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The Wall Street Journal May 2 2018

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WEDNESDAY, MAY 2, 2018 ~ VOL. CCLXXI NO. 102
* * * * * *
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YEN 109.86
A
Apple
Allays
iPhone
Worries
Xerox’s CEO is resigning
in a settlement with two of
its biggest investors, putting
a deal with Fujifilm at risk. B1
BY TRIPP MICKLE
South Korea Turns Down the Volume as Trump Talks Up Summit
What’s
News
Business & Finance
pple said it plans a record $100 billion stock
buyback as it posted strong
gains in sales and profit
despite modest growth in
iPhone shipments. A1
AllianceBernstein plans
to move its headquarters
and New York staff to Nashville, Tenn., to cut costs. B1
Tesla’s SolarCity unit is
facing slowing installations
and potential issues with
promises to investors. B1
U.S. auto sales slowed
in April amid a continued
decline in demand for sedans and compact cars. B2
Lantern Capital topped
the bidding for Weinstein Co.
and is close to acquiring the
entertainment company. B3
BP shares hit levels not
seen since shortly after the
2010 oil spill as higher crude
prices led to solid results. B3
MetLife’s finance chief
resigned after a pay cut
tied to weaknesses in internal financial controls. B12
The Dow fell but pared
earlier losses, closing down
64.10 points at 24099.05. B13
Facebook plans to launch
a dating feature, even as it
battles user-data issues. B4
Pfizer’s revenue was little changed as it shifts to a
new generation of drugs. B5
CHUNG SUNG-JUN/PRESS POOL/EPA/SHUTTERSTOCK
Chinese tech “unicorns”
with collective valuations of
some $500 billion have held
talks about possible IPOs
this year or in early 2019. B1
Company to buy back
$100 billion in stock
from investors as
profit soars 25%
BORDER CONTROL: South Korean soldiers on Tuesday removed high-decibel loudspeakers used to broadcast propaganda along the
border with the North. President Trump said he expected details of his planned meeting with Kim Jong Un to be announced soon. A9
Trump Moves Renew Trade Strains
BY WILLIAM MAULDIN
AND BEN EISEN
The Trump administration
has set the stage for weeks of
heightened tension between the
U.S. and its trading partners as
administration officials race to
meet self-imposed deadlines to
complete a series of high-stakes
negotiations with China, Mexico, Canada and Europe.
A U.S. trade delegation
left Tuesday for China hoping
to glean trade concessions from
Beijing, while earlier in the day
U.S. Trade Representative Robert Lighthizer confirmed, after
months of wrangling with Mexico and Canada, a mid-May
deadline for the renegotiation
of the North American Free
Trade Agreement. And the administration set a new June
1 deadline to come to agreement with European officials on
steel and aluminum tariffs.
The developments position
May as a crucial month for
President Donald Trump to fulfill a campaign promise to rewrite the rules of trade, with
the aim of reducing U.S. deficits
and protecting American workers. The combative approach to
trade has been popular with Mr.
Trump’s base—and many Democrats—but has heightened economic uncertainties that are
likely to spark more volatility in
the stock and commodities markets.
Mr. Trump has delegated the
details of these trade initiatives
to Mr. Lighthizer and other senior administration officials,
from Commerce Secretary Wilbur Ross to Treasury Secretary
Political Arguments
Consume Google
Bumping Into the New Boss
World-Wide
Trump’s administration
is racing to meet self-imposed deadlines to complete
trade talks with China, Mexico, Canada and Europe. A1
Pompeo promised to restore the State Department’s “swagger” in his
first address to employees
as secretary of state. A4
Rosenstein pushed back
against a group of GOP lawmakers who demand that
the Justice Department turn
over certain documents. A4
The Pentagon has begun
a probe of White House
physician Jackson amid
misconduct allegations. A4
California is suing the
Trump administration over
its decision to ease vehicleemissions standards. A2
The Treasury amended
its Russian sanctions, paving
the way for aluminum giant
Rusal to exit the blacklist. A2
An Arizona wildfire has
consumed 11,000 acres and
may portend a busy fire
season across the West. A3
The NIH is recruiting
volunteers for a genetic database that will include
over one million people. A2
Iran has been courting
European nations as questions mount over the future of the nuclear deal. A8
CONTENTS
Banking & Finance... B12
Crossword.............. A14
Heard on Street. B14
Life & Arts....... A11-13
Markets............. B13-14
Middle Seat........... A11
Opinion.............. A15-17
Property Report B6-7
Sports....................... A14
Technology.......... B4-5
U.S. News............. A2-6
Weather................... A14
World News. A8-9,18
>
s Copyright 2018 Dow Jones &
Company. All Rights Reserved
Holding Sway
Apple quarterly revenue and
share from the iPhone
The tech giant struggles to tame a
workplace culture of nonstop debate
BY KIRSTEN GRIND
AND DOUGLAS MACMILLAN
MANDEL NGAN/AGENCE FRANCE-PRESSE/GETTY IMAGES
Afghan security forces
are fraying as Islamic extremists gain control of
more territory, according
to a new U.S. report. A1
The first female pilot in
Afghanistan, who has faced
death threats, has been
granted U.S. asylum. A3
Steven Mnuchin. But he also
has made clear that the key to
success rests with the president
alone, an unpredictable negotiator who rarely shows his hand.
“The discussions will take
place in Beijing,” said senior
White House adviser Peter Navarro, before jumping on a
flight to Beijing, but “the decisions will take place in Washington.”
Mr. Lighthizer confirmed on
Tuesday that, from his perspective, the window to renegotiate
Please see TRADE page A6
Apple Inc. flexed its financial muscle with a record $100
billion plan to buy back stock
from investors, as it reported
strong gains in revenue and
profit even as growth in the
number of iPhones sold remained weak.
The results for Apple’s fiscal second quarter reflect a
fundamental transformation
reshaping the world’s most
valuable company, turning a
business centered on how
many devices it ships into one
built around high-end features
and services for those devices.
Apple’s report Tuesday
capped a string of strong earnings from U.S. tech giants including Amazon.com Inc.,
Google parent Alphabet Inc.,
and Facebook Inc., all of which
continued to thrive despite
business challenges and rising
concern from regulators, politicians and others about the
technology industry’s power
and practices.
Revenue from the iPhone,
which still accounts for most
of Apple’s sales and profit,
rose 14% to $38 billion in the
quarter, which ended in March.
That came despite a modest
3% increase in the number of
iPhones shipped, thanks to
higher average prices driven
by the $1,000 iPhone X
launched last year.
Apple further assuaged concerns about its future with a
forecast for total revenue in the
current quarter of between
$51.5 billion and $53.5 billion,
which would represent a healthy
Please see APPLE page A2
Ingrid Newkirk, cofounder and president of
People for the Ethical Treatment of Animals, flew to Silicon Valley earlier this year
for a long-planned speech to
Google employees. It wasn’t
until she sat waiting in a
parking lot that a call came
through notifying her the
event was canceled.
Ms. Newkirk had been invited by some employees to
discuss her view that animals can be subject to prejudice just as people can, as
part of the company’s “Talks
at Google” series. Another
TOUR OF DUTY: Mike Pompeo, President Trump’s new secretary of
state, greeted State Department employees as he arrived on the
job Tuesday after visits to Israel, Saudi Arabia and Jordan. A4
U.S. Report
Points to
Setbacks in
Afghanistan
BY CRAIG NELSON
KABUL—Afghanistan’s security forces are fraying as Islamic extremists gain control
over more territory, a U.S.
government watchdog said,
raising questions about progress in the yearslong project
to make Afghans responsible
for their country’s defense.
Afghan military and police
forces, the cornerstone of
American strategy to stabilize
the country and prevent it
from becoming a staging
ground for terrorist attacks
abroad, have shrunk by about
10% in the past year, according
to a report released Tuesday
by John F. Sopko, the Special
Inspector General for Afghanistan Reconstruction.
At the same time, the report said, the Taliban and
other Islamist militant groups
Please see SECURE page A8
group of employees said the
topic was offensive to humans who face racism, and
they protested.
“Google has these values,
and with our talks, we have
to align with these values,” a
Google employee told Ms.
Newkirk, according to a transcript of the call.
Such is the climate inside
the tech giant, where fractious groups of employees
have turned the workplace
into a virtual war zone of
debate over all manner of
social and political beliefs.
Google has long promoted a
work culture that is more
like a college campus—where
Please see GOOGLE page A10
Now Emoting in the Corner
Office: The Oversharing CEO
i
i
Jessica Mah’s employees
and investors know details
about her dating life, fights
with her mother and that time
she threw up at Burning Man,
the annual bacchanal held in
the Nevada desert.
“What haven’t I
shared?” asked Ms.
Mah, chief executive
of inDinero Inc., a
privately held San
Francisco accounting software firm.
When Ms. Mah
Cry
relayed
stories
about mishaps she’s had with
her hobby—flying airplanes—a
couple of investors requested
she boost her life insurance
policy. She’s offered a
$100,000 bonus to any employee who can find her a husband.
CEOs have long led with
swagger, preaching about their
successes and keeping their insecurities, failings and intimate moments out of public
view. Now, in some offices, the
image of the polished boss is
starting to fade as chiefs find
that baring it all—even the bad
stuff—can
be
good for business.
Ms. Mah is a
believer: People
like you when
they feel they
with me
know you, she
says, and highlighting struggles inside the
business helps keep investor
expectations from running too
hot.
“I don’t try to pretty it up
at all,” she said. “If they think
they know me better, they’ll
Please see SHARE page A10
2Q 2018
Total
Apple
revenue
$61.1B
80
60
40
iPhone
revenue
$38B
20
0
FY 2015
’16
’17
’18
Source: the company
THE WALL STREET JOURNAL.
Snap’s results fall below
estimates...................................... B5
Heard on the Street: Apple still
charges up with iPhone....... B14
Salesforce.
#1 CRM.
i
Leaders open up about hopes, fears and
arguments with mom; building trust
BY RACHEL FEINTZEIG
$100 billion
Ranked #1 for CRM Applications based on
IDC 2017H1 Market Share Revenue Worldwide.
19.9%
8.4%
6.1%
2013
2014
2015
2016
2017H1
Source: IDC Worldwide
Semiannual Software
Tracker, October 2017.
salesforce.com/number1CRM
© 2018 salesforce.com, inc. All rights reserved. Salesforce.com is a registered
trademark of salesforce.com, inc., as are other names and marks.
.
A2 | Wednesday, May 2, 2018
* ***
THE WALL STREET JOURNAL.
U.S. NEWS
California Sues on Emissions Plan
U.S. Gives Rusal Path
To Escape Sanctions
BY ALEJANDRO LAZO
AND TIMOTHY PUKO
The Trump administration
on Tuesday amended its Russia
sanctions program, paving the
way for aluminum giant United
Co. Rusal to escape from the
blacklist and granting the metals market a reprieve from a
supply scare that rocked markets over the past month.
Facing delisting from the
London Stock Exchange this
week, Rusal’s owner, EN+
Group, sought the 11th-hour
amnesty from the U.S. Treasury
late last week by pledging that
its majority shareholder and a
primary target of the U.S. sanctions, Russian tycoon Oleg Deripaska, would reduce his holdings and relinquish his board
seat.
On Tuesday evening, the
Treasury granted EN+ Group
and several other companies an
SAN FRANCISCO—California Gov. Jerry Brown said his
state was suing the Trump administration over its decision
to ease national vehicle-emissions standards.
Mr. Brown said the lawsuit
challenges the Environmental
Protection Agency’s decision
to revise tailpipe emissions
rules that go into effect in
2022 for vehicle models
through 2025, saying the
move was a violation of the
Clean Air Act and the Administrative Procedures Act. California holds a waiver that allows it to set its own
emissions guidelines for auto
makers, and many states follow California’s lead.
The suit was filed in the
United States Court of Appeals
for the District of Columbia
Circuit, a news release from
BY IAN TALLEY
extension for compliance with
the sanctions, buying Rusal’s
owner time to implement the
company’s proposed divestment plan.
Aluminum prices have whipsawed over the past several
weeks as the initial sanctions in
early April risked cutting off a
major supplier from markets.
But prices fell as the Treasury
began to signal a way for Rusal
to avoid sanctions.
En+ executives and their
representatives have scrambled
in recent days to convince
White House, State Department
and Treasury officials that the
administration risked missing
an opportunity to force Mr. Deripaska out of control if they
didn’t grant an extension and
the company was delisted from
the London Stock Exchange, according to a person familiar
with the matter.
the governor’s office said. A
total of 17 states—and the District of Columbia—representing about 140 million people
and more than 40% of the car
market are suing.
The Trump administration
has decided to lower—and
may even eliminate—increases in vehicle-emissions
requirements that car makers
say don’t work in an era of
cheap gasoline. With pump
prices low, drivers are buying
more fuel-gobbling trucks
and sport-utility vehicles,
making it more difficult for
auto makers to raise the average fuel economy for the
vehicles they sell.
The Obama administration
had aimed by 2025 to raise
that figure to the rough equivalent of 36 miles per gallon in
real-world driving.
The Trump administration
didn’t get California to agree
to the changes despite its spe-
cial legal authority to set rules
that are now adopted by about
a third of the country’s car
market. And California officials are joining other critics
who say the Trump administration hasn’t provided enough
research to prove its decision
isn’t arbitrary and is legally
justified.
“You can’t, just like some
tinhorn dictator, say I’m tearing up a rule that was built on
two years of building up evidence,” Mr. Brown said at a
news conference broadcast
from Sacramento.
EPA Administrator Scott
Pruitt is “running roughshod
over the laws of this country
and the health of our people,”
the governor said.
An EPA spokeswoman declined to comment, citing
pending litigation.
California’s Air Resources
Board, which polices tailpipe
emissions in the state, is coor-
U.S. WATCH
TAIMY ALVAREZ/SOUTH FLORIDA SUN-SENTINEL/ASSOCIATED PRESS
Navy Musicians Keep Spirits Afloat at Children’s Hospital
SHOWBOAT: Navy Band Southeast musicians at the Salah Foundation Children’s Hospital in Fort Lauderdale, Fla., on Tuesday.
APPLE
Continued from Page One
increase from a year ago.
Meanwhile, Apple said the
number of paid subscriptions
for services ranging from HBO
to Apple Music rose to 270 million in the period, an increase
of 100 million people in a year.
Revenue from the services
business jumped by nearly a
third to $9.19 billion, accelerating from the previous quarter.
The combination drove total
revenue up 16% to $61.14 billion in the latest period, Apple
said. Profit rose 25% to $13.82
billion, its highest level for a
March quarter.
“With the services that we
have now and others that we
are working on, I think that
this is just a huge opportunity
for us and feel very good about
the track that we’re on,” Chief
Executive Tim Cook said during a call with analysts.
Apple’s $100 billion sharerepurchase plan is the largest
ever announced by a U.S. company, according to data from
research firm Birinyi Associ-
The $1,000 price for
the iPhone X has
counteracted slowing
growth in shipments.
ates. Apple said its board also
approved a 16% increase in its
quarterly dividend.
Apple already had paid out
$275 billion to shareholders
through March since it resumed returning capital to
them in 2012, including $200
billion in share repurchases.
The increase in Apple’s capital return comes after it announced in January it would
bring the majority of its $269
billion in overseas cash holdings back to the U.S. That followed the major U.S. tax overhaul President Donald Trump
signed into law late last year,
which requires companies to
pay a one-time tax of 15.5% on
overseas profits held in cash.
Apple didn’t give a timeta-
ble for implementing the new
buybacks. Luca Maestri, Apple’s chief financial officer,
said in an interview that
given the size of the planned
buybacks “it’s going to take
us some time to execute,” but
“our plan is to do it at a fast
pace.”
Sluggish growth in the
number of iPhones shipped
over the past six months has
fueled investor concerns
about the outlook for Apple’s
marquee business, as people
hold on to smartphones longer and competition from
homegrown rivals intensifies
in China, once its fastestgrowing market.
Apple’s stock has stalled this
year, after investors sent its
share price up 45% last year on
hopes that the feature-rich X
model would help recharge
growth. The device’s price tag
has damped demand, say analysts, who expect another year of
low, single-digit growth in the
number of iPhones Apple ships.
Apple shares closed at
$169.10 on Tuesday ahead of
the earnings report, even as
shares in other tech giants including Amazon Inc. have continued to rise. The shares rose
more than 3% in after-hours
trading.
“The high end of the smartphone market where Apple is
dominant is very mature,” said
Arif Karim, a senior investment analyst at Ensemble Capital Management, a Burlingame, Calif., wealth manager
that counts Apple among its
largest holdings. He said the
huge shipment increases the
iPhone once enjoyed are
“dead.”
The services business has
become one of Apple’s biggest
growth engines, with revenue
in its last fiscal year rising 23%
to $30 billion. Apple aims to
lift that number to $50 billion
by 2020.
The company has 1.3 billion
iPhones and other devices in
active use and earns an estimated $30 per device on music
subscriptions, app store purchases and other services, according to Morgan Stanley,
which expects services to account for about 60% of Apple’s
revenue growth over the next
five years.
Buyback King
COMPANY
ANNOUNCED
April 2015
Apple
April 2013
General Electric
April 2015
$100 billion
50
50
50
Microsoft
Sept. 2008
40
Microsoft
Sept. 2013
40
Microsoft
Sept. 2016
Apple
April 2016
40
35
Apple
May 2017
Apple
April 2014
35
30
Microsoft
July 2004
30
Procter & Gamble
Aug. 2007
30
What Apple has spent, per quarter, in repurchasing shares since
announcing in 2013 plans to buy back $50 billion of stock
$25 billion
20
15
10
5
0
2013
’14
’15
RESEARCH
Texas, Other States
Sue to End DACA
NIH Seeks Volunteers
For Medical Database
Texas and six other states
are suing to end a program that
would protect from deportation
young, undocumented immigrants brought to the U.S. as
children.
The lawsuit announced on
Tuesday came a week after a
federal judge in Washington ordered the Trump administration
to resume the Deferred Action
for Childhood Arrivals program.
Immigrants under the
Obama-era program are commonly referred to as Dreamers.
Republican Texas Attorney
General Ken Paxton had threatened legal action for the past
year if the program didn’t come
to a halt.
Joining Texas in the lawsuit
are Alabama, Arkansas, Louisiana, Nebraska, South Carolina
and West Virginia.
The judge called the Department of Homeland Security’s rationale against the program “arbitrary and capricious.”
He gave the Trump administration 90 days to make a new
case.
—Associated Press
The National Institutes of
Health has begun recruiting volunteers for a $1.46 billion medical database that will eventually
comprise data on more than one
million people, an effort to discern the genetic underpinnings
of a range of diseases and even
of healthy aging.
The endeavor is aimed at deciphering the workings of poorly
understood maladies ranging
from cancers to migraines to dementia. The database will be
open to medical researchers and
will initially consist of data on
volunteers age 18 and up, regardless of health status.
The program, called All of Us,
has already enrolled more than
25,000 people in its pilot stage
but will be recruiting more in
communities large and small in
public events beginning Saturday
in New York, Chicago, Detroit, Birmingham, Ala.; Kansas City, Mo.;
Nashville, Tenn.; and Pasco, Wash.
—Thomas M. Burton
United Continental to
Resume Flying Pets
AMOUNT
April 2018
Apple
IMMIGRATION
AIRLINES
Even before Tuesday, Apple has announced some of the biggest
planned repurchases of stock.
Apple
’16
’17
’18
Notes: Time periods for implementing buybacks may vary. Apple's quarterly payments are
based on the calendar year.
Sources: Birinyi Associates (biggest buybacks);
S&P Dow Jones Indices
dinating with the governor
and the Democratic Attorney
General Xavier Becerra.
A protracted legal battle
would be problematic for auto
makers that have long called
for a single national standard
for vehicle emissions. Having
to meet two sets of standards
is confusing for buyers and
costly for auto companies, executives and analysts say.
California had coordinated
with the Obama administration on new standards that
had anticipated increased fuel
economy in part from growing
consumer demand for electric
cars and hybrid vehicles, neither of which are profitable
for companies to make.
While sales of electric cars
have gained modest momentum amid Tesla Inc.’s rise and
others joining that market,
buyers often complain about
battery power, cost and a lack
of charging options.
THE WALL STREET JOURNAL.
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United Continental Holdings
Inc. will resume flying dogs and
cats in July, after reviewing pettransport rules in the wake of a
dog’s death in an overhead bin.
United’s PetSafe program will
resume carrying animals, but only
certain breeds of cats and dogs
in the cargo holds of its planes.
United said it will also discontinue pet transport to and from
airports, including Las Vegas, during the hot summer months.
More pets have died on
United flights in recent years
than on those operated by rival
airlines. In March, a dog died inside a carry-on bag after a flight
attendant told a passenger to
stow the bag in an overhead bin,
unaware the bag contained a
puppy. That same week, United
mistakenly sent a dog bound for
Kansas to Japan. United apologized for both incidents and
vowed to review its pet-transport policies.
United said it continues to review its policies for taking pets
in the cabin.
Problems with pets have
soared in recent years along
with the number of animals being brought on flights.
—Doug Cameron
CYCLISTS’ DEATHS
Michigan Driver
Is Guilty of Murder
A reckless driver who was on
drugs when his pickup truck
crashed into a pack of bicyclists,
killing five, was convicted of second-degree murder on Tuesday
in southwestern Michigan.
Charles Pickett’s trial lasted
just a few days in Kalamazoo
County. There was no dispute
that he had swallowed painkillers
and other drugs before driving,
although his lawyers argued that
murder charges were excessive.
He now faces up to life in prison
at his sentencing on June 11.
Mr. Pickett’s truck plowed
into a pack of bicyclists on a rural road in June 2016.
—Associated Press
SOUTHWEST PLANE
Trump Hails Bravery
Of Passengers, Crew
President Donald Trump on
Tuesday hailed the “tremendous
bravery” of the crew and passengers aboard a damaged Southwest Airlines plane that was
forced into an emergency landing in Philadelphia last month.
Mr. Trump also paid tribute to
Jennifer Riordan, a 43-year-old
Wells Fargo bank executive from
Albuquerque, N.M., who died of
injuries suffered after she was
partially sucked out of a window.
—Associated Press
CORRECTIONS AMPLIFICATIONS
A crowdfunding campaign
for BauBax 2.0, a travel
jacket, has raised more than
$109,000 on Indiegogo InDemand. A Journal Report article Tuesday about crowdfunding campaigns incorrectly
said BauBax 2.0 raised more
than $4 million on Indiegogo
InDemand.
than 2,000 companies are
currently using its automated
sales assistants, generating
$30 million in annual recurring revenue. A Journal Report article Monday about using artificial intelligence to
find customers misstated the
annual recurring revenue as
$18 million.
Ripa Rashid is co-president of the Center for Talent
Innovation. A Journal Report
article Tuesday about sexual
harassment incorrectly said
she is managing partner.
Green Street Advisors
provided the data for a chart
of REIT prices relative to
their assets published Saturday with a Heard on the
Street article about real-estate stocks. The source was
incorrectly listed as FactSet.
Conversica Inc. says more
Readers can alert The Wall Street Journal to any errors in news articles by
emailing wsjcontact@wsj.com or by calling 888-410-2667.
.
Wednesday, May 2, 2018 | A3
THE WALL STREET JOURNAL.
U.S. NEWS
Arizona Wildfire Portends a Busy Season
A wildfire in Arizona that has consumed more than 11,000 acres and prompted evacuations is the first large-scale blaze of the year in the West, but more are expected.
and was most immediately
threatening the small unincorporated community of
Happy Jack, where many people have vacation homes, Mr.
Smith said. The Coconino
County Sheriff’s Office has
ordered evacuations for several communities threatened
by the fire.
The strong winds were unusual for this early in the season, Mr. Smith said, and the
fire has been exacerbated by
the lack of snowpack this
winter throughout the Southwest.
The Arizona snowpack is
well below normal at 13% of
the historical median, accord-
ing to an April 1 report by the
Agriculture Department.
“It is drier, it has been
warmer and these winds have
been unusually high for this
time of the year,” Mr. Smith
said. For those reasons, “we
are projecting a very busy
and severe fire season
throughout the Southwest.”
©T&CO. 2018
A fast-spreading wildfire
moving through central Arizona—consuming 11,000 acres
of land and prompting the
evacuation of more than 1,000
people by Tuesday morning—
marks the start of what experts
say will be a particularly busy
fire season across the West.
The Tinder fire is the first
large-scale wildfire of the year
in the West and has been burning in the Coconino National
Forest since April 27. Fire officials warned that dry conditions will lead to more blazes
in the coming months.
The Arizona fire roared out
of control Sunday, when wind
gusts of 40 to 45 miles an hour
spread the flames, said Rico
Smith, a federal wildfire
spokesman.
As of the latest update
Tuesday morning, 559 personnel including 15 crews, six helicopters, 40 engines, three bulldozers and 10 water tenders
had arrived to combat the
11,420-acre blaze, digging fire
lines by hand and with bulldozers, as well as working on
search-and-protect missions.
Federal fire officials warned
of a danger of “spotting”—the
dispersal of fire far beyond the
main line because of flying embers. Windblown embers
helped fuel the deadly Tubbs
wildlife in Sonoma County, Calif., in October that killed at
least 22 people and destroyed
more than 2,800 homes in
Santa Rosa.
The latest blaze is burning
in the mountains about 40
miles south of Flagstaff, Ariz.,
U.S. FOREST SERVICE/ASSOCIATED PRESS
BY ALEJANDRO LAZO
AND JIM CARLTON
Female Afghan Pilot Gets U.S. Asylum
BY MARGHERITA STANCATI
old when she enrolled in the Afghan military, hoping to achieve
her lifelong dream of becoming
a pilot. The U.S.-led military coalition touted her as an example
of what Afghan women could
accomplish under the Westernbacked government in Kabul.
However, her story ultimately exposed the limits of
what women could accomplish
in a deeply conservative country
where U.S.-led efforts to em-
JAWAD JALALI/EPA/SHUTTERSTOCK
Afghanistan’s first female
airplane pilot, who became a
symbol of women’s advancement during America’s war effort there, has been granted
asylum in the U.S.
Niloofar Rahmani, a former
Afghan Air Force captain, left
her native country in 2015 to receive training in the U.S.—and
to escape death threats directed
at her and her immediate family. The U.S. military brought
her to America and paid for her
training. Now, U.S. authorities
have recognized it is too dangerous for her to return home.
“I’m really happy and
thankful to all the people who
made this happen,” Ms. Rahmani, 27 years old, said Tuesday. “All I want now is to go
back to my dream of flying.”
Ms. Rahmani was 18 years
Niloofar Rahmani received death threats after she finished pilot-training school in Afghanistan.
power them have frequently
clashed with local culture.
Shortly after she graduated
from pilot-training school in
2013, Ms. Rahmani became a
public figure. That is when the
death threats began. She became a target for the Taliban insurgency as well as for members of her own extended family
—uncles and cousins who
considered her profession
shameful and wanted to punish
her to avenge family honor.
Ms. Rahmani’s parents and
siblings, who had supported her
career choice, also faced threats,
forcing the whole family into
hiding. Her older brother narrowly escaped two assassination attempts. Ms. Rahmani’s
family remains in Afghanistan,
except for a sister who moved to
the U.S. recently. In Afghanistan, her close family members
are fearful for their lives and
continue to live in hiding.
Since completing her training
aboard C-130 transport aircraft
in the U.S., Ms. Rahmani’s life
has been in limbo as she
awaited an answer to her asylum request. Now that she has
been granted it, she hopes she
can find a job in civil aviation.
—Habib Khan Totakhil
contributed to this article.
As Cities Gentrify, Tenants Find Help
BY ALEJANDRO LAZO
AND LAURA KUSISTO
SAN FRANCISCO—Sergio
Martinez spent many sleepless
nights after learning the rentcontrolled apartment complex
where he lived with his family
would be sold.
In the rapidly gentrifying
Mission District, he had
watched as scores of other
families had been priced out,
and he feared his family’s turn
had come, he said.
Then a neighbor tipped him
off to a potential lifeline: a local nonprofit was purchasing
private buildings to help keep
low-income tenants like him in
the neighborhood.
Similar efforts are popping
up in New York, Philadelphia,
Portland, Ore., and other highcost cities as low-income residents find themselves in gentrifying neighborhoods.
The measures, some public
and some private, include offering down-payment assistance on homes to people with
historic ties to neighborhoods,
passing ordinances aimed at
restricting gentrification and
assisting nonprofits that are
buying buildings where tenants are at risk of eviction.
Policy makers say they are
uncertain about the best remedies as rents in most U.S.
cities march higher. Many debate whether the efforts drive
up rents for others, by making
development more expensive,
or whether the moves are too
little, too late.
“Sometimes the rhetoric is
about stopping gentrification,”
said Vicki Been, a New York
University law professor. “In a
market system you’re limited
in your ability to do that.”
Ms. Been was head of the
New York City Housing Preservation and Development De-
The measures are
helping low-income
residents stay
in neighborhoods.
partment when the city rezoned East New York, a
historically poor, predominantly African-American and
Hispanic neighborhood just a
subway stop or two from areas with quickly rising rents.
The goal was to spur new affordable housing construction,
but residents protested the
new units would be too costly.
San Francisco’s Mission
District, historically a center
of Latino activism and culture
transformed in recent years by
an influx of affluent residents,
has been a contentious gentrification battleground. The
area lost 26% of its Latino
population from 2000 to 2016,
as that same population over
that period increased citywide,
according to Veritas Urbis
Economics, a consulting firm.
Most people rent in the
Mission. And there has been a
49% citywide increase in rents
over the past eight years, according to property tracker
RealPage Inc.
Many buildings where
lower-income people live are
privately owned and have
been kept affordable for decades by weak demand and
lack of investment. Public officials have little leverage to get
landlords to keep rents low
when units suddenly become
desirable.
The Mission Economic Development Agency, a local
nonprofit, began buying buildings in 2016 through San Francisco’s small sites program,
which allows private buildings
to be converted to affordable
housing units if enough income-eligible tenants agree to
the change. The group’s efforts are supported by city
funds as well as donations
from charitable organizations,
including the Citi Foundation,
which recently provided MEDA
with a $500,000 grant.
Karoleen Feng, director of
community real estate for
MEDA, said she often targets
buildings with deferred maintenance, those requiring expensive retrofits to meet San
Francisco’s earthquake standards, and homes where landlords and tenants both want to
work out a deal that won’t result in displacement.
Mr. Martinez, 51 years old,
came to the U.S. from Mexico in
1994, and his wife, Ana Lopez,
54, arrived from Peru the next
year. The couple met in the
Mission and had a son and twin
daughters. In 2003, the family
moved into the 2½ bedroom
apartment. The family says the
spacious flat has provided them
with stability that has allowed
them to succeed. Their son,
Sergio, is attending Princeton
University this year, they said.
In the case of the Martinez
building, three higher-income
tenants living in one of the
building’s three flats agreed to
a rent increase, allowing the
numbers to work.
The family members were
relieved when MEDA closed on
the building last year, as they
had few other options to stay
in the city. “We really didn’t
have time to think about anything else,” Ms. Lopez said.
A TIFFANY MOTHER’S DAY
TIFFANY CELEBRATION® RINGS
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.
A4 | Wednesday, May 2, 2018
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THE WALL STREET JOURNAL.
U.S. NEWS
Pompeo Vows to Restore Agency
State Department
diplomats complained
they were sidelined
under his predecessor
Pruitt
Loses Two
Senior
Staffers
BY HEIDI VOGT
WASHINGTON—The new
secretary of state, Mike
Pompeo, promised to restore
the State Department’s “swagger” in his first address to employees on Tuesday after a
whirlwind tour of Israel, Saudi
Arabia and Jordan over the
weekend.
Mr. Pompeo was greeted in
the State Department’s packed
lobby with lengthy applause
and cries of encouragement on
his first day of work in the
building.
State Department employees have expressed hope that
Mr. Pompeo’s influence at the
White House will help elevate
the department’s role in policy
making after diplomats complained of feeling sidelined under his predecessor in the job,
Rex Tillerson.
“I talked about getting back
our swagger, and I’ll fill in
what I mean by that,” Mr.
Pompeo said. “But it’s important the United States diplomatic corps needs to be in every corner, every stretch, of
the world.”
At the top of the agenda in
Mr. Pompeo’s first week in office will be President Donald
Trump’s decision on whether
to pull out of the Iran nuclear
deal by his self-imposed deadline of May 12.
Concerns about Tehran’s influence in the Middle East and
the its nuclear program dominated Mr. Pompeo’s inaugural
WASHINGTON—Two senior
Environmental
Protection
Agency staffers have left their
posts, another sign of turmoil
at an agency facing a number
of investigations over Administrator Scott Pruitt’s management and spending.
The EPA confirmed in a
statement Tuesday that Albert
“Kell” Kelly, the head of the
Superfund program, and
Pasquale “Nino” Perrotta, the
EPA’s security chief, had left
the agency. Messrs. Kelly and
Perrotta couldn’t be reached
for comment.
Mr. Pruitt is under investigation by the White House, inspector general of the EPA,
House oversight committee
and Government Accountability Office over spending on security, lodging and travel,
along with allegations that he
pushed out staffers who criticized his decisions. He has denied the allegations and noted
that ethics officers cleared the
actions.
Mr. Perrotta is scheduled to
appear for a transcribed interview with House oversightcommittee staffers Wednesday
and an aide said that would
still go ahead. “His resignation
will not impact his appearance
before the committee.”
Mr. Perrotta oversaw actions taken in the name of Mr.
Pruitt’s security, including a
$43,000 secure phone booth in
his office, first-class travel and
a security detail during personal travel including a trip to
Disneyland.
Democrats have raised questions about whether Mr. Kelly
should have had a position of
such responsibility at the EPA
after Oklahoma regulators
banned him from the banking
industry.
Mr. Pruitt praised both men
for their service. He didn’t provide any details on the reason
for their departures, and the
EPA declined to comment beyond its statement.
Rep. Don Beyer (D., Va.),
who recently asked the EPA’s
inspector general to investigate
Mr. Kelly’s hiring and work at
the agency, said he was never
qualified to run Superfund.
Others, however, praised Mr.
Kelly’s work to improve and
speed the process of cleaning
up the Superfund hazardouswaste sites.
“Mr. Kelly really did appear
to be a champion for these
sites,” said Dawn Chapman,
head of a nonprofit called Just
Moms STL that has long campaigned for the cleanup of a
polluted St. Louis landfill.
—Louise Radnofsky
contributed to this article.
MANDEL NGAN/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY JESSICA DONATI
New Secretary of State Mike Pompeo, center, told staffers on Tuesday that he aimed to bring back the State Department’s ‘swagger.’
trip last weekend, where he
joined with Israel’s leader in
lambasting Iran over its alleged violations of the 2015
agreement.
Mr. Pompeo returned to
Washington on Monday after
visiting Brussels, Riyadh, Tel
Aviv and Amman following his
swearing-in. By making Saudi
Arabia and Israel among the
first destinations on his first
official trip abroad, Mr.
Pompeo underscored the
deeper relationship Mr. Trump
has tried to develop with the
two countries.
Mr. Trump also visited
Saudi Arabia and Israel on his
first official foreign trip and
has sought closer ties with Riyadh as a bulwark against Iran.
Mr. Pompeo, a graduate of
West Point and a former Army
captain, represented Kansas in
the House of Representatives
from 2011 to 2017, before being
picked by Mr. Trump to serve
as director of the Central Intelligence Agency.
As the former CIA director,
Mr. Pompeo had a reputation
for efficient management, and
staff at the State Department
hope the new secretary will
move swiftly to fill top jobs
that have been vacant for the
past year.
Department staff in the
crowd commented on the large
turnout of employees, although one person observed
that the timing of the short
speech—delivered
during
lunch
hour—might
have
helped.
Mr. Pompeo provided few
details about his plans for the
department, but promised to
listen to employees’ concerns,
reflecting a common complaint
among the workforce.
“I know that I have an enormous amount to listen to you
about and to learn from you,”
he said. “I know that we will
deliver for this president and
for this country.”
Mr. Tillerson was unpopular
from the start after arriving
with plans to implement a proposal to slash a $55 billion
budget by almost 40%. While
Congress blocked steep cuts to
the State Department this
year, the Trump administration has proposed similar cuts
for next year.
Rosenstein Pushes Back Against Critics in GOP
Deputy Attorney General
Rod Rosenstein pushed back
against a group of Republican
lawmakers who say he should
lose his job for resisting their
demands that the Justice Department turn over documents
related to politically sensitive
probes.
“There have been people
making threats privately and
publicly against me for quite
some time,” Mr. Rosenstein
said Tuesday. “They should
know by now the Department
of Justice is not going to be
extorted, and that any kind of
threats that anybody makes
are not going to affect the way
we do our job.”
Mr. Rosenstein, who has
previously maintained a more
nonconfrontational tone in his
public comments, also warned
against what he said were the
pitfalls of allowing Congress
too much access to continuing
investigations.
MICHAEL REYNOLDS/EPA/SHUTTERSTOCK
BY SADIE GURMAN
Deputy Attorney General Rod Rosenstein speaks at the Newseum.
Mr. Rosenstein’s comments—during an event at the
Newseum, a museum on the
media—came as he faces pressure from Republican lawmakers to produce documents involving the department’s
investigation into former Secretary of State Hillary Clinton’s use of a private email
server, a lingering source of
dissatisfaction in the GOP.
His comments also came after disputes with GOP lawmakers over the Justice Department’s investigation of Russian
interference in the 2016 election. Mr. Rosenstein has been
overseeing the Russia probe,
which is run by special counsel
Robert Mueller, since Attorney
General Jeff Sessions recused
himself last year.
Members of the House
Freedom Caucus, a group of
about three dozen conservatives, have been circulating a
draft of articles of impeachment against Mr. Rosenstein, a
GOP aide said Tuesday.
Mr. Rosenstein criticized
those behind the impeachment
draft for leaking it to the
press. “I don’t have anything
to say about documents like
that that nobody has the courage to put their name on,” Mr.
Rosenstein said.
The Freedom Caucus chairman, Rep. Mark Meadows (R.,
N.C.), said Mr. Rosenstein’s response to the impeachment
threat was “reminiscent of our
interactions with him over the
past few months: a lot of rhetoric with very little facts.”
Mr. Meadows reiterated his
view that Mr. Rosenstein has
been uncooperative. “If he believes being asked to do his
job is ‘extortion,’ then he
should step aside and allow us
to find a new deputy attorney
general,” Mr. Meadows said.
The articles of impeachments would have to pass the
House in order to move forward, which is unlikely to happen. A spokeswoman for
House Speaker Paul Ryan (R.,
Wis.) pointed to comments
from January when Mr. Ryan
said that he saw “no reason”
for President Donald Trump to
fire Mr. Rosenstein, and that
he was doing a “fine job.”
Mr. Rosenstein also said on
Tuesday that while he welcomes oversight, it would be
dangerous to “just open our
doors to allow Congress to
come and rummage through
the files.”
Mr. Rosenstein visited the
White House recently to discuss the congressional requests and the plan for addressing them.
—Natalie Andrews
contributed to this article.
Pentagon Probes White House Physician
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BY NANCY A. YOUSSEF
WASHINGTON—The Pentagon has begun an investigation into Navy Rear Adm.
Ronny Jackson, who served as
the personal physician for
three presidents until misconduct allegations emerged last
week, dooming his bid to become secretary of veterans
affairs.
The Defense Department’s
Office of Inspector General is
conducting the probe into allegations against Dr. Jackson
and will decide afterward
what further investigation or
action should be taken, Pentagon spokesman Tom Crosson
said in a statement.
The Pentagon didn’t detail
the specific allegations being
reviewed or their source. Dr.
Jackson was accused by Sen.
Jon Tester (D., Mont.), the senior Democrat on the Senate
Veterans’ Affairs Committee,
of mistreating lower-ranking
employees, drinking to excess
on overseas trips, and handing out prescription drugs.
Mr. Tester has said the allegations were based on complaints by active-duty and retired military officers who
had worked in the White
House Medical Unit and who
had come to the committee.
The Navy and the Navy Bureau of Medicine and Surgery
have their own Offices of Inspector General and could be
tasked with the investigation.
Dr. Jackson gave up his po-
MICHAEL REYNOLDS/EPA/SHUTTERSTOCK
A beautiful
bond.
Navy Rear Adm. Ronny Jackson, shown last week, is under investigation amid allegations of misconduct.
sition as President Donald
Trump’s personal physician
when he was nominated to be
VA chief. In a statement announcing his decision to withdraw from the cabinet-level
nomination, Dr. Jackson called
the allegations “completely
false and fabricated.”
Dr. Sean Conley, a Navy
commander who has worked
at the White House since December 2016, has been named
to take his place as the president’s physician. Dr. Conley
joined the Navy in 1998, military records show.
Dr. Jackson, after dropping his bid to win Senate
confirmation, resumed his
work at the White House
Medical Unit, White House
officials said, but no longer
leads that unit.
U.S. defense officials have
said the Navy only learned of
the allegations presented by
Mr. Tester during Dr. Jackson’s nomination battle. During his tenure at the White
House, Dr. Jackson was under
the supervision of the White
House Military Office and
largely outside the traditional
Navy chain of command.
Military officials last investigated Dr. Jackson in 2013,
when the Navy Bureau of
Medicine and Surgery looked
into charges that Dr. Jackson,
then a captain, and a fellow
Navy captain had created an
unhealthy environment at the
White House office they led
while Dr. Jackson served as
the president’s physician, defense officials said. Dr. Jackson and his colleague were allowed to stay in their jobs.
Mr. Trump nominated Dr.
Jackson in March to the rank
of two-star rear admiral. The
Navy said he remains a candidate for the second star,
which would be conferred
through a decision by the
Senate.
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | A5
GROUP BENEFITS
LIFE
ANNUITIES
RETIREMENT
ADVICE
Lincoln Financial acquires Liberty Mutual’s
group benefits business, becoming an
even stronger industry leader.
To our customers, brokers and employees,
I am excited to announce that Lincoln Financial has completed the acquisition of
Liberty Mutual Insurance’s group benefits business. While both businesses are
market leaders in their own right, our combined capabilities will make us even stronger,
as we become one of the nation’s most powerful group benefits insurers:
■ #1 market share in combined, fully insured disability sales1
■ #3 market share in combined total life and fully insured disability sales1
■ 40,000 employers, with 10 million employees
■ 8,000 brokers and consultants
■ Comprehensive products offered — disability, absence management, life,
dental, vision, accident and critical illness
■ 100 years of combined experience and strong financial ratings
■ Scale that enables greater innovation and investments to better
serve our customers
Lincoln Financial group benefits is now bigger, better and broader — with greater
capabilities to find the right solution for each customer, delivered with the same level
of compassion, integrity and expertise that you’ve come to trust. If you have not yet
experienced the power and confidence that come with doing business with Lincoln,
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LincolnFinancial.com
LCN-2095456-041918. © 2018 Lincoln National Corporation. All rights reserved. Lincoln Financial Group and Lincoln Financial are the marketing
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and in New York, Lincoln Life & Annuity Company of New York, Syracuse, NY.
[1] Source: Based on LIMRA, new sales premium, as of 12/31/17.
Liberty Mutual Insurance is the marketing brand for Liberty Mutual Group Inc. and its related subsidiaries, including Liberty Life Assurance Company
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A6 | Wednesday, May 2, 2018
THE WALL STREET JOURNAL.
* ***
U.S. NEWS
Maine Gov. Paul LePage is
going out swinging in his final
months in office, maintaining
his record-smashing veto pace
and still refusing to kick-start
the Medicaid expansion that
voters approved last fall.
The administration of Mr.
LePage, a Republican barred
by state constitution from
seeking a third term, missed
an April deadline to begin securing federal money for the
planned July 2 Medicaid expansion that he has called a
“boondoggle.” He says he
won’t act until legislators
meet his funding conditions
for the program, leaving the
rollout on shaky ground and
prompting a lawsuit from advocates Monday.
The expansion referendum—the first such ballot initiative in the nation—was ap-
proved by 59% of Maine
voters. It extended Medicaid
health benefits to low-income
adults, making Maine the 32nd
state to adopt a key plank of
the Affordable Care Act. The
state would provide up to 10%
of the funding for newly eligible people in the expansion
under the national law.
“He’s just made a decision
that, ‘it’s not going to happen
under my watch,’ ” said Republican state Sen. Thomas
Saviello, who supports the expansion. “He wants to be the
winner over Obamacare when
he leaves office.”
The governor’s office said
Mr. LePage was watching out
for Maine’s budget, which has
a projected surplus this year.
“It’s totally about financial
stability to him,” said spokeswoman Julie Rabinowitz.
Mr. LePage vetoed five attempts by the legislature to
Citing budget concerns, Republican Gov. Paul LePage has vetoed
five attempts to expand Medicaid for lower-income residents.
expand Medicaid under the
ACA and said the ballot initiative would “kill this state.”
Mr. LePage and other expansion opponents cited
Maine’s costlier-than-expected
attempt in the early 2000s to
broaden Medicaid eligibility.
Supporters said current reimbursement arrangements
and policies made this a different scenario.
“The voters sent a clear
message,” said Robyn Merrill,
executive director of Maine
Equal Justice Partners, the
lead advocacy group behind
the ballot measure and one of
several organizations that
sued in state court Monday,
seeking to force Mr. LePage’s
administration to take action
on the expansion.
The governor’s office said it
doesn’t comment on pending
litigation.
The referendum left the
legislature to decide how to
pay for its portion of the Medicaid expansion, but the governor is making that tricky.
In a letter to legislators,
Mr. LePage pledged he
wouldn’t execute the expansion until lawmakers met his
conditions. He took multiple
funding sources off the table
and warned about “budget
gimmicks.”
Side Effects
Trade concerns may be a factor in slowing job growth in U.S. regions
most affected by proposed U.S. and Chinese tariffs and a bump in
U.S. steel prices as metal buyers race to secure supplies.
U.S. job creation, subdivided
by states with significant
production of steel, aluminum,
cars, aircraft and soybeans
Not significant production
Significant production
Shanghai-traded steel rebar futures
DANIEL ACKER/BLOOMBERG NEWS
20
BY LOUISE RADNOFSKY
60
10
40
0
20
–10
Gymnastics coaches Bela
and Martha Karolyi filed suit
Tuesday against USA Gymnastics and the U.S. Olympic Committee, saying they are owed
indemnification for legal costs
in the fallout of the Larry Nassar sexual-abuse scandal.
The Karolyis also say they
are victims of breach of contract after USA Gymnastics
failed to buy the couple’s
ranch where Nassar is alleged
to have assaulted many of his
elite gymnast victims.
Both USA Gymnastics and
the USOC declined to comment on the lawsuit.
The suit is the latest in a
thicket of litigation arising
from accusations that, as the
U.S. women’s gymnastics team
doctor and an osteopathic
physician at Michigan State
University, Nassar assaulted
hundreds of gymnasts and
other women and girls under
the guise of treatment. He is
currently serving an effective
life sentence after being convicted of several sexual-assault
–20
4Q ’17 Jan. ’18
TRADE
Continued from Page One
Nafta will close in mid-May if it
is to be approved by the current
session of the U.S. Congress.
Separately, the White House
granted the European Union
and other allies a new, extended
deadline of June 1 to come up
with concessions to address the
U.S. trade deficit, or face tariffs
on steel and aluminum. That
came as a relief to some foreign
capitals, but the move also extended uncertainties until
month’s end.
Meanwhile, the senior U.S.
delegation to China comes as
part of a monthslong effort by
the U.S. to turn up the pressure
on Beijing. Mr. Lighthizer said
his office will accept public
comments on the first round of
levies—$50 billion in tariffs on
Chinese imports—until May 22.
After that, he said the U.S. can
legally impose the tariffs and
promises more volatility in everything from commodities
prices to stock valuations as the
business community grapples
with the uncertainty.
Washington’s threats to impose tariffs already have been
rattling Wall Street. Investors
dumped stocks earlier this year
when they feared the chances
of a trade war with China were
Washington’s threats
to impose tariffs
already have been
rattling Wall Street.
escalating, only to buy back in
when those worries subsided.
Since the steel and aluminum tariffs were unveiled in
early March, the S&P 500 has
fallen 2.2%; it has had moves of
1% or more on 17 of 43 trading
days through Tuesday. Some
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would be free to begin work on
a second set of tariffs, threatened last month, on an additional $100 billion in Chinese
imports to the U.S.
Also in the weeks ahead are
a public hearing on May 15 over
the proposed tariffs on Chinese
goods, and a Treasury Department deadline of May 21 for
proposals for new restrictions
on Chinese investments in critical industries and technologies.
Mr. Trump weighed in on the
developments on Tuesday, comparing his administration’s
trade policies with its efforts to
negotiate nuclear disarmament
with North Korea. “Delegation
heading to China to begin talks
on the Massive Trade Deficit
that has been created with our
Country,” he said in a tweet.
“Very much like North Korea, this should have been fixed
years ago, not now,” Mr. Trump
said. “Same with other countries and NAFTA...but it will all
get done.”
Thus, the month of May
U.S.-traded hot rolled
coil steel futures
30%
100%
Companies including Harley-Davidson, above, have said that tariffs are driving up commodity prices.
Change in steel prices
this year for U.S. versus
international markets
The Medicaid debate is
spilling into the governor’s
race. In April, when Maine Attorney General Janet Mills, a
Democratic gubernatorial candidate, said tobacco-settlement cash could fund the
Medicaid expansion through
fiscal year 2019, Mr. LePage
called it “a political stunt.”
Ms. Mills accuses Mr. LePage of “looking for ways to
overrule the people of Maine.”
Mary Mayhew, a GOP gubernatorial candidate and former health commissioner, opposes the implementation of
the expansion and would try
to repeal the law, her spokesman said.
The politically divided legislature is stalled on a plan
that will please both Mr. LePage and his GOP allies in the
Democratic-led House. Time is
short with the session ending
as soon as Wednesday.
Feb.
March
Jan. ’18 Feb.
Sources: Deutsche Bank; Census Bureau; Bureau of Labor
Statistics; Haver Analytics (job creation); FactSet (prices)
March April
THE WALL STREET JOURNAL.
major stock indexes were down
again on Tuesday after the delay announcement, with tariffsensitive industrial stocks continuing to underperform.
“At the end of the day, the
market absolutely hates uncertainty,” said Dave Lutz, head of
exchange-traded fund trading at
JonesTrading in Annapolis, Md.
“It can handle bad news but it
cannot handle uncertainty.”
The brinkmanship on trade
comes as the U.S. economy has
showed renewed signs of life in
recent weeks, with the dollar
rallying and yields on the 10year Treasury note crossing
above 3% for the first time
since 2014. Growth in the first
quarter, although slower compared with last year, exceeded
analysts’ expectations.
Now, some worry the ambiguity surrounding trade talks is
leading some companies to delay hiring or spending plans until they have a clearer sense of
what the administration will do.
“We’re somewhat worried
about what this type of uncertainty means for the economy
going forward,” said Torsten
Slok, an economist at Deutsche
Bank.
Trade concerns may be a
factor slowing job growth in the
U.S. regions most affected by
the tariffs. The U.S. labor market has been adding a smaller
share of jobs in states with high
production of steel, aluminum,
airplanes, cars and soybeans,
according to Deutsche Bank.
In March, a weak month for
job growth, about three-fifths
of new jobs came from those
states, versus nearly threequarters in the final three
months of 2017, a sign that a recent slowdown in job creation
links back to trade-sensitive industries.
Inflation has remained low
for much of the post-financialcrisis period, a key reason the
Fed has been slow to lift rates.
But tariffs could change the
equation by pushing up prices.
Heating, ventilation, and cooling company Lennox International Inc. said at the start of
the year it expected a $40 million impact on pretax earnings
from rising commodity prices.
After the tariff announcement,
the company lifted that projection to $50 million.
Steve Harrison, Lennox vice
president of investor relations,
said the company is passing the
costs on to customers. It raised
prices 4% to 6% at the beginning of the year, then on Friday
announced another increase of
5% to 8%.
Companies including HarleyDavidson Inc. and Polaris Industries Inc. have said in recent
earnings calls that tariffs are
driving up commodity prices
that had already been climbing.
“We expect steel and other
commodity costs to be a headwind all year,” said Bradley
Halverson, chief financial officer at Caterpillar Inc., on an
earnings call.
—Josh Zumbrun
contributed to this article.
U.S., EU Trade Barbs
Over Steel Tariffs
What products are in the
firing line?
The EU would target
goods including Harley-Davidson motorcycles, Levi’s jeans,
orange juice, peanut butter
and bourbon whiskey. Brussels seeks to exert pressure
on U.S. Congress by targeting
its Republican leadership:
Roughly 95% of all bourbon
comes from Kentucky, home
of Senate Majority Leader
Mitch McConnell, and House
Speaker Paul Ryan is from
Wisconsin, home to HarleyDavidson. Mr. Trump has
threatened to tax European
cars if the EU retaliates
against his metals tariffs.
How could the EU-U.S.
standoff end?
Washington is asking for
the EU to adopt quotas in exchange for permanent waivers.
Brussels is demanding an unconditional and indefinite exemption from U.S. steel and
aluminum tariffs. The EU has
expressed openness to a trade
deal to address U.S. grievances
if it wins an exemption.
—Emre Peker
Why is the U.S. threatening
tariffs against European allies?
The White House says having vibrant steel and aluminum
industries is a national security
concern, and it needs tariffs because these industries are struggling, like their European counterparts, due to a global glut
driven by Chinese overcapacity.
President Donald Trump also accuses the EU of hurting the U.S.,
citing the bloc’s higher tariffs on
cars, and has demanded measures to erase America’s trade
deficit with the bloc.
What is the EU reaction?
Brussels says Mr. Trump’s
move amounts to illegal protectionism under World Trade
Organization rules. Europeans
also are aghast that Washington would consider their exports a national security concern, when 22 of the EU’s 28
members are also U.S. allies in
the North Atlantic Treaty Organization.
Martha Karolyi
and her
husband say
they were
unaware of
any abuse at
their ranch.
and child-pornography counts.
The Karolyis are named defendants in multiple lawsuits
brought by national team gymnasts who say the pair created
a toxic training environment
over the 15 years Martha Karolyi served as the national team
coordinator. The gymnasts say
the Karolyis knew, or should
have known, about Nassar’s
treatment of them while on
the Huntsville, Texas, ranch
the husband and wife owned.
The Karolyis have said they
were unaware of any abuse at
the ranch.
Ms. Karolyi retired in 2016
after the Rio Olympics. During
her tenure as national team
coordinator, she had used the
ranch—where she also lived—
to build a world-dominant
women’s gymnastics program.
National team gymnasts attended monthly training camps
there, which were the basis for
selection for major competitions. It was also where USA
Gymnastics officials fine-tuned
their training and routines, and
where Nassar treated injuries.
The Karolyis’ suit, filed in a
Walker County Court in Texas,
maintains that they are owed
indemnification “for fees and
costs incurred in lawsuits and
related civil and criminal investigations” because USA
Gymnastics employed Nassar,
oversaw American gymnastics,
and had leased the ranch for
the national training camps.
The suit also says the Karolyis don’t owe indemnification
to the U.S. Olympic Committee
for anything that Nassar did on
their property as team physician, and that USA Gymnastics
broke a contract to buy the
ranch from the Karolyis.
ZUMA PRESS
BY JENNIFER LEVITZ
ROBERT F. BUKATY/ASSOCIATED PRESS
Governor Fights Obamacare to the End
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THE WALL STREET JOURNAL.
NY
Wednesday, May 2, 2018 | A7
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A8 | Wednesday, May 2, 2018
THE WALL STREET JOURNAL.
* *
WORLD NEWS
Iran Treads Warily With Deal in Balance
As pressure rises over
future of nuclear pact,
Tehran courts Europe,
stops short of threats
LUDOVIC MARIN/AGENCE FRANCE-PRESSE/GETTY IMAGES
Iran is trying to keep Europe on its side as questions
mount about the future of its
nuclear deal with Western
powers and suspected Israeli
airstrikes on its bases in Syria.
By Sune Engel
Rasmussen in Beirut
and Asa Fitch in Dubai
Short of military options
and economically distressed at
home, Iran appears to be calibrating its response to escalating diplomatic and military
pressure from the U.S. and its
allies Israel and Saudi Arabia.
Tehran’s goal is to blunt the
Trump administration’s ability
to reimpose sanctions, retain
its influence in Syria and avoid
a wider regional war, some
analysts said.
President Donald Trump
has set a May 12 deadline to
decide whether to scrap the
deal, which lifted most sanctions on Iran in exchange for
curbs on its nuclear program.
Mr. Trump, Israel and, increasingly, European leaders have
expressed alarm about Iran’s
ballistic-missile program and
its influence in conflicts in
Syria and Yemen, which aren’t
Iran President Hassan Rouhani, right, told French President Emmanuel Macron the deal is nonnegotiable.
covered by the deal.
In the event the U.S. moves
to reimpose financial restrictions on Iran, Tehran is working “to divide the EU and U.S.
in order to ensure the U.S.
sanctions are ineffective,” said
Stratfor, the U.S. geopolitical
security firm.
Iranian President Hassan
Rouhani spent an hour on the
phone with French President
Emmanuel Macron on Sunday,
calling the nuclear deal nonne-
gotiable, Iranian state media
reported. He added that Iran
was “ready for dialogue” on
regional stability.
Following Israeli Prime
Minister Benjamin Netanyahu’s presentation on Monday of what he said was new
evidence about Tehran’s nuclear program, Iranian officials
issued taunts but stopped
short of making provocative
threats that could alienate Europe, where support for the
SECURE
Thinning Ranks
Efforts to build self-sufficient Afghan security forces faced a setback
in the past year as personnel numbers dropped by about 10%,
complicating efforts to protect the population.
Afghan security personnel
Civilian casualties
350 thousand
12 thousand
300
GHULAMULLAH HABIBI/EPA/SHUTTERSTOCK
Continued from Page One
also controlled or influenced a
greater percentage of the
country’s districts.
The latest quarterly report—released as memorial
observances were held across
the Afghan capital for the 25
people killed in Monday’s twin
suicide
bombings—comes
amid a stepped-up U.S. air
war in Afghanistan aimed at
forcing the Taliban to the negotiating table and destroying
the local affiliate of Islamic
State.
“Building up the Afghan security forces is a key priority
for the U.S. and our allies, so
it’s concerning to see a drop in
force strength,” said Mr.
Sopko.
With air and intelligence
assets shifted from the waning
campaign against Islamic State
in Iraq and Syria, the fight in
Afghanistan has become the
U.S. military’s main effort in
the region, American military
officials say.
The U.S. has spent more
than $78 billion trying to
build up the country’s army
and police forces from nearly
scratch since the Americanled invasion of Afghanistan
in 2001 that forced the Tali-
nuclear accord remains high.
That contrasts with more
forceful past responses from
Iran. After U.S. lawmakers voted
in 2016 to extend presidential
authority to impose sanctions
on Iran, the country ordered
scientists to develop a nuclear
propulsion system for ships.
New U.S. sanctions targeting
Iran’s ballistic-missile program
in recent years were met with
Iranian sanctions on American
companies and individuals.
Iran’s regional nonstate allies like the Lebanese Hezbollah militia have remained
quiet, even after a suspected
Israeli attack Monday morning
on a base in Syria housing Iranian elite forces. Israel declined to comment.
Iran issued its first response to the attack on Tuesday afternoon with comments
in Damascus by Alaeddin
Boroujerdi, the chairman of
the Iranian parliament’s national security committee.
“Aggression of the Zionist
entity against the presence of
our military advisers in Syria
gives us the right to respond at
the appropriate place and
time,” the Associated Press reported Mr. Boroujerdi as saying.
It was the second time in a
month that suspected Israeli
missiles allegedly killed Iranian troops in Syria. Israel has
said it won’t tolerate an Iranian military presence near its
border with Syria.
“Iran’s response thus far
has been sharp rhetoric,” said
Behnam Ben Taleblu, a research fellow focusing on Iran
at the Washington-based
Foundation for Defense of Democracies. “Conversely, Iran’s
regional activities remain in a
holding pattern.”
Mr. Netanyahu’s speech appeared designed to impeach
Iran’s credibility. The Israeli
leader said Israeli intelligence
agents had uncovered a trove
10
250
National
Police
200
Injuries
8
6
150
National
Army
100
4
2
50
Deaths
0
0
’14 ’15 ’16 ’17 ’18
’09
’11
’13
’15
’17
Afghan police guarding a checkpoint in Jalalabad on Tuesday.
Sources: Special Inspector General for Afghanistan Reconstruction (security forces);
United Nations (casualties)
ban from power.
The American military has
pointed to progress in an attempt to show that investment
has been worthwhile in helping prevent the country from
becoming a staging ground for
terrorist attacks. But Tuesday’s report shows that headway in establishing a viable
army and police force capable
of securing the country
against insurgents has become
far from steady.
The number of army and
police
personnel
totaled
296,409 as of Jan. 31, down
“We have no shortages in
recruitment. People are joining
the army every day,” Mr. Radmanish said, adding that the
army is carrying out more operations against Islamist militant groups than last year and
is more effective than ever.
Mr. Radmanish also disputed the portrait of an Afghan military on its heels.
“We’ve expanded our geographical control and the only
districts that remain with the
Taliban are those they took
many years ago. Other districts that have been invaded
35,999 from a year earlier.
Also, the Taliban and other Islamist militant groups controlled 14.5% of Afghanistan’s
407 districts, it said—the
highest level since late 2015,
when the auditing agency
started recording such data.
In response to the report’s
findings, Mohammad Radmanish, spokesman for the Afghan
Defense Ministry, denied that
the Kabul government was
facing difficulties with recruitment or that casualties and
desertions were thinning the
ranks of the army.
THE WALL STREET JOURNAL.
EXTRA
COMFORT
IN EVERY
STEP
by the Taliban last year or this
year were swiftly retaken by
our army and commandos,” he
said.
In February, Afghan President Ashraf Ghani offered
peace terms to the Taliban, including recognizing it as a legitimate political group within
the current system, if it
stopped fighting and abided
by the country’s constitution.
The Taliban haven’t responded
to the offer.
The inspector general’s report offered no explanation
for the shrinking ranks of the
of Iranian plans for a nuclearweapons program, proving that
Tehran had lied to the world
about its atomic ambitions.
Much of Europe remained
unconvinced. France and Britain on Tuesday said the Israeli
evidence actually reinforced
the need for the pact, which
prohibited any activity linked
to nuclear-weapons development and outlined international inspections.
The International Atomic
Energy Agency reiterated that
its 2015 report on the history
of Iran’s nuclear program
found “no credible indications”
that Iran was developing nuclear weapons after 2009.
Iran’s muted reaction reflects the uneasy status quo in
the Middle East. Tehran has
expanded its influence across
the region without sparking a
wider regional war, though Israel and Saudi Arabia have
stepped up military action. Mr.
Trump’s plan to redo the nuclear deal has threatened to
upend this balance of power.
For now, the Iranian consensus appears to be for restraint, but Supreme Leader
Ayatollah Ali Khamenei has the
power to overrule moderate
voices such as Mr. Rouhani and
Foreign Minister Javad Zarif.
“Iran can’t be seen as allowing Israel to kill its citizens
and get away with it,” said
Mohammad Marandi, a professor at the University of Tehran.
Afghan security forces.
In a move toward keeping
more data related to the Afghan war secret—a trend that
began in the last two years of
the Obama administration and
has expanded under President
Donald Trump—the U.S. military has withheld from Mr.
Sopko’s agency the exact casualty figures and desertion rates
for the Afghan security forces
and has redacted detailed assessments of their performance and data concerning the
state of their equipment.
It has done so at the request of the Afghan government, it says, noting that the
numbers and other sensitive
data related to the Afghan war
effort are available to members of the U.S. Congress in a
classified annex of the report.
At the time the decision
was made to withhold the casualty figures, members of the
Afghan security forces were
being killed in battle at a rate
of nearly 20 men a day, according to the auditing agency.
The U.S. has invested more
than $126 billion in various
types of reconstruction and
relief aid to Afghanistan since
2002, nearly 62% of it—or
$78.2 billion—for training and
otherwise supporting the
country’s security forces.
—Habib Khan Totakhil
contributed to this article.
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.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | A9
NY
WORLD NEWS
BY JAMES HOOKWAY
DENGKIL, Malaysia—The
campaign to lead Malaysia is
turning testy as the May 9
election approaches, suggesting the vote will do little to
bridge the divisions characterizing this prosperous, Muslimmajority nation.
The newly minted opposition leader, 92-year-old former
Premier Mahathir Mohamad,
on Tuesday accused the government of systematically sabotaging his alliance.
“Their goal is to win, but
not in a clean fight, in a dirty
fight,” Dr. Mahathir said at a
campaign stop in Dengkil, a
town south of Kuala Lumpur.
As an example of alleged
government interference, Dr.
Mahathir accused government
supporters of tampering with
a plane he had chartered to
take him to a rally last weekend. He ended up using a
plane provided by a friend.
The Civil Aviation Authority
Malaysia denied that the plane
had been sabotaged and said it
couldn’t take off because air
had leaked from one of the
front tires.
Responding to the accusation, Deputy Prime Minister
Ahmad Zahid Hamidi said Dr.
Mahathir has lost little flair
for the drama that characterized his years in power. He
suggested Dr. Mahathir would
admit himself to a hospital on
election day to win sympathy
votes. “I hope that voters will
not fall victim to this,” Mr. Ahmad Zahid said.
The claims and rebuttals reflect the tensions of the fiveweek campaign, which was
preceded by last-minute redistricting that the opposition
said could enable the ruling
National Front coalition to eke
out a majority in Parliament
even if it finishes far behind in
the vote. The National Front
has led every government
since independence in 1957.
The
government
also
pushed through a law in April
making the publication of fake
FAZRY ISMAIL/EPA/SHUTTERSTOCK
Malaysia Rulers
Fighting ‘Dirty,’
Mahathir Says
Former Prime Minister Mahathir Mohamad, shown on a campaign stop, accused the government of sabotaging his opposition alliance.
news punishable by up to six
years in prison, which critics
say could inhibit debate. The
government rejects that either
move was intended to tip the
elections.
The campaign is raising
questions about the strength
of democracy in a country that
has taken a more authoritarian
turn and, like neighbors in
Southeast Asia, has been
building closer ties to China,
said James Chin, head of the
Asia Institute at the University
of Tasmania in Australia.
Political fractures have
deepened in the resource-rich
nation, with the government
doubling down on its core support among the majority ethnic-Malay Muslim population
that dominates rural areas
while the opposition courts a
wealthier, more multiracial
following in the cities.
Dr. Mahathir is attempting
to defeat his former protégé,
Prime Minister Najib Razak,
whom he accuses of skimming
money from a scandal-dogged
state
investment
fund,
1Malaysia Development Bhd.,
or 1MDB.
1MDB and Mr. Najib have
denied wrongdoing and said
they would cooperate with any
lawful international investigation. Multiple Malaysian investigations in Malaysia into
1MDB closed without finding
wrongdoing.
During his authoritarian
rule from 1981 to 2003, Dr.
Mahathir centralized power
and blocked his rivals. When
his deputy, Anwar Ibrahim,
challenged him for power, Dr.
Mahathir had him arrested for
sodomy, charges he denied.
As opposition torchbearer,
Dr. Mahathir has pledged to
hand power to Mr. Anwar, who
is currently in prison on another disputed sodomy conviction.
BY EVA DOU
BEIJING—China established
formal relations with the Dominican Republic, peeling
away another of Taiwan’s
dwindling diplomatic partners
as Beijing tries to press Taipei
to accept Chinese terms for
political engagement.
Beijing’s move cuts the
number of governments recognizing Taipei to 19 and is part
of a tactic dating to China’s
and Taiwan’s split seven decades ago in a civil war.
Chinese Foreign Minister
Wang Yi and his Dominican
Republic counterpart, Miguel
Vargas, sealed the diplomatic
Beijing draws in the
Dominican Republic,
sapping diplomatic
support for Taipei.
ties in Beijing on Tuesday,
China’s Foreign Ministry said.
The Dominican Republic’s
presidential office said in a
statement its business community has long wanted a formal relationship with the
world’s second-largest economy and the move would benefit the country’s future.
Taiwan’s Foreign Ministry
responded angrily, condemning “Beijing’s outrageous diplomatic practices.” It said
China uses promises of development aid to lure countries
into establishing ties, potentially creating a “debt trap” in
which “gains by no means
make up for the losses.”
Beijing stopped wooing Taiwan’s diplomatic partners for
several years as political relations between the governments warmed. It resumed its
efforts after the election of
Taiwanese President Tsai Ingwen in 2016. Unlike her predecessor, Ms. Tsai refused to acknowledge a principle that
WORLD WATCH
China and self-ruled Taiwan
are part of “One China.” Beijing sees the phrase as an acknowledgment that political
unification is possible.
Beijing, which has said it
would absorb Taiwan by force
if necessary, has sought to
pressure Ms. Tsai by boosting
military drills in nearby waters and airspace, withholding
economic cooperation and
poaching Taiwan’s diplomatic
allies.
The Dominican Republic is
the third country to have broken ties with Taiwan since Ms.
Tsai’s election, after Panama
in 2017 and São Tomé and
Príncipe in 2016.
HOW HWEE YOUNG/EPA/SHUTTERSTOCK
China Dilutes Recognition for Taiwan
Ministers Vargas and Wang sealed the ties in Beijing on Tuesday.
OPENS TOMORROW
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SÃO PAULO DISASTER: A 24-story building sheltering dozens of squatting families caught fire and
collapsed in Brazil’s biggest city on Tuesday. At least one person died.
NORTH KOREA
Trump: Summit Site
To Be Revealed Soon
President Donald Trump said
his administration would likely
announce “in the next couple of
days” a location and date for a
summit with North Korean
leader Kim Jong Un.
Mr. Trump made the remark
in response to a question from a
reporter in the Oval Office. A
day earlier he had said he was
considering Singapore, as well as
the demilitarized zone between
North and South Korea, as
venue options.
The president also said the
suggestion from South Korea’s
Moon Jae-in that Mr. Trump
merited the Nobel Peace Prize
for his efforts on the Korean
Peninsula was “very nice” but
that “the main thing is to get it
done” and that his goal was
peace.
—Louise Radnofsky
NIGERIA
Worshipers Killed in
Two Blasts in Mubi
Two explosions killed at least
24 worshipers at a mosque in
northeastern Nigeria and
wounded at least 56 others,
with many of the victims caught
in the second blast while trying
to flee, police said Tuesday.
The attack in Mubi town
came a day after President Muhammadu Buhari met with Pres-
ident Donald Trump at the
White House and discussed the
threat from the Nigeria-based
Boko Haram extremist group. Its
fighters were quickly blamed for
Tuesday’s blasts.
This is the second time in six
months that dozens have been
killed in an attack on a Mubi
mosque. In November, a teenage
suicide bomber attacked worshipers as they gathered for
morning prayers, killing at least
50 people in one of the region’s
deadliest assaults in years.
The National Emergency
Management Agency coordinator
in Adamawa state, Imam Abbani
Garki, said 18 people were critically wounded and had been
evacuated for treatment in Yola
city.
Haruna Hamman Furo, the
head of the state emergency
management agency, called the
attack “devastating.”
—Associated Press
UNITED KINGDOM
Britons Cut Back
On New Borrowing
New lending to households
fell to £4.3 billion ($5.9 billion) in
March from £5.5 billion in February, the Bank of England reported.
Separately, data firm IHS
Markit’s purchasing managers index for the manufacturing sector fell to 53.9 in April from 54.9
in March.
The purchasing managers
survey found that confidence
among respondents fell to its
lowest level in five months,
partly reflecting uncertainty
about the way in which the U.K.
will leave the European Union in
March 2019.
—Paul Hannon
CANADA
Economic Growth
Beats Expectations
The country’s economy grew
at a faster pace than expected
in February, fueled by a strong
rebound in oil and gas extraction
and widespread gains that reinforced expectations the Bank of
Canada will raise interest rates
again this year.
Canada’s gross domestic
product, or the broadest measure of goods and services produced in an economy, increased
0.4% in February from the previous month to a seasonally adjusted 1.77 trillion Canadian dollars (US$1.38 trillion), Statistics
Canada said Tuesday. Market expectations were for a 0.3% advance, according to economists
at Royal Bank of Canada, after
the economy contracted 0.1% in
the previous month.
Year-to-year, the economy advanced 3% in February.
February’s advance “reinforces
the theme that the economy is
in decent shape and can continue to move slowly but surely
higher,” said BMO Capital Markets economist Benjamin Reitzes.
—Kim Mackrael
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THE WALL STREET JOURNAL.
A10 | Wednesday, May 2, 2018
Taken to court
Beyond the internal debates
are lawsuits, including from
female employees alleging pay
discrimination against women;
from male ex-employees
claiming bias against conservative white men; and from a
transgender engineer who said
he was fired for making derogatory statements about what
he called white male privilege.
All this comes on top of a very
public controversy last August
when Google fired a software
engineer, James Damore, who
wrote an internal memo saying gender differences might
have something to do with
women’s under-representation
in the tech workforce.
Politicians, media and consumer groups are raising
questions about how giant
tech platforms such as Google,
Facebook Inc. and Twitter Inc.
make difficult decisions on issues of free speech that potentially affect billions of users.
Google, a crucial part of the
internet’s behind-the-scenes
police force, is struggling simultaneously to curate a cacophony of voices within its
own abode and to define what
is allowed in search and on
YouTube. Google engineers are
trying to refine the algorithms
that block content for being
extremist or dangerous.
A Google spokeswoman said
the quashing of Ms. Newkirk’s
talk is seen internally as a failure to properly vet speakers.
Google has formed a group of
employees whose job is to review speakers in advance.
Google also has published new
guidelines for acceptable content in Talks at Google.
Many companies have
struggled to strike a balance
between employees’ right to
share opinions and maintaining a cordial workplace. The
SHARE
Continued from Page One
give me more money and hook
me up with more deals.”
When James Rhee took the
helm of Ashley Stewart, a plussize clothing chain, he gathered the company’s workers
together at its headquarters in
Secaucus, N.J., and told them
he was “the least qualified person to run the company.”
The confession shocked
some employees and scared
others, Mr. Rhee said. The
feedback at the time: “This is
the person who’s supposed to
be saving us when the company’s hair’s on fire?”
Mr. Rhee’s job history included founding his own investment firm and helping
manage the Meow Mix brand
of cat chow, but the sum total
of his retail operating experience amounted to busing tables at restaurants while in
high school and college. He appealed to Ashley Stewart workers to help him learn the business, which, at that point in
2013, was teetering on the
brink of bankruptcy.
He admitted another per-
A talk by one worker
embraced the identity
of a ‘yellow-scaled
wingless dragonkin.’
said the company hadn’t done
enough to stand up for gender
equality.
Debates
inside
Google have flared up on email
lists and Memegen ever since.
“They think they can please
everybody, and I don’t think
that’s possible,” said Tim Chevalier, the transgender former
engineer, who alleges he was
fired because of his statements against discrimination.
Mr. Chevalier said in his February suit he was harassed
A Google talk by PETA’s Ingrid Newkirk, seen after her protest of a pigeon shoot, was canceled when some employees objected to
her theme of racism and animals; Google fired James Damore, below, for suggesting gender could affect one’s facility for tech work.
and bullied on the internal
message boards, with little
company intervention. The
Google spokeswoman said, “An
important part of our culture
is lively debate. But like any
workplace, that doesn’t mean
anything goes.”
A shooting early last month
at the headquarters of
Google’s YouTube unit, in
which a woman with a pistol
wounded three before taking
her own life, led one Googler
to propose the company let
staff members with gun permits carry weapons to the office, according to an employee
who saw the post. Google reaffirmed its no-gun policy.
While Google’s intranet forums usually are overseen by
employee volunteers, the company says its human-resources
staffers can investigate complaints by reviewing message
boards and in some cases punish employees based on posts
found there. The memo that
got Mr. Damore fired breached
the code of conduct “by advancing harmful gender stereotypes in our workplace,”
Google CEO Sundar Pichai said
in a letter to employees about
the incident.
Google executives are preparing to issue a new set of
guidelines around what can
and can’t be said on internal
forums, people familiar with
the matter said.
Each year, Google invites
hundreds of actors, authors
and other luminaries to give
talks. While a small team ap-
reer,” he said. Google had no
comment on that.
No dice
proves speakers, suggestions
come from staffers throughout
the company, who then typically organize the talks.
Engineer Dan Hackney was
expecting a fight when he proposed a talk by Alex Epstein,
an author who has criticized
the renewable-energy movement. The visit stirred debate
on campus but ultimately
went off without a hitch in August. “To me, that signaled the
company was willing to bring
people with controversial
ideas,” Mr. Hackney said.
Later, however, after Google
fired Mr. Damore for his memo
questioning women’s fitness
for certain jobs, Mr. Hackney
left Google. “I was worried
about my ability to express
controversial ideas without it
negatively impacting my ca-
PETA’s Ms. Newkirk was
slated to give her talk on Jan.
18. A software engineer, Lucas
Freitas, had set her visit in
motion months earlier, writing
to PETA that “people in our
Googlers For Animals group
discussed and are very excited
about having Ingrid come!”
Ms. Newkirk, 68, is a lightning-rod figure as head of an
organization known for radical
activism. In one of her bestknown protests, she ran across
a field in Pennsylvania with
other PETA members to stop
the sport shooting of hundreds of pigeons, a move that
landed her in jail for 15 days.
The pigeons survived.
Ms. Newkirk spoke at
Google six years ago. This
time, she planned to build on
PETA’s view that animals are
no different from people and
should have the same rights,
she said in an interview. The
talk’s title: “How The National
Conversation on Racism Affects PETA’s Fight for Animal
Rights.”
She planned to show a
video in which RZA, the WuTang Clan hip-hop artist and
outspoken vegan, transforms
from a black man into an
Asian woman and eventually
into a bear and a chicken. “It
doesn’t matter if we have fur
or feathers or fins, the length
of our nose or the number of
Google’s Soapbox
The internet giant hosts hundreds of speakers at its offices each year, including many prominent political thinkers.
PHOTOS: DPA/ZUMA PRESS; GETTY IMAGES(3)
Continued from Page One
loud debates and doctrinaire
stances are commonplace—
and today its parent, Alphabet
Inc., is increasingly struggling
to keep things under control.
“Activists at Google” helped
organize a rally critical of
President Donald Trump’s policies. “Militia at Google” members discussed their desire to
overturn a prohibition on guns
in the office. “Conservatives at
Google” allege discrimination
against right-leaning job candidates. “Sex Positive at
Google” group members are
concerned that explicit content is being unfairly removed
from Google Drive file-sharing
software.
“Googlers For Animals” invited the PETA president, only
to be undercut by members of
the “Black Googler Network.”
Google’s broad corporate
culture has long leaned Democratic, and that’s reflected in
the internal debates that often
pit left-wing causes against
each other. Google employees
gave 62 times as much to Hillary Clinton’s 2016 presidential campaign as that of nowPresident Donald Trump, and
former Alphabet Executive
Chairman Eric Schmidt helped
the Clinton campaign with
data analysis. Less numerous,
but increasingly voluble, are
groups of conservative employees reacting against what
they see as Google’s political
orthodoxy.
Noam Chomsky, 2017
Cambridge, Mass.
The bestselling author and MIT
linguistics professor recounted
his career in political activism
and delved into the challenges
now facing the media industry.
Condoleezza Rice, 2010
Mountain View, Calif.
The former secretary of state
told stories from her childhood
in segregated Birmingham, Ala.,
and from her time serving in
George W. Bush’s cabinet.
Henry Kissinger, 2008
Mountain View, Calif.
The Nobel Prize winner and
secretary of state under Richard Nixon described how he negotiated the 1973 cease-fire
that ended the Vietnam War.
Barack Obama, 2007
Mountain View, Calif.
Then a senator running for
president, Mr. Obama gave a
stump speech before being interviewed by Google’s thenchief executive, Eric Schmidt.
sonal fear: loneliness. Mr.
Rhee’s family would remain in
Massachusetts
while
he
worked four to five days a
week in another state.
Aretha Blake, a buyer at
Ashley Stewart, said Mr. Rhee’s
openness motivated her to
step up and learn something
new. She worked more with
the marketing department and
started to pilot new projects,
including a prom dress line.
The formal wear idea flopped,
but a subsequent push into
plus-size clothes for younger
shoppers has been a hit. In addition to new markets, Ashley
Stewart has built out its ecommerce business and is now
profitable.
“He let us have a voice,” Ms.
Blake said. “It makes me want
to think of more ideas.”
When leaders recount emotional dreams or admit they
don’t know what they’re doing,
it can breed loyalty and engender collaboration, some CEOs
say.
But not everyone wants to
work for an oversharer. And in
an era of heightened sensitivity and concerns about workplace behavior, some bosses
may be inclined to share less.
For decades, CEOs across
industries were supposed to
have all of the answers and
avoid any sign of weakness,
said Sydney Finkelstein, a
management professor at Dartmouth College’s Tuck School of
Business who studies chief executives.
“Power was a virtue in and
of itself,” he said.
Many executives still take
their leadership cues from the
past. “Most CEOs, if they had
their druthers, they wouldn’t
want to give up power,” Mr.
Finkelstein said. But even in
the highest ranks of the most
traditional companies, new realities such as activist investors have forced leaders to be
more accommodating.
Brené Brown, the University
of Houston professor whose
Ted Talk on the power of vulnerability became a viral hit,
with 34 million views, said
leaders need a “clear intention
why” before they reveal intimate information.
In books and speeches, Ms.
Brown promotes risking emotional exposure as a way to
find meaning in life and build
relationships. She also wonders whether vulnerability has
become a buzzword that has
prompted people to be open in
ways that could be misguided.
“This is dangerous, when
things become misunderstood,” she said. “For leaders,
sharing without the intention
of developing other people or
processes is not courageous.”
Rachel Proffitt, an attorney,
was so impressed with the
CEO of Cooley LLP, of Palo
Alto, Calif., that she switched
law firms to work for him. She
said an exchange about parenting with Joe Conroy, the CEO,
was “one of the most open and
honest conversations” she had
ever had.
“This is a guy who’s going
to sit here and talk to me as a
person,” she recalled thinking
after her initial dinner with
him.
A few months later, Ms.
Proffitt was moved to tears at
a meeting of the firm’s partners when Mr. Conroy recounted a dream involving his
oldest son. Mr. Conroy says his
annual speech, which has
touched on topics like the
death of his father, is designed
to stir workers to feel connected to each other and the
firm. His speech this year was
about living in the moment.
Mr. Conroy describes his
management style as “human
being.”
“It’s all part of not being
larger than life,” he said. “In
order for people to follow you,
they have to trust you. In order for them to trust you, they
have to know you.”
Rand Fishkin blogged about
his insomnia, depression and
other soul-baring topics while
working at Moz, a Seattlebased marketing software
company. The former Moz CEO
says his openness sometimes
produced a jump in customers
CHRISTIE HEMM KLOK FOR THE WALL FOR THE WALL STREET JOURNAL
GOOGLE
dilemma is especially striking
at tech companies, which typically cast themselves as open
meritocracies. Googlers, as
employees are called, are encouraged to “bring their whole
selves to work.”
“Google has created a level
of entitlement which is hard to
claw back,” said Jim Miller, a
former vice president who left
Google earlier this year to run
a startup. “People feel that it’s
OK to debate everything.”
In 2008, a Google chef generated an online debate, with
more than 100 comments on
Google’s internal message forums, by serving a “Free Tibet
Goji Chocolate Cream Pie” in
the cafeteria, a reference to
the political movement opposing China’s rule of the
Asian region. The chef initially drew a suspension,
which another manager overturned
on
free-speech
grounds, according to Laszlo
Bock, who wrote about it in
the book “Work Rules!”
Employees can choose from
thousands of email discussion
groups, on topics including
juggling and polygamy. And on
a tool called Memegen, pop
culture images are overlaid
with sardonic commentary, often poking fun at recent controversies.
At a recent Google event titled “Living as a Plural Being,”
one employee gave a talk explaining why the speaker sexually identified as “a yellowscaled wingless dragonkin”
and an “expansive ornate
building,” according to a suit
from Mr. Damore, the fired
software engineer.
Mr. Damore’s memo and resulting dismissal last summer,
besides stirring criticism outside the company, ignited
frenzied debate inside it. Some
employees accused Google of
wrongly firing an employee
for expressing himself; others
FROM TOP: PETA; MICHAEL LIEDTKE/ASSOCIATED PRESS
IN DEPTH
Jessica Mah shares stories
with employees and investors.
legs,” RZA says in the video’s
voice-over. “We’re not different in any important way.”
A pamphlet Ms. Newkirk
planned to distribute to those
attending shows pictures of a
cow, a chicken and a bunny
with the heading “How Bigotry
Begins.” The talk was canceled
about an hour before it was to
begin, with goodie bags ready
and the auditorium already
starting to fill.
Ms. Newkirk, still in the
parking lot, insisted she be allowed to come in and speak
with someone about the situation. Mr. Freitas, the employee
who invited Ms. Newkirk, was
with her, and eventually received a call from a Google
employee. The call, which Mr.
Freitas put on speakerphone,
was captured by Ms. Newkirk’s
audio assistant, she said.
‘A sort of outcry’
“There was, like, a sort of
outcry in response” to the
prospect of the talk, said the
Google employee, David Barry,
according to a transcript reviewed by the Journal. “And
the last thing that Google
wants, that we want to do, is
to make people, like, feel
alienated, or hurt people, like,
who voiced concern over this
talk,” said Mr. Barry, whose
LinkedIn profile describes him
as an associate account strategist at Google.
Mr. Barry didn’t respond to
a request for comment.
The move blindsided Mr.
Freitas. He texted a PETA official saying “Google’s really
high ups” had made the decision and “this sucks,” according to a copy of the text messages provided by PETA. Mr.
Freitas didn’t respond to a request for comment.
Ms. Newkirk repeatedly
emailed Google executives but
wasn’t given more of an explanation of what happened. She
said she is still perplexed
about the incident. “It’s the
most anti-racist talk you’ll
ever hear,” she said.
The Google spokeswoman
said an employee working on
Talks at Google on a volunteer
basis unilaterally made the decision to cancel the talk. She
wouldn’t identify the employee.
but also sparked anxiety
among employees.
Mr. Fishkin shared his own
performance review on the
blog and published an internal
email describing problems
with a major product launch at
the closely held Moz. It initially gave Trevor Klein, a content manager, mild heartburn.
Would outsiders think less of
the company as it shared its
shortcomings?
“My first reaction was sort
of…OK, here we go. Let’s gear
up because we have no idea
how the broader world is going to react,” he said.
His nerves quickly faded,
though, and he feels Mr. Fishkin’s openness built camaraderie.
Mr. Fishkin, who left Moz in
February but is still chairman
of the board, has no regrets.
He said external reaction to his
sharing was generally positive.
“Whatever your dirty skeletons in the closet are, just
open the closet and show everyone,” he said. “If your finger is shaking when you hit the
publish button, and you can
barely look at the responses in
the comments and email and
on Twitter the next morning,
now you’re being transparent.”
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | A10A
NY
* *
GREATER NEW YORK
Electric Boat Wins Incentive Deal
Connecticut expects
submarine maker to
boost jobs, spending in
return for $83 million
Cuomo
Pushes for
Tougher
Gun Law
BY CORINNE RAMEY
Connecticut will give an
$83 million incentive package
to General Dynamics Electric
Boat in exchange for a commitment from the submarine
maker to invest in its Grotonbased plant, the company and
state officials said on Tuesday.
Electric Boat, which manufactures two naval submarines
annually, is gearing up to construct three a year. The company said Tuesday it will make
$852 million in capital investments and plans to spend
more than $500 million annually buying parts from in-state
suppliers.
The submarine maker, a
unit of General Dynamics
Corp., said last year it plans to
hire up to 18,000 workers in
Connecticut by 2030 to meet
its expansion demands and to
replace much of its current
workforce that is approaching
retirement age. It hired nearly
2,000 Connecticut workers in
2017.
This Connecticut investment “provides crucial support for the workforce development and facility expansion
that will help Electric Boat
grow, increase its economic
contribution to the region,”
said Electric Boat President
Jeffrey Geiger.
The defense industry has
been one of the strongest sectors for Connecticut’s struggling job market. The transportation-equipment
New York Gov. Andrew
Cuomo on Tuesday pushed for
lengthening the waiting period
to buy guns for people who
aren’t immediately approved
when their backgrounds are
checked in a federal database.
Under federal law, gun dealers must check a potential
buyer’s name in the National
Instant Criminal Background
Check System before selling a
firearm. The system then provides the seller with a notification of “proceed,” “denied”
or “delayed.”
People can be denied due to
convictions for certain crimes
or for being the subject of a
protective order, among other
reasons. If the check is delayed and isn’t completed
within three business days,
the buyer is, by default, allowed to purchase the gun.
Mr. Cuomo’s bill would extend that waiting period for
delayed purchases in New York
state to 10 days, giving the authorities more time to investigate potential gun buyers.
In February, Sen. Michael Gianaris, a Democrat, introduced
legislation that also lengthened
the waiting period to 10 days.
At a news conference Tuesday in Manhattan, Mr. Cuomo
rattled off a list of locations
where mass shootings had occurred. “How many times do
you have to have the same situation happen over and over and
over again before this nation
comes to its senses and says,
‘Let’s do something to stop innocent people from dying?’ ”
said Mr. Cuomo, a Democrat
who is running for a third term.
Gun-control advocates say
that even though 90% of background checks are completed
immediately, crucial checks
demand more time.
JESSICA HILL/ASSOCIATED PRESS
BY JOSEPH DE AVILA
Electric Boat, which manufactures two naval submarines annually, is gearing up to construct three a year and plans to expand hiring.
manufacturing field, which includes Electric Boat, employs
45,500 people in the state, up
14% since July 2014, according
to the Federal Reserve Bank of
St. Louis. Total job growth for
the state over that same time
frame is only about 2%.
Other defense companies
based in Connecticut—including United Technologies
Corp.’s Pratt & Whitney and
Lockheed Martin Corp.’s Sikorsky—are also planning to hire
thousands of employees in
coming years.
Much of Electric Boat’s em-
ployment growth has been
driven by an increase in demand for Naval submarines. In
addition, the company is expanding its Groton facility to
prepare for the construction
of a new type of nuclear-powered ballistic missile submarines for the U.S. Navy.
At a national level, new orders for defense capital goods
from January through March
jumped by 12% compared with
the same period last year, the
Commerce Department reported Thursday. Meanwhile,
new orders for nondefense
capital goods excluding aircraft—a gauge of business investment—rose 7% during that
same time frame, according to
the agency.
As part of Connecticut's
package, the state is lending
Electric Boat $35 million. But
if the company hits certain
employment and spending
goals, it doesn’t have to pay
the state back. The state also
offered $20 million in salestax exemptions and an $8 million grant for workforce development programs through
community colleges and other
organizations. Connecticut will
pay $20 million for a dredging
project that will allow subs to
launch from a new dry dock in
Groton.
Gov. Dannel Malloy, a Democrat, said the agreement with
Electric Boat is a boon for
Connecticut’s
supply-chain
companies.
“Our state’s partnership
with General Dynamics Electric Boat will ensure that
thousands of good-paying
manufacturing jobs continue
to grow for years to come,”
Mr. Malloy said.
METRO MONEY | By Anne Kadet
Quick:
What’s New
York City’s
top-reviewed
subway station?
Believe it or not, thousands
of riders have rated hundreds
of stations on forums like Yelp
and Google, considering factors like cleanliness and token
booth clerk personality. While
the reviews aren’t verified,
they can indicate a station’s
relative popularity.
Crunching the numbers
from Yelp and Google, and
disregarding the new Second
Avenue line, I was surprised
to find a standout: Manhattan’s 59th Street-Columbus
Circle station at the southwest corner of Central Park.
While most stops average
two or three stars out of
five, Columbus Circle averages four or five.
D
rawing nearly 74,000
passengers a day, the
hub, which services the
1, A, B, C and D lines, is the
city’s eighth-busiest station.
And according to critics, it’s
quite the party. “It’s a great
station,” wrote Tessie V.,
awarding the stop five stars
on Yelp. “There’s usually musicians about and it’s lovely.”
“A great place to make
out!” wrote Tony R. on Foursquare.
In an effort to appreciate
its charms, I recently spent a
half-day exploring the station.
Not bad. The tracks were
nearly litter-free; the gumsmudge-to-tile ratio is relatively low. The announcements
AGATON STROM FOR THE WALL STREET JOURNAL
This Subway Station Racks Up Rave Reviews
A wall of artwork by Sol LeWitt decorates an entrance to the 59th Street-Columbus Circle station.
were clear. I only saw one rat.
Indeed, the first passenger I
asked about the station lit up
like I’d asked her to describe a
favorite grandchild. “The train
is always on time,” said Janice
Winston, a housekeeper from
the Bronx. “It’s always clean.
The maintenance is 100%.”
Was I in the right city?
Chief Stations Officer Rachelle Glazier, who oversees
all 472 train stops for New
York City Transit, says Columbus Circle employs three
cleaners each shift; every area
gets spruced up at least every
eight hours.
The station requires more
manpower than most, she
notes, but doesn’t receive
more attention than others
relative to its size and traffic.
There are other factors, however, that may give Columbus
Circle an edge.
F
or one, the station got a
$125 million renovation
completed in 2011 that
included new artwork, entrances and staircases, elevators, tiling and lighting.
Then there’s the transit police headquarters at the north
end of the station. The place
is crawling with cops, which
may explain why I couldn't
find a single panhandler to interview for this piece.
Performing musicians,
meanwhile, said they like the
station for its high earnings
potential—more than $100 an
hour in one case—and its location near Universal Music
Group, the Juilliard School
and Lincoln Center.
But what really sets Columbus Circle apart is the
Turnstyle Underground Market in the concourse between
57th and 58th streets, the
work of a private developer
who signed a multidecade
lease on the space.
Converting the once-desolate passage into a 28,000
square-foot market appealing
to New Yorkers of every stripe
was a challenge, says developer Susan Fine.
She’s tweaked the tenant
mix since its 2016 launch to
include more services—like a
sleek Japanese barbershop
chain offering $20 haircuts in
15 minutes—and more food
options.
INDIAN LIMITED EDITION
TRIBUTE TO BURT MUNRO
The 40 small shops and kiosks are occupied largely by
local, independent merchants
renting space for $12,000 to
$20,000 a month. The 5% vacancy rate is less than half
that of the surrounding neighborhoods. “We think we’re a
better street than upstairs,
where it’s all banks and drugstores,” says Ms. Fine.
I’ll say. My beef shawarma
bowl and soda cost $16.50,
but the market’s 18 food vendors also offer $2 pizza
slices, arepas and an $8 heap
of fried chicken served in a
waffle cone. The communal
tables were packed with
bankers, students slurping
coffee, construction workers
and a mom sharing a poke
bowl with her toddler.
The shops, meanwhile, offer impulse buys such as
candy, flowers, wine, greeting
cards and makeup.
“The stores down here are
all unique,” said John Lutton,
a shopper at Dog & Co. “And
you can get a chicken and
waffle cone. Hello!”
Will we see more station
markets in coming years?
Jaqi Cohen, campaign coordinator for passenger-advocacy group Straphangers Campaign, says developers
probably won’t bother with
low-traffic stations. But we’ve
already seen a second example
at the busy Fulton Street hub
in lower Manhattan. Still,
what most straphangers really
crave, she says, isn’t amenities, but the basics: “better
service and accessibility.”
anne.kadet@wsj.com
Bill would lengthen
the wait for people not
immediately approved
by a federal check.
Dylann Roof, the gunman
who killed nine people at a
church in Charleston, S.C., was
allowed to buy the weapon he
used in the shooting because
his background check wasn’t
completed within the threeday window.
Tom King, president of the
gun-advocacy group the New
York State Rifle & Pistol Association, said the federal background-check system works
well now, except when states
don’t accurately report information that might disqualify a
buyer. He said in some cases,
such as those when a woman
might need a gun to protect
herself from a potentially violent domestic partner, 10 days
might be too long to wait.
“Would it have saved your
life if you had gotten it seven
days earlier?” Mr. King asked.
“Maybe.”
On Tuesday, Mr. Cuomo appeared alongside Aalayah Eastmond, a junior at Marjory
Stoneman Douglas High School
in Parkland, Fla., where 17 were
killed during a Feb. 14 shooting. She recalled how she hid
under the body of a fellow student. “No student should have
to hide under their classmate’s
body to survive,” she said.
.
©2018 Dow Jones & Co. Inc. All rights reserved. 6DJ6488
A10B | Wednesday, May 2, 2018
NY
* *
What
Competition?
BLOOMBERG
THE NEW
YORK TIMES
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Want to know more?
Contact CMO and EVP Suzi Watford at:
s.watford@wsj.com
THE WALL STREET JOURNAL.
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | A11
LIFE&ARTS
THE MIDDLE SEAT | By Scott McCartney
Farewell to Those Tiny Bottles
Hotels switch to wall-mounted shampoo dispensers to save money and plastic, but risk upsetting travelers set in their ways
“This is certainly not an
arbitrary decision,” he
says. “I don’t think that
anybody would perceive it
as a budget or a downgrade. Certainly in the testing we did, it did not come
across that way.”
Hotels say dispensers
are locked and tamper-resistant to prevent sabotage. Most are designed
with some clear plastic so
housekeeping staffers can
see how much remains.
Many hotels outside the
U.S. use wall-mounted dispensers, some only offering
one all-purpose soap/shampoo.
New York City-based finance professional Sydney
Chun thinks Marriott’s new
Tea Tree pump bottles will
remind people of using
soap dispensers in a public
restroom. But there are
benefits, she says. She has
long hair and needs a minimum of two hotel-sized
bottles to cover her hair, so
having big bottles helps.
“It does get old to call
the front desk and ask” for
more, she says.
Some chains are bucking
this trend. Choice Hotels, a
group of 6,800 franchised
hotels mostly under budget
brands, says it has decided
to stick with small bottles.
Customer feedback is
mixed, Choice says. Hotel
guests often don’t believe
the communal bottles are
clean, full and well-maintained.
“Guests really want to
get to their hotel room, including their bathroom,
and not see any evidence
of anybody else having
been there,” says Anne
Smith, Choice’s vice president of brand management
and design.
Noelle Nicolai, who leads
marketing for Wyndham
Hotel Group’s upscale
brands, likens bath products to bread at restaurants. If it’s mediocre, you
forget it.
“If done right, it can be
one of the top drivers of
delight and guest satisfaction,” she says.
Wyndham did extensive research and decided to increase the
size of some of its bottles from 30
milliliters to 50 milliliters to encourage guests to take them home.
“Maintaining that bottle experience…was really important to us,”
Ms. Nicolai says.
Wyndham and most other large
hotel companies send leftover
soap that’s been sanitized and repackaged to a charity called Clean
the World for recycling.
PHOTOILLUSTRATION BY C.J. BURTON
THOSE LITTLE bottles of
shampoo, conditioner and
body wash in hotels—icons
of travel—are disappearing, replaced by bulk dispensers mounted on
shower walls. And some
travelers are in a lather.
Marriott is switching to
larger bottles in wallmounted racks in 450 hotels at five brands and
plans to expand to 1,500
hotels in North America by
January. InterContinental
Hotels Group is rolling out
wall-mounted bulk dispensers at four brands this
year. IHG’s upscale Kimpton brand already uses big
bottles in showers.
Even a detail as tiny as
a 1-ounce bottle can fire up
travelers, meaning hotels
must put real thought into
tweaks like this. Just last
week, the musician Halsey
sparked a debate when
complaining on Twitter
that hotels don’t address
the needs of minority
guests with the shampoos
they provide.
Hotels say bulk dispensers cost less and are better
for the environment—billions of half-full bottles get
thrown away every year.
Think of it as roughly
1,000 bottles for every hotel room, multiplied by
more than 5 million hotel
rooms in the U.S.
Some customers, especially families packing into
rooms, want more than the
squirts you can get out of
little bottles. Several
chains have studied bottle
behavior carefully and discovered many travelers
find the wall-mounted
pumps easier to use. You
don’t have to get out of
the shower wet if you forget to bring bottles over
from the sink. The bulk
dispensers end the struggle to read small print
without glasses or fish a
bottle cap out of the drain.
But some road warriors
say wall-mounted racks
look low-class. They’re
steamed that removing
their prized individual bottles looks like just another
in a long string of amenity cuts
from hotels, like mouthwash, stationery, sewing kits and pens.
“What’s next, getting rid of the
packs of coffee and making us
scoop out of a can?” says Dennis
Lennox, a strategic communications consultant from Detroit who
spends more than 200 nights a
year in hotels. “I think it’s cheap,
incredibly cheap.”
Sometimes bulk dispensers are
empty, he says. But Mr. Lennox’s
bigger complaint is that, like many
travelers, he collects toiletries and
other giveaway hotel products and
delivers them to a homeless shelter.
Marriott says its change allows
it to offer higher-quality bath
products at lower cost and reduce
waste. Starwood Hotels had bulk
dispensers on shower walls at
some brands, and Marriott has
learned from that after it merged
with Starwood.
The change to larger 8.5-ounce
bottles includes an upgrade to
Paul Mitchell’s Tea Tree product
line at Marriott brands.
And the landfill waste can be
significant, says Liam Brown, who
is responsible for Marriott brands
like Courtyard, Residence Inn, Fairfield Inn and Springhill Suites in
the Americas. Little bottles are
never refilled and rarely recycled.
The initial 450 properties where
Marriott will make the change use
10.3 million little bottles a year, or
113,000 pounds of plastic, he says.
When the change reaches 1,500 hotels it means 34.5 million bottles,
or 375,000 pounds of plastic a year.
Savings will be small, Mr. Brown
says, at about $2,000 a hotel a
year. But Marriott says it did extensive testing and believes the
wall-mounted bottles will work
better. Mr. Brown says high-end
spas, including Marriott’s own
Ritz-Carlton spa showers, use bulk
dispensers.
CLOCKWISE FROM TOP LEFT: MANUEL HARLAN; JOAN MARCUS BRINKHOFF-MOEGENBURG; MATTHEW MURPHY; JOAN MARCUS
THEATER
‘SPONGEBOB,’
‘MEAN GIRLS’ LEAD
TONY NOMINATIONS
Lucy Kirkwood’s “The Children”
and John Leguizamo’s “Latin History for Morons.”
“MEAN GIRLS” and “SpongeBob
Ms. Rowling developed the
SquarePants” topped this year’s
story for “Cursed Child” with a
Tony Awards nominations with 12
creative team that includes writer
each, while “Harry Potter and
Jack Thorne and director John
the Cursed Child” emerged
Tiffany. It opened on
as the front-runner
Broadway in April after
among plays.
making a name for
The awards, preitself on London’s
sented by the
West End, where it
won a record nine
American Theatre
Olivier Awards—
Wing and the
the British equivBroadway League,
alent to the Toare set for June
nys—in 2016.
10. They will air
Even before the
on CBS, hosted by
show’s opening, it
Josh Groban and
set a Broadway boxSara Bareilles.
office record for
“Cursed Child,” a
Lauren Ridloff, a
plays, generating $2.1
spectacle-laden, twonominee for ‘Children
million in ticket sales
part play drawn from
of a Lesser God,’ with
for one seven-day
the world of J.K. Rowco-star Joshua Jackson. stretch while it was
ling’s popular books,
still in previews.
was nominated for 10
“Cursed Child” producers Sonia
Tonys on Tuesday, including best
Friedman and Colin Callender said
play, where it is up against Ayad
they were delighted and relieved by
Akhtar’s “Junk,” Claire van
Please see TONY'S page A12
Kampen’s “Farinelli and the King,”
BY CHARLES PASSY
‘Harry Potter and the Cursed Child’ was nominated for 10
Tonys, including best play.
‘SpongeBob SquarePants’ tied with ‘Mean Girls’ for the
most nominations, each receiving 12.
‘Mean Girls’ received several acting nods as well as a best
book nomination for writer Tina Fey.
Andrew Garfield was nominated for best lead actor in a
play for his ‘Angels in America’ performance.
.
THE WALL STREET JOURNAL.
A12 | Wednesday, May 2, 2018
LIFE & ARTS
MY RIDE | By A.J. Baime
WHITNEY CURTIS FOR THE WALL STREET JOURNAL
A Monster
Truck That
Crushes It
A couple months later, I came in to work one
morning and checked my Facebook. Six different people had posted a link to a Craigslist ad;
the monster truck High Roller II was on sale in
Oklahoma. High Roller II was one of the original wave of monster trucks, built in 1985 out of
a 1979 Ford F-350, in Fordsville, Kent.
The truck had been sitting in a field for
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Clockwise from below: Jeff Krekeler,
who bought the monster truck High
Roller II through a Craigslist ad in 2015,
for $8,500; fellow monster-truck fans
helped him restore it to its 1980s glory;
the truck crushed cars at a charity
event on April 21 in Bonne Terre, Mo.
Contact A.J. Baime at Facebook.com/ajbaime.
THEATER
Showroom
To advertise: 800-366-3975 or WSJ.com/classifieds
years and was in rough shape. I
negotiated a price of $8,500,
and immediately sold the
wheels and tires, so I was only
in for about $1,500.
I thought it would be fun to
have around. I had no plans to
restore it. But this is when, for
me at least, this story gets really interesting. I am a jewelrystore owner, not a mechanic.
But people came out of the
woodwork in the monster-truck
community to help give High
Roller II a new life.
We began to restore the truck
inside and out, top to bottom.
We re-created all the parts that
were missing or broken. One guy
helped rebuild a 1980s Pioneer cassette deck.
Now we use the truck in parades and to crush
cars for charity events. When you’re dealing with
a monster truck, everything is amplified—cost
and maintenance. Lucky for me, I have a small
army of volunteers that helps me keep it going.
Continued from page A11
the news. “We don’t take
anything for granted,” said
Mr. Callender. They expressed
gratitude to Ms. Rowling for,
in Ms. Friedman’s words,
“trusting us with her world.”
“Mean Girls” and
“SpongeBob SquarePants”
received nods for their acting performances as well as
categories such as direction,
choreography, scenic design
and costume design. Tina
Fey, who wrote the original
“Mean Girls” movie, picked
up a nomination for the musical’s book.
The competition for best
musical is often the most
high-profile race, but the focus has shifted to best play
this year in large part because of Potter mania. Still,
the musical nominees include three lavishly staged
shows—“Frozen,” “Mean
Girls” and “SpongeBob
SquarePants”—all based on
hit movies or TV shows.
In particular, “Frozen,” the
Disney-produced musical
based on the animated movie
of the same name, has been
among Broadway’s most anticipated shows this season.
It has played to near capacity
since opening in March.
But it is a fourth musical
nominee, “The Band’s Visit,” a
more modestly scaled production that looks at Arab-Israeli
relations, that has been the
season’s critical darling and is
seen by many industry insiders as the Tony front-runner.
Wall Street Journal theater
critic Terry Teachout called it
a musical of “wondrous
charm,” writing that it
“shows that the great American art form (give or take
jazz) is still full of life when
practiced by artists who trust
the taste and intelligence of
their audiences.”
“Band’s Visit” producer
Orin Wolf said he hoped the
Tony nod would “give us a
wider circle” and boost
ticket sales.
Revivals are some of the
most hotly contested Tony
categories this year. Plays
nominated for best revival
include a production of “Angels in America,” Tony
Kushner’s epic about the
AIDS crisis, and a staging of
Edward Albee’s “Three Tall
Women” that features actresses Glenda Jackson, Laurie Metcalf and Alison Pill.
Other nominees include revivals of Kenneth Lonergan’s
“Lobby Hero,” Eugene
O’Neill’s “The Iceman Cometh” and Tom Stoppard’s
“Travesties.”
In the best revival of a musical category, well-received
productions of two golden-age
shows, Rodgers and Hammer-
the best performance by a
featured actor in a play for
his portrayal of the New
York attorney Roy M. Cohn
in “Angels in America.” His
co-star Andrew Garfield was
nominated for best performance by a lead actor.
The acting nominations included some names who
aren’t as well known. Lauren
Ridloff was nominated for
best actress in a play for her
debut in “Children of a Lesser
God,” as the deaf woman at
the center of the drama.
“It hasn’t sunk in yet,”
said Ms. Ridloff, who had
never appeared in any professional theatrical production, on or off Broadway, before her “Children” role.
DEEN VAN MEER
Jeff Krekeler, 52, owner of
Krekeler Jewelers in Farmington,
Mo., on his High Roller II monster truck, as told to A.J. Baime.
The first monster truck, Bigfoot, came out of St. Louis in
the 1970s. I grew up an hour
south in Farmington, and I remember getting to see Bigfoot’s
creator Bob Chandler thrash
that truck through a mud pit
like a mad man, before the
truck became a national phenomenon.
A lot of people of my generation remember that truck. For
us, Bigfoot was a local hero.
In Farmington, we have a tradition where people turn up for
a homecoming parade each fall. For my 30th
high-school reunion in 2014, I had this idea to
get Bigfoot to pull a hay wagon in the parade. I
shot off an email and, amazingly, one of the
truck’s early drivers, Jim Kramer, brought the
original monster truck to the event.
It was a huge thing for our town. Ever since,
people have associated me with monster trucks.
Patti Murin and John Riddle in ‘Frozen,’ a best musical nominee.
stein’s “Carousel” and Lerner
and Loewe’s “My Fair Lady”
are competing against each
other, alongside an imaginative staging of the Caribbeanminded “Once on This Island.”
Ms. Jackson was nominated for best performance
by a leading actress in a play.
She has been nominated
three times before in the category but hasn’t won.
Ms. Metcalf, an Oscar
nominee this year for “Lady
Bird,” was nominated for
best performance by a featured actress in a play. She
won a Tony last year for her
performance in “A Doll’s
House, Part 2.”
Two-time Tony winner
Nathan Lane got a nod in
Not every show or star
earned Tony recognition.
Among the snubs: “Escape to
Margaritaville,” the jukebox
musical based on the songs
of Jimmy Buffett.
The man who is perhaps
the biggest star currently on
Broadway didn’t land a nomination, but he is already getting a Tony. Bruce Springsteen, whose “Springsteen on
Broadway” show has been
sold out since it started its
run last October, will be recognized with a special award.
Also being recognized with
a special Tony: actor and
writer Mr. Leguizamo, who
has presented a series of oneman shows on Broadway going back two decades.
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | A13
LIFE & ARTS
ART REVIEW
The Tune of Creativity
Chicago
THE MUSIC THAT plays continuously in the space where the Art
Institute of Chicago has mounted
“Volta Photo” is an integral part of
this photographic exhibition. The
bouncy sounds of Afro-Cuban and
indigenous West African songs
come from a huge gray bullhornshaped speaker above a display of
45 rpm record sleeves for the band
Volta Jazz. The pictures on the
sleeves show 12 musicians: In
some they wear red tuxedo jackets
with black shawl collars; in others,
casual street clothes; and in still
others, uniform outfits of native
patterns. The pictures were taken
between 1965 and 1975 in Bobo-Dioulasso, the commercial and cultural center of the country known
then as Upper Volta and now as
Burkina Faso, by studio photographer Sanlé Sory.
Ibrahima Sanlé Sory was born
in 1943 in Naniagara, a village
south of Bobo-Dioulasso. When Mr.
Sory went to live in the big city as
a teenager he needed an ID photo.
Impressed that the photographer
charged him 200 francs and seeing
the opportunity for a well-paying
job, he obtained an apprenticeship
with an established photographer
for 25,000 francs and a bottle of
whiskey. Three years later, he
opened his own photography studio, Volta Photo. The shop took ID
photographs, as did other similar
studios in Bobo, but Mr. Sory had
always been a fan of popular music and incorporated this enthusiasm into his business.
The advent of radio stations,
transistor radios, records and cassettes had broadened the native
musical culture, and Mr. Sory photographed all of it: the fan clubs,
the record sellers, the dance parties, the local musicians. In the
evening he left his apprentices in
charge of the studio and roamed
Bobo’s dance venues with his camera and Multiblitz flash. Idrissa
Koné, a cousin who had helped
him open his studio, also ran Volta
FROM LEFT: THE ART INSTITUTE OF CHICAGO; © IBRAHIMA SANLÉ SORY/FLORENT MAZZOLENI
BY WILLIAM MEYERS
Backdrop from Volta Photo, above, and Sanlé Sory’s ‘Fula Man’ (1970-80), right
Jazz, and Mr. Sory not only shot
its record covers, but performances and individual musicians.
His most unique practice, however, was to travel outside Bobo
to “the bush” and arrange bals
poussières (dust balls) in the villages. There is a picture of Photo
Volta’s Citroën 2CV truck used to
haul Mr. Sory’s equipment to
these dance parties: his generator, “funnels” (loudspeakers), amplifier, two tape decks, two cameras—a Yashica-Mat and a
Rolleiflex—and the Multiblitz
flash. Mr. Sory set off the flash
several times in sequence to signal the beginning of a party and,
while one assistant manned the
generator and another acted as
DJ, he roamed the floor taking
pictures. “Untitled” (1970-80)
shows a man and woman, both in
trousers and white tops, dancing.
In “Untitled” (1965-75) a woman
in a dress poses with a man in a
smart outfit.
In “A Village Party in the Kou
Valley” (1965-75) it is two men in
trousers and white T-shirts dancing. The parties typically went on
until sunrise.
In Bobo, Mr. Sory photographed “Idrissa Koné Emceeing
at a Volta Jazz Event” (1974-75)
and “Tiamodjan, the Lead Guitarist for Echo del Africa Nacional”
(1965-75), who plays while sitting
on another man’s shoulders.
“Fans of Cuban Music” (May 16,
1967) shows a row of women
kneeling and a row of men standing behind them, and in “Surprise
Party” (1978-80), a smiling couple
holds hands and faces the camera
while they dance. “Amadou Diallo,
Record Seller and Party Organizer” (1970-80) leans on a table
with DJ equipment and displays a
record sleeve.
At the end of the hall opposite
the bullhorn hangs one of the
painted backdrops from Volta
Photo, a street scene showing the
studio; and a telephone, a transistor radio, and an Air Afrique flight
bag: symbols of modernity that
Mr. Sory’s subjects could use as
props in their portraits. In “Untitled” (1965-75), a shirtless man in
trousers and a baseball cap stands
before that very backdrop holding
the phone to his mouth while another man stands arm akimbo be-
side him. In “Untitled” (1965-75),
two women stand before a painted
beach scene with a man who holds
a baby on his hip. The “Fula Man”
(1970-80) wears flowered trousers,
enormous sunglasses with white
frames and obviously considers
himself quite cool. Other studio
portraits show subjects in Western
and native dress, with various
backdrops and props; they are
studies in self-fashioning.
The prints in the gallery are all
vintage, small and somewhat
faded. They were not intended to
be art objects hung in a museum,
but personal mementos, and have
the aura of their original function.
This exhibition testifies to the
quality of Mr. Sory’s work and exemplifies the current interest in
vernacular, indigenous and studio
photography to better understand
the ways in which Africans see
themselves. In a interview with the
exhibition’s curator, Matthew Witkovsky, included in the show’s catalog, Mr. Sory says about his work,
“If there are not pictures, there are
no memories! If someone asks to
see a picture and there’s no picture
to show, it is as if nothing had happened. But if the picture is there,
we see what really took place.”
Volta Photo: Starring Sanlé Sory
and the People of Bobo-Dioulasso
in the Small but Musically Mighty
Country of Burkina Faso
Art Institute of Chicago,
through Aug. 19
William Meyers writes on
photography for the Journal.
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THE WALL STREET JOURNAL.
A14 | Wednesday, May 2, 2018
SPORTS
CHAMPIONS LEAGUE
REAL MADRID
MAKES FINAL
MADRID—The shrill, piercing
whistle of nearly 90,000 Real Madrid fans went on for minutes at a
time. It filled the cavernous Santiago Bernabeu Stadium here and
rang in the ears of the players—
Bayern Munich as it desperately
sought one more goal, Real Madrid
as it clung on to its advantage.
Then, drowned out by the noise,
the referee blew the only whistle
that mattered and half the men on
the field collapsed to the ground.
Real had hung on to the 2-2 draw
that, combined with a 2-1 victory
in the first leg, sent the two-time
defending champion into a third
straight Champions League final.
Real now awaits the winner of
the other semifinal between Liverpool and Roma, due to be decided
in Italy on Wednesday.
On paper, Real’s run to the final
has been stellar. In the knockout
rounds alone, the club has confidently eliminated this season’s
champions of France (Paris SaintGermain), the likely champions of
Italy (Juventus), and now the
champions of Germany (Bayern).
The reality, however, is less
smooth.
Its attack never overwhelmed
the German defense. Cristiano
Ronaldo went 180 minutes without
a goal and, more worrying for
Real, without making an impact.
And while it isn’t the team’s style
to rely on the heroics of a goalkeeper, Real found itself badly
needing Keylor Navas’s eight saves
on Tuesday night.
Real rode its luck, too. With
Tuesday’s game tied at 1-1, they
were offered a freebie by Bayern
goalkeeper Sven Ulreich, who misjudged a backpass and allowed Karim Benzema to skip through for
his second goal of the night.
Then again, no club goes
through a season as utterly convinced as Real Madrid that winning the Champions League is its
inalienable right. And with that
swagger, comes an uncanny trend
of things breaking Real’s way.
UE SYNDICATION/ZUMA PRESS
BY JOSHUA ROBINSON
Red Bull driver Daniel Ricciardo
drove into the back of teammate
Max Verstappen’s car on Sunday.
FORMULA ONE
Sorry We Crashed Our $15 Million Cars
After teammates got into a fender bender during a Grand Prix, the punishment was a public apology
“They’re representing the team
when they’re out on track. Obviously, there will be an apology to
all the staff going back to all the
staff in Milton Keynes,” Red Bull
team principal Christian Horner
said. “It shouldn’t happen...They
have to show respect to the team,
rather than just self-interest.”
How a teammate can even crash
into a teammate—and why it’s
such a disaster—is down to how
Formula One has evolved in recent
years. The sport has 10 teams, each
with two drivers at the wheel of
more or less identical cars. But the
disparity between the top three
teams and the rest is so great that
much of the season is determined
in the garages, long before any
rubber meets the road.
Last season, for instance, only
three teams posted victories on the
20-race calendar: Mercedes took
12, Ferrari earned five, and Red
Bull swept up the other three. The
2016, 21-race campaign was even
less dramatic on that front. The
Mercedes pair of Lewis Hamilton
and Nico Rosberg shared 19 wins
for the team while Red Bull settled
for the other two. In fact, no team
not named Mercedes, Ferrari or
Red Bull has won a single Grand
Prix since the 2013 season.
In other words, the sport has 20
cars at every event, but only six of
them across three teams are doing
any meaningful racing. So losing
both cars on your team to a moment of madness between your
drivers is a bad look, not to mention financially damaging. Totaling
BY JOSHUA ROBINSON
KAI PFAFFENBACH/REUTERS
SUNDAY AFTERNOON in Baku,
Azerbaijan, was shaping up to be a
decent day at the office for the Red
Bull Formula One team. Its two
drivers were sitting in fourth and
fifth places midway through the
race and set to take home a solid
points haul.
That is, until they did the one
thing that teammates are absolutely never, under no circumstance supposed to do in Formula
One. They crashed into each other.
“It’s a pretty crappy situation,”
said Red Bull driver Daniel Ricciardo,
who drove into the back of Max Verstappen’s car. “We want to race. We
are thankful that the team let us
race. This is the worst scenario, so
that’s the crappy part of it.”
Teammates in all sports let each
other down all the time. But no one
takes that crime more seriously
than Formula One. Mess up in other
sports and you might get benched.
For graver offenses, from missing a
curfew to losing your playbook, you
might even get fined.
But crash one of your team’s $15
million cars into another of its $15
million cars? Red Bull is punishing
that with the ultimate ignominy: a
public shaming.
The team announced on Monday
that both drivers would be made to
travel to its car factory in Milton
Keynes, England, and deliver a
heartfelt apology to the more than
800 Red Bull engineers, mechanics
and support staff.
Real Madrid players celebrate.
two cars in the same weekend is
about equivalent to watching your
newly signed, maximum-contract
free agent blow out his knee.
To prevent situations that lead
to risky passing moves, most
teams impose clear hierarchies between their drivers, organizing pit
stops and strategy around the one
with the best shot at a championship. This is known in the sport as
“team orders,” a term that has
been tainted since at least 2002,
when Ferrari’s Rubens Barrichello
led into the final corner of a Grand
Prix but moved aside to let his
teammate Michael Schumacher
take the victory and maximum
points in the standings.
The sport has done its best to
crack down on team orders and
Red Bull explicitly rejects any kind
of hierarchy between its drivers.
“We always let the drivers race,”
Red Bull executive Helmut Marko
said. “We don’t have a No. 1 and we
don’t have a No. 2.”
But it turns out that for a Formula One team, racing is the most
inconvenient part.
Ricciardo is the more experienced of the two, a 28-year-old
with 133 starts to his name dating
back to 2011. Verstappen, meanwhile, is only 20 and came to F1 as
the sport’s child prodigy. He won
his first Grand Prix at 18 and has
already made over 60 starts. But
he has a reputation for being
somewhat erratic on track. A popular website called crashstappen.com asks, “Has Max crashed
yet?” and tracks the time since his
The WSJ Daily Crossword | Edited by Mike Shenk
Weather
Shown are today’s noon positions of weather systems and precipitation. Temperature bands are highs for the day.
d
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Vancouver
Por
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81 64 t
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International
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Brussels
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Today
Hi Lo W
61 42 c
81 65 pc
91 70 pc
90 78 t
75 50 pc
58 50 pc
61 40 c
69 61 t
95 82 s
53 40 sh
54 38 sh
Tomorrow
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89 68 t
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77 51 s
66 43 sh
58 39 pc
72 59 c
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55 48 pc
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Tomorrow
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66 45 pc
61 50 c
87 68 pc
86 74 t
77 61 pc
91 76 pc
83 62 pc
71 46 s
58 44 pc
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5 Setting of many
1960s tours
8 Parasitic pest
24 Current Kenyan
president
Kenyatta
25 Brooklyn ballers
26 “Calvin and
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12 Donut store
choice
28 Curry is popular
here: Abbr.
13 Laudatory lines
30 She won an
Oscar as Loretta
14 Static
16 Stick
17 Morse click
32 One of the few
survivors in
“Hamlet”
18 Needs a hot
bath
34 “Adorbs!”
19 Procrastinator’s
promise
39 “Dinner’s ___!”
20 Captain in “The
Caine Mutiny”
22 “Fiddlesticks!”
23 Stock collection
36 Receiving rooms
32 One who knows
Bellini from Bizet
49
3 Well-known
round
33 What might end
the year, and a
hint to five
answers in this
puzzle
4 Big seller,
supposedly
34 Put one’s nose
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5 “Obviously!”
35 Brief scrutiny
53
57
58
61
64
44 Big hit
46 Org. with a
MonsterMind
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47 Rent out
48 At dinner for
two, maybe
49 Whitesmiths
work with it
50 Summons to a
waitress
52 Results of not
cutting it close?
54 Certain athletic
shoes
55 Start of
Terpsichore
40 Basketball Hall of
Famer Dan
57 Miniseries of
1977 and 2016
42 Mincemeat pie
ingredient
59 Movie mutt
43 Road hazard
31 Darth Vader’s
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1 Oscar
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2 Willing to try
KEY FIGURES | By Rich Proulx
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30 Hit drama about
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46
42
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62 Ballpark
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64 Rips apart
29
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27 The Buckeyes’
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61 Cary of “The
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63 Yellow card
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22
36
43
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60 Storied toymaker
Solve this puzzle online and discuss it at WSJ.com/Puzzles.
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s...sunny; pc... partly cloudy; c...cloudy; sh...showers;
t...t’storms; r...rain; sf...snow flurries; sn...snow; i...ice
Today
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City
Hi Lo W Hi Lo W
Anchorage
45 36 c
45 37 sh
Atlanta
84 60 s
85 62 s
Austin
86 70 pc 84 66 t
Baltimore
88 64 s
90 67 s
Boise
70 45 s
76 51 s
Boston
86 64 s
84 66 pc
Burlington
81 63 pc 74 57 t
Charlotte
85 57 s
85 59 s
Chicago
80 65 c
75 61 t
Cleveland
80 65 pc 78 62 t
Dallas
85 69 pc 81 67 t
Denver
57 38 c
54 38 r
Detroit
81 66 c
78 65 t
Honolulu
82 70 r
82 73 c
Houston
86 70 pc 85 68 c
Indianapolis
83 66 pc 78 65 t
Kansas City
84 68 c
80 56 t
Las Vegas
67 55 sh 80 63 s
Little Rock
84 68 pc 83 67 t
Los Angeles
65 53 pc 70 56 s
Miami
83 75 t
83 75 pc
Milwaukee
78 54 t
63 49 t
Minneapolis
69 52 c
74 52 pc
Nashville
85 65 s
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New Orleans
86 65 s
84 68 pc
New York City
86 68 s
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Oklahoma City
83 67 c
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last mishap with a live counter.
In Baku, the battle had been
simmering all race. Three times,
the pair flirted with taking each
other out, even kissing wheels on
one occasion.
On Lap 40, it all blew up in their
faces. With Verstappen just in
front of him, Ricciardo ducked
right, then left, looking for a gap
to exploit. Then, delaying his braking to make one more run at his
teammate ahead of a left-hand
curve, he ran into the back of his
teammate. Both cars were done.
There is some technical debate
over who is precisely to blame. F1
rules designed to promote overtaking prohibit the car defending its position from making more than one
defensive move and changing its line
under braking, which may be what
Verstappen did. But the race stewards meted out the blame equally.
“Both drivers contributed to the
collision,” the sport’s governing
body said in a statement. “It was
obvious to the stewards that although the incident had its origins
in the moves by car 33 [Verstappen], the driver of car 3 [Ricciardo]
also contributed to the incident.”
The team says it will move past
the incident. All that remains now
for these men who make their careers at 200 miles per hour is to
slowly trudge through the Red Bull
factory and say they are sorry.
“Before the accident it was hard
racing but fair, I think, and we
gave each other space,” Verstappen
said. “But what happened afterwards is not good.”
6 Leaving word
37 Withstood
7 Cab component
38 Jazz legend
Kenton
8 Soccer superstar
Hamm
41 But, to Brutus
9 Band with the
44 Dark Chinese
Grammy-winning
sauce
“Wish”
45 Less distant
10 Titter
51 Goya’s naked
11 Having perfect
subject
posture
53 Part
12 Use a pestle
54 Blood-typing
15 Sounds of
disapproval
letters
56 It may be blonde
or brown
20 Deduction
game
58 Parseltongue
sound
21 Military tribute
Previous Puzzle’s Solution
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.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | A15
OPINION
Please, No Tweet on T-Mobile Deal
The first hurdle to the
proposed
Sprint and TM o b i l e
merger is a
Trump tweet.
BUSINESS
So far, it
WORLD
hasn’t come.
By Holman W.
If Ajit Pai is
Jenkins, Jr.
smart,
he
will lobby the
White House to make sure it
never does.
Mr. Pai, chairman of the
Federal Communications Commission, cares about good policy. That hasn’t been the rule
for years. During the Obama
era, tech and telecom policy
were driven by White House
interest in whipping up millennials and exploiting public
hostility to cable providers.
There is mixed evidence so
far from the Trump administration. Its deregulation efforts, though you’d never know
it, have been largely aimed at
rules, especially related to climate change, that are symbolic, costly and devoid of real
social benefit.
Then there are Mr. Trump’s
trade and antitrust spasms,
one of the worst, now unfolding in court, being his administration’s attack on the proposed merger of AT&T and
Time Warner.
Much debate has surrounded
the question of whether Mr.
Trump’s anti-merger tweet during the campaign is the reason
for the Justice Department’s
lawsuit blocking a deal that Republicans might normally be
friendly toward. So predisposed is the Beltway hive to
turn merger review, especially
involving high-profile media
and telecom companies, into a
political circus, all we can say is
that Mr. Trump’s tweet hardly
helped the parties steer the
narrow path to a politically unmolested deal.
The Sprint and T-Mobile
proposal is further cursed with
an interesting cast of characters. T-Mobile chief John
Legere rivals Mr. Trump for
Twitter prowess and easy vulgarity, though he has done
much better by his public
shareholders than Mr. Trump
did during his casino-owning
days.
Sprint is owned by the Japanese wunderkind and visionary Masayoshi Son, whose
dreams have only gotten bigger even as his Sprint play has
faltered on U.S. regulatory
politics.
Then there’s the nationalsecurity wild card, because TMobile is German-controlled
(Deutsche Telekom owns a big
stake), which means the interagency panel with the medical
sounding name, Cfius (for
Committee on Foreign Investment in the U.S.), will have one
of many vetoes.
The parties already have
started playing up the need to
“win” in 5G against China, a
Trump hobby horse. Unfortunately, their rhetoric may repeat the mistake of the failed
AT&T and T-Mobile deal of
2011, when the parties attached themselves the thenObama hobby horse of a “spectrum shortage” only to find
that with an election approaching, the administration
lost interest in the alleged
spectrum shortage in favor of
reinforcing its antibusiness
bona fides.
The right defense of the TMobile and Sprint merger is
that the parties and their
shareholders want it, and no
compelling public interest justifies interfering with their
judgment about how to advance their business.
This is where we hope Mr.
Pai asserts himself. He actually
knows a thing or two.
Merger review is a
swamp that needs to
be drained to make
America great again.
Quietude has temporarily
descended on the fiercely competitive wireless market now
that all the big carriers offer
unlimited plans, but this
wasn’t a favor for customers—
it was a recognition that wireless is already in competition
with the local cable carrier for
a lot of “mobile” data traffic.
The coming 5G world will finally blow up the distinction
between fixed and wireless for
good.
At the same time, Netflixstyle streaming has killed the
TV profits that paid for the nation’s broadband rollout. Then
there’s this: Apple’s reported
role behind a Justice Department investigation aimed at allowing mobile users to switch
devices at will from one carrier
network to another.
The longer-term promise
of 5G (driverless cars, artificial reality) is real, but the
immediate business case is
limited, mainly permitting
wireless to challenge cable in
the home market.
In the meantime, a boondoggle looms. We already are
catching whiffs of Europe’s
3G debacle, which wiped out
$700 billion in equity values
in the early 2000s, egged on
by continental politicians
who believed they were in a
race against Japan and the
U.S.
The China 5G threat is a canard. What the U.S. could really use right now is a merger
review, for once, free of hysterical politicking and eschatological exaggeration.
What Mr. Trump meant by
“drain the swap” is anybody’s
guess, but the excesses of the
administrative state won’t be
corralled with a slogan. Witness the media’s dwelling this
week on Ford’s decision to
prefer “trucks” over “cars”
without ever noticing that
Ford is basically conforming to
artificial categories created by
the interaction of Washington’s by-now utterly perverse
fuel-economy rules and “light
truck” tariffs.
Our economy needs less of
this, but here’s the rub: We
can’t tackle our runaway administrative state—everything
from occupational licensing to
zoning laws that create local
housing and worker shortages—until our doofus media
allows us to see that the problem exists. Opening up this
subject would do far more than
any 5G policy to strengthen the
U.S. economy to compete with
China and others in the decades ahead.
Three Tests for Trump’s Art of the Deal
The next six
weeks
will
shape American diplomacy
for years to
come—and
POLITICS test the efficacy of Presi& IDEAS
dent Trump’s
By William
signature apA. Galston
proach to foreign policy.
The contours of Mr.
Trump’s strategy have become
clear. He approaches each issue as a zero-sum negotiation
that produces winners and
losers. To put himself on the
winning side, he tries to maximize two things: leverage and
doubt. Within this framework,
threats do double duty: They
remind other parties what
they could lose and cause
them to wonder whether he
will follow through, given that
the consequences might seem
negative for his side, too.
Trade negotiations with
China provide an early test of
these tactics. When the Chinese were unresponsive to
previous demands and threats,
the Trump administration imposed tariffs—not as a permanent policy, but as a way of
bringing Beijing to the bargaining table in a more forthcoming spirit. The pending
trip to China by Treasury Secretary Steven Mnuchin and
Trade Representative Robert
Lighthizer should reveal
whether Chinese officials now
are prepared to address their
country’s overcapacity in industries such as steel and
aluminum, compulsory technology transfers, and intellectual-property theft. If they are
not, Mr. Trump will either
have to scale back his objectives or escalate further—risking an all-out trade war.
If the end result is a barrage of tariffs, it will show
how the president’s win-lose
negotiating template can produce lose-lose results. The
Chinese have already struck
back at U.S. agriculture, one of
America’s great export success
stories and (not coincidently)
an industry that overwhelmingly supported Mr. Trump in
the 2016 election. China’s undemocratic political system
may prove better than ours at
enduring short-term pain in
pursuit of long-term gain.
A second big test for the
administration’s foreign policy
comes May 12, the deadline
for deciding whether to stay
in the Iran nuclear deal,
known as the Joint Comprehensive Plan of Action. Mr.
Trump has done his best to
persuade the European signatories that the deal is fatally
flawed and must be renegotiated to eliminate its sunset
clauses, among other things.
The Franco-German position
is that the current deal should
stand, but new agreements
should be created to address
other aspects of Iran’s behavior, including its missile development and its destabilizing
projection of power throughout the Middle East.
If Mr. Trump stands firm
and withdraws the U.S. from
the JCPOA, he will drive a
wedge between America and
its closest European allies. By
far, it would be the most consequential breach in the postwar alliance since the beginning of his administration,
and perhaps since George W.
Bush’s decision to invade Iraq.
Writing in these pages Monday, Jamil N. Jaffer argued
that if the president turns his
The president’s gambit
of maximizing pressure
is playing out in China,
Iran and North Korea.
back on the JCPOA and reimposes sanctions on Iran, the
Europeans will be forced to go
along, because the alternative
would be ceasing to do business with the U.S. Perhaps so,
though it isn’t clear that even
the Trump administration
would be willing to treat
American allies so harshly.
Coercion breeds resentment,
after all, and resentment
breeds revenge—a dish Europe may choose to serve
cold, a few years down the
line. Again, win-lose can turn
into lose-lose.
This brings us to the biggest gamble of Mr. Trump’s
presidency: The coming summit with North Korea’s Kim
Jong Un. Mr. Trump boasted
at a campaign-style rally in
Michigan last weekend that
his policies had “everything”
to do with the North Korean
dictator’s willingness to sit
down with him face to face.
Mr. Kim may well have a different view of the matter.
Having achieved the ability to
strike the U.S. with nuclear
weapons, he is now in a position to achieve hitherto unthinkable terms: a formal end
to the Korean War, diplomatic
recognition of his regime, and,
possibly, de facto acceptance
of North Korea as a nuclear
power. He may also believe
that formally ending the war
will open the door to the foreign investment his country
desperately needs.
Mr. Trump believes his
threats have increased his leverage over North Korea. Mr.
Kim believes his weapons
have increased his leverage
over the U.S. This may well induce each side to make demands that the other cannot
accept.
Every American must hope
that when President Trump sits
down with North Korea’s “supreme leader,” the two men
will be able to agree on
enough—including an action
plan and future meetings—to
permit both to declare the
summit a success. But that outcome is not foreordained.
Hastily convened international meetings are high-risk
affairs. This one may be worth
the risk. But if it fails, the U.S.
and North Korea could find
themselves closer to war than
at any time in the past 65
years. What will the Trump
administration do then?
Freer Markets, Freer Media
By Kevin Brookes
And Patrick Déry
S
ixty-five journalists were
killed while plying their
trade in 2017, according
to a report from Reporters
Without Borders. This was the
grimmest detail from the organization’s press-freedom update, which depicts dark times
for the media. This Monday,
nine journalists were among
at least 25 people killed in two
bombings in Afghanistan.
Our suggestion to help
make journalists safer around
the world: Expand economic
freedom. Press freedom is indispensable to democracy. But
economic freedom is a necessary condition for freedom of
the press. In modern times,
there has never been a democratic society that respects
individual rights without at
least a minimum of economic
freedom.
The first newspaper was
launched in early-17th-century Germany because its
publisher envisioned a profitmaking opportunity—and he
had the freedom to pursue
the project. The principle
persists today. In a real market economy, an avid defender of socialism will always have the possibility of
finding donors, investors and
Want to protect
reporters? Promote
economic liberty.
readers to finance the dissemination of his opinions.
But in an economy controlled
by the government, diverging
opinions will have greater
difficulty being heard because of bureaucratic obstacles, the difficulty of finding
financing, and even outright
censorship. A good way to silence a media outlet is to tax
or regulate it.
The freer a country is economically—and the more it
facilitates the entry of new
actors into the market—the
greater the chance that the
press will be free. A study
just published by the Montreal Economic Institute confirms this strong and significant link.
In Western Europe and
North America, free markets
and a free press generally go
together. Countries with a
low level of economic freedom—think Venezuela, Bolivia, Argentina or Algeria—
also have a low level of press
freedom. By increasingly controlling and regulating their
economies over the past decade and a half, the governments of these countries have
substantially wounded the
media.
Interestingly, economic freedom is most conducive to
press freedom in poorer parts
of the world. The strength of
the relationship between the
two freedoms is twice as
strong in low- or lower-middleincome countries than in the
highest-income countries.
Certainly, free markets do
not by themselves guarantee
more press freedom. Singapore has a high level of economic freedom but a low
level of press freedom. But
the data show that a minimum level of economic freedom is a necessary precondition to ensuring a minimum
level of press freedom: For
2015, the last year for which
data is available, no country
with a free press is in the
bottom quartile of economic
freedom.
In countries with a high
degree of economic freedom,
fewer journalists are attacked, fewer laws and regulations are imposed on the
media, and there is less political pressure to control content. Economic freedom is
simply good for journalists.
Messrs. Brookes and Déry
are public-policy analysts at
the Montreal Economic Institute.
BOOKSHELF | By Julian Baggini
How Our Minds
Are Made Up
The Consciousness Instinct
By Michael S. Gazzaniga
(Farrar, Straus & Giroux, 274 pages, $28)
W
hen someone writes that they want to “examine how
matter makes minds” and “present a new view of
how to conceptualize consciousness,” you would be
justified in raising a skeptical eyebrow, even when that
person is the distinguished psychologist Michael Gazzaniga.
Mr. Gazzaniga is famous for, among other things, his
studies of patients who had the connections between their
cerebral hemispheres severed. He and Roger Sperry showed
that it is possible for one human being to house two
consciousnesses, with each hemisphere aware of things the
other is not.
Mind-boggling though these findings are, they would
seem to leave unanswered the deep question of how neural
activity gives rise to conscious experience in the first
place. Philosopher David
Chalmers famously called this
the “hard problem.” Many
have argued that “intractable”
would be more accurate.
Mr. Gazzaniga does a better
job of tackling the problem
than innumerable philosophers
and neuroscientists before him.
As in his previous books on
selfhood and free will, “Human”
(2008) and “Who’s in Charge?”
(2011), the author displays a rare
ability to combine breadth and
depth of scientific learning with
good, grounded philosophical judgment. As
a result, “The Consciousness Instinct” could be
the clearest and most compelling attempt to demystify the
mind yet written.
Mr. Gazzaniga’s approach echoes those of the American
pragmatists of the late 19th and early 20th centuries, who
believed that most philosophical problems needed not
solving but dissolving. “Intellectual progress usually occurs
through sheer abandonment of questions together with both
of the alternatives they assume,” wrote John Dewey. Mr.
Gazzaniga is not the first to suggest that the consciousness
debate is hampered by just such a set of false alternatives:
matter or mind, body or spirit. The dualist assumption that
these are two mutually exclusive categories inevitably
makes their reconciliation impossible, leading otherwise
brilliant thinkers since Plato to abandon “their fierce
reasoning skills and, deus ex machina,” throw in “a spook at
the end of their analysis.”
To escape the dualist trap, Mr. Gazzaniga takes as his
unlikely inspiration Aristotle’s ancient distinction between
four different kinds of causes. This review, for example, has a
material cause (paper and ink), a formal cause (the shape of
the letters on the page), an efficient cause (me writing it) and
a final cause (to inform people about the book). Whether or
not this taxonomy is entirely correct, it illustrates how “no
one mode of explanation” suffices to understand anything,
because the causal categories do not entail each other.”
Mind or matter? Body or spirit? This
could be the clearest and most compelling
attempt to demystify the mind yet written.
Mr. Gazzaniga updates this basic insight with the
quantum-physical concept of complementarity, that “a single
thing can have two kinds of description and reality.” We can
think of matter as waves or particles, but not both at the
same time. Similarly, the micro world of quantum physics
follows different laws than the macro world of classical
physics. “They inhabit different layers of description,” Mr.
Gazzaniga writes, “and one is not reducible to the other.”
The author’s point can also be made by thinking about the
relationship between fundamental physics and biology. Both
are hard sciences, but you simply cannot do the work of one
with the other. Everything is made up of matter, but at
different layers of organization different ways are needed to
understand and describe it. This simple point cuts to the
essence of Mr. Gazzaniga’s dissolution of the puzzle of
consciousness. Once we accept that humans contain layers of
physical organization, none of which can be wholly reduced
to another, it is no longer puzzling that what goes on in the
brain can have an objective, physical description and a
subjective, mental one.
Crucially, Mr. Gazzaniga also argues that it is wrong to
attribute causal potency to only one layer—for instance, to
suggest that neuronal firings can cause actions but
decisions cannot. Heretical though this is to hard-nosed
reductionists, Mr. Gazzaniga agrees with his mentor,
Sperry, that “consciousness may have real operational
value, that it is more than merely an overtone, a byproduct, epiphenomenon, or a metaphysical parallel of the
objective process.”
Mr. Gazzaniga is very good at looking under the hood of
consciousness to explain how its workings naturally follow
from the ways in which the brain is organized. It is a hugely
complex system with a layered, modular architecture, which
enables it to “efficiently process multiple types of
information concurrently.” Neuropathology provides the
clearest evidence for this. When people lose areas of brain
function, not only do they often not notice but they carry on
functioning remarkably well. If the brain were a more unified
“enchanted loom,” Mr. Gazzaniga argues that “removing
portions of the brain or stimulating erroneous processing in
some circuits would either shut down the system entirely, or
cause dysfunction across all cognitive realms.”
Consciousness is not therefore a property of a central,
single executive controller. What we perceive as
consciousness is simply whichever module is most active,
meaning that “its processing becomes the life experience,
the ‘state’ of the individual at a particular moment in time.”
Mr. Gazzaniga might be mistaken to nail his flag so firmly
to the mast of the physicist-cum-theoretical biologist
Howard Pattee. And he is almost certainly wrong in some
details. But on all the main points, his instincts on
consciousness are sound. Awareness is not the “special
sauce” that brings dumb biological processes to subjective
life but an emergent property of immensely complex
neurological processes. This does not so much eliminate the
mystery of consciousness as make it no more or less
mysterious than the ultimately inexplicable existence of the
universe itself.
Mr. Baggini is the author of “A Short History of Truth” and
“The Edge of Reason.”
.
THE WALL STREET JOURNAL.
A16 | Wednesday, May 2, 2018
OPINION
LETTERS TO THE EDITOR
Trump’s Antitrust Bust
Cancer Hospital Advertising Offers Real Hope
ou can tell a lawyer is losing a case monthly viewers. Netflix has 125 million subwhen he offers the court an exit ramp scribers, and Amazon Prime counts 100 mileven before a verdict. That’s how the lion members.
Justice Department is trying
About 3.3 million U.S.
The feds failed to make households dropped tradito save its floundering antitrust case against an AT&Tpay-TV subscriptions
their case against the tional
Time Warner merger, and we
last year. AT&T’s DirecTV lost
hope federal Judge Richard AT&T-Time-Warner tie. 188,000 of its 20 million satLeon doesn’t fall for it.
ellite subscribers during the
The six-week trial brought
first quarter, which contribby the government ended with final argu- uted to a $660 million decline in video revements on Monday, and it hasn’t gone well for nue. Why would a combined company risk losthe feds. This tends to happen when would-be ing more revenue?
trust-busters bring a case divorced from ecoJustice relied at trial on an economic study
nomic reality.
by University of California, Berkeley, professor
The AT&T tie-up would unite distribution Carl Shapiro, who was deputy antitrust chief
and content, and the last time Justice tried in the Obama Administration. Mr. Shapiro calto block such a “vertical” merger was 1977. It culated that the merger would cost consumers
lost, and courts have held since that trust- $286 million using a model that Judge Leon
busters must present real-world evidence that called a “Rube Goldberg contraption.”
vertically integrated companies would reduce
Several economists dispute Mr. Shapiro’s
competition and harm consumers. The feds assumptions. University of Chicago economics
didn’t come close to making that case.
professor Dennis Carlton noted that the study
AT&T and Time Warner want to merge so overestimated the number of people who
they can better target ads and content to would become DirecTV customers if AT&T
viewers—something neither can do on as well withheld Turner networks from competitors
on its own. The goal is to make companies while underestimating cord-cutters. Mr. Shamore competitive in the fast-evolving and piro acknowledged that “the real world is
consolidating media market.
messy,” which Justice seems to deny.
Justice claims that AT&T would use Time
AT&T has offered to arbitrate content fees
Warner’s “valuable and highly popular net- with other pay TV distributors, which would
works” like CNN and HBO as leverage to obviate Justice’s concerns about anti-competiraise carriage fees. If competitors didn’t tive behavior. And Justice seems to know it is
pony up, the government claims, Time War- losing because in closing arguments it offered
ner would go dark, thus pushing more cus- AT&T the same condition for approval it made
tomers to sign up for DirecTV. Prices would before suing: Divest Turner networks.
supposedly rise.
But this would sharply reduce the value of
But such content blackouts cost networks the merger and help rivals that might want to
hundreds of millions of dollars in subscription scoop up Turner’s supposedly “must-see” conand advertising revenues. Time Warner execu- tent for the same reasons AT&T does. Would
tive Coleman Breland, who previously oversaw Justice sue to stop Charter or Dish Network
cable fee and satellite TV negotiations, testified from buying Turner networks? What about Apduring the trial that going dark on Dish Network ple, which showed interest in Time Warner becost it $150 million. To drive a significant in- fore AT&T’s offer?
crease in customers, AT&T would have to withJustice is trying to pick winners and losers
hold Time Warner content from all its rivals, in a market that has plenty of choice and comwhich would be even more costly.
petition. A government victory would mean
That’s especially true as new entrants vie full employment for the antitrust bar, but it
for eyeballs. Silicon Valley giants are drawing would do nothing for consumers. Judge Leon
cord-cutters by creating and distributing con- should send the Trump trust-busters back to
tent. Google’s YouTube boasts 1.6 billion their law books for remedial study.
T
The Tariff Uncertainty
he White House on Monday granted EuWhen in doubt about government policy,
rope, Mexico and Canada a reprieve until businesses get cautious. They hold back investJune 1 on U.S. steel and aluminum tar- ment or slow down purchases. This is one of the
iffs, which is better than imgreat lessons of the last AdTrump’s assault on
posing these border taxes on
ministration. Barack Obama
consumers and businesses. But
imposed record levels of regutrade
takes
a
bite
out
if President Trump wants to
lation and periodically threatof U.S. manufacturing. ened new taxes. Mr. Trump
understand the economic risks
of his trade protectionism, he
has reduced those threats, but
should look at Tuesday’s dehis tariffs and antitrade rhetocline in the Institute for Supply Management’s ric are creating new worries.
monthly manufacturing gauge.
Mr. Trump and his trade apologists claim
The measure fell to 57.3, still healthy but all of this is merely canny negotiating, and
down two points from a nearly 14-year high in perhaps the President even believes it. But
February. Tim Fiore, who supervises the ISM CEOs can’t make decisions out of his head.
survey, told the Journal that more than a third They have to decide to invest or not, or make
of those responding to the survey cited tariff purchases or not, based on commercial realdisruptions or concerns. Will they have to pay ity. And the evidence is growing that Mr.
25% more for vital steel components or 10% Trump’s trade policies are harming U.S. manmore for aluminum, and can they count on their ufacturers and reducing the economic growth
regular suppliers?
he promised voters.
M
Cleaning Up After Cordray
ick Mulvaney has been doing yeo- sulting group found the CFPB’s complaint dataman’s work cleaning up after Richard base to be unreliable.
Cordray at the Consumer Financial
When Navient began to research and depose
Protection Bureau. One mess
alleged victims, the CFPB’s
The CFPB assault
he may have overlooked is the
claims didn’t hold up. One tesbureau’s dubious lawsuit
tified that he had enrolled in
on Navient crumbles
against student-loan servicer
an income-driven repayment
under discovery.
Navient.
plan from 2011 until 2015 but
Mr. Cordray spent four
no longer qualified because
years scouring every nook and
his income was too high. Ancranny of Navient’s business. Navient produced other said she enrolled in forbearance so she
450,000 pages of documents, hundreds of hours could apply for an unemployment deferment,
of phone recordings and more than 30 written which a Navient agent had discouraged. One
reports. Two days before President Obama left even told the CFPB he had no information supoffice, Mr. Cordray sued Navient for “systemati- porting its claims. The bureau has removed two
cally and illegally failing borrowers.”
of these witnesses and four others that Navient
The bureau charged that Navient incor- sought to depose.
rectly put struggling borrowers in forbearance
Meantime, the CFPB has been slow-walking
(during which interest accrues) instead of en- Navient’s discovery requests. Navient served
rolling them in income-driven repayment the bureau with the requests last June. Eight
plans that would allow some to pay nothing months later CFPB said it had identified
and discharge their balances after 20 years. 478,000 potentially responsive documents. But
In other words, Navient failed to help students by March 6, CFPB had still only produced 800
qualify for maximum loan forgiveness on the documents, about half of which were duplicataxpayer’s dime.
tive including 180 autoreply emails to its press
CFPB says Navient had a profit motive to release announcing the lawsuit.
place borrowers into forbearance because it’s
Mr. Cordray staffed the bureau with his ideoquicker and easier than guiding them through logical allies, and they’re continuing to serve
income-based repayment plans. But the Educa- him faithfully. The Navient lawsuit provides Mr.
tion Department pays loan servicers 63% less Cordray another business-bashing credential as
for accounts in forbearance than those in in- he runs in the May 8 Democratic primary for
come-based plans. The department also directs Governor in Ohio.
more accounts to servicers with high customer
The left is howling at Mr. Mulvaney’s prosatisfaction rankings.
posal this week to close public access to the
According to Navient, about half of direct CFPB’s complaint database. But the Navient degovernment loans that it services are enrolled positions show that many of the complaints are
in income-driven plans. That’s more than any unreliable and serve no other purpose than to
other Education Department contractor save give grist to trial lawyers and tarnish the repuAES-PHEAA, which is specifically tasked with tation of law-abiding businesses.
handling public-service loan forgiveness.
Mr. Mulvaney should drop the lawsuit and
When Navient asked a CFPB official during pay Navient restitution for its litigation costs;
a deposition last June to identify borrowers Na- Navient says it spent $7 million in the past two
vient had harmed, the official couldn’t. CFPB fiscal quarters alone. The CFPB should also
then selected 58 borrowers from its complaint hand over the documents Navient requested,
portal without vetting to serve as witnesses. Yet which may reveal bad faith by the bureau and
a February study by the NERA Economic Con- merit a Congressional investigation.
In his April 21 op-ed “In the War
on Cancer, Truth Becomes a Casualty” Prof. Steve Salerno seems to be
advocating for yet broader government control over what information
we ignorant citizens are given to consider and on which to base our decisions. As the husband of a woman
fighting ovarian cancer, I find the
premise of this message insulting and
condescending. Does the professor
believe we folks aren’t aware of the
lethality of cancer? Does he not believe we have the sense to seek out
information respecting the mortality
rates of a given cancer form? Would
he have us hear stories about how
“Joe” suffered and died rather than
about how he managed to beat the
disease? In closing his argument, the
professor observes that this is “about
depriving Cancer Inc. of the ability to
exploit false hope,” after having begun his complaint with a reference to
the ads run by MD Anderson Cancer
Center. My wife is being treated at
MD Anderson. The focus of her very
excellent oncology team has been on
optimizing her mortality prospects.
From the onset of their care and
treatment, they have fostered in us a
genuine and supportable hope for a
positive outcome. This is just as we
would have it.
What is “false hope”? I wouldn’t
leave it to either the good professor
or the government to be the judge of
that.
TOM CHANDLER
San Antonio, Texas
Mr. Salerno misses the point that
the MD Andersons, Sloan Ketterings,
Fred Hutchinsons, Dana-Farbers, etc.,
are some of the major research centers in the world. This is where the
majority of new care and treatment
advancements will take place. These
institutions need revenue to continue
the very expensive research process.
There is no doubt that the process is
competitive. These places are also the
breeding ground for new oncologists
and surgical oncologists that will migrate to the many community centers
treating patients where we live. That
process is also competitive and
costly.
It is important to note that although grim statistics of survival in
some cancers is a truth, it has been
shown that patients who participate
in clinical trials at these sites receive
a higher quality of care and experience a higher quality of life during
treatment.
ALLEN R. KRASKA
Venice, Fla.
Look at the therapeutic role of
hospital advertising. Just as drugs
help lower cholesterol or blood pressure, advertising helps raise patients
with symptoms to get off their chairs
and go see a doctor. Even the most
amazing advances in anticancer medicine work only for patients who get
diagnosed and treated, so advertising
may help save lives, just as drugs do.
I’ve had blood cancer for 17 years
and know that Memorial Sloan Kettering Cancer Center can be an oasis
of treatments that work, but only for
patients who, perhaps motivated by
advertising, go for diagnosis and
treatment. Anticancer hospital advertising may be the most beneficial advertising on earth.
RONALD N. LEVY
New York
Mr. Salerno points out that the
branding and advertising campaigns
of for-profit cancer-care centers fail
to highlight rates of cure and survival. The point of advertising is to
attract all patients—a patient whose
treatment fails generates as much or
even more profit than one who recovers. Outcome is unlikely to vary between one licensed and regulated
treatment center and another. Therefore the conventional language of advertising is used in hope of attracting
a larger market share for reasons unrelated to truth or treatment.
PHILIPPA GORDON, M.D., FAAP
Brooklyn, N.Y.
Mr. Salerno fails to address the issue of whether cancer survival rates
differ between institutions. A 2015
study published by the California
Health Care Foundation found an “association between low hospital surgery volume and higher mortality and
complication rates” for 11 different
types of cancers. Clearly, in this case,
where a patient gets treatment does
make a difference in survival.
ROB TUFEL, MSW, MPH
Executive Director
Cancer CAREpoint
San Jose, Calif.
U.S. Dredgers Are Doing What They Should
Nancy McLernon claims U.S. dredgers stifle competition in the seaport
industry, kill jobs (including union
jobs) and she asserts Savannah’s
deepening and expansion project is
experiencing cost overruns and is behind schedule (“Protecting U.S.
Dredgers Kills Jobs,” op-ed, April 17).
She doesn’t provide any data to back
up the claims.
The U.S.-flagged dredging fleet totals more than 400 dredges. In 2017
the private-sector U.S.-flagged hopper
dredging fleet capacity increased by
34% with the addition of two large
new-build vessels built in U.S. shipyards by U.S. workers. The U.S.
dredging industry continues to spend
billions of dollars recapitalizing its
operations.
Currently, the U.S. dredging industry is amid a $1 billion-plus capital
construction shipbuilding program.
New investments include four large
ISTOCK/GETTY IMAGES
Y
REVIEW & OUTLOOK
cutter suction dredges, two large
hopper dredges and approximately 50
barges built in shipyards all across
the U.S. Vessels are under construction and more capital construction
projects will be announced shortly.
The U.S. dredging industry is
highly competitive with more than 50
different companies awarded federal
work each year and 80 different companies bidding on that work annually.
U.S. industry regularly works with
the Army Corps of Engineers, seaports, states and the environmental
Holman Jenkins’s “The Post Office
community to make sure project exeand Trump’s Culture War” (Business
cution is safer, more efficient and
World, April 21) addresses part of the more productive, while minimizing
problem with the USPS, those being
project impacts.
congressional interference and union
The Savannah Harbor Deepening
“negotiated” personnel costs. What is Expansion Project is a shining beacon
missing is the impact of the actual
of American ingenuity. According to
costs of business-related activities on the Army Corps of Engineers, Savathe Post Office. A normal one-ounce,
nah’s outer-harbor deepening project
first-class letter now costs 50 cents to finished “in March ahead of schedule
mail, even within the same ZIP Code.
and under budget.” This included the
At the same time, bulk-rate mail,
careful recovery of the Civil War
without regard to weight, goes cross- ironclad ship CSS Georgia from the
country for a fraction of that cost.
Savannah River.
My mail box receives about 60
WILLIAM P. DOYLE
CEO & Executive Director
pounds of recyclable catalogs and
Dredging Contractors of America
other unsolicited stuff each month.
Washington
The impact of junk mail creates a significant demand for vehicles to transport the stuff from post office to
mailboxes and an increase in the
number of carriers and other personnel to handle and deliver the materials. Properly priced, the bulk mail
THE WALL STREET JOURNAL
would either go away, reducing the
personnel and equipment demands on
the post office, or actually pay for the
services used. In the end that would
reduce the subsidy from my tax dollars and reduce my cost for recycling
the junk. Sounds like a win-win to me.
JACK HAMILTON
Silverdale, Wash.
More Realistic Bulk-Mail
Pricing Would Help USPS
Pepper ...
And Salt
Letters intended for publication should
be addressed to: The Editor, 1211 Avenue
of the Americas, New York, NY 10036,
or emailed to wsj.ltrs@wsj.com. Please
include your city and state. All letters
are subject to editing, and unpublished
letters can be neither acknowledged nor
returned.
“But everyone else is going
to Gomorrah for spring break, Dad.”
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | A17
OPINION
Worry About the Trade Deficit—a Bit
T
here is a case for being
concerned—though only
modestly—about the U.S.
trade deficit. The principal
villain in this story is not
China, Europe or Mexico, but the U.S.
itself. Getting that narrative wrong,
however, is leading Washington toward policies to reduce the trade deficit that will be somewhere between
irrelevant and counterproductive. Simultaneously, the U.S. is pursuing
domestic policies that will boost the
trade deficit even further.
The U.S. trade deficit has been
stable for nearly a decade at about
3% of gross domestic product. That’s
partly offset by net income that
Americans earn on their investments
abroad, leading to a current-account
deficit of about 2.5% of GDP.
The danger is that the U.S.
borrows too much money
from foreigners. Balancing
the budget would help.
There are sound arguments that a
deficit of this magnitude is nothing
to worry about. Adam Smith taught
that what’s really valuable to a country is imports. Exports are merely
the unpleasant effort undertaken to
get them. Moreover, as long as the
Federal Reserve has room to cut interest rates if needed, the trade deficit doesn’t cost jobs. Any additional
demand that came from reducing the
trade deficit would be offset by the
Fed as it raises rates. Do a quick
global survey: It isn’t as if the unemployment rate is lower in countries
like Italy that have trade surpluses
than in countries like the United
Kingdom that have large trade
deficits.
Nevertheless, the flip side of
the current-account deficit is the
large amount of foreign borrowing the U.S. needs to undertake
every year. America has been
borrowing from abroad since the
1970s, and its net obligations to
the rest of the world now stand
at 40% of GDP. Having the U.S.
dollar as the world’s reserve currency—what economists sometimes call America’s “exorbitant
privilege”—allows the U.S. to
borrow relatively cheaply, while
Americans invest some of the
proceeds in higher-return projects overseas. So far the U.S. is
still making money, on net, from
its international position. But no
one knows how long that will
last—and regardless, America
would be making even more At the Port of Long Beach, Calif., April 4, 2018.
money if it didn’t owe foreigners
so much debt.
current-account deficit does not rise shrinking the volume of trade without
Future rates of return are unpre- much above about 3% of GDP.
altering the net balance.
dictable, but aging is guaranteed. ToBut how? Even the best-executed
The reality is that a basic accountday there are 4.2 working-age Ameri- trade policy will have little effect on ing identity holds: The current-accans for each one 65 or older. By the trade deficit. Tariffs? Empirical count deficit is the gap between total
2040 that will fall to 2.9. Partly as a evidence shows no relationship with investment and total savings. If a
result of these demographic trends, trade balances. Argentina has a large country saves less money than it puts
most forecasts now expect the econ- trade deficit despite its high tariffs, toward things like factories and
omy to grow only about 2% a year. while Germany has a large trade sur- equipment, it has to finance the difGiven all this, borrowing substantial plus despite its low tariffs.
ference with foreign borrowing. Ultisums from abroad to fund spending
What about curbing unfair trade mately, current-account flows and fitoday may be unwise, since it will re- practices by China and other coun- nancial flows must match. America’s
quire—all else equal—cutting back on tries? That would boost U.S. exports net imports of cars, oil, clothing and
spending in the future.
in some specific industries—but it other goods are matched by net exThis is why the International Mon- would also drive up the dollar, hurting ports of government debt, corporate
etary Fund has recommended that other exports and increasing imports. debt and so forth.
the U.S. cut its current-account defi- The net effect on the overall trade
For now U.S. investment as a share
cit roughly in half. That would mean deficit would be imperceptible, though of the economy seems likely to rise.
reducing the annual trade deficit by it might change some of the bilateral It’s bouncing back from the postcrisis
about 1% of GDP, or $200 billion. This balances. How about a trade war? overhang. Higher oil prices are drivmay be more aggressive than war- That would do even less to reduce the ing momentum in the oil-and-gas inranted, but at a minimum the U.S. trade deficit. Higher U.S. and foreign dustry. And the 2017 tax law modshould endeavor to make sure the tariffs would cancel each other out, estly increases incentives to invest.
All told, it would be reasonable
to expect investment to rise by
about 1% of GDP over the next
few years.
At the same time, the federal budget deficit, a form of
negative savings, is expected to
increase by about 2% of GDP
over the next year, with about
half of that due to the tax cuts.
All else equal, this would increase the current-account deficit by 3% of GDP, which translates to an additional $600
billion in the annual trade deficit. (In reality, increased private savings will likely offset
some of the effect.)
What would be a better
course? First, pursuing trade
enforcement and liberalization
in a multilateral fashion. That
would not affect the trade balance, but it would expand the
volume of both exports (helping support more higher-paid
jobs) and imports (benefiting consumers). Then to prevent the trade
deficit from growing, the U.S.
should increase national savings.
One way to boost private savings
would be to expand retirement-savings options for workers who do
not have them, a policy that would
have the added benefit of helping
American families prepare better
for old age. Cutting the federal budget deficit would directly boost national savings even more. If the U.S.
is serious about making progress
toward a more sustainable international position, the solution is to
stop blaming others and start examining ourselves.
TIM RUE/BLOOMBERG NEWS
By Jason Furman
Mr. Furman, a professor of practice
at the Harvard Kennedy School, was
chairman of the White House Council
of Economic Advisers, 2013-17.
Bill Cosby Couldn’t Pull the Race Card—Unlike O.J. Simpson
Twenty-three years
after the O.J. Simpson acquittal, another black man
whose celebrity transcended race has
been tried for crimes
UPWARD
MOBILITY against a white
woman. In this case,
By Jason L.
too, the evidence of
Riley
guilt seems overwhelming. But unlike
the O.J. case, this one has not been
derailed by racial controversy. Does
Bill Cosby’s conviction represent
some measure of racial progress?
In 1995, to the astonishment of
millions, Mr. Simpson beat a doublemurder rap. Last week, Mr. Cosby
was convicted of sexual assault. The
Simpson trial, which lasted nearly a
year, could not have been more racially polarizing. News of the ex-football player’s acquittal prompted
cheers among many blacks, even
those who thought he was guilty of
killing his former wife and her friend.
The Simpson case sparked endless
chatter about policing, jury nullification and the criminal justice system’s
treatment of black men.
Today those discussions continue—in part because social media
increases the visibility of everything
from a police shooting to a trespassing incident at Starbucks—but they
seem to have had little impact on
how the Cosby case played out. Nor
did blacks circle the wagons as so
many had around Mr. Simpson. Here
and there, you’ll find someone who
believes the comedian was the victim
of some racist conspiracy. But most
people, of all races, believe that justice finally was served.
When Mr. Cosby played the race
card in interviews, it was dismissed
as an act of desperation. And when
his publicist went on television after
last week’s verdict and compared
Mr. Cosby to Emmett Till, the black
teen who was murdered and disfigured in Mississippi in 1955 after being accused of flirting with a white
woman, people cringed.
The political left is boasting that
the #MeToo movement convicted
Mr. Cosby, but the jurors say it was
the accuser’s credibility and Mr.
Cosby’s own words in a deposition.
“Mr. Cosby admitted to giving these
Quaaludes to women, young
women, in order to have sex,” said
one of the jurors, Harrison Snyder,
on “Good Morning America.” Mr. Snyder added that he’d never even heard
of the #MeToo movement until he
read the media coverage after the
trial.
If Mr. Snyder is being truthful,
this is progress. Our criminal-justice
system ought to be making decisions
based on evidence, not historical
wrongs or social-movement zeitgeist.
Still, there were likely wider social
Is this some measure of
progress? Maybe. But black
leaders long ago wrote the
comedian off as an ‘elitist.’
factors at play that explain why
blacks in general, and many black
elites in particular, reacted to this
case very differently than to Mr.
Simpson’s more than two decades
ago.
Since the mid-2000s, Mr. Cosby
has made more headlines for his social conservatism than for his comedy. In 2004, he was the featured
speaker at a black-tie event in Washington that marked the golden anniversary of the Supreme Court’s
Brown v. Board of Education ruling.
Mr. Cosby was being honored for his
education philanthropy, and according to his biographer, Mark Whitaker,
the organizers had expected him say
some words of thanks and tell a few
jokes to close out the evening.
Instead, the comedian used his allotted time to fume about fatherless
homes, the school achievement gap,
black crime rates and civil-rights
leaders, who he said spent too much
time making excuses for these outcomes. His larger point was that
many blacks today were not taking
advantage of opportunities created
by a previous generation of civilrights trailblazers.
“These people, they opened the
doors,” he said, pointing to surviving lawyers and activists from the
Brown case in attendance. “They
gave us the right, and today, in our
cities and public schools we have
50% dropout rates. In our own
neighborhoods, we have men in
prison. No longer is a person embarrassed because they’re pregnant
without a husband. No longer is a
boy considered an embarrassment if
he tries to run away from being the
father of a child.”
After going on at some length in
this fashion, Mr. Whitaker writes,
“Cosby left the stage, to applause
and cheers, but also more than a
few stunned expressions in the
crowd.” In the weeks, months and
years to follow, Mr. Cosby would
face a furious blowback—especially
from black intellectuals and activists. Jesse Jackson, Al Sharpton and
the National Association for the Advancement of Colored People took
issue with his comments. Michael
Eric Dyson, a black academic, accused the entertainer of advancing
“classist, elitist viewpoints . . . that
only reinforce suspicions about
black humanity.” Ta-Nehisi Coates
called him “the patron saint of black
elitists.”
Mr. Cosby refused to apologize or
back down, taking his message of
personal responsibility to black
churches and inner-city schools and
prisons. But he would never recover
his reputation as a genial jokester. If
O.J. Simpson benefited from racial
tribalism, Bill Cosby was on his
own. Well before the epic hypocrisy
and myriad accusations of his reprehensible behavior toward women
become widely known, Mr. Cosby
was on the outs with conventional
black thought leaders. They convicted him a long time ago.
The Deep State Weaponizes Vetting of Trump Appointees
By Sean M. Bigley
N
othing ends a Washington career like being branded an
unacceptable national-security risk. That’s why officials adjudicating personnel-security cases
must act in a mature, objective and
nonpartisan fashion. But when it
comes to vetting Trump appointees,
they often aren’t. Instead, security
clearances are being weaponized
against the White House by hostile
career bureaucrats, thwarting the
president’s agenda by holding up or
blocking appointees.
Consider the case of Adam
Lovinger. Mr. Lovinger is a highly regarded and politically conservative
Defense Department official. In January 2017, the Trump administration
made a “by name” request for him
to serve as a senior director on the
White House National Security
Council.
Before departing the Pentagon
that January, Mr. Lovinger raised
documented concerns with his supervisor about the misuse of contractors. One outfit, run by a
woman Chelsea Clinton describes
as her “best friend,” was being
used to perform foreign-relations
activities on behalf of the U.S. Mr.
Lovinger, an attorney, perceived the
arrangement as violating a federal
law delineating inherently governmental functions. He also took issue
with millions of dollars in public
funds being spent on contractor
studies of questionable relevance.
One taxpayer-funded study sought
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to determine whether Americans
are a “war-like people.”
Months after Mr. Lovinger raised
these issues, the Pentagon suspended
his security clearance and his White
House detail was canceled without
warning. The reason? Specious, and
constantly evolving, claims of misconduct. One of Mr. Lovinger’s alleged transgressions was that Pentagon officials had improperly marked
an academic report he took aboard
an airplane for reading.
The father of three, his family’s
primary breadwinner, remains on administrative leave. The same official
who suspended Mr. Lovinger’s security clearance is now moving to cut
off his pay while the allegations are
under review. Amplifying due-process concerns, the panel rendering
Notable & Quotable
Alex Tabarrok writing at
MarginalRevolution.com, April 16:
What could be more ours than
our friends? Yet I have hundreds of
friends on Facebook, most of whom
I don’t know well and have never
met. But my Facebook friends are
friends. We share common interests
and, most of the time, I’m happy to
see what they are thinking and doing and I’m pleased when they show
interest in what I’m up to. If, before
Facebook existed, I had been asked
to list “my friends,” I would have
had a hard time naming ten friends,
let alone hundreds. My Facebook
friends didn’t exist before Facebook.
My Facebook friendships are not
simply my data—they are a unique
co-creation of myself, my friends,
and, yes, Facebook.
the final decision reports to the official who suspended him. She refuses
to recuse herself or her subordinates
despite a conflict of interest.
Meanwhile, Pentagon officials ignored a longstanding executive order
requiring they provide the accused
Unaccountable Pentagon
officials block a security
clearance for a would-be
White House aide.
with the government’s evidence
within 30 days. This forced Mr.
Lovinger to respond blindly to vague
allegations, then contend with bureaucrats claiming he did not adequately rebut documents he has
never seen. Pentagon officials underscored their contempt for anyone
who challenges them by leaking
false, defamatory information about
Mr. Lovinger.
Mr. Lovinger’s lifeline is that his
case, although symptomatic of a political agenda, is fundamentally one
of whistle-blower reprisal. That affords him legal tools and remedies—
including an inspector general investigation and potential monetary
damages—that other Trump appointees, victims of similarly abusive
practices, can’t access.
As an attorney who defends security-clearance holders, including
Mr. Lovinger, I have had a frontrow seat to behavior that only a
year ago I would have dismissed as
a conspiracy theory. Across the federal government, what was long an
apolitical process with clearly defined standards has devolved to the
point that wildly unfounded accusations are now being used to smear
reputations and settle petty vendettas. And it all occurs in closeddoor proceedings not appealable to
the courts. Failure to stop these
abuses risks undermining the integrity of the entire personnel-security
system.
In Mr. Lovinger’s case, those
weaponizing the security-clearance
process include a senior official who
remains on the job despite publicly
disparaging President Trump as
“unfit” to lead, a Pentagon attorney
who instructed colleagues on the
importance of concealing retaliatory
motives behind their actions, and
the Defense Department’s security
adjudications chief, who persists in
advancing false allegations.
They and other unelected partisans are quietly usurping presidential prerogatives through a litany of
seemingly small but slowly compounding abuses of bureaucratic
power. Their efforts evidence a philosophy that laws and rules are not
static boundaries of societal norms,
but flexible tools of the administrative state.
It is imperative that federalagency heads and inspectors general
step in to stop the power grab, lest
those targeting Mr. Lovinger and
others like him believe themselves
immune to accountability. Failure to
act decisively will mean not only
the continued destruction of lives
and careers, but also a precipitous
dwindling of the pool of patriots
willing to subject themselves to
such abuses.
Mr. Bigley is a national-security
attorney and a partner at Bigley Ranish LLP.
.
THE WALL STREET JOURNAL.
A18 | Wednesday, May 2, 2018
WORLD NEWS
Iraq’s Shiite-Sunni Schism Loses Its Bite
Campaign for elections
this month shows
former sectarian foes
forming new alliances
Campaign posters for Iraq’s May 12 elections lining a road in Fallujah, where streets were still full of rubble last year after the bitter battle to expel Islamic State.
New Unity Is Partly
Another Legacy
Of Islamic State
FALK NIELSEN/NURPHOTO/ZUMA PRESS
FALLUJAH, Iraq—The highway to this western Iraqi city,
long synonymous with Sunni
resistance against Iraq’s Shiiteled government, now showcases signs the sectarian tensions that have ravaged the
country for 15 years are ebbing.
The road to Fallujah is dotted with posters promoting
Sunni candidates as part of
Shiite-dominated coalitions for
this month’s national election.
Many of the same politicians
who stirred up animosity now
speak of unity, as they court
voters fed up with years of
sectarian politics that culminated in Islamic State’s takeover of a third of the country.
“We are really exhausted
and don’t care who rules us,
as long as we can lead a normal life,” said 23-year-old Fallujah shop owner Muhammad
Saoud.
Candidates for Iraq’s parliament aren’t blind to that attitude. Sunni politician Mohammed Yaseen’s Iraqi Islamic
Party was a driving force behind the Sunni protest movement in 2013 that was ultimately hijacked by Islamic
State. Now he is running in
Fallujah as an ally of Shiite
Prime Minister Haider alAbadi, who last week became
the first Iraqi leader in 15
years to campaign in what has
been essentially enemy territory for the government.
“Past experience has proved
to our people that Iraqis should
be united,” Mr. Yaseen said.
Iraqi politics has played
along sectarian lines since the
U.S. invaded the country and
unseated dictator Saddam
Hussein in 2003. That effectively empowered the Shiite
majority through the ballot
box, a new order rejected by
Sunnis, who felt they lost out.
That political schism led to
years of violence and governing dysfunction, eventually
fueling Islamic State’s success.
Four years later, the utter
devastation visited on Islamic
AHMAD AL-RUBAYE/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY ISABEL COLES
AND ALI NABHAN
State-occupied Sunni areas has
ended any meaningful resistance to the political order
that took shape after 2003.
Sunni politicians who at first
trumpeted Islamic State’s conquest as a revolution against
the Shiite-led government
have lost credibility among
those who endured extreme
violence and privation under
militant rule.
The message ahead of next
week’s election, from both
Sunni and Shiite politicians, is
one of solidarity. Electoral
groupings headed by Shiite
parties expect to win more
seats in Sunni areas than ever
before. And some Sunni politicians who were forced to flee
the country when sectarian
tensions were at their height
have rejoined the political
mainstream.
“The Sunnis have come to
terms with the fact they are
merely an accessory to
power,” said prominent Sunni
politician Mishaan al-Jubbouri. “They are completely
crushed.”
Gulf Arab states that previously sponsored Sunni efforts
to change the status quo in
Baghdad are now pursuing a
different approach to Iraq.
Saudi Arabia and its allies are
engaging moderate Shiite politicians such as Mr. Abadi in a
bid to pull Iraq out of Iran’s
sphere of influence.
That has pushed most Sunni
politicians in Iraq to realign
themselves with Baghdad.
Mr. Abadi has capitalized
on the shift by striking a conciliatory note and promoting a
national identity, broadening
his appeal beyond his own Shiite Arab constituency. His socalled Victory electoral list is
the only one to field candidates in all 18 of Iraq’s governorates, and polls project it
will win a significant number
of seats from Sunnis.
“Iraq appeared divided and
partitioned, and was pushed
towards becoming ethnic and
sectarian cantons…but we
have turned that page,” Mr.
Abadi said last week at his
historic campaign stop in Fallujah. “In victory we achieved
unity.”
In the city of Fallujah, many
civilians trying to rebuild their
lives after three years of war
and displacement blame their
own Sunni politicians as much
as the government in Baghdad
for leading them to ruin.
“They abandoned us and
left when Daesh came,” said
Muhammad Saoud, a young
Fallujah shop owner, using a
common derogatory term for
Islamic State.
Memories of the militants’
reign of terror are everywhere.
A traffic roundabout in the city
center, now the site of an election billboard, is where Islamic
State publicly executed its opponents; a five-story building,
now covered with campaign
posters, is where the militants
pushed men accused of homosexuality to their deaths.
Moderating the sectarian
tension is the realization
among Sunnis here that they
largely have the Shiites who
make up the bulk of Iraq’s se-
curity forces to thank for freeing them from Islamic State.
When Iraq’s predominately Shiite forces entered Sunni areas
occupied by the militants,
Sunni politicians warned of a
sectarian bloodbath, but it
never materialized.
Now Sunni politicians have
been forced into a more pragmatic stance. Some are even
running on an electoral list representing Shiite militias who
were accused of most of the
abuses that did take place in
the course of their battle
against Islamic State.
“[Sunni politicians] are kissing the hands of whoever has
influence,” said Hameed Muhammad Mikhlif, 51, at a camp
for displaced persons near Fallujah. “Now it’s about who’s
strong and who’s weak.”
Good relations with the
government are also essential
for Sunnis seeking funds to rebuild. Iraq’s allies have pledged
around $30 billion in loans and
credit to Baghdad—a mere
fraction of the more than $80
billion the government says it
needs to fix the damage done
by Islamic State.
—Isabel Coles
Armenia’s Opposition Leader, Blocked in Bid to Become Premier, Calls for Nationwide Strike
GLEB GARANICH/REUTERS
Armenian lawmakers voted
down opposition leader Nikol Pashinyan’s bid to become prime
minister, ensuring a continued
standoff between the ruling
party and a protest movement
that has mobilized around him.
In a country firmly in Russia’s
orbit, Mr. Pashinyan has been
careful to emphasize Moscow’s
role as Armenia’s strategic partner and its continued participation in Moscow-led economic
and military alliances.
But his defeat in parliament
on Tuesday cements a confrontation between the ruling Republic Party, which voted him
down with a majority of the
votes, and the thousands of protesters he has organized in recent weeks.
Following his parliamentary
loss, he called on protesters to
engage in a nationwide strike
starting early Wednesday.
“The airport, railway and all
intercity and intrarepublic roads
will be blocked,” he said, according to Russian news agency Interfax.
Tens of thousands of people
from Armenia’s working and
professional classes have congregated in the center of the
capital Yerevan, left, angered by
the perceived arrogance of the
ruling elite and chronic economic
problems.
Mr. Pashinyan had been the
only candidate for the vote organized in a special parliamentary session. His failure to win
the post means acting Prime
Minister Karen Karapetyan, a
former executive of Russian gas
exporter Gazprom, will remain in
power.
“[The people] will have their
victory nonetheless. You won’t
stop it,” Mr. Pashinyan said after
the vote, Interfax reported.
The protesters, from across
the country included elements of
the military, whose prolonged
rallies in Yerevan last month
forced Prime Minister Serzh
Sargsyan to step down.
The protests began after Mr.
Sargsyan, who had been president for 10 years, announced his
intention to run as prime minister, a post that has been greatly
empowered following a constitutional referendum in 2015.
—Thomas Grove
BY PAUL VIEIRA
AND FRANCIS X. ROCCA
OTTAWA—Canadian lawmakers voted overwhelmingly
to request a formal apology
from Pope Francis for the Catholic Church’s role in the forced
schooling and assimilation of
indigenous children that took
place starting in the 1880s and
lasted for roughly a century.
The motion, which passed
269 to 10 on Tuesday, marks a
rare case of a national legislature making a demand of the
pope. Parliament voted on the
motion weeks after the Canadian Conference of Catholic
Bishops informed indigenous
leaders that Pope Francis
“could not” issue a formal
apology to the survivors of
Canada’s so-called residential
schools.
Neither the Holy See’s em-
bassy in Ottawa nor the Canadian Conference of Catholic
Bishops responded to a request to comment about the
outcome of the vote.
Young aboriginal children
were forcibly taken from their
homes and schooled in churchrun boarding schools. Many
students went hungry, and
some were subjected to physical and sexual abuse, according to a six-year inquiry into
the government-funded practice that called it “cultural
genocide.” Among the more
than 90 recommendations the
inquiry issued in 2015 was to
obtain an apology from the
pope.
The motion voted on Tuesday was introduced by Charlie
Angus, a lawmaker from the
country’s left-leaning New
Democratic Party, and it “invites” Pope Francis to issue a
VINCENZO PINTO/AGENCE FRANCE-PRESSE/GETTY IMAGES
Canada Seeks Apology From Pope Over Indigenous Schools Debt Danger
A bishops’ group said the pope
couldn’t meet the request.
formal apology for the role of
the Catholic Church in “the establishment, operations and
abuses in Canadian residential
schools.” Roughly 16 out of 70
Catholic dioceses in Canada
helped run such schools.
“We are calling on the pope
to walk with us on this road to
reconciliation,” Mr. Angus said.
In March, the Canadian
Conference of Catholic Bishops
said Pope Francis, while unable to issue an apology, “encouraged the bishops to continue to engage in an intensive
pastoral work of reconciliation, healing and solidarity
with the indigenous peoples
and to collaborate in concrete
projects aimed at improving
the condition” of Canada’s native population.
Further, the Canadian bishops said that in 1991 they issued a statement saying they
were “sorry and deeply regret”
the pain suffered by those who
attended residential schools.
They added the Holy See was
“never involved in running the
former [residential] schools.”
Canada’s then-prime minister, Stephen Harper, issued a
landmark apology to the boarding-school students in 2008.
In parliamentary debate
last week, Canada’s aboriginal
affairs minister, Carolyn Bennett, said residential schools
were about “killing the Indian
in the child.” In voting for the
motion, she cited previous papal apologies, such as in 2010
when Pope Benedict XVI apologized to Irish victims of sexual abuse; and in 2015, when
Pope Francis apologized in Bolivia to the indigenous peoples
of the Americas for the grave
sins of colonialism.
“The Catholic Church was
on the right side of history,”
Ms. Bennett said.
Prime Minister Justin
Trudeau has made reconciliation with the country’s indigenous people a priority during
his administration, and he
voted in favor of the motion.
Will Grow,
Poloz Warns
BY KIM MACKRAEL
OTTAWA—Bank of Canada
Gov. Stephen Poloz warned
that household debt poses
growing risks to financial stability and the economy.
Speaking in the Northwest
Territories on Tuesday, Mr.
Poloz said the bank had been
watching debt levels closely.
“We know that a portion of
Canadian households are carrying large debts, and the concern will become larger for
them as interest rates rise,” he
said.
Canadians owe an average
of 170% of their disposable income, up sharply from 20
years ago, Mr. Poloz said.
.
PERSONAL TECHNOLOGY: THE PROMISE OF VR IS VIRTUALLY HERE B4
BUSINESS & FINANCE
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Chinese Unicorns Rush Out IPOs
BY JULIE STEINBERG
AND LIZA LIN
A wave of Chinese technology companies are accelerating
plans to raise money from the
global capital markets, hoping
to leverage investor optimism
about the sector and lock in
buoyant stock valuations.
In recent months, at least a
dozen Chinese companies
with collective private
valuations of roughly
$500 billion have
been in talks with
bankers and potential investors
about
initial
public offerings
in the second
half of this year
or in early 2019,
according to people familiar with
the discussions.
If all those deals
go ahead, at least $50
billion worth of new
shares could hit stock markets,
shaping up as a test of investor
appetite for China’s expanding
internet consumer economy.
Companies typically sell 10% to
20% of their shares when they
go public.
The rush to list reflects a
shift from last year, when many
of the world’s most valuable
technology unicorns—private
companies with valuations exceeding $1 billion—had little
need or desire to tap the capiPlease see IPO page B2
A handful of Chinese technology offerings expected this year
will dwarf the largest on record so far.
Recent or targeted valuations of Chinese tech companies
that may go public over the next year
Top 10 technology IPOs
globally, by amount
raised, with venue
Tencent Music
$25B
Meituan-Dianping
$60B
FRANKFURT/
NEW YORK
Didi Chuxing
Facebook
2012
U.S. EXCHANGES
$16B
TOKYO
$5.9B
Japan Display
2014
$3.1B
EUROPE
Alibaba Group
2014
$25 billion
Worldpay Group
2015
Agere Systems
2001
Xiaomi
$100B
Alibaba
$168 billion
$200B
$3.8B
$4.1B
London
World
Online Intl.
2000
First Data
2015
$80B
Infineon
Technologies
2000
Snap
2017
$2.8B
$3.9B
Amsterdam
150
Ant Financial
T-Online Intl.
2000
$150B
$2.8B
100
Germany
$2.8B
50
Annual Chinese tech and internet
IPOs by market value at offering
2000
’05
’10
’15
’18 so far
Sources: Dealogic (IPOs); staff reports (valuations)
Over the next year
THE WALL STREET JOURNAL.
Tesla Feels Drag From Home-Solar Business
Tesla Inc. has another financial worry: Its home solarpanel business is facing slowing installations and could be
on the hook for financial
promises it made to some investors, just as the U.S. tax
law presents new risks to the
industry.
SolarCity, which the electric-car maker bought in 2016,
is undergoing a sweeping sales
revamp that reduced the number of panels the company installed last year. Now, investors and analysts say they are
scrutinizing guarantees on investment returns and other
promises the company made
to firms that helped finance
SolarCity’s business before the
revamp, and are wondering
whether Tesla will have to inject cash into those deals.
Sanford C. Bernstein & Co.
analysts recently cited SolarCity as one of three main risks
for Tesla, alongside production woes of its first massmarket car and slow customer
adoption of electric vehicles.
INSIDE
CAR SALES
SLIDE SLOWLY
INTO SUMMER
AUTOS, B2
VODKA MAKER
HOPES LESS
WILL SELL MORE
MARKETING, B8
MICHAEL NAGLE/BLOOMBERG NEWS
By Susan Pulliam,
Tim Higgins
and Ianthe Jeanne
Dugan
SolarCity, which Tesla bought in 2016, faces slowing installations and investment-guarantee issues.
“SolarCity could struggle in
migrating to a sales and loan
model, or defaults could increase, triggering high cash
needs,” they told clients.
Tesla, in its recent annual
filing, warned that the new tax
law could be a disincentive for
investors to fund renewableenergy projects. Tesla emphasized the entire solar industry
is affected by the changes.
Tesla declined to break out
financial results beyond saying
the solar business generated
positive cash flow for the
company last year and that it
has helped boost interest in its
Powerwall and Powerpack energy-storage batteries, two
other products that, along
with SolarCity, make up Tesla
Energy Operations Inc.
“Regardless of whatever
misinformation critics happen
to be pushing this week, we
are building the world’s first
vertically integrated sustainable energy company, and solar
is an important part of that effort,” Tesla said in a statement.
“Far from being a cash burden
for Tesla, our solar business
was actually cash flow positive
in 2017, and we expect that
trend to continue in 2018.”
Tesla has little room for
any problems at SolarCity. The
company’s debt swelled to $10
billion partly due to its SolarCity acquisition. It also had
negative cash flow of about $1
billion on average each quarter last year, in part because
of investing for the new Model
3 sedan. Tesla missed a crucial
production goal for the massmarket car last quarter, adding pressure to crank out
enough vehicles to generate
cash this year.
The company is set to report first-quarter financial results on Wednesday.
When Tesla proposed to acquire SolarCity in mid-2016,
the solar business had less
than $150 million in cash at
the end of that year’s second
quarter. Tesla Chief Executive
Elon Musk was SolarCity’s
chairman and a shareholder at
the time. SolarCity ended up
losing more than $800 million
that year and had more than
$3 billion in debt.
Since the merger, SolarCity
has switched to selling customers solar panels in Tesla
showrooms, rather than leasing them door-to-door. The
leases required SolarCity to fiPlease see SOLAR page B5
HEARD ON THE STREET | By Stephen Wilmot
Want to Buy the Next Google? Be Careful
Everyone
can be a venture capitalist.
It is a seductive idea, conjuring up a
rarefied world of Silicon Valley billionaires seeding the
next Amazon.com or Airbnb.
But “equity crowdfunding”
opportunities have yet to
prove their value to investors.
Equity crowdfunding websites aggregate business
pitches and offer individual
investors a slice. The U.S.
market is nascent, only
launching fully in May 2016,
when new rules took effect
as part of the 2012 Jumpstart Our Business Startups
(JOBS) Act. Last year, small
investors committed $49.2
million through platforms
such as Wefunder, up from
$27.6 million in 2016.
There is a more established track record in the
U.K., where equity crowdfunding has existed since
2011. It raised roughly $300
million in the country last
year, mainly for the youngest
startups. Unfortunately,
though, figuring out how investments perform is more
slippery than it should be.
Measuring the returns
from unlisted equity investments is necessarily fraught
with methodological problems. Investors only really
know how much they have
made when startups “exit”
by selling to a larger group
or through an IPO, or else
when they go bust. Most
crowdfunded companies are
in neither category.
Of 955 U.K. equity crowdfunding rounds conducted by
late 2016, five had exited and
216 had raised money at a
higher valuation, according
to data provider AltFi Data.
At the other end of the spectrum, 167 had gone bust or
looked on the edge, and a
further 34 had raised money
at a lower valuation. The majority—533—were somewhere between these two
poles, making their performance difficult to assess
from the outside. Valuing
Jury's Out
Status of 955 equity crowdfunding deals conducted in U.K.
from 2011 through June 2016
Failure
Warning Signs
Downround*
Steady
Upround*
Exit
0 deals 200
400
*lower/higher valuation in subsequent
fundraising
Source: AltFi Data
THE WALL STREET JOURNAL.
these 533 at parity, AltFi
Data estimated the sector’s
internal rate of return to
date at 8.55%.
Frustratingly, U.K. crowdfunding websites haven’t
helped shed light on the
problem. Seedrs, one of the
two largest U.K. platforms,
said the IRR on the 375 deals
it promoted through September 2016 was 14.4%. But the
devil may be in the detail:
This average was based on
an equal weighting of investments, whereas a previous
figure reported by the platform weighted investments
by deal size.
Changes of methodology
hardly inspire confidence.
Nor does the absence of
more recent data. Seedrs told
Heard on the Street in early
January it would update the
performance data toward the
end of that month, but the
report has yet to appear; the
company said it was prioritizing other projects. The
other big U.K. platform,
Crowdcube, declined to give
an up-to-date IRR number.
AltFi Data hasn’t updated its
research due to “inconsistent
support from platforms for
third-party measurement of
performance to a consistent
standard.”
It is easy to get excited
about buying into the Google
of tomorrow. But the opaque
performance record of equity
crowdfunding platforms in
the U.K., amid feverish competition to host deals, suggests investors should approach the burgeoning U.S.
industry with caution.
See more at WSJMarkets.com
Xerox CEO
Resigns in
Pact With
Investors;
Fuji at Risk
BY DAVID BENOIT
Xerox Corp. said its chief executive, Jeff Jacobson, is resigning in a settlement with
two of the company’s biggest
investors, Carl Icahn and Darwin Deason, a pact that shakes
up the majority of the board
and puts its transaction with
Fujifilm Holdings Corp. at risk.
The new board, whose majority is backed by the activists, is expected to consider alternatives to the deal with
Fujifilm, a complex transaction
that sells the majority of Xerox
to the Japanese company by
combining with a joint venture
the two operate in Asia.
Messrs. Icahn and Deason
have been seeking to kill that
deal, saying it undervalues Xerox and had alleged Mr. Jacobson quickly negotiated the
transaction in an attempt to
save his own job after his
board had instructed him to
stop the talks. Xerox has acknowledged it launched a CEO
search last year.
Xerox chose to settle with
the activists after a judge last
week temporarily blocked the
Fujifilm transaction, siding
with Mr. Deason in a lawsuit
and saying the talks were conflicted by Mr. Jacobson’s tenuous position. Seeking a settlement would avoid a distracting
fight over its board and uncertainty about the future of the
deal, Xerox’s existing board
said Tuesday.
The settlement effectively
ends a legal fight with Xerox
and its investors as well as a
potential proxy fight that
would have sought to remove
Please see XEROX page B8
Wall
Street
Stalwart
Heads for
Nashville
BY SARAH KROUSE
One of the oldest names on
Wall Street is moving to one of
the fastest-growing cities in the
South, reinforcing a recent shift
in finance jobs to cheaper parts
of the U.S.
AllianceBernstein Holding
LP plans to relocate its headquarters, chief executive and
most of its New York staff to
Nashville, Tenn., in an attempt to
cut costs, according to people familiar with the matter. That
largely ends a 51-year presence
in the nation’s traditional finance capital.
The move by the money-management giant is part of a broad
cost-cutting effort within a firm
that for years has been under extreme pressure from the rising
popularity of index-tracking
funds and low-cost investing.
In a memo to employees, AllianceBernstein cited lower state,
city and property taxes compared with the New York metropolitan area as among the reasons for the relocation.
Nashville’s affordable cost of living, shorter commutes and ability to draw talent were other
factors.
Other money managers have
also relocated staff to smaller,
lower-wage cities that are
emerging as unlikely hives of finance. Pacific Investment Management Co. plans to open a
new office in Austin, Texas, later
this year as part of a push to
hire more tech-savvy workers,
The Wall Street Journal reported
last month. Denver, meanwhile,
has been host to a growing number of Charles Schwab Corp.
and Fidelity Investments emPlease see MOVE page B2
.
B2 | Wednesday, May 2, 2018
THE WALL STREET JOURNAL.
* ****
INDEX TO BUSINESSES
BUSINESS & FINANCE
These indexes cite notable references to most parent companies and businesspeople
in today’s edition. Articles on regional page inserts aren’t cited in these indexes.
O-P
Fujifilm Holdings........B1
C-D
Carlyle Group............B12
CBL & Associates.......B7
Celgene......................B14
Charles Schwab .......... B1
Citigroup....................B12
Coinbase....................B13
Comcast.......................B3
Cooley........................A10
Crown Resorts............B7
CSX............................B14
Diageo ......................... B8
Dick's Sporting GoodsB8
Didi Chuxing Tech.......B2
E-F
eBay.............................B6
eHarmony....................B4
Facebook................B4,B5
Fiat Chrysler...............B2
Fidelity Investments..B1
Ford Motor..................B2
G-H
General Motors...........B2
Gibson Brands.............B3
Gibson Guitars..........B14
Gilead Sciences.........B14
Goldman Sachs..B12,B13
Google.........................A1
Green Street...............A2
Grocon.........................B7
Halliburton................B14
Hasbro.........................B3
HSBC Holdings............B7
I
IAC/InterActiveCorp...B4
inDinero.......................A1
International Paper .. B14
JPMorgan Chase.......B12
Juno Therapeutics....B14
K
Kite Pharma..............B14
KKR..............................B3
KLX..............................B3
Kroger..........................B8
L-M
Lantern Capital...........B3
Lendlease....................B7
LinkedIn.......................B6
LSB Industries..........B14
Lufax............................B2
Match Group...............B4
McDonald's................B13
Meituan-Dianping.......B2
Melody Capital............B3
Meow Mix.................A10
Merck.................B13,B14
MetLife......................B12
Mirvac Group .............. B6
Morningstar................B7
N
Norfolk Southern......B14
Novartis.....................B14
1Malaysia Development
...................................B12
Pacific Investment
Management.............B1
PetroSaudi International
...................................B12
Pfizer............B5,B13,B14
Ping An Insurance
(Group) of China ...... B2
PolyOne.....................B14
PPG Industries..........B14
PricewaterhouseCoopers
.....................................B7
Q-S
Qutoutiao....................B2
Related........................B7
Rio Tinto ................... B13
Royal Dutch Shell.....B13
Saia............................B14
Scentre Group........B6,B7
Sears Holdings............B7
Shire..........................B14
Silver Point Capital....B3
Snap.............................B5
SoftBank Group..........B2
SolarCity......................B1
T-V
Takeda Pharma.........B14
Tapestry .................... B13
Tencent Music.............B2
Tesla............................B1
Time Warner...............B3
Toys R Us....................B7
Visa..............................B7
Vista Outdoor.............B8
W-X
Walmart......................B8
Washington Prime......B7
Weinstein....................B3
Westfield.....................B6
Xerox ........................... B1
Xiaomi.........................B2
INDEX TO PEOPLE
A-C
J-K
Albanese, Thomas....B13
Bernstein, Seth...........B2
Blake, Aretha............A10
Conroy, Joe ............... A10
Cook, Tim....................A2
Jackson, Mike.............B2
Jacobson, Jeff.............B1
Ji, Richard...................B2
Jones, Andrew............B6
Juszkiewicz, Henry
............................. B3,B14
Kai, Fang ..................... B2
Keegan, Robert...........B8
Klein, Trevor ............. A10
Kossar, Robert............B7
Kraus, Peter................B2
D-F
D'Amelio, Frank..........B5
Davidson, Erik...........B13
Darwin Deason...........B1
Deck, Rob....................B7
Elliott, Guy................B13
Finkelstein, Sydney..A10
Fox, William................B2
Frazier, Kenneth ....... B14
G-H-I
Gensler, Gary............B13
Ginsberg, Mandy.........B4
Grimstone, Gerry......B12
Gupta, Tarun...............B7
Hele, John.................B12
Hubbard, Lawson........B7
Icahn, Carl...................B1
L-M
Lee, Kewsong............B12
Leon, Richard..............B3
Levin, Joey..................B4
MacKenzie, Grant.......B6
Maestri, Luca..............A2
Mah, Jessica...............A1
McCallion, John ........ B12
McFarlane, John........B12
McInerney, John ......... B7
Metz, Chris ................. B8
Mills, Jeff..................B13
Morton, Donald.........B14
Musk, Elon..................B1
R-S
Rajappa, Subadra......B13
Read, Ian..............B5,B14
Rhee, James.............A10
Rosenstein, Rod ......... A4
Saban, Haim................B3
Saitta, Alfredo..........B12
Schaefer, David...........B6
Sears, John.................B6
Sherman, Dan...........B14
Spiegel, Evan .............. B5
Squali, Youssef...........B5
Stein, Eric ................. B13
T-V-Z
Tilton, Lynn...............B12
Tusar, Greg................B13
Visentin, John.............B1
Weinstein, Harvey......B3
Wilkinson, Chris ......... B7
Zuckerberg, Mark ....... B4
Sedan Weakness Dents Auto Sales
BY ADRIENNE ROBERTS
Auto sales slowed in April
amid a continued decline in
demand for sedans and compact cars, setting a somber
tone as auto makers head into
the important summer selling
season.
Deliveries likely slipped
more than 5% during the
month compared with the
same period in 2017, according
analyst estimates, partially because there were two fewer
selling days this April. Rising
oil prices and tougher credit
conditions are also creating
concern for auto executives
hoping to maintain a selling
pace near the record levels set
in recent years.
Sport-utility vehicles and
pickup trucks continue to perform well amid relatively low
fuel prices. But regular gasoline surpassed an average of
$2.80 a gallon nationally this
week, 18% higher than a year
earlier and 6% higher than the
prior month, according to the
U.S. Energy Information Administration. Prices are expected to rise and could top
$3 a gallon through the summer driving season.
Slightly higher pump prices
aren’t leading consumers to
more efficient cars, however,
and lower interest in cars such
as the Ford Fusion is pulling
down the broader market.
Sales of SUVs and pickup
trucks are estimated to account for 67% of new-vehicle
retail sales in April, the highest level ever for the month,
according to research firm J.D.
Power. Auto makers, realizing
this switch in consumer preference is likely here to stay,
are beginning to back away
from sedans.
Ford Motor Co. said last
BILL PUGLIANO/GETTY IMAGES
A-B
AEW Asia....................B6
Airbnb..........................B1
Alibaba Group.............B2
AllianceBernstein
Holding......................B1
Alphabet.........A1,A10,B5
Amazon.com..........B1,B6
APN Funds
Management.............B6
Apple .............. A1,B6,B14
Aqualand Projects ...... B7
Ashley Stewart ........ A10
AT&T............................B3
AutoNation ................. B2
AXA.............................B2
Barclays.....................B12
BlackRock...............B6,B8
Blackstone Group ....... B6
Boeing ......................... B3
BP................................B3
Brookfield Property....B6
Fiat Chrysler’s sales rose in April on the back of strong performance of its Jeep-brand vehicles.
Monthly Vehicle Sales Over the Past Year
Ford
April
Toyota
FCA
s5%
t9.2%
203,856
192,348
184,149
125,701
Note: Percentage change is from April 2017
QILAI SHEN/BLOOMBERG NEWS
Gloria Liu, a partner at law
firm DLA Piper in Hong Kong,
said several Chinese private
companies have become dominant players in their industries
after merging with or acquiring
other tech firms. Going public,
she added, “is the natural next
step.”
Other Chinese tech unicorns
MOVE
87,764
pala big sedan in the next few
years, according to people familiar with the matter.
Mike Jackson, chief executive of AutoNation Inc., the
biggest U.S. dealership chain,
said Tuesday the fuel economy
of SUVs “has improved dramatically” and American consumers prefer the high seating
position that SUVs and trucks
offer. That means gasoline
prices have a long way to rise
before customer behavior
changes. “Even if gas prices go
a bit higher it’s not really go-
ing to change that dynamic,”
Mr. Jackson said.
Ford reported a 4.5% decline in April, selling 203,856
vehicles during the month.
GM is no longer reporting
monthly sales, moving to disclose the numbers on a quarterly basis.
Fiat Chrysler Automobiles
NV was the only auto maker to
report a sales increase, because of strong sales of the
company’s Jeep-brand vehicles. It said sales rose 5% in
April to 184,149.
Services Group—now in the
middle of a $9 billion fundraising round—is widely expected
to follow. Some of the larger
companies are already profitable.
Several firms are seeking a
listing in Hong Kong, where
regulatory changes also encourage more initial share sales.
A recent move by that exchange to allow companies
with two classes of voting stock
to list is “a big game-changer,”
said Richard Ji, chief investment officer at Hong-Kong
based All-Stars Investment
Ltd., allowing tech entrepreneurs to keep control of their
companies and list them in a
market close to home.
China recently said it would
allow overseas incorporated
companies to list on the mainland by issuing depositary receipts, or contracts that give
domestic investors interests in
their shares.
Some younger and smaller
companies are also working on
IPO plans. News app Qutoutiao
plans an offering in the U.S.
later this year, according to
people familiar with the matter.
It could value the startup at $4
billion, one of the people said.
NIO, an electric-car maker
based in Shanghai, is discussing selling a chunk of its IPO
shares to Japan’s SoftBank
Group when the startup goes
public in New York in the second half of the year, the Journal has reported.
U.S. investment banks are
trying to get in on the potential
IPO bonanza. Some U.S.-based
bankers have spent more time
in China in recent months,
courting companies and pitching them on going public, according to people familiar with
their movements. Some banks in
Hong Kong have been bulking
up their teams of tech bankers.
Kai Fang, managing director
at investment bank China Renaissance, said bankers on his
team may work as many as 100
hours some weeks to handle
the increased workload created
by companies considering IPOs
and investors looking to buy
stakes.
—Stella Yifan Xie
contributed to this article.
Updated Legal Notice
If You Bought or Leased a New Vehicle, or Bought Certain
Replacement Parts for a Vehicle Since 1995
HELEN COME/THE DAILY NEWS JOURNAL/ASSOCIATED PRESS
Continued from the prior page
ployees.
Wall Street’s migration began
after the last financial crisis as
banks and money managers
looked to trim expenses or take
advantage of lower tax rates.
Hiring in lower-cost regions can
mean millions of dollars in annual savings.
A new tax plan passed last
year by Congress also reduced
tax breaks that many in the New
York region heavily lean on, such
as the deductibility of mortgage
interest and state and local tax
deductions.
Tennessee “is low cost in every respect compared to New
York” including housing and
transportation, said William Fox,
an economist and director of the
University of Tennessee’s Boyd
Center for Business and Economic Research.
The firm has deep roots in
New York. Sanford C. Bernstein
got its start in the city in 1967
and grew into a well-known
value-oriented money manager
known for investment research
before it was bought by Alliance
Capital in 2000.
AllianceBernstein,
which
manages $550 billion in assets,
considered as many as 30 cities
as part of its search, according
to part of an internal memo seen
by the Journal, and analyzed
factors such as housing, education, weather and cost of living.
The money-management giant notified staff Tuesday, the
people said, and plans to begin
shifting employees to the south-
working on IPO plans include
smartphone maker Xiaomi
Corp., music-streaming company Tencent Music Entertainment Group and online
lender Lufax, which is backed
by Chinese financial giant Ping
An Insurance. Jack Ma’s financial technology giant and Alibaba affiliate Ant Financial
t28%
THE WALL STREET JOURNAL.
Source: the companies
week it will shift $7 billion in
spending away from small cars
and sedans and redeploy it to
developing more higher-margin trucks and SUVs. It will
only sell the Mustang and a
crossover version of the compact Focus in the U.S. in the
near future, aiming to eventually have 90% of its sales volume in SUVs and trucks.
General Motors Co. will
end production of the Chevrolet Sonic subcompact as early
as this year and is considering
discontinuing the Chevy Im-
Smartphone maker Xiaomi is planning an IPO. One of its products is unveiled in Shanghai.
That platform, Meituan-Dianping, has a large online food
review and delivery services
business and plans an IPO—targeting a $60 billion market valuation—according to people familiar with the matter. Didi is
aiming for at least $70 billion
to $80 billion, the Journal previously reported.
Nissan
t4.7%
IPO
Continued from the prior page
tal markets because they were
flush with cash and had abundant private fundraising options.
Several factors are at play,
including a loosening of listing
rules in China and Hong Kong,
intensifying competition in
China’s mobile and internet industries, rising stock valuations
and shareholder pressure.
“It’s a herd mentality,” said
Rocky Lee, a partner at law
firm King & Wood Mallesons
who advises Chinese tech
founders. “If a competitor of
yours decides to list, you have
to consider listing.”
Chinese ride-hailing giant
Didi Chuxing Technology Co.
in recent weeks has sped up
talks about the possibility of
going public, The Wall Street
Journal reported last week, after a large Chinese online-services platform earlier this year
started offering competing
ride-hailing services.
Honda
t4.5%
You Could Get Money From Settlements Totaling Approximately
$1.04 Billion
The city’s lower cost of living was a factor in the decision.
ern city later this year. Its money
managers and private client
business will remain in New
York, while most other functions
and the firm’s top leaders including Chief Executive Seth
Bernstein shift to the new headquarters.
The Wall Street Journal reported in October that the firm
was in talks to shift some staff
out of New York and that it considered locations including Charlotte, N.C., and San Antonio,
where it already has an office.
AllianceBernstein said the
shift was unlikely to improve the
firm’s margin until 2020, according to a shareholder letter by
Chairman Robert Zoellick and
the CEO, Mr. Bernstein, published in the firm’s annual report. It has 3,466 employees
globally, according to that report.
The Nashville decision follows
a tumultuous year for the company in which its former chief
executive, Peter Kraus, and most
of its board were ousted by parent insurer AXA SA. The firm
was also hard hit by the 2008 financial crisis when bad bets on
financial stocks hurt its performance.
The growth of low-cost indextracking funds and greater fee
sensitivity among investors has
put unprecedented pressure on
money managers, prompting
many firms to slash fees and cut
expenses to remain competitive.
Since Mr. Kraus’s ouster a
year ago, Mr. Bernstein has been
charged with cutting costs and
continuing to revitalize the firm.
Revenue in the first quarter rose
13% to $867.8 million, while operating income rose 34% to
$222.7 million.
—Cameron McWhirter
contributed to this article.
Fifty-six defendant groups and their affiliates
have agreed to Settlements resolving claims
that they fixed the price of certain vehicle
components. This may have caused individuals
and businesses to pay more for certain new
vehicles and replacement parts. These Settling
Defendants deny any claims of wrongdoing.
Maine, Massachusetts, Michigan, Minnesota,
Mississippi, Missouri, Montana, Nebraska,
Nevada, New Hampshire, New Mexico, New
York, North Carolina, North Dakota, Oregon,
Rhode Island, South Carolina, South Dakota,
Tennessee, Utah, Vermont, West Virginia, and
Wisconsin.
Am I included?
You may be included if, from 1995 to 2018,
you: (1) bought or leased a qualifying new
vehicle in the U.S. (not for resale) or (2)
bought a qualifying vehicle replacement part
(not for resale) from someone other than the
manufacturer of the part. In general, qualifying
vehicles include four-wheeled passenger
automobiles, cars, light trucks, pickup trucks,
crossovers, vans, mini-vans, and sport utility
vehicles. Visit the website or call for a full
list of Settling Defendants and applicable
time periods and to determine whether you
are included.
How can I get a payment?
You must submit a Claim Form online or by
mail. There is no deadline yet to submit a claim.
If you already filed a claim, you do not need
to submit another claim for the same vehicle or
part. You can get a Claim Form at the website
or by calling the toll-free number below. At
this time, it is unknown how much each Class
member who submits a valid claim will receive.
Payments will be based on the proposed Plan of
Allocation (available at the website).
What do the Settlements provide?
The Settlements, totaling $432,823,040, are
being presented to the Court for approval. The
Court previously approved settlements totaling
$604,069,618. The Settlement Funds (minus
expenses, attorney fees, and other costs) will
be used to pay consumers and businesses in
30 states and the District of Columbia. The
Settlements also include non-monetary relief,
including cooperation, and agreements by
certain Settling Defendants not to engage in
certain conduct for a period of 24 months.
What are my rights?
Even if you do nothing, you will be bound by
the Court’s decisions. If you want to keep your
right to sue, you must exclude yourself by July
13, 2018. If you do not exclude yourself, you
may object to one or more of the Settlements
applicable to the Settlement Class in which you
remain by July 13, 2018. Visit the website for
important information.
The Court will hold a hearing on August
1, 2018 to consider whether to approve the
Settlements. Settlement Class Counsel may
also request reimbursement of costs and
expenses as well as attorneys’ fees of up to
25% of the Settlement Funds (minus costs and
The 30 states are: Arizona, Arkansas, expenses). You or your own lawyer may appear
California, Florida, Hawaii, Iowa, Kansas, and speak at the hearing at your own expense.
For More Info or to File a Claim: 1-877-940-5043 www.AutoPartsClass.com
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | B3
BUSINESS & FINANCE
Lantern
Nears Deal
To Acquire
Weinstein
Possible Paths to an AT&T Ruling
With trial over, judge
plans June decision
on whether to allow
the Time Warner deal
BY JONATHAN RANDLES
BY BRENT KENDALL
Dallas-based private-equity
firm Lantern Capital Partners
topped the bidding for the film
and television studio cofounded by Harvey Weinstein
and is close to acquiring the
business, according to people
familiar with the matter.
Weinstein Co. named Lantern the lead bidder with a
$310 million offer when the
entertainment company filed
for chapter 11 bankruptcy protection in March. No other potential buyers topped Lantern’s
existing offer, one of these
people said. The deadline for
bids was the close of business
Monday.
Any sale of Weinstein Co.
assets must be approved by a
bankruptcy judge and could be
challenged by the studio’s
creditors. Five women who
have accused the studio in a
proposed class-action lawsuit
of concealing Harvey Weinstein’s alleged misconduct said
Tuesday that the proposed
sale to Lantern would leave
victims
“empty-handed.”
Women who have pending legal claims against the studio
are classified as unsecured
creditors in the bankruptcy.
Elizabeth Fegan, a lawyer
representing these women,
said in a statement that Lantern’s bid “would sweep the
100+ instances of sexual assault, rape and more under the
rug.”
Mr. Weinstein has admitted
mistakes but denied allegations of nonconsensual sex.
Current and former members
of the Weinstein Co. board
have denied they were aware
of Mr. Weinstein’s alleged misconduct.
“Victims have already
shown they will no longer be
silenced, and we intend to protect them from being further
harmed,” Ms. Fegan said.
WASHINGTON—The sixweek trial over AT&T Inc.’s
planned acquisition of Time
Warner Inc. ended Monday,
and a ruling will be announced
on June 12. Here is the range
of possible outcomes.
AT&T and Time Warner
have two paths to full victory.
The first is straightforward:
U.S. District Judge Richard
Leon could find that the proposed $85 billion transaction
is unlikely to lead to higher
prices or reduced options for
consumers.
The Justice Department argues that AT&T’s ownership of
Time Warner’s television programming would spur small
but significant price increases
in consumers’ monthly bills,
which added together across
all U.S. pay-TV subscribers
would amount to hundreds of
millions of dollars a year.
The companies say those
calculations overestimate a
number of factors, and that
when those estimates are corrected, the analysis shows
consumers saving money.
AT&T and Time Warner appeared to make headway during the trial in attacking the
government’s estimates.
The second path is more
complicated. The companies
argue that even if the Justice
Department were right about
small price increases, those increases would be outweighed
by the transaction’s benefits,
including billions in cost savings and new product offerings from the combined company. Courts, however, have
been cool to the idea that cost
savings and other benefits can
save a deal that raises concerns about competition.
The Justice Department has
three arguments against the
deal, and any could in theory
deliver a victory. The department spent most of the trial
on its primary claim: that
AT&T, which owns the DirecTV
satellite service, could use
Time Warner’s Turner Networks as leverage to demand
that rival pay-TV providers
pay more for those channels.
If rivals pay more, then consumers ultimately will as well,
the department argues.
Separately, the Justice Department says a postdeal
AT&T could act in tandem
with another dominant industry player, Comcast Corp., to
stifle competition and innovation. It also contends that
AT&T could use Time Warner’s
HBO as a weapon by limiting
how rivals can distribute the
popular premium network.
If Judge Leon agrees with
any of those arguments, he
could find the deal violates
federal antitrust law.
The companies’ merger
agreement is set to expire
June 21. The timing of Judge
Leon’s ruling, slated for June
12, gives the losing party a
small window to seek a stay of
his decision.
If AT&T wins and a higher
court doesn’t stay the effect of
Judge Leon’s ruling, the companies would be free to close
their transaction, though the
department could continue to
press an appeal even after the
deal is finalized.
If AT&T and Time Warner
lose at trial, they could mount
an appeal of their own. They
would have to extend their
merger agreement.
BP’s Grueling Recovery Gathers Momentum
BY SARAH KENT
LONDON—BP PLC shares
rose to levels not seen since
shortly after the Deepwater
Horizon disaster in 2010, as
rebounding oil prices led to
solid first-quarter results.
Like other big oil firms that
have reported recently, London-based BP benefited from
recently lofty oil prices, but it
also showed rising production.
The outcome was its strongest
quarterly earnings since
mid-2014—which could go
some way toward convincing
investors that BP’s ambitious
plan to regain its position
among the world’s top energy
companies is gaining steam.
BP’s shares rose 1.8% to
£5.48, or about $7.50, in London trading on Tuesday.
The stock hit a two-year
high of £6.58 on April 21,
2010, the day after the Deepwater Horizon explosion,
which killed 11 and sent oil
spewing into the Gulf of Mexico, resulting in the worst offshore oil spill in U.S. history.
Once investors realized the
scale of the disaster, BP shares
hurtled lower, hitting a low of
£2.96 in June 2010.
Then-Chief Executive Tony
Hayward resigned the following month, and BP started
what would turn out to be a
multiyear, multibillion-dollar
effort to recover. To pay for
cleanup costs and legal fees, BP
was forced to sell off billions of
dollars in assets, dramatically
shrinking the size of the company. To date, the spill has cost
BP more than $65 billion.
The company agreed to a
landmark $20 billion deal to
settle all federal and state
claims for the accident in
2015. Since then, executives,
including current chief Bob
Dudley, have tried to turn the
page on the disaster. Part of
that effort has been a plan to
return its oil-and-gas production to four million barrels a
day, while boosting profits and
cash flow.
The company said Tuesday
its replacement cost profit—a
number analogous to the net
income that U.S. oil companies
report—was $2.4 billion in the
first quarter, compared with
$1.4 billion in the same period
a year earlier. The last time it
reported profit of that size
was in the third quarter of
2014, when oil prices were
Bouncing Back
BP shares are trading at their highest level for eight years.
BP’s weekly share price
£7
2
1
3
4
6
5
7
6
5
4
3
2010
’11
’12
’13
’14
1 April 20, 2010: The Deepwater
Horizon oil rig explodes
2 June 25, 2010: BP shares hit low
as costs mount
3 July 27, 2010: CEO Tony
Hayward resigns
4 Nov. 15, 2012: Agrees to pay
$4.5 billion in criminal settlement
’15
’17
’18
5 Sept. 4, 2014: Found grossly
negligent in the incident,
threatening new fines
6 July 2, 2015: Reaches $20 billion
deal to settle all outstanding
federal and state claims
7 May 1, 2018: Reports best
quarter since 2014
THE WALL STREET JOURNAL.
Sources: FactSet (price); staff reports (events)
hovering near $100 a barrel.
In addition to its Deepwater
Horizon woes, BP suffered
with the rest of the industry
’16
through years of low oil prices.
Oil prices fell to about $25 a
barrel in 2016, before rebounding. International crude is now
BUSINESS WATCH
trading near $75 a barrel.
The company’s first-quarter
production rose 6% from a
year earlier. BP started a record number of projects
around the world last year and
intends to initiate six more in
2018, part of a plan to add
900,000 barrels a day of new
production by 2021. That
would return output to near
its pre-Deepwater Horizon levels of roughly four million barrels a day. On Tuesday, it said
it pumped 3.7 million barrels a
day in the first quarter.
BP finance chief Brian Gilvary raised the prospect that
the company would consider
raising its dividend in the second half of the year as it expects debt levels to subside.
But BP still hasn’t escaped
the financial liabilities of the
Deepwater Horizon disaster.
The company said it paid out
$1.6 billion in the first quarter,
including the final installment
from a settlement with the
U.S. Justice Department. For
the full year, payments are expected to total just over $3
billion. The company faces
charges of about $2 billion
next year, and then more than
$1 billion a year out past 2030.
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Rock ’n’ roll pioneer Chuck Berry was among stars who patronized prestigious Gibson Brands.
BOEING
Boeing Co. said it would buy
plane-parts specialist KLX Inc.
for $3.2 billion, its biggest acquisition in almost 20 years and
part of a push for a bigger slice
of the lucrative aircraft-servicing
business.
The world’s No. 1 plane maker
said it would pay $63 a share
for KLX and take on about $1
billion in debt. The Wall Street
Journal previously reported Boeing was close to clinching the
deal amid competition, including
from at least one private-equity
firm, after KLX said in December
it had initiated a sales process.
Boeing has accelerated its
deal-making efforts over the
past 18 months, buying autonomous-systems specialist Aurora
Flight Sciences Corp. last year
and taking minority stakes in a
number of small startups.
—Doug Cameron
and Robert Wall
Berry and Jimmy Page, filed for
bankruptcy protection Tuesday
with a deal to hand control of
the company, which has struggled with its debt load after a
series of soured acquisitions, to
bondholders led by private-equity giant KKR & Co.
The Nashville, Tenn.-based
musical-instrument maker,
founded in 1894, said the filing
was prompted by looming debt
maturities and the unsuccessful
2014 acquisition of Philips’s consumer-electronics business, in
papers filed in U.S. Bankruptcy
Court in Wilmington, Del.
Under a restructuring pact
filed with Gibson’s chapter 11
bankruptcy petition, a group of
bondholders—among them
funds managed by KKR & Co.,
Silver Point Capital LP and
Melody Capital Partners LP—
will take control of Gibson’s
musical-instrument business.
Gibson is owned by Chief Executive Henry Juszkiewicz and
David Berryman, who acquired
Gibson in 1986.
—Becky Yerak
GIBSON BRANDS
HASBRO
Guitar Maker
Singin’ the Blues
Toy Maker Buys
Power Rangers
Storied guitar maker Gibson
Brands Inc., whose customers
have included B.B. King, Chuck
Hasbro Inc. is buying television-based toy brand Power
Rangers and other entertain-
Plane Maker in Deal
For Parts Specialist
ment properties in a cash-andstock deal valued at roughly
$500 million.
The acquisition extends a
business relationship between
Hasbro Chief Executive Brian
Goldner and close friend and
mentor Haim Saban, the billionaire creator of the Power Rangers. Earlier this year, Hasbro acquired the rights to make Power
Ranger action figures and other
toys starting in 2019.
Hasbro is also taking over
other Saban Brands properties,
including My Pet Monster, Popples, Julius Jr., Luna Petunia and
Treehouse Detectives. Mr. Saban
will work with Hasbro as a consultant.
—Paul Ziobro
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The Board of Directors of Canadian
National Railway Company has declared
a quarterly dividend of CDN$0.455 per
share on the outstanding common
shares. The quarterly dividend is
payable on June 29, 2018 to
shareholders of record at the close
of business on June 8, 2018.
By order of the Board
Sean Finn
Executive Vice-President
Corporate Services and
Chief Legal Officer
Montreal, Quebec
April 23, 2018
www.cn.ca
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B4 | Wednesday, May 2, 2018
THE WALL STREET JOURNAL.
NY
TECHNOLOGY
WSJ.com/Tech
PERSONAL TECHNOLOGY | By David Pierce
VR Device Takes Large Step Forward
BY DEEPA SEETHARAMAN
AND GEORGIA WELLS
EMILY PRAPUOLENIS/THE WALL STREET JOURNAL
I spent last
Saturday night
in my very
own movie
theater. It
seats a hundred, but nobody else was
there. Technically, I wasn’t
even there: I was lying on my
couch staring toward the ceiling, wearing a virtual-reality
headset. I spent the night
binge-watching “The Office”
on an enormous screen nobody else could see.
As VR experiences the
same ups and downs of any
other “Is it the future?” invention, the technology itself
is evolving fast: HTC recently
released the new and hugely
improved Vive Pro, while Microsoft and its partners rolled
out a handful of Windowsbased VR headsets. Google’s
partnership with Lenovo will
soon yield the $400 Mirage
Solo. And this week we meet
the $200 Oculus Go, Facebook’s second—and this time
far more affordable—headset.
The promise of VR is simple: You can leave this world
without leaving the couch. If
the world adopts VR, there
are massive, society-shaping
implications that are both
cool and scary—just ask anyone who saw “Ready Player
One.”
VR isn’t ready for that yet,
but in testing the Oculus Go, I
found it is a surprisingly large
step in the right direction. It’s
really the first of its kind: an
affordable, simple and powerful way to explore virtual reality.
Right now, VR kits come in
three tiers. HTC’s Vive Pro
represents the technology’s
bleeding edge, with a supersharp screen and a tracking
system that can follow you
around a room. It also costs
more than $1,000 to get
started—not including the
$2,000-plus gaming PC it requires. At the opposite end
are the Samsung Gear VR and
Google Daydream View—sim-
Facebook’s Oculus Go is really the first of its kind: an affordable, simple and powerful way to explore virtual reality.
ple, cheap docks for your
smartphone.
I
n the middle, a new kind
of headset is finally appearing. Devices like the
Oculus Go and Mirage Solo
don’t need a PC and don’t
steal your phone. They have
no cables. They can’t play intense games, but they’re great
for casual use. And with web
browsers and video players,
they satisfy needs that border
on the practical.
I’ve spent the past few
weeks trying most of the current headsets, with a particular focus on the Oculus Go. I
played games and watched
videos, but I also tried shopping, working and traveling
the world in VR.
The Go reminds me of my
first Amazon Echo. I owned
better speakers, but I gravitated to the Echo because asking Alexa to play a song was
so easy. Similarly, the Go is so
simple I found myself using it
more than the bigger, better
headsets. The Go makes VR
feel less like an event you
have to schedule and more
like just picking up your
phone. There are dozens of
simple, smartphone-style
look-and-tap games.
Y
ou can also do a lot of
looking around, which
is more fun than it
sounds. Watch 360-degree
videos from Facebook. Watch
Netflix or Hulu on a screen
that appears far larger than
your flat screen.
The technology makes it
possible to “hang out” in a
more intimate and real-feeling
way than a phone call or
video chat. I like the premise,
and was impressed by a demo
of Oculus Rooms, where you
join up with your friends to
play games or watch videos.
VR developers are starting
to integrate everyday activities like web browsing. But
the Oculus Go’s screen isn’t
sharp enough to read on comfortably for very long. And
while pointing a controller at
floating letters is novel, someone needs to invent faster VR
typing.
Yes, the Go lacks crucial
features. It doesn’t have controllers that track and mimic
your hand motion. Instead,
the Go uses a simple remote,
similar to what you get with
Nintendo’s Wii consoles. The
Go also can’t track your location in space: It turns with
your head, but it won’t follow
if you lean down or walk
around—which are things that
make VR feel truly real.
Oculus has shown off a
prototype of a stand-alone device that has both motion
tracking and more powerful
hand-like controllers. And
HTC is working on a similar
stand-alone headset called the
Focus. Both devices, which
will likely cost more than
$200, take the right approach:
The headset you and I both
want is wireless, but has powerful controllers and the
tracking capabilities to follow
users around the room.
The headset you want
probably has one other thing:
augmented reality. Rather
than remove you completely
from the real world, an AR
headset layers the virtual over
the real. Instead of watching
TV on a giant screen in a fake
theater, you could plant that
giant screen on the wall in
your actual living room.
It’ll take time before this
technology materializes in an
affordable device we’d actually wear. Meanwhile, a device
like the Oculus Go makes a lot
of sense. Before VR is perfect,
it should at least be easy.
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Facebook Inc. plans to
launch a dating feature on its
platform, even as the socialmedia giant battles questions
about how it handles users’
data and privacy.
Chief Executive Mark Zuckerberg announced the new service Tuesday at an annual developer conference in which he
pledged that Facebook would
continue to innovate while also
addressing challenges related
to its legacy businesses.
The announcement punished
shares of Match Group Inc.,
which with such brands as Tinder, OkCupid and Match.com
dominates the online-dating
market. Match’s share price
dropped 22%, while its majority
owner, IAC/InterActiveCorp,
lost more than 17%. eHarmony,
another big player in online
dating, isn’t publicly traded.
Facebook’s dating feature
will target what Mr. Zuckerberg
said are some 200 million Facebook users who identify as single. The feature will require users to opt in, he said, and was
designed with privacy in mind.
Mr. Zuckerberg didn’t say
whether the service would be
free but Facebook doesn’t offer
any paid products currently.
The competition jabbed at
Facebook on Tuesday, alluding
to the social network’s recent
challenges. “We’re surprised at
the timing given the amount of
personal and sensitive data that
comes with this territory,”
Match Group CEO Mandy Ginsberg said.
“Their product could be
great for U.S.-Russia relationships,” said IAC chief Joey
Levin, in an apparent reference
to the ways Russian actors used
Facebook in an attempt to sow
discord in the U.S. around the
time of the 2016 presidential
election.
.
THE WALL STREET JOURNAL.
NY / NE
Wednesday, May 2, 2018 | B5
SOLAR
Continued from page B1
nance the deals, which it did
using money from outside investors. Selling the panels, by
contrast, means customers either pay cash or take out a loan
to pay for them. Tesla hopes
the new tack will generate
more cash and make it less dependent on outside investors.
But the new strategy has
led to a slowdown in installations, said Allison Mond, a solar analyst at GTM Research,
which expects SolarCity to be
surpassed as the leading residential solar-panel installer
this year. Tesla’s and SolarCity’s shareholder letters indicate a 38% decline in the
megawatts of solar panels deployed in 2017.
If SolarCity can’t generate
enough business, it might not
be able to deliver promised investment returns to funds it
created before the Tesla deal.
Some investors can claim tax
benefits based off the company’s losses, and Tesla could
be forced to pay investors out
of its pocket to make good on
its guarantees, analysts say.
A Tesla spokeswoman said
it doesn’t provide guaranteed
investor returns but rather indemnifications, which it says
Cloudy Outlook
Tesla’s solar business has
declined as it retools its sales
strategy.
Megawatts of solar energy
generated by systems deployed,
quarterly data
250 MW
200
150
100
50
0
2016
’17
Source: the company
THE WALL STREET JOURNAL.
are typical of the solar industry. Tesla also described the
type of financing it uses as
“nonrecourse,” meaning it is
secured only by collateral.
Therefore,
the
company
wouldn’t have additional liability beyond losing the collateral
in case of default, Tesla said.
At the end of 2016, as Tesla
was beginning to digest SolarCity, the solar company had
arranged $3.9 billion of financing through a type of
fund known as a variable interest entity, according to
2017 filings. These VIEs had
47 investors, including 34 financial institutions. In a recent securities filing, Tesla
said “in some instances” it has
guaranteed payments to investors in the VIEs.
The Tesla spokeswoman
said it now has more than 60
such funds with more than
$6.2 billion in financing. The
company declined to comment
on the specific guarantees beyond saying in an April interview that it no longer guaranteed so-called VIEs.
Tesla also said it had one
particular fund dating to 2011
that had a guarantee but that
has since been bought out.
In its latest annual report,
in February, Tesla also outlined several types of complex
deals made with investors in
which it is responsible for
guarantees, including “lease
pass-throughs” and “saleleasebacks,” two common arrangements used to finance
solar projects.
The company declined to
say why its financial filings
still mention the guarantees.
Another risk has emerged
due to the December change in
the tax law, which lowered
corporate tax rates to 21%
from 35%. Analysts say the
change could hurt SolarCity’s
ability to fund new projects
because it could alter the incentives for investors. A lower
tax rate, when applied to
losses, reduces the amount an
investor can deduct from total
losses. That, in turn, would
lower the investment return.
Tesla said in a recent filing
that the new tax code “could
potentially increase the cost,
and decrease the availability,
of renewable energy financing.”
PAT GREENHOUSE/THE BOSTON GLOBE/GETTY IMAGES
TECHNOLOGY
In the latest quarter, rising sales of newer drugs helped offset falling revenue for longtime products.
Pfizer’s Revenue Stalls
Amid Shift to Newer Drugs
BY JONATHAN D. ROCKOFF
AND CARA LOMBARDO
Pfizer Inc.’s revenue was
little changed in its latest
quarter as the drug company
shifts focus to a new generation of products and sorts out
what to do with its over-thecounter medicines unit, which
hasn’t attracted a buyer.
In the quarter, rising sales
of newer drugs including cancer treatments Ibrance and
Xtandi and blood-thinner Eliquis offset falling revenue for
longtime products such as
male-impotence pill Viagra,
which is facing lower-price generic competition.
But double-digit sales increases for some newer products weren’t enough to move the
needle on the company’s overall
revenue, which rose 1% from a
year earlier to $12.9 billion.
Chief Executive Ian Read
said revenue will grow at a
higher rate as the company
brings to the market drugs under development, including
what he said were 15 compounds each with the potential
for $1 billion in yearly sales.
The drugs will require regulatory approval before hitting
the market. “I’m really looking
forward to the growth rates
we will produce,” Mr. Read
said during a conference call
with analysts and investors.
Both Mr. Read and Chief Financial Officer Frank D’Amelio
played down the possibility of
finding growth by splitting up
The company is still
deciding on the fate
of its over-the-counter
medicines unit.
the company or doing a major
deal, moves for which they
had previously expressed more
support. “I don’t see we need
a transformative deal,” Mr.
Read said during the call.
Pfizer has been exploring
since late last year selling or
spinning off its consumerhealth business, which sells
products such as Advil pain
pills, ChapStick lip balm and
Centrum vitamins.
Analysts had predicted
Pfizer could sell the business
for $10 billion or more. But so
far, potential buyers have
opted to make other deals.
GlaxoSmithKline PLC, which
had been interested in Pfizer’s
business, chose instead to buy
Novartis AG’s share in a joint
venture for $13 billion. Reckitt
Benckiser Group PLC, a U.K.based
consumer-products
maker, pulled out of talks for
Pfizer’s business in March, saying it wasn’t possible to buy
only the parts it wanted. Meantime, Procter & Gamble Co.
agreed to buy Merck KGaA’s
consumer-health business.
Mr. Read said Pfizer will decide by the end of the year what
to do with the consumer-health
business. “If we can’t get good
value, we will retain it,” he said.
In the quarter, Pfizer’s results
were hurt by supply shortages
for some sterile injectable drugs.
Overall, Pfizer reported a firstquarter profit of $3.56 billion,
up from $3.12 billion a year ago.
Snap’s
Results
Fall Below
Estimates
BY GEORGIA WELLS
Snap Inc. said revenue rose
54% in the first quarter from a
year ago, but that missed analyst estimates and fell nearly
20% short of the previous quarter as efforts to wrest a larger
share of advertisers’ budgets
were impeded by Facebook Inc.
and Alphabet Inc.’s Google.
The Venice, Calif.-based
company’s shares fell 16% in
after-hours trading Tuesday.
A recent redesign of the
firm’s Snapchat app apparently failed to reignite the
app’s slowing user growth.
The $230.7 million in revenue
that Snap recorded missed the
forecast of $243 million from
analysts polled by FactSet. Advertisers typically spend more
in the fourth quarter than the
first quarter because of holiday
ramp-ups in November and December, but analysts have said it
is unusual for a company’s revenue to be so seasonal early in its
life as a public company.
“Pretty disappointing,” said
Youssef Squali, an analyst with
SunTrust Robinson Humphrey
Inc. He had expected Snap to
do better in the quarter because advertisers typically
spend more money during the
Olympics, which took place in
February. “They missed on virtually every metric,” he added.
Snapchat added about 4 million daily users during the first
quarter, bringing its total user
base to 191 million. Analysts surveyed by FactSet expected Snap
to add 7 million daily users.
The redesign of the Snapchat
social-media app was aimed at
broadening the firm’s business
beyond teens and young adults.
The first-quarter results offer
the first look at how the redesign affected Snapchat’s growth.
“A change this big to existing
behavior comes with some disruption,” Snap Chief Executive
Evan Spiegel said Tuesday.
.
B6 | Wednesday, May 2, 2018
THE WALL STREET JOURNAL.
INTERNATIONAL PROPERTY REPORT
Australia
Sydney’s Office Market Is Prospering
Developers find new
uses for old buildings
as steady job growth
creates strong demand
Low Vacancy
Offices in Sydney’s central
business district have lately seen
declining vacancies.
10%
BY SHEFALI ANAND
8
6
4
2
0
’10
THE WALL STREET JOURNAL.
The city is having a surge in acquisitions and new developments by big domestic and foreign companies.
eventually come to an end. After years of price increases,
growth in the value of office
buildings is now flattening,
market participants say.
Also the development machine is beginning to stir. New
projects include Barangaroo, a
sprawling master-planned development on former dockland, and 10 Carrington St.,
Brookfield’s 59,000-squaremeter office project tied to the
redevelopment of the Wynyard
commuter rail station.
About 547,000 square
meters was added to Sydney’s
central business district between 2015 and 2017, mostly
due to Barangaroo, according
to Colliers. Another 497,000
square meters is expected to
be delivered between 2018 and
2020, Colliers said.
“The new supply will actually be welcome…as a number
of tenants would not be able to
expand or upgrade office space
in the current tight environment,” said Anneke Thompson,
national director of research at
Colliers in Australia.
Demand for space has been
especially strong from Sydney’s growing service-sector
businesses, including from legal and technology firms such
as Amazon Web Services, Apple Inc. and LinkedIn Corp.
Last year, one of the largest
leases in Sydney was a 17,000square-meter office space on
York Street to set up Sydney
Startup Hub, a project of the
state government to provide
incentives to startups.
Indeed, demand has been so
strong that landlords lately
have been able to cut the value
of incentives they typically offer tenants to sign new leases.
“In Sydney, landlords historically have offered three to
four months of free rent,” said
David Schaefer, managing director of AEW Asia Ltd., a
fund manager that bought two
buildings in the city last year.
“Now it’s one.”
The new space that has
been delivered in Barangaroo
has been leased faster than
many expected. Brookfield’s
Malls Prep for Amazon Invasion
BY MIKE CHERNEY
project next to Wynyard station—scheduled to be completed in 2020—is about 42%
pre-leased to the National Australia Bank for its new headquarters.
“We’re in a very good position,” said Sophie Fallman, a
Brookfield managing partner.
“We’re seeing demand from
other tenants to lease up the
balance of the space as well as
rental growth.”
More than 80 billion Australian dollars (US$60.2 billion) will be spent in the next
four years in New South Wales
for projects including a new
metro rail network and an
over-ground light rail, which
will make it easier and faster
Online sales in Australia last year made up 8.8% of all retail, compared with 11.8% in the U.S.
from some of the pain.
“Australian shopping center
owners and retailers are
watching closely what the impact of Amazon has been
around the world, and they
are acting to cope with that,”
said John Sears, Australia research director at real-estateservices firm Cushman &
Wakefield.
Moreover, key structural
differences between Australian
and U.S. retail also make it unlikely that Australian malls
will struggle as much as their
U.S. counterparts, some say.
Online sales in Australia last
year made up 8.8% of all retail,
compared with 11.8% in the
U.S., according to market-research firm Euromonitor International.
At the same time, Australia
doesn’t suffer from the same
retail space glut as the U.S.,
which has more than 2.5 times
the retail space per capita, according to Cushman & Wakefield.
The battle between bricks
and clicks in Australian retailing mirrors the way it is playing out in developed countries
throughout the world. Increasingly, landlords who are holding their own are those who
are giving shoppers a wide
range of reasons to make the
trip to the mall.
Australian shopping centers
also are in better shape because they have less space devoted to department stores,
which have proved to be vulnerable to online shopping.
APN Funds Management,
which invests in Australian
real-estate investment trusts,
cites figures from Citigroup
Global Markets that show U.S.
shopping centers devoted 46%
of space to department stores,
compared with about 20% in
Australia. Meanwhile, entertainment, restaurant and other
nonretail attractions get 19%
of Australian retail space,
compared with 14% in the U.S.,
according to Citigroup.
“The retail mix of tenants
has changed over the years,”
said Grant MacKenzie, a senior
portfolio manager at Freehold
Investment Management, another Australian fund manager
that invests in property securities. “You’re getting a lot
more entertainment, al fresco
dining and the like.”
The strategy is paying off:
Occupancy rates for major
Australian shopping-center
owners have been “consistently high for many years,”
says Cushman & Wakefield’s
Mr. Sears. Scentre Group,
which runs some of Australia’s
top malls, said its vacancy rate
last year was less than 0.5%.
The rate hasn’t changed from
2014, when Scentre split from
Westfield Corp.
Amazon is still likely to
present some challenges to
traditional landlords. Guaranteeing same-day delivery to
customers in some of Australia’s more remote areas will be
difficult. But Amazon could
still be a threat in the big East
Coast cities like Sydney and
Melbourne, where population
density is comparable with
large U.S. cities, Andrew
Jones, a credit analyst at National Australia Bank, wrote in
a report last year.
Second-tier shopping centers, which may not be big
enough for nonretail attractions, could also be at risk.
to reach the city center. Money
also is being poured into revamping hospitals, schools and
sports stadiums.
Meanwhile, demand for
housing has been strong,
thanks to the country’s robust
economy and investments in
education that have attracted thousands of international students. One-quarter of
the office stock withdrawn
over the past two years was
for residential and mixed-use
redevelopment, according to
real-estate-services firm JLL
Australia.
With supply vanishing,
the average vacancy rate in
Sydney’s central business district fell to its lowest level in
nine years, to 4.6% in January,
according to the Property
Council. This compares with a
vacancy rate of 9% as of January 2014.
Meanwhile, net effective
rents of high-quality office
properties in the central business district jumped 54% in
the past two years through the
end of December, according to
JLL. In comparison, net effective rents grew on average
4.5% a year over the past decade through December, according to JLL.
—Peter Grant
contributed to this article.
Australia’s Boom
In Housing Falters
BY PETER GRANT
BRENDON THORNE/BLOOMBERG NEWS
Two years ago, Australian
shopping-center operator Mirvac Group launched an effort
to help retain customers amid
rising competition from online
retailers: combine a trip to the
mall with a scenic boat ride in
Sydney Harbour.
The Shopper Hopper service has ferried 23,000 customers to two Mirvac malls
along the coast, part of an initiative to persuade shoppers
that a mall visit offers unique
experiences that can’t be
found in front of a computer.
Mirvac had good reason to
beef up its defenses against
online retail competition. In
December, Amazon.com Inc.
launched its full retail website
in Australia and opened its
first warehouse in the country.
Previously, Australians had
to shop on Amazon’s U.S. and
U.K. websites for most products, which meant hefty shipping fees and long delivery
times. Although other big online retailers such as eBay Inc.
have been popular in Australia, up until recently the country’s consumers have been
mostly hooked on bricks-andmortar stores.
Now, Amazon’s full entrance has sparked concerns
that Australian shopping centers face the same carnage
that has undermined many a
retail landlord in countries
that got hit early by the online
shopping juggernaut. Indeed,
shares of Scentre Group Ltd.,
the largest listed retail-property company in Australia,
have been trading at about 4
Australian dollars ($3) recently, down from about
A$5.40 in mid-2016.
But the Shopper Hopper
service and other efforts by
Australian retail landlords to
make trips to the mall more
fun are a sign that they aren’t
going to be a pushover for
Amazon and other online retail companies. Investors and
analysts say mall operators in
Australia have spent the past
few years adding amenities
and remixing tenants to keep
shoppers interested, which
should help insulate them
’15
Note: Average vacancy rates for the
six-month periods ending Jan. 1 and July 1.
Source: Property Council of Australia
STEVEN SAPHORE/REUTERS
Dozens of older office buildings have been taken out of
commission in Sydney to make
way for major transportation
projects, new residential development and office redevelopments, helping to create a bonanza for owners of the
remaining stock.
Rents, occupancy rates and
values have soared as developers and the New South Wales
government have taken out of
commission thousands of
square meters of office space
in Sydney. Around 480,000
square meters (5.2 million
square feet) of office space—or
9.6% of the total in Sydney’s
central business district—have
been withdrawn in the past
three years, according to the
Property Council of Australia,
a trade association.
Another 4.8% of office stock
could be withdrawn by 2021,
estimates Colliers International,
a real-estate consultancy.
The decline in supply has
been coupled with strong demand. Job growth has been
steady in the Australian economy, which hasn’t suffered a
recession for more than 25
years and is benefiting from a
surging population.
These bullish trends have
sparked a surge in acquisitions
and new developments by big
domestic and foreign players.
Market participants include
Blackstone Group LP, a unit of
BlackRock Inc., Brookfield
Property Partners LP and Abu
Dhabi’s sovereign-wealth fund.
“The withdrawals of stock,
married with a strong and
growing economy, has led to
this phenomenal growth,” said
Kevin George, executive general
manager, office and industrial
at Dexus, one of the largest office landlords in Australia.
Of course, all good things
Residential sales volume and
values have started to fall in
many areas of Australia, partly
the result of efforts by lenders
and government regulators to
cool a sizzling pace of transactions. But now a debate is raging
among economists and market
participants about whether the
residential sector is heading for
a soft landing.
In an April report, data firm
CoreLogic noted that housing
values held firm in March because the declines in prices in
Sydney, Melbourne and Adelaide
were offset by price increases in
lower-cost regional markets.
Overall, the Australian housing market is “showing every
sign of recording a soft landing
after national dwelling values
peaked in September last year,”
said Tim Lawless, CoreLogic’s
head of research in the report.
Other forecasters are less
sanguine. “In contrast with others in the market who view the
worst as [being] behind us, we
expect prices to fall further
throughout 2018, as credit availability is tightened further and a
stretched consumer reassesses
the property outlook,” wrote
Morgan Stanley in a report late
last month.
A nervous Australian banking
system is watching the market
closely. The volume of outstanding residential mortgages
crossed the 1.5 trillion Australian
dollar mark (US$1.124 trillion) in
December, 2015, compared with
less than A$400 billion in 2000,
according to Deloitte Australian
Mortgage Report. In 2016, total
new lending, including refinancing, was A$384 billion, the same
as in 2015, the report said.
At the same time, the efforts
by Australian authorities to regulate home values have lessons
for other global markets struggling with issues of affordability
and what appear to be untethered price increases. All of Australia’s five major housing markets are listed as “severely
unaffordable” by research firm
Demographia, which ranks Sydney as the world’s second least
affordable city, trailing only
Hong Kong.
UBS investment bank said in
a September report that Sydney
was one of an increasing number
of world cities facing “bubble
risk.” In those municipalities,
prices have climbed by nearly
50% on average since 2011, compared with other financial centers, where the increase has been
a more moderate 15%.
“This gap is grossly out of
proportion to the differences in
local economic growth and inflation rates,” the UBS report said.
Australia’s housing market
has been driven by the country’s
strong population growth and an
economy that hasn’t been in recession for more than 25 years.
Foreign buyers and Australians
purchasing second and third
homes have stoked demand.
Some analysts and economists began warning of a possible bubble as early as 2009, even
A debate is raging
about whether the
market is heading for
a soft landing.
as much of the world was struggling with the aftermath of the
global financial crisis. But the
market has kept chugging, with
prices rising in practically every
quarter.
In Sydney, the median value
of a house was $1,179,500 in December, while the median price
of an apartment was $737,000,
according to Knight Frank Research.
In an effort to cool the market
in late 2014, the Australian Prudential Regulatory Authority
told banks to cap the growth of
loans to investors. Since then,
regulators and banks have imposed new restrictions, including
limits on interest-only mortgages. Australian states also
have tried to put the brakes on
the housing market by
increasing stamp duties on foreign buyers.
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | B7
INTERNATIONAL PROPERTY REPORT | AUSTRALIA
REITS
Big Landlords Evade
Problems in Retail
Many of the largest U.S. mall
owners have managed to dodge
much of the carnage in the retail
world caused by failing retailers,
according to a report by Moody’s
Investors Service.
Struggling retailers like Sears
Holdings Corp. and Toys “R” Us
Inc. account for 3.9% of the total
leasable space in the 22 retail
real-estate investment trusts
that Moody’s tracks. Only two
REITs, CBL & Associates Properties Inc. and Washington
Prime Group Inc., face an exposure of over 10%, a level
Moody’s deems “significant.”
What’s more, most of the retail REITs continue to maintain
high occupancy rates and rent
space for average rents that are
above the rents in expiring
leases, Moody’s said.
—Peter Grant
INDUSTRIAL SPACE
Demand Rises
In New Jersey
Industrial space in New Jersey is so hot that lease deals
are drying up.
Across the state, which has
become a major logistics hub for
online retailers and other industrial tenants, 5.3 million square
feet of leases were signed in the
first quarter, about 27% less
than the average from 2015 to
2017, according to a report from
real-estate services firm JLL.
The main culprit: a lack of
space. That is reflected in asking
rents, which jumped 12% from
the same quarter a year earlier
to $7.14 a square foot.
Available space is constrained
across the board, but is more
acute for tenants on the hunt
for deals of 500,000 square feet
or more, said Robert Kossar,
head of the Northeast industrial
region for JLL. —Keiko Morris
Project Strives for the Right Mix
Early phase of Sydney’s
Barangaroo is seen
as a success, but
some hurdles remain
BY ISOBEL LEE
Sydney’s Barangaroo project is beginning to shift the
city’s commercial center of
gravity three years after the
first new tower opened in the
city’s biggest-ever urban-renewal project.
The first three skyscrapers
that have opened, offering 3
million square feet of office
space on the 18.5-acre first
phase, have attracted numerous big-name tenants from
traditional business districts,
including HSBC Holdings PLC,
KPMG Audit PLC, PricewaterhouseCoopers LLP, Morningstar Inc. and Visa Inc. The
first 159 apartments all sold
out within 3½ hours when put
on the market in 2013.
More than 80 restaurants,
bars and other attractions also
have transformed the onceabandoned docklands area in
central Sydney.
“The number of people
flooding into the spaces that
have already opened is extraordinary,” said Chris Wilkinson, architect of the tallest
tower in the 54-acre master
plan, a one billion Australian
dollars (US$758 million) hotel
and casino expected to break
ground this year. “It’s absolutely full of life.”
The success has meant big
profits for Sydney-based
Lendlease Corp. Ltd., the lead
developer of the first A$6 billion phase of the project,
named Barangaroo South. In
July, Lendlease began its current fiscal year with A$1 billion in cash thanks mostly to
“urbanization projects, led by
commercial at Barangaroo
South,” the company’s chief financial officer, Tarun Gupta,
said on its earnings call in Au-
BRENDON THORNE/BLOOMBERG NEWS
PLOTS
& PLOYS
The Barangaroo development under construction in 2016. The first three towers are now finished.
gust. “The income from our
more than A$600 million in
direct investment in these
towers is expected to increase
again in the coming year,” he
said.
To be sure, it is too early
for champagne for the planners and developers who
struggled against community
groups trying for years to
limit the commercial development of Barangaroo. Opponents who have mostly objected to the scale of the
project, for example, went into
an
uproar
over
Lendlease’s 2015 modifications,
which increased the total
building footprint of Barangaroo South to 46% from 40% of
the site in part by adding a
Crown hotel and casino in a
prime waterfront location.
“The new designs plunge
public spaces into shadow,”
said John McInerney, former
city of Sydney chief planner,
who is part of a planning
group that unsuccessfully
challenged the tower’s location in court.
An additional 4.3
million square feet of
commercial space will
be added by 2024.
Moreover, Barangaroo is far
from finished. An additional
4.3 million square feet of commercial space will be added to
the 54-acre Barangaroo site by
the time the entire project is
completed in 2024.
It is still far from clear
whether the new space will be
equally successful in attracting
tenants. Especially murky is
the future of the planned casino in Barangaroo’s tallest
building, a 902-foot tower—
slated to be developed by
Lendlease and operated by
Australian gambling company
Crown Resorts Ltd.—given
the recent downturn in the
number of wealthy Chinese
tourists in pursuit of VIP gambling facilities.
Meanwhile, fights are shaping up between competing developers. Recently, development rights to a 13-acre parcel
were awarded to a venture of
construction company Grocon
Pty. Ltd., Chinese-backed developer Aqualand Projects
Pty. Ltd. and Scentre Group
Ltd. Many expect this venture
to try to renegotiate on building heights following the government’s insistence that its
site should include a new
metro stop. But this would
likely be of concern to Lendlease and Crown, whose own
towers have priceless sightlines with Sydney Harbour.
The
Grocon-led
consortium declined to comment.
Still, it is a sign of Barangaroo’s commercial success that
developers may be squabbling
over who can build higher, observers say. “This is the last
waterfront site in the Sydney
[central business district]
available for development. You
could say it’s iconic,” said
Lawson Hubbard of broker
CBRE Group Inc., which represented the majority of the tenants in the first phase.
Developers have created
successful projects in other
cities around the world. But it
has sometimes taken years for
them to reach critical mass.
For example, London’s Canary
Wharf, which celebrates its
30th anniversary this year,
helped drive its original developer, Olympia & York, into
bankruptcy protection in 1992.
Hudson Yards, the largest
private development in the
U.S. now rising in New York,
has learned from those mistakes. That project’s developer,
a venture led by Related Cos.,
has attracted numerous major
tenants
from
Midtown
by timing new office buildings
to a new subway station and
residential development.
Barangaroo, too, is banking
on getting the commercial,
residential and leisure equation right. The master plan
also includes the 15-acre Headland Park, a public space built
by the New South Wales government and opened in 2015.
“We worked very hard to
curate a really fantastic mix of
restaurants and amenities,”
said Rob Deck, Lendlease’s
managing director for Barangaoo South.
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Photo Credit: ICSC 2014 VIVA Design and Development Winner: City Creek Center
Owner: Taubman Centers | Photo credit: Alan Blakey Photography
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B8 | Wednesday, May 2, 2018
NY
THE WALL STREET JOURNAL.
* *****
BUSINESS & FINANCE
Diageo Lightens Up Vodka Brand Vista Outdoor to Halt
Buzzier Brand
Tito's Handmade vodka, which
is advertised as gluten-free,
has made inroads in the U.S.
market.
20%
15
Smirnoff
10
Tito's
5
0
2014
’18
Absolut
Ketel One
Grey Goose
Ciroc
Note: For three months ended March 29,
2014, and March 24, 2018
CRAIG BARRITT/GETTY IMAGES FOR KETEL ONE
The owner of Ketel One
vodka thinks it has an answer
to slumping U.S. sales: less alcohol.
Diageo PLC, the world’s
largest liquor maker, said it is
launching a botanical version
of Ketel One with 30% alcohol
by volume. The new drink
doesn’t meet the definition of
vodka under U.S. and European
regulations, which mandate
that neutral distilled spirits
must be bottled at 40% alcohol
by volume and flavored ones at
37.5%. Instead, Diageo will market the new Ketel One as
“made with vodka.”
Ketel One and other big
vodka brands have been losing
market share to Fifth Generation Inc.-owned Tito’s Handmade vodka, which is made
from corn and is advertised as
gluten-free. Tito’s market share
by volume stood at 8.1% for the
four weeks to March 24, up
from 6.1% a year earlier, according to data from Bernstein.
Ketel One’s market share was
1.7%, down from 1.8%.
Diageo,
which
owns
Smirnoff and Ciroc vodkas and
co-owns Ketel One with the
Nolet family, is hoping the new
drink taps into the demand for
healthier drinks. It says a 1.5
oz. shot of Ketel One Botanical
will have 73 calories, 40% less
than in a 5 oz. glass of white
wine and 25% less than in a
shot of regular Ketel One.
Ketel One Botanical will retail for a suggested price of
$24.99 for a 750- milliliter bottle, the same as a bottle of Ketel One Vodka.
For the six months to Dec.
With less alcohol, a new Ketel One drink won’t even qualify as vodka.
31, Ketel One’s net sales in
North America dropped 13%
from a year earlier excluding
currency fluctuations, while Ciroc’s net sales fell 11%. Sales of
Smirnoff—still the market
leader—were down 2%.
In its previous attempts to
bolster its vodka brands, Diageo has sponsored music festivals, marketed to the U.S.’s gay
and lesbian community and experimented with flavors. In
2016 it began selling Smirnoff
infused with real fruit. More
recently, the London-based
company has cut prices on Ketel One to try to compete with
Tito’s.
The launch of Ketel One Botanical is the first time Diageo
has sold a low-alcohol version
of the vodka brand. It comes as
many consumers, and especially millennials, are cutting
back on alcohol, both by having
fewer servings at a time and
switching to weaker drinks.
A 2016 survey from research
firm GlobalData found 54% of
Americans between 25 and 34
years old were actively trying
to cut back on alcohol, a higher
percentage than were trying to
consume less fat, carbohydrates and sugar. While beer
sales have been slumping,
some of the bright spots have
been sales of lower-alcohol,
lower-calorie brews such as
Anheuser-Busch InBev SA’s Michelob Ultra.
Diageo is hoping the new
Ketel One will appeal to women
and in particular wine drinkers.
It plans to market it as something to be drunk in a wine
glass with soda, ice and fresh
herbs or fruit.
“A lot of that consumption
is moving away from wine and
we’ve got a targeted campaign
against it,” said Diageo CEO
Ivan Menezes on an investor
call earlier this year.
Bernstein analyst Trevor
Stirling said it is unlikely the
latest offering will have a
meaningful impact on sales.
“Innovation like this rarely
pulls a brand around,” he said.
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High-End Saltwater Fishing Rod Mfg. Seeks $1.5M
Equity Investment. Expansion capital needed to fund
increased production. Natl distrib & mktg channels established. Co-branding & private label for industry
leaders. This is the Porsche of fishing rod companies.
Projected revenue $12M by 2020. Complete Offering
Memorandum w/signed NDA. No brokers. Looking to
close by 5/15. Email: sweintz@sbwventuresinc.com
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L K *L 2
Firearm Production
BY DOUG CAMERON
AND CARA LOMBARDO
Vista Outdoor Inc. said it
would stop making firearms as
the nation’s largest maker of
ammunition plans to pare back
a sprawling portfolio tied to
the $90 billion-a-year outdoor-pursuits market.
The maker of Federal Premium bullets and CamelBak
water bottles plans to sell its
Savage Arms and Stevens firearms brands as part of a strategic review.
The company said the move
wasn’t tied to actions by some
retailers that said they would
halt sales of all the company’s
products after a Florida highschool shooting in February.
The company said Tuesday
it would focus on business
lines including ammunition
and shooting accessories, water bottles and outdoor cooking ware. It will also explore
the sale of brands including
Bell bike helmets.
XEROX
Continued from page B1
the entire board, by giving
Messrs. Icahn and Deason six
of what will now be nine seats.
Together, the two billionaires
control about 15% of Xerox as
the first- and third-largest investors. Keith Cozza, who is
chief executive of Mr. Icahn’s
public company, will be named
chairman of Xerox.
Xerox will name as chief
executive John Visentin. Xerox had considered Mr.
Visentin as the leading candidate to replace Mr. Jacobson last year before it ended
its search and reaffirmed
faith in him, The Wall Street
Journal has reported. Mr.
Visentin is a former executive at several technology
companies and had been
working with the activist investors at Xerox.
The settlement doesn’t include pending litigation Mr.
Deason has against Fujifilm.
The judge also criticized Fujifilm’s actions in his opinion
halting the deal. That pending
litigation could give the new
Xerox board some leverage in
discussions with Fujifilm.
Fujifilm, which wasn’t immediately available to comment,
has defended the transaction
and said it was negotiated
fairly.
Xerox had previously defended Mr. Jacobson and said
that he had won over the
PUBLIC NOTICES
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(&)* " # $% %+ , -
" " ". / 0 11
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24 15 " TRAVEL
Save Up To 60%
First & Business
INTERNATIONAL
Major Airlines, Corporate Travel
Never Fly Coach Again!
www.cooktravel.net
(800) 435-8776
Ammunition to get new focus.
Shares in Vista Outdoor
ended down more than 13% as
fiscal fourth-quarter sales fell
1% and profit dropped 24%
from a year ago.
The company guided its
full-year profit sharply below
analysts’ forecasts. Vista Outdoor and other gun makers
have faced a backlash since the
February shooting that left 17
people dead in Parkland, Fla.
board by hitting earnings and
financial targets, and that the
whole board believed the Fujifilm deal was the best option.
But the judge’s opinion last
week left the board in a bind:
Xerox would have to fight two
big investors over its board
without being able move forward with its deal or negotiate an improved offer from
Fujifilm.
The judge has to sign off on
the settlement.
Seven of the old board
members will resign, including
Chairman Robert Keegan, who
approved Mr. Jacobson’s negotiations, and lead director Ann
Reese, who also approved of
his talks with Fujifilm.
Xerox and Fujifilm have
been in discussions about renegotiating the deal, but Fujifilm will now face a new board
led by a team that wants to
not only end the sale but also
potentially cancel the 50-plusyear joint venture, Fuji Xerox,
that is at the heart of their relationship.
Xerox had asked Fujifilm to
sweeten the deal, but in its
statement Tuesday night, Xerox said Fuji had yet to make
an improved offer.
Fujifilm owns 75% and Xerox 25% of their joint venture
in Asia. Under their prospective deal, that joint venture
would be folded into U.S.based Xerox, and Fujifilm
would own 50.1% of Xerox.
Current Xerox shareholders
would also be paid a $2.5 billion special dividend.
New Highs and Lows | WSJ.com/newhighs
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.
Tuesday, May 1, 2018
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GEORGE FREY/BLOOMBERG NEWS
BY SAABIRA CHAUDHURI
AND CARA LOMBARDO
52-Wk %
Sym Hi/Lo Chg Stock
Stock
Highs
Abiomed
ABMD
AdestoTech
IOTS
Apptio
APTI
Avangrid
AGR
AveXis
AVXS
BGStaffing
BGSF
BP
BP
BSB Bancorp
BLMT
BaytexEnergy
BTE
Brightcove
BCOV
BrinkerIntl
EAT
Curo
CURO
Cameco
CCJ
CareDx
CDNA
CeridianHCM
CDAY
ChannelAdvisor ECOM
ChesapeakeLodging CHSP
CitrixSystems
CTXS
ColliersIntl
CIGI
ConnecticutWater CTWS
Denny's
DENN
8x8
EGHT
ElevenBiotherap EBIO
EloxxPharm
ELOX
EnterpriseFinSvcs EFSC
Espey
ESP
ExtraSpaceSt
EXR
F5Networks
FFIV
FTI Consulting
FCN
FTS Intl
FTSI
58.com
WUBA
FirstBanCorp
FBP
Freshpet
FRPT
HomeTownBkshs HMTA
IcahnEnterprises IEP
Immunomedics IMMU
IncomeOppRealty IOR
InfinityPropCas IPCC
InflaRx
IFRX
Inogen
INGN
Insperity
NSP
IntelligentSys
INS
Intelsat
I
Joint
JYNT
KBLMergerIV
KBLM
KirklandLakeGold KL
Medpace
MEDP
MidConEnergy
MCEP
MuleSoft
MULE
Novocure
NVCR
Perficient
PRFT
Regis
RGS
SVB Fin
SIVB
Seaspan
SSW
Smartsheet
SMAR
SophirisBio
SPHS
Strats WlMrt GJO GJO
SummitStateBk SSBI
TenetHealthcare THC
TexasPacLand
TPL
TownSports
CLUB
TransGlobeEner TGA
Travelzoo
TZOO
TriNet
TNET
TurtleBeach
HEAR
Twilio
TWLO
UFP Tech
UFPT
USG
USG
Validus
VR
VistraEnerUn
DYNC
VistraEnergyWt VST.WS.A
W&T Offshore WTI
WEX
WEX
WhitingPetrol
WLL
311.60
9.85
33.28
53.50
216.90
20.61
45.10
33.40
4.58
9.95
46.42
23.32
11.26
10.43
32.40
13.50
30.09
104.88
73.80
69.72
17.75
20.68
2.92
13.60
51.50
27.28
90.57
164.88
58.96
21.65
88.94
7.42
20.90
12.24
67.67
19.04
13.70
134.10
42.83
175.33
83.00
5.41
13.86
7.85
10.00
17.94
40.68
2.46
44.75
27.85
25.00
17.46
308.37
8.10
20.00
2.87
22.90
15.00
29.51
593.38
9.60
1.90
12.45
52.98
5.84
42.97
34.00
42.14
67.80
93.87
0.64
6.37
165.60
42.48
3.2
5.0
4.5
0.7
1.8
6.4
0.5
2.5
1.1
1.6
2.9
6.6
5.9
5.1
-0.3
1.1
1.5
1.7
7.5
1.7
-1.3
2.0
4.3
8.1
0.3
2.8
0.9
1.0
0.7
-2.3
1.4
2.8
5.1
-0.5
3.8
4.6
6.3
1.2
5.9
23.2
2.7
1.7
33.4
4.2
...
2.7
3.2
9.3
...
1.1
-3.6
8.8
2.0
4.6
2.8
4.8
3.2
0.4
19.1
8.4
2.7
1.9
8.7
2.2
-4.4
0.8
2.0
4.4
-0.2
...
1.6
3.3
2.2
3.0
Lows
ABMIndustries
AT&T
AcuityBrands
ABM
T
AYI
30.26 -1.6
32.36 -0.5
110.67 -4.9
52-Wk %
Sym Hi/Lo Chg Stock
52-Wk %
Sym Hi/Lo Chg
57.35 1.1 Invuity
AdvEnergyInds AEIS
IVTY
IPAS
5.03 0.4 iPass
AileronTherap
ALRN
IRIX
8.93 1.3 Iridex
AkebiaTherap
AKBA
JMU
75.44 -0.1 JMU
Allegion
ALLE
K
201.49 0.1 Kellogg
AllianceData
ADS
KHC
17.25 -2.3 KraftHeinz
AlticeUSA
ATUS
LB
1.05 -10.2 L Brands
Amedica
AMDA
LEG
AmHomes4RentPfdF AMHpF 22.43 -0.9 Leggett&Platt
LEJU
AmHomes4RentPfdG AMHpG 22.30 -0.3 LejuHoldings
LC
8.19 2.8 LendingClub
AmkorTech
AMKR
96.14
... LibertyLatAmA LILA
AB InBev
BUD
37.00 -1.3 LibertyLatAmC LILAK
Apergy
APYw
LWAY
17.58 -0.7 LifewayFoods
Arconic
ARNC
LECO
12.03 -0.5 LincolnElectric
ArmstrongFlooring AFI
LGF.B
AscentCapital A ASCMA
3.10 -3.8 LionsGate B
LGF.A
AssuredGuarBds AGOpB 25.36 0.3 LionsGate A
MNGA
1.20
... MagneGas
AsteriasBiotherap AST
MNK
AvadelPharm
6.54 -0.9 Mallinckrodt
AVDL
MAN
52.45 -3.9 Manpower
BarnesGroup
B
85.23 -1.0 MartinMarietta MLM
BeldenPfdB
BDCpB
61.00 -0.3 MercurySystems MRCY
Belden
BDC
MERpP
10.30 -2.8 MLCapTrstPfd
Belmond
BEL
25.75 1.5 MidatechPharma MTP
BenchmarkElec BHE
MohawkInds
MHK
BioTimeWt
0.05 -9.0
BTX.WS
MDLZ
5.49 -4.1 Mondelez
BridgepointEduc BPI
MPAA
17.11 -3.0 MotorcarParts
Briggs&Stratton BGG
MWA
48.53 0.8 MuellerWater
CBS B
CBS
MUSA
48.75 0.5 MurphyUSA
CBS A
CBS.A
NN
NNBR
32.30 2.1
CEVA
CEVA
NNVC
16.52 -1.6 NanoViricides
CSS Industries CSS
NatlStoragePfdA
NSApA
18.15 1.4
Caesarstone
CSTE
0.45 -6.8 NavideaBiopharm NAVB
CamberEnergy CEI
NaviosMaritimPf
NMpG
0.85 -0.2
CancerGenetics CGIX
NaviosMariPfdH NMpH
...
CapsteadMtgPfdE CMOpE 24.64
NewMarket
NEU
95.62 1.8
CaseysGenStores CASY
nVentElectric
NVT
6.40 -4.4
CellcomIsrael
CEL
O2MicroIntl
OIIM
5.97 -2.3
Cemex
CX
Och-Ziff
OZM
Check-Cap Wt
0.06 -20.0
CHEKW
OrchidsPaper
TIS
39.84 -1.2
CircorIntl
CIR
PartnerComms PTNR
44.75 -0.8
CleanHarbors
CLH
Pentair
PNR
5.90 -3.3
ClearOne
CLRO
PepsiCo
PEP
22.51 -1.7
ClearwaterPaper CLW
PlatinumGrpMtls PLG
42.20 4.1
ClovisOncology CLVS
PrestigeBrands PBH
63.03 -0.9
Coca-Cola Femsa KOF
Procter&Gamble PG
39.90 -0.3
Cognex
CGNX
RadiantLogistics RLGT
64.63 -0.4
ColgatePalm
CL
RegenPharm
REGN
Comcast A
CMCSA 31.21 2.1
ReToEcoSol
RETO
26.29 -27.8
CommScope
COMM
RevenHousingREIT RVEN
14.95 -1.5
CoreMoldingTech CMT
SalemMedia
SALM
25.10 -2.4 ScrippsEW
CntrwdCapV
CFCpB
SSP
47.82 -3.1 SleepNumber
CrownHoldings CCK
SNBR
10.30 -1.0 SpiritRealtyPfdA SRCpA
CueBiopharma
CUE
149.10 -4.1 Startek
Cummins
CMI
SRT
1.25 -10.7 StellarBiotech
DHI Group
DHX
SBOT
2.60
... Stepan
DHX Media VV DHXM
SCL
32.87 -0.4 SynergyPharm
DISH Network
DISH
SGYP
2.23 -1.7 SynovusFinlPfdC SNVpC
DRDGOLD
DRD
8.16 3.3 TDH
Daseke
DSKE
PETZ
56.36 -0.2 Tegna
DormanProducts DORM
TGNA
3.63
... TESARO
EXFO
EXFO
TSRO
EquityCommonPfdD EQCpD 25.25 -0.1 Tenneco
TEN
27.60 -0.9 The9
FarmerBros
FARM
NCTY
24.98 -4.0 3M
FederatedInvest FII
MMM
23.30 -4.9 Tintri
FirstLongIsland FLIC
TNTR
53.92 1.9 TitanPharm
FortBrandsHome FBHS
TTNP
1.83 -6.6 TootsieRoll
ForwardPharma FWP
TR
2.04 -14.4 Toro
Fred's
FRED
TTC
15.23 -1.0 TribuneMediaA TRCO
GatesIndustrial GTES
5.35 1.6 trivago
GemphireTherap GEMP
TRVG
15.76 -19.7 Truett-Hurst
Glatfelter
GLT
THST
25.06 1.2 US Concrete
Goodyear
GT
USCR
11.05 0.4 UltraparPart
GrayTelevision
GTN
UGP
HainCelestial
26.88 -1.9 VBI Vaccines
HAIN
VBIV
40.13 -1.0 Valvoline
HarleyDavidson HOG
VVV
90.88 -0.7 VenatorMaterials VNTR
Hershey
HSY
7.14 -2.3 VirnetX
HorizonGlobal
HZN
VHC
Hubbell
HUBB 100.55 -1.3 VolitionRX
VNRX
5.19 -2.2 VulcanMatls
IDT
IDT
VMC
28.04 -1.8 WideOpenWest WOW
Invesco
IVZ
0.68 -15.0 Wipro
IconixBrand
ICON
WIT
60.63 -1.8 WorldFuelSvcs
Incyte
INCY
INT
4.65 -27.1 XeneticBiosci
Intevac
IVAC
XBIO
3.10
0.26
5.14
0.57
58.21
55.30
34.02
39.57
0.96
2.57
18.26
17.90
5.09
81.94
22.03
23.79
0.58
12.75
94.19
189.27
31.15
25.35
0.71
207.79
38.55
18.53
9.62
61.57
19.65
0.65
23.58
0.26
10.18
10.36
367.85
21.00
1.30
1.91
5.85
3.83
43.76
98.57
0.19
28.26
71.66
3.46
294.11
5.15
2.32
3.10
10.84
27.44
20.26
8.40
0.66
68.62
1.47
25.34
3.17
10.40
48.45
44.33
0.32
191.44
0.97
0.85
28.05
56.83
36.48
4.25
1.32
53.30
16.86
2.95
20.02
17.03
2.10
1.85
108.17
6.03
4.71
20.60
1.59
-6.1
-5.3
-2.7
-8.3
-0.3
-1.2
-1.7
-0.4
-4.8
-0.7
1.3
1.0
-3.4
1.0
-4.2
-4.2
-3.3
0.8
0.5
0.2
1.2
-3.6
22.7
2.8
-1.3
1.1
0.5
2.1
-0.7
3.9
-0.2
-3.5
2.4
-1.2
-1.6
2.8
-1.5
2.1
1.1
-2.4
-0.8
-1.8
3.9
-0.3
-0.5
1.1
-0.8
-5.9
...
4.8
-0.4
0.4
-0.3
-4.2
-3.4
0.5
-4.5
0.7
-15.2
-0.2
-0.7
3.0
-1.4
0.3
-11.5
-4.4
-0.4
-0.3
-2.8
-3.4
-17.5
-2.7
-1.3
...
-0.1
-2.0
...
-4.5
0.1
0.2
-0.4
1.3
-3.7
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | B9
MARKETS DIGEST
EQUITIES
S&P 500 Index
Dow Jones Industrial Average
Last Year ago
24099.05 t 64.10, or 0.27%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio 23.97 20.48
P/E estimate *
16.17 17.83
Dividend yield
2.21
2.33
All-time high 26616.71, 01/26/18
Current divisor 0.14523396877348
Last
2654.80 s 6.75, or 0.25%
High, low, open and close for each
trading day of the past three months.
Year ago
Trailing P/E ratio * 24.09 24.17
P/E estimate *
16.99 18.42
Dividend yield
1.95
1.97
All-time high 2872.87, 01/26/18
Nasdaq Composite Index
Last Year ago
7130.70 s 64.44, or 0.91%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio * 25.01
26.04
P/E estimate *
19.97
20.75
Dividend yield
1.04
1.09
All-time high: 7588.32, 03/12/18
Session high
Open
t
Close
2900
7500
2825
7300
25200
2750
7100
24400
2675
6900
23600
2600
6700
22800
2525
6500
26800
UP
Close
t
DOWN
Session open
26000
65-day moving average
Session low
65-day moving average
65-day moving average
Bars measure the point change from session's open
2450
22000
Jan.
Feb.
Mar.
Jan.
Apr.
Feb.
Mar.
Apr.
6300
Jan.
Feb.
Mar.
Apr.
*Weekly P/E data based on as-reported earnings from Birinyi Associates Inc.
Major U.S. Stock-Market Indexes
High
Latest
Close
Low
Net chg
% chg
52-Week
Low
High
% chg
% chg
3-yr. ann.
YTD
Dow Jones
24117.29 23808.19 24099.05 -64.10
-0.27
26616.71 20606.93
15.0
-2.5
Transportation Avg 10437.25 10293.14 10388.39 -35.18
-0.34
11373.38
8783.74
13.5
-2.1
5.9
-0.25
774.47
647.90
0.5
-2.5
6.1
29630.47 24391.29
757.37
624.99
11.0
11.1
-0.5
0.1
7.7
7.5
Industrial Average
707.81
Utility Average
Total Stock Market
Barron's 400
703.48
705.23
-1.78
27529.96 27231.71 27526.83
711.42
702.44
711.29
74.14
2.41
Nasdaq Stock Market
Nasdaq Composite
7133.27
Nasdaq 100
6685.41
7036.18
6578.26
7130.70
6681.96
0.27
0.34
64.44
76.39
0.91
1.16
7588.32
7131.12
6011.24
5580.55
10.2
3.3
4.5
17.0
18.4
12.5
14.3
S&P
500 Index
2655.27
2625.41
2654.80
6.75
0.25
2872.87
2357.03
11.0
-0.7
8.0
MidCap 400
SmallCap 600
1881.07
952.45
1855.01
937.51
1879.57
951.88
7.12
4.37
0.38
0.46
1995.23
979.57
1691.67
817.25
8.4
11.7
-1.1
1.7
7.5
10.4
Other Indexes
Russell 2000
1550.86
1527.71
1550.33
8.44
0.55
1610.71
1355.89
10.8
1.0
8.1
12493.07 12388.95 12493.02 -22.34
NYSE Composite
549.58
543.43
549.57
0.31
NYSE Arca Biotech
4521.43
4436.95
4519.80
44.97
NYSE Arca Pharma
525.75
520.21
524.48
0.03
KBW Bank
107.23
105.80
0.10
PHLX§ Gold/Silver
107.10
81.43
80.19
0.27
PHLX§ Oil Service
81.42
154.81
152.02
153.80
1266.87
16.82
1240.89
15.42
1265.94
15.49
Value Line
PHLX§ Semiconductor
Cboe Volatility
13637.02 11423.53
Close
3050.03
394.25
264.43
The Global Dow
DJ Global Index
DJ Global ex U.S.
DJ Americas
636.95
Sao Paulo Bovespa 86115.50
S&P/TSX Comp
15618.93
S&P/BMV IPC
48358.16
Santiago IPSA
4282.26
Asia-Pacific
Australia
China
Hong Kong
India
Japan
Singapore
South Korea
Taiwan
Thailand
Most-active issues in late trading
Symbol
Volume
(000)
nVent Electric
NVT
16,481.6
22.72
…
0.02
22.80
22.65
-15.43
14.45
11.50
Company
Net chg
After Hours
% chg
High
Low
Snap
SNAP 15,680.6
11.95
-2.18
SPDR S&P 500
SPY
11,993.3 265.37
0.39
Apple
AAPL 10,615.7 175.56
6.46
Knowles Corp.
KN
7,822.2
12.64
…
unch.
12.69
General Electric
GE
5,962.4
14.06
0.01
0.07
14.09
13.95
Ford Motor
F
4,456.4
11.23
-0.03
-0.27
11.27
11.22
Pfizer
PFE
3,874.6
35.43
0.03
0.08
35.52
35.15
Community Health Systems CYH
90.2
4.37
0.40
10.08
4.49
3.89
Enphase Energy
ENPH
55.7
4.44
0.38
9.36
4.50
3.72
Shutterfly
SFLY
129.3
88.99
7.44
9.12
90.00
81.36
250.2
8.87
0.72
8.83
8.87
8.12
83.3
51.50
2.92
6.01
53.69
48.53
0.15 265.55 264.41
3.82 178.00 167.65
12.59
Percentage gainers…
8.2
-2.5
3.9
-2.3
2.4
4939.86
3507.64
24.5
7.0
5.2
0.01
593.12
514.07
1.8
-3.8
-3.4
...And losers
0.09
116.52
88.87
16.7
0.4
13.1
Snap
SNAP 15,680.6
11.95
-2.18
-15.43
14.45
11.50
0.34
93.26
76.42
0.2
-4.5
3.6
Yum China Holdings
YUMC
181.7
39.50
-2.97
-6.99
44.50
38.10
165.78
117.79
3.2
Gilead Sciences
GILD
866.4
68.40
-4.16
-5.73
72.56
67.85
1.73 1445.90
37.32
1004.62
9.14
26.0
46.3
Tanger Factory Outlet Ctr SKT
104.8
21.10
-1.22
-5.47
22.32
20.60
Paycom Software
157.4 107.15
-5.44
-4.83 112.75 106.88
1.00
-2.02 -1.30
-2.76
2.8 -11.6
1.0
40.3
21.5
6.8
Frontier Communications FTR
Zendesk
ZEN
PAYC
Stoxx Europe 600
Euro Stoxx
Bel-20
OMX Copenhagen
CAC 40
DAX
Tel Aviv
FTSE MIB
AEX
RTS Index
FTSE/JSE All-Share
IBEX 35
OMX Stockholm
Swiss Market
BIST 100
FTSE 100
FTSE 250
385.03
390.42
3910.30
891.34
5520.50
12612.11
1463.83
23979.37
555.73
1153.96
58252.12
9980.60
577.45
8886.26
104282.78
7520.36
20348.32
S&P/ASX 200
6015.20
Shanghai Composite 3082.23
Hang Seng
30808.45
S&P BSE Sensex
35160.36
Nikkei Stock Avg
22508.03
Straits Times
3613.93
Kospi
2515.38
TAIEX
10657.88
SET
1780.11
Percentage Gainers...
Net chg
Latest
% chg
YTD
% chg
–1.2
–0.8
–0.9
–11.62 –0.38
–0.13
–0.53
–1.38 –0.52
0.19
Closed
0.07
Closed
Closed
1.21
…
11.05
…
…
–0.29
–0.01
…
5.58
…
…
–1.41
…
…
…
…
…
…
…
…
11.06
63.27
–0.8
12.7
–3.6
–2.0
1.7
–1.1
1.3
–1.7
0.63 –3.9
Closed
3.9
Closed
–2.4
–3.0
–0.10
Closed
9.7
Closed
2.0
Closed
–0.04
Closed
–2.1
Closed
–0.6
Closed
1.5
Closed
–5.3
Closed
–9.6
0.15
–2.2
0.31
–1.8
–0.08
–0.003
Closed
32.50
…
…
…
40.16
…
…
…
…
0.54
Closed
Closed
Closed
0.18
Closed
Closed
Closed
Closed
–0.8
–6.8
3.0
3.2
–1.1
6.2
1.9
0.1
1.5
Sources: SIX Financial Information; WSJ Market Data Group
Company
Symbol
Heat Biologics
Intelsat
Essa Pharma
Inogen Inc.
Quantenna Communications
HTBX
Tenet Healthcare
Nemaura Medical
Nutrisystem
Electronics for Imaging
MagnaChip Semiconductor
THC
Sabre Corp.
SemiLEDS
TapImmune
Newater Technology
Park City Group
SABR
High
52-Week
Low
% chg
7.89 1.09
13.86 2.44
51.00 2.00
175.33 80.04
22.50 9.60
-45.8
313.7
-87.8
104.4
-17.2
CommScope Holding
Intevac
Match Group
Glatfelter
IAC/InterActive
COMM
28.52
3.93
34.25
32.33
10.90
4.58
0.63
5.25
4.63
1.55
19.13
19.09
18.10
16.71
16.58
29.51 12.25
9.60 2.50
67.95 26.06
50.98 25.28
13.40 8.20
52.8
31.0
-33.4
-29.7
29.8
Lumber Liquidators
TDH Holdings
Genprex
Accuray
Fred's
LL
23.55
4.87
2.99
13.02
8.80
2.91
0.60
0.34
1.39
0.90
14.10
14.05
12.83
11.95
11.39
25.01 17.30
10.49 1.61
4.41 2.58
28.20 7.32
15.00 7.90
-4.5
64.5
-27.4
...
-28.2
US Cellular
Vista Outdoor
Orthofix International
Cocrystal Pharma
Tapestry
USM
NTRI
EFII
MX
LEDS
TPIV
NEWA
PCYG
Neovasc
iShares MSCI Emg Markets
SPDR S&P 500
Ford Motor
Bank of America
NVCN
Finl Select Sector SPDR
General Electric
Pfizer
Apple
Sprint Corp.
XLF
EEM
SPY
F
BAC
GE
PFE
AAPL
S
U.S. consumer rates
Selected rates
A consumer rate against its
benchmark over the past year
New car loan
52-Week
High
Low
t
New car loan
t
3.50
2.50
M J J A S ON D J FMAM
2017
2018
2.90%
877-FSB-1879
STAR Financial Bank
Fort Wayne, IN
2.93%
765-622-4173
Elmira Savings Bank
Elmira, NY
2.95%
607-734-3374
Yield/Rate (%)
Last (l)Week ago
Federal-funds rate target
1.50-1.75 1.50-1.75
Prime rate*
4.75
4.75
Libor, 3-month
2.36
2.35
Money market, annual yield
0.36
0.41
Five-year CD, annual yield
1.67
1.68
30-year mortgage, fixed†
4.56
4.55
15-year mortgage, fixed†
4.07
4.02
Jumbo mortgages, $424,100-plus† 4.84
4.85
Five-year adj mortgage (ARM)† 4.69
4.48
New-car loan, 48-month
3.82
4.22
3-yr chg
52-Week Range (%)
Low 0 2 4 6 8 High (pct pts)
0.75 l
l
4.00
l
1.17
0.25 l
l
1.29
l
3.73
l
2.99
l
4.21
l
3.22
l
2.85
1.50
4.75
2.37
0.41
1.69
4.62
4.07
4.96
4.69
4.22
1.50
1.50
2.07
0.05
0.23
0.66
0.90
0.68
1.43
1.32
Bankrate.com rates based on survey of over 4,800 online banks. *Base rate posted by 70% of the nation's largest
banks.† Excludes closing costs.
Sources: SIX Financial Information; WSJ Market Data Group; Bankrate.com
One year ago
1
3 6
month(s)
1 2 3 5 710
years
maturity
27.46 0.04
14.05 -0.14
35.40 -3.31
169.10 2.32
5.42 -3.39
30.33 22.97
29.47 12.73
39.43 31.67
183.50 142.20
9.17
4.81
KLX
Fidelity MSCI Cons Disc
iShares Global Utilities
SPDR Hlth Cr Eqp
PowerShs Dynamic Leisure
KLXI
5
1.50
0
0.75
–5
0.00
–10
30
-33.9
-62.7
91.9
-20.7
38.5
19.86
3.96
13.20
4.28
2.05
-4.21
-0.71
-2.29
-0.73
-0.35
-17.49
-15.20
-14.78
-14.50
-14.41
41.33 19.46
31.75 3.17
19.45 3.84
6.15 3.60
16.27 2.04
-5.7
...
...
1.8
-86.5
34.02
14.56
53.12
1.86
47.46
-5.55
-2.19
-7.90
-0.26
-6.31
-14.03
-13.07
-12.95
-12.26
-11.74
41.82
25.07
61.86
6.58
55.50
-13.0
-25.7
32.2
...
10.0
32.06
12.36
37.35
0.17
38.70
PFIG
EQAL
ESXB
TFLO
FDIS
JXI
XHE
PEJ
Volume % chg from Latest Session
(000) 65-day avg Close % chg
52-Week
High
Low
24,223
737
1,756
504
550
26093
2313
2130
1889
1819
22.72
24.64
30.68
8.80
50.21
2.81
-0.40
-0.39
1.15
-0.01
27.00
26.70
32.78
9.35
50.64
21.00
24.60
27.76
7.65
50.00
7,843
1,830
295
369
350
1591
1284
1273
1207
1185
71.50
40.60
49.92
71.92
44.99
-8.60
0.20
-0.26
0.93
...
82.50
42.99
53.07
72.51
46.77
45.73
34.62
45.15
55.87
39.50
U.S.-dollar foreign-exchange rates in late New York trading
Euro
US$vs,
YTDchg
Tues
in US$ per US$ (%)
Yen
Vietnam dong
Argentina peso
.0487 20.5315 10.4
Brazil real
.2851 3.5076 5.9
Canada dollar
.7781 1.2852 2.2
Chile peso
.001629 613.80 –0.3
Ecuador US dollar
1
1 unch
Mexico peso
.0528 18.9523 –3.7
Uruguay peso
.03508 28.5100 –1.0
Venezuela b. fuerte .00001566870.0001 646496.1
Europe
WSJ Dollar index
2017
2018
Yield (%)
Last Week ago
52-Week
High
Low
Total Return (%)
52-wk
3-yr
2.838
2.976
3.914
3.320
6.059
3.440
2.639
2.833
2.983
3.863
3.310
5.996
3.480
2.604
2.863
3.026
3.914
3.340
6.319
3.510
2.653
1.818
2.058
2.879
2.380
4.948
2.660
1.736
–1.525
–3.579
–0.144
–0.327
2.049
–0.381
1.124
6.328
6.197
6.328
5.279 –0.223 4.238
0.326
–0.571
2.158
1.103
3.151
0.934
1.918
Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch
Australian dollar
.7491 1.3349
China yuan
.1579 6.3333
Hong Kong dollar
.1274 7.8492
India rupee
.01497 66.783
Indonesia rupiah .0000715 13979
Japan yen
.009102 109.86
Kazakhstan tenge .003045 328.38
Macau pataca
.1234 8.1055
Malaysia ringgit
.2550 3.9215
New Zealand dollar
.7005 1.4276
Pakistan rupee
.00865 115.650
Philippines peso
.0193 51.799
Singapore dollar
.7500 1.3333
South Korea won .0009315 1073.48
Sri Lanka rupee
.0063391 157.75
Taiwan dollar
.03369 29.682
Thailand baht
.03156 31.690
Commodities
4.2
–2.6
0.5
4.6
3.7
–2.5
–1.3
0.7
–3.4
1.3
4.5
3.7
–0.3
0.6
2.8
0.1
–2.8
US$vs,
YTDchg
Tues
in US$ per US$ (%)
Country/currency
Americas
Asia-Pacific
Corporate Borrowing Rates and Yields
Treasury, Ryan ALM
1422.879
10-yr Treasury, Ryan ALM 1660.197
DJ Corporate
367.708
Aggregate, Barclays Capital 1896.970
High Yield 100, Merrill Lynch 2842.149
Fixed-Rate MBS, Barclays 1950.990
Muni Master, Merrill
514.768
EMBI Global, J.P. Morgan
779.557
26.29
4.65
16.57
15.76
94.40
Currencies
15%
2.25
42.60
14.00
48.65
23.85
166.64
52-Week
Low
% chg
CURRENCIES & COMMODITIES
Yen, euro vs. dollar; dollar vs.
major U.S. trading partners
10
High
* Common stocks priced at $2 a share or more with an average volume over 65 trading days of at least
5,000 shares =Has traded fewer than 65 days
Forex Race
3.00
Latest Session
Close Net chg % chg
Ranked by change from 65-day average*
Symbol
Country/currency
Close
TPR
-29.8
-44.0
78.9
11.6
160.2
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group
Bond total return index
COCP
45,906
45,336
44,772
42,519
41,471
s
3.00
Farmers State Bank
Waterloo, IA
OFIX
NVT
s
4.00
t
VSTO
nVent Electric
FundInvGradeCorpBdPort
PwrSh Russ 1000 Equal Wt
Cmnty Bankers Acqu
iSh Trea Floating Rate Bd
3.75%
Cambridge Savings Bank
2.69%
Cambridge, MA
888-418-5626
FRED
1.89
0.03
52.08 39.79
286.63 235.43
13.48 10.14
33.05 22.07
Compare the performance of selected
global stock indexes, bond ETFs,
currencies and commodities at
WSJ.com/TrackTheMarkets
Tuesday
ARAY
Company
Track the Markets
t
4.50%
2.37%
518-436-9043
GNPX
0.04 -3.19
46.69 -0.49
264.98 0.18
11.26 0.18
29.95 0.10
s
Prime rate
TrustCo Bank
Albany, NY
PETZ
13.3
-5.8
-47.6
20.3
-32.4
* Volumes of 100,000 shares or more are rounded to the nearest thousand
4.22%
NYSE Arca
* 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.
27.59 -10.63 -27.81
4.78 -1.78 -27.10
MTCH 36.71 -10.41 -22.09
GLT
16.78 -4.11 -19.67
IAC
133.33 -28.81 -17.77
76,691
72,241
62,168
56,965
51,033
notes and bonds
Bankrate.com avg†:
Nasdaq
Total volume*1,876,709,680 230,973,844
Adv. volume*1,159,881,857 90,194,882
Decl. volume* 699,430,989 138,381,510
Issues traded
2,940
1,308
Advances
1,676
441
Declines
1,134
851
Unchanged
130
16
New highs
37
4
New lows
91
60
Closing tick
514
43
Closing Arms†
0.89
0.77
Block trades*
7,513
1,244
IVAC
Volume Movers
Volume % chg from Latest Session
Symbol (000) 65-day avg Close % chg
Benchmark
Yields
Treasury
yield
curve
and
Yield toRates
maturity of current bills,
Consumer Rates and Returns to Investor
Symbol
94.86
33.37
29.16
23.18
19.42
Most Active Stocks
Company
Company
4.17 2.03
13.03 3.26
EPIX
4.74 1.07
INGN 173.17 32.59
QTNA
15.13 2.46
I
NMRD
Total volume* 805,870,332 6,861,972
Adv. volume* 357,812,319 3,510,370
Decl. volume* 438,903,203 2,926,355
Issues traded
3,069
323
Advances
1,561
177
Declines
1,385
128
Unchanged
123
18
New highs
34
4
New lows
100
12
Closing tick
461
70
Closing Arms†
1.41
1.07
Block trades*
5,859
84
Percentage Losers
Latest Session
Close Net chg % chg
CREDIT MARKETS
Interest rate
Last
Sources: SIX Financial Information; WSJ Market Data Group
Region/Country Index
EMEA
Eurozone
Belgium
Denmark
France
Germany
Israel
Italy
Netherlands
Russia
South Africa
Spain
Sweden
Switzerland
Turkey
U.K.
U.K.
NYSE NYSE Amer.
4.9
International Stock Indexes
Americas
Brazil
Canada
Mexico
Chile
Volume, Advancers, Decliners
503.24
0.06
Nasdaq PHLX
World
Trading Diary
Most-active and biggest movers among NYSE, NYSE Arca, NYSE Amer.
and Nasdaq issues from 4 p.m. to 6:30 p.m. ET as reported by electronic
trading services, securities dealers and regional exchanges. Minimum
share price of $2 and minimum after-hours volume of 50,000 shares.
589.69
-0.18
21.55
-0.44
Late Trading
.00004393
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
22764
0.2
.04671 21.410
.1610 6.2129
1.1992 .8339
.003820 261.80
.009813 101.91
.1236 8.0900
.2805 3.5652
.01570 63.714
.1130 8.8499
1.0033 .9967
.2437 4.1027
.0381 26.2645
1.3612 .7346
0.6
0.1
0.1
1.1
–1.6
–1.4
2.5
10.5
8.1
2.3
8.1
–6.7
–0.7
Middle East/Africa
Bahrain dinar
Egypt pound
Israel shekel
Kuwait dinar
Oman sul rial
Qatar rial
Saudi Arabia riyal
South Africa rand
2.6522 .3771 –0.01
.0562 17.7845 0.1
.2770 3.6104 3.8
3.3199 .3012 –0.1
2.5967 .3851 0.04
.2743 3.645 –0.1
.2639 3.7892 1.0
.0790 12.6510 2.3
Close Net Chg % Chg YTD%Chg
WSJ Dollar Index 86.13
Tuesday
52-Week
Pricing trends on someClose
raw materials,
or commodities
Net chg % Chg
High
Low
DJ Commodity
TR/CC CRB Index
Crude oil, $ per barrel
Natural gas, $/MMBtu
Gold, $ per troy oz.
649.34
-2.41
201.26
67.25
2.802
1303.80
-0.73
-1.32
0.039
-12.40
0.53 0.62
0.17
Sources: Tullett Prebon, WSJ Market Data Group
-0.37
% Chg
YTD
% chg
658.32
532.01
16.09
3.83
-0.36 202.97
68.64
-1.93
3.63
1.41
-0.94 1362.40
166.50
42.53
2.55
1208.60
11.60
41.10
-12.30
3.88
3.81
11.30
-5.11
-0.19
Get real-time U.S. stock quotes and track most-active stocks, new highs/lows and mutual funds. Plus, deeper money-flows data and email delivery of key stock-market data. Available free at WSJMarkets.com
.
THE WALL STREET JOURNAL.
B10 | Wednesday, May 2, 2018
COMMODITIES
Futures Contracts
Contract
High hilo
Low
Open
Metal & Petroleum Futures
Contract
Open
High hi lo
Low
Settle
Chg
Copper-High (CMX)-25,000 lbs.; $ per lb.
May
3.0485
3.0530
2.9985
3.0150 –0.0375
July
3.0705
3.0850
3.0195
3.0375 –0.0365
Gold (CMX)-100 troy oz.; $ per troy oz.
May
1313.20 1313.80
t 1303.40 1303.80 –12.40
June
1316.00 1317.40
t 1302.30 1306.80 –12.40
Aug
1322.10 1322.80
t 1308.60 1313.00 –12.30
Oct
1327.40 1327.40
t 1314.80 1319.10 –12.50
Dec
1334.90 1334.90
t 1321.50 1325.60 –12.50
Dec'19
1370.00 1370.00
t 1365.20 1365.10 –12.70
Palladium (NYM) - 50 troy oz.; $ per troy oz.
June
959.85
960.10
934.40
936.25 –24.30
Sept
953.65
955.15
932.05
932.50 –23.30
Dec
940.00
950.60
t 933.00
928.00 –23.35
Platinum (NYM)-50 troy oz.; $ per troy oz.
June
899.80
899.80
t 894.40
891.80 –10.20
July
906.80
907.40
t 893.20
894.20 –10.20
Silver (CMX)-5,000 troy oz.; $ per troy oz.
May
16.280
16.285
t 16.000
16.039 –0.273
July
16.345
16.370
t 16.070
16.127 –0.274
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl.
June
68.61
68.90
66.85
67.25 –1.32
July
68.49
68.78
66.77
67.13 –1.35
Sept
67.65
67.90
66.05
66.35 –1.33
Dec
65.91
66.21
64.49
64.76 –1.23
June'19
62.37
62.59
61.24
61.51 –0.92
Dec
59.37
59.60
58.52
58.76 –0.66
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal.
June
2.1486
2.1537
2.0910
2.0997 –.0496
July
2.1438
2.1481
2.0885
2.0965 –.0468
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal.
June
2.1305
2.1320
2.0729
2.0876 –.0432
July
2.1259
2.1285
2.0716
2.0857 –.0411
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu.
June
2.766
2.820
2.759
2.802
.039
July
2.802
2.854
2.795
2.837
.037
Sept
2.793
2.840
2.787
2.823
.033
Oct
2.805
2.853
2.798
2.835
.035
March'19
2.895
2.928
2.895
2.919
.029
April
2.594
2.609
2.593
2.606
.020
Settle
Open
interest
Chg
14.51
15.34 s
14.50
15.11
14.51
15.23
.01
.05
May
July
2,914
2,812
2,914 s
2,906
2,914
2,776
2,914
2,894
69
75
69 136,803
27
4,950
May
July
122.85
122.65
122.85
122.00
122.60
124.80
1.95
146
2.00 145,526
1042.50
1053.25
4.75
7,936
4.75 442,077
June
July
…
11.80
… s
11.80
…
11.52
11.69
11.69
–.06
–.06 535,498
403.00
404.40
10.90
4,110
10.60 259,639
July
Sept
24.81
25.36
24.82
25.37
24.80
25.36
24.80
25.36
–.01
…
t
29.95
30.08
t
30.15
30.33
Rough Rice (CBT)-2,000 cwt.; $ per cwt.
May
1262.00 1262.00
1262.00 1263.50
July
1306.00 1307.50
1287.00 1288.50
Wheat (CBT)-5,000 bu.; cents per bu.
May
511.25
529.75 s
510.25
529.75
July
512.50
530.00
506.00
529.25
Wheat (KC)-5,000 bu.; cents per bu.
May
520.00
530.25
513.00
532.25
July
540.00
554.00
529.75
553.00
Wheat (MPLS)-5,000 bu.; cents per bu.
625.00
627.25
625.00
627.25
May
July
616.00
624.00
610.00
623.50
Cattle-Feeder (CME)-50,000 lbs.; cents per lb.
May
140.275 140.500
137.325 137.900
Aug
146.650 146.650
143.150 143.475
Cattle-Live (CME)-40,000 lbs.; cents per lb.
106.300 106.400
103.825 105.825
June
Aug
104.675 104.925
102.975 104.075
Hogs-Lean (CME)-40,000 lbs.; cents per lb.
May
66.475
67.775
66.300
67.450
June
73.300
74.275
72.975
73.900
Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft.
May
577.20
596.80 s
577.20
591.80
July
564.20
572.10 s
563.30
572.10
–.27
2,585
–.29 267,328
May
July
84.66
83.88
85.30
84.69
84.66
83.61
85.12
84.48
May
July
157.70
155.15
157.70
154.85
157.55
158.00
May
July
393.00
401.00
May
July
226.00
236.00
May
July
1038.75
1048.75
May
July
392.10
393.90
397.00 s
406.00 s
391.50
399.75
396.75
405.75
4.25
7,765
5.00 816,122
226.00
238.50
226.00
235.50
227.75
237.75
2.25
2.00
Soybeans (CBT)-5,000 bu.; cents per bu.
1044.50
1055.50
1031.25
1041.00
Soybean Meal (CBT)-100 tons; $ per ton.
18,421
4,873
250
404.50 s
406.10 s
391.60
391.50
Soybean Oil (CBT)-60,000 lbs.; cents per lb.
30.49
30.65
May
July
46
74,772
3,915
140,156
534,133
280,424
244,995
289,276
147,571
157,796
151,735
80,319
171,505
80,200
287,827
195,093
137,786
120,469
87,702
88,548
30.49
30.76
–15.00
–18.50
184
6,579
17.25
908
18.75 245,111
13.75
1,189
15.50 132,657
9.50
8.00
342
32,575
–2.275
–2.725
7,656
22,953
–.275 142,034
–.450 94,419
1.150
1.200
3,058
99,326
14.60
10.00
1,483
4,509
Cash Prices | WSJ.com/commodities
Tuesday, May 01, 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.
Tuesday
Tuesday
*16.3800
11905
(U.S.$ equivalent)
Coins,wholesale $1,000 face-a
Energy
0.9100
0.9951
2.750
2.730
2.580
1.860
1.800
1.830
2.670
60.400
12.450
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
Other metals
LBMA Platinum Price PM
*905.0
Platinum,Engelhard industrial
902.0
Platinum,Engelhard fabricated
1002.0
Palladium,Engelhard industrial
957.0
Palladium,Engelhard fabricated
1057.0
Aluminum, LME, $ per metric ton
*2224.0
Copper,Comex spot
3.0150
Iron Ore, 62% Fe CFR China-s
n.a.
Shredded Scrap, US Midwest-s,m
381
Steel, HRC USA, FOB Midwest Mill-s
880
Metals
Fibers and Textiles
Gold, per troy oz
1311.88
1410.27
1307.10
1450.88
*1316.25
*1313.20
1358.45
1371.51
1371.51
1582.89
1283.34
1371.51
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA Gold Price AM
LBMA Gold Price PM
Krugerrand,wholesale-e
Maple Leaf-e
American Eagle-e
Mexican peso-e
Austria crown-e
Austria phil-e
Silver, troy oz.
16.3500
19.6200
16.1350
20.1690
*£11.9300
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA spot price
0.5900
0.8348
*93.70
62.500
6.30
Burlap,10-oz,40-inch NY yd-n,w
Cotton,1 1/16 std lw-mdMphs-u
Cotlook 'A' Index-t
Hides,hvy native steers piece fob-u
Wool,64s,staple,Terr del-u,w
Grains and Feeds
n.a.
115
3.7550
136.2
517.5
268
102
315
2.8525
25.75
7.1475
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
Tuesday
SoybeanMeal,Cent IL,rail,ton48%-u 411.40
Soybeans,No.1 yllw IL-bp,u
10.0900
Wheat,Spring14%-pro Mnpls-u
7.8350
Wheat,No.2 soft red,St.Louis-bp,u
5.2350
Wheat - Hard - KC (USDA) $ per bu-u 5.3400
Wheat,No.1soft white,Portld,OR-u
5.9713
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
201.01
184.26
1.0906
2.3600
160.25
166.00
82.50
3066
1.2214
1.4248
1.1650
16.35
n.a.
63.33
1.0108
0.9312
n.a.
168.88
Fats and Oils
29.5000
0.2300
n.a.
0.2843
0.2400
n.a.
Corn oil,crude wet/dry mill-u,w
Grease,choice white,Chicago-h
Lard,Chicago-u
Soybean oil,crude;Centl IL-u
Tallow,bleach;Chicago-h
Tallow,edible,Chicago-u
KEY TO CODES: A=ask; B=bid; BP=country elevator bids to producers; C=corrected; E=Manfra,Tordella & Brooks; G=ICE; H=Hurley Brokerage; I=Natural Gas Intelligence;
M=monthly; N=nominal; n.a.=not quoted or not available; R=SNL Energy; S=Platts-TSI; T=Cotlook Limited; U=USDA; W=weekly, Z=not quoted. *Data as of 4/30
Source: WSJ Market Data Group
May 1, 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
March index
level
Chg From (%)
Feb. '18March '17
U.S. consumer price index
0.23
0.32
249.554
256.610
All items
Core
2.4
2.1
0.50
0.50
0.25
Treasury bill auction
Australia
1.50
1.50
1.50
1.50
4 weeks
13 weeks
26 weeks
Overnight repurchase
Latest
2.25
2.25
4.75 4.75 4.75 4.00
3.45 3.45 3.45 2.70
1.475 1.475 1.475 1.475
Policy Rates
Euro zone
Switzerland
0.00
0.50
0.00
0.50
0.00
0.50
2.18
0.76
Discount
Prime rates
U.S.
Canada
Japan
1.78
1.84
U.S. government rates
52-Week
High
Low
0.00
0.50
2.25
1.50
Low
1.6500 1.6800 1.7100 0.7000
1.6900 1.6800 1.7000 0.8200
Offer
1.7200 1.7100 1.7200 0.8300
ETF
AlerianMLPETF
CnsmrDiscSelSector
CnsStapleSelSector
EnSelectSectorSPDR
FinSelSectorSPDR
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
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
AMLP
XLY
XLP
XLE
XLF
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
EFA
SCZ
EEM
EZU
EWJ
IBB
MUB
IWF
IWB
IWD
IWO
IWM
IWN
IWV
IWR
IWS
IJK
IVW
IVE
10.17
103.84
50.01
73.36
27.46
82.22
71.89
106.01
103.51
119.18
66.53
56.59
63.19
266.83
187.68
78.16
60.79
105.67
95.88
73.90
51.96
107.11
50.94
12.53
114.58
85.40
109.53
103.46
71.91
41.77
70.49
65.48
46.69
44.20
60.59
104.05
107.79
137.26
147.57
120.10
192.08
154.07
124.53
157.28
206.29
86.73
216.96
156.48
109.55
0.69 –5.7
5.2
0.14
–0.87 –12.1
1.5
–0.61
0.04 –1.6
–0.05 –0.6
–0.46 –5.0
–0.11 –2.9
–0.05 –1.0
–0.12 –2.4
0.7
–0.17
–0.46 –0.5
0.2
–0.21
0.20 –0.8
0.39 –1.1
1.8
0.44
0.23 –0.6
–0.08 –3.3
–0.46 –2.7
1.3
–0.27
–0.15 –1.6
3.9
0.62
0.2
–0.00
0.2
–0.71
–0.27 –5.7
0.07 –2.1
–0.18 –5.7
–0.09 –2.9
–0.11 –0.2
3.3
–1.25
0.3
–0.35
1.5
–0.21
–0.49 –0.9
1.9
–0.29
1.1
–0.08
0.39 –2.5
0.03 –2.7
1.9
0.59
0.22 –0.7
–0.20 –3.4
2.9
0.57
1.1
0.49
0.32 –1.0
0.28 –0.6
0.11 –0.9
–0.12 –2.7
0.5
0.60
2.4
0.66
–0.31 –4.1
Closing Chg YTD
Symbol Price (%) (%)
iShUSPfdStk
iShShortTreaBd
iShTIPSBondETF
iSh1-3YTreasuryBd
iSh7-10YTreasuryBd
iShRussellMCGrowth
PIMCOEnhShMaturity
PwrShQQQ 1
PwrShS&P500EW
PwrShSrLoanPtf
SPDR BlmBarcHYBd
SPDR Gold
SchwabIntEquity
SchwabUS BrdMkt
SchwabUS Div
SchwabUS LC
SPDR DJIA Tr
SPDR S&PMdCpTr
SPDR S&P 500
SPDR S&P Div
TechSelectSector
UtilitiesSelSector
VanEckGoldMiner
VangdInfoTech
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
PFF
SHV
TIP
SHY
IEF
IWP
MINT
QQQ
RSP
BKLN
JNK
GLD
SCHF
SCHB
SCHD
SCHX
DIA
MDY
SPY
SDY
XLK
XLU
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
1.650 1.680 1.720 0.695
1.835 1.830 1.835 0.845
1.990 1.985 1.990 0.975
36.97
110.25
111.79
83.13
101.35
122.19
101.42
162.78
99.89
23.11
35.70
123.71
34.10
64.20
48.22
63.42
240.76
341.71
264.98
90.91
66.28
51.40
22.31
173.02
130.09
165.21
99.71
44.77
45.42
59.07
69.29
54.48
143.21
155.09
82.44
80.39
83.30
121.83
154.03
109.58
76.78
243.44
77.97
77.94
147.90
78.75
54.58
56.68
136.54
73.90
103.42
122.85
125.25
Sugar-World (ICE-US)-112,000 lbs.; cents per lb.
Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb.
Cotton (ICE-US)-50,000 lbs.; cents per lb.
157.70 s
158.90 s
2,799
1,506
.44
35
.64 135,846
Orange Juice (ICE-US)-15,000 lbs.; cents per lb.
2.60
2.30
789
10,077
Interest Rate Futures
Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
June
Sept
143-130 143-200
142-180 142-220
142-310
142-060
143-050
142-100
Treasury Notes (CBT)-$100,000; pts 32nds of 100%
June
Sept
119-175 119-185
119-060 119-060
119-115
119-010
–22.0 821,854
–22.0
8,431
119-120
119-010
–8.0 3,676,657
–8.0 25,766
5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100%
June
Sept
113-147 113-152
113-035 113-035
113-110
113-017
113-112
113-015
–5.0 3,660,688
–4.7 31,537
June
Sept
106-005 106-007
105-250 105-250
105-312
105-245
105-312
105-242
–1.5 2,001,730
–1.7 10,647
2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100%
30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg.
t 98.290
98.295
.002 210,244
t 98.060
98.060 –.005 320,806
10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100%
93.156
93.219
93.000
93.016 –.281 29,348
June
1 Month Libor (CME)-$3,000,000; pts of 100%
...
...
... 98.0825
…
1,533
May
Eurodollar (CME)-$1,000,000; pts of 100%
97.6500 97.6700
97.6450 97.6575 .0075 389,308
May
June
97.6250 97.6500
97.6250 97.6350 .0050 1,697,626
Dec
97.3550 97.3650
97.3450 97.3450 –.0100 2,051,877
Dec'19
97.0200 97.0250
96.9950 96.9950 –.0350 1,989,420
May
July
98.293
98.065
98.295
98.070
Settle
Chg
Open
interest
Currency Futures
Japanese Yen (CME)-¥12,500,000; $ per 100¥
t
May
June
.9155
.9176
.9155
.9180
May
June
.7784
.7797
.7794
.7807
May
June
1.3777
1.3795
1.3777
1.3803
t
June
Sept
1.0133
1.0194
1.0136
1.0218
t
t
.9120
.9125
.9114 –.0044
176
.9134 –.0044 154,401
.7754
.7751
.7785 –.0004
265
.7790 –.0004 114,750
1.3611
1.3618
1.3625 –.0130
989
1.3646 –.0130 188,043
1.0068
1.0158
1.0073 –.0059
1.0156 –.0060
Canadian Dollar (CME)-CAD 100,000; $ per CAD
British Pound (CME)-£62,500; $ per £
Swiss Franc (CME)-CHF 125,000; $ per CHF
Australian Dollar (CME)-AUD 100,000; $ per AUD
t
.7480
.7491
t
.7473
.7491
t
.7482
.7493
t
.7480
.7497
t
.7490
.7504
Mexican Peso (CME)-MXN 500,000; $ per MXN
June
.05304
.05309
.05225
.05243
Sept
.05210
.05233
.05169
.05170
Euro (CME)-€125,000; $ per €
May
1.2088
1.2088
t 1.1997
1.2006
June
1.2118
1.2126
t 1.2023
1.2036
.7541
.7531
.7536
.7533
.7490
May
June
July
Sept
Dec
.7541
.7546
.7542
.7550
.7490
82,911
102
–.0039
885
–.0039 139,139
–.0039
437
–.0038
1,163
–.0038
416
–.00061 215,288
–.00060
1,591
–.0087
1,319
–.0087 493,697
Index Futures
Mini DJ Industrial Average (CBT)-$5 x index
June
Sept
24106
24102
24188
24189
23753
23770
24071
24084
June
2643.30
2656.90
2623.50
2652.20
5.20
June
Sept
2646.25
2654.50
2658.00
2661.75
2623.25
2627.75
2652.25
2656.50
5.25 2,859,811
5.00 91,216
June
1870.80
1882.80
1853.70
1879.00
June
Sept
6606.0
6633.0
6740.0
6760.0
6578.8
6603.0
6692.0
6715.3
June
1544.80
1554.60
1527.20
1552.60
8.80
June
1461.90
1470.90
1461.80
1471.40
2.80
66
June
Sept
91.62
91.22
91.60
91.22
92.26
91.81
.63
.63
31,091
1,417
S&P 500 Index (CME)-$250 x index
Mini S&P 500 (CME)-$50 x index
Mini S&P Midcap 400 (CME)-$100 x index
Mini Nasdaq 100 (CME)-$20 x index
Mini Russell 2000 (ICE-US)-$100 x index
Mini Russell 1000 (ICE-US)-$100 x index
U.S. Dollar Index (ICE-US)-$1,000 x index
92.37 s
91.89 s
–60 100,654
–59
2,327
6.90
72,252
76,312
79.0 225,356
78.8 11,045
9,930
Source: SIX Financial Information
Bonds | WSJ.com/bonds
Tracking Bond Benchmarks
Return on investment and spreads over Treasurys and/or yields paid to investors compared with 52-week
highs and lows for different types of bonds
Total
return
close
YTD total
return (%)
Yield (%)
Latest Low High
Index
1896.97
-2.4
Total
return
close
YTD total
return (%)
Yield (%)
Latest Low High
Index
Mortgage-Backed Bloomberg Barclays
Broad Market Bloomberg Barclays
3.320 2.380 3.340
U.S. Aggregate
U.S. Corporate Indexes Bloomberg Barclays
1950.99
-1.9
Mortgage-Backed
1917.53
-1.8
Ginnie Mae (GNMA) 3.420 2.630 3.480
Fannie mae (FNMA) 3.440 2.670 3.520
3.440 2.660 3.510
2698.28
-3.6
U.S. Corporate
3.980 3.030 3.980
1143.99
-1.9
2564.21
-2.1
Intermediate
3.680 2.530 3.680
1761.88
-1.9
Freddie Mac (FHLMC) 3.450 2.680 3.530
Long term
4.630 3.990 4.640
514.77
-1.4
Muni Master
2.639 1.736 2.653
3675.00 -6.6
551.98
-2.7
Double-A-rated
3.430 2.470 3.430
358.25
-2.0
7-12 year
2.678 1.744 2.702
696.14
-3.4
Triple-B-rated
4.260 3.340 4.260
404.61
-1.8
12-22 year
2.981 2.213 3.004
392.01
-2.1
22-plus year
3.370 2.716 3.411
High Yield Bonds Merrill Lynch
416.04
-0.4
High Yield Constrained 6.322 5.373 6.417
Global Government J.P. Morgan†
Triple-C-rated
9.903 9.607 11.091
541.32
-0.5
2842.15
-0.7
High Yield 100
6.059 4.948 6.319
749.41
-0.7
Canada
2.300 1.570 2.340
377.30
-0.4
Global High Yield Constrained 5.742 4.934 5.755
374.50
1.1
EMU§
1.099 0.956 1.311
Europe High Yield Constrained 2.860 1.897 2.957
712.65
0.3
France
0.890 0.690 1.040
Germany
0.590 0.330 0.740
Japan
0.360 0.350 0.460
1.6
426.91
0.2
306.85
506.10
U.S Agency Bloomberg Barclays
Global Government 1.580 1.300 1.650
-0.2
1616.94
-1.2
U.S Agency
2.800 1.690 2.800
290.46
1451.47
-0.7
10-20 years
2.680 1.510 2.680
559.56
-0.2
Netherlands
0.680 0.460 0.830
-0.7
U.K.
1.620 1.340 1.830
3244.38
-4.2
20-plus years
3.420 2.730 3.460
924.30
2404.11
-2.4
Yankee
3.640 2.610 3.640
779.56
0.6
-3.5
Emerging Markets ** 6.328 5.279 6.328
*Constrained indexes limit individual issuer concentrations to 2%; the High Yield 100 are the 100 largest bonds
** EMBI Global Index
† In local currency § Euro-zone bonds
Sources: Merrill Lynch; Bloomberg Barclays; J.P.Morgan
0.06
0.01
–0.29
–0.04
–0.16
0.38
...
1.14
0.04
...
–0.02
–0.71
–0.26
0.27
–0.54
0.22
–0.32
0.35
0.18
0.03
1.25
–0.31
0.13
1.20
0.12
0.51
–0.40
–0.09
–0.57
–0.56
0.10
–0.37
0.66
0.10
–0.19
–0.19
–0.16
0.20
0.08
–0.27
0.91
0.21
–0.06
–0.08
0.29
–0.15
0.04
–0.23
0.15
–0.05
–0.18
–2.9
0.0
–2.0
–0.9
–4.0
1.3
–0.1
4.5
–1.1
0.3
–2.8
0.0
0.1
–0.5
–5.8
–0.6
–2.7
–1.1
–0.7
–3.8
3.6
–2.4
–4.0
5.0
–2.0
2.7
–2.3
–0.2
–1.1
–0.1
–1.1
–0.4
1.8
0.6
–3.7
–4.1
–4.7
–0.6
–0.5
–1.8
–7.5
–0.8
–1.4
–1.7
0.1
–3.5
0.4
–0.2
–0.5
–0.5
–2.7
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
2.375
2.750
4.188 4.213 4.275 3.253
4.217 4.242 4.304 3.281
10
0.000
France 2 -0.498
0.750
10
0.000
Germany 2 -0.590
0.500
10
Other short-term rates
Week
ago
Latest
52-Week
high
low
Call money
3.50
3.50
3.50
2.75
Commercial paper (AA financial)
2.22
90 days
2.00
2.31
1.01
One month
Three month
Six month
One year
1.90875
2.35375
2.51425
2.76598
1.89826
2.36167
2.51625
2.76875
1.90932
2.36561
2.52175
2.78031
0.98856
1.17122
1.39906
1.69511
-0.401
-0.356
-0.317
-0.244
-0.402
-0.365
-0.321
-0.244
-0.397
-0.356
-0.262
-0.138
-0.420
-0.389
-0.339
-0.263
Euro Libor
One month
Three month
Six month
One year
Euro interbank offered rate (Euribor)
-0.371
-0.329
-0.269
-0.189
One month
Three month
Six month
One year
Latest
-0.372
-0.328
-0.270
-0.189
Value
Traded
-0.366
-0.325
-0.248
-0.121
-0.374
-0.332
-0.279
-0.194
52-Week
High
Low
DTCC GCF Repo Index
Treasury
MBS
1.808 35.900 2.068 0.791
1.812 127.050 1.971 0.794
Open Implied
Settle Change Interest Rate
DTCC GCF Repo Index Futures
Treasury May
Treasury Jun
Treasury Jly
98.200 -0.005 1043 1.800
98.055 unch. 675 1.945
97.935 -0.010 439 2.065
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 March 22, 2018. Other
prime rates aren’t directly comparable; lending
practices vary widely by location; Discount rate
is effective March 22, 2018. DTCC GCF Repo
Index is Depository Trust & Clearing Corp.'s
weighted average for overnight trades in
applicable CUSIPs. Value traded is in billions of
U.S. dollars. Federal-funds rates are Tullett
Prebon rates as of 5:30 p.m. ET. Futures on the
DTCC GCF Repo Index are traded on NYSE Liffe
US.
Sources: Federal Reserve; Bureau of Labor
Statistics; DTCC; SIX Financial Information;
Tullett Prebon Information, Ltd.
l
l
l
l
0.789
l
l
0.561
l
Italy 2 -0.311
10
l
1.782
l
0.100
1.400
Spain 2 -0.350
1.400
10
2.000
U.K. 2
4.250
10
Yield (%)
3 4 Previous
2
l
Japan 2 -0.142 t
10 0.040 t
0.100
1
2.052 t
2.768 t
Australia 2
2.000
0
U.S. 2 2.512 s
10 2.973 s
4.500
0.050
30 days
60 days
Latest(l)-2 -1
2.250
30-year mortgage yields
Libor
Largest 100 exchange-traded funds, latest session
ETF
Coffee (ICE-US)-37,500 lbs.; cents per lb.
Fannie Mae
Effective rate 1.7200 1.7100 1.7200 0.8600
High
1.9500 1.9000 1.9500 1.0625
Bid
—52-WEEK—
High Low
Secondary market
Federal funds
Exchange-Traded Portfolios | WSJ.com/ETFresearch
Tuesday, May 1, 2018
Closing Chg YTD
Symbol Price (%) (%)
Week
Latest ago
0.50
International rates
Week
ago
—52-WEEK—
High Low
Britain
U.S.
Cocoa (ICE-US)-10 metric tons; $ per ton.
3,310
3,955
Contract
High hilo
Low
Open
Global Government Bonds: Mapping Yields
Borrowing Benchmarks | WSJ.com/bonds
Money Rates
Inflation
Open
interest
Chg
14.51
15.16
Oats (CBT)-5,000 bu.; cents per bu.
384
346,862
73,366
9,055
59,780
3,519
Settle
April
May
Corn (CBT)-5,000 bu.; cents per bu.
5,243
128,619
Contract
High hilo
Low
Open
Milk (CME)-200,000 lbs., cents per lb.
Agriculture Futures
Open
interest
WSJ.com/commodities
l
l
l
1.278
l
0.788 s
1.406 t
l
l
Month ago
Year ago
2.492
2.953
2.266
2.739
1.282
2.320
2.055
2.024
1.673
2.780
2.608
2.581
-0.498
-0.499
Spread Under/Over U.S. Treasurys, in basis points
Latest
Prev
Year ago
-43.7
-46.0
39.1
-20.6
-17.2
26.1
-0.457 -301.0
0.841
-218.5
-299.0
-173.8
-216.4
-147.9
0.789
0.721
-0.590
-0.610
0.561
0.498
-0.727 -310.3
0.323
-241.2
-0.311
-0.326
-0.082
1.782
1.792
2.282
-0.136
-0.136
-0.204
-282.3
-119.1
-265.4
-308.2
-200.9
-239.1
-199.7
-280.3
-136.4
-117.1
-3.8
-262.8
-148.6
0.056
0.048
0.016
-293.3
-289.6
-230.5
-0.350
-0.350
-0.244
-286.3
-284.2
-152.5
1.278
1.163
1.635
-169.5
-167.5
-68.5
0.773
0.822
0.074
-172.4
-171.9
-120.8
1.419
1.353
1.088
-156.7
-153.4
-123.2
Source: Tullett Prebon
Corporate Debt
in that same company’s share price.
Investment-grade spreads that tightened the most…
Issuer
Symbol Coupon (%)
Maturity
Citigroup
RBS Capital Trust II
Dell International
Northern Trust
C
RBS
DELL
NTRS
6.300
6.425
8.100
2.375
Xerox
PNC Bank NA
Boardwalk Pipelines
KeyCorp*
XRX
PNC
BWP
KEY
2.800 May 15, ’20
2.150 April 29, ’21
5.950
June 1, ’26
5.100 March 24, ’21
May 15, ’49
Jan. 3, ’34
July 15, ’36
Aug. 2, ’22
Current
Spread*, in basis points
One-day change
Last week
Stock Performance
Close ($)
% chg
238 –25
173
–19
312 –15
35 –14
253
191
310
46
68.25
…
...
105.91
–0.03
…
...
–0.79
–12
–11
–6
–6
n.a.
n.a.
193
65
32.29
…
10.94
19.91
2.67
…
–3.78
–0.05
219
27
357
n.a.
13.59
124.86
91.84
...
–0.51
–0.20
–1.06
...
12
11
11
11
144
n.a.
239
n.a.
236.67
87.93
36.42
190.39
–0.70
0.95
–0.87
2.88
Bond Price as % of face value
Current
One-day change
Last week
85
46
177
62
…And spreads that widened the most
Deutsche Bank AG*
Chevron
Assurant
Reckitt Benckiser Treasury Services
DB
CVX
AIZ
RBLN
4.500
April 1, ’25
2.419 Nov. 17, ’20
7.000 March 27, ’48
2.750 June 26, ’24
220
31
359
106
Goldman Sachs
Celgene
General Motors
Lam Research
GS
CELG
GM
LRCX
4.250
5.000
5.400
2.800
153
189
252
74
Oct. 21, ’25
Aug. 15, ’45
April 1, ’48
June 15, ’21
18
16
13
13
High-yield issues with the biggest price increases…
Issuer
Symbol
Coupon (%)
Maturity
Intelsat Luxembourg S.A.
Tenet Healthcare
Monitronics International
B&G Foods
INTEL
THC
MONINT
BGS
8.125
6.750
9.125
5.250
June 1, ’23
June 15, ’23
April 1, ’20
April 1, ’25
66.250
100.485
72.250
92.875
Murray Energy
Allison Transmission
Garda World Security
TransDigm
MURREN 11.250
ALSN
5.000
GWCN
8.750
TDG
5.500
April 15, ’21
Oct. 1, ’24
May 15, ’25
Oct. 15, ’20
44.500
99.000
105.250
100.938
3.75
1.51
1.25
1.13
1.00
0.78
0.78
0.69
Stock Performance
Close ($)
% chg
64.000
99.063
75.000
91.750
...
28.52
...
23.00
...
19.13
...
1.10
43.750
98.080
105.000
100.500
...
40.21
...
314.35
...
3.13
...
–1.94
99.750
96.600
68.500
102.125
36.71
…
2.46
…
–22.09
…
1.65
…
n.a.
n.a.
87.520
95.750
...
18.08
8.15
9.28
...
–1.69
–1.81
–0.22
…And with the biggest price decreases
Match Group
CommScope Technologies
Ultra Resources
Interval Acquisition
MTCH
COMM
UPL
ILG
5.000 Dec. 15, ’27
5.000 March 15, ’27
7.125 April 15, ’25
5.625 April 15, ’23
94.500
93.500
65.250
102.375
Iheartcommunications
Diamond Offshore Drilling
Frontier Communications
Gulfport Energy
IHRT
DO
FTR
GPOR
9.000 Sept. 15, ’22
4.875
Nov. 1, ’43
10.500 Sept. 15, ’22
6.375 Jan. 15, ’26
78.250
72.500
87.000
95.000
–3.25
–2.50
–2.06
–1.88
–1.75
–1.53
–1.41
–1.28
*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.
Wednesday, May 2, 2018 | B11
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.
Tuesday, May 1, 2018
A B C
t
s
t
t
t
t
ABB
ABB 23.33
ADT
ADT
8.68
AES
AES 12.21
Aflac
AFL 45.40
AGNC Invt
AGNC 18.86
ANGI Homesvcs ANGI 13.28
Ansys
ANSS 161.11
ASML
ASML 191.44
AT&T
T
32.54
AbbottLabs ABT 58.82
AbbVie
ABBV 102.07
Abiomed
ABMD 310.50
Accenture
ACN 151.92
ActivisionBliz ATVI 67.80
Adient
ADNT 60.79
AdobeSystems ADBE 224.08
AdvanceAuto AAP 115.58
AdvMicroDevices AMD 11.13
Aegon
AEG
7.21
AerCap
AER 51.79
Aetna
AET 178.71
AffiliatedMgrs AMG 164.13
AgilentTechs A
66.24
AgnicoEagle AEM 42.22
AirProducts APD 162.49
AkamaiTech AKAM 70.84
AlaskaAir
ALK 65.44
Albemarle
ALB 97.62
Alcoa
AA
51.99
AlexandriaRlEst ARE 129.41
AlexionPharm ALXN 118.62
Alibaba
BABA 179.50
AlignTech
ALGN 251.34
Alkermes
ALKS 44.67
Alleghany
Y
581.25
Allegion
ALLE 77.14
Allergan
AGN 152.94
AllianceData ADS 203.30
AlliantEnergy LNT 42.82
Allstate
ALL 98.20
AllyFinancial ALLY 26.32
AlnylamPharm ALNY 92.18
Alphabet C GOOG 1037.31
Alphabet A GOOGL 1040.75
Altaba
AABA 69.89
AlticeUSA
ATUS 17.49
Altria
MO 56.03
AlumofChina ACH 13.99
Amazon.com AMZN 1582.26
Ambev
ABEV 6.57
Amdocs
DOX 67.71
Amerco
UHAL 336.22
Ameren
AEE 58.33
AmericaMovil AMX 18.23
AmericaMovil A AMOV 18.04
AmerAirlines AAL 43.36
AEP
AEP 69.44
AmerExpress AXP 98.58
AmericanFin AFG 113.19
AmHomes4Rent AMH 20.25
AIG
AIG 56.31
AmerTowerREIT AMT 135.10
AmerWaterWorks AWK 86.63
Ameriprise AMP 139.05
AmerisourceBrgn ABC 89.20
Ametek
AME 69.26
Amgen
AMGN 169.28
Amphenol
APH 83.94
AnadarkoPetrol APC 66.52
AnalogDevices ADI 88.86
Andeavor
ANDV 133.48
AndeavorLog ANDX 42.77
AB InBev
BUD 97.59
AnnalyCap
NLY 10.34
AnteroResources AR
19.17
Anthem
ANTM 235.53
Aon
AON 142.86
Apache
APA 40.45
ApartmtInv AIV 41.08
ApolloGlbMgmt APO 28.60
0.06
-0.23
-0.03
-0.17
-0.06
-0.08
-0.55
2.99
-0.16
0.69
5.52
9.55
0.72
1.45
-0.50
2.48
1.13
0.25
-0.05
-0.34
-0.34
-0.73
0.50
0.13
0.20
-0.81
0.51
0.66
0.79
4.84
0.99
0.96
1.49
0.40
6.58
-0.04
-0.71
0.25
-0.13
0.38
0.22
-2.35
19.98
22.17
-0.19
-0.41
-0.08
-0.03
16.13
-0.05
0.46
-1.30
-0.29
-0.26
-0.26
0.43
-0.54
-0.17
-0.03
0.05
0.31
-1.26
0.05
-1.16
-1.38
-0.54
-5.20
0.23
-0.80
1.51
-4.84
0.33
-0.01
-0.03
0.17
-0.46
0.39
-0.50
0.48
-0.24
Net
Sym Close Chg
Stock
Net
Sym Close Chg
Stock
t
s
s
s
Apple
AAPL 169.10 3.84
ApplMaterials AMAT 50.91 1.24
Aptargroup ATR 93.54 0.04
Aptiv
APTV 84.53 -0.05
AquaAmerica WTR 35.49 0.34
Aramark
ARMK 37.43 0.04
ArcelorMittal MT
33.17 -0.67
ArchCapital ACGL 80.63 0.50
ArcherDaniels ADM 45.03 -0.35
Arconic
ARNC 17.68 -0.13
AristaNetworks ANET 265.27 0.72
ArrowElec
ARW 75.80 1.06
AspenTech AZPN 88.02 0.27
AstraZeneca AZN 36.14 0.61
Athene
ATH 49.29 0.29
Atlassian
TEAM 56.24 0.26
AtmosEnergy ATO 86.83 -0.06
Autodesk
ADSK 127.06 1.16
Autohome
ATHM 97.50 -0.05
Autoliv
ALV 135.07 1.02
ADP
ADP 118.80 0.72
AutoZone
AZO 632.16 7.64
Avalonbay
AVB 164.55 1.55
Avangrid
AGR 53.09 0.38
AveryDennison AVY 105.47 0.66
AveXis
AVXS 216.56 3.90
AxaltaCoating AXTA 31.65 0.75
BB&T
BBT 53.07 0.27
BCE
BCE 42.36 -0.09
BHPBilliton BHP 46.30 -0.45
BHPBilliton BBL 41.64 -0.70
BOK Fin
BOKF 100.90 0.22
BP
BP
44.80 0.21
BRF
BRFS 7.23 0.10
BT Group
BT
16.87 -0.38
BWX Tech
BWXT 66.94 -0.86
Baidu
BIDU 252.13 1.23
BakerHughes BHGE 35.64 -0.47
Ball
BLL 39.26 -0.83
BancoBilbaoViz BBVA 7.97 -0.09
BancodeChile BCH 98.37 0.37
BancoMacro BMA 94.86 -2.06
BcoSantChile BSAC 32.94 -0.09
BcoSantMex BSMX 7.33
...
BancoSantander SAN
6.46 -0.06
BanColombia CIB
47.32 -0.34
BankofAmerica BAC 29.95 0.03
BankofMontreal BMO 75.98 0.05
BankNY Mellon BK
54.19 -0.32
BkNovaScotia BNS 61.36 -0.10
BankofOzarks OZRK 47.16 0.36
Barclays
BCS 11.41 -0.13
BarrickGold ABX 13.44 -0.03
BaxterIntl
BAX 70.15 0.65
BectonDicknsn BDX 233.71 1.84
BeiGene
BGNE 171.11 1.53
Berkley
WRB 74.97 0.41
BerkHathwy B BRK.B 195.11 1.38
BerkHathwy A BRK.A 2927302080.00
BerryGlobal BERY 54.96 -0.04
BestBuy
BBY 75.38 -1.15
Bio-RadLab B BIO.B 251.65 -10.00
Bio-RadLab A BIO 253.25 -0.46
Biogen
BIIB 274.61 1.01
BioMarinPharm BMRN 86.16 2.65
BlackKnight BKI
48.90 0.25
BlackBerry
BB
10.53 0.06
BlackRock
BLK 517.97 -3.53
Blackstone
BX
31.10 0.15
BlockHR
HRB 27.70 0.05
bluebirdbio BLUE 176.45 6.30
Boeing
BA 329.54 -4.02
BookingHldgs BKNG 2179.39 1.39
BoozAllen
BAH 39.44 -0.19
BorgWarner BWA 48.54 -0.40
BostonProps BXP 122.67 1.26
BostonSci
BSX 29.48 0.76
Braskem
BAK 25.55 -0.35
BrighthouseFin BHF 50.88 0.10
Bristol-Myers BMY 52.69 0.56
BritishAmTob BTI
52.95 -1.67
Broadcom
AVGO 230.38 0.96
BroadridgeFinl BR 108.01 0.80
Net
Sym Close Chg
Stock
BrookfieldMgt BAM 39.28
BrookfieldInfr BIP
40.53
Brown&Brown BRO 27.22
Brown-Forman B BF.B 55.49
Brown-Forman A BF.A 52.83
BuckeyePtrs BPL 41.89
Bunge
BG
71.64
BurlingtonStrs BURL 135.37
CA
CA
34.97
CBD Pao
CBD 21.96
CBRE Group CBRE 45.80
CBS B
CBS 49.61
CBS A
CBS.A 49.76
CDK Global CDK 65.25
CDW
CDW 72.37
CF Industries CF
38.67
CGI Group
GIB
57.88
CH Robinson CHRW 90.65
CIT Group
CIT
52.87
CME Group CME 156.50
CMS Energy CMS 47.05
CNA Fin
CNA 50.47
CNOOC
CEO 167.81
CPFLEnergia CPL 13.70
CRH
CRH 35.29
CSX
CSX 59.85
CVS Health CVS 68.00
CabotOil
COG 23.97
CadenceDesign CDNS 40.34
CaesarsEnt CZR 11.70
CamdenProperty CPT 86.24
CampbellSoup CPB 40.95
CIBC
CM
87.15
CanNtlRlwy CNI
76.22
CanNaturalRes CNQ 35.81
CanPacRlwy CP 178.95
Canon
CAJ 34.40
CapitalOne COF 89.67
CardinalHealth CAH 63.60
Carlisle
CSL 107.32
Carlyle
CG
20.60
CarMax
KMX 63.54
Carnival
CCL 64.11
Carnival
CUK 65.27
Caterpillar
CAT 144.42
CboeGlobalMkts CBOE 107.29
Celanese A CE 105.42
Celgene
CELG 87.93
Cemex
CX
6.07
CenovusEnergy CVE 10.06
Centene
CNC 108.77
CenterPointEner CNP 25.44
CentraisElBras EBR
5.44
CenturyLink CTL 18.49
Cerner
CERN 58.81
CharterComms CHTR 279.40
CheckPoint CHKP 98.48
Chemours
CC
48.25
CheniereEnergy LNG 58.73
CheniereEnerPtrs CQP 31.05
CheniereEnHldgs CQH 28.24
Chevron
CVX 124.86
ChinaEastrnAir CEA 40.78
ChinaLifeIns LFC 14.10
ChinaLodging HTHT 141.38
ChinaMobile CHL 47.39
ChinaPetrol SNP 96.85
ChinaSoAirlines ZNH 54.02
ChinaTelecom CHA 48.34
ChinaUnicom CHU 14.02
Chipotle
CMG 426.01
Chubb
CB 135.93
ChunghwaTel CHT 37.84
Church&Dwight CHD 46.30
Cigna
CI
171.07
CimarexEnergy XEC 99.84
CincinnatiFin CINF 71.18
Cintas
CTAS 172.34
CiscoSystems CSCO 44.83
Citigroup
C
68.25
CitizensFin CFG 40.95
CitrixSystems CTXS 104.71
Clorox
CLX 116.82
t
t
t
s
-0.36
-0.33
-0.01
-0.55
-0.54
0.34
-0.59
-0.48
0.17
-0.38
0.49
0.41
0.27
0.01
1.08
-0.13
-0.02
-1.38
-0.08
-1.18
-0.14
0.01
-1.20
0.01
-0.07
0.46
-1.83
0.06
0.28
0.35
0.84
0.17
0.10
-1.06
-0.27
-3.49
0.09
-0.95
-0.57
-0.41
0.10
1.04
1.05
0.62
0.06
0.51
-3.25
0.83
-0.14
0.03
0.19
0.11
-0.07
-0.09
0.56
8.11
1.97
-0.16
0.57
-0.21
0.34
-0.25
0.12
...
1.72
-0.07
-0.69
-0.04
0.14
-0.01
2.68
0.26
-0.15
0.10
-0.75
-0.75
0.84
2.04
0.54
-0.02
-0.32
1.80
-0.38
BANKRATE.COM® MMA, Savings and CDs
Average Yields of Major Banks
Type
Tuesday, May 01, 2018
MMA
1-MO
2-MO
3-MO
6-MO
1-YR
2-YR
2.5YR
5YR
0.17
0.31
0.07
0.07
0.07
0.08
0.17
0.19
0.25
0.27
0.44
0.47
0.61
0.65
0.56
0.61
1.11
1.17
0.01
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
-0.01
-0.01
-0.01
-0.01
-0.02
-0.02
0.01
0.01
National average
Savings
Jumbos
Weekly change
Savings
Jumbos
Consumer Savings Rates
Explanation of ratings: Safe Sound SM, (855) 733-0700, evaluates the financial condition of federally insured institutions and assigns a rank of 1,2,3,4 or 5 based on data from the fourth quarter
of 2015 from federal regulators. 5: most desirable performance; NR: institution is too new to rate,
not an indication of financial strength or weakness. Information is believed to be reliable, but not
guaranteed.
Net
Sym Close Chg
Stock
Net
Sym Close Chg
Stock
Coca-Cola
KO
42.59 -0.62 FirstRepBank FRC 93.48 0.61
Coca-Cola Euro CCE 38.57 -0.63 FirstSolar
FSLR 67.51 -3.40
t Coca-Cola Femsa KOF 64.14 -0.58 FirstEnergy FE
33.88 -0.52
t Cognex
CGNX 46.10 -0.15 Fiserv
FISV 71.63 0.77
CognizantTech CTSH 81.82
... FleetCorTech FLT 210.35 3.07
t ColgatePalm CL
65.00 -0.23 Flex
FLEX 13.69 0.69
ColumbiaSportswr COLM 82.82 -0.19 FlirSystems FLIR 53.60 0.05
t Comcast A CMCSA 32.06 0.67 Flowserve
FLS 44.74 0.33
Comerica
CMA 94.85 0.27 Fluor
FLR 59.04 0.09
CommerceBcshrs CBSH 63.80 0.28 FomentoEconMex FMX 95.31 -1.35
t CommScope COMM 27.59 -10.63 FordMotor
F
11.26 0.02
SABESP
SBS
9.95 -0.03 Fortinet
FTNT 55.74 0.38
ConagraBrands CAG 36.56 -0.51 Fortis
FTS 33.51 0.02
ConchoRscs CXO 157.03 -0.18 Fortive
FTV 72.04 1.73
ConocoPhillips COP 65.71 0.21 t FortBrandsHome FBHS 55.74 1.05
ConEd
ED
79.95 -0.18 Franco-Nevada FNV 71.45 0.49
ConstBrands A STZ 229.68 -3.45 FranklinRscs BEN 33.03 -0.61
ContinentalRscs CLR 65.72 -0.34 FreeportMcM FCX 14.95 -0.26
Cooper
COO 230.09 1.38 FreseniusMed FMS 50.58 0.01
Copart
CPRT 51.66 0.58
Corning
GLW 26.82 -0.20
CoStar
CSGP 368.98 2.32
GGP 19.93 -0.06
Costco
COST 196.55 -0.61 GGP
AJG 69.91 -0.08
Coty
COTY 16.90 -0.45 Gallagher
Credicorp
BAP 229.42 -3.07 Gaming&Leisure GLPI 34.36 0.09
GPS 28.85 -0.39
CreditAcceptance CACC 335.96 5.12 Gap
CreditSuisse CS
16.68 -0.09 GardnerDenver GDI 31.16 -0.47
Garmin
GRMN 58.99 0.32
CrownCastle CCI 100.86 -0.01
IT
122.01 0.72
t CrownHoldings CCK 48.28 -1.56 Gartner
Gazit-Globe
GZT
9.56 0.12
Ctrip.com
CTRP 41.46 0.56
Cullen/Frost CFR 115.96 1.51 GeneralDynamics GD 197.30 -4.01
GeneralElec
GE
14.05
-0.02
t Cummins
CMI 153.28 -6.58
GeneralMills GIS
43.55 -0.19
GeneralMotors GM
36.42 -0.32
Genpact
G
31.81 -0.08
DCT Industrial DCT 66.25 0.68 Gentex
GNTX 22.60 -0.14
t DISH Network DISH 33.43 -0.12 GenuineParts GPC 88.68 0.36
DTE Energy DTE 105.00 -0.40 Gerdau
GGB
4.58 -0.09
DXC Tech
DXC 102.78 -0.28 Gildan
GIL
29.29 0.16
Danaher
DHR 100.89 0.57 GileadSciences GILD 72.56 0.33
Darden
DRI 93.30 0.44 GSK
GSK 40.04 -0.07
DaVita
DVA 63.12 0.33 GlobalPayments GPN 113.33 0.28
Deere
DE 135.37 0.04 GoDaddy
GDDY 64.03 -0.53
DellTechs
DVMT 71.41 -0.36 Goldcorp
GG
13.35 0.06
DeltaAir
DAL 52.74 0.52 GoldmanSachs GS 236.67 -1.66
DentsplySirona XRAY 50.64 0.30 t Goodyear
GT
25.40 0.29
DeutscheBank DB
13.59 -0.07 Graco
GGG 44.36 0.37
DevonEnergy DVN 36.20 -0.13 Grainger
GWW 281.94 0.59
DexCom
DXCM 73.39 0.21 GreatPlainsEner GXP 32.66 -0.07
Diageo
DEO 141.81 -0.15 Grifols
GRFS 20.34 0.02
DiamondbkEner FANG 128.10 -0.35 GrubHub
GRUB 92.65 -8.49
DigitalRealty DLR 105.01 -0.68 GpoAeroportuar PAC 102.01 -2.16
DiscoverFinSvcs DFS 70.52 -0.73 GpoAvalAcc AVAL 8.86
...
DiscoveryB DISCB 32.35 -5.65 GpoFinGalicia GGAL 61.61 -2.31
DiscoveryA DISCA 24.01 0.36 GrupoTelevisa TV
17.84 -0.08
DiscoveryC DISCK 22.55 0.33 Guidewire
GWRE 85.63 1.01
Disney
DIS 100.06 -0.27 HCA Healthcare HCA 96.20 0.46
DocuSign
DOCU 39.45 0.82 HCP
HCP 23.67 0.31
DolbyLab
DLB 60.62 0.80 HDFC Bank HDB 95.97 0.16
DollarGeneral DG
96.54 0.01
HD Supply
HDS 38.41 -0.30
DollarTree
DLTR 95.93 0.04 HP
HPQ 21.82 0.33
DominionEner D
66.27 -0.29
HSBC
HSBC 50.13 -0.13
Domino's
DPZ 247.68 5.95
Halliburton HAL 52.44 -0.55
Donaldson
DCI
44.33 0.07
Hanesbrands HBI 17.73 -0.74
DouglasEmmett DEI
37.92 0.65
t HarleyDavidson HOG 40.73 -0.40
Dover
DOV 91.85 -0.85
Harris
HRS 151.78 -4.64
DowDuPont DWDP 63.06 -0.18
HartfordFinl HIG 53.90 0.06
DrPepperSnap DPS 120.11 0.15
Hasbro
HAS 87.39 -0.70
Dropbox
DBX 30.90 0.79
Heico A
HEI.A 72.20 0.05
DukeEnergy DUK 79.83 -0.33
Heico
HEI
87.07 -0.78
DukeRealty DRE 27.73 0.63
Helm&Payne HP
68.90 -0.65
ENI
E
38.77 -0.40
HenrySchein HSIC 76.87 0.87
EOG Rscs
EOG 117.56 -0.61
t Hershey
HSY 91.32 -0.62
EPAM Systems EPAM 114.98 0.63
HES 57.65 0.66
EQT
EQT 50.22 0.03 Hess
E*TRADE
ETFC 61.04 0.36 HewlettPackard HPE 17.18 0.13
Hexcel
HXL 66.20 -0.27
EXACT Sci
EXAS 50.02 0.01
HRC 86.40 0.57
EastWestBncp EWBC 67.59 0.97 Hill-Rom
Hilton
HLT 80.24 1.40
EastmanChem EMN 102.14 0.06
Eaton
ETN 73.86 -1.17 HollyFrontier HFC 60.46 -0.23
Hologic
HOLX 39.63 0.84
EatonVance EV
53.80 -0.59
eBay
EBAY 37.83 -0.05 HomeDepot HD 184.63 -0.17
HondaMotor
HMC
33.91 -0.45
Ecolab
ECL 147.13 2.36
HON 144.51 -0.17
Ecopetrol
EC
21.71 -0.37 Honeywell
HormelFoods
HRL
36.12 -0.13
EdisonInt
EIX
65.52
...
DHI 44.24 0.10
EdwardsLife EW 132.59 5.23 DR Horton
HostHotels
HST
19.53
-0.03
ElectronicArts EA 119.83 1.85
EmersonElec EMR 68.98 2.57 HowardHughes HHC 137.21 1.91
HuanengPower
HNP
26.12
...
Enbridge
ENB 30.62 0.35
HUBB 102.51 -1.35
Encana
ECA 12.57 0.09 t Hubbell
Humana
HUM
295.19
1.01
EncompassHealth EHC 61.59 0.77
JBHT 115.92 -1.51
EnelAmericas ENIA 11.24 -0.11 JBHunt
EnelChile
ENIC 6.17 -0.05 HuntingtonBcshs HBAN 14.81 -0.10
EnelGenChile EOCC 23.87 0.03 HuntingIngalls HII 234.72 -8.49
HUN 29.03 -0.74
Energen
EGN 65.00 -0.44 Huntsman
76.93 0.06
EnergyTransferEq ETE 15.86 0.06 HyattHotels H
EnergyTransfer ETP 18.14 0.12 IAC/InterActive IAC 133.33 -28.81
ICICI
Bank
IBN
8.44 -0.07
Entergy
ETR 81.23 -0.36
IDXX 195.06 0.57
EnterpriseProd EPD 26.75 -0.09 IdexxLab
IHSMarkit
INFO
49.41
0.28
Equifax
EFX 113.03 0.98
ING 16.71 -0.08
Equinix
EQIX 423.03 2.24 ING Groep
t
Invesco
IVZ
28.44
-0.53
EquityLife
ELS 89.65 0.49
EquityResdntl EQR 62.22 0.51 IPG Photonics IPGP 233.29 20.26
IQV 97.99 2.23
EssexProp
ESS 240.86 1.17 IQVIA
IRCP 44.10 -1.39
EsteeLauder EL 144.93 -3.16 IRSA Prop
s
IcahnEnterprises
IEP
67.60 2.45
EverestRe
RE 232.90 0.23
ICLR 118.73 1.10
EversourceEner ES
59.75 -0.50 Icon
IEX 133.34 -0.32
Exelixis
EXEL 21.00 0.18 IDEX
Exelon
EXC 40.15 0.47 IllinoisToolWks ITW 144.00 1.98
ILMN 242.99 2.06
Expedia
EXPE 113.50 -1.64 Illumina
IMO 30.60 -0.53
ExpeditorsIntl EXPD 64.07 0.21 ImperialOil
INCY 60.85 -1.09
ExpressScripts ESRX 75.87 0.17 t Incyte
INFY 17.64 -0.03
s ExtraSpaceSt EXR 90.41 0.82 Infosys
85.93 2.04
ExxonMobil XOM 76.95 -0.80 Ingersoll-Rand IR
INGR 120.65 -0.44
s F5Networks FFIV 164.67 1.58 Ingredion
INTC 53.33 1.71
FMC
FMC 79.81 0.08 Intel
Facebook
FB 173.86 1.86 InteractiveBrkrs IBKR 74.05 -0.15
ICE
72.34 -0.12
FactSet
FDS 188.66 -0.45 ICE
Fastenal
FAST 49.36 -0.63 InterContinentl IHG 63.85 0.21
IBM 145.00 0.04
FederalRealty FRT 117.44 1.59 IBM
IFF 142.06 0.80
FedEx
FDX 244.66 -2.54 IntlFlavors
27.94 -0.33
Ferrari
RACE 122.48 -0.20 IntlGameTech IGT
IP
51.11 -0.45
FiatChrysler FCAU 21.91 0.08 IntlPaper
IPG
23.42 -0.17
FibriaCelulose FBR 19.44 -0.12 Interpublic
INTU 187.24 2.45
FidNatlFin
FNF 37.21 0.38 Intuit
FidNatlInfo
FIS 99.66 4.69 IntuitiveSurgical ISRG 447.55 6.77
FifthThirdBncp FITB 33.36 0.19 InvitatHomes INVH 23.30 0.16
IQ
17.60 -0.43
FirstAmerFin FAF 51.88 0.77 iQIYI
FirstData
FDC 18.24 0.14 IronMountain IRM 34.12 0.18
4.48 0.02
FirstHorizonNatl FHN 18.41 0.11 IsraelChemicals ICL
Mutual Funds
Minimum
Yield
(%)
Money market and savings account
DollarSavingsDirect /4
(866) 395-8693
VirtualBank /4
(877) 998-2265
CIT Bank /5
(855) 462-2652
$1
1.80
$100
1.77
$100
1.75
One-month CD
Minimum
Yield
(%)
Six-month CD
AloStar, a division of State Bank /5 $1,000
(877) 738-6391
MyeBanc,ADivisionofBACFloridaBank/4 $5,000
(855) 512-0989
TAB Bank /5
$1,000
(800) 837-4136
1.90
1.85
t
t
t
0.83
0.30
0.15
Two-month CD
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
M.Y. Safra Bank, FSB /NR $5,000
(212) 652-7200
Goldwater Bank /NR
$5,000
(480) 281-8200
2.22
2.21
2.20
Two-year CD
$10,000
0.15
$1,000
0.05
Three-month CD
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
M.Y. Safra Bank, FSB /NR $5,000
(212) 652-7200
Luana Savings Bank /5
$1,000
(800) 666-2012
Colorado Federal Savings Bank /4 $5,000
(877) 484-2372
MyeBanc,ADivisionofBACFloridaBank/4 $5,000
(855) 512-0989
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
2.51
2.50
2.48
Five-year CD
1.56
1.55
1.51
M.Y. Safra Bank, FSB /NR $5,000
(212) 652-7200
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
Goldman Sachs Bank USA /5
$500
(855) 730-7283
2.88
2.84
2.80
High yield jumbos - Minimum is $100,000
Money market and savings account
VirtualBank /4
(877) 998-2265
BBVA Compass /3
(800) COMPASS
Discover Bank /5
(877) 505-4051
1.77
1.40
1.40
One-month CD
EH National Bank /5
(888) 392-5265
M.Y. Safra Bank, FSB /NR
(212) 652-7200
USAA /NR
(800) 583-8295
0.30
0.22
Two-month CD
VirtualBank /4
(877) 998-2265
Applied Bank /5
(800) 616-4605
Citizens Trust Bank /4
(404) 659-5959
1.81
1.81
First Internet Bank of Indiana /4
(888) 873-3424
M.Y. Safra Bank, FSB /NR
(212) 652-7200
Colorado Federal Savings Bank /4
(877) 484-2372
2.22
2.21
2.20
Two-year CD
0.15
0.05
0.01
Three-month CD
Luana Savings Bank /5
(800) 666-2012
First Internet Bank of Indiana /4
(888) 873-3424
M.Y. Safra Bank, FSB /NR
(212) 652-7200
1.85
One-year CD
0.84
Colorado Federal Savings Bank /4
(877) 484-2372
MyeBanc,ADivisionofBACFloridaBank/4
(855) 512-0989
First Internet Bank of Indiana /4
(888) 873-3424
2.51
2.50
2.48
Five-year CD
1.66
1.56
1.55
M.Y. Safra Bank, FSB /NR
(212) 652-7200
First Internet Bank of Indiana /4
(888) 873-3424
Colorado Federal Savings Bank /4
(877) 484-2372
+0.23
t
T U V
t
R S
t
t
+0.09
-0.01
+0.01
-0.03
-0.10
+0.04
-0.15
+0.15
+0.21
-0.01
+0.13
-0.04
+0.06
+0.28
-0.11
+0.14
...
+0.02
Tuesday, May 1, 2018
Net YTD
NAV Chg % Ret Fund
AggBdInst
10.52
4.9 CorBdInst
10.86
BlackRock Funds A
4.6 GlblAlloc p
19.50
-1.6 BlackRock Funds Inst
-0.9 EqtyDivd
22.49
-2.4 GlblAlloc
19.63
-2.7 StratIncOpptyIns 9.86
1.8 Bridge Builder Trust
0.9 CoreBond
NA
-0.1 Dimensional Fds
4.9 5GlbFxdInc
10.82
... EmgMktVa
31.93
-0.1 EmMktCorEq 23.24
-2.0 IntlCoreEq
14.58
2.9 IntlVal
20.66
6.3 IntSmCo
NA
0.4 IntSmVa
22.78
1.8 US CoreEq1
22.70
-1.4 US CoreEq2
21.36
-0.4 US Small
35.76
US SmCpVal 37.57
Fund
Net YTD
NAV Chg % Ret
24.58 +0.04
-0.02 -2.4 US TgdVal
38.12 +0.03
-0.03 -2.3 USLgVa
Dodge & Cox
103.99 +0.09
-0.01 -1.0 Balanced
13.58
...
GblStock
13.44 -0.01
... -0.8 Income
45.82 -0.17
-0.01 -0.9 Intl Stk
198.79 +0.27
... 0.1 Stock
DoubleLine Funds
... NA CoreFxdIncmI 10.70 -0.01
10.39 -0.01
TotRetBdI
... -0.5 Edgewood Growth Instituti
-0.11 2.3 EdgewoodGrInst 32.18 +0.16
-0.06 0.1 Fidelity
92.83 +0.24
-0.03 0.3 500IdxInst
-0.06 1.0 500IdxInstPrem 92.83 +0.24
... NA 500IdxPrem 92.83 +0.24
-0.12 -0.8 ExtMktIdxPrem r 62.45 +0.21
+0.06 -0.1 IntlIdxPrem r 43.28 -0.19
+0.04 -0.8 SAIUSLgCpIndxFd 14.26 +0.03
76.11 +0.20
+0.14 -0.3 TMktIdxF r
+0.05 -0.9 TMktIdxPrem 76.11 +0.21
-1.1
-2.1
-1.2
-2.0
-1.4
-1.1
-0.9
-1.5
-1.1
8.9
-0.1
-0.1
-0.1
0.7
0.3
-0.1
...
...
2.88
2.84
2.71
Notes: Accounts are federally insured up to $250,000 per person effective Oct. 3, 2008. Yields
are based on method of compounding and rate stated for the lowest required opening deposit to
earn interest. CD figures are for fixed rates only. MMA: Allows six (6) third-party transfers per
month, three (3) of which may be checks. Rates are subject to change.
Source: Bankrate.com, a publication of Bankrate, Inc., North Palm Beach, FL 33408
Internet: www.bankrate.com
Dividend announcements from May 1.
Company
Symbol
Yld %
Amount
New/Old
Frq
Payable /
Record
Increased
Alliance Holdings GP
Alliance Resource Ptrs
Calvert Ultra-Short Incm
Carolina Financial
CoBiz Financial
Eaton Vance FR NextShares
Eaton Vance Oaktree Div
Eaton Vance TABS 5-to-15Y
Kimbell Royalty Partners
Patterson-UTI Energy
Preferred Apt Cmnts
Principal Financial Group
Regal Beloit
Simpson Manufacturing
Westlake Chem Partners
AHGP
ARLP
CRUSC
CARO
COBZ
EVFTC
OKDCC
EVLMC
KRP
PTEN
APTS
PFG
RBC
SSD
WLKP
11.8
11.9
0.2
0.6
2.0
0.4
0.4
0.2
9.4
0.7
7.0
3.6
1.6
1.5
7.1
.7475 /.7425
.515 /.51
.0192 /.0184
.06 /.05
.10 /.055
.0365 /.0325
.0335 /.0287
.0195 /.0161
.42 /.36
.04 /.02
.255 /.25
.52 /.51
.28 /.26
.22 /.21
.3975 /.3864
Q
Q
M
Q
Q
M
M
M
Q
Q
Q
Q
Q
Q
Q
May18 /May11
May15 /May08
May04 /May02
Jul06 /Jun15
May14 /May07
May04 /May02
May04 /May02
May04 /May02
May14 /May07
Jun21 /Jun07
Jul16 /Jun15
Jun29 /Jun04
Jul13 /Jun29
Jul26 /Jul05
May24 /May10
AB
MBFIO
10.8
5.9
.73 /.84
.375 /.3875
Q
Q
May17 /May07
May25 /May10
Reduced
AllianceBernstein
MB Financial Pfd. C
Initial
TriState Cap Pfd. A
.47344
TSCAP
Jul02 /Jun15
Foreign
Lazard
Nordic American Tankers
LAZ
NAT
3.2
2.1
.44
.01
Q
Q
May18 /May07
Jun12 /May24
M
May27 /
Suspended
Pacific Coast Oil Trust
ROYT
Net
Sym Close Chg
M N
Dividend Changes
Six-month CD
MyeBanc,ADivisionofBACFloridaBank/4
(855) 512-0989
Luana Savings Bank /5
(800) 666-2012
First Internet Bank of Indiana /4
(888) 873-3424
American Century Inv
45.56
Ultra
American Funds Cl A
32.94
AmcpA p
39.98
AMutlA p
26.82
BalA p
12.49
BondA p
CapIBA p
60.65
CapWGrA
51.81
EupacA p
56.74
62.00
FdInvA p
51.95
GwthA p
10.18
HI TrA p
40.22
ICAA p
22.73
IncoA p
44.42
N PerA p
47.44
NEcoA p
67.22
NwWrldA
56.81
SmCpA p
TxExA p
12.74
WshA p
45.29
Baird Funds
Stock
-0.53
0.79
-0.06
-0.15
0.09
-0.51
0.35
-0.01
-0.24
0.32
-6.22
0.64
-0.51
...
-0.15
-0.01
0.01
0.05
-0.01
1.10
-0.54
-0.12
0.15
-0.13
0.01
-0.29
2.84
-0.22
0.27
0.80
-0.61
-0.58
-0.90
0.84
0.01
-1.05
-1.36
0.27
-1.64
-1.19
0.45
0.81
-0.48
0.01
-0.42
0.03
0.63
-3.61
-0.30
0.24
-0.21
0.92
-0.06
-0.14
0.80
0.99
0.52
0.24
-0.53
-0.68
-0.20
0.10
-0.01
0.05
...
-0.04
-0.28
2.18
-0.84
0.08
W X Y Z
e-Ex-distribution. f-Previous day’s quotation. g-Footnotes x and s apply. j-Footnotes e and s
apply. k-Recalculated by Lipper, using updated data. p-Distribution costs apply, 12b-1. rRedemption charge may apply. s-Stock split or dividend. t-Footnotes p and r apply. v-Footnotes
x and e apply. x-Ex-dividend. z-Footnote x, e and s apply. NA-Not available due to incomplete
price, performance or cost data. NE-Not released by Lipper; data under review. NN-Fund not
tracked. NS-Fund didn’t exist at start of period.
Net YTD
NAV Chg % Ret Fund
Net
Sym Close Chg
O P Q
Top 250 mutual-funds listings for Nasdaq-published share classes by net assets.
Fund
Stock
MorganStanley MS
51.81 0.19 t RegenPharm REGN 301.22 -2.46 TimeWarner TWX 94.27
TOL 42.95
Mosaic
MOS 26.85 -0.10 RegionsFin RF
18.75 0.05 Toll Bros
TMK 86.68
MotorolaSol MSI 108.48 -1.35 ReinsGrp
RGA 153.02 3.62 Torchmark
s MuleSoft
TTC 58.24
MULE 44.57 -0.01 RelianceSteel RS
87.39 -0.53 t Toro
JD.com
JD
37.47 0.96
56.24
Mylan
MYL 38.78 0.02 RepublicSvcs RSG 64.71 0.03 TorontoDomBk TD
JPMorganChase JPM 108.78
...
TOT 62.10
NICE
NICE 96.84 1.67 ResMed
RMD 95.12 0.48 Total
JackHenry
JKHY 121.43 1.95 NRG Energy NRG 30.65 -0.35
TotalSystem
TSS
84.41
RestaurantBrands QSR 54.03 -0.39
JacobsEngg JEC 58.39 0.30 NVR
NVR 3132.39 32.39 RioTinto
RIO 54.56 -0.39 ToyotaMotor TM 130.97
JamesHardie JHX 17.67 -0.14 NXP Semi
NXPI 103.99 -0.91 RobertHalf RHI 60.77 0.02 TractorSupply TSCO 67.76
JanusHenderson JHG 31.45 -0.14 Nasdaq
NDAQ 89.01 0.69 Rockwell
ROK 167.24 2.71 TransCanada TRP 42.77
JazzPharma JAZZ 154.38 2.34 NationalGrid NGG 58.04 -0.14
TDG 314.35
RockwellCollins COL 132.23 -0.31 TransDigm
JetBlue
JBLU 19.44 0.25 NatlOilwell
NOV 38.51 -0.16 RogersComm B RCI
47.32 0.11 TransUnion TRU 65.55
J&J
JNJ 126.01 -0.48 NatlRetailProp NNN 38.75 0.71
TRV 131.09
Rollins
ROL 48.83 0.31 Travelers
JohnsonControls JCI
35.94 2.07 NektarTherap NKTR 84.12 0.46
TRMB 34.60
RoperTech
ROP 264.77 0.58 Trimble
JonesLang
JLL 171.78 2.27 NetApp
8.50
NTAP 67.85 1.27 RossStores ROST 79.38 -1.47 TurkcellIletism TKC
JuniperNetworks JNPR 24.74 0.15 Netease
2.96
NTES 260.95 3.88 RoyalBkCanada RY
75.99 -0.06 TurquoiseHill TRQ
KAR Auction KAR 51.89 -0.10 Netflix
NFLX 313.30 0.84 RoyalBkScotland RBS
7.43 -0.05 21stCenturyFoxA FOXA 36.57
KB Fin
KB
56.30 -0.10 Neurocrine
NBIX 84.39 3.31 RoyalCaribbean RCL 109.56 1.37 21stCenturyFoxB FOX 36.12
KKR
KKR 21.40 0.46 NewOrientalEduc EDU 91.36 1.52
TWTR 30.30
RoyalDutchA RDS.A 69.05 -0.85 Twitter
KLA Tencor KLAC 102.33 0.59 NewResidInvt NRZ 17.70 0.22
TYL 220.02
RoyalDutchB RDS.B 71.54 -0.88 TylerTech
KT
KT
13.35 -0.08 NY CmntyBcp NYCB 11.86 -0.02
RoyalGold
RGLD 88.84 0.04 TysonFoods TSN 69.56
KSCitySouthern KSU 106.26 -0.37 NewellBrands NWL 27.05 -0.58
Ryanair
RYAAY 112.02 2.05 UBS Group UBS 16.68
Kellogg
K
58.75 -0.15 NewfieldExpln NFX 30.08 0.28
UDR 36.30
SAP
SAP 111.72 0.89 UDR
KeyCorp
KEY 19.91 -0.01 NewmontMin NEM 39.22 -0.07
UGI 48.26
S&P Global SPGI 190.03 1.43 UGI
KeysightTechs KEYS 51.35 -0.33 NewsCorp B NWS 16.20 -0.05
USFD 34.19
SBA Comm SBAC 157.50 -2.73 US Foods
KilroyRealty KRC 72.28 0.61 NewsCorp A NWSA 16.01 0.03
UltaBeauty
ULTA 250.62
SEI Investments SEIC 63.11 -0.12
KimberlyClark KMB 103.21 -0.33 NextEraEnergy NEE 163.22 -0.69
Sina
SINA 95.01 -0.53 UltSoftware ULTI 242.76
KimcoRealty KIM 14.78 0.27 Nike
NKE 68.10 -0.29 SINOPEC
SHI
66.44 0.42 t UltraparPart UGP 17.10
KinderMorgan KMI 16.02 0.20 NiSource
NI
24.52 0.13 SK Telecom SKM 23.87 0.12 UnderArmour A UAA 18.03
Knight-Swift KNX 39.01
... NobleEnergy NBL 33.07 -0.76
SLGreenRealty SLG 98.17 0.43 UnderArmour C UA 16.15
Kohl's
KSS 61.99 -0.13 Nokia
UN
56.51
NOK
5.93 -0.08 SS&C Tech
SSNC 49.99 0.34 Unilever
KoninklijkePhil PHG 42.22
... NomuraHoldings NMR 5.64 -0.09
UL
55.39
s SVB Fin
SIVB 305.46 5.85 Unilever
KoreaElcPwr KEP 17.34 -0.05 Nordson
NDSN 127.49 -1.11 SageTherap SAGE 147.73 3.81 UnionPacific UNP 132.73
KraftHeinz
KHC 55.70 -0.68 Nordstrom
JWN 50.17 -0.39 Salesforce.com CRM 123.11 2.12 UnitedContinental UAL 68.38
Kroger
KR
24.76 -0.43 NorfolkSouthern NSC 142.49 -0.98
SNY 39.13 -0.19 UnitedMicro UMC 2.68
Kyocera
KYO 61.80 -1.78 NorthernTrust NTRS 105.91 -0.84 Sanofi
UPS 112.45
18.48 0.03 UPS B
LATAMAirlines LTM 14.94 -0.33 NorthropGrum NOC 307.22 -14.82 SantanderCons SC
Sasol
SSL 35.17 -0.36 UnitedRentals URI 148.64
L Brands
LB
34.32 -0.59 NorwegCruise NCLH
53.86 0.39 Schlumberger SLB 68.40 -0.16 US Bancorp USB 50.72
LG Display
LPL 10.84 0.04 Novartis
X
32.19
NVS 76.28 -0.41 SchwabC
SCHW 55.61 -0.07 US Steel
LINE
LN
36.48 0.40 NovoNordisk NVO
47.72 0.78 Seagate
STX 54.21 -3.68 UnitedTech UTX 118.96
LKQ
LKQ 30.27 -0.75 Nucor
UnitedHealth
UNH
236.85
NUE 60.36 -1.26 SealedAir
SEE 44.31 0.46
L3 Tech
LLL 186.98 -8.90 Nutanix
NTNX 51.91 1.32 SeattleGenetics SGEN 52.52 1.33 UniversalHealthB UHS 115.01
LabCpAm
LH 170.88 0.13 Nutrien
NTR 45.82 0.29 SemicondctrMfg SMI
6.45 -0.03 UnumGroup UNM 47.90
LamResearch LRCX 190.39 5.33 NVIDIA
VER
6.81
NVDA 227.14 2.24 SempraEnergy SRE 111.66 -0.14 VEREIT
LamarAdv
LAMR 64.69 0.98
VFC 80.45
ServiceCorp SCI
36.30 -0.21 VF
LambWeston LW
64.97 -0.35
VICI Prop
VICI 18.21
ServiceMaster
SERV
53.55
2.95
LasVegasSands LVS 74.86 1.53
Visa
V
127.51
Lazard
LAZ 55.06 0.64 OGE Energy OGE 32.83 -0.04 ServiceNow NOW 165.42 -0.72 VailResorts MTN 225.70
OKE 60.49 0.27 ShawComm B SJR 20.59 0.02 Vale
Lear
LEA 187.66 0.69 ONEOK
VALE 13.54
Leidos
LDOS 63.48 -0.75 OReillyAuto ORLY 258.76 2.69 SherwinWilliams SHW 373.82 6.16 ValeantPharm VRX 18.31
Lennar B
LEN.B 43.44 0.75 OccidentalPetrol OXY 76.58 -0.68 ShinhanFin SHG 44.06 -0.56 ValeroEnergy VLO 110.72
Shire
SHPG
159.50
0.07
Lennar A
LEN 53.91 1.02 OldDomFreight ODFL 131.75 -2.11
VAR 116.51
SHOP 127.68 -5.95 VarianMed
20.47 0.07 Shopify
LennoxIntl
LII
196.53 3.16 OldRepublic ORI
Vectren
VVC 70.21
OMC 74.22 0.56 SignatureBank SBNY 130.32 3.17 Vedanta
LeucadiaNatl LUK 24.06 0.02 Omnicom
VEDL 17.58
ON
22.16 0.08 SimonProperty SPG 159.74 3.40 VeevaSystems VEEV 70.93
LibertyBroadbandA LBRDA 71.59 1.11 ON Semi
SiriusXM
SIRI
6.32
-0.01
OTEX 35.83 0.50
LibertyBroadbandC LBRDK 72.44 1.55 OpenText
Ventas
VTR
52.41
SWKS 90.90 4.14
ORCL 45.95 0.28 Skyworks
LibertyGlobal A LBTYA 29.88 -0.26 Oracle
VRSN 117.94
AOS 61.51 0.16 VeriSign
ORAN 18.10 -0.11 SmithAO
LibertyGlobal C LBTYK 28.94 -0.16 Orange
VeriskAnalytics
VRSK
106.69
LibertyFormOne A FWONA 28.12 0.01 OrbitalATK OA 132.47 0.09 Smith&Nephew SNN 38.85 -0.02 Verizon
VZ
48.82
SJM 115.01 0.93
IX
87.79 -0.22 Smucker
LibertyFormOne C FWONK 29.53 0.01 Orix
VertxPharm VRTX 152.48
SNAP 14.13 -0.20
65.83 0.34 Snap
LibertyBraves A BATRA 21.92 -0.05 OwensCorning OC
Viacom B
VIAB 29.96
SNA 145.11 -0.14
PCG 46.27 0.17 SnapOn
LibertyBraves C BATRK 22.03 -0.01 PG&E
Viacom A
VIA 35.65
PHI
27.40 -0.09 SOQUIMICH SQM 55.09 0.20 Vipshop
LibertySirius A LSXMA 41.76 -0.01 PLDT
VIPS 15.47
SNE 46.35 0.52
PNC 145.34 -0.27 Sony
LibertySirius C LSXMK 41.64 -0.02 PNC Fin
VirtuFinancial VIRT 36.05
SO
45.81 -0.31
PKX 84.77 -0.08 Southern
LibertyProperty LPT 42.21 0.39 POSCO
VistraEnergy VST 22.85
SCCO 51.75 -1.06
PPG 106.92 1.04 SoCopper
EliLilly
LLY
79.07 -2.00 PPG Ind
VMware
VMW 133.22
SouthwestAir
LUV
52.94 0.11
PPL 28.84 -0.26
LincolnNational LNC 70.20 -0.44 PPL
Vodafone
VOD 29.13
PTC 82.83 0.48 SpectraEnerPtrs SEP 36.04 0.39 VornadoRealty VNO 70.21
LiveNationEnt LYV 39.75 0.28 PTC
PVH 155.36 -4.31 SpiritAeroSys SPR 79.35 -1.02 VoyaFinancial VOYA 51.51
LloydsBanking LYG
3.53 -0.04 PVH
SPLK 103.19 0.54 t
PCAR 63.58 -0.09 Splunk
LockheedMartin LMT 308.46 -12.38 Paccar
VulcanMatls VMC 111.77
SPOT 164.88 3.21
Loews
L
52.44 -0.02 PackagingCpAm PKG 116.33 0.64 Spotify
S
5.42 -0.19
LogitechIntl LOGI 37.29 0.27 PacWestBancorp PACW 51.94 0.70 Sprint
Square
SQ
48.20
0.86
LogMeIn
LOGM 110.60 0.40 PagSeguroDig PAGS 34.39 1.16
WBC 130.01
Lowe's
LOW 82.96 0.53 PaloAltoNtwks PANW 194.12 1.61 StanleyBlackDck SWK 140.64 -0.95 WABCO
SBUX 58.13 0.56 WEC Energy WEC 64.67
PK
28.77 -0.01 Starbucks
lululemon
LULU 99.70 -0.10 ParkHotels
WEX 165.48
LyondellBasell LYB 103.79 -1.94 ParkerHannifin PH 167.97 3.35 StateStreet STT 98.40 -1.38 s WEX
WPC 64.02
STO 25.13 -0.47 W.P.Carey
ParsleyEnergy PE
29.88 -0.15 Statoil
WPP 85.75
Paychex
PAYX 61.22 0.65 SteelDynamics STLD 44.12 -0.69 WPP
PaycomSoftware PAYC 112.59 -1.62 STMicroelec STM 22.17 0.43 WPX Energy WPX 17.08
M&T Bank
MTB 182.78 0.51 PayPal
WAB 88.72
SYK 168.94 -0.48 Wabtec
PYPL 74.81 0.20 Stryker
MGM Resorts MGM 31.40 -0.02 Pearson
PSO 11.31 -0.11 SumitomoMits SMFG 8.24 -0.16 WalgreensBoots WBA 65.42
MPLX
MPLX 35.73 0.40 PembinaPipeline PBA 31.73 -0.13 SunComms SUI
WMT 87.41
93.84 -0.01 Walmart
MSCI
MSCI 150.66 0.83 t Pentair
PNR 44.82 -0.36 SunLifeFinancial SLF 41.39 0.11 WasteConnections WCN 72.00
Macerich
MAC 57.88 0.26 People'sUtdFin PBCT 18.38 0.09 SuncorEnergy SU
WM 81.25
38.13 -0.10 WasteMgt
Macy's
M
30.74 -0.33 t PepsiCo
WAT 188.72
67.25 0.45 Waters
PEP 99.13 -1.81 SunTrustBanks STI
MadisonSquGarden MSG 238.91 -4.11 PerkinElmer PKI 72.45 -0.91 Symantec
WSO 167.89
SYMC 27.67 -0.12 Watsco
MagellanMid MMP 66.29 0.46 Perrigo
WB 115.50
PRGO 78.07 -0.07 SynchronyFin SYF 33.08 -0.09 Weibo
MagnaIntl
MGA 59.31 0.31 PetroChina PTR 73.74 0.13 Synopsys
SNPS 86.07 0.56 WellCareHealth WCG 214.87
Manpower
MAN 96.22 0.50 PetroleoBrasil PBR 13.77 -0.32 SynovusFin SNV 52.69 0.42 WellsFargo WFC 52.56
ManulifeFin MFC 18.83 -0.04 PetroleoBrasilA PBR.A 12.83 -0.32 Sysco
WELL 54.86
SYY 63.09 0.55 Welltower
MarathonOil MRO 18.20 -0.05 Pfizer
WestPharmSvcs WST 87.76
PFE 35.40 -1.21
MarathonPetrol MPC 72.90 -2.01 PhilipMorris PM
WestarEnergy
WR 54.05
81.20 -0.80
Markel
MKL 1141.47 11.43 Phillips66
PSX 111.85 0.54 TAL Education TAL 36.55 0.13 WestAllianceBcp WAL 59.53
MarketAxess MKTX 201.52 2.89 PinnacleFoods PF
WesternDigital
WDC 79.79
60.37 -0.03
Marriott
MAR 137.60 0.92 PinnacleWest PNW 80.02 -0.48 TD Ameritrade AMTD 58.87 0.78 WesternGasEquity WGP 33.71
Marsh&McLen MMC 81.49 -0.01 PioneerNatRscs PXD 198.86 -2.69 TE Connectivity TEL 91.80 0.05 WesternGasPtrs WES 47.42
TU
35.90 0.11 WesternUnion WU
MartinMarietta MLM 195.13 0.36 PlainsAllAmPipe PAA 23.58 0.07 Telus
19.91
Ternium
TX
40.55 0.88 WestlakeChem WLK 106.55
MarvellTech MRVL 20.32 0.26 PlainsGP
PAGP 24.03 -0.19
TSU 22.49 -0.26 WestpacBanking WBK 21.65
Masco
MAS 38.50 0.63 PolarisIndustries PII 106.93 2.11 TIM Part
TJX
TJX 83.57 -1.28 WestRock
Mastercard MA 180.25 1.98 Praxair
WRK 59.82
PX 153.30 0.78
MatchGroup MTCH 36.71 -10.41 PrincipalFin PFG 58.30 -0.92 T-MobileUS TMUS 59.43 -1.08 Weyerhaeuser WY 36.39
TRowePrice
TROW 111.25 -2.57 WheatonPrecMet WPM 20.90
MaximIntProducts MXIM 55.29 0.79 t Procter&Gamble PG
71.96 -0.38
McCormick MKC 104.70 -0.71 Progressive PGR 60.50 0.21 TableauSftwr DATA 84.78 -0.27 Whirlpool
WHR 155.92
TaiwanSemi TSM 38.93 0.48 Williams
McCormickVtg MKC.V 103.38 -2.31 Prologis
WMB 25.96
PLD 65.07 0.16
TakeTwoSoftware TTWO 104.30 4.59 WilliamsPartners WPZ 36.70
McDonalds MCD 163.44 -4.00 Proofpoint
PFPT 118.87 0.93
TPR 47.46 -6.31 WillisTowers WLTW 148.55
McKesson
MCK 154.21 -2.00 PrudentialFin PRU 106.11 -0.21 Tapestry
TargaResources TRGP 46.68 -0.29 t Wipro
Medtronic
MDT 81.01 0.88 Prudential
WIT
4.76
PUK 51.57 0.25
TGT 71.07 -1.53 WooriBank WF
MelcoResorts MLCO 32.25 1.04 PublicServiceEnt PEG 51.86 -0.29 Target
44.53
MercadoLibre MELI 339.46 -0.15 PublicStorage PSA 204.50 2.72 TataMotors TTM 25.40 0.28 Workday
WDAY 125.62
32.77 -0.19 Worldpay
Merck
MRK 57.98 -0.89 PulteGroup PHM 30.88 0.52 TechnipFMC FTI
WP 81.62
TeckRscsB
TECK 24.96 -0.17 Wyndham
MetLife
MET 47.30 -0.37 Qiagen
WYN 114.97
QGEN 32.95 0.24
TelecomArgentina TEO 29.95 -0.09 WynnResorts WYNN 191.85
MettlerToledo MTD 567.22 7.29 Qorvo
QRVO 71.80 4.40
TelecomItalia A TI.A
8.60 -0.03 XPO Logistics XPO 95.53
MichaelKors KORS 66.40 -2.02 Qualcomm
QCOM 50.82 -0.19
TelecomItalia TI
9.86 -0.15 XcelEnergy
MicroFocus MFGP 17.26 -0.06 QuestDiag
XEL 46.65
DGX 102.47 1.27
MicrochipTech MCHP 85.02 1.36 QurateQVC A QRTEA 24.01 0.60 TeledyneTech TDY 180.65 -6.44 Xerox
XRX 32.29
TFX 270.38 2.50 Xilinx
MicronTech MU
46.79 0.81 QurateQVC B QRTEB 24.08 -0.05 Teleflex
XLNX 64.53
Ericsson
ERIC 7.51 -0.04 Xylem
Microsemi
MSCC 65.05 0.36
XYL 70.37
TelefonicaBras VIV 14.14 0.02 YPF
Microsoft
MSFT 95.00 1.48
YPF 21.58
Telefonica
TEF
10.05
-0.10
MidAmApt MAA 92.52 1.06
YY
YY
96.67
RENX 21.19 -0.08 TelekmIndonesia TLK 27.17 -0.08 Yandex
Middleby
MIDD 126.98 1.14 RELX
YNDX 33.63
TS
37.39 0.01 YumBrands YUM 86.64
RELX 21.55 -0.07 Tenaris
MitsubishiUFJ MUFG 6.52 -0.16 RELX
TER 33.51 0.96 YumChina
RPM 48.38 0.08 Teradyne
MizuhoFin
MFG 3.58 -0.06 RPM
YUMC 42.47
TSLA 299.92 6.02 ZTO Express ZTO 16.61
MobileTeleSys MBT 10.38 -0.12 RSP Permian RSPP 49.62 0.01 Tesla
MohawkInds MHK 215.86 5.98 RalphLauren RL 106.93 -2.92 TevaPharm TEVA 18.71 0.73 ZayoGroup ZAYO 35.75
MolsonCoors B TAP 71.68 0.44 RandgoldRscs GOLD 81.39 0.29 TexasInstruments TXN 103.40 1.97 ZebraTech
ZBRA 136.78
TXT 62.10 -0.04 Zillow A
ZG
Momo
MOMO 35.58 0.68 RaymondJames RJF 89.95 0.20 Textron
49.56
RTN 202.08 -2.86 ThermoFisherSci TMO 210.72 0.37 Zillow C
Z
Mondelez
MDLZ 38.99 -0.51 Raytheon
49.72
40.16 -0.06 ZimmerBiomet ZBH 116.95
51.18 0.67 ThomsonReuters TRI
Monsanto
MON 125.61 0.24 RealtyIncome O
MMM 195.02 0.63 ZionsBancorp ZION 55.05
RHT 163.14 0.08 t 3M
MonsterBev MNST 55.20 0.20 RedHat
TIF 101.59 -1.24 Zoetis
ZTS 83.40
Moody's
MCO 164.16 1.96 RegencyCtrs REG 59.26 0.41 Tiffany
Data provided by
1.82
One-year CD
EH National Bank /5
$0
(888) 392-5265
M.Y. Safra Bank, FSB /NR $5,000
(212) 652-7200
VirtualBank /4
$10,000
(877) 998-2265
VirtualBank /4
(877) 998-2265
Applied Bank /5
(800) 616-4605
Bank/rank
Phone number
Net
Sym Close Chg
J K L
High yield savings
Bank/rank
Phone number
Stock
ItauUnibanco ITUB 14.50 -0.03
G H I
D E F
Net
Sym Close Chg
Stock
KEY: A: annual; M: monthly; Q: quarterly; r: revised; SA: semiannual; S2:1: stock split and ratio; SO:
spin-off.
Net YTD
NAV Chg % Ret Fund
USBdIdxInstPrem 11.21 -0.01
Fidelity Advisor I
32.67 +0.10
NwInsghtI
Fidelity Freedom
16.51 -0.02
FF2020
14.36 -0.01
FF2025
18.04 -0.01
FF2030
Freedom2020 K 16.50 -0.01
Freedom2025 K 14.34 -0.01
Freedom2030 K 18.02 -0.01
...
Freedom2035 K 15.24
...
Freedom2040 K 10.71
Fidelity Invest
23.75 +0.01
Balanc
92.31 +0.57
BluCh
126.54 +0.78
Contra
126.51 +0.79
ContraK
CpInc r
10.12
...
DivIntl
39.48 -0.15
GroCo
189.30 +1.22
189.32 +1.22
GrowCoK
7.68 -0.01
InvGB
10.91 -0.02
InvGrBd
54.82 -0.25
LowP r
107.11 +0.16
MagIn
115.12 +0.98
OTC
23.39 +0.02
Puritn
SrsEmrgMkt 21.23 -0.06
SrsGroCoRetail 17.69 +0.12
SrsIntlGrw
16.02 -0.04
10.68 -0.05
SrsIntlVal
10.34 -0.02
TotalBond
First Eagle Funds
58.64 -0.03
GlbA
FPA Funds
34.46 +0.01
FPACres
FrankTemp/Frank Adv
2.27 -0.01
IncomeAdv
FrankTemp/Franklin A
CA TF A p
7.23 -0.02
IncomeA p
2.29 -0.01
59.78 +0.04
RisDv A p
FrankTemp/Franklin C
2.32 -0.01
Income C t
FrankTemp/Temp A
12.06 +0.03
GlBond A p
Growth A p 27.02 -0.14
FrankTemp/Temp Adv
GlBondAdv p 12.01 +0.03
Harbor Funds
CapApInst
73.84 +0.47
IntlInst r
67.68 +0.01
Harding Loevner
NA
...
IntlEq
Invesco Funds A
10.79 -0.01
EqIncA
John Hancock Class 1
15.12
...
LSBalncd
16.12 +0.01
LSGwth
John Hancock Instl
DispValMCI
23.18 +0.01
JPMorgan Funds
MdCpVal L
39.48 -0.19
JPMorgan R Class
11.24 -0.02
CoreBond
Lazard Instl
19.72 -0.10
EmgMktEq
Lord Abbett A
...
ShtDurIncmA p 4.19
Lord Abbett F
ShtDurIncm
4.19
...
Metropolitan West
TotRetBd
10.35 -0.02
10.34 -0.03
TotRetBdI
9.73 -0.03
TRBdPlan
MFS Funds Class I
39.03 -0.03
ValueI
MFS Funds Instl
25.51 -0.12
IntlEq
Net YTD
NAV Chg % Ret Fund
-2.4 Oakmark Funds Invest
31.40 -0.07
EqtyInc r
4.2 Oakmark
83.92 +0.34
28.31 -0.10
OakmrkInt
Old
Westbury
Fds
-0.4
-0.3 LrgCpStr
14.48 -0.01
-0.1 Oppenheimer Y
-0.3 DevMktY
43.65 -0.02
-0.3 IntGrowY
43.63 -0.02
-0.1 Parnassus Fds
0.2 ParnEqFd
42.90 +0.07
0.2 PIMCO Fds Instl
NA
...
AllAsset
0.4 ShortT
9.88
...
5.2 TotRt
9.95 -0.02
4.9 PIMCO Funds A
5.0 IncomeFd
NA
...
-0.5 PIMCO Funds I2
-1.3 Income
NA
...
6.0 PIMCO Funds Instl
6.0 IncomeFd
NA
...
-2.3 Price Funds
-2.1 BlChip
104.20 +0.61
0.6 EqInc
32.69 -0.03
2.4 EqIndex
71.30 +0.18
4.8 Growth
66.29 +0.41
0.2 HelSci
71.95 +0.46
-0.8 InstlCapG
39.74 +0.21
6.4 IntlStk
18.56 -0.04
-0.8 IntlValEq
15.11 -0.05
-0.1 MCapVal
30.73 -0.05
-2.0 MidCap
89.25 -0.23
N Inc
9.19 -0.01
-0.7 NHoriz
55.51 +0.01
11.42 -0.04
OverS SF r
-0.7 R2020
22.51 -0.01
17.61
...
R2025
-1.6 R2030
26.00 -0.01
19.07
...
R2035
-2.0 R2040
27.42
...
-1.7 Value
36.51 -0.02
-2.0 PRIMECAP Odyssey Fds
AggGrowth r 47.28 +0.35
-1.9 Growth r
39.20 +0.30
31.55 +0.08
Stock r
2.5 Principal Investors
-0.9 DivIntlInst
13.95 -0.01
Prudential Cl Z & I
2.5 TRBdZ
14.06 -0.05
Schwab Funds
6.3 S&P Sel
41.13 +0.10
0.2 TIAA/CREF Funds
BdIdxInst
10.46 -0.02
NA EqIdxInst
19.65 +0.05
IntlEqIdxInst 20.28 -0.05
-1.2 Tweedy Browne Fds
29.15 -0.03
GblValue
-0.2 VANGUARD ADMIRAL
0.2 500Adml
245.36 +0.63
34.25 +0.04
BalAdml
-0.6 CAITAdml
11.53 +0.01
CapOpAdml r 154.68 +0.92
-2.0 EMAdmr
38.00 -0.10
75.45 -0.13
EqIncAdml
-2.1 ExplrAdml
92.68 +0.32
85.14 +0.29
ExtndAdml
-1.5 GNMAAdml
10.19 -0.01
GrwthAdml
73.73 +0.50
-0.2 HlthCareAdml r 82.77 +0.05
HYCorAdml r 5.75 -0.01
-0.1 InfProAd
25.19 -0.07
98.49 -0.11
IntlGrAdml
-2.2 ITBondAdml 10.91 -0.02
-2.2 ITIGradeAdml 9.39 -0.01
-2.2 LTGradeAdml 9.77 -0.04
MidCpAdml 190.87 +0.21
-4.0 MorgAdml
94.59 +0.60
MuHYAdml
11.15
...
0.2 MuIntAdml
13.80
...
1.02
0.39
3.56
0.17
0.13
-0.01
-0.09
-1.03
-1.05
-0.30
-0.04
0.31
0.47
0.98
9.71
0.60
1.42
-0.45
-0.13
0.55
1.00
0.39
0.30
0.16
-0.42
0.21
0.66
-0.39
0.11
0.97
0.23
0.30
0.04
-0.02
-0.19
0.78
0.40
0.76
5.66
-1.63
-0.19
0.84
0.29
-2.53
-0.31
0.28
0.27
-0.46
-0.29
0.11
-0.55
1.95
1.19
1.23
1.78
0.30
-0.08
Net YTD
NAV Chg % Ret
11.34 +0.01
MuLTAdml
-2.5 MuLtdAdml
10.79
...
-0.5 MuShtAdml
15.68
...
-0.9 PrmcpAdml r 135.66 +0.51
RealEstatAdml 108.80 +0.91
0.1 SmCapAdml 70.87 +0.21
...
STBondAdml 10.23
1.7 STIGradeAdml 10.46
...
... TotBdAdml
10.40 -0.01
...
TotIntBdIdxAdm 21.80
0.9 TotIntlAdmIdx r 30.44 -0.10
TotStAdml
66.48 +0.18
NA TxMIn r
14.37 -0.05
0.7 ValAdml
40.35 -0.06
-2.3 WdsrllAdml
65.88 +0.08
62.85 -0.13
WellsIAdml
NA WelltnAdml
70.99 -0.02
WndsrAdml 78.74 -0.19
NA VANGUARD FDS
26.17 -0.14
DivdGro
NA INSTTRF2020 22.42
...
...
INSTTRF2025 22.77
8.2 INSTTRF2030 23.04
...
-1.6 INSTTRF2035 23.32
...
-0.2 INSTTRF2040 23.59
...
5.8 INSTTRF2045 23.78 +0.01
2.3 INSTTRF2050 23.80
...
7.7 IntlVal
39.69 -0.18
-0.6 LifeCon
19.74
...
-0.1 LifeGro
33.59
...
1.1 LifeMod
27.01
...
2.6 PrmcpCor
26.65 +0.08
-2.2 SelValu r
29.67 +0.02
5.6 STAR
26.73
...
1.0 TgtRe2015
15.24
...
-0.1 TgtRe2020
31.22 -0.01
0.1 TgtRe2025
18.41
...
0.3 TgtRe2030
33.51 -0.01
0.5 TgtRe2035
20.64
...
0.7 TgtRe2040
35.72
...
-2.2 TgtRe2045
22.47
...
36.17 +0.01
TgtRe2050
6.7 TgtRetInc
13.42
...
5.2 TotIntBdIxInv 10.90
...
-1.1 WellsI
25.94 -0.06
41.11 -0.01
Welltn
0.4 WndsrII
37.12 +0.04
VANGUARD INDEX FDS
-2.6 500
245.34 +0.62
210.10 +0.72
ExtndIstPl
-0.1 SmValAdml
55.89 +0.07
TotBd2
10.37 -0.01
-2.5 TotIntl
18.20 -0.06
... TotSt
66.45 +0.17
0.5 VANGUARD INSTL FDS
BalInst
34.25 +0.03
2.3 DevMktsIndInst 14.39 -0.05
DevMktsInxInst 22.49 -0.08
-0.1 ExtndInst
85.13 +0.29
-0.8 GrwthInst
73.74 +0.51
-1.2 InPrSeIn
10.26 -0.03
0.7 InstIdx
242.16 +0.61
-0.3 InstPlus
242.18 +0.62
-2.7 InstTStPlus
59.10 +0.16
4.8 MidCpInst
42.16 +0.04
0.7 MidCpIstPl
207.95 +0.23
-1.6 SmCapInst
70.87 +0.22
2.2 SmCapIstPl 204.56 +0.62
-2.1 STIGradeInst 10.46
...
-1.2 TotBdInst
10.40 -0.01
-1.3 TotBdInst2
10.37 -0.01
3.0 TotBdInstPl
10.40 -0.01
-3.1 TotIntBdIdxInst 32.70 -0.01
-2.7 TotIntlInstIdx r 121.73 -0.40
-6.7 TotItlInstPlId r 121.75 -0.40
... TotStInst
66.49 +0.18
4.3 ValueInst
40.35 -0.05
-1.3 Western Asset
-1.4 CorePlusBdI
NA
...
-1.7
-0.3
0.3
1.5
-6.5
0.4
-0.8
-0.8
-2.4
0.8
...
...
0.1
-2.0
-1.8
-3.1
-1.6
-0.3
-0.3
-0.5
-0.4
-0.3
-0.2
-0.1
-0.1
-0.1
-0.5
-0.8
-0.2
-0.5
-0.9
-5.1
-0.3
-0.6
-0.5
-0.5
-0.4
-0.2
-0.1
-0.1
-0.1
-0.6
0.8
-3.1
-1.6
-1.9
-0.2
0.8
-1.6
-2.4
...
...
-0.8
0.1
0.1
0.7
2.2
-1.3
-0.1
-0.1
0.1
-0.1
...
0.4
0.4
-0.8
-2.4
-2.4
-2.4
0.8
...
...
...
-2.0
NA
.
B12 | Wednesday, May 2, 2018
* *
THE WALL STREET JOURNAL.
BANKING & FINANCE
BY LESLIE SCISM
MetLife Inc.’s chief financial officer has stepped down
from the position, days after
the company announced reduced compensation tied to
weaknesses in internal financial controls.
John C.R. Hele is being succeeded immediately but is expected to stay until September
as a senior adviser. He received 6.4% less in total compensation in 2017 than the
year before, including a 25%
reduction in the cash portion
of his incentive pay.
The decline in his pay came
in the wake of a problem in the
company’s retirement-services
business: the failure to pay
thousands of people owed pension benefits.
Mr. Hele will be succeeded as
finance chief by executive vice
president John McCallion, who
is currently MetLife’s treasurer.
MetLife said Tuesday that
Mr. Hele is retiring, and in a
news release the company’s
chief executive praised him
“for bringing a sharper focus
on the true economics of the
business we write.”
A MetLife spokesman said
Mr. Hele, 59 years old, declined to comment.
The announcement about Mr.
Hele comes just a day before
the company reports first-quarter earnings on Wednesday.
While analysts weren’t surprised by Mr. Hele’s departure,
the timing of the move immediately ahead of the earnings
was puzzling, and some said it
raises
questions
about
whether new negative issues
will emerge. “But we suspect
that if anything materially new
and negative had occurred
[during the first quarter], it
likely would have been pre-announced along with the executive changes being announced
today,” Evercore ISI analysts
said in a note to clients.
In late 2017, MetLife disclosed that more than 10,000
people in private-sector pension plans for which the insurer had assumed responsibility hadn’t gotten money owed
them because the insurer
hadn’t searched for them diligently enough. MetLife made
limited efforts to track down
people
whose
addresses
weren’t current or otherwise
IAN WALDIE/BLOOMBERG NEWS
MetLife Finance Chief Hele Leaves Post
Mr. Hele, seen here, will be succeeded as CFO by John McCallion, who is now MetLife’s treasurer.
didn’t respond to letters, the
company has acknowledged.
Despite only limited search
efforts, the giant insurer in past
years had reduced reserves reflecting what it owed retirees,
thus boosting profits. In detailing its fourth-quarter earnings,
MetLife said it had bolstered its
reserves by $510 million pretax
to bring them up to the level
that it says will now correctly
reflect what it owes.
MetLife has said that the
problems in the pensions business date to the 1990s and reflected a “material weakness in
internal control over financial
reporting.” That means the
company had a flaw in its policies or procedures that are intended to ensure its financial
statements are accurate. Such
controls are typically the responsibility of a company’s CFO.
Sorting out the pension
problem prompted MetLife to
delay the release of its 2017
fourth-quarter
earnings.
MetLife has said that federal
securities and state regulators
have inquired about the pension-payments problem.
In addition, earlier this year
MetLife acknowledged another
mistake that involved flawed
internal financial controls. It revised its 2017 earnings upward
after discovering it had miscalculated reserves for a retirement-savings product in Japan.
Analysts said the events
raised questions among investors about confidence in the
company and management.
MetLife shares fell 0.8% to
$47.30 Tuesday. Since MetLife
disclosed the pensions snafu in
December, its shares have declined 8% while the S&P 500’s
subindex of life- and health-insurance stocks is down 7.4%,
according to FactSet.
In February, the longtime
executive in charge of the unit
that failed to pay the estimated
13,500 retirees their pension
benefits left the company.
Mr. Hele joined MetLife in
2012. Previously, he was finance chief of insurer and reinsurer Arch Capital Group Ltd.
Carlyle Shows Slower
Portfolio-Value Gains,
Reducing Earnings
BRENT LEWIN/BLOOMBERG NEWS
BY MIRIAM GOTTFRIED
Najib Razak, Malaysia’s prime minister, in 2009 set up the state investment fund that is at the center of a Swiss investigation.
PetroSaudi Is Part of 1MDB Inquiry
ZURICH—Swiss prosecutors
have launched criminal proceedings against two officials
at PetroSaudi International
Ltd. related to alleged dealings
with Malaysian state investment fund 1Malaysia Development Bhd., an escalation of
the Swiss probe that started
nearly three years ago.
1MDB is the subject of investigations in the U.S., Switzerland and other countries
into allegations that billions of
dollars were siphoned out of
the fund, which was set up by
Malaysian Prime Minister Najib Razak in 2009.
The Swiss attorney general’s office said they launched
the proceedings in November
against the PetroSaudi officials, who weren’t named, on
suspicion of criminal mismanagement, fraud, bribery of foreign public officials, aggravated money laundering and
misconduct in public office.
One of the officials also is suspected of document forgery.
“Certain steps taken in the
proceedings against these two
officials and a risk of collusion
prevented the [attorney general’s office] from disclosing
those criminal proceedings
earlier,” the office said in a
MOHD RASFAN/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY BRIAN BLACKSTONE
statement responding to questions on the matter Tuesday.
Prosecutors are looking into
whether 1MDB funds intended
for investments in PetroSaudi
and other projects in the natural-resources area were misappropriated.
Attorneys for PetroSaudi
said in a statement that the
company is aware of the investigation by Swiss authorities
and that the company isn’t the
subject of the probe.
“PetroSaui denies any
wrongdoing in connection
with its Joint Venture with
1MDB and it rejects any claims
that it, or any of its officials,
are involved in the misappropriation of funds from 1MDB.
PetroSaudi will cooperate fully
with investigating authorities,” they said.
The 1MDB fund, in a statement Tuesday, denied wrongdoing. “We have and remain
ready to assist the investigation of any lawful authority, in
line with international proto-
cols. Until today, 1MDB has not
received any such request,”
the fund said.
The latest development in
the Swiss probe was reported
earlier by the Financial Times.
PetroSaudi was founded in
2005 by a Saudi citizen, Tarek
Obaid, and a member of the
Saudi royal family, Turki Bin
Abdullah Al Saud.
The U.S. Justice Department alleges in court filings
that PetroSaudi, a Riyadhbased
energy-investment
startup, was involved in what
it calls the first stage of a multiyear scam to divert billions
of dollars from 1MDB. About a
billion dollars was allegedly
misappropriated through a
joint venture between the two
companies, the court filings
from 2016 and 2017 said.
The Swiss attorney general
opened an investigation into
the alleged misappropriation
of funds from 1MDB in August
2015 amid concerns that the
country’s banks may have
been used for illegal activities.
Both 1MDB and Mr. Najib
have denied wrongdoing and
said they would cooperate
with any lawful international
investigation. Multiple Malaysian investigations in that
country into 1MDB closed
without finding wrongdoing.
FINANCE WATCH
BARCLAYS
Bank Will Look
Outside for Chairman
Barclays PLC will look externally for a new chairman after
front-runner Gerry Grimstone
unexpectedly pulled out of the
race to head the British bank.
Barclays Chairman John McFarlane said Tuesday that he
had asked the board to search
for his successor. Mr. McFarlane
hasn’t said when he will go and
pledged to serve at least one
more year at the bank. “While
some might wish so, you are not
getting rid of me yet,” said Mr.
McFarlane at the annual shareholder meeting on Tuesday. Mr.
Grimstone, who is the chairman
of Standard Life Aberdeen PLC
and is chief of the international
banking unit at Barclays, was
tipped by insiders to take over
the reins. Mr. Grimstone, however, decided not to apply for
the job, according to people familiar with the matter.
—Max Colchester
BANKRUPTCY COURT
Tilton Strikes Deal
With Zohar Creditors
Lynn Tilton reached settlements with creditors of the $2.5
billion Zohar funds she created,
a legal cease-fire that comes after the turnaround executive
placed the troubled investment
vehicles in bankruptcy.
The settlement framework
will keep the three Zohar
funds—collateralized loan obligations that raised money for Ms.
Tilton’s collection of troubled
businesses—in bankruptcy while
monetizing the loans they made
to companies, according to papers filed with the U.S. Bankruptcy Court in Wilmington, Del.
The settlement unveiled late
Monday paves the way for the
portfolio companies that owe
money to the Zohar funds to be
sold or have their debt refinanced to raise money for repaying creditors. The deal requires court approval.
—Andrew Scurria
BREVAN HOWARD
Trader Is Cited
At Rate-Rig Trial
A former JPMorgan Chase &
Co. and Citigroup Inc. trader,
who is currently a star manager
at hedge-fund company Brevan
Howard, was named in a U.K.
court as an alleged co-conspirator in what prosecutors call a
scheme to manipulate interest
rates. Alfredo Saitta and six others were named last month by
the U.K.’s Serious Fraud Office
as alleged co-conspirators—but
not charged—during a trial of
other bank employees. A Brevan
spokesman declined comment.
—Laurence Fletcher
Carlyle Group LP reported
a first-quarter profit that exceeded Wall Street’s expectations as the value of its portfolio climbed in the face of
market volatility. Still, a drop
in performance revenue meant
earnings sagged compared
with the prior year.
Economic net income, a
closely watched performance
measure that reflects changes
in the value of the firm’s holdings, fell to $161 million on a
post-tax basis, or 47 cents a
share, from $364.6 million, or
$1.09 a share, a year earlier.
Analysts polled by FactSet had
expected 29 cents.
For the three months ended
March 31, the Washington,
D.C., asset manager reported
net income of $33.8 million, or
30 cents a share. That compares with a profit of $83 million, or 90 cents a share, in the
year-earlier quarter.
Slower growth in the value
of the assets in its portfolio
was the primary reason for
Carlyle’s earnings decline from
the year-earlier period. The
firm told investors to expect
portfolio appreciation to moderate as it transitions to investing a new generation of funds.
The value of Carlyle’s privateequity portfolio climbed 4% in
the first quarter, down from 9%
in the first quarter of 2017. By
comparison, rival Blackstone
Group LP said April 19 that its
private-equity portfolio climbed
6.4% in the first quarter of 2018.
Both outpaced the S&P 500,
which fell 1.2% over the period
amid a spike in volatility.
“The beauty of our business
is we don’t buy indexes,” said
Carlyle co-Chief Executive
Kewsong Lee on a conference
call with analysts on Tuesday.
“I feel pretty good about our
chances to continue to outper-
form on a relative basis.”
Fee-related earnings also
fell in the quarter to $28.2 million, down from $37.1 million
in the first quarter of 2017.
Carlyle, which has set a longterm goal of raising a total of
$100 billion in new capital by
2019, said it brought in $7.7 billion in the first quarter alone.
Fundraising expenses were $19
million, compared with $7 million a year earlier, Carlyle said.
The firm said it was on
track to meet its target of $75
million in fee-related earnings
by the fourth quarter of this
year as $27 billion of the new
capital it has raised gradually
becomes eligible for manage-
‘The beauty of our
business is we don’t
buy indexes,’ co-CEO
Kewsong Lee says.
ment fees.
Carlyle’s distributable income, the slice of profit available for payout to shareholders, came in at 36 cents a
share, up from 13 cents a share
a year earlier. Carlyle said it
would pay a 27-cent dividend,
up from 10 cents in the first
quarter of 2017.
In March, Carlyle said it
would buy the specialty-chemical business of Dutch paint giant Akzo Nobel NV for about
$12.6 billion, including debt, in
one of the largest private-deals
of the year.
The firm sold $5.6 billion
worth of investments in the
first quarter. Among its divestitures was the $1.75 billion
sale of valuation and corporate-finance adviser Duff &
Phelps to private-equity firm
Permira.
Goldman to Settle
Foreign-ExchangeCase
BY IRA IOSEBASHVILI
Goldman Sachs Group Inc.
will pay roughly $110 million
to settle claims that it failed
to supervise foreign exchange
traders who put clients at a
disadvantage by inappropriately sharing information
about their market positions
with rivals.
The firm will make payments of $54.75 million to both
the Federal Reserve Board and
the New York Department of
Financial Services, the regulators said Tuesday.
Between 2008 and early
2013, the bank’s traders used
electronic chat rooms to share
confidential customer information and to discuss potentially
coordinating trading activity,
the New York agency said.
“This improper activity
sought to enable banks and
the involved traders to achieve
higher profits from execution
of foreign exchange trades,
sometimes at customers’ expense,” it said.
While the bank had policies
addressing its foreign exchange business in place as
early as 2001, “escalation of
compliance concerns did not
always occur as required, allowing potentially improper
trading activity to continue.”
The individuals that had
participated in the improper
trading are no longer with the
firm, according to a person
with knowledge of the matter.
“We are pleased to have resolved the Federal Reserve
Board’s and New York Department of Financial Services’ respective reviews and appreciate their recognition that we
have already taken significant
steps to enhance our policies
and procedures,” Goldman
Sachs said.
—Telis Demos
contributed to this article.
.
THE WALL STREET JOURNAL.
Wednesday, May 2, 2018 | B13
* * * * *
MARKETS
Treasurys
Fall Ahead
Of Report
On Supply
U.S. Stocks Mixed as Dow Drops
BY SAM GOLDFARB
BY GEORGI KANTCHEV
AND ALLISON PRANG
U.S. government bond
prices fell Tuesday, as investors awaited new insight into
the Treasury Department’s
debt-issuance plans.
The yield on the benchmark
10-year
CREDIT
U.S. Treasury
MARKETS note settled at
2.976%,
compared
with
2.936% Monday.
Yields, which rise when
bond prices fall, have slipped
since the middle of last week
when the 10-year yield briefly
surpassed 3%.
Many analysts expect
yields to keep rising in the
coming months as long as the
Federal Reserve sticks to its
plan of at least three interestrate increases this year.
Many, however, also anticipate bumps along the road as
higher yields periodically attract waves of buying.
Along with rising interest
rates, Treasury yields have
also been kept aloft recently
by an expanding federal budget deficit.
Earlier this year, a group
of private banks that advise
the Treasury—known as the
Treasury Borrowing Advisory
Blue chips extend
slump to a third
session as S&P 500,
Nasdaq log gains
The Dow Jones Industrial
Average slumped Tuesday but
pared most of its losses as investors weighed global trade
negotiations,
central-bank
moves and the
TUESDAY’S latest round of
MARKETS
corporate
earnings and
manufacturing data.
The blue-chip index, which
declined for a third straight
session, tumbled as much as
355 points in midday trading,
pressured by falling shares of
Pfizer and Merck & Co. But it
bounced back to end the day
down 64.10 points, or 0.3%, at
24099.05.
The S&P 500 rose 6.75
points, or 0.3%, to 2654.80,
and the technology-heavy Nasdaq Composite climbed 64.44
points, or 0.9%, to 7130.70.
The major indexes eked out
small gains in April on the
back of strong corporate earnings after being rocked by a
bout of volatility earlier in the
year. First-quarter earnings
have largely topped expectations, but investors haven’t rewarded beats at the same pace
as in recent quarters.
Shares of Pfizer fell $1.21,
or 3.3%, to $35.40, while Merck
shares dropped 89 cents, or
1.5%, to 57.98, after both pharmaceutical giants reported
revenue that fell short of estimates.
McDonald’s dropped 4, or
2.4%, to 163.44, giving back
some of the prior session’s
gains, after reporting on Monday global sales and profit
growth in the first quarter
that were overshadowed by a
decline in U.S. customer visits.
Tapestry, known for the designer brand Coach, slid 6.31,
or 12%, to 47.46, after reporting weakness at its Stuart
Weitzman shoe brand.
Elsewhere, the Institute for
Supply Management released
its manufacturing data for
April, which showed growth
had slowed slightly compared
with March.
Erik Davidson, chief investment officer for Wells Fargo
Private Bank, said the data—
Dragged Down
Pfizer and Merck & Co. were among the biggest decliners in the blue-chip
index on Tuesday after reporting disappointing revenue figures.
1%
0
Dow Jones
Industrial Average
–1
Merck
–2
–3
Pfizer
–4
–5
–6
10 a.m. 11
Noon 1
Source: FactSet
which he described as “a little
on the weak side”—adds to investors’ worries that earnings
and the economy have already
hit their best marks.
Jeff Mills, co-chief investment strategist for PNC Financial Services Group, said
stocks were following Monday’s losses and that the manufacturing data didn’t help
boost shares. But expectations
for the ISM data were high and
2
3
4 p.m.
THE WALL STREET JOURNAL.
the data weren’t too bad, he
said. “There was no real obvious downside catalyst today,”
Mr. Mills said.
Outside of earnings and
economic data, President Donald Trump late Monday gave
the European Union and some
nations outside the bloc an additional month to negotiate
deals that would exempt them
from U.S. steel and aluminum
tariffs. The White House said
Dollar Rises
To 2018 High
On Strong
Growth Data
2.976%
BY DANIEL KRUGER
AUCTION RESULTS
Here are the results of Tuesday's Treasury auction.
All bids are awarded at a single price at the marketclearing yield. Rates are determined by the difference
between that price and the face value.
FOUR-WEEK BILLS
$136,991,801,100
Applications
$45,000,437,100
Accepted bids
$734,916,300
" noncompetitively
$100,000,000
" foreign noncompetitively
99.871667
Auction price (rate)
(1.650%)
1.675%
Coupon equivalent
95.47%
Bids at clearing yield accepted
912796PH6
Cusip number
The bills, dated May 3, 2018, mature on May 31, 2018.
GORAN TOMASEVIC/REUTERS
Yield at which 10-year Treasury
note settled on Tuesday
Committee—estimated the
Treasury would need to borrow a net $955 billion in the
fiscal year that ends Sept. 30,
up substantially from the
$519 billion it borrowed in
the previous fiscal year.
The Treasury is scheduled
on Wednesday to release its
latest refunding announcement, which should provide
more details about how it intends to meet its borrowing
needs. To date, the department has increased issuance
of short-term debt more than
long-term bonds, a decision
that analysts say has helped
lead to a flatter yield curve,
or narrower gap between
short- and long-term Treasury yields.
If Treasury officials “start
leaning toward more long-end
issuance, I think that would
definitely surprise the market,” causing the yield-curve
to steepen, said Subadra Rajappa, head of U.S. rates
strategy at Société Générale
SA.
broad tariffs of 25% on steel
and 10% on aluminum won’t
take effect for the EU on Tuesday as previously planned.
“Trade issues and protectionist rhetoric aren’t constructive for markets as they
could impact growth. But for
now it doesn’t seem like it will
boil over,” said Eric Stein, codirector of global income at
Boston-based Eaton Vance.
Traders also were looking
ahead to a Federal Reserve
meeting, which concludes
Wednesday, where the U.S.
central bank isn’t expected to
announce any major policy
moves.
The dollar extended its
gains after registering in April
its largest one-month advance
since late 2016. The WSJ Dollar Index, which tracks the dollar against a basket of 16 currencies, was up 0.6%.
Most markets in Asia were
closed Tuesday for the Labor
Day holiday, and Japan will be
closed for the rest of the week
following Wednesday’s action.
Early Wednesday, the Nikkei
Stock Average was down 0.2%
and Hong Kong’s Hang Seng
Index was down 0.1%.
—Suryatapa Bhattacharya
contributed to this article.
Rio Tinto’s plans to ship its Mozambique coal along the Zambezi River proved unworkable partly because of problems dredging it.
More Legal Ire for Rio in Australia
BY RHIANNON HOYLE
SYDNEY—Australia’s corporate regulator has widened legal action against Rio Tinto
Ltd. and two of the company’s
former exCOMMODITIES e c u t i v e s ,
pursuing allegations
the mining giant was late in
writing down a troubled African investment.
Rio Tinto has come under
scrutiny from officials in the
U.S., U.K. and Australia over
the handling of coal assets it
purchased in Mozambique for
about $4 billion in 2011, but
which faced substantial writedowns and were later sold at
just $50 million.
The Australian Securities
and Investments Commission
said Tuesday that it has
lodged new allegations against
Rio Tinto, former Chief Executive Thomas Albanese and former Chief Financial Officer
Guy Elliott, posing that the assets should have been impaired in the company’s 2012
interim financial statements.
“By not doing so…ASIC alleges Rio Tinto also engaged
in misleading or deceptive
conduct,” the regulator said.
Mr. Albanese left Rio
Tinto—the world’s secondlargest listed mining firm—in
2013, as the company announced a global write-down
of $14 billion, including some
$3 billion in Mozambique.
“The charges are wholly unwarranted, and Rio Tinto intends to vigorously defend itself, and is confident that
ASIC’s allegations will be rejected once all the facts are
considered in court,” a Rio
Tinto spokesman said on
Tuesday.
U.S. officials in October alleged that Rio Tinto had misled investors about the value
of its Mozambique assets.
A Securities and Exchange
Commission suit alleges the
company continued to value
its mining assets in Mozambique at more than $3 billion
after an internal assessment
put their worth at negative
$680 million.
The SEC also alleges that
Messrs. Albanese and Elliott
didn’t disclose the problems
with the Mozambique assets
because they had already written down the value of Rio
Tinto’s Alcan aluminum division and feared the market’s
reaction to another unsuccessful deal.
They did this despite knowing the Mozambique coal business “was a lemon,” according
to a recent U.S. court filing.
The allegations also led Mr.
Elliott to resign from the
board of Royal Dutch Shell
PLC.
Both men have disputed the
U.S. allegations. Neither could
immediately be reached on
Tuesday.
The Australian regulator
had said in March that it
would bring action against the
mining company and the executives, alleging they had misrepresented the reserves and
resources of the Mozambique
coal assets.
Former Rio Tinto Chairman
Jan du Plessis, who served
from 2009 until this March,
recently called the Mozambique investment “undoubtedly a low point during my
tenure.”
—Rachel Pannett
contributed to this article.
The U.S. dollar surged to its
highest level this year after recent economic data signaled
stronger growth in the U.S.
than other developed nations.
The WSJ Dollar Index,
which measures the currency
against a
CURRENCIES
basket of 16
others, rose
0.6%
to
86.13, its highest since Dec. 28.
The currency rose broadly,
gaining 0.7% against the euro
to $1.1992, 0.5% versus the
Japanese yen to ¥109.86 and
1.1% versus the British pound
to $1.3612.
The dollar has been buoyed
by an array of strong economic data, which has contributed to investors’ expectations
for the Federal Reserve to
raise interest rates four times
in 2018. Fed-funds futures late
Tuesday showed the market
sees a 49% likelihood for four
rate increases, up from 32% a
month ago, according to CME
Group data.
“If you look at monetary
policy expectations outside the
U.S., they’ve shifted” and become less aggressive, said Eric
Viloria, a currency strategist
at Wells Fargo Securities.
That, combined with stronger
U.S. data, has been “contributing to some of the dollar
strength.” Higher interest
rates tend to attract investors
to a currency by offering
higher returns.
The dollar was supported
Monday after the Commerce
Department said inflation hit
the Federal Reserve’s 2% target for the first time in over a
year in March.
Regulators Weigh Treating Virtual Currencies as Securities
BY DAVE MICHAELS
AND PAUL VIGNA
Bitcoin has largely escaped
government oversight, but
regulators are examining
whether other widely traded
cryptocurrencies should be
regulated as securities, according to people familiar
with the matter.
The inquiry includes a focus
on ether, representing a significant threat to virtual currencies, which haven’t been
drawn into a regulatory crackdown on potential fraud in the
market for the assets. Until
now, regulators hadn’t questioned whether rules designed
for stocks should apply to virtual currencies such as ether,
the world’s second most valuable cryptocurrency after bitcoin, with a market value of
about $66 billion.
The analysis, by federal securities and commodities regulators, turns on whether the
creators of virtual currencies
other than bitcoin exert significant influence over their
value, in the same way a com-
Big Five
Top cryptocurrencies by market value
Bitcoin
$153.4 billion
Ether
65.8
Ripple
Bitcoin Cash
EOS
32.6
22.1
14.4
pany’s stock price depends on
its managers and their strategy, performance and investments, the people said. The
Commodity Futures Trading
Commission has deemed bitcoin to be a commodity, meaning it isn’t subject to investorprotection laws enforced by
the Securities and Exchange
Commission.
Some regulators think ether
is in a “gray zone,” but believe
its creation in 2014 was probably an illegal securities sale,
the people said. Silicon Valley
backers such as venture-capital firm Andreessen Horowitz
disagree, saying no particular
Note: As of 4:02 p.m. ET on May 1
Source: CoinMarketCap.com
THE WALL STREET JOURNAL.
person or entity stands behind
ether or is responsible for
driving its value.
Under U.S. law, companies
that issue stocks or bonds
must either register the deal
with the SEC—and give investors extensive disclosures—or
limit the sale to sophisticated
institutions and the rich.
Ether’s founders didn’t register the 2014 sale and sold the
coins to anyone willing to
buy.
Any determination from
regulators that ether is a security could spark a wave of selling and rattle major trading
venues such as Coinbase that
allow investors to buy and sell
it. Coinbase has discussed applying for an SEC license to
operate as a brokerage firm, a
process that could bring the
fight over ether to the surface
because brokers can’t deal in
unregistered securities.
Gary Gensler, a former
CFTC chairman, said in a
speech last week that “there is
a strong case that one or both
of ETH and [Ripple’s] XRP are
noncompliant securities,” using the shorthand for the virtual currencies.
Ether’s backers say it
serves a purpose beyond trading. The virtual currency is
paid to people who run the
Ethereum program on their
computer, a necessary function for a decentralized project. Supporters of ether, including Andreessen Horowitz,
also note that ether is mined—
or created—by that broad
community of users, not any
single person or entity.
Ether “has become so decentralized it should not be
deemed a security,” a group of
venture capitalists including
Andreessen and Union Square
Ventures wrote in a proposal
seeking a broad regulatory exemption, which was submitted
to the SEC in late March.
Coinbase declined to comment on regulators’ questions
about ether.
Cryptocurrency developers
and some of the lawyers representing the industry are
frustrated that the SEC continues to apply an arcane legal test to determine whether
a new generation of assets,
such as ether, fall into the
basket of assets that it regulates.
The “Howey Test,” named
for a 1946 Supreme Court case
involving interests in an orange grove, requires regulators to assert whether the investment was made in a
“common enterprise” and
whether anticipated profits
depend on the efforts of others.
Regulators have studied the
role of central actors, such as
the Ethereum Foundation,
which developed ether and
oversees improvements to its
software network, in driving
the asset’s value. The foundation pays “bug bounties,”
which reward programmers
who fix vulnerabilities in
ether’s code, showing the nonprofit influences improvements that can boost the virtual currency’s value, one of
the people familiar with the
matter said.
Regulators are studying
what other factors account for
fluctuations in ether’s price,
some of which temper the case
for calling it a security. For instance, the government is
looking at how much of its demand stems from people who
use ether to run applications
on the software platform.
A working group of regulators including senior SEC and
CFTC officials are scheduled
to discuss the matter on Monday, one of the people said.
The foundation says it
doesn’t control the supply or
demand of ether and owns
less than 1% of the amount in
circulation.
—Gabriel T. Rubin
contributed to this article.
.
B14 | Wednesday, May 2, 2018
THE WALL STREET JOURNAL.
* ***
MARKETS
Oil Prices Retreat as Dollar Advances
Traders also watch
whether Trump will
abandon the deal on
Iran’s nuclear program
$70 a barrel
87
Tuesday
$67.25
Nymex crude-oil prices
68
WSJ Dollar Index
Tuesday
86.13
86
BY STEPHANIE YANG
Oil prices fell to a two-week
low, weighed down by rising
U.S. crude production, a
strengthening dollar and debate over whether America
will pull out of the Iran nuclear deal.
Light, sweet crude for June
delivery fell $1.32, or 1.9%, to
$67.25 a barrel on the New
York Mercantile Exchange, its
lowest close since April 17.
Brent, the global benchmark,
fell $1.56, or 2.1%, to $73.13.
The rally that brought U.S.
oil futures near $70 this year
has stalled, wavering as traders have focused on whether
the U.S. administration will
decide to scrap the 2015 international agreement to curb
Iran’s nuclear program or keep
the deal intact.
Crude prices rose Monday
after Israeli Prime Minister
Benjamin Netanyahu presented
what he described as new evidence that the Islamic Republic had lied about plans to
build a nuclear weapon. The
news fueled more speculation
that President Donald Trump
will abandon the deal, reimposing economic sanctions on
Iran that would frustrate its
oil output and reduce global
supply.
However, those concerns
eased somewhat Tuesday amid
a lack of strong rhetoric from
the administration, traders
said.
“People started digging
through the rubble and turning around and selling the
market,” said Donald Morton,
who oversees an energy trading desk at Herbert J. Sims &
Co.
Mr. Morton noted that investors have become increasingly bullish on oil prices this
Email: heard@wsj.com
Apple Still
Charges Up
With iPhone
There is some irony to the
fact that Apple chose May
Day to remind the world that
it remains among the most
astute of capitalists.
It proved savvy enough to
continue charging record
prices for its iPhone lineup
more than a decade after
launching the iconic device.
The company posted fiscal
second-quarter results Tuesday that showed only a 3%
increase year over year in
iPhone unit sales, which totaled 52.2 million.
But iPhone revenue
topped $38 billion, up 14%
year over year. That reflects
the launch of the high-price
iPhone X late last year.
Higher iPhone prices
helped the company’s overall
revenue match Wall Street’s
estimates for the quarter despite unit sales falling a bit
short of even recently lowered estimates. Also helpful
was Apple’s growing services
business, which grew 31%
year over year to reach revenue of $9.2 billion for the
quarter.
The results will provide
some relief to worried shareholders. Apple also projected
a total revenue gain of 13%
to 18% for the June quarter,
at the high side of what Wall
Street had been projecting.
That helps to counter at
least some of the more
downbeat rumors of late
about weakening iPhone demand.
It also doesn’t hurt that
Apple’s huge offshore cash
hoard—unlocked by last
year’s tax reform—is being
plowed into a new $100 billion buyback plan and a 16%
boost to the company’s quarterly dividend.
The iPhone may be a
slowing business, but it remains an awfully lucrative
one.
—Dan Gallagher
66
85
64
84
62
83
60
58
82
January
February
March
April
January
February
March
April
Net bullish bets on
crude futures, weekly
U.S. oil production, weekly
U.S. oil inventories, weekly*
Personal-consumption expenditures, change from a year earlier†
500,000 contracts
12 million barrels a day
600 million barrels
2.5%
10
500
8
400
400,000
2.0
300,000
1.5
6
300
4
200
2
100
0
0
200,000
1.0
100,000
0
J
F
M
A
2017
’18
0.5
0
2017
’18
Monthly
2017
’18
*Excluding the Strategic Petroleum Reserve †Seasonally adjusted
Sources: WSJ Market Data Group (price, index); Commodity Futures Trading Commission (bets);
Energy Information Administration (production, inventories); Commerce Department (personal-consumption expenditures)
year, which has exacerbated
some selling pressure in the
face of uncertainty. “The market’s been on a steady march,
ripping every bear they can
find apart,” he said. But investors are “very cautious here,
and they’re willing to move
slowly to the sidelines and
take some profits,” he added.
Meanwhile, a stronger U.S.
dollar has put pressure on
commodities such as oil,
which are priced in the U.S.
currency and become more expensive to foreign buyers
when the dollar rises. On
Tuesday, the WSJ Dollar Index
THE WALL STREET JOURNAL.
rose 0.6% to 86.13, a year-todate high.
“Over the last couple of
weeks, the dollar has been
holding a lot more sway,” said
John Saucer, vice president of
research and analysis at Mobius Risk Group. “There’s a
heightened sensitivity of late.”
Growing output from U.S.
shale producers has also
blunted market enthusiasm.
The U.S. Energy Information
Administration reported Monday that oil production rose to
a record 10.264 million barrels
a day in February.
Analysts and traders sur-
HEARD ON THE STREET
FINANCIAL ANALYSIS & COMMENTARY
Biotechs Get Big Pharma Support
Big Pharma bosses say
they are willing to invest for
the long run. That means
high prices for promising
biotech stocks aren’t likely
to fall anytime soon.
Merck & Co. CEO Kenneth
Frazier said on Tuesday that
the company would prefer
deals that boost the
company’s pipeline to a large
“transformational” deal,
such as a merger of equals.
Pfizer CEO Ian Read also
said Tuesday that he doesn’t
see an attractive large-scale
deal at current prices.
Buying a firm with many
products already on the
market has the advantage of
boosting sales and usually
earnings in the short term
while offering potential cost
savings. But taking a longer
view makes more sense as a
deal strategy these days.
For starters, investors are
unenthusiastic about large
pharmaceutical mergers
right now. Takeda
Pharmaceutical’s shares
have languished since it
Long Game
Merck & Co. Keytruda sales by quarter
$1.50 billion
1.25
1.00
0.75
0.50
0.25
0.00
2015
’16
’17
’18
THE WALL STREET JOURNAL.
Source: FactSet
announced its interest in
acquiring the rare-disease
specialist Shire back in
March. That deal’s price tag
will top $60 billion if it
closes.
Developing a strong
pipeline of potential new
drugs is the most important
job for any management
team in the drug business.
After all, the current jewel in
Merck’s portfolio, cancer
drug Keytruda, originally
was developed by a smaller
company more than a decade
ago.
First-quarter sales of
Keytruda were just shy of
$1.5 billion, or about 15% of
Merck’s quarterly revenue.
Keytruda sales more than
doubled from a year earlier.
Finding the next Keytruda
won’t be cheap. Novartis
bought rare-disease startup
AveXis for nearly $9 billion
last month. Drug giants
Celgene and Gilead
Sciences recently have spent
billions on promising but
commercially unproven
cancer treatments developed
by Juno Therapeutics and
Kite Pharma, respectively.
None of those acquired
companies were generating
meaningful revenue before
their investors cashed in.
But easy money makes
these bets logical even if
these deals don’t pan out
over the long term. Balance
sheets are strong throughout
the sector. As long as
interest rates stay low,
paying cash for growth
potential will be a calculated
risk rather than an act of
desperation.
For biotech investors, that
makes betting on companies
without products on the
market much less risky than
one might expect.
—Charley Grant
veyed by The Wall Street Journal expect government data
due Wednesday to show that
oil inventories increased by
700,000 barrels on average in
the week ended April 27.
The American Petroleum
Institute, an industry group,
said late Tuesday that its own
data for the week showed a
3.4-million-barrel increase in
crude supplies, according to a
market participant.
In a Tuesday note to clients,
Goldman Sachs analysts said
despite strong returns this
year investors are cautious on
the run-up in oil prices, in part
because of skepticism that
gains dependent on limited
production and geopolitical
premiums can be sustained.
Much of oil’s gains this year
have been attributed to efforts
by the Organization of the Petroleum Exporting Countries
and other countries including
Russia to limit production and
eliminate a global glut. Prices
have risen as data have shown
stockpiles around the world
declining and nearing historical averages, which some analysts have heralded as a sign
of the end of oversupply.
Goldman Sachs argues for
owning commodities as returns have exceeded all other
asset classes this year, while
supply has declined and inflation has picked up.
According to the U.S. Commerce Department, the personal-consumption expenditures price index, which is
used to measure inflation, rose
2% in March from one year
ago, the largest increase since
February 2017.
“As inflationary concerns
push interest rates higher,
cross-asset correlations with
commodities decline, and the
diversification benefits rise
with higher rates. Rising geopolitical and trade policy risks
only add to the inflationary
mix in commodities,” Goldman
analysts wrote.
—Christopher Alessi
contributed to this article.
WSJ.com/Heard
OVERHEARD
How blue can you get?
Plenty if you are the guy
running Gibson Guitars, the
iconic Nashville company that
outfitted B.B. King with
“Lucille.”
The famous guitar
company is going bust, and
major shareholders such as
Chief Executive Officer Henry
Juszkiewicz stand to take a
haircut.
Mr. Juszkiewicz was part
of a group of sweet little
angel investors who rescued
the company over 30 years
ago when it also was in
trouble, paying the cost to be
the boss.
Personalities who have
lifted the guitar maker over
the years include famous
musicians such as Jimmy
Page, Pete Townshend and
Elvis Presley.
The magic will continue
with a fresh cash infusion.
This time around, the
company’s savior is senior
secured noteholders.
The thrill is gone.
Tight Rail, Trucking Supply Gives U.S. Companies Angst
Company after company is
complaining that the tight
labor market is making it
harder and more expensive
for them to get their products to customers, creating a
potential drag on profits.
There was International
Paper saying tight rail and
truck availability pushed up
costs. There was PPG Industries grousing about how
hard it was to contract
trucks on short notice. There
was LSB Industries complaining about poor rail service.
The griping may get
louder. The tightness in rail
and trucking is an outgrowth
of an economy that has been
expanding for nine years and
an unemployment rate near
4%. In the struggle to find
workers, some trucking
Freight Line
Change in compensation for
private-transportation and
moving-material workers from a
year earlier
4%
3
2
1
0
2001
’10
Source: Labor Department
companies and railroads are
having to pay up.
“It’s a tough driver market,” said Rick O’Dell, chief
executive of trucking company Saia on its first-quarter
earnings call last week.
“We’re paying $5,000 signing bonuses in places to at-
tract drivers.”
On Friday, the Labor
Department reported that
compensation costs for
private-transportation and
material-moving workers—a
category that includes truck
drivers and railroad workers
—were up 3.7% in the first
quarter from a year earlier.
That compared with a 2.7%
rise for all workers and
marked the biggest gain
since 2004.
In a tight shipping
market, railroads and
trucking companies can pass
increased costs on to their
customers. But it can be
harder for customers to pass
them on, which can cut
profits. Specialty polymer
company PolyOne said an
8% increase in freight costs
knocked $2 million off its
bottom line in the first
quarter.
Some of the freight problems are due to weather and
some can be blamed on
slowdowns that began last
summer at CSX, though the
railroad says these have
been resolved.
Other factors are coming
into play: Starting late last
year, most trucking firms
have been required to record
driver hours on electronic
logging devices. That has
made it harder for truckers
to cheat on driving limits, effectively making the trucking
market tighter.
Electronic logging has
been a boon to railroads,
says Edward Jones analyst
Dan Sherman, because it has
prompted companies to shift
more freight to rail. One
place that is really showing
up is in the intermodal
business—the moving of
containers that can be
switched from rail to truck
to ship. Norfolk Southern
last week said that its
intermodal revenue in the
first quarter was up 19%
from a year ago.
For companies with supply chains that rely heavily
on rail and truck, it all
amounts to a big headache.
Shipping costs will go up,
and bottlenecks will continue.
Halliburton’s chief executive last week said that in
the first quarter he “learned
more about train logistics
than I ever dreamed I
would.” He might be about
to learn even more.
—Justin Lahart
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