Prudential said it sold its U.K. annuities portfolio to insurer Rothesay Life for £12 billion ($16.9
billion). Prudential announced
the moves as it reported annual results for 2017, recording
a 10% increase in operating
profit to £4.69 billion.
IPO Scorecard
Performance of IPOs, most-recent listed first
Company SYMBOL
IPO date/Offer price
% Chg From
Wed3s Offer 1st-day
close ($) price close
Company SYMBOL
IPO date/Offer price
% Chg From
Wed3s Offer 1st-day
close ($) price close
Bridgewater Bancshares 12.62
BWB March 14/$11.75
7.4
...
DFB Healthcare Acquisitions 10.12
DFBHU Feb. 16/$10.00
1.2
1.2
Opes Acquisition
10.02
OPESU March 14/$10.00
0.2
...
Biofrontera
BFRA Feb. 14/$9.98
16.73
67.6
37.4
10.47
–4.8
–5.1
4.84
–3.2
10.5
10.04
0.4
0.3
Motus GI
MOTS Feb. 14/$5.00
Cardlytics
CDLX Feb. 9/$13.00
16.80
29.2
25.7
6.57
64.3
6.3
9.48
–5.2
5.3
BioXcel Thera
BTAI March 8/$11.00
Union Acquisition
LTN.U Feb. 28/$10.00
Farmmi
FAMI Feb. 16/$4.00
Quintana Energy Svcs
QES Feb. 9/$10.00
the mortgage market. “Allowing the credit bureaus to offer
a score they own in a system
where they are the single
point of sale and distribution
for both credit reports and
scores would not increase
competition; it would consolidate their power,” said Joanne
Gaskin, a senior director at
FICO. She added the measure
also would interfere with and
delay the FHFA’s credit-score
review.
Liberal Democrats said the
provision is an untimely gift to
the credit-reporting firms, and
Congress should leave the decision to regulators. “Determining creditworthiness, balancing access to credit with
the need to make sure we
don’t end up with millions of
foreclosures, is a complicated
thing,” said Sen. Sherrod
Brown (D., Ohio), who opposes
the provision and the overall
banking bill. “That’s why we
have FHFA; that’s why we have
a process in place.”
Sens. Tim Scott (R., S.C.)
and Mark Warner (D., Va.)
have championed the change
in the Senate, which this week
is poised to approve the
broader bill easing postcrisis
banking rules. The overall
package has bipartisan support and is expected to clear
Congress and become law.
Some lawmakers decided to
act on the issue after seeing
what they believed were signs
the FHFA might not open up
credit scoring to competition,
the Republican aide said.
Dominant
Fannie Mae and Freddie Mac
backed nearly half of all U.S.
mortgage dollars originated
in 2017.
Fannie's and Freddie's share
of mortgages
75%
50
25
0
2001
’05
’10
’15
Source: Inside Mortgage Finance
THE WALL STREET JOURNAL.
SEC Seeks Trading-Incentives Test
U.K.’s Prudential to
Split Into Two Firms
British insurer Prudential
PLC is splitting its European
and international arms into
two new companies, the latest
example of wide-ranging restructuring of the European
insurance sector.
The 170-year-old firm
said Wednesday it will split off
M&G Prudential, its U.K. and
European business, leaving investors with shares in two separately listed companies with
entirely different business
models.
Prudential—which isn’t related to Prudential Financial
Inc., a U.S. financial-services
provider—will become a solely
international firm, focused on
the U.S., Asia and Africa, and
will be led by current Chief Executive Mike Wells.
M&G Prudential will focus
on its retirement and savings
business in the U.K. and Europe and will pursue a less
capital-intensive structure, following new rules that require
insurers to hold higher levels
of capital.
Shares of Prudential closed
up 5% on the London Stock Exchange.
Prudential’s transformation
comes as the European insurance sector is being reshaped.
While many European insurers have struggled to expand in their home markets,
Asia and other emerging markets have proved far more attractive. That has led to a rise
in deal making.
German insurer Allianz SE
expanded its presence in South
Asia this year, announcing
deals in Sri Lanka and Thailand. Zurich Insurance Group
AG on Monday announced a
deal expanding its presence in
cants, in part because it can
assign a score to consumers
who haven’t used credit in
more than six months. FICO
counters that VantageScore’s
approach, which seeks to give
credit scores to people with
stale or thin credit files, would
lead to less predictive scores
and riskier loans.
“The current system is
completely reliant on outdated
FICO scoring models and that
isn’t serving consumers or
lenders well,” said Barrett
Burns, president and CEO of
VantageScore Solutions. “This
is a productive step towards a
more inclusive housing-finance system.”
FICO said the provision
would help the credit-reporting firms gain more power in
Sources: WSJ Market Data Group; FactSet Research Systems
WASHINGTON—A system of
fees and rebates that promotes trading in stocks would
be reduced under a pilot program proposed by regulators.
Critics of the system, known
as “maker taker,” say it can
distort brokers’ decisions about
where to send orders and attracts high-speed traders
whose strategies sometimes focus on capturing rebates.
The two-year experiment,
now open for public comment,
would allow the Securities and
Exchange Commission to analyze whether reducing the incentives affects where brokers
send orders or curtails the appetite of speedy traders for
some stocks.
Maker taker has been a feature of pricing on stock trading
venues for 20 years. The system
rewards entities that “make”
trades happen by providing
standing orders, known as limit
orders. Exchanges charge a fee
to brokers and investors who
“take” those quotes.
A primary criticism of the
system is that fees pose a con-
flict of interest for brokers,
who might prefer to direct orders to exchanges where rebates are available, instead of
picking venues based on factors such as the probability an
order will be filled. There are
also concerns that investors
pay artificially high trading
fees—particularly for the most
actively traded shares—to offset the rebates that exchanges
offer traders who provide
them with limit orders.
Used by exchange operators
such as Intercontinental Exchange Inc. and Nasdaq Inc.,
maker taker also gets blame
for making the stock market
more complex. Brokers seeking to avoid paying fees have
an incentive to route orders to
bank-owned alternative trading venues known as dark
pools, which unlike exchanges
don’t publish their quotes.
In theory, exchanges could
benefit from lowering the fees
they charge brokers to access
their quotations. That might
prompt brokers to send more
orders to public exchanges, instead of the dark pools.
But exchanges resisted the
pilot program in recent
months, saying it shouldn’t
take the place of a broader examination of how all trading
venues
work,
including
whether dark pools should be
subject to more regulation.
“The current proposal would
thus merely favor the interme-
Critics say brokers
might prefer stock
exchanges where
rebates are available.
diaries whose fees would be reduced at the expense of issuers,
investors,
liquidity
providers and exchanges,”
Cboe Global Markets President
Chris Concannon, Nasdaq Stock
Market CEO Thomas Wittman
and NYSE Group President
Thomas Farley told the SEC in
a letter in October.
“While there may not be
consensus of some of the elements of the pilot, this is one
of the few areas where there is
significant consensus among
market participants that something needs to be done,” said
Brett Redfearn, the SEC’s director of trading and markets.
Exchanges maintain complex pricing schedules, with
bigger traders capturing higher
rebates and retail participants
sometimes paying less to
trade. Trading fees generally
cost 30 cents per 100 shares.
Under the pilot program
approved Wednesday, all exchanges would be required to
test trading on three groups of
stocks with trading fees set
lower than current rates. The
program would also use a control group, with fees set at the
level under existing rules.
For one sample of stocks,
the maximum trading fee
would be 15 cents per 100
shares. A third group would
have trading fees set to 5
cents per 100 shares. In a
fourth group, exchanges
wouldn’t be allowed to offer
any rebate or offer participants a discount on trading
fees in exchange for providing
the market with a large volume of limit orders.
EU Beefs Up Bank Capital
Required for Bad Loans
Wells CEO
Receives
$17.4 Million
BY PATRICIA KOWSMANN
BY EMILY GLAZER
FRANKFURT—The European Union’s executive arm on
Wednesday unveiled a proposal that would force the region’s banks to set aside more
capital to deal with new loans
that turn sour.
Bad debt ballooned in Europe during the financial crisis
as households and companies
lost the ability to repay loans
that accumulated during the
boom years. While outstanding
bad debt is falling amid the
continent’s economic recovery,
banks that continue to struggle to turn profitable have
been slow to take losses on
those loans.
On Wednesday, the European Commission said €910
billion ($1.13 trillion) in nonperforming loans in the EU
are dragging on growth.
Under the plan, which won’t
touch those bad loans, banks
will have to fully write down
unsecured new loans that turn
sour within two years and secured bad loans within eight
years.
The European Banking Authority said that based on estimates that extrapolate the recent high bad-debt levels onto a
20-year horizon, the average European bank would see its common equity Tier 1 ratio, a measure of high-quality capital as a
share of risk-weighted assets,
fall by 2.05 percentage points.
Over seven years, which is
the amount of time national
regulators have to implement
the new rules, the cumulative
hit would be equal to 10% of
retained earnings.
“As Europe and its economy
regain strength, Europe must
seize the momentum and accelerate the reduction of nonperforming loans (NPLs),” said
European Commission Vice
President Valdis Dombrovskis.
The Association for Financial Markets in Europe, which
represents global and European banks, criticized the
move, saying “the appropriate
level of provisioning of NPLs
should be determined on a
bank-by-bank basis in agreement with supervisors.”
The plans still must be approved by states and legislators
and could face resistance, particularly from countries with a
big portfolio of bad loans. In
Greece, NPLs account for almost 47% of total loans. In Italy
and Portugal, that figure is
12.1% and 14.6%, respectively.
Mr. Dombrovskis’ latest proposal also seeks to transfers of
bank loans to potential buyers
in a secondary market and lays
out an out-of-court mechanism
that will speed up the recovery
of the collateral used to guarantee loans that turn sour, which
in some countries can take several years.
Wells Fargo & Co. awarded
Chief Executive Timothy Sloan
$17.4 million in compensation
for 2017, his first full year
leading the embattled bank.
Mr. Sloan received $2.4 million in base pay, with a bonus
that included shares valued at
$15 million. He didn’t receive a
cash bonus, at his recommendation based on Wells Fargo’s
“significant but incomplete
progress on addressing compliance and operational riskmanagement issues,” according to the bank’s proxy. Other
top executives did receive cash
bonuses.
Mr. Sloan’s pay for 2017 was
the lowest compensation for a
major U.S. bank executive. But
it represented a 36% increase
from his total pay package in
2016, when he received $12.83
million. Mr. Sloan was promoted to CEO in October 2016.
.
THE WALL STREET JOURNAL.
Thursday, March 15, 2018 | B11
* * * *
MARKETS
Barclays
Signs Up
A Virtual
Customer
BY AKANE OTANI
BY MARGOT PATRICK
Treasury prices notched
their third straight advance
after data showed retail sales
unexpectedly slipped in February, hinting at some slowdown
in economic momentum early
in the year.
Yields, which fall as bond
prices rise, declined Wednesday following the Commerce
Department’s reCREDIT
port, with the
MARKETS yield on the 10year Treasury
note settling at
2.815%, compared with 2.848%
Tuesday.
The report showed retail
sales fell 0.1% in February,
dragged lower by reduced
spending on cars and gasoline.
Economists surveyed by The
Wall Street Journal had expected to see sales, which
have fallen for three straight
months, rise 0.3%.
The report was the latest to
suggest that the U.S. economy
continues to evade signs of
overheating, even as the unemployment rate has held
steady at a nearly two-decade
low, confidence among consumers and businesses has
generally risen, and gains from
a $1.5 trillion tax-cut package
are expected to lift spending
among Americans.
“Investors are on inflation
watch, but so far it still looks
pretty benign,” said Paula Solanes, a portfolio manager at
SVB Asset Management.
Fears that a rise in inflation
and growth could push the
Federal Reserve to pick up its
pace of interest-rate increases
helped spur a wave of Treasury selling in February, with
the yield on the 10-year note
experiencing its biggest onemonth advance since the end
of 2016. Inflation is a threat to
government bonds because it
chips away at the purchasing
value of their fixed returns.
Yet in recent weeks, reports
including consumer prices and
wage growth have suggested
that inflation pressures remain muted. That has helped
support Treasurys, which typically look more attractive to
investors when they are uncertain about the economic
outlook.
Bonds have also strengthened as fears of retaliation to
U.S. tariffs on steel and aluminum imports have pushed investors into the safety of government debt.
Barclays PLC has become a
rare global bank to embrace
the cryptocurrency sector by
signing exchange operator
Coinbase as a customer.
Deposits from Coinbase users in the U.K. will be held in a
new customer account at Barclays, Coinbase U.K. Chief Executive
Zeeshan
Feroz
said Wednesday, amid what he
called “a huge surge of interest” in the country to trade
bitcoin and other digital currencies.
Mr. Feroz said the European
Union, led by the U.K., was
Coinbase’s fastest-expanding
market in 2017. The San Francisco-based startup plans to
have hundreds of people working in its London headquarters
by the end of the year, up
from dozens now, he said.
Working with Coinbase is a
big stride for Barclays into a
sector that many banks have
shunned for being too risky.
Bitcoin and other cryptocurrencies aren’t backed or controlled by any government,
and global regulators are still
grappling with how to supervise trade in the currencies
and related activities.
Mr. Feroz said Barclays’s involvement showed how perceptions have changed toward
the sector as it seeks to shake
off its early image as a haven
for illicit activity. A spokesman for Barclays declined to
comment, citing client confidentiality.
Mr. Feroz said Coinbase has
also received a license from
the U.K. financial regulator to
issue electronic money and
provide payment services in
the U.K. and across the EU. He
said Coinbase already followed
regulatory rules on new customer checks and anti-moneylaundering procedures, but
that the Financial Conduct Authority authorization shows
the company’s compliance
programs and operational
standards are “on par with
traditional financial services
business.”
Coinbase users in the U.K.
can’t deposit or withdraw
funds in their home currency. They must be made in
euros through a process that
takes at least a day and involves a bank in Estonia. Tapping into the U.K.’s Faster Payments Scheme via Barclays,
the transactions can be made
in sterling immediately.
TRAVIS DOVE/BLOOMBERG NEWS
Treasury
Prices Rise
For Third
Day in Row
Boeing was among the worst performers in the Dow Jones Industrial Average in Wednesday’s trading, tumbling 2.5%.
Stock Indexes Extend Fall
Renewed worries tied
Retail Drop
to tariffs follow signals Nordstrom, Kohl’s and Macy’s shares fell Wednesday after
of few exclusions, talk data showed Americans cut spending at retailers in February.
1%
of an EU retaliation
BY AMRITH RAMKUMAR
AND RIVA GOLD
Shares of industrial and materials firms pushed the Dow
Jones Industrial Average and
S&P 500 lower for the third
straight session, as investors
weighed new signs that protectionist trade policies could
spread.
Stocks had come under
pressure earlier in the month
as investors worried that U.S.
tariffs on steel and aluminum
could hurt companies that use
the metals
WEDNESDAY’S to manufacMARKETS
ture goods.
And some
are
concerned that other countries
might retaliate, slowing international trade and eventually
weakening global growth.
While the White House appeared to soften its initial
stance on trade policy last
week, helping stocks recoup
some of their losses, stocks
and bond yields came under
fresh pressure Wednesday after the Commerce Department
signaled that few product exclusions to the tariffs would be
granted to U.S. companies.
Germany’s newly re-elected
chancellor, Angela Merkel, also
said the European Union needs
to respond with one voice to
Performance, minute by minute
Nordstrom
Macy’s
Kohl’s
0
–1
–2
–3
–4
9:30 10
11
noon
Source: WSJ Market Data Group
the U.S. tariffs and shouldn’t
be afraid to impose its own
trade measures, if necessary.
“It just seems like the market is kind of resigning itself to
this trade-war narrative,” said
Yousef Abbasi, global market
strategist at JonesTrading.
The Dow Jones Industrial
Average closed down 248.91
points, or 1%, at 24758.12, after
opening higher. The S&P 500
fell 15.83 points, or 0.6%, to
2749.48, while the Nasdaq
Composite declined 14.20
points, or 0.2%, to 7496.81.
Aerospace giant Boeing was
among the worst performers in
the blue-chip index Wednesday, sliding $8.41, or 2.5%, to
$330.26, and slicing 58 points
off the Dow industrials.
Shares of materials compa-
1
2
3
4
THE WALL STREET JOURNAL.
nies in the S&P 500 fell 1.3%,
with all but one stock in the
sector posting losses for the
day, while the S&P 500 industrial sector lost 1.1%.
Despite renewed trade worries, stocks have largely stabilized following a wave of volatility in February that sent the
S&P 500 and Dow industrials
into correction territory. The
S&P is 4.3% below its high set
on Jan. 26, while the Dow industrials are 7% from their record that day.
Investors attribute stocks’
recovery to recent data pointing to more measured economic growth, which they
hope will keep the Federal Reserve on a gradual path of interest-rate increases.
Last month, many investors
feared that significantly higher
inflation would give the Fed a
freer hand to raise rates more
quickly than anticipated, pushing up bond yields and making
stocks less attractive.
“That’s a very legitimate debate for the market to have
and for the market to be worried about,” said Ben Laidler,
global equity strategist and
head of Americas research at
HSBC. “We’re definitely in the
slightly-more-sanguine camp.”
Still, division among investors over interest-rate increases could continue contributing to market swings,
analysts said.
On Wednesday, the Labor
Department said a gauge of
U.S. business prices rose 0.2%
in February, a sign of modest
inflation pressure. Americans
cut spending at retailers in
February for the third consecutive month despite receiving
bigger paychecks, the Commerce Department said.
Shares of department stores
and apparel sellers fell following the downbeat retail-sales
data. Kohl’s shed 1.86, or 2.9%,
to 62.25. Nordstrom fell 85
cents, or 1.7%, to 49.48.
Signet Jewelers slid 9.69,
or 20%, to 38.22, after the jewelry seller said same-store
sales fell more than expected
in the most recent quarter and
said it planned to close some
stores.
Stocks were lower in Asia
early Thursday. Japan’s Nikkei
Stock Average was down 0.9%,
while Hong Kong’s Hang Seng
Index was off 0.7%.
Dropbox Pitches IPO to Investors
BY MAUREEN FARRELL
The Cushing® Renaissance Fund
Transferable Rights Offering for Common Shares
NYSE Symbol “SZC”
NYSE Rights Symbol “SZC RT”
Record date was February 16, 2018
Last trading day for rights is March 21, 2018*
Offer expires March 22, 2018*
*Unless extended
For more information and a prospectus, contact:
DAVID PAUL MORRIS/BLOOMBERG NEWS
Leading up to its initial
public offering, Dropbox Inc.
executives have spent the past
few days pitching potential investors on the company’s ability to reach an expansive user
base of 500 million and its
growth potential, according to
people who attended the
meetings.
On Wednesday as part of
the company’s so-called roadshow to peddle its IPO, Dropbox Chief Executive Drew
Houston, Chief Financial Officer Ajay Vashee and Chief Operating Officer Dennis Woodside addressed about 200
investors who crowded into a
ballroom at the Lotte New
York Palace Hotel in Manhattan.
The executives touted Dropbox’s potential for accelerating
growth and its likelihood of
turning a profit, seeking to
portray the company as one
less dependent on an active
sales force and instead a service that tends to sell itself to
users who become advocates,
according to people who attended the meetings.
Dropbox’s IPO is slated to
be the largest U.S. technology
debut since Snap Inc. went
public in 2017, based on its expected valuation of between
$7 billion and $8 billion.
Dropbox’s IPO price—and
its early days of trading—will
be closely watched for signs of
whether more highly valued
tech companies could be enticed to tap public markets instead of remaining in the wellcapitalized private markets.
Just three technology IPOs
had listed in the U.S. in 2018
through Tuesday, raising $2.7
Call Toll-Free: +1-888-613-9988
Dealer Manager
CEO Drew Houston says the most important thing to its users is ‘the sharing, the collaboration.’
billion, according to Dealogic.
These companies’ shares are
trading up 27% on average,
Dealogic data show.
Several potential Dropbox
investors said the scarcity of
technology IPOs is helping
$8B
Expected valuation of Dropbox
after its IPO.
boost interest in Dropbox’s debut as a rare, high-growth
tech company with a sustainable business model.
Some potential investors
said the company’s current
price target of $16 to $18 a
share is conservative, and they
think it could be raised before
the company starts trading
next week on the Nasdaq. The
Dropbox IPO will seek to raise
$612 million at the midpoint
of its range, and the company
said it would receive proceeds
of $529.7 million at that midpoint.
Still, Dropbox’s current expected price range sets it far
below the $10 billion valuation
at which the company had
raised private capital in 2014.
Pricing can change up until
the night before a company
starts trading.
Dropbox and its underwriters, which include Goldman
Sachs Group Inc. and JPMorgan Chase & Co., will set a final IPO price based on feed-
back from investors over the
next week.
Mr. Houston and others
spelled out the use case for
Dropbox as a collaboration
tool for businesses and consumers rather than simply a
web-storage company.
In an investor video released ahead of the roadshow,
Mr. Houston highlighted the
company’s evolution: “We’ve
realized the most important
thing to our users wasn’t the
storage. It’s the sharing, the
collaboration.”
Whether investors are willing to accept that broader
concept of Dropbox’s business
likely will be a key to how the
company prices and trades
and a crucial consideration for
investors as they decide how
to value the business.
March 15, 2018
An investment in The Cushing® Renaissance Fund, a non-diversified, closedend management investment company, is subject to investment risk, including
the possible loss of the entire principal amount invested. Investment return
and the value of shares will fluctuate. The rights offering is subject to certain
risks, including economic dilution and voting dilution.
All of the costs of the rights offering, including offering expenses and sales load,
will be borne by the Fund and indirectly by all of its Common Shareholders, including those who do not exercise their Rights. The rights are transferable and have
been admitted for trading on the NYSE during the course of the offer; however,
there can be no assurance that a market for the rights will develop.
Investors should carefully consider the Fund’s investment objectives and policies,
risks, and charges and expenses before investing. The Fund’s prospectus, which
contains this and other information about the Fund, is available by calling
the phone number listed above. An investor should carefully read the Fund’s
prospectus before investing.This communication is not an offer to sell these
securities and is not soliciting an offer to buy these securities, nor shall there be
any sale of these securities in any state where the offer, solicitation or sale is not
permitted.
UBS Securities LLC is acting as dealer manager for the rights offering. In the
U.S., securities underwriting, trading, and brokerage activities and M&A advisory
activities are provided by UBS Securities LLC, a registered broker/dealer that is a
wholly owned subsidiary of UBS AG, a member of the New York Stock Exchange
and other principal exchanges, and a member of SIPC.
© UBS 2018. All rights reserved.
.
B12 | Thursday, March 15, 2018
THE WALL STREET JOURNAL.
* ***
MARKETS
Transportation Stocks Step on the Gas
BY AKANE OTANI
Shares of airlines, railroads
and truckers are catching up
with the broader stock market
after a slow start to the year, a
relief to investors worried that
poorly performing transport
stocks often presage a broader
market downturn.
The Dow Jones Transportation Average, which tracks the
performance of companies
ranging from railroad operator
CSX Corp. to airline giant
United Continental Holdings
Inc., has rallied this month,
cutting its losses for the year
to 0.4%.
The transports are now
closing in on the broader Dow
Jones Industrial Average,
which after stalling out in
March is up 0.2% for the year.
The transportation sector’s
rebound is encouraging investors who had questioned why
transports lagged behind in
the first two months of the
year even as data showed the
unemployment rate was hovering near a 17-year low, the
U.S. economy was on pace to
accelerate again and corporate
earnings were growing.
The
Dow
transports
dropped 2.2% in January and
February, while the Dow industrials rose 1.7%.
The disconnect between the
two indexes was a worrying
sign to proponents of the
roughly century-old Dow
theory. They believe declines
in the Dow transports often
hint at broader weakness in
the economy—and signal a
steep market selloff could be
ahead.
Over the past decade, the
two indexes have had a correlation of 0.98, according to
WSJ Market Data Group,
meaning they tend to move in
the same direction.
But some analysts and investors say that the early underperformance of transportation stocks had more to do
with a string of downbeat analyst reports at the start of the
The Dow Jones Transportation Average, which includes shares of truckers, rental-car operators and railroads,
has narrowed its losses for the year after stumbling in February.
8%
6
Index
performance
4
Dow Jones
Industrial
Average
2
0
Dow Jones
Transportation
Average
–2
–4
–6
–8 January
February
U.S. gross domestic product,
change from the same quarter a year earlier
March
Index performance, quarterly
Five biggest month-to-date gainers
in the Dow Jones Transportation Average
Dow transports
4%
15%
RECESSION
7.3%
Avis Budget Group
2
6.1%
JetBlue Airways
0
5.9%
Matson
5.8%
–2
CSX
–4
United Continental
Holdings
Seasonally adjusted
2007
2010
Dow transports
4.3%
2.4%
*Data for first quarter 2018 are preliminary.
Sources: FactSet (indexes, gainers); Commerce Department (GDP)
year, rather than underlying
weakness in the U.S. economy.
And they say the recent resurgence of transport stocks underlines that the broad economic
outlook
remains
positive.
“I’m not suggesting we ignore any macro message from
the transports—they may be
telling us that there are some
industry-specific issues out
there—but the underlying
macroeconomic message is
still a positive one,” said Liz
Ann Sonders, chief investment
strategist at Charles Schwab.
Airline shares, for instance,
took a tumble the first two
months of the year amid rising
investor concerns that expansion plans among carriers
would lead to excess capacity
as well as a price war.
Yet as jet fuel prices have
slid, lowering costs for airline
operators, many shares in the
industry have since rebounded.
Shares of Southwest Airlines Co., the No. 1 U.S. budget
carrier, fell 12% in the first
two months of the year, while
Spirit Airlines Inc. lost 11%
and Delta Air Lines Inc.
slipped 3.8%. All three stocks
are up more than 3% so far for
March.
“We expect the airlines to
update [first-quarter 2018] in-
vestor guidance, and suspect
the updates will be positive
given relatively modest industry capacity growth in 1Q18,
declining jet fuel costs, and
continued global economic improvement,” Helane Becker, an
analyst at Cowen & Co., said in
a research note.
Another stock that has rebounded in recent weeks is
freight railroad CSX, whose
shares are up 5.8% for the
month after losing 2.4% in the
first two months of the year.
Analysts said the company’s
presentation in early March at
a New York investor conference, which included outlining
plans to slash capital spending
5
0
–5
–10
2013
’14
’15
Storm Surge
Furniture and home-furnishing sales, change from the previous month
2.0%
1.5
1.0
0.5
0
–0.5
–1.0
–1.5
2017
’18
Source: Commerce Department
about one in which extra
money many Americans are
seeing as a result of the tax
cut really isn’t all that meaningful, with middle-class incomes not receiving enough
THE WALL STREET JOURNAL.
of an income boost to move
the needle and upper-class
households not motivated to
spend more than they already do?
The real answer might be
more prosaic: Hurricanes
late last summer set off a
bout of spending on replacement goods in the fall. Once
that demand was exhausted,
a lull in spending followed.
Motor-vehicle and parts
sales, for example, rose 5.1%
in the three-month period
ended in November, and fell
2% in the three months that
followed. Sales at furniture
and home-furnishing stores
rose 3.5% in the three-month
period ended in November,
and then fell 2.3%.
The lull won’t last forever.
In short order, job-market
strength and fatter paychecks should begin to push
retail sales higher. There
may be reasons to worry
about the U.S. economy, but
Americans’ ability to spend
money shouldn’t be one of
them.
—Justin Lahart
Big Winners in Bill to Help Small Banks
Size Matters
Cash on deposit with the Federal
Reserve and other central banks,
end-2017
JPMorgan Chase
$370 billion
BNY Mellon
92
Northern Trust
41
State Street*
34
*Refers only to deposits in
excess of required minimums
Source: the companies
State Street, with $238 billion; and Northern Trust
Corp., at $139 billion. These
banks are more important
than they might seem because they manage or have
under custody trillions of
dollars of assets.
These custody banks specialize in safekeeping the securities of institutional investors like mutual funds.
Under the bill, they would be
able to exclude some depos-
its they hold at the Federal
Reserve or other central
banks from their total assets
when calculating total leverage. No other banks, big or
small, get such a benefit.
The argument is that assets held at the Fed are free
of risk, so banks shouldn’t
have to hold capital against
them. The custody banks
hold a disproportionate
share of Fed deposits.
The impact could be quite
significant. Keefe, Bruyette
and Woods analyst Brian
Kleinhanzl estimates the
change could boost earnings
per share at the two biggest
custody banks by around 8%,
assuming they use the freedup capital to invest in other
profit-generating assets.
JPMorgan Chase and
Citigroup, which have their
own custody businesses,
aren’t granted the same exemption. This exclusion appears to be due to them still
having negative reputations
on Capitol Hill. Helping them
out would jeopardize the
bill’s chance of passage.
Still, it makes no sense
that central-bank deposits, if
they are truly risk-free, be
treated differently for different banks. The U.S. Treasury’s report on financial regulation last year proposed
that all banks be able to exclude Fed deposits from their
leverage ratios. It also is jarring that such big custody
banks will benefit from a bill
designed to help smaller
banks.
The fact that Congress
narrowed the exemption to
three banks that happen not
to be household names says
something about the current
political climate. Even with
Donald Trump in the White
House and Republicans controlling Congress, politicians
don’t want to appear to be
doing anything to help the
most well-known Wall Street
banks.
—Aaron Back
’16
’17
’18*
THE WALL STREET JOURNAL.
and cut jobs, helped reassure
them that the company can
execute its turnaround plan.
Still, even as transportation
stocks have recouped some of
their February losses, they remain far behind the year’s topperforming shares, many of
which are in the technology
and consumer-discretionary
sectors.
Neither the blue-chip index
nor the Dow transports has
set a fresh high since January.
In comparison, the tech-heavy
Nasdaq Composite is up 8.6%
for the year, well ahead of the
Dow industrials’ 0.2% gain.
Among the standouts in the
technology space are stream-
FINANCIAL ANALYSIS & COMMENTARY
Don’t Fret About U.S. Consumers
Three of the biggest winners, in a bill meant to help
small and midsize banks, are
anything but.
The bill, championed by
Senate Banking Committee
Chairman Mike Crapo, would
raise the threshold for
stricter oversight by the Federal Reserve to $250 billion
in assets from $50 billion, a
boon for midsize regional
lenders. It also contains measures to reduce the burden
of regulation on smaller
community banks.
Thanks to this focus, it
garnered enough Democratic
support to pass in the Senate, despite strong opposition from the likes of Sen.
Elizabeth Warren, who calls
it a gift to Wall Street.
Another group of banks
that dwarf these small lenders stands to get a healthy
profit boost if the bill goes
through: Bank of New York
Mellon, with $372 billion of
assets on its balance sheet;
10
HEARD ON THE STREET
Email: heard@wsj.com
Consumer spending has
gotten off to a rocky start
this year. Don’t expect that
to continue.
Retail sales weakened for
the third month in a row in
February, slipping even as
the job market’s strength
and tax cuts seem like they
should have prompted people to buy more. Overall retail sales slipped by 0.1%, the
Commerce Department reported Wednesday, versus
the gain of 0.3% economists
expected. Excluding automobile purchases, sales increased by 0.2%. Economists
expected a 0.4% gain.
It is possible to spin a tale
about how Americans have
become more unsettled
about the outlook and are
opting to save more in order
to build up a buffer against a
weaker economy. Or how
Dow industrials
ing service Netflix Inc., whose
shares have soared 68% since
the start of the year on the
back of strong subscriber
growth; Amazon.com Inc., up
36%, and Cisco Systems Inc.,
which has gained 18%.
“The transportation industry has just been ignored,”
said Tom Stringfellow, president and chief investment officer of San Antonio-based Frost
Investment Advisors.
As long as economic data
stay positive, the sector is
poised to pick up in coming
months, Mr. Stringfellow
added.
—Allison Prang
contributed to this article.
WSJ.com/Heard
Nike Investors Should
Switch to Team Adidas
Nike investors should cast
their eyes across the Atlantic
where Adidas is running
faster and its stock is inexplicably cheaper.
The German sportswear
group, long dominant in
Western Europe, has been
making up for lost time in
the U.S. and China—the
world’s two largest markets.
For its two brands, adidas
and Reebok, constant-currency sales surged 27% in
North America last year as
adidas in particular took
market share from an enfeebled Nike. The group growth
rate was 16%, after 18% in
2016, according to results
filed Wednesday.
Reflecting on the U.S.
turnaround, Chief Executive
Kasper Rorsted, dressed in a
hoodie, told reporters that
Adidas may have been earlier than its peers to exploit
the “athleisure” trend, where
activewear has become fashionable.
Adidas also has learned
the hard way that Americans
like different sports than
soccer-obsessed Europeans
do.
Adidas still has room to
run in the U.S. The company’s market share in athletic footwear is roughly 11%,
compared with more than
20% outside the U.S., according to Andreas Inderst, an
analyst at Macquarie.
As importantly, Adidas
has been improving its operating margin—historically a
weak spot. Last year it hit
9.8%, up from 8.6% in 2016,
prompting Mr. Rorsted to
upgrade his 2020 target to
11.5% from 11%.
The shares rose 11%, in
part due to a €3 billion
($3.71 billion) multiyear
share buyback program announced late Tuesday. Yet
excluding cash they still
trade at 16 times operating
profits, compared with 21
times for Nike.
This difference, which has
emerged since November, is
hard to explain in terms of
the companies’ performance.
Nike’s constant-currency
sales rose just 3% in the
most recent quarter through
November, as the company
continued to lose ground in
North America. There also is
more potential for margin
improvement at the German
group.
Investing isn’t about diehard team allegiance. Nike
supporters would do well to
decamp to Adidas.
—Stephen Wilmot
OVERHEARD
In fast food, imitation may
not be the sincerest form of
flattery. There is a long history
of chains clamping down on
those selling similarly named
products or using names and
logos that bear a striking resemblance to their own.
Britain’s BBC profiled the
owner of Fernando’s, a restaurant serving “peri-peri” style
Portuguese chicken whose
name isn’t Fernando but Asam
Aziz. He says he came up with
the name from a game show,
but Nando’s, an international
chain serving Portuguese periperi chicken with an almost
identical rooster logo, smells a
cock and bull story, accusing
him of trademark infringement.
Mr. Aziz might take solace
from other supposedly innocent fast-food clones such as
MacDavid’s, Pizza Huh, Sunbucks, and KFC clones KFG,
KLG and OFC. The difference is
that all of those were in countries with weak intellectualproperty regulation, not Britain.
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