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The Wall Street Journal - May 4, 2018

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FRIDAY, MAY 4, 2018 ~ VOL. CCLXXI NO. 104
* * * * * *
DJIA 23930.15 À 5.17 0.02%
NASDAQ 7088.15 g 0.2%
STOXX 600 384.62 g 0.7%
10-YR. TREAS. À 5/32 , yield 2.946%
OIL $68.43 À $0.50
GOLD $1,310.70 À $8.10
Casualties in Syria Fuel Discontent in Lebanon Over Hezbollah
What’s
News
Business & Finance
T
he tax overhaul helped
drive earnings at the
largest U.S. companies, with
over half their combined
profit growth stemming
from a drop in their rates. A1
A who’s who of prominent figures lost a total of
more than $600 million they
had invested in Theranos. B1
Nike’s CEO apologized
to employees for allowing a
corporate culture that failed
to take seriously complaints
about workplace issues. B1
Twitter said it discovered a bug in how it stored
passwords and urged users to change them. B5
A U.S. appeals court
overturned the securitiesfraud conviction of a former
Jefferies bond trader. B10
The Dow recouped a nearly
400-point drop to end 5.17
points higher at 23930.15. The
S&P 500 and Nasdaq fell. B11
GE warned that it might
put its dormant subprime
mortgage business into
bankruptcy protection. B6
Activision reported record first-quarter results,
thanks to increased ingame spending. B3
World-Wide
Chinese military personnel
are targeting U.S. flight crews
in the skies over Djibouti
with a high-powered laser
in a show of harassment,
Pentagon officials said. A1
Trump hatched with
Giuliani the high-risk plan
to disclose on live TV that
he had reimbursed his longtime attorney for buying a
porn actress’s silence. A1
Comments by Trump
and Giuliani about the payment place the president
at the center of questions
about possible campaignfinance violations. A4
U.S. and Chinese negotiators opened the first
round of what are expected to be difficult, recurring talks on trade. A7
U.S. tariff demands have
split the EU’s leading members, with Germany urging
conciliation and France advocating a harder line. A6
Ryan said the House
chaplain will remain in his
post and that he will no longer seek his resignation. A5
North Korea’s Kim reiterated a commitment to denuclearize the Korean Peninsula at talks with a Chinese
envoy, Beijing said. A7
Giuliani said Kim agreed
to release three detained
U.S. citizens, but the White
House cautioned that no
deal had been completed. A7
Missouri lawmakers will
convene a special session to
consider impeaching embattled GOP Gov. Greitens. A3
Arizona teachers are expected to return to school
after the state granted
some of their demands. A3
CONTENTS
Business News B3,5-6
Crossword.............. A10
Heard on Street. B12
Life & Arts....... A10-11
Mansion.............. M1-12
Markets............. B11-12
Opinion.............. A13-15
Sports........................ A12
Streetwise................. B1
Technology............... B4
U.S. News............. A2-5
Weather................... A11
World News....... A6-8
>
s Copyright 2018 Dow Jones &
Company. All Rights Reserved
YEN 109.19
U.S. Says
Chinese
Laser Hit
Pilots
BY GORDON LUBOLD
AND JEREMY PAGE
JOSEPH EID/AGENCE FRANCE-PRESSE/GETTY IMAGES
KKR said it would convert to a corporation from a
partnership in the wake of
changes in the tax code. B1
EURO $1.1988
Skies over East Africa
are latest venue for
rising military tension;
rival bases in Djibouti
Ex-VW CEO Winterkorn
faces criminal charges in the
U.S. for his alleged role in the
German auto maker’s emissions-cheating scandal. B1
Some Facebook staffers
can access users’ profiles
without their knowledge,
while employees are alerted
to internal snooping. B1
HHHH $4.00
WSJ.com
BIG VOTE: Campaign posters dot Tripoli in Lebanon, which on Sunday holds its first parliamentary elections since the war began in
neighboring Syria. Hezbollah’s role in supporting the regime there has given rise to opposition in its heartland, the Bekaa Valley. A8
Trump Gambit Stuns Staff
President and Giuliani
devised surprise TV
disclosure about porn
actress payment
BY REBECCA BALLHAUS
AND PETER NICHOLAS
WASHINGTON—President
Donald Trump hatched with
Rudy Giuliani the high-risk
plan to disclose on live television that he had reimbursed
his longtime attorney for buying a porn star’s silence, leav-
TOMORROW
ing senior aides in the White
House and the rest of his legal
team stunned.
Mr. Giuliani, the former
New York City mayor and recent addition to the president’s legal team for the Russia
investigation,
said
Wednesday on Fox News that
the president had reimbursed
his lawyer, Michael Cohen, for
the October 2016 payment of
$130,000 to Stephanie Clifford,
professionally
known
as
Stormy Daniels, in exchange
for her signing a nondisclosure agreement about an al-
leged sexual encounter with
Mr. Trump in 2006.
White House press secretary Sarah Sanders, who has
for months told reporters that
Mr. Trump had no knowledge
of the payment, said Thursday
that the first time she learned
the president had reimbursed
Mr. Cohen was from Mr. Giuliani’s interview Wednesday.
Several White House aides
were alarmed by Mr. Giuliani’s
move and concerned that he is
operating outside the White
House staff structure, taking
cues from the president and
using the television platform
he commands as a celebrity in
his own right.
“People in the White House
are a little concerned about
what looks like the roller
coaster ride ahead,” one White
House official said.
Election-law experts said
Mr. Giuliani’s revelation
places the president at the
center of questions about possible campaign-finance violaPlease see TRUMP page A4
Remarks on payment raise
legal issues................................. A4
Once Near Death, Morgan
Stanley Gets Its Mojo Back
CEO James Gorman embraces Wall Street’s new mundane style
BY LIZ HOFFMAN
WSJ.
MAGAZINE
japan’s
enchanted
islands
Morgan Stanley had slashed bonuses after
another bad year. Chief Executive James
Gorman, at a Swiss Alps conference, defended the move in a television interview. “If
you’re really unhappy,” he told employees,
“just leave.”
The comment in 2012 rocketed around
Morgan Stanley’s trading floor 4,000 miles
away. In Switzerland, some of Mr. Gorman’s
top deputies, including star merger banker
Paul Taubman, grumbled about the public
rebuke, say people familiar with the episode.
Six years later, Mr. Gorman’s take-it-orleave-it discipline has transformed Wall
Street’s problem child into one of its steadiest performers. Its 2017 profits were nearly
New Tax Law Fattens
Corporate Profits
BY THEO FRANCIS
AND RICHARD RUBIN
The largest U.S. companies
found a new formula for success in the first quarter: larger
pretax profits and smaller tax
bills—mostly compliments of
the federal tax overhaul.
More than half of the combined net-income growth reported by 200 large public
companies for the first quarter
stemmed from a decline in the
companies’ effective tax rates,
a Wall Street Journal analysis
of quarterly financial data
from Calcbench found.
At a third of the companies,
tax expenses fell in dollar
terms even as pretax income
rose, boosted by strong revenue growth and the expanding
economy.
Chip giant Intel Corp.’s pretax profits rose $1.2 billion
over first quarter 2017—but
tax expenses fell by $294 million. Defense contractor Lockheed Martin Corp. said pretax
triple those of 2014. Its market value, as low
as $7 billion during the financial crisis, surpassed $100 billion earlier this year. Morgan
Stanley is more valuable on paper than Goldman Sachs Group Inc., once Wall Street’s undisputed king.
Every big bank has changed since the financial crisis, but none as dramatically as
Morgan Stanley under Mr. Gorman, who took
the top job in 2010. His reboot offers a
glimpse of Wall Street’s future: profitable
enough, and with less of the outsize ambition and ego that drove firms toward the
abyss a decade ago.
Mr. Gorman rose not as a trader or
banker—a Wall Street CEO’s typical roots—
but as a McKinsey & Co. consultant. He axed
Please see BANK page A9
profits rose $325 million in
the March quarter while tax
costs fell $43 million.
The tax savings are helping
to drive profits to new highs
among companies in the S&P
500 index. Overall, first-quarter
after-tax earnings for index
companies were on track
through Wednesday to rise
25.3% over the 2017 period, according to Thomson Reuters.
That would mark the seventh
straight quarter of per-share
profit growth and the strongest
gains in more than seven years.
A cut in the U.S. corporate
tax rate to 21% from 35% was
the centerpiece of the federal
overhaul passed in December,
and lawmakers and tax analysts expected the largest immediate benefits would go to
companies with few foreign
operations and few tax breaks
to lose, such as retailers.
Confirming expectations
that companies would benefit
rapidly: Pretax earnings for
Please see TAX page A8
Don’t Ask the
Rail Agency
About Trains
i
i
i
Despite the name,
it oversees Texas’
oil and gas
BY TAWNELL D. HOBBS
Ryan Sitton of the Railroad
Commission of Texas said
there’s a basic frustration with
his job: People keep asking him
about railroads.
“People don’t know the job,
and they think we are the train
guys,” said Mr. Sitton, an
elected commissioner on the
state’s oldest regulatory agency,
created in 1891.
He estimated that only 1 of
10 Texans knows the commission’s main function, and that it
has nothing to do with railroads, despite elections every
two years to fill one of its three
statewide positions.
The Railroad Commission’s
Please see OIL page A9
WASHINGTON—Chinese
military personnel are targeting American flight crews in
the skies over the East African
nation of Djibouti using a highpowered laser in what amounts
to a new show of Chinese harassment of the U.S. military,
Pentagon officials said.
The incidents, which come
amid heightened tensions between the nations, bolster
longstanding U.S. concerns
about China’s decision to establish its first overseas military outpost close to the largest U.S. military base in Africa.
The encounters also underscore growing concerns about
Beijing’s rise as a military
power in Asia and elsewhere,
including over its construction
of fortified artificial islands in
the disputed South China Sea.
“These incidents are not surprising as they represent an act
just short of war, but indicate
gross, intentional negligence, as
well as complete disregard for
aviation safety and international
norms,” said Trey Meeks, a
principal at the Asia Group research firm. Mr. Meeks, a former pilot and Air Force colonel,
had a previous assignment at
U.S. Pacific Command. “I would
certainly view it as harassment.”
Please see LASER page A7
U.S., China open trade talks
seen as tough, long................ A7
Beijing says Kim spoke of
plans to disarm........................ A7
Tesla Shares
Skid After Call
Tesla’s stock fell 5.6% Thursday,
a day after an uneasy analyst
call with CEO Elon Musk. B3
Tesla's shares, minute by minute
$315 a share
After hours
trading
305
Analyst call
starts
295
Thursday
$284.45
▼5.6%
285
275
Wednesday
Thursday
Source: Factset
THE WALL STREET JOURNAL.
.
A2 | Friday, May 4, 2018
THE WALL STREET JOURNAL.
* ***
U.S. NEWS
Freddie Mac will offer
cheaper loans to
landlords who keep
housing affordable
BY LAURA KUSISTO
Freddie Mac, the country’s
largest backer of apartment
loans, will offer low-cost loans
to real-estate owners willing
to keep their buildings affordable to middle-class families
for years to come.
The move could open up a
new approach to creating and
preserving middle-class housing. It uses market incentives
rather than government subsidies to persuade real-estate
companies to preserve units
for the middle of the rental
market, an area of concern for
policy makers in recent years.
“The supply of workforce
housing is rapidly declining.
There’s an urgent need to preserve what’s there and find
ways that you can effectively
create more,” said David
Brickman, an executive vice
president at Freddie Mac and
head of its multifamily division.
The initiative will offer
lower interest rates to landlords who agree to rent the
majority of units in a building
at levels affordable to tenants
making 80% or less of the
area’s median income, a range
that typically includes nurses,
teachers and police officers.
The units must remain affordable for the term of the loan,
typically about a decade.
To start, Freddie will back
up to $500 million of loans to
Bridge Investment Group, a
Salt Lake City-based landlord
with roughly 30,000 apartments around the country.
Bridge has identified 38 metropolitan areas for investment.
Bridge recently closed on
its first property for the project, a 352-unit apartment
community in the Tampa, Fla.,
area.
Roughly 82% of the units in
the building are considered affordable to tenants making
80% or below of the area’s median income, meaning a twoperson household that earns
about $41,000 or less, according to federal guidelines.
The Tampa metropolitan
area is still relatively affordable, but costs have been rising
CHARLIE KAIJO/TAMPA BAY TIMES/ZUMA PRESS
Relief Planned for Workers’ Rising Rents
Tampa rents increased 1.2% in the first quarter, the 11th-fastest growth among 79 metro areas.
even as it remains one of the
poorest major metros in the
country. Average monthly rents
increased 1.2% in the first
quarter to $1,028, according to
Reis Inc., ranking it 11th among
79 major metros for fastest
rent growth during the period.
“Players have raised rents
to justify returns, and many
residents have been priced
out” of central areas, said
Inna Khidekel, managing director of the capital markets
group at Bridge. Now, she
said, even many of the subur-
ban areas “are at risk of no
longer being affordable.”
Freddie Mac’s apartment
lending helps it fulfill a mandate from the Federal Housing
Finance Agency to lend to underserved communities, because renters tend to be less
U.S. WATCH
The Heat Is On in the Nation’s Capital
GEORGIA
KEVIN LAMARQUE/REUTERS
Probe Begins Into
Military Plane Crash
LET THE SUN IN: Kellye Sims took in the warm weather Thursday in Washington. Friday’s forecast calls for highs in the low 90s.
U.S. military officials took
their first formal steps Thursday
in investigating the crash of a
Puerto Rico Air National Guard
cargo plane a day earlier in Savannah, Ga., that killed the nine
service members on board.
The Air Force said it has established an accident investigation board to determine what
caused the plane to go down
and erupt into flames.
The plane, a 60-year-old
WC-130 Hercules on a training
mission, went down shortly after
takeoff and narrowly missed hitting vehicles and people on the
ground, officials said. Immediately after the late-morning
crash, video and photos showed
billowing gray smoke rising from
the site, with much of the plane
destroyed, except for its tail.
The plane, which was involved in hurricane relief efforts
in Puerto Rico, was part of the
156th Airlift Wing, a unit of the
island’s Air National Guard.
—Nancy A. Youssef
COMMERCE DEPARTMENT
Trolls Grab U.S. Twitter Accounts
BY SAMARTH BANSAL
AND ROB BARRY
Sometime in the past few
years, the official Twitter account for the U.S. Geological
Survey’s National Atlas program
did something unusual: It
started posting politically
charged messages. In Russian.
“It’s time for the West to
cancel sanctions and stop demonizing Russia,” the account
wrote on Feb. 26, 2017, using
Cyrillic script. “In USA Trump’s
popularity is growing amid declining Democrat’s ratings,” it
tweeted a month later.
The messages may have surprised cartographic enthusiasts,
because as of last month, the
handle still appeared on the
government’s list of official accounts, called the Digital Registry. The U.S. had in fact deleted
the National Atlas handle years
earlier—and it was later picked
up by another user.
The federal government’s
troubles combating Russian
trolls spreading fake news isn’t
its only problem on social media. It is also struggling to keep
track of which accounts are its
own, The Wall Street Journal
found. The National Atlas’s handle was one of 10 such Twitter
accounts listed in April as controlled by the U.S. government,
when in fact they were no longer under federal control. Four
were tweeting in languages
other than English.
“In hindsight, it seems like
the government agency should
have kept the Twitter account
even if they weren’t going to
use it,” said Keith Jenkins, a researcher at Cornell University
who used the National Atlas service before it was deleted.
The U.S. launched the registry in part “to confirm the official status” of government social
media accounts, according to the
service’s website. The registry’s
purpose: “To help prevent exploitation
from
unofficial
sources, phishing scams, or malicious entities.”
But the Journal’s findings
raise questions about that
premise, experts said.
“How can we trust the list at
all if some of it is wrong?” said
Libby Hemphill, a professor at
the University of Michigan who
researches social media.
A spokesman for the U.S.
General Services Administration, which maintains the regis-
The federal
government struggles
to keep track of its
official social media.
try, said it was up to individual
agencies to ensure information
is accurate.
Shortly after the Journal
asked about the rogue handles,
a warning popped up on the
service’s website: Accounts
whose registry entries hadn’t
been recently updated had been
“archived,” and wouldn’t be visible to the public.
“This was done to help ensure that users can trust that
accounts listed in the U.S. Digital Registry as official are still
active,” the notice said.
The U.S. Geological Survey,
which operated the National Atlas account, said the Twitter account was archived on July 22,
2015, and the handle scrubbed
from the organization’s website.
But the agency had “neglected
to remove it from the registry.”
“While we do go through and
periodically do checks of accounts in that system, this one
wasn’t caught, unfortunately,”
an agency spokeswoman said.
The account name appropriations appear to happen when a
government account changes its
screen name or gets deleted,
and a new account assumes the
old name.
The Journal also reviewed
government accounts on Facebook, Instagram and YouTube,
but the problem with commandeered handles didn’t appear as
acute. Facebook allows users to
change their page name only
once and Instagram and YouTube have rules about reuse of
old screen names. Twitter users
can recycle screen names—or
change their identity at will.
A Twitter spokeswoman told
the Journal to address questions to the digital registry,
adding the company tries to
work with the government on
account security.
The expropriated screen
names identified by the Journal
included two linked to agencies
of the Department of Homeland
Security, which helps protect
the country from malicious cyber actors.
TSABlogTeam, which as of
November 2014 had about
40,000 followers, was listed as
part of DHS’s Transportation
Security Administration, and
previously tweeted tips for safe
travel.
Now, it appears to be a promotional account operated by
someone using the name Wiley
B. McCall. Its most recent tweet,
on Jun. 4, 2016, said: “Comply
with The 3 P’s Of Advertising and
marketing.” The account didn’t
respond to a Twitter message.
Since the screen name was
taken over, hundreds of people
have interacted with it as if it
were still connected to the TSA,
including one tweet from DHS’s
own Twitter handle, the Journal
found. A TSA spokesman said
the agency was “working to up-
wealthy than homeowners.
Freddie doesn’t make development loans, but backs loans
for purchases of existing
buildings.
Roughly two-thirds of the
$73 billion of multifamily
loans Freddie purchased in
2017 went to apartments affordable to households making less than 80% of the area
median income.
Still, that is down from
three-quarters of its loans
that went to such units in
2013.
More than 60% of U.S. renters earn less than 80% of the
area median income, according to Bridge.
Mr. Brickman acknowledged that Freddie normally
has no oversight over whether
owners will raise rents
sharply after the mortgage giant makes its loans.
As the top end of the market has become saturated, investors increasingly have been
focused on buying midprice
buildings, renovating them
and raising rents.
“There’s nothing about our
typical loan that prevents
someone from raising rents,”
he said.
date the national registry.”
Another ex-DHS account reviewed by the Journal once belonged to the administrator of
the Federal Emergency Management Agency.
The account, CraigAtFEMA,
which in March 2016 had about
54,500 followers, changed its
name after Craig Fugate’s tenure
as FEMA administrator came to
an end in January 2017.
But that update wasn’t made
on the registry listing, and a new
account, also called CraigAtFEMA, soon sprouted. The account says its name is “maja
franjic,” boasts images of a mustached man. Its single tweet, on
Jan. 21, 2017, says: “Just setting
up my Twitter. #myfirstTweet.”
It didn’t respond to a message
from a Journal reporter.
A FEMA spokesman said the
agency would correct the error.
A DHS spokeswoman said the
agency was “currently working
with GSA to ensure they have
the most updated information
on their website.” The spokeswoman said DHS kept a separate, “updated” list on its website—which also turned out to
have errors, including three
Twitter accounts that didn’t exist and one that was suspended.
“It’s shocking something malicious hasn’t happened using this
exploit,” said Justin Littman, a
researcher at George Washington
University who has written about
the appropriation of government
accounts by rogue operators.
Erstwhile official accounts
could have been purloined. The
Journal found three of the government accounts on the registry last month were suspended
by Twitter—a move that typically happens after the platform
determines an account has violated its terms of service.
Twitter urges users to
change passwords.................. B5
Foreign-Trade Deficit
Narrowed in March
The U.S. trade gap narrowed
sharply in March, partly reversing
a widening in the deficit that followed hurricane-related disruptions late last summer.
The international-trade deficit
in goods and services shrank
15.2% from a month earlier to a
seasonally adjusted $48.96 billion
in March, the Commerce Department said Thursday.
It was the largest one-month
decline for the U.S. trade deficit in
two years, taking it to its lowest
level since September. Hurricanes
Harvey, Irma and Maria had disrupted port traffic and damaged
parts of the Gulf Coast and Caribbean in August and September.
Imports dropped 1.8% in March,
“starting to reverse the surge
which followed the hurricanes last
summer, when wholesalers and
retailers had to rebuild inventory
very quickly,” Pantheon Macroeconomics chief economist Ian Shepherdson said in a note to clients.
Meanwhile, U.S. exports
climbed 2% from February to their
highest dollar value on record including larger shipments abroad
of civilian aircraft, soybeans, corn
and crude oil.
—Ben Leubsdorf
WASHINGTON, D.C.
Another Staffer
Is Leaving the EPA
The top spokeswoman for the
Environmental Protection Agency
is leaving the agency, the third departure this week of an aide close
to Administrator Scott Pruitt, who
is facing investigations into management and spending practices.
Liz Bowman’s announcement
follows the exit of two other top
EPA officials—Mr. Pruitt’s head of
security and the administrator of
the Superfund program that
cleans up toxic-waste sites.
She told The Wall Street Journal in an email that she is leaving
for a congressional position, becoming communications director
for Sen. Joni Ernst (R., Iowa).
Ms. Bowman called the new
position “an opportunity I couldn’t
pass up to serve Senator Ernst
and the people of Iowa.”
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.
—Heidi Vogt
CORRECTIONS AMPLIFICATIONS
Beatrice Straight wasn’t
Basil Rathbone’s daughter. The
caption with a photo of the actors that accompanied a Business & Finance article Tuesday
about retail clerks incorrectly
said that she was.
If Real Madrid wins this
year’s Champions League final,
it would become the first team
in the Champions League era
to win three consecutive finals. A Sports article on Tuesday about the team incorrectly
said it would be the first team
to appear in three consecutive
finals.
Readers can alert The Wall Street Journal to any errors in news articles by
emailing wsjcontact@wsj.com or by calling 888-410-2667.
THE WALL STREET JOURNAL
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THE WALL STREET JOURNAL.
Friday, May 4, 2018 | A3
* * * *
U.S. NEWS
NRA Set to Gather, Counter Gun Control
Missouri
Lawmakers
To Weigh
Governor’s
Future
BY SHAYNDI RAICE
Missouri’s Republican-held
House and Senate called a special session to consider impeaching embattled GOP Gov.
Eric Greitens.
The decision Thursday
comes amid mounting pressure on the governor to resign
over criminal charges that he
tied up and photographed an
undressed woman with whom
he was having an affair, without having obtained her consent. He has also been charged
with felony computer tampering over his alleged use of a
charity donor list during his
2016 campaign. His trial begins in St. Louis on May 14.
The special session will begin on May 18.
“The process has monumental consequences, and the
gravity of what we are commencing is not taken lightly,”
said Senate Leader Ron Richard, a Joplin Republican.
The legislators said the special session would give special
committees assigned to investigate allegations against the
governor more time to finish
their work. During the session,
the House can consider articles of impeachment, which
would require a simple majority vote before moving onto
the Senate. The Senate would
appoint judges to conduct an
impeachment trial.
An attorney for Mr. Greitens didn’t respond to a request for comment.
Special sessions are normally called by the governor,
but the state constitution allows the General Assembly to
call itself into a special session
if it has signatures of support
from at least three-quarters of
the members in both the
House and the Senate.
St. Louis Circuit Attorney
Kim Gardner in February
charged Mr. Greitens with
criminal invasion of privacy for
allegedly taking a nude photograph of the woman in the case
without her permission and
transmitting it on an electronic
device. The married governor
had previously admitted to the
extramarital affair but denied
doing anything illegal.
In April, Ms. Gardner added a
felony charge alleging Mr. Greitens misused a charity donor list
during his gubernatorial run.
Mr. Greitens has consistently refused to resign and
has called the charges against
him a “witch hunt.”
On April 18, he posted on
Twitter that in a matter of
weeks “this matter will go to a
court of law—where it belongs
and where the facts will prove
my innocence.”
A firearms examiner worked on the showroom floor in Dallas Thursday as the NRA prepared to host one of its largest annual meetings ever.
and they are outraged,” NRA
spokesman Andrew Arulanandam said.
The convention caps one of
the most prolific fundraising efforts in the NRA’s history. In the
first full month after the Florida shooting, the NRA Political
Victory Fund raised almost $2.4
million, up from $779,000 in
February, according to Federal
Election Commission filings.
The March total was the highest monthly haul in at least a
decade, according to the filings.
Elizabeth Potter, who was at
the convention with her husband for the first time, said she
contributed $1,000 to the NRA
after the Parkland, Fla., shooting because she felt the general
public was being misinformed
about guns. “I just feel like
we’re maligned,” she said.
Attendance won’t be finalized until Sunday. Last year’s
event in Atlanta drew 81,000
people, the second-largest conference for the group. The largest annual meeting was held in
Houston in 2013, drawing
86,000 people.
Gun-control groups and families of gun-violence victims
have planned protests. One local group, Next Generation Action Network, was set to hold a
rally Friday evening near City
Hall. Another organization
planned to stage a “die in” Friday at the Kay Bailey Hutchison
Convention Center, where the
NRA meeting is taking place.
Mayor Mike Rawlings, a
Democrat, said he wasn’t
thrilled about the convention
taking place just weeks after a
Dallas police officer was shot
and killed by a man caught
shoplifting. Mr. Rawlings had
resisted calls to have the convention moved, saying the city
was bound by a contract with
the NRA and hoped the event
would be a chance for both
sides to engage in a dialogue.
He said he was disappointed after having to cancel a forum on
the Second Amendment this
week because the NRA and the
group Everytown for Gun Safety
declined to participate.
The NRA didn’t comment. A
spokesman for Everytown, Andrew Zucker, said, “We already
know where the NRA stands.”
Employers Skeptical of New York Tax Fix
BY RICHARD RUBIN
AND MIKE VILENSKY
New York state lawmakers
found a clever way for employers to help their workers circumvent a new $10,000 federal
cap on state and local tax deductions. Employers, however,
so far aren’t crazy about it.
The idea, which became law
last month, creates a new optional payroll tax that shifts
the state and local tax deduction from individuals who can
no longer fully take it to businesses that can. Employers are
worried about compliance
costs, interactions with union
contracts, complexity across
state lines and the difficulty of
explaining to workers how a
plan that might lead to
smaller pay raises still puts
more money in their pockets.
“It’s a creative approach by
the governor’s office, and I
give them credit for thinking
through issues,” said Peter
Faber, a tax lawyer at McDermott Will & Emery LLP in New
York who advises large corporations. “As my clients consider the practical realities of
implementing the scheme,
they are concerned.”
The Wall Street Journal
asked the 10 largest private
employers in the state and in
New York City, along with all
Fortune 100 companies based
in New York state, whether
they would opt for the new
payroll tax. None that responded said they would do
so, though they have until Dec.
1 to make a decision for 2019.
The state and New York City
are still determining whether
to use the new payroll tax for
their own employees.
That caution is an indication that some of the most
imaginative ways of working
around the new tax law’s restrictions may be tricky to implement on a large scale.
The new payroll tax is part
of the state’s response to last
year’s federal tax law, which
capped at $10,000 the amount
of state and local tax payments that individuals could
deduct from income on their
federal tax forms.
In part because of the new
federal cap, 8.3% of New York
households will get a federal
tax increase in 2018 averaging
$3,340, compared with 6.3%
nationally, according to the
Tax Policy Center, a Washington group led by an Obama administration official.
New York acted faster than
other high-tax states. The law
that included the payroll tax
also has a separate workaround
for the deduction cap. It would
let New Yorkers get tax credits
dividuals are now limited in
doing. But there’s a catch. Employers would likely recover
the cost of paying the state
taxes on behalf of employees
by holding down their salaries.
The net effect of the tax
changes would be less pretax
income for workers, but lower
federal taxes and more aftertax income.
The optional payroll tax
starts at 1.5% of wages above
$40,000 in 2019 and rises to
5% by 2021, below the state’s
top individual income-tax rate.
The Internal Revenue Service could challenge the novel
approach, though many legal
experts believe it complies
with federal law. Even if the
IRS doesn’t challenge it, many
businesses are wary.
“How do you articulate that
somebody in New York is getting a smaller raise than someone in Florida who is doing the
same job?” said David Pope, a
tax lawyer at the law firm
Baker McKenzie. “It becomes
very complex very quickly.”
Pretax income, what people
think of as their salary, is important. It determines future
Social Security benefits and
can affect 401(k) matching
contributions,
employees’
share of health-care premiums
and the starting point for job
negotiations.
More for Less?
How a lower salary could leave a New York resident with more money
under the state’s proposed tax strategy, for a hypothetical single filer:
CURRENT METHOD
If an employee is paid a
$100,000 salary ...
... that last $3,000
in base salary
comes with
$949.50 in federal
income and payroll
taxes.
NEW STRATEGY
The former base salary goes
down by $3,000, but the
employee is better off because
she doesn't pay that $949.50 in
federal taxes ...
BA
She owes at least
$2,850 in state
income taxes.
NK
... and the employer
has, through a new
payroll tax, covered
$2,850 of her state
income tax bill ...
... so she would take
home $799.50
more after-tax pay.
Source: tax experts
THE WALL STREET JOURNAL.
for donations to the state or
certain state-backed charities.
Those donations could then be
claimed as charitable deductions against federal taxes.
New Jersey’s legislature approved a bill last month that
would allow towns and cities to
establish charitable funds that
homeowners could contribute
to in exchange for tax credits
applied toward their propertytax bills. In California, the state
Senate passed a bill in January
that would allow a similar donations-for-tax-credits swap;
the state Assembly hasn’t
voted yet.
Employers who choose to
participate in New York’s payroll tax will pay on behalf of
their workers. The state will
count these payments toward
state income taxes owed by
the workers.
The advantage: Employers
can deduct these payments for
federal tax purposes, which in©T&CO. 2018
DALLAS—About 80,000 people are expected to attend the
National Rifle Association’s annual conference here this week,
among the largest annual meetings ever for the group.
President Donald Trump
and Vice President Mike Pence
are scheduled to speak, as is
Texas Republican Gov. Greg
Abbott and the state’s two Republican senators, Ted Cruz
and John Cornyn.
So many vendors registered
to showcase their wares at the
conference, set to kick off Friday, that the NRA had to waitlist some because there was no
more room at Dallas’s downtown convention center, the
group said. The conference is
taking place as the NRA has
faced a corporate and public-relations backlash.
The gun-control movement
has been re-energized in recent
months, led by survivors of the
Feb. 14 shooting at Marjory
Stoneman Douglas High School
in Parkland, Fla. Traditionally
pro-gun states, such as Vermont and Florida, have since
passed measures to toughen access to firearms, and some major companies have cut ties
with the NRA.
NRA members “feel the Second Amendment and the NRA
have been unfairly targeted,
PATRICK T. FALLON FOR THE WALL STREET JOURNAL
BY DAN FROSCH
AND ZUSHA ELINSON
MATT YORK/ASSOCIATED PRESS
Arizona teachers won a 20% raise by 2020 and a $371 million increase in education funding.
In Arizona, Teachers to Return
To Schools After Muted Victory
BY TAWNELL D. HOBBS
Arizona teachers are expected
to
return
to
school Friday, ending a six-day
strike that shut down schools,
after Gov. Doug Ducey signed
legislation that meets some of
their demands.
Teachers wanted a 20% pay
increase for themselves and
support staff, such as librarians and counselors, among
other requests. The plan approved Thursday grants the
20% raise to teachers by 2020,
but some teacher association
leaders are upset that it
doesn’t include the support
employees.
The bill also boosts education funding by $371 million
over five years to restore
money cut during the recession—far short of the $1 billion requested by the teachers.
“Even though the economy
has recovered, they’re refusing
to give us the restoration of
our yearly funding,” said
Ralph Quintana, president of
the Arizona American Federa-
tion of Teachers. “It’s a step in
the right direction, but it’s not
going to fix the problem.”
Mr. Ducey, a Republican,
lauded the budget. “This is a
real win for our teachers, for
our kids, for our educators in
the classroom,” he said. “It’s a
good way to start the day.”
Parents had scrambled to
find arrangements for their
children during the walkout,
which affected at least
800,000 students in school
districts that closed because
of staffing shortages.
IN BLOOM
INTRODUCING
TIFFANY PAPER FLOWERS™
800 843 3269
|
TIFFANY.COM
.
A4 | Friday, May 4, 2018
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THE WALL STREET JOURNAL.
U.S. NEWS
Former top elections
officials say Giuliani
and Trump intensified
focus on president
BY JULIE BYKOWICZ
AND JOE PALAZZOLO
New comments by President Donald Trump and his
lawyer Rudy Giuliani about a
payment to a former adultfilm star who says she had an
affair with Mr. Trump place
him at the center of questions
about possible campaign-finance violations, two former
Federal Election Commission
leaders said.
Election-law attorneys say
the comments don’t alter the
core legal question: Whether
the 2016 payment of $130,000
to Stephanie Clifford, known
as Stormy Daniels, was related
primarily to the election just
weeks away, or rather to reputational issues that would
have occurred even without
Mr. Trump’s candidacy.
On Wednesday, Mr. Giuliani
said the payment Mr. Trump’s
lawyer Michael Cohen made to
Ms. Clifford—12 days before
the election—violated no laws
because it was part of Mr. Cohen’s routine legal work for
Mr. Trump and because Mr.
Trump reimbursed Mr. Cohen.
Mr. Trump followed up with
a series of tweets Thursday
acknowledging the payment
and saying it was intended “to
stop the false and extortionist
accusations made by her about
an affair.” In return for the
payment, Ms. Clifford signed a
nondisclosure agreement that
barred her from discussing an
alleged sexual encounter with
Mr. Trump in 2006.
The $130,000 payment exceeds the $5,400-per-electioncycle donation limit for individuals, though candidates
lending or donating money to
their own campaigns aren’t
subject to the cap. Still, campaigns have to report loans
and contributions made for
the purposes of influencing
the election.
Mr. Trump’s own lawyer,
Mr. Giuliani, seemed to suggest that the arrangement to
keep Ms. Clifford quiet was intended to protect Mr. Trump’s
campaign. “Imagine if that
came out on October 15, 2016,
in the middle of the last debate with Hillary Clinton,” Mr.
Giuliani said in an interview
on Fox News’ “Fox & Friends”
Thursday morning.
But showing a payment was
made to help a candidate instead of saving him from public embarrassment is a fact-intensive inquiry that will
depend on what evidence federal agents have collected, legal experts said.
Until Wednesday night, Mr.
Trump had denied all knowledge of the payment to Ms.
Clifford, referring questions to
Mr. Cohen.
Last month, federal agents
raided Mr. Cohen’s home, hotel
room and office. He is under
investigation by the Manhattan U.S. attorney’s office for
possible campaign-finance and
money-laundering violations
related to the payment to Ms.
Clifford, as well as other matters, The Wall Street Journal
has previously reported. Mr.
Cohen has denied wrongdoing.
Mr. Trump’s efforts to distance himself from the payment shrank with Mr. Giuliani’s Wednesday interview on
Fox News, and Mr. Trump’s
DREW ANGERER/GETTY IMAGES
Remarks on Payment Raise Legal Issues
Former porn star Stormy Daniels was paid $130,000 in 2016 over an alleged affair with Mr. Trump.
own follow-up tweets, legal
experts said.
“Trump’s admission that he
later repaid Cohen for the
hush money destroys any argument Cohen could have
made that the payment was
out of his own money as an independent expenditure,” said
Trevor Potter, a Republican
former FEC chairman.
Ann Ravel, a Democratic
former FEC chairwoman, said
the changing series of statements about the matter “make
the payment even more worthy of suspicion.”
Charlie Spies, a GOP elec-
tion lawyer, expressed doubt
that the payment was related
to the campaign, and thus subject to federal disclosure rules.
“Mayor Giuliani’s revelation
has no relevance to the election-law legal analysis,” said
Mr. Spies.
“In fact, it may support the
argument that Mr. Trump and
the Trump Organization have
a history of payments to protect reputational issues of him
personally,” he said.
The Federal Election Campaign Act defines campaign
contributions as “anything of
value” intended to influence
the election, including “in-kind
contributions,” or goods and
services provided without
charge or at a discount.
An unanswered question is
when Mr. Trump learned
about the arrangement with
Ms. Clifford. Mr. Giuliani said
Mr. Trump didn’t know about
the payment when it was
made—in the thick of the campaign. Mr. Giuliani said Mr.
Trump repaid Mr. Cohen via a
series of $35,000 monthly payments that began in 2017.
But Mr. Trump would have
had to report the loan if it was
intended to sway the election,
even if he first learned of it afterward, said Jessica Levinson,
a professor at Loyola Law
School in Los Angeles who
specializes in election law.
Mr. Trump could be in
greater peril if he knew about
the payment to Ms. Clifford
contemporaneously and asked
his attorney to front the
money to avoid leaving his
own fingerprints on the deal,
she said. That could give rise
to a charge of conspiring to violate the reporting requirements of the Federal Election
Campaign Act.
Richard Hasen, a law and
political science professor at
University of California, Irvine,
wrote in Slate on Thursday
that records gathered in the
Federal Bureau of Investigation raids of Mr. Cohen could
show whether he intended to
help Mr. Trump’s campaign.
Who Paid and Who Knew? The Saga Behind the $130,000
April 5
The Wall Street Journal
publishes an article saying
that Michael Cohen, a lawyer
for President Donald Trump,
arranged a $130,000 payment
to Stephanie Clifford, a porn
star who goes by Stormy Daniels, to preclude her from publicly disclosing an alleged
2006 sexual encounter. Mr.
Cohen doesn’t address the
$130,000 but says Mr. Trump
vehemently denies any such
occurrence. Mr. Cohen releases
a statement, signed by
“Stormy Daniels,” denying a
sexual and/or romantic affair
with Mr. Trump or receiving
hush money from Mr. Trump.
Mr. Trump, with reporters
on Air Force One, denies
knowing about the $130,000
payment made to Ms. Clifford.
Asked why his attorney, Mr.
Cohen, had made the payment,
the president responds: “You’ll
have to ask Michael Cohen.
Michael is my attorney.” Mr.
Trump also says he didn’t
know where the money for the
payment had come from.
Feb. 13
Mr. Cohen says he “facilitated” the payment to Ms.
Clifford out of his personal
funds. “Neither the Trump Organization nor the Trump
campaign was a party to the
transaction with Ms. Clifford,
EVAN VUCCI/ASSOCIATED PRESS, LUCAS JACKSON/REUTERS
Jan. 12
Asked about the payment on Air Force One in April, Donald Trump said to ‘ask Michael Cohen,’ right.
and neither reimbursed me for
the payment, either directly or
indirectly,” Mr. Cohen said in a
statement. He doesn’t address
whether Mr. Trump reimbursed him directly.
March 5
The Journal reports that
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Mr. Cohen wired the payment to Ms. Clifford on Oct.
27, 2016, and that Mr. Cohen
missed two deadlines that
month to make the payment
because he couldn’t reach
Mr. Trump in the final days
of the presidential campaign,
citing a person familiar with
TRUMP
Continued from Page One
tions. Mr. Trump’s reimbursement of his lawyer for the
payment could violate election law, since Mr. Cohen
likely would have been required to report the funds he
spent upfront as an in-kind
donation, if investigators determine the payment was
made to help Mr. Trump win
the election. Mr. Giuliani on
Wednesday suggested it was.
Mr. Giuliani’s comments departed from the more measured remarks previously
made by the president’s legal
team. They have spent months
trying to draw a distinction—
and a hard line—between the
Russia probe and the more salacious Stormy Daniels scandal
that has largely swirled
around Mr. Cohen. In his comments, Mr. Giuliani conflated
them.
Mr. Giuliani said in a Wall
Street Journal interview
Wednesday that the president
had expressly authorized the
disclosure and was “very
pleased” with how the Fox
News interview had gone.
Mr. Trump, in a series of
early morning tweets Thursday, confirmed that Mr. Cohen
had been reimbursed for his
payment to Ms. Clifford,
though he didn’t say explicitly
who had reimbursed him. The
president said the agreement
with Ms. Clifford was made
“to stop the false and extortionist accusations made by
her about an affair.”
the matter. After the election, Mr. Cohen complained
to friends that he had yet to
be reimbursed for the payment to Ms. Clifford, people
familiar with the matter told
the Journal. Mr. Cohen’s
comment to the Journal was:
“Fake News.”
President Lauds
Religious Rights
April 26
Mr. Trump, in an interview
with Fox News, says that Mr.
Cohen has done “a tiny, tiny
little fraction” of his legal
work, including “this crazy
Stormy Daniels deal he represented me on.”
May 2
Rudy Giuliani, newly hired
as a lawyer for Mr. Trump,
says on Fox News in an interview with Sean Hannity that
the president reimbursed Mr.
WASHINGTON—President
Donald Trump proclaimed the
U.S. “a nation of believers”
Thursday and described his administration’s support of religious rights in a Rose Garden
gathering with faith leaders.
Marking the National Day
of Prayer, Mr. Trump cited his
backing for the annual March
for Life antiabortion rally, steps
his administration has taken to
loosen requirements that religiously affiliated employers
provide contraception to workers, and the faith of Vice Presi-
dent Mike Pence.
“As president I will always
protect religious liberty,” Mr.
Trump said. The White House
said 200 faith leaders were in
attendance.
Mr. Trump has had broad
support among social conservatives and evangelical Christians, winning these voters in
2016 despite concerns about
his past positions on social issues and accusations of sexual
misconduct. That support has
remained firm during his presidency amid enthusiasm over
such moves as his pick of Neil
Gorsuch for the Supreme Court
and his recognition of Jerusalem as Israel’s capital.
—Louise Radnofsky
The disclosure comes at a
tense time for the investigations into whether Trump associates colluded with Russia—which both the president
and Moscow deny—and into
whether Mr. Cohen committed
bank fraud or campaign-finance violations, which he has
denied.
The president and his lawyers have attacked the investigations in recent weeks, and
Mr. Giuliani in a Journal interview referred to a potential
sit-down between Mr. Trump
and special counsel Robert
Mueller as a “bulls—interview
that should never be taking
place.”
Several White House aides
didn’t learn that Mr. Giuliani
planned to speak to Fox News
until he was live on the air.
One official said the interview
left the West Wing “completely frozen.”
Mr. Trump last month denied any knowledge of the
payment to Ms. Clifford, telling reporters aboard Air Force
One that he was unaware of it
or of where the money came
from.
The White House on Thursday sought to explain that denial by saying Mr. Trump
wasn’t aware at the time that
he had reimbursed Mr. Cohen.
Mr. Giuliani said the president
first realized he had reimbursed his lawyer—through a
monthly retainer starting in
2017—last week when they
discussed the payment, which
the Journal first reported in
January.
While some White House
officials were kept out of the
loop on Wednesday’s an-
Cohen for the $130,000 payment to Ms. Clifford. Mr. Giuliani says the agreement was
made to “stop the false and
extortionist accusations made
by her about an affair.” Mr.
Giuliani says the president had
reimbursed Mr. Cohen in
monthly
installments
of
$35,000 throughout 2017, and
that the payments were perfectly legal. “It’s not campaign
money. No campaign finance
violation.”
May 3
Mr. Trump tweets: “Mr. Cohen, an attorney, received a
monthly retainer, not from the
campaign and having nothing
to do with the campaign, from
which he entered into, through
reimbursement, a private contract between two parties,
known as a non-disclosure
agreement, or NDA.” He continues: “These agreements are
very common among celebrities and people of wealth.”
nouncement, Mr. Giuliani
dined that same evening with
Corey Lewandowski, the president’s former campaign manager, who has been in increasing contact with Mr. Trump in
recent months.
Mr. Lewandowski is one of
a handful of the president’s associates who have recently
been granted the ability to call
Mr. Trump directly, rather
than being routed through the
switchboard, according to an
administration official—a new
protocol that White House
chief of staff John Kelly put in
place when he started last
summer.
Mr. Trump added Mr. Giuliani to his legal team because
he wanted a stronger TV presence who could adopt a more
aggressive approach to the
Mueller investigation, according to people familiar with the
decision.
Some viewed Mr. Giuliani’s
TV blitz—in which he not only
revealed the reimbursement
but also described Jared Kushner, the president’s son-in-law,
as “disposable,” and said
North Korea planned to release three U.S. prisoners on
Thursday—as the lawyer simply easing into his role.
David Bossie, a former
Trump campaign aide who is
close to the White House, said
of Mr. Giuliani: “You get a lot
of different value added with
Rudy Giuliani. You get his legal and intellectual abilities,
but you also get his media
savvy.”
—Louise Radnofsky and
Joshua Jamerson
contributed to this article.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | A5
U.S. NEWS
SCOTT MCCLOSKEY/THE INTELLIGENCER/ASSOCIATED PRESS
Ryan Reverses,
Asks Chaplain to
Remain in Post
BY BYRON TAU
West Virginia Bid Loses Momentum
BY SIOBHAN HUGHES
AND KRIS MAHER
Barbara Hepworth, detail of Maquette for Dual Form
Image courtesy of Richard Green, London
MORGANTOWN, W.Va.—Don
Blankenship, a former West
Virginia coal executive who
served a year in prison for a
mine-safety conviction, lost
momentum in his U.S. Senate
bid when a Washington-based
Republican group recently
moved to block his candidacy.
But he isn’t going down without a fight in Tuesday’s GOP primary. Mr. Blankenship is making a last stand in debates and
digital and television ads covering the state, where he once ran
Massey Energy Co., the operator of a coal mine where 29 people died in a 2010 explosion.
His leading opponents are
Rep. Evan Jenkins (R., W.Va.), a
former Democrat and onetime
state legislator, and state Attorney General Patrick Morrisey,
who have edged ahead in polls.
A Fox News poll taken between
April 18 and April 22 put Mr.
Jenkins in the lead with 25% of
likely GOP primary voters, followed by Mr. Morrisey, with
21%, and Mr. Blankenship, with
16%. Three other GOP contenders were below 10%.
Republican Party officials
see both of Mr. Blankenship’s
leading primary opponents as
better candidates to take on
Sen. Joe Manchin (D., W.Va.)
and possibly expand by one
their 51-49 Senate majority.
President Donald Trump won
West Virginia by 42 percentage points—the biggest margin
of any of the 10 states where
Senate Democrats are now defending their own seats.
Senate Majority Leader Mitch
McConnell (R., Ky.), asked about
the West Virginia primary recently, said, “We will wait to see
who the nominee is and get behind a Republican candidate.
Former coal executive
Don Blankenship is
vying for a U.S.
Senate seat.
And hopefully it will be one who
is actually electable.”
But Mr. Blankenship is convinced that Mr. Trump’s victory is a sign that his own outsider candidacy has a shot.
“We are probably a whole lot
closer now than people think because of the hidden vote and because of the fact that there will
be a lot of people that turn out
that aren’t in the polls, sort of
like the Trump thing,” Mr. Blankenship said in a Monday interview outside of Charleston,
where he was the only one of
the three major contenders to
show up for a candidate forum
at West Virginia State University. He was referring to a detail
in the Fox News poll that
showed 7% of respondents
didn’t favor any of the six candidates and 24% were undecided.
Mr. Blankenship’s primary
residence is in Nevada, where he
moved after being indicted several years ago, and he is campaigning in West Virginia on supervised release. His one-year
probation ends the day after the
primary. Mr. Blankenship’s assertion that the mine disaster was
caused by federal mine-safety
regulators and covered up by the
Justice Department has resonated with some voters here.
“They set him up to get
killed—I don’t believe he is
guilty of killing anybody,” said
Kathy Parker, a 52-year-old business owner from Mingo County,
where Mr. Blankenship owns a
home, who showed up to root
for him at a Tuesday debate.
She isn’t alone in agreeing
that his prosecution was politically motivated. “We don’t put
people in jail for a year for a
misdemeanor,” said Lou Hamrick, 84, who owns a miningequipment company in Morgantown and said he would
vote for Mr. Blankenship.
Mr. Blankenship’s candidacy
was surging until a group called
Mountain Families PAC, which
is associated with Mr. McCon-
nell and isn’t required to disclose donors until after the primary, began spending money
last month on ads pummeling
the former chief executive.
In three of the past four
weeks, the group has outspent
Mr. Blankenship’s campaign on
TV, according to Kantar Media/
CMAG data. In all, Mountain
Families PAC has spent about
$1.3 million on ads attacking
him. One 30-second spot says
the candidate’s company
pumped “toxic coal slurry” into
local drinking water. The narrator asks, “Isn’t there enough
toxic sludge in Washington?”
The ad refers to a lawsuit
filed by residents in Mingo
County who alleged their
drinking water was contaminated by coal waste injected
underground by Massey when
Mr. Blankenship was an executive. A company that bought
Massey settled the suit in 2011
without admitting wrongdoing.
Some voters say Mr. Blankenship is tainted. Renee Jones-Wagner, a 63-yearold from Berkeley County, said
she supports Mr. Morrisey because he is an antiabortion advocate and took a stance against
allowing transgender people in
public school to use the bathroom corresponding with the
sex with which they identify.
—Julie Bykowicz
contributed to this article.
J. SCOTT APPLEWHITE/ASSOCIATED PRESS
Senate candidate Don Blankenship, far left, once ran Massey Energy, the operator of a coal mine where 29 people died in a 2010 explosion.
WA S H I N G T O N — H o u s e
Speaker Paul Ryan said Thursday that the chamber’s chaplain will remain in his post
and he will no longer seek his
resignation, after the chaplain
publicly questioned why he
was being asked to step aside
and reversed his earlier decision to quit.
Mr. Ryan’s decision could
defuse growing tensions over
the chaplain’s fate. The news
of the Rev. Patrick Conroy’s
resignation last month roiled
the House, with many lawmakers pressing for an explanation
about why he was asked to resign by Mr. Ryan.
Mr. Ryan’s shift came after
Father Conroy said in a letter
to Mr. Ryan that a top aide to
the speaker said he should
leave in part because of a
prayer about the Republican
tax law and because of his
Catholic faith.
Father Conroy, a Jesuit
priest, in his letter Thursday
rescinded his resignation, essentially telling the speaker
that if he wanted him to leave
his post he would have to fire
him. He also said that the aide,
Mr. Ryan’s chief of staff Jonathan Burks, in April told him
The Rev. Patrick Conroy
he was being replaced in favor
of a non-Catholic and because
of comments he had made in a
prayer and to the media.
“I inquired as to whether or
not it was ‘for cause’ and Mr.
Burks mentioned dismissively
something like ‘maybe it’s
time we had a chaplain that
wasn’t a Catholic,’ ” Father
Conroy recounted in the letter.
Mr. Burks “also mentioned my
November prayer and an interview with the National Journal
Daily,” Father Conroy added in
the letter.
Mr. Burks disputed that
characterization of the conversation. “I strongly disagree
with Father Conroy’s recollection of our conversation. I am
disappointed by the misunderstanding, but wish him the
best as he continues to serve
the House.”
In his statement, Mr. Ryan
said his decision to ask for Father Conroy’s resignation was
“based on my duty to ensure
that the House has the kind of
pastoral services that it deserves.” But, he added, “It is
my job as speaker to do what
is best for this body, and I
know that this body is not well
served by a protracted fight
over such an important post.”
In the morning prayer on
Nov. 6, Father Conroy had
asked that lawmakers’ “efforts
these days guarantee that
there are not winners and losers under new tax laws, but
benefits balanced and shared
by all Americans” as the Republican-led Congress was debating tax legislation that
would ultimately be passed
into law in December.
In the interview with the
National Journal, Father Conroy discussed several controversial issues, including workplace sexual assault and
harassment on Capitol Hill as
well as anti-Catholic prejudice
in Congress.
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THURSDAY, MAY 3, 2018
5–8PM
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MAY 3, 2018 (INVITATION ONLY)
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MAY 4-8, 2018
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FOR BENEFIT TICKETS:
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.
THE WALL STREET JOURNAL.
A6 | Friday, May 4, 2018
WORLD NEWS
U.S. Tariff Threats Split France, Germany
Berlin backs minideal
on trade, while Paris
takes hard line, fearing
broader demands
More to Lose
Germany’s large trade surplus
with the U.S. makes it more
eager than France to resolve a
trade spat with Washington.
The European Union’s leading members are at loggerheads over how to react to
Washington’s tariff threats,
with Germany urging conciliation and France advocating a
harder line, senior officials said.
Trade with the U.S. in 2017
€125 billion
Exports
Germany, whose export-led
economy would have much to
lose in a trade conflict, wants
to offer President Donald
Trump what officials call a
mini trade deal, including
lower import tariffs for U.S.
cars. France is opposed, however, fearing Mr. Trump would
see the move as a sign of weakness and raise his demands.
Until now, EU capitals have
maintained unity against Mr.
Trump’s criticism of U.S. trade
deficits with individual EU nations, notably Germany.
The deadlock is such that
the talks have now become entangled with separate negotiations over a proposed overhaul of the eurozone, with
ALEXANDER KOERNER/GETTY IMAGES
75
By Bojan Pancevski
in Berlin and William
Horobin in Paris
50
25
0
France
Note: €1=$1.20
THE WALL STREET JOURNAL.
German officials saying Paris
is pressuring them to offer
concessions on the latter in
exchange for progress on
trade, something Paris denies.
Mr. Trump has extended a
deadline to June 1 for the EU,
which handles trade negotiations for all of its members, to
respond to his threat to levy
punitive steel and aluminum
tariffs. The EU has vowed to
panies investing in the U.S. and
in Germany,” Mr. Altmaier, a
confidant of Chancellor Angela
Merkel, said on Tuesday.
But a German official said
France was opposing the idea.
“Of course the French are in a
comfortable position because
not a single Citroën gets sold
to America while the entire
German car industry is exposed to this,” the official said.
Previous forecast
BY EMRE PEKER
Current forecast
Eurozone
2
0
–2
–4
–6
2007
’10
Source: European Commission
’15
starting a negotiation with the
U.S. over what he described as a
much simpler version of the
failed Transatlantic Trade and
Investment Partnership, or TTIP.
“There should be a possibility of fair agreement that will
be much less ambitious and
complicated and much narrower
in scope [than TTIP].…We need
to provide a safe, reliable and
predictable framework for com-
’19
THE WALL STREET JOURNAL.
BRUSSELS—The European
Union unveiled an upbeat economic outlook for the eurozone, but warned of rising
risks from President Donald
Trump’s protectionist trade
policies and of the U.S. economy overheating.
As the currency union enjoys its strongest growth in a
decade after years of crisis,
the EU’s potential trade war
with the U.S. over steel and
aluminum tariffs is weighing
on what some officials and an-
alysts have called the “euroboom.”
U.S. trade policies pose an
“unambiguously negative risk”
to the global economy that
threaten the eurozone’s fiveyear expansion, the EU’s executive—the European Commission—said on Thursday. EU
officials are racing against a
June 1 deadline to clinch permanent exemptions from Mr.
Trump’s tariffs of 25% on steel
and 10% on aluminum imports,
with no quick and clear path
for an agreement.
Gross domestic product in
the 19-member eurozone is set
to grow by 2.3% in 2018, easing to 2% expansion next year,
the EU said in its quarterly report, in line with earlier forecasts. The economy grew by
2.4% in 2017.
“The biggest risk to this
rosy outlook is protectionism,
which must not become the
new normal,” said Pierre Moscovici, EU commissioner for
economic and financial affairs,
taxation and customs.
Another threat stems from
the president’s stimulus measures, including tax cuts,
which could result in a faster
pace of interest-rate increases
by the Federal Reserve if the
U.S. economy overheats, the
EU said.
Fed Chairman Jerome Powell said in April that gradual
rate increases will help the
U.S. economy grow without
overheating, as some of his
deputies warned of the risk.
That, along with Mr.
Trump’s trade measures, could
contribute to financial-market
volatility, which is “likely to
become a more permanent
feature,” Mr. Moscovici said.
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4%
respond with countermeasures, including upping tariffs
for U.S. product groups such as
jeans and whiskey, which could
trigger a tit-for-tat conflict
leading to higher tariffs that
Berlin fears could ensnare the
country’s flagship car industry.
German Economics Minister
Peter Altmaier said EU countries had to first reach an agreement among themselves before
Trump’s Trade Policies Weigh on ‘Euroboom’
Economic growth is taking hold in the eurozone, but
protectionist U.S. policies threaten to curb the recovery.
Reported
Germany
Source: Eurostat
Porsche cars destined for export were lined up at the port in Bremerhaven, Germany, in March.
Growth Path
GDP growth
Imports
100
He added that Paris had
linked the discussion on trade
with talks about shoring up the
EU’s common currency, where
Berlin has so far adopted an
uncompromising position and
rejected most of France’s suggestions. French President Emmanuel Macron’s proposals include more risk-sharing and
substantial common investment, anathema in Berlin due
to fears that the country would
end up footing the bill for less
fiscally solid members.
A French official said Paris
was treating the issues separately, adding, “It’s very different and too important to trade
one thing for another.”
French officials say there
are technical barriers to a
minideal as trade talks under
WTO rules would have to apply to a wide range of sectors.
“It’s clear we don’t want a
TTIP-light,” he said.
Ms. Merkel and Mr. Macron
will discuss the matter at an
EU summit this month, several
officials confirmed.
So far, European officials say
a majority of member states
and the European Commission,
the EU’s executive body, are
leaning toward the French line
and against Germany’s moreaccommodating stance.
—Emre Peker in Brussels
contributed to this article.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | A7
WORLD NEWS
Beijing:
Kim Spoke
Of Plans
To Disarm
BY CHUN HAN WONG
faster resolution of the market-rattling conflict, according
to people tracking the negotiations. Mr. Mnuchin is in
charge of negotiations on financial services, which are
much closer to resolution than
other issues, they said.
The size of the U.S. delegation and the divisions make
quick resolutions more difficult. Should all of the U.S.
members talk at the meetings
and listen to responses from
Chinese officials of similar
rank, through translation, the
talks, at the government’s Diaoyutai guesthouse complex,
could drag on for hours.
“Negotiating by committee
is awfully hard,” said Stefan
Selig, the top international
economic official in the Obama
Commerce Department.
—Bob Davis in Washington
contributed to this article.
Pyongyang to Free U.S. Prisoners, Giuliani Says
BY MICHAEL C. BENDER
AND JESSICA DONATI
WASHINGTON—President
Donald Trump’s attorney Rudy
Giuliani said North Korean
leader Kim Jong Un agreed to
release three detained U.S. citizens, but the White House
cautioned that no deal had
been finalized and declined to
discuss negotiations for the
prisoners.
“We can’t confirm the validity of any of the reports
currently out about their release,” White House press secretary Sarah Sanders said on
Thursday. “But we certainly
would see this as a sign of
good will if North Korea were
to release the three Americans
ahead of discussions with
President Trump and Kim
Jong Un.”
Another White House official said no deal has been fi-
nalized on the release of the
three detainees.
Mr. Giuliani raised expectations earlier Thursday when
he said in an interview on Fox
News that the president had
reached an agreement to release the U.S. citizens.
“We got Kim Jong Un impressed enough to be releasing
three prisoners today,” Mr.
Giuliani said. He didn’t respond
to requests to comment.
Mr. Kim gave assurances to
Secretary of State Mike
Pompeo that the release of the
detainees could be paired with
a summit with Mr. Trump, The
Wall Street Journal reported
on April 20. Mr. Trump signaled on Twitter late Wednesday that there would be news
soon. He said the previous administration hadn’t been able
to free the “three hostages,”
adding: “Stay tuned!”
Two of the detainees were
People in Seoul watching a TV report on the three U.S. detainees.
taken into custody since Mr.
Trump has been president.
The release of detained U.S.
citizens would add to a rapid
diplomatic advance that began
before the Winter Olympics in
South Korea with a thaw between Seoul and Pyongyang.
After the Games and assurances from Mr. Kim that he
was open to talks on “denuclearization,” Mr. Trump agreed
in March to the North Korean
leader’s proposal for a summit, which is expected to be
held by mid-June.
LASER
Continued from Page One
The laser incidents prompted
U.S. officials to complain to the
Chinese and to request an explanation. Chinese officials said
they are looking into the matter, U.S. officials said.
Neither the Chinese Embassy in Washington nor
China’s Defense Ministry responded to a request to comment. Chinese officials in the
past have complained about
foreign military reconnaissance
planes flying over China’s Djibouti outpost, people familiar
with the matter said.
The new signs of military
tension also come as U.S.-China
economic relations have sunk to
their lowest point in decades.
President Donald Trump says
he considers Chinese counterpart Xi Jinping a friend, but has
imposed tariffs on some Chinese goods and is threatening
tariffs on $150 billion more,
while his administration has imposed new restrictions on U.S.
technology exports to China.
There have been four incidents over the past several
weeks at Djibouti, military officials said. Three involved the
use of a military-grade laser
that appeared to be coming
from or near a logistics area of
the Chinese base, those officials
said. A fourth incident, as recently as two weeks ago, didn’t
employ a military-grade device
and appeared to come from a
different location, but officials
declined to specify where.
In one of the most recent incidents, two American service
members piloting a C-130 turboprop experienced minor eye
injuries after being exposed to
the laser beam, a Pentagon official said. The pilots experienced dizziness and seeing
“rings,” the official said, and
are now recovering.
Military officials also con-
China held its first joint maritime exercises with Djibouti last year and is building a naval outpost there.
firmed that there have been an
undisclosed number of incidents involving lasers within
U.S. Pacific Command, which
encompasses the Pacific and
Asia, where the U.S. and Chinese militaries have frequent
encounters. But one official said
those laser incidents, while under investigation, haven’t been
formally blamed on the Chinese.
Lasers are often used by
saboteurs at commercial airports to distract or temporarily
blind civilian jet pilots, typically
as they are landing a plane and
the potential for accidents is
high, experts have said.
Devices that project laser
beams have legitimate military
uses, such as to help designate
targets for aircraft, as target
sights for hand-held weapons,
or to temporarily blind advancing enemy troops in combat.
The military issued an internal notice, posted on the
Federal Aviation Administration website, to warn pilots of
the potential risks, referring in
April to the laser used as
“high-powered” and urging pi-
Too Close for Comfort
The U.S. and China have military bases only several miles apart in
the tiny African nation of Djibouti.
1 mile
1 km
Djibouti
China’s military outpost
EGYPT
SUDAN
SAUDI
ARABIA
Gulf of
Aden
Djibouti-Ambouli
International Airport
ea
KIM WON-JIN/AGENCE FRANCE-PRESSE/GETTY IMAGES
Kudlow, White House trade adviser Peter Navarro and Commerce Secretary Wilbur Ross,
among others—was approved
by President Donald Trump to
see if Beijing is willing to make
significant changes in policy.
Messrs. Lighthizer and Navarro favor a tough, broadbased approach to China and
the use of tariffs as leverage,
while Messrs. Mnuchin and
Kudlow are looking for a
dS
China’s Wang Yi, left, with
North Korea’s Ri Yong Ho
U.S. companies to give up important technology to get access
to the giant Chinese market.
Chinese officials respond
that U.S. companies willingly
enter into contracts with Chinese firms and deny they are
giving domestic firms an unfair advantage.
The trip by a bevy of senior
U.S. officials—the contingent
also includes National Economic Council Director Larry
Re
BEIJING—North
Korean
leader Kim Jong Un reiterated
a commitment to denuclearize
the Korean Peninsula at a
meeting with a senior Chinese
envoy in Pyongyang, China’s
Foreign Ministry said.
At their Thursday meeting,
Mr. Kim told Chinese Foreign
Minister Wang Yi that “realizing the denuclearization of the
peninsula is North Korea’s
firm stance,” the ministry said.
Mr. Kim’s reported remarks
echo assurances he made to
South Korean President Moon
Jae-in in their summit last
week and to Chinese President
Xi Jinping in their meeting in
Beijing in March, according to
Seoul’s and Beijing’s official accounts of those conversations.
Pyongyang and North Korean
state media haven’t directly
quoted Mr. Kim as making a
commitment to denuclearize.
North Korea’s willingness to
discuss denuclearization is a
focal concern for Washington in
its talks with Pyongyang over a
planned summit between Mr.
Kim and U.S. President Donald
Trump. The absence of such a
pledge by Mr. Kim in official
North Korean accounts of his
summits with South Korean
and Chinese leaders has raised
doubts among some officials
and analysts.
Pyongyang’s official Korean
Central News Agency has published the joint declaration
signed last week by Messrs.
Kim and Moon stating that
their governments shared the
goal of “realizing, through complete denuclearization, a nuclear-free Korean Peninsula.”
KCNA also reported that the
two Korean leaders discussed
the “denuclearization of the
peninsula” during their summit.
On Thursday, Mr. Wang told
Mr. Kim that Beijing supports
the two Koreas’ joint plan to
formally end hostilities, as well
as North Korea’s efforts to safeguard its own security while
advancing the denuclearization
process, the ministry said.
U.S. Treasury Secretary Steven Mnuchin, center, in Beijing on Thursday, is looking for a fast resolution of trade tensions with China.
AHN YOUNG-JOON/ASSOCIATED PRESS
BEIJING—Trade negotiators
from the U.S. and China are
digging in for the first round
of what they expect to be recurring, difficult talks that
don’t produce an immediate
settlement.
Beijing is bracing for lengthy
sparring with Washington,
though Chinese officials said
that in recent weeks they had
tried to get the relationship
with the U.S. back on track,
pointing to a recent acceleration
of plans to give foreign investors greater access to the financial-services and auto sectors.
“China has shown goodwill
and there is still room for negotiation,” a senior government official said. “We need to
understand each other’s intentions first, and we need to sit
down and talk.”
U.S. Trade Representative
Robert Lighthizer, Treasury
Secretary Steven Mnuchin and
other senior Trump administration officials opened the discussions Thursday afternoon with
Chinese negotiators. Neither
side commented substantively
on the talks, with the first round
scheduled to end on Friday.
Mr. Lighthizer laid out a
long time frame in remarks
before jetting off to Beijing.
“We’re going to spend the
next year developing how we
deal with each other,” he said
on Tuesday in Washington.
“Over a period of time, you
end up knowing how to deal”
with the problems dividing the
two nations, he said.
A Chinese government
spokesman said ahead of the
U.S. team’s arrival that Beijing
is prepared should a protracted trade fight ensue.
There are a number of reasons for tamped-down expectations from the talks. First,
both sides are far apart on
significant issues, especially
how to deal with Beijing initiatives that Washington says favor state-owned Chinese companies at the expense of
American businesses. Second,
the U.S. hasn’t put together its
bottom-line expectations for
China to head off tariffs and
other restrictions threatened
by the administration.
Both governments have different views of their disputes.
For the U.S., the chief issue is
the direction of Chinese industrial policy. The U.S. complains
that the government is taking a
bigger role in Chinese companies, aiding them with financial
and other subsidies and forcing
CHINESE NAVY
BY LINGLING WEI
JASON LEE/REUTERS
U.S., China Start
Trade Talks Seen
As Tough, Long
ERIT. YEMEN
Camp Lemonnier
U.S. military base
Detail
DJIBOUTI
ETHIOPIA
Indian
Ocean
SOMALIA
Source: Google (image)
lots to use “extreme caution.”
“The U.S. has notified airmen
to exercise caution when flying
in certain areas in Djibouti,”
said Maj. Sheryll Klinkel, a Pentagon spokeswoman. “This notice was issued due to lasers be-
DJIBOUTI
THE WALL STREET JOURNAL.
ing directed at U.S. aircraft on a
small number of separate occasions over the last few weeks.”
“Lasers pointed at aircraft
have the potential to cause serious harm to the aircrew and
the surrounding area,” she said.
North Korea’s longest-held
American prisoner is businessman Kim Dong-chul, who was
detained in 2015. The 62-yearold Virginia resident was convicted of obtaining classified
documents about North Korea’s nuclear and military
plans and sentenced in 2016 to
10 years of hard labor.
In April 2017, the North’s
state-controlled Korean Central News Agency reported the
arrest of an American professor named Kim Sang-duk, or
Tony Kim. Mr. Kim had been
teaching a class at the Pyongyang University of Science and
Technology,
which
was
founded by a Christian KoreanAmerican businessman.
The news agency confirmed
the detention of a third American, Kim Hak-song, in May
2017. He also worked at the
Pyongyang University of Science and Technology.
In response, aircrews have
begun to use eye protection or
use visors as shields against
the lasers. American pilots also
are checking their flight plans
to ensure flight operations
don’t conflict with air operations by the Chinese military or
other nations’ militaries in the
vicinity, an official said.
Officials said the laser used
likely came from the Chinese
base nearby. “The grade of the
lasers are of military grade,”
Maj. Klinkel said. “The reports
by the pilots were that they
came from the direction of the
Chinese base nearby.”
Djibouti is home to a large
base used by the U.S. that
hosts about 4,000 American
service members and the U.S.
Joint Task Force-Horn of Africa at what is known as Camp
Lemonnier. The base is used to
conduct security force assistance and counterterrorism
operations across Africa and
in Yemen and for other areas
within the military’s U.S. Central Command area.
Djibouti also hosts German,
Spanish, Italian and Japanese
forces, mostly for antipiracy
patrols. China has taken part
in those patrols since 2008,
and says it will use its Djibouti
outpost to provide logistical
support for them, as well as
its peacekeeping and other operations in the region.
Some experts said the use of
the laser amounted to the kind
of aggression the Chinese have
displayed on other occasions.
In 2014 over the South
China Sea, a Chinese jet fighter
pilot conducted so-called barrel rolls around an American
P-8 surveillance jet. That incident led the U.S. to lodge a
formal diplomatic complaint
with Chinese officials and the
pilot was ultimately removed
from the unit, American officials said at the time. China’s
Defense Ministry publicly dismissed the U.S. complaint as
groundless at the time.
.
A8 | Friday, May 4, 2018
* *
THE WALL STREET JOURNAL.
WORLD NEWS
Hezbollah Faces Rising Ill Will in Lebanon
Sending troops to aid
Syrian regime rankles
voters in Bekaa Valley
who want more jobs
BRITAL, Lebanon—Hezbollah has expanded its regional
clout by recruiting thousands
of young men from Lebanon’s
Bekaa Valley to fight in Syria.
But the war next door is producing a tide of discontent at
home for the Lebanese militia
and political group ahead of
elections on Sunday.
Critics point to Hezbollah’s
failures to produce muchneeded economic progress in
its Shiite heartland and complain about the dominant influence Iran wields through it
in Lebanon.
“Hezbollah is now part of
Iran. It is not good for Lebanon, or for Shias,” said Sheikh
Abbas Jawhari, an influential
Shiite cleric campaigning
against Hezbollah for a civilsociety electoral group called
Dignity and Development.
Mr. Jawhari, who joined
Hezbollah in the 1980s at age
16 but later grew disillusioned,
is among the critical clerics,
former fighters and families of
fallen militiamen who have
emerged as the group’s ad hoc
opposition in an area where it
has long had no discernible
competition.
Few places are as important
JACOB RUSSELL FOR THE WALL STREET JOURNAL (2)
BY SUNE ENGEL RASMUSSEN
AND NAZIH OSSEIRAN
The graves of Hezbollah fighters killed in Syria in a cemetery in Brital in Lebanon’s Bekaa Valley, where a campaign poster promotes a candidate running against Hezbollah.
to Hezbollah as the Bekaa, a
fertile valley in northeastern
Lebanon. More than 1,200
Lebanese Hezbollah fighters
have been killed in Syria since
2012, according to Ali Alfoneh,
a nonresident fellow at the Atlantic Council, a Washington
think tank.
Some 28% of those killed
came from the Baalbek-Hermel
governorate in the Bekaa—the
heart of the valley, with a population of 400,000—according
to the Washington Institute, a
research organization tracking
the war in Syria.
Reflecting that heavy price,
highway banners in the Bekaa
Valley express open opposition
to Hezbollah candidates. “We
care for the resistance, but our
loyalty is to Baalbek-Hermel,”
one slogan read, suggesting
that the local community’s welfare matters more than Hezbollah’s military ventures abroad.
Some staunch Hezbollah
foot soldiers are among those
voicing dissent.
In April, Ali Mazloum, an
ex-fighter in Syria whose father died fighting Israel, published an open letter to Hezbollah
leader
Hassan
Nasrallah, berating him for not
tackling corruption within the
movement. His letter drew
support on social media.
In apparent response to
criticism, Hezbollah has recently shifted its message.
Giving an unusual number of
get-out-the-vote speeches, Mr.
Nasrallah has refrained from
talking about Syria much at
all, focusing instead on economic concerns in Lebanon.
Hezbollah’s spokesman, Mohammad Afif, said the group
was looking to get more involved in Lebanon’s economic
policy and the fight against
corruption. Hezbollah currently forms part of Lebanon’s
government, where it wields
influence far beyond its 13 of
critical defense against border
threats from Israel and the extremist group Islamic State.
Some see the group’s alignment with Iran and Syrian
President Bashar al-Assad as
problematic, however. “Shias
have a history of aligning with
the oppressed, not with dictatorships,” Mr. Jawhari said.
“We are a resistance [movement], and you don’t do resistance by going to war in
Syria,” said a former militant
whose brother died fighting
Israel in the 1990s. “I will
gladly go to fight Israel. But I
won’t send my sons to die in
Syria.”
parliament’s 128 seats.
The poverty rate in the Bekaa stands around 36%, according to the World Bank and
Lebanon’s Central Administration of Statistics. That doesn’t
include the nearly 500,000
Syrian refugees who have temporarily settled in the valley,
adding pressure on the area’s
resources.
Despite the grass-roots discontent, a tradition of low
voter turnout and strong Shiite adherence to Hezbollah
means the group isn’t in much
political danger.
In the Bekaa Valley, Hezbollah is still widely seen as a
Can Israel’s Clash With Iran Be Contained in Syria?
MIDDLE EAST
CROSSROADS
By Yaroslav Trofimov
DUBAI—The direct military
conflict between Israel and
Iran has already begun, with a
series of increasingly bold
(and usually unacknowledged)
Israeli strikes on Iranian bases
in Syria in recent weeks.
The question now is
whether this clash could be
contained
within Syria—
or whether violence could
spread to Israeli, Iranian
and maybe
Lebanese territory, unleashing a regional war.
So far, Israel has been
able to act with relative impunity. It enjoys the benefit
of a supportive administration in Washington, a Russia
that attempts to remain uninvolved—and an Iranian re-
B
ut that doesn’t mean
things won’t escalate
in the weeks to come.
There is only so much humiliation Tehran can sustain as
it absorbs Israeli strikes,
such as Sunday’s bombing
near Hama. And it’s only so
long that Russia—which has
the capacity to shoot down
Israeli planes over Syria—
can remain on the sidelines.
The timing of this confrontation—triggered by Israel’s
decision that it won’t allow
the establishment of Iranian
military bases and facilities
threatening it on Syrian soil—
is inconvenient for Tehran.
President Donald Trump
faces a May 12 deadline on
whether to renew the nuclear
deal. Amid Israeli campaigning aiming to prove Iran’s
noncompliance with the
agreement, Tehran is keen to
retain the good will of European states that are crucial
for Iran’s economy, and that
could prevent a re-imposition
of international sanctions.
“The Iranians are wise
enough to understand that
they are right now being provoked into doing something
stupid so that further drastic
measures against Iran would
be adopted also by the Europeans,” said Adnan Tabatabai, CEO of the Carpo think
tank in Germany who has advised the German government on Iranian affairs. “This
is why we may continue seeing some strategic patience
on the side of the Iranians.”
Iran’s options for responding militarily are risky regardless of what happens with the
nuclear deal. The most powerful weapons of Iran’s regional
influence are its proxies, most
notably Lebanon’s Hezbollah
Shiite militia, with its arsenal
of rockets and missiles. Israel,
however, has made it clear
that major attacks by these
proxies could prompt it to retaliate against Iran proper.
“Israel has changed. Before, Israel would hit at Iranian proxies. Now, the attitude is: if it’s an Iranian
proxy, it’s Iran, and Iran has
to pay,” said Meir Javendafar, Iran specialist at IDC
Herzliya, an Israeli academic
institution and think tank.
“If Hezbollah starts firing its
hundred thousand missiles
at Tel Aviv, you should expect Israel to attack Tehran.”
especially because of Putin’s
close relations with Israeli
leaders, but they don’t have
the luxury of a more trustworthy ally in Syria.”
W
JIM HOLLANDER/EPA/SHUTTERSTOCK
gime that is reluctant to retaliate militarily just as its
2015 nuclear deal with the
U.S. and other world powers
faces collapse.
Israeli leader Benjamin Netanyahu spoke about Iran on Monday.
While neither Iran nor the
Syrian regime currently has
the means to significantly deter Israeli airstrikes, Russia—
with its S-400 air-defense
system deployed to Syria—
does. Yet, despite years of
military cooperation with Iranian forces and Iranianbacked Shiite militias against
Syrian rebels, Russia so far
has refused to extend this
umbrella against Israeli raids.
While Iranian officials privately seethe about Moscow’s
posture, they have shied away
from public criticism so far.
“Iran is one of the loneliest countries in the world,
strategically,” said Karim
Sadjadpour, Iran expert at
the Carnegie Endowment for
international Peace. “They
have long distrusted Russia,
WORLD WATCH
FROM PAGE ONE
TAX
Continued from Page One
the S&P 500 are forecast to
rise about half as fast as aftertax earnings, at 12.1%, Thomson Reuters said.
“It’s clearly not just the
economy” driving corporate
profits, said Joseph LaVorgna,
chief economist for the Americas at Natixis, a corporate and
investment bank. “Change in
tax policy is part of it.”
Investors had anticipated
big tax savings and pushed
major U.S. stock indexes to record highs earlier this year. In
recent weeks, gains have been
more muted even as companies from Goldman Sachs
Group Inc. to Apple Inc. have
reported strong results.
S&P 500 revenues are expected to rise roughly on par
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with the fourth quarter’s 8.3%
rise from a year earlier, the
fastest clip since late 2011 and
the seventh straight quarter of
growth, Thomson Reuters data
show. The figures reflect reported results—as adjusted by
analysts—for about two-thirds
of companies in the index, and
analyst estimates for the rest.
Energy, technology and financial firms have led per-share
earnings growth with gains of
30% or more, followed by companies in the materials and industrial sectors, both above
25%. Real estate has lagged behind, at 2.7% per-share earnings
growth, as have consumer staples, at 13% growth.
Broader data suggest that
the tax overhaul has had at
best a modest impact on the
economy as a whole. Gross domestic product expanded at
2.3% in the first quarter, a
slower pace than at the end of
2017, as household spending
cooled. But business investment was strong and the tax
benefits are showing up in the
quarterly results of the biggest
U.S. corporations.
At CSX Corp., tax expenses
in the first quarter were
roughly flat, despite a 57% increase in pretax earnings, “illustrating the favorable impacts of tax reform,” the
railroad’s chief financial officer,
Frank Lonegro, said in a midApril conference call with analysts. The company expects
Pop in Profits
Lower tax rates are helping boost first-quarter earnings at S&P 500
firms to a seven-year high.
Year-over-year growth in per-share earnings *
40 %
30
25.3%
20
Pretax
earnings
growth
12.1%
10
0
2011
’12
’13
’14
’15
’16
’17
’18
*Latest data includes reported results and estimates
Source: Thomson Reuters
taxes to total about 25% of pretax income this year, down
from 38% last year.
In addition to a reduced income-tax rate at home, multinational companies will benefit because they generally can
now bring current and future
foreign profits back for U.S.
investment, dividends or share
buybacks without paying an
additional U.S. tax.
Many companies did face a
one-time tax on the foreign
profits they had accumulated
over the years. In most cases,
companies accounted for that
and other one-time tax effects
in the previous quarter, meaning that the current earnings
season is the first clear picture of how companies are faring on an ongoing basis.
hile Russia raised
the prospect of delivering the potent
S-300 air-defense system to
Syria after last month’s U.S.,
French and British strikes on
the Syrian regime’s suspected
chemical-weapons facilities,
Moscow has since said that
no decision on this move has
been made. (Russia suspended the delivery of S-300
to Syria in 2010, at Israel’s request—and it may not want
the system to be tested in
battle, and possibly proven ineffective, by Israel’s air force.)
Russia’s ambassador to Israel, Alexander Shein, highlighted Moscow’s balancing
act in an interview with Israel’s Ynet news publication
last week. While criticizing
Israeli strikes in Syria, Mr.
Shein also said Moscow is
“concerned” with Iran’s military presence there. “We do
understand the reasons Israel feels obligated to carry
out such actions in the first
place, and it would of course
be preferable if they were
avoided,” he said.
THE WALL STREET JOURNAL.
Now large companies are
deciding what to do with their
tax windfalls. Apple on Tuesday
boosted its dividend and said it
would repurchase $100 billion
of its shares from investors, the
latest in a flood of companies
returning cash to investors.
Apple’s tax costs for the first
three months of 2017 were $3.7
billion, including an assumption that the company would
pay U.S. taxes on some of its
foreign income. This year, those
costs declined by $1.3 billion
even as pretax income went up
by $1.5 billion. A new foreign
minimum tax likely won’t apply
to Apple until after its next fiscal year starts later in 2018.
Many companies are returning their tax savings to investors. The amount spent on
share buybacks in the first
quarter rose by more than 50%
over the fourth quarter of 2017,
and by two-thirds over the first
quarter of 2017, according to
S&P Dow Jones Indices. Companies have also set plans to
invest in expansion and new
technology, and some paid onetime bonuses to employees.
For 28 S&P 500 companies,
lower taxes were the difference between reporting earnings growth and an earnings
decline. Those included chemical maker Monsanto Co., asset
manager T. Rowe Price Group
Inc. and laboratory chain
Quest Diagnostics Inc.
A T. Rowe Price spokesman
said the firm also recorded an
increase to net revenue and
near-record asset inflows.
“The tax savings are also helping us accelerate investments
in our strategic priorities and
increase the return of capital
to our stockholders,” he said.
Monsanto noted that, while
its lower effective tax rate was
primarily a result of the tax
overhaul, it also reflected
other, unspecified tax effects.
Quest didn’t respond to a request to comment.
“More than ever, it matters
to look at more than just the
bottom line,” said Jack Ciesielski, an accounting analyst and
publisher of Analyst’s Accounting Observer. “The lower
tax rate could be masking deteriorating fundamentals.”
MALAYSIA
Opposition Leader
To Test ‘News’ Law
Opposition leader Mahathir
Mohamad dared authorities to
charge him in court under a
harsh new law against “fake
news” after police placed him
under investigation as election
campaigning heats up.
Dr. Mahathir, the country’s 92year-old former leader, is attempting to unseat his former protégé,
Prime Minister Najib Razak.
On Tuesday, Dr. Mahathir said
Mr. Najib’s supporters were systematically sabotaging the opposition’s campaign ahead of the
May 9 vote. Government officials
have denied the accusations.
—James Hookway
INDIA
Deadly Storm Hits
North, West Regions
A powerful dust and rainstorm
swept parts of northern and
western India, killing at least 72
people and injuring more than 100
others, officials said. The damage
was particularly severe in Agra,
the northern Indian city where the
Taj Mahal is located. Thirty-six
people died there as the wind
speed reached 80 miles an hour,
said Relief Commissioner Sanjay
Kumar of Uttar Pradesh state.
The monument wasn’t damaged.
—Associated Press
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | A9
IN DEPTH
BANK
Questions linger
Questions
linger
over
whether Morgan Stanley can
sustain its rebound. The firm’s
return on equity, a measure of
how profitably it invests shareholders’ money, has struggled
to crack the 10% level investors
typically demand. Its wealthmanagement clients are aging.
The long bull market that amplified fees has stalled.
Mr. Gorman has wrung the
easy gains by cutting costs and
cleaning up obvious problems,
says Charles Peabody, an independent stock-research analyst.
“The bar has been raised.”
Still, Mr. Gorman says the
tenor has changed in meetings
with investors and managers, in
which “the conversation has
gone from ‘can we fix this
thing?’ to ‘what’s next?’ ” Mr.
Gorman, who is likely to remain
in the job another three to five
years, says that “we are talking
more about the future, not just
atoning for the sins of the past.”
Mr. Gorman grew up in a
Melbourne, Australia, suburb
Total shareholder return since 2010
250%
200
JPMorgan
Chase
150
Citigroup
100
Bank of
America
Morgan
Stanley
Goldman
Sachs
50
0
–50
–100
2010 ’11
’12
’13
’14
’15
‘The path we were on was not sustainable.’
Morgan Stanley CEO James Gorman.
with nine siblings, the son of a
nurse and engineer. He avoids
the New York social scene—his
weekend home is in upstate New
York, not the Hamptons—and
oozes little of the charisma of
predecessor John Mack, a backslapping Southern bond trader.
Mr. Mack occasionally dined
in the firm’s cafeteria, mingling
with the troops, and was a fixture at San Pietro, an Italian
restaurant frequented by financiers. Mr. Gorman prefers the
quiet of his office, with its
wood paneling and Aboriginal
art, where every evening he tallies in longhand each division’s
daily revenues. He keeps the
loose-leaf sheets in a folder on
his desk next to a list of New
Year’s resolutions.
“James—and you’ll never
hear him say ‘call me Jimmy’;
it’s always ‘James’—does not
aspire to be a master of the
universe,” says David Rubenstein, founder of private-equity
giant Carlyle Group LP.
To pay for law school, Mr.
Gorman says, he cleaned dormitory bathrooms, tended bar
and worked Saturdays at a brokerage firm matching trade
tickets. He spent four years at
an Australian law firm before
enrolling in 1985 at Columbia
Business School.
He got job offers from investment banks but joined
McKinsey, where he eventually
landed in the financial-services
group advising companies including Merrill Lynch and
American Express Co. In 1999,
Merrill’s then-CEO, David Komanksy, recruited him as head
of marketing. Within two years,
he was running its retail arm.
Mr. Gorman helped transform
‘The conversation
has gone from “can
we fix this thing?” to
“what’s next?” ’
Merrill’s “thundering herd” of
brokers, who earned commissions selling stocks to middle
America, into a force focused
on managing assets and providing advice to wealthier clients.
He joined Morgan Stanley in
2006 with the same task. A disastrous 1997 merger with retail-brokerage Dean Witter had
sparked years of infighting and
a 2005 coup that restored Mr.
Mack to power. The two net-
works used separate trading
systems. More than 90% of
branches failed internal audits
the year before Mr. Gorman arrived, according to Morgan
Stanley executives.
Mr. Mack asked Mr. Gorman
whether the retail business was
worth keeping. “He told me it
could absolutely be fixed, that
it would take two years,” Mr.
Mack says, “and at that point
we’d have to decide whether to
sell it or double it.”
Mr. Gorman commuted daily
from Manhattan to Morgan
Stanley’s suburban Westchester
County campus.
He fired the 2,000 lowestperforming advisers and combined trading systems. When he
called branch managers to introduce himself, at least one hung
up on him, he says. The brokerage’s profit margins climbed to
17% in 2007 from 8%.
Morgan Stanley had largely
hung back as new types of exotic, risky trading swept Wall
Street in the early 2000s. It
was busy sorting through the
Dean Witter merger and, executives agreed, had lost a step to
rivals that were minting profits
on mortgage bonds and complex derivatives.
At the worst possible mo-
Breaking tradition
He slashed bonus pools, deferred more employee pay into
future years and began personally reviewing the 2,000 highest-paid employees. He nixed a
planned $50 million investment
in a hedge fund former Morgan
Stanley executive Zoe Cruz was
launching—breaking with Wall
Street tradition of funding star
traders when they strike out on
their own—according to people
familiar with the episode. Ms.
Cruz left the firm in the wake
of the mortgage-trade debacle.
The downturn also presented an opportunity. Mr. Gorman had negotiated a handshake deal in 2008 to buy retail
brokerage Paine Webber, a deal
that would have greatly increased Morgan Stanley’s scale,
but it fell apart as the crisis hit.
In 2009, Morgan Stanley
struck a deal for control of Citigroup Inc.’s Smith Barney and
its 11,000 advisers—Mr. Gorman’s wife, Penny, was once
one—with the right to buy the
rest eventually.
Dissent was swift, with investors concerned it would
bungle the integration. Some
LIBRARY OF CONGRESS; AP
Burkburnett, Texas, an oil boomtown, and members of the Texas Railroad Commission—which regulates the oil industry—in 1940.
Even political insiders are
confused by the name, Mr.
McAllen said. He recalls a Minnesota congressman who
showed up at a Democratic
fundraiser in August and
thanked him for running for the
seat, saying: “The railroads are
so important.”
Some Texans believe the
name has been kept for nefarious reasons, to lessen public involvement in the agency by
keeping voters clueless about its
true function. Since November,
just one person has addressed
the commission during the public-participation part of its regular open meetings, usually held
once or twice a month in Austin. Meetings cover matters
ranging from drilling disputes
to setting monthly allowable oil
production rates to assessing
penalties for safety violations.
“I think they like it to be obscure,” said Mark Miller, who
had unsuccessful runs for the
commission in 2014 and 2016
and made changing the name
one of his priorities. “They like
that people don’t actually know
what they’re voting for.”
The commission was created
in the 19th century to regulate
railroads—in part to keep owners from extorting money from
farmers and others to ship their
goods. Later, the commission
was also charged with regulating oil and gas pipelines. Over
the years, railroad oversight
was shifted to other agencies,
with the final involvement
transferred to the Texas Department of Transportation in 2005.
That leaves the Railroad
Commission’s roughly 750 employees to focus on oil, gas,
pipelines and mining—and
many Texans with train questions frustrated.
The Lone Star chapter of the
Sierra Club, an environmental
organization, fears people with
environmental issues, such as
land-use concerns with gas
wells, might not know where to
turn. “People wouldn’t think to
call the Railroad Commission,”
said Cyrus Reed, conservation
director for the club.
Longtime state Rep. Tom
Craddick, a former speaker of
the House and Ms. Craddick’s
father, is an outspoken critic of
efforts to change the name and
has helped defeat bills on the
subject.
Mr. Craddick represents part
of the Permian Basin, which
pumps a third of all crude oil
produced in the U.S. from its location in West Texas and southeast New Mexico, according to
the Permian Basin Petroleum
Association.
Mr. Craddick said changing
the name would mean renegotiating contracts with the federal
government that deal with environmental matters, although
some supporters of a name
change disagree. “It could be
very negative…a lot has
changed environmentally since
the 1930s and ’40s,” said Mr.
Craddick. “It’s booming out
’17
’18
Morgan Stanley bankers and
traders, scarred from the Dean
Witter merger, worried Mr.
Gorman was watering down the
firm’s Wall Street DNA, say current and former employees.
“I felt like the boy in ‘The
Polar Express,’ wondering why
nobody else could hear the
bell,” says Mr. Gorman, who
says he never doubted the
move. Last Christmas, playing
on the reference, Morgan Stanley’s head of investor relations
gave him a silver sleigh bell he
keeps on his desk.
“James made some tough
calls,” says Ruth Porat, then
Morgan Stanley’s chief financial
officer, now CFO at Google parent Alphabet Inc., “even when
they weren’t popular.”
Wealth management, thanks
to Smith Barney, accounts for
nearly half of Morgan Stanley’s
revenue while using a quarter
of its available capital. Client
assets have increased to $2.4
trillion from $1.6 trillion in
2010. Profit margins in 2017
were 26%, up from 6% just after the deal.
In part, that owes to the
soaring stock market, which has
increased client-portfolio values
and the fees Morgan Stanley
collects to manage them.
On 99% of days last year, its
wealth arm generated revenues
of $50 million to $80 million,
according to filings. Steven
Chubak, a Nomura Holdings
Inc. analyst, estimates the business, 44% of the firm’s revenue,
accounts for 55% of its market
value because investors put a
premium on its reliability.
Morgan Stanley also axed
some riskier businesses, cutting
25% of fixed-income traders in
2015 and reducing the capital
and borrowed money available
to the unit. The moves cast it
as more of a middleman for clients than a gambler—evening
out revenues, with fewer big
profits but fewer losses.
Mr. Gorman has been rewarded: His $27 million pay
package in 2017 was second
among Wall Street CEOs only
to that of JPMorgan Chase &
Co.’s James Dimon.
Mr. Gorman, who keeps a
makeshift office putting green,
has resumed golfing. He had
stopped after the crisis, wary of
being seen on the links while
Morgan Stanley struggled.
Last year at a town-hall
meeting, a banker asked what
kept him up at night. “Nothing,” he replied. Mr. Gorman,
who owns a Labrador and a
Maltese, added: “Maybe the
dogs, sometimes.”
ment, Morgan Stanley charged
in, just as credit and real-estate
prices were peaking. In 2007, it
lost $9.4 billion on one mortgage
trade, beginning a spiral that
brought it to the brink of bankruptcy a year later. Had regulators not intervened, it would
likely have followed Lehman
Brothers onto the scrap heap.
The firm emerged with a
20% shareholder in Mitsubishi
UFJ Financial Group Inc. and a
mandate from regulators to
clean itself up by raising capital,
lowering leverage and reining in
its problematic trading arm.
By early 2012, with concerns
about Morgan Stanley’s exposure to troubled European debt,
Moody’s Investors Service was
threatening a steep ratings
downgrade. Clients were leaving. Creditors were scrambling
to insure its debt against a default. Its shares touched $12,
near their 2008 low.
In his Switzerland interview,
Mr. Gorman told employees to
“read the newspaper.” The
firm’s precarious position required changes, including cuts
to bonuses and new risk limits
and if they didn’t like it, he
said, they were free to leave.
“I might choose different
words today,” he says. “But our
job as management is to be
honest and transparent about
what we’re doing.”
OIL
Continued from Page One
main task is to regulate oil and
gas operations. It has been one
of the most powerful offices in
Texas for 100 years, since a
mammoth oil boom put the
state on the economic map.
Mr. Sitton said it’s time to rebrand. Other state officials are
reluctant, saying the name is a
throwback to the original days
of the oil boom. Numerous bills
put forth in the Texas legislature to change the name to accurately reflect the agency’s duties have failed.
“It’s a historical name. It has
a lot of meaning across the
world,” said Lauren Spreen, director of public affairs for Commissioner Christi Craddick, who
is chairman of the commission
and doesn’t want the name
changed. She said Ms. Craddick,
a Republican running for reelection in November, talks to
Texans daily about what the
agency does.
Her Democratic opponent,
Roman McAllen, said the name
needs to change because it is
too obscure. “It’d be like calling
the Food and Drug Administration the National Football
League,” Mr. McAllen said. “This
is about basic transparency.
People come up to me all the
time and ask, ‘When are we going to get high-speed rail?’ ”
’16
THE WALL STREET JOURNAL.
Source: FactSet
MICHAEL BUCHER/THE WALL STREET JOURNAL
Continued from Page One
Morgan Stanley’s proprietary
trading desks and shrank its
bond-trading operations, the
source of repeat blunders. He
sold an oil-tanker fleet and a
half-finished casino, remnants
of the freewheeling culture that
once ruled Wall Street.
He doubled down on wealth
management, a steadier business. The purchase of Smith
Barney, completed in his early
CEO years, made Morgan Stanley the country’s largest retail
brokerage. Its 16,000 brokers in
600 offices from Tuscaloosa,
Ala., to Tacoma, Wash., now
outnumber its bankers and
traders and contribute more
revenue than either group.
They do so without taking the
kinds of risks that worry regulators and investors.
“It was a high-wire act. I
wasn’t naive,” says Mr. Gorman, 59. “But we didn’t have a
choice. The path we were on
was not sustainable.”
Postcrisis regulations and
market calm have made finance
a more mundane place, and
some other Wall Street heavyweights, too, are tilting away
from the precrisis years toward
safer, even boring, business
models. Goldman Sachs is pushing into consumer banking. Citigroup Inc. pared back its aim of
being a global retail bank.
Those caught on the wrong
side of Mr. Gorman’s changes
say his lower tolerance for risk
has made it harder to trade.
And his style—more aloof tactician than beloved leader—symbolizes to many what’s been
lost on Wall Street.
Jack DiMaio, a senior trader
and an old-school Wall Street
star, sparred repeatedly with Mr.
Gorman, warning that spartan
bonus pools would cause top
traders to quit, say current and
former executives. Mr. DiMaio
left in 2011 to start a hedge fund.
Mr. Taubman, the merger
banker, left in 2012 after being
passed over for a promotion and
founded a boutique investment
bank—one of the last provinces
of Wall Street’s star model.
After the Crisis
here—we’ve got 400 rigs running.”
As for Texans not being familiar with the commission, Mr.
Craddick said, “The vast majority of people that deal with the
Railroad Commission know
what it is.”
Former Texas state Rep.
Larry Phillips, now a state district judge, authored a failed bill
in 2015 to change the name to
the Texas Energy Commission.
The Republican told the story of
an elderly constituent upset
about a railroad-crossing closure and getting more upset
that the commission couldn’t
help. “If she’s confused, that’s
good enough for me,” he said.
A name change could trigger
costs to change signs and logos.
Estimates have run from
$100,000 to $500,000.
“It’s just not our priority to
spend that kind of money on a
name change,” said Ms. Spreen,
the public affairs director on the
commission.
For the third railroad commissioner, Wayne Christian,
who was elected for his six-year
term in 2016, the possibility of
further regulation and costs
puts him in the “leave it alone”
camp.
Mr. Sitton, tired of explaining
the name on a nearly daily basis, said money shouldn’t be the
issue. “We work for the people
of the state, and they should
know what we’re doing,” he
said. “I will raise the money.”
.
A9A | Friday, May 4, 2018
NY
* ***
THE WALL STREET JOURNAL.
GREATER NEW YORK
Mayor Backs Safe Hotel
Drug-Injection Sites
New York City Mayor Bill de
Blasio is backing the use of facilities where users can inject
drugs under medical supervision, saying they are necessary
to prevent overdose deaths and
encourage addiction treatment.
Overdose fatalities in New
York City have more than doubled since 2000, with a record-high 1,441 people dying
last year, according to a city
report released Thursday. Proponents say safe-injection fa-
1,441
Overdose deaths reported in
New York City last year
cilities will save lives and prevent the spread of disease,
while critics say the sites
would condone illegal activity
and enable addiction.
On Thursday, Mr. de Blasio
said he would support a oneyear pilot program in four neighborhoods: Gowanus in Brooklyn,
Longwood in the Bronx, and
Midtown West and Washington
Heights, both in Manhattan.
“After a rigorous review of
similar efforts across the
world, and after careful consideration of public health and
safety expert views, we believe
overdose prevention centers
will save lives and get more
New Yorkers into the treatment they need to beat this
deadly addiction,” he said.
City officials sent a letter to
the state Department of Health
on Thursday seeking authorization for the pilot program.
Approval also is needed from
the local district attorney’s office and from city council
members whose districts
would include the injection
sites, the mayor’s office said.
There aren’t currently any
safe-injection facilities in the
U.S., although they are being
considered in several cities,
according to the city’s report.
Kassandra Frederique, New
York state director at the Drug
Policy Alliance, an advocacy
group, said injection centers
save lives, reduce crime and
improve public health.
“New York can and must be
a leader now in saving lives by
opening safer consumption
spaces swiftly,” she said.
The annual cost for operating a supervised injection facility would depend on its services
and hours, ranging from as low
as $250,000 to as high as $3
million, the city’s report said.
They are victims of a
labor dispute in Toronto
that has disrupted
business at the Plaza
BY CRAIG KARMIN
AND KEIKO MORRIS
New York’s famed Plaza Hotel has been virtually closed
for the past week, turning
away guests who had booked
rooms for up to $1,000 a
night. And it all stems from a
protracted labor dispute hundreds of miles away.
The vast majority of guests
arriving at the Plaza have
been unable to check in since
the middle of last week, according to people familiar
with the matter, though the
hotel’s food hall has remained
open.
The Sofitel New York, another Midtown Manhattan hotel, was closed to all guests
for the past several days,
though a representative of the
hotel said on Thursday it is
accepting guests again.
The hotels got into trouble
after members of the New
York Hotel Trades Council
union who work at the Plaza
and Sofitel raised health and
safety concerns related to
staff training and other issues,
according to a person with
knowledge of the matter.
New York union members
MICHAEL NAGLE/BLOOMBERG NEWS
BY KATE KING
Turns Away Guests
The Plaza Hotel hasn’t been accepting guests since last week.
made those complaints as part
of a coordinated effort to help
resolve a separate union dispute in Canada, people familiar with the matter said. A Toronto hotel union has been in
tense contract negotiations
with a property managed by
Fairmont, the same company
that manages the Plaza.
By raising health and safety
issues at the New York hotels
and disrupting their business,
the unions hoped they could
apply additional pressure on
Fairmont to reach an agreement in Toronto, these people
said. Fairmont is owned by the
Paris-based hotel company Accor, which also owns the Sofitel brand.
The Toronto union’s executives declined to comment.
The New York Hotel Trades
Council represents about
32,000 workers across all five
boroughs and wields substantial political influence. The
union is led by Peter Ward,
who has a reputation as a
tough negotiator and has been
able to win favorable contracts for hotel workers.
A spokesman said Mr. Ward
declined to comment.
Employees at the Sofitel reception desk have told people
who requested a room this
week that the hotel was closed
due to “operational challenges.” A doorman at the
Plaza said the hotel hasn’t
been accepting guests since
the middle of last week due to
repairs.
The health and safety is-
sues have been addressed and
the Plaza is expected to return
to full operation soon, a person briefed on the matter
said.
But that would come too
late for some irate guests who
were turned away and went to
online message boards to
complain.
A reviewer from Zurich
wrote on TripAdvisor that he
flew 11 hours but was rebuffed
at the Plaza, which rebooked
him at another hotel. “I am
extremely upset not only that
we were turned away but the
handling for a 1000$ room per
night,” reviewer Carlos_Zurich
posted on the site.
Another on TripAdvisor
from Toronto wrote about getting bad news at the Sofitel.
“Arrived on 26th for 4
nights, only to find that the
hotel was NOT accepting any
guests,” Jay M wrote. “Not entirely clear why the hotel was
shut for ‘operational reasons,’
but I was assured of a full refund.”
The Plaza’s troubles also
come at an inopportune time
for its majority owner, the Indian conglomerate Sahara
Group, which has been trying
to sell the iconic property. Sahara hired JLL Hotels and
Hospitality Group last summer
to find a buyer and has been
in negotiations with a number
of parties, say people familiar
with the matter.
Tower Can
Dump
Trump
Name
Standoff and Explosion Leave One Dead, Nine Injured in Connecticut
WOIKE/HARTFORD COURANT/ASSOCIATED PRESS
BY CORINNE RAMEY
SCENE OF DESTRUCTION: Police went to a North Haven home after a woman who lived there reported she had escaped after being held hostage, officials said. Officers
negotiated for hours with a man at the property before a building there exploded Wednesday night. Nine officers were hurt. The remains of one person were recovered.
City Plans to Double Capacity for Ferry Service
BY PAUL BERGER
New York City will spend
$300 million to expand its
fleet of ferries and double passenger capacity, after ridership exceeded expectations in
NYC Ferry’s inaugural year.
James Patchett, the chief
executive of New York City
Economic Development Corp.,
which oversees the service,
said the city expects to order
more than 10 new boats, most
with a capacity of 350 passengers. That would bring the
fleet capacity to 6,000 people,
up from 3,000 today.
Before launching the ferry
service in May 2017, the city
estimated that annual rider-
ship for six routes would be
about 4.6 million people. But
over the past year, with just
four routes operating and only
two of those full-time, the service carried 3.7 million passengers. Now, the city has revised its ridership estimate
upward to nine million annual
passengers by 2023.
“They have come in numbers much greater than we
could have imagined,” Mayor
Bill de Blasio said Thursday,
standing on a pier in Bay
Ridge, Brooklyn, with a ferry
bobbing in the background.
During
peak
summer
months last year, some passengers to popular destinations, such as beaches on the
Rockaway Line, had to wait up
to an hour for space on a
ferry.
Last year, the city revised
its original order of 20 boats,
each capable of carrying 150
passengers, to add three ferries that can carry 350 passengers. Those boats will arrive
this summer, though Mr.
Patchett cautioned that on
peak summer days there still
will be lines for the busiest
routes.
At its current spending
rate, the ferry service will
have cost the city about $700
million by 2023.
Transit advocates have criticized the ferry service for being wasteful at a time when
the struggling subway and bus
systems, which are run by the
state-controlled Metropolitan
Transportation Authority, require more funding. The subway and buses carry about
eight million people a day
combined.
A ferry ride in the city
costs $2.75, the same price as
a subway or bus fare. But it
costs the city an additional
$6.60 a rider. The city spends
about $30 million a year subsidizing the service. That may
increase over time as ridership
rises, according to a spokesman for the mayor.
Kate Slevin, of the urban
planning group Regional Plan
Association, welcomed the
ferry program’s success. but
she added that she hopes
“similar attention can be given
to buses, bike share, bike lanes
and other forms of transportation that serve millions of New
Yorkers.”
Mr. de Blasio said the ferry
was a good alternative for
people stuck on crowded subway trains and congested
roads as well as for those who
live near the water. He said
the ferry offers residents more
options.
The city intends to add two
new routes in late summer—to
Soundview in the Bronx and to
the Lower East Side—with
more routes expected in the
coming years.
A New York State Supreme
Court judge ruled Thursday
that the residents of a Manhattan condominium can legally remove the Trump name
from the building’s facade.
Justice Eileen Bransten’s
ruling stems from a lawsuit
filed in January by the board
of 200 Riverside Blvd., which
is on Manhattan’s Upper West
Side. The suit asked the judge
to rule on whether a license
agreement requires the residents to keep the Trump
name or merely allows them
to use it.
A spokeswoman for the
Trump Organization said the
decision “was limited to a narrow technical issue of law, for
which there is no precedent in
New York.” She added that the
organization was confident an
appeals court would disagree
with the decision.
A lawyer for the condo
board declined to comment.
A license agreement with
Donald Trump shows that the
board paid $1 to use the
Trump name. “Trump Place”
was installed in large, brassfinish characters in two places
on the building in the late
1990s, according to the complaint. The building has 377
residential units and four commercial ones, it said.
In February, according to
the complaint, 63% of owners
who responded to a poll favored removing the Trump
sign. In March, the Trump Organization sent a letter to the
board that threatened legal action and “significant” damages
and legal fees if the name was
removed.
Removing the name still requires a vote by condo owners.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | A9B
NY
* *
GREATER NEW YORK
BY ZOLAN KANNO-YOUNGS
The motorist who struck
and killed two young children
in a Brooklyn crosswalk in
March was charged with manslaughter Thursday as prosecutors said she had ignored
doctors’ warnings not to drive.
Dorothy Bruns, of Staten Island, told police she suffered a
seizure before hitting the children and other pedestrians in
the Park Slope neighborhood
on March 5.
Ms. Bruns, who wore two
medical boots and used a
walker, cried toward the end
of her arraignment Thursday.
She
pleaded not guilty
through her attorney to second-degree
manslaughter,
criminally negligent homicide
and assault.
“This case was a heartbreaking case for all the people in Brooklyn,” District Attorney Eric Gonzalez said
afterward. “It was truly avoidable.”
The accident killed Joshua
Lew, 20 months old, and 4year-old Abigail Blumenstein,
the daughter of Tony Awardwinning actress Ruthie Ann
Blumenstein. Ms. Blumenstein,
who was pregnant, was injured but she and her unborn
child survived.
Ms. Bruns had suffered a
seizure in January and had
been instructed several times
not to drive because of the
possibility of her having another episode, according to
Assistant District Attorney
Craig Esswein.
“She was the last person
that should’ve been in the car
but she didn’t listen for whatever selfish reason,” he said.
David Jacobs, Ms. Bruns’s
lawyer, said she had a letter
written by a neurologist in
January “clearing her for her
regular activities.” He said she
needed to drive for her job.
New York Bourbon Takes Its Shot
The signature American spirit may have its roots in Kentucky, but the Empire State is making its mark
BY CHARLES PASSY
When Colin Spoelman
started producing his Brooklyn-made Kings County Distillery bourbon eight years
ago, he often got a reaction
akin to the one in that TV
commercial that mocked a
New York salsa. Bourbon, a
corn-based spirit that is often considered America’s signature sip, belonged to Kentucky, the purists argued.
Today, Mr. Spoelman has
claimed awards in several
prestigious
spirits competiFOOD &
tions for his
CULTURE
bourbon, and
sells about
80,000 bottles annually. His
distillery, which makes other
spirits, is undergoing a $1
million-plus expansion so it
can increase its output fivefold to meet demand.
In short, no one is laughing at the idea of a Brooklyn
bourbon anymore.
Just the opposite, says Mr.
Spoelman, who points with
pride to his range of releases,
including a “peated” bourbon
that has something of the
flavor of a smoky scotch.
The fervor for locally made
bourbon extends well beyond
Kings County Distillery to include several similar craftstyle producers throughout
the state, he notes.
“I think New York distilleries are leaders,” says Mr.
Spoelman, himself a Kentucky native. He runs Kings
County Distillery in partnership with David Haskell, a
magazine editor.
The examples of such distilleries are almost too numerous to cite. Black Dirt
Distillery, located in the Orange County hamlet of Pine
Island, has been making an
award-winning bourbon that
co-founder Jeremy Kidde
says is all about the “terroir,” using a term more
commonly employed in the
wine world. In this case, he
ANDY MCMILLAN FOR THE WALL STREET JOURNAL; ERIN LEFEVRE FOR THE WALL STREET JOURNAL (BELOW)
Driver Is
Charged
In Deadly
Accident
Colin Spoelman, above, works in Kings County Distillery in Brooklyn. Matt Fitzgerald, below, inspects bottles of the firm’s bourbon.
is referring to the rich soil in
which the local corn used for
the bourbon is grown. “It’s
true grain to glass,” he says
of the finished product.
Of course, New York
brands are relatively small
compared with the giants in
Kentucky. That state is home
to the major bourbon distilleries, from Jim Beam to
Maker’s Mark, and has its
own bourbon trail.
The spirit comes into par-
ticular focus in Kentucky
each year with the running
of the Kentucky Derby, set
for Saturday, when the horse
race traditionally is accompanied by the festive drinking of a mint julep (or two),
the popular bourbon-based
cocktail.
The Treasury Department’s Alcohol and Tax and
Trade Bureau, which oversees the labeling of distilled
spirits, doesn’t require that a
bourbon be produced in Kentucky to be called just that.
And as the craft-spirits
movement has taken off in
recent years—much like the
craft-beer movement a couple of decades ago—craft
distilleries throughout the
U.S. have made non-Kentucky bourbon a reality.
New York has been well
positioned to jump on the
craft trend—and, by extension, the craft-bourbon
one—because of recent
changes in state law that
have made it easier and less
expensive for smaller distilleries to operate and get
their product to market.
Earlier this year, New York
Sen. Chuck Schumer touted
Widow Jane, a spirits brand
based in Brooklyn that specializes in bourbon, at a conference at the University of
Kentucky. The borough “produces some of the best bourbon in the world,” he said.
There was just one problem: Some of Widow Jane’s
products are distilled elsewhere, including in Kentucky,
which prompted some jibes.
Widow Jane Vice President of Operations Michele
Clark explains that as the
now six-year-old company
gets its Red Hook operation
up to speed, it eventually
won’t need to look elsewhere
for sourcing. “We are absolutely shifting to producing
in New York,” she says.
GO INSIDE THE FUTURE OF THE HOME:
What is the latest in design and technology
that will impact our lives?
FEATURING:
HOW THE HOME HAS EVOLVED
THE NEW FAMILY HOME
Notable designer Jonathan Adler has seen the home
transform over his 25-year career. Listen to what he
thinks comes next.
Courtney and Robert Novogratz have transformed
full city blocks from the ground up, working with a
mix of properties ranging from hotels to traditional
ofice spaces from coast to coast. Hear how they
believe spaces have evolved and what comes next
for inside the home.
SLEEP LIKE A BABY
Dr. Harvey Karp is the author of “The Happiest Baby
on the Block,” a go-to-guide for parents looking to
soothe an irritated infant. Karp has parlayed his
experience into a new home gadget called SNOO, a
robotic bassinet that helps babies fall asleep. Find
out why he believes sleep is transformative for new
parents and babies and how technology plays a role.
NEXT-GEN CONCIERGES
The future “home helper” may be digital and ondemand. Hear how it is working now and how it may
evolve in the coming years. Featuring Marcela Sapone,
Co-Founder and CEO, Hello Alfred & Daniel Rausch,
Vice President of Smart Home, Amazon.
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.
A10 | Friday, May 4, 2018
THE WALL STREET JOURNAL.
NY
LIFE&ARTS
FILM REVIEW | By Joe Morgenstern
‘Tully’: Enter the Perfect Nanny
‘TULLY” TURNS OUT to
be a twofer. There’s the
movie you see, which is
whipsmart, intimate, affecting and fearlessly funny
about the mixed blessings of
motherhood. And there’s the
movie you replay in your
mind to sort out its several
mysteries. That one is
richer, deeper and strangely
beautiful.
The stars are Charlize
Theron as Marlo, a mother
who can barely cope with
two kids, then gives birth to
a third, and Mackenzie Davis
as Tully, a night nanny who
comes to help. (The unseen
stars are Jason Reitman, the
director, and Diablo Cody,
the writer, who serve and
deserve each other in the
best way; this is their third
collaboration, after “Juno”
and “Young Adult.”) Actually
Tully was sent to help. She
and her services are a gift
from Marlo’s brother Craig
(Mark Duplass), a rich guy
with an enviable lifestyle, a
lissome wife named Elyse
(Elaine Tan), a full-time
nanny named Shasta
(Stormy Ent), and a wellfounded concern that his sister may be coming undone.
Marlo is manifestly unlissome. She bulks large, and
not just because of the
weight Ms. Theron put on
for the role. Hugely pregnant at the outset, she’s a
formidable woman,
thwarted and acerb, who’s
too smart for most rooms
she finds herself in, a witty
woman who’s at her wit’s
end and getting little help
from her husband, Drew (a
FOCUS FEATURES (2)
Charlize Theron stars as an overweight mother who’s spread too thin until Mackenzie Davis’s night nanny comes to help
Mackenzie Davis as Tully and Charlize Theron as Marlo, above; Mark Duplass stars as Craig, below
touching performance by
Ron Livingston). She’s a
splendid creation played by
a scintillating artist at the
top of her game, a gravely
hilarious counterweight to
an eternity of blissful maternities in Hollywood films.
This film will have none
of it. Eric Steelberg’s camera
doesn’t even dote on Marlo’s
baby when she is born—no
closeups of an adorable face,
only coolly distanced shots
that see tiny Mia (who
doesn’t get named for quite
some time) as her exhausted
mother sees her, a crying
creature in need of constant
attention and a steady flow
of milk, which Marlo produces sans human kindness.
If all of that sounds hardhearted, it’s really not.
Marlo’s distress is understandable, and should come
with a thrill of recognition to many
women in the audience. In between
feedings and brief
sleepings, this beleaguered mom
must also meet the
needs of her gradeschool kids, which
range from reasonable on the part of
her daughter Sarah
(Lia Frankland), to
special in the case
of her son, Jonah (Asher
Miles Fallica). Jonah is
called “quirky” by people
want to be polite, and “an
out-of-the-box kid” by his
euphemizing school principal. But he has undiagnosed
behaviors that put him in a
box with uncertain dimensions and no name.
By now we know that Ms.
Theron brings a distinctive
physical beauty to the
screen, when she wants to.
When she chooses to do otherwise we get the foulmouthed prostitute and serial killer in “Monster,” the
smudge-faced iron miner in
“North Country,” the one-
armed warrior in “Mad Max:
Fury Road” or the slatternly
writer in “Young Adult,” a
cockeyed comic triumph that
remains severely unappreciated. The paradox in “Tully”
is that its heroine is beautiful, however heavy she’s become, but she doesn’t think
so. At a time when women
reject objectification, Marlo
objectifies her own body,
and objects to it vehemently.
“I feel,” she says, “like an
abandoned trash barge.”
That’s where the night
nanny comes in, and where
Ms. Davis makes a dazzling
entrance, followed by a
lovely performance that’s
the perfect complement to
Ms. Theron’s. Tully is exactly
what Marlo needs. She is
also, to Marlo’s dismay,
shockingly young and fearfully gorgeous, as well as
bright-spirited, cultivated
(casually quoting “And so to
bed” from Samuel Pepys, the
17th-century diarist), charmingly hippy-dippy (speaking
of Mia having been “Earthside for only three weeks”)
and wise beyond her 26
years. In other words, she is
everything Marlo is not,
though that distinction
proves startlingly incomplete. Yet the two women
connect, and their connection takes dramatic turns,
including exchanges that
were clearly, almost palpably, written by a woman: talk
of the conflict between being
a devoted mother and a sexually attractive wife; of the
endless promise of one’s 20s
that narrows down in the
course of one’s 30s, when
Marlo doesn’t even have a
dream that didn’t come true.
This short, bright comedy
with a dark core is immeasurably more enjoyable than
it sounds, or looks in the
trailers. Mr. Reitman has recaptured the delicate
directorial touch
he misplaced after “Young
Adult,” while Ms.
Cody’s multiedged sword of a
script sends its
characters down
the damnedest
surprising paths.
The film can be
faulted for its ultimately familiar
therapeutic formulations,
though Marlo may have had
plenty of shrinkery in her
wayward past. All of the
revelations may not parse
literally, but they’re so powerful metaphorically as to
leave a haunting afterglow.
The story the movie tells is
about nothing less than regeneration, the harrowing
process of pulling one’s
worn, dispirited parts into a
vibrant new whole. Tully the
night nanny alludes to it
when she describes rebuilding a boat, plank by plank.
“Tully” the movie swings
vertiginously between bleak
and buoyant.
The WSJ Daily Crossword | Edited by Mike Shenk
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PERFECT POSITION | By Marie Kelly
The answer to
this week’s contest
crossword is a
four-letter verb.
Across
1 “Time’s Arrow”
novelist
5 Slipped up
10 Bluffer’s
giveaway
14 Deficiency
15 Lickspittle
16 Thrusting
weapon
17 Shipper’s
business
20 Guitarist,
slangily
21 Musical rattles
22 Guadalajara gal
pal
25 Yogi Ferrell, e.g.
26 Acoustician’s
concern
33 Wrenches
34 Dele undoer
35 True, to Truffaut
36 One with a J.D.
37 Pitch
38 Afr. neighbor
39 Estate worker
41 Blush, e.g.
42 Camping treat
44 1959 play with
a title from a
Langston Hughes
poem
47 Monaco moniker
48 Movie palace
49 Not just sleeping
53 Entertain at
bedtime
57 Apply increased
pressure
60 It’s played with
a rope
61 Community
spirit
62 Its national
anthem is
“Amhrán na
bhFiann”
63 Many layers
64 County in New
York’s Southern
Tier
65 Political damage
control
s
Email your answer—in the subject line—to crosswordcontest@wsj.com
by 11:59 p.m. Eastern Time Sunday, May 6. A solver selected at random
will win a WSJ mug. Last week’s winner: Mike Healy, Jacksonville, FL.
Complete contest rules at WSJ.com/Puzzles. (No purchase necessary.
Void where prohibited. U.S. residents 18 and over only.)
Down
1 Letter before
Bravo
2 “The Poverty of
Philosophy”
author
3 Brain-freezing
brand
4 Stickup coverup
5 Like some
cuisine and
slurs
6 Balderdash
7 Fan’s cry
8 It has a red coat
9 “Great!”
10 Ben Gurion
Airport location
11 Sweeping tale
12 Headey who
plays Cersei
Lannister
13 Sustained
popularity
18 Trouble and
Aggravation
19 “Phooey!”
23 Goose in the
outfield
24 Shakespeare’s
merchant
26 Tanzania border
lake
27 Mix flick
28 Start for
muscular or
mural
PUZZLE
CONTEST
29 Hinge
30 Twistable
treats
31 Pacific
nation once
called Pleasant
Island
32 Mariner’s
challenge
37 Natatorium
event
40 Longspurs and
linnets
42 Alley rentals
43 Terrorizes
45 Sweep’s
target
46 Mother who
was sainted
49 Longing
50 River of
Memphis
51 “Son of ___!”
52 Not for
54 Grind gauge
55 Hatcher of
“Desperate
Housewives”
56 Wilson of
“Wonder”
58 In spite of,
informally
59 Don’t share
Previous Puzzle’s Solution
O
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C O I L
S U B L E
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A S Y W
M I S S I
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THE WALL STREET JOURNAL.
Friday, May 4, 2018 | A11
LIFE & ARTS
THEATER REVIEW | By Terry Teachout
TELEVISION REVIEW | By Dorothy Rabinowitz
‘SWEETBITTER’:
DELECTABLE DRAMA
THE CHARMS of this drama
about the world of a New
York restaurant run deep
and they make themselves
felt with startling speed. A
tale that begins as this one
does, with a 22-year-old
leaving her unexciting middle-American town to find a
bigger life in the fabled city,
can only suggest the beginning of a highly familiar adventure. That will not turn
out to be the case here. The
adventurer in question, Tess
(Ella Purnell), will confront a
toll taker on the bridge leading to Manhattan, a woman
who utters two words—
“seven dollars.” The traveler
is taken aback—she’s not a
girl with money to spare.
That seems like a lot to get
in, she tells the toll clerk.
“Seven dollars,” the toll
collector repeats evenly, with
no change of tone. We’ve
seen this woman before, and
heard this exact tone—she
knows her job and it’s not to
talk about the expensive tolls.
This briefest of encounters carries the first whiff of
the subtleties, the perfectly
observed detail, that distinguishes “Sweetbitter,” a sixpart series based on the
2016 novel by Stephanie
Danler. (Stuart Zicherman
was the executive producer
and director.)
The first person of consequence Tess meets in her
quest for a job is Howard (an
enthralling portrayal by Paul
Sparks), general manager of
a renowned Manhattan restaurant. A sophisticated, understated sort, he asks Tess
all sorts of unexpected inter-
vatingly with a focus on
kitchen scenes with staffers
screaming food orders, people with plates of hot food
racing past one another with
terrifying speed.
Tess is invariably in everyone’s way. She grasps too
late, one night, that she’s
supposed to be cleaning all
the salt shakers. Racing to
her post, she finds Simone,
patiently doing the job herself and wearing a look of supreme satisfaction. Simone is
nothing if not a highly complicated woman—one with a
certain blood-chilling quality
in Ms. FitzGerald’s vivid portrayal. The first thing Tess
hears about Simone when
she arrives at the restaurant
is a terse warning muttered
by a staff member: “She’s not
your friend.” It’s advice
whose soundness can seem
dubious one minute and then
again not—one of the appeals of the deftly sustained
mystery that surrounds this
character.
The series is set in 2006—
a year, its creators say they
chose because it was a time
before the arrival of smartphones when life could still
be experienced firsthand “in
tactile, messy ways.”
Whether thanks to the absence of those phones or
not, there’s no missing the
ebullience that courses
through this splendidly realized drama of ambition, of
workplace ties that bind—
that brings it roaring spectacularly to life.
view questions—the books
she reads, what interests
her—and he listens seriously
to the answers. Howard will
turn out to have a more
complicated life than expected, but he never loses
his status as revered authority figure to his staff—or his
capacity to steal almost every scene. Almost, because
“Sweetbitter” is remarkably
rich in distinctively drawn
characters.
Paul Sparks as Howard, above,
and Ella Purnell as Tess, top
The leader of the pack is
the elegant Simone (Caitlin
FitzGerald), a high-status
staff member known for her
encyclopedic knowledge of
wines and her lack of deference to Howard. She fears
no one. And she knows all
the do’s and don’ts of a career in restaurants—knowledge she’s willing to dispense to Tess, who soon
develops worshipful feelings
toward this queenly guide,
and for good reason. Tess’s
first days in training are
pure chaos, rendered capti-
New York
LYNN NOTTAGE frequently
writes dramas “about” a
topic or historical subject
that’s in or near the news:
blue-collar unemployment,
prostitution in Central Africa,
the Great Migration. Sober,
earnest stuff, in other words,
the kind of thing that tends
not to engage me—and yet
she’s one of my half-dozen favorite living playwrights,
among the very few whose
latest show I’ll go to see
knowing only that she wrote
it. Her career is a priceless
reminder that there are no
rules in theater save for the
Prime Directive: Don’t be boring. She hasn’t bored me yet.
“Mlima’s Tale,” Ms. Nottage’s new play, was inspired
by a magazine article about
how wild elephants are illegally hunted down by “contract poachers” and their
ivory tusks smuggled out of
Africa and sold for profit.
The results should by all
rights have been preachy in
the extreme. Instead,
“Mlima’s Tale” turns out to
be an enthralling piece of
theater that tells a fascinating story in a daringly original way (and does so with
lapidary concision—it runs
for just 75 minutes). Even if
you don’t much care about
elephants, you’ll still find it
riveting.
Part of what makes
“Mlima’s Tale” so fine is its
bold craftsmanship. Architecturally speaking, Ms. Nottage
pays tribute to Arthur
Schnitzler’s “La Ronde,” but
she has made Schnitzler’s
daisy-chain structure entirely
her own. Using just four actors on a near-bare stage—
one of whom plays the title
character, an elephant—she
transports us step by step
from a savannah in Kenya to
a cocktail party in Beijing.
Along the way we learn how
the tusks of Mlima (he’s the
elephant) are stripped from
his corpse and turned into
sculptures for the newly
monied Chinese leisure class.
As for the rest, I can’t explain it any better than by
quoting from the program
note by Oskar Eustis, the
Public Theater’s artistic director, who praises Ms. Nottage’s ability “to take social
issues and turn them into
compelling, character-driven
drama….her point of view is
clear without being didactic.” That’s exactly right: Instead of pounding the pulpit,
she portrays her characters
not as political-cartoon symbols of good and evil but as
men and women whose motives, as is almost always
true in real life, are mixed.
Mlima is played with arresting physicality by Sahr
Ngaujah (greatly aided, I’m
sure, by Chris Walker, who is
credited in the program with
“movement direction”). To
play a thoughtful elephant is
some trick, and Mr. Ngaujah
does so without benefit of
trunk or tusks: All he has to
work with are his body, Ms.
Nottage’s dialogue and the
sound effects of Darron L.
West, yet you buy unhesitat-
ingly into the illusion.
Would that I had the
space to adequately sing the
praises of Ito Aghayere, Jojo
Gonzalez and Kevin Mambo,
the other actors, or of Justin
Hicks, who wrote the gorgeously evocative incidental
music and performs it live
each night. All I can tell you
is that you won’t see a better cast anywhere on or off
Broadway. As for Jo Bonney,
the director, she’s beyond
praise: “Mlima’s Tale” is
staged so sensitively that it’s
impossible to disentangle the
script from the staging.
Hence I’m eager to see how
it looks in other hands, and I
expect that there will be
plenty of chances to do so.
This play is going to travel—
as well it should.
Mlima’s Tale
Martinson Hall, Public Theater,
425 Lafayette St. ($85-$150),
212-539-8500, extended
through June 3
Mr. Teachout is the Journal’s
drama critic. Write to him at
tteachout@wsj.com.
JOAN MARCUS
STARZ (2)
A Playwright and Her Prey
Sahr Ngaujah (center) as Mlima in Lynn Nottage’s new play
POST-WAR &
CONTEMPORARY ART
Wednesday, May 16 at 5pm
New York
INQUIRIES
+1 (212) 644 9020
megan.murphy@bonhams.com
PREVIEW
May 9-16
Sweetbitter
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d
Edmonton
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lt Lake
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60s
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Angeles
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LLittlee Rockk
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90s
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Jacksonville
l d
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Tampa
90s
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l igh
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Ch l tt
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i h
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Phil d lphi
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h ill
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bil
Mobile
50s
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Chicago
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Topeka
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Vegas
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Yorkk
ew Y
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an Francisco
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oux Falls
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Eugene
<0
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ary
Calgary
Miami
Ice
U.S. Forecasts
s...sunny; pc... partly cloudy; c...cloudy; sh...showers;
t...t’storms; r...rain; sf...snow flurries; sn...snow; i...ice
Today
Tomorrow
City
Hi Lo W Hi Lo W
Anchorage
48 40 r
48 39 c
Atlanta
85 66 s
83 64 pc
Austin
73 59 r
81 56 pc
Baltimore
90 63 pc 71 58 sh
Boise
82 55 pc 82 56 pc
Boston
76 57 c
72 56 s
Burlington
71 53 t
73 51 s
Charlotte
87 64 s
83 64 pc
Chicago
72 55 c
78 54 s
Cleveland
74 52 t
71 51 s
Dallas
71 57 sh 84 60 pc
Denver
68 46 s
72 44 pc
Detroit
76 53 sh 76 54 s
Honolulu
81 70 r
82 71 pc
Houston
83 66 c
81 62 c
Indianapolis
75 54 sh 75 55 s
Kansas City
76 53 s
82 55 s
Las Vegas
86 66 s
93 70 pc
Little Rock
77 60 c
79 55 c
Los Angeles
83 62 s
85 63 pc
Miami
84 73 pc 84 75 sh
Milwaukee
71 53 c
76 48 s
Minneapolis
79 55 pc 80 50 pc
Nashville
83 64 c
72 54 t
New Orleans
85 68 pc 84 67 c
New York City
89 63 pc 73 61 pc
Oklahoma City
74 52 pc 82 57 s
City
Omaha
Orlando
Philadelphia
Phoenix
Pittsburgh
Portland, Maine
Portland, Ore.
Sacramento
St. Louis
Salt Lake City
San Francisco
Santa Fe
Seattle
Sioux Falls
Wash., D.C.
Hi
80
88
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75
64
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75
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67
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90
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50 s
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64 pc 86 69 sh
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52 pc 80 49 c
59 c
81 60 s
54 s
81 58 pc
52 pc 65 52 c
40 s
76 45 s
49 c
68 53 pc
50 pc 82 50 pc
65 pc 73 61 sh
International
City
Amsterdam
Athens
Baghdad
Bangkok
Beijing
Berlin
Brussels
Buenos Aires
Dubai
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Edinburgh
Hi
64
79
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91
83
64
64
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97
64
62
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Lo W
44 s
64 t
71 s
79 t
63 s
41 s
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61 c
82 s
49 pc
50 pc
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Hi Lo W
68 48 s
81 65 t
93 73 t
92 79 t
80 55 pc
66 46 s
69 49 s
69 64 r
96 84 s
64 45 pc
63 47 pc
City
Frankfurt
Geneva
Havana
Hong Kong
Istanbul
Jakarta
Jerusalem
Johannesburg
London
Madrid
Manila
Melbourne
Mexico City
Milan
Moscow
Mumbai
Paris
Rio de Janeiro
Riyadh
Rome
San Juan
Seoul
Shanghai
Singapore
Sydney
Taipei City
Tokyo
Toronto
Vancouver
Warsaw
Zurich
Hi
70
66
87
83
75
91
87
72
65
69
95
61
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71
72
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70
82
67
80
90
77
84
71
71
58
74
67
Today
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Lo W Hi Lo W
49 s
73 50 s
51 pc 74 54 pc
66 pc 84 66 pc
77 c
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61 s
73 61 s
77 sh 92 76 sh
65 c
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44 s
72 45 s
49 pc 70 47 pc
47 s
72 52 pc
83 pc 95 82 pc
53 pc 67 52 pc
58 pc 73 55 pc
55 r
77 58 t
54 s
74 51 sh
82 pc 92 83 pc
48 s
74 52 s
72 s
85 72 pc
76 s 103 75 c
56 t
70 54 t
76 t
83 76 pc
52 s
71 55 s
67 pc 75 70 c
77 pc 89 80 t
54 pc 72 55 s
72 pc 90 74 pc
60 pc 75 63 s
46 c
74 50 s
46 c
63 50 pc
44 pc 69 45 pc
54 pc 72 53 s
ALEX KATZ (B. 1927)
Ada in Spain, 1981
oil on canvas
48 x 34 in. (121.9 x 86.4 cm)
$220,000 - 280,000
Art © Alex Katz/Licensed by VAGA, New York, NY
International Auctioneers and Appraisers – bonhams.com/contemporary
© 2018 Bonhams & Butterfields Auctioneers Corp. All rights reserved. Bond No. 57BSBGL0808
.
THE WALL STREET JOURNAL.
A12 | Friday, May 4, 2018
SPORTS
MLB
A SHIFT
FOR ICHIRO
Despite a wildly imperfect Cavaliers
team, LeBron James keeps writing
brilliant new chapters.
RICK YEATTS/GETTY IMAGES
ICHIRO SUZUKI, one of the most
freakishly talented and enigmatic
players in baseball history, ended
his season—and potentially his
major-league playing career—in
the most Ichiro of ways: shrouded
in an aura of mystery.
The Seattle Mariners—the team
that initially signed Suzuki out of
Japan to great fanfare in 2001 and
brought him back for a final bow
this season--abruptly released him
Thursday and announced he would
transition into a front office role. In
the position of “special assistant to
the chairman,” Suzuki will work
closely with the Mariners’ coaches,
performance staff and executives at
home and on the road, likely in uniform. Though the agreement only
covers the rest of 2018, general
manager Jerry Dipoto said that the
Mariners intend to keep the 44year-old Suzuki as “a member of
the Seattle organization long-term.”
But in unveiling the move, the
Mariners conspicuously didn’t use
the word “retirement.” John Boggs,
Suzuki’s agent, said that his client
intends to continue playing in 2019
and will continue working out and
taking batting practice this season.
He didn’t want to play for another
team or go through the traditional
waiver process, instead accepting to
move to his new job immediately.
“He transitioning into this role
in 2018, and 2019 has yet to
evolve,” Boggs said.
Suzuki, a future Hall-of-Famer
who has 3,089 major-league hits to
go with his 1,278 in Japan, rejoined
the Mariners in March after spending the last three seasons with the
Miami Marlins. At this point, it
seems unlikely that Suzuki will play
again for another team, but at least
a brief return to Seattle remains
within the realm of possibility. The
Mariners open 2019 with two
games in Tokyo against the Oakland
Athletics.
TONY DEJAK/ASSOCIATED PRESS
BY JARED DIAMOND
If you run into my
children in the next
few weeks, a warning:
they might be a nightmare. I mean, more of
a nightmare than they
usually are. They might be especially cranky and tired, demanding
cheese sticks and juice boxes. They
might wind up on the floor, kicking and howling, like an adult at
the Apple Genius Bar.
It’s not their fault. It’s mine.
I’ve been letting them stay up
late to watch LeBron.
My children are 5 and 3. They
are not sports fans. They are children. They would much prefer to
watch a crocodile wrestle a boa
constrictor. Or a volcano eruption.
Or “Octonauts.”
But for the past few weeks,
we’ve fallen into a routine whenever the Cleveland Cavaliers have
an evening playoff game. The children do their normal child-schtick
of wandering out of their bedrooms after bedtime, complaining
they can’t sleep. This is a lie.
They ask if they can sit on the
couch and watch a little TV.
I should say no, because they
really need to go to bed. But I say
yes, because LeBron James is playing basketball—and I want my
children to have watched LeBron
James play basketball, when he
was still in his prime.
I know it sounds corny, but I
think this is important. It’s pretty
obvious by now that James is one
of the greatest basketball players of
all time. When he finally wraps his
career, he may have a case alongside Michael Jordan as the greatest
NBA | By Jason Gay
Staying Up Late
to Watch
LeBron James
ever, and I want my children, when
they’re 35 or 62—or 147, living on
Mars with their own great-greatgreat-grandkids, and Elon Musk
and Tom Brady—to be able to say:
Yeah, I saw LeBron James play.
I think this is the kind of thing
I’m supposed to do as a parent.
Sure: I’m supposed to teach them
to brush their teeth, tie their
shoes, drive a stick shift and make
an Old-Fashioned the proper way,
with a muddler and real sugar and
not some garbage simple syrup.
But I also think it’s essential that
when something miraculous is
happening in sports, you make
sure that your kids see it.
Cubs fans know what I mean.
Cubs fans woke up newborns for
the final out of Game 7.
My tennis-nut Dad did this with
me, making sure I saw Jimmy Connors and Billie Jean King and Bjorn
Borg. This was easier, since tennis
was on during the day—or in Wimbledon’s case, the morning. I feel
like I watched every point of Borg’s
1980 Wimbledon epic with John
McEnroe. I’m not certain I did—I
may have taken a nap or wandered
outside to chase squirrels. But I
know what that match means to
tennis, because I saw some of it live.
That’s another thing. I know
some people may ask: Hey, Jason,
why can’t you just DVR LeBron
and show your kids the game in
the morning? Blecch. It isn’t the
same. It’s really not. I may as well
show them YouTube highlights of
Bob Cousy. Or a crocodile wrestling a boa constrictor. Live in the
moment is everything.
(I will show them YouTube highlights of Bob Cousy eventually, however. And Bill Russell, Jordan, Willie
Mays, Billie Jean and Eddy Merckx.
And the San Diego Chicken.)
My children are not watching
the entire Cavs game. Calm down.
They usually hang in for about 15
minutes. I think the longest anyone
has gone is until halftime. But I’m
pretty certain the 5-year-old knows
who LeBron is— big guy, fisher-
man’s beard, always has the ball,
usually doing something thrilling.
That’s one of the many great things
about LeBron. He always plays. He
barely sits. And on the court, he’s
at the center of everything.
That’s one of the greatest basketball players who has ever lived,
I tell my children. I really do! It’s so
pathetic and corny. I sound like I’m
in a commercial for life insurance.
I think the 5-year-old gets it. I
have no idea what the 3-year-old
thinks. I think the 3-year-old is
simply hoping to steal the remote
and switch over to “Octonauts.”
I’ll keep on letting them watch,
because LeBron seldom fails to deliver. Even this season, when he’s
playing with a roster the Cavaliers
found on eBay. Cleveland will have a
hard time marching to the Finals
this year. They barely squeaked past
Indiana in the first round. James
looks like someone who’s been asked
to carry a piano up a staircase. And
yet, he’s doing it, somehow.
This is what matters in sports. I
really believe that. We spend a lot
of time today arguing with each
other about controversies and contracts and inane topics like bat flips
or Bill Belichick’s cutoff sleeves, but
the whole reason we get addicted
to sports is the off chance of seeing
the type of greatness like LeBron
James is offering pretty much every other night. He’s 33 now, in his
15th season, and he’s still the best.
It’s amazing, close to magical, and I
think everyone should be watching.
Then you really should stay up
even later to watch Steph Curry.
But you’re going to be a wreck in
the morning.
CYCLING
BY JOSHUA ROBINSON
Jerusalem
NOTHING IN the rules of Italy’s
most famous bicycle race says it
must be contained entirely in Italy.
In its 109-year existence, for example, the Giro d’Italia has spilled
over the Italian border into neighboring Monaco, France, and landlocked San Marino.
In other words, the Italia part of
Giro d’Italia is merely a suggestion.
Over the past two decades, organizers have steadily pushed the envelope. In 2002, the Giro organized
the start of the race in the Netherlands. In 2012, it visited Denmark.
And in 2014, the race kicked off in
Northern Ireland. That’s when organizers began to wonder: if the race
doesn’t need to start in Italy, does
it need to start in Europe at all?
Which is why the 101st running
of the Giro d’Italia, the three-week
stage race, will begin here, in Israel, on Friday, in one of the most
audacious bits of race planning in
cycling history.
“When we had the opportunity
to take the Giro outside of Europe,
we took it,” Giro director Mauro
Vegni said. “We need, even more
than the Tour de France, to be
known internationally.”
Precisely how the first three
stages of the 21-stage race came to
be organized 1,400 miles from Rome
is a story that involves a suggestion
almost no one took seriously, a
Masters bike racer from Canada,
and one €10 million (about $12 million) payment.
Vegni received the first approach in January 2016, a casual
inquiry about whether taking a few
stages of the Giro beyond the cycling heartland of Europe was feasible. The person asking was Sylvan
Adams, a Canadian-Israeli real-estate developer who fell in love with
cycling in his 40s, raced competitively into his 50s and now backs
Israel’s first professional cycling
team, the Israel Cycling Academy.
Vegni was into the idea of exporting the Giro farther than ever
before. So much so that he was already talking another group about
an even bolder idea: taking the
race to Japan.
The Giro isn’t alone in its quest
for increasingly exotic routes and
start locations. The two other Grand
Tours races on the cycling calendar,
the Tour de France and the Vuelta a
Espana, do it too. Taking the start
abroad is viewed as an ideal opportunity to gain exposure and tap new
sponsors and broadcasters who haven’t been involved with the race
before. Last year’s Tour, for instance,
began in Düsseldorf, Germany.
No one, however, has been quite
as adventurous as the organizers
of the Giro d’Italia. The Giro has
started outside Italy on 12 previous occasions. But the 13th
wouldn’t be in Japan. The logistics
of a 20,000-mile round trip were
too complicated, officials said.
A training session on the
eve of the start of the
Giro d’Italia cycling race.
In the Israeli government, Adams found an enthusiastic partner.
Explaining that some 840 million
people tuned into the 2017 Giro at
some point during the three weeks
of the race, he pitched it as an
matched ad for the country’s tourism industry.
“I told the Minister of Tourism
to expect a BG and an AG effect:
before the Giro, and after the Giro,”
said Adams, who is also investing
in building a velodrome in Tel Aviv.
The deal was done with a handshake in Milan on the final day of
the 2017 edition of the race. With
the Giro now heading to Jerusalem,
Adams had new business cards
printed: “Self-appointed Ambassador-at-Large to the State of Israel.”
The race will begin with a 10-kilometer individual time-trial on
Friday from the edge of the old
city and then move onto a pair of
road stages: a mostly flat 167-kilometer run from the coastal city of
Haifa to Tel Aviv on Saturday, and
a potentially tricky 226-kilometer
haul from Be’er Sheva, south to the
scalding Negev Desert and finally
to the Red Sea resort of Eilat.
“We wanted to show off a good
deal of the geography of the country,” said Adams, who had originally
hoped for a medium-mountain stage
in the Judean hills outside Jerusalem before the idea was nixed.
Taking the race to say, the
Netherlands, of course, isn’t as politically fraught as bringing it here.
For race organizers, negotiating
the situation has proven delicate.
Last fall, they had to backpedal after referring to the start city as
West Jerusalem rather than simply
Jerusalem, an implicit acknowledgment of Palestinian claims to
the neighborhood of East Jerusalem. Under pressure from the Israeli government, the Giro went
back to calling it Jerusalem.
“Clearly, we were well aware it
could bring up controversy and criticism,” Vegni said of bringing the
race to Israel. “But the visibility outweighed any other considerations.”
The competitors, for their part,
have deliberately avoided any discussion of geopolitics. Chris Froome,
the four-time Tour de France champion, said the location of the race
hardly matters.
“I’m not someone to get involved
in politics,” he said at the Tour of
the Alps last month. “I’m a bike
rider.”
THOMAS COEX/AGENCE FRANCE-PRESSE/GETTY IMAGES
HOW ITALY’S MOST
FAMOUS BIKE RACE
WOUND UP IN ISRAEL
.
Friday, May 4, 2018 | A13
THE WALL STREET JOURNAL.
OPINION
Why Justice Is Defiant
The feud that
has simmered
for
months
between Congress and the
Justice
Department
POTOMAC
erupted this
WATCH
week into a
By Kimberley
cage match.
A. Strassel
That’s because
the House is
homing in on the goods.
Until this week, Deputy Attorney General Rod Rosenstein
and fellow institutionalists at
the department had fought
Congress’s demands for information with the tools of banal
bureaucracy—resist, delay, ignore, negotiate. But Mr.
Rosenstein took things to a
new level on Tuesday, accusing House Republicans of
“threats,” extortion and wanting to “rummage” through department
documents.
A
Wednesday New York Times
story then dropped a new slur,
claiming “Mr. Rosenstein and
top FBI officials have come to
suspect that some lawmakers
were using their oversight authority to gain intelligence
about [Special Counsel Bob
Mueller’s] investigation so
that it could be shared with
the White House.”
Mr. Rosenstein isn’t worried about rummaging. That’s
a diversion from the department’s opposite concern: that
it is being asked to comply
with very specific—potentially
very
revealing—demands.
Two House sources confirm
for me that the Justice Department was recently delivered first a classified House
Intelligence Committee letter
and then a subpoena (which
arrived Monday) demanding
documents related to a new
line of inquiry about the Federal Bureau of Investigation’s
Trump investigation. The
deadline for complying with
the subpoena was Thursday
afternoon, and the Justice Department flouted it. As the
White House is undoubtedly
monitoring any new congressional demands for information, it is likely that President
Trump’s tweet Wednesday
ripping the department for
not turning over documents
was in part a reference to this
latest demand.
Republicans also demand
the FBI drop any objections to
declassifying a section of the
recently issued House Intelligence Committee report that
deals with a briefing former
FBI Director James Comey
provided about former national security adviser Mike
Flynn. House Republicans say
Mr. Comey told them his own
agents did not believe Mr.
Flynn lied to them. On his
book tour, Mr. Comey has said
that isn’t true. Someone isn’t
being honest. Is the FBI more
interested in protecting the
reputations of two former directors (the other being Mr.
Mueller, who dragged Mr.
Flynn into court on lying
grounds) than in telling the
public the truth?
It’s hard to have any faith in
the necessity of the more than
300 redactions in the House
Intel report, most of which the
Republican committee members insist are bogus and
should be removed. On every
occasion that Justice or the
FBI has claimed material must
be withheld for the sake of national security or continuing
investigations, it has later
come out that the only thing at
stake were those institutions’
reputations. Think the Comey
memos, which showed the
former director had little basis for claiming obstruction.
Or Sen. Chuck Grassley’s
A House subpoena,
another missed
deadline. What is the
department hiding?
criminal referral of dossier
author Christopher Steele, the
FBI’s so-called reliable source,
whom we now know it had to
fire for talking to the press
and possibly lying.
The Justice Department is
laying all this at the feet of
the Office of the Director of
National Intelligence, which
technically oversees redactions. But ODNI consults with
the agency that “owns” the
material, and the FBI is
clearly doing the blocking.
Again, many pieces of the
House Intel report that are
being hidden happen to relate
to FBI conduct during the
2016 election.
The increasingly poisonous
interaction between Congress
and the Justice Department
also stems from a growing list
of questions Republicans have
about leading Justice Department officials’ roles in the
events Congress seeks to investigate. Mr. Rosenstein’s name
was on at least one of the applications for a warrant on
Carter Page to the Foreign Intelligence Surveillance Court.
Dana Boente’s name is on another, and he’s now serving as
the FBI’s general counsel.
We can’t know the precise
motivations behind the Justice
Department’s and FBI’s refusal
to make key information public. But whether it is out of
real concern over declassification or a desire to protect the
institutions from embarrassment, the current leadership
is about 20 steps behind this
narrative. Mr. Comey, Peter
Strzok, Lisa Page, Andrew McCabe—they have already shattered the FBI’s reputation
and public trust. There is
nothing to be gained from
pretending this is business as
usual, or attempting to stem
continued fallout by hiding
further details.
This week’s events—including more flat-out subpoena defiance—put a luminous spotlight on Speaker
Paul Ryan. The credibility of
the House’s oversight authority is at stake. Mr. Ryan’s
committee chairmen have
done remarkable work exposing FBI behavior, and they deserve backup. The quickest
way to get Justice and FBI to
comply with these legitimate
requests is for Mr. Ryan to
state strongly and publicly
that he has zero qualms
about proceeding down the
road of contempt or impeachment if House demands are
not met. This is the people’s
government, not the Justice
Department’s.
Write to kim@wsj.com.
It’s Hard to Find God on the Front Page
HOUSES OF R e l i g i o n religious events, according to Catholic Church. They let it go it feels like he’s the only reliWORSHIP
News Ser- Gallup polls, was 5.6 billion after 18 months, and now the gious news. And often genBy Julia Duin
vice, perhaps
A m e r i c a ’s
most important wire service for faith and
belief, is experiencing a meltdown. On April 20, its editor
in chief was dismissed without warning. Resignations
from two more veteran editorial staffers followed—a significant hit for a lean newsroom. A key fundraiser and a
business manager had left the
outlet earlier. Is covering the
God beat still a viable business model?
Faith certainly wasn’t translating into enough clicks for
RNS, which is why it hired a
lawyer with minimal newsroom experience as publisher
in November 2016. RNS long
had focused more on explaining the news than breaking it,
leading to declining page views
and a shrinking client list. The
new publisher responded by
ditching his editor in chief—
unnerving the newsroom in
the process.
It’s always been a struggle
to persuade news executives
that Americans are more interested in religion than, say,
sports. Associated Press religion writer George Cornell
addressed the issue a few
months before he died in
1994. He noted that religious
giving in 1992 totaled $56.7
billion—some 14 times the
gate receipts for America’s
three biggest sports. Cornell
also said that attendance at
in 1993. That was 55 times
the 103 million total attendance reported by the professional baseball, football and
basketball leagues. The gap
has narrowed in the past 25
years, but religious giving
still maintains a multibilliondollar lead.
Such involvement—no doubt
much of it in religiously active
flyover country—was not reflected in the average newsroom, even in the relatively
cash-flush 1990s. The typical
regional paper employed small
armies of sports reporters
while maybe employing a religion reporter. And Cornell’s
pessimistic piece came at only
the beginning of a decadeslong
decline in daily newspaper circulation. Never-ending layoffs,
firings and closings left religion among the most decimated of the specialty beats.
Whole regions of the western
U.S. and Canada have no staff
reporter covering religion.
Imagine if no one covered
sports in Oregon, Wyoming
and Arizona.
The Dallas Morning News
closed its six-page religion
section in 2007. The Vancouver Sun reconfigured the beat
of its award-winning religion
reporter into a “spirituality
and diversity” column, while
the Seattle Times’s religion
writer was reassigned to the
Microsoft beat. In 2014 the
Boston Globe started a specialty site, Crux, to cover the
Knights of Columbus sponsors
the site.
National papers like The
Wall Street Journal have held
up better. This paper employs
a religion reporter based in
Los Angeles, in addition to
its Vatican City correspondent in Rome. It also publishes
this religion column weekly.
A lack of reporters
means religious news
gets short shrift—and
lots of corrections.
eral-assignment correspondents, with little context or
understanding of the Catholic
Church, are tasked with covering him. There are also
countless important stories
about other believers—from
Muslims to Mormons—that
don’t get the coverage they
deserve.
Some new internet kids on
the block are producing religion stories in a gossipy entertainment format: “This Is
What It’s Like Being A Gay
Christian Rock Star” (BuzzFeed), “How the Kremlin may
have helped Trump win the
Catholic vote” (Vox), “Muslims
Are Internalizing Islamophobia, And Negative Media Coverage Is To Blame” (HuffPost).
This new generation of religion reporting is frequently
laced with opinion, simply because straight news is more
expensive to produce.
For RNS, there is a glimmer
of hope: a pending $4.9 million Lilly Endowment grant.
With the funds, RNS would
form a partnership in which
the Associated Press would
distribute its content. But will
media outlets buy it? For their
own good, let’s hope so. Millions of Americans care about
religion much more than
sports—or anything else, for
that matter—and wise editors
understand that passion.
Knowledgeable reporters are
needed who get the subtleties
of this difficult beat. That
lack of intellectual capital inevitably leads to embarrassing corrections.
It’s a shame so few outlets
seem to take religion seriously anymore. Done right,
the beat can be quite profitable. Anyone who wants to
understand the forces behind
much of today’s news needs
to understand faith. For instance, readers spent more
time perusing Graeme Wood’s
Atlantic article “What ISIS
Really Wants” than any other
story on the internet in 2015.
And this was fundamentally a
piece about theology.
Pope Francis has been a
news machine since his 2013
Ms. Duin is a blogger at
election. For some publications, GetReligion.org.
Marx’s Apologists Should Be Red in the Face
By Paul Kengor
M
ay 5 marks the bicentennial of Karl Marx,
who set the stage
with his philosophy for the
greatest ideological massacres
in history. Or did he?
He did, but deniers still remain. “Only a fool could hold
Marx responsible for the Gulag,” writes Francis Wheen in
“Karl Marx: A Life” (1999).
Stalin, Mao and Kim Il Sung,
Mr. Wheen insists, created
“bastard creeds,” “wrenched
out of context” from Marx’s
writings.
Marx has been accused of
ambiguity in his writings. That
critique is often justified, but
not always. In “The Communist
Manifesto,” he and Friedrich
Engels were quite clear that
“the theory of the Communists
may be summed up in the single sentence: abolition of private property.”
“You are horrified at our
intending to do away with private property,” they wrote.
“But in your existing society,
private property is already
done away with for ninetenths of the population.” And
this: “In one word, you reproach us with intending to
do away with your property.
Precisely so; that is just what
we intend.”
The bicentennial of
the man whose ideas
killed untold millions.
Marx and Engels acknowledged that their views stood
undeniably contrary to the
“social and political order of
things.” Communism seeks to
“abolish the present state of
things” and represents “the
most radical rupture in traditional relations.”
Toward that end, the manifesto offers a 10-point program,
including “abolition of property
in land,” “a heavy progressive
or graduated income tax,” “abolition of all right of inheritance,” “centralization of credit
in the hands of the state, by
means of a national bank with
state capital and an exclusive
monopoly,” “centralization of
the means of communication
and transport in the hands of
the state” and the “gradual abolition of all the distinction
between town and country by
a more equitable distribution
of the population over the
country.”
In a preface to their 10
points, Marx and Engels acknowledged their coercive nature: “Of course, in the beginning, this cannot be effected
except by means of despotic
inroads.” In the close of the
Manifesto, Marx said, “The
Communists . . . openly declare that their ends can be
attained only by the forcible
overthrow of all existing social conditions.”
They were right about that.
Human beings would not give
up fundamental liberties
without resistance. Seizing
property would require a terrible fight, including the use
of guns and gulags. Lenin,
Trotsky, Stalin and a long line
of revolutionaries and dictators candidly admitted that
force and violence would be
necessary.
We’re told the philosophy
was never the problem—that
Stalin was an aberration, as
were, presumably, Lenin,
Trotsky, Ceausescu, Mao, Pol
Pot, Ho Chi Minh, the Kims
and the Castros, not to mention the countless thousands
of liquidators in the NKVD,
the GRU, the KGB, the Red
Guard, the Stasi, the Securitate, the Khmer Rouge, and on
and on.
Couldn’t any of them read?
Yes, they could read. They
read Marx. The rest is history—ugly, deadly history.
Mr. Kengor is professor of
political science at Grove City
College. His books include “A
Pope and a President: John
Paul II, Ronald Reagan and
the Extraordinary Untold
Story of the 20th Century”
and “The Politically Incorrect
Guide to Communism.”
BOOKSHELF | By Nina MacLaughlin
How to Build
A Life
Making Things Right
By Ole Thorstensen
(Penguin, 234 pages, $16)
‘C
raftsmanship names an enduring, basic human
impulse,” the sociologist Richard Sennett has observed,
“the desire to do a job well for its own sake.” That
human impulse reverberates like a hammer bang throughout
Ole Thorstensen’s “Making Things Right,” a swift and understated examination of a life spent working with one’s hands.
Mr. Thorstensen, a savvy and matter-of-fact master
carpenter from Norway, tells the story of a loft renovation in
an Oslo home built in 1890, from the initial bid to the final
job-site tidy. Chapters start with hellos to the family on
Monday morning and end with the straightening and organizing before quitting time on Friday, bringing us along as the
work moves from architectural drawings through demolition,
framing, boarding, venting, window installation, fire-stopping,
tiling, plumbing, painting and finish work, from the fast and
brutal to the painstaking and meticulous.
“There is nothing mysterious about skilled manual labor,”
Mr. Thorstensen writes. And he does well to demystify the
trades. The work is not
magic—a matter of tools and
time, patience, practice and
desire. For its detailing of the
labor involved, the book will
as much be useful to someone
facing a renovation as it will
provoke nods of recognition
from those in the trades (the
splinters, the close calls, the
recollection, while passing by, of
each home you’ve worked in).
Mr. Thorstensen’s prose (in Seán
Kinsella’s translation from the
Norwegian) is unadorned,
utilitarian: The words do the work
they’re meant to do, without flourish. This
is harder than it seems, like the hours and effort
unseen that go into a seamless cope in crown molding or
leveling a floor. (“Easy reading is damn hard writing,” as
Nathaniel Hawthorne is thought to have said.) Mr. Thorstensen writes, for example, about doing a job for a pal
without a written contract: “We were close friends. That
friendship ended in a sad way.” It is left at that.
The book is, at its core, about relationships—between
carpenter and co-workers, architects, engineers; between
carpenter and client; and ultimately between worker and
work. Mr. Thorstensen writes beautifully of the simple
pleasure of carrying a load with someone: “To hold one end of
something heavy and be aware of another’s movements, feel
them transmitted through the object, is an experience all its
own . . . it is a good way to get to know one another.”
“Making Things Right” is akin to a book-length spinoff of
the carpenter’s section of Tracy Kidder’s “House” (1985),
which followed the building of a home from the perspectives
of architect, client and carpenter. Mr. Thorstensen laments
that architects and engineers don’t get their hands dirtier.
“Professional experience of the practical side, of being in touch
with tradesmen . . . is steadily declining among architects and
engineers,” he writes, echoing the gripes of every carpenter
I’ve encountered. “Theory is always flawless,” he deadpans.
A Norwegian carpenter’s step-by-step account
of a home renovation, alongside a paean
to craftsmanship and working with one’s hands.
There’s much discussion of the psychology of clients, about
the skills involved before the first swing of the hammer.
Carpenters and clients speak different languages—opportunities for misunderstanding are legion. His descriptions of the
work itself, however, the process of framing the ceiling or
cutting the opening for a new set of stairs, gives truth to
Richard Sennett’s argument that “craftwork establishes a
realm of skill and knowledge perhaps beyond human verbal
capacities to explain.” There’s pleasure in watching people
work, an aspirational sense of “This is possible for me.” That’s
why cooking and renovation shows are so popular. But there
were moments when I wondered if a layperson would be able
to understand what Mr. Thorstensen was doing—even with
the sketches that he includes to aid the explanation, I
struggled to visualize some of what he was trying to describe.
As anyone who’s spent an afternoon with a set of IKEA
instructions and baggies full of dowels and doodads knows,
sometimes words, and even pictures, aren’t enough.
Mr. Thorstensen shares the timeworn concern that people
these days are divorced from material reality and have little
interest in how their pants were sewn, chickens slaughtered,
shelves built. “I sometimes wonder if it has affected our idea
of time,” he writes of our culture of disposability. He explores
many of the same themes as Matthew Crawford did in “Shop
Class as Soulcraft” (2009), but spares us Mr. Crawford’s
macho posturing and tradework evangelism. There’s no sense
from Mr. Thorstensen that not knowing how to wire a light
switch or frame a wall makes you a lesser person. He makes a
case for the pleasure in starting with nothing and ending with
something, for a life spent accumulating experience, and he’s
attentive to details large and small, like the way music sounds
better on the radio once a room is insulated. “I would like to
be reborn a tradesman many times in a row with my experience intact,” he writes, wishing only for a new back each time.
How many of us can say this about our work?
One gets the sense that Mr. Thorstensen is good at his job,
that the satisfaction he derives from it is enough to drive him
through the cold days when his back aches and every
measurement seems off, when he frets deep into the night
about money and landing his next job. The loft proceeds—and
finishes ahead of schedule!—with few hitches. Inconveniences
are solved with ingenuity and ease. And while this makes one
want to hire (and be) a man or woman who works with as
much skill, experience and integrity as Mr. Thorstensen, a
reader might long for a little more conflict, a little more
strife, a little more of the inevitable job challenges that speak
to the larger struggles that all of us experience as we do our
best to build a life.
Ms. MacLaughlin is the author of “Hammer Head: The
Making of a Carpenter.”
Coming in BOOKS this weekend
Precision engineers and the modern world • The life of
Paul Simon • George Marshall goes to China • Inside
Graham Kerr’s kitchen • Catching the storm with Tim
Samaras • Sam Sacks on new fiction • & much more
.
THE WALL STREET JOURNAL.
A14 | Friday, May 4, 2018
OPINION
A
REVIEW & OUTLOOK
LETTERS TO THE EDITOR
The Nafta Ultimatum Strategy
Are Many Texas Urban Voters Slow Learners?
theory gaining ground in Washington competitive, market-distorting red tape. A wage
is that President Trump has begun to mandate is ferociously debated in U.S. politics.
grasp the economic importance of the Why does Mr. Lighthizer, a trade lawyer with
North American Free Trade
no notable businesses experiAgreement (Nafta) to his Trump’s trade rep thinks ence, think he can or should
Trump state constituents and
wages in another
Democrats will save his dictate
political future. You wouldn’t
country?
trade rewrite. Bad idea.
know it by watching U.S.
But the real damage here
Trade Representative Robert
would be to U.S. workers. The
Lighthizer negotiate the final
same goes for other new burstages of the Nafta rewrite with Mexico and dens such as requiring that 70% of steel and aluCanada.
minium used in manufacturing be sourced in
Legislatures in all three countries will have North America. Their jobs have been saved by
to approve the amended pact and that won’t be freer trade, which has allowed production and
easy this year with midterm elections in the U.S. labor efficiencies that have made the U.S. auto
and presidential and congressional elections in industry and more competitive.
Mexico in July. The earliest Mexico’s Senate will
All of this would also harm the availability
receive the text for a vote, requiring a two- of capital as investors flee the rising costs of
thirds majority, is during its lame duck session doing business on the continent. The paperin August, which doesn’t favor passage. Things work, administration and complexity of operacould get even more difficult once newly elected tions necessary to prove compliance with the
senators sit down after Sept. 1. Similar difficul- new labor rules would be further incentive to
ties are likely on Capitol Hill.
invest somewhere else.
This makes a prompt and mutually beneficial
Even if Mr. Lighthizer gets Mexico and Canresolution all the more crucial. Yet Mr. Lighthi- ada to yield, Republicans are threatening to rezer recently pushed the next ministerial round ject the revised pact if it includes Mr. Lighthiof talks to May 7 as he flew to negotiate with zer’s demand to strip arbitration panels for
China. His team last week also increased de- investor-state disputes. U.S. business relies on
mands that workers making cars and car parts these panels to protect property in Mexico and
in Mexico receive higher minimum wages.
Canada. More than 100 Members of Congress
The outlook is troubling largely because of have signed a letter to Mr. Lighthizer warning
this and other U.S. poison pills. Mr. Lighthizer him against this provision.
is dug in on his demand to kill Nafta’s multilatMr. Lighthizer doesn’t seem to care. He
eral arbitration panels that rule on state-to- wants to present Congress with an ultimatum
state disputes. Mexico and Canada oppose this to approve the renegotiated agreement or
as they do the Trump Administration’s five-year watch Mr. Trump let Nafta expire. On Tuesday
“sunset” provision, which means Nafta would Mr. Lighthizer said he expects to have a deal in
expire without affirmative steps by all three a week or two and predicted that Democrats
governments.
will help him pass it. These are apparently the
The Trump Administration is also obsessed AFL-CIO-backed Democrats who couldn’t dewith micromanaging the auto industry. Last liver a majority for trade agreements with Demweek it asked that 40% of North American cars ocrats in the White House.
and 45% of light trucks be built with labor that
More likely, they’ll call Mr. Lighthizer’s bluff,
is paid at least $16 an hour. Fifteen percentage let Nafta expire, and blame Mr. Trump and Repoints of this could come from high-skilled publicans for the economic damage. Maybe
workers but the rest would have to be paid to someone should inform Mr. Trump about the
blue-collar workers in manufacturing and as- gamble his trade negotiator is making with the
sembly. This is up from an earlier demand of U.S. economy, the Republican Congress, and, by
30% and 5% a few weeks ago.
the way, his impeachment that will come with
Mexico has good reason to reject this anti- a Democratic House.
P
Governments Steal Emergency Money
rogressives might get more Americans poses a $1.20 monthly fee on mobile devices,
to trust them with health care or educa- which is higher than most, the report notes. Yet
tion if Democratic state politicians could New York law allows about 40% to be thrown
do the government basics of
into the general fund.
State politicians
enforcing public safety and
Mr. O’Rielly has noted that
picking up the garbage. Witbased
on state tax records
spend 911 fees on
ness how states are diverting
New York collected more than
their own priorities.
fees that fund 911 emergency
$185 million in 2016. But only
services into other priorities.
$10 million went to the 911 call
Commissioner
Michael
centers known as public serO’Rielly of the Federal Communications Com- vice answering points.
mission has been sounding an alarm about 911
What happens to these dollars varies and can
fees collected by states and towns. These include “non-public safety or unspecified uses,”
charges are small, maybe a buck, on monthly the FCC says. One certainty: People think
phone bills. Yet some states are using the they’re paying for 911 services, not more income
money for purposes other than safety, accord- redistribution for the political class. A telecom
ing to an annual FCC report.
executive who allowed such pilfering would be
You can guess the usual suspects. New Jersey in jail.
diverted more than $108 million of $122 million
The FCC’s report exists mainly to shame
collected in 2016, or 89%. Rhode Island stuffed states, though New Jersey and New York politimore than $8 million of $14 million into the cians seem impervious to embarrassment. By
state’s general fund. Illinois apparently had a federal law these delinquents aren’t allowed to
burst of lapsed ambition and shuffled around receive some grants for, say, technology uponly $2.5 million. Right-leaning West Virginia dates, but that stick is unlikely to change behavhas also diverted funds.
ior. Perhaps the feds can do more on enforceThe FCC says New York “has not filed a re- ment. But a better outcome would be for an
sponse to this year’s data collection,” but the enterprising state legislator to make fixing the
Empire State has been a diverter every year problem a campaign issue and dare incumbents
since the first FCC report in 2009. The state im- to defend the practice.
M
The Stormy Daniels Damage
ost storms pass eventually. This for reasons that fall outside Mr. Trump’s presiweek Donald Trump tried to ensure dential campaign. And perhaps these admissions
that Stormy Daniels doesn’t rain will lessen Mr. Trump’s legal vulnerability.
down permanent distraction
What remains is the politiDoes Trump want
on his Presidency, though at
cal damage. Attempting to
the cost of further damage to
quiet a similar storm in 1998,
Americans to believe
his credibility.
President Bill Clinton said, “I
him in a genuine crisis? did not have sexual relations
Mr. Trump contradicted his
previous statements that he
with that woman, Miss Lewinhad no knowledge of paysky.” Many of Mr. Clinton’s
ments that his lawyer had made to Ms. Dan- political supporters were unmoved by the alleiels— the pornographic-movie actress whose gations against him. Similarly now, Mr.
real name is Stephanie Clifford—to quell stories Trump’s most ardent backers believe these
of an alleged affair.
charges aren’t relevant to his public initiatives
Speaking in his new role as Mr. Trump’s law- as President.
yer, former New York City Mayor Rudy Giuliani
That may be true regarding whether Mr.
disclosed that Mr. Trump made a series of pay- Trump had an affair more than a decade ago.
ments to reimburse lawyer Stephen Cohen, who Voters in 2016 knew Mr. Trump was no choir boy,
had paid Ms. Clifford $130,000 as part of a non- and the irony is that news of an affair would
disclosure agreement late in the 2016 presiden- probably have made no difference in his race
tial campaign.
against Hillary Clinton, who was Bill Clinton’s
In explanatory tweets Thursday, President wife and chief defender.
Trump said that “Mr. Cohen, an attorney, reBut Mr. Trump’s public deceptions are surely
ceived a monthly retainer, not from the cam- relevant to his job as President, and the atpaign and having nothing to do with the cam- tempted cover-up has done greater harm than
paign, from which he entered into, through any affair would have. Mr. Trump asked Amerireimbursement, a private contract between cans, not least his supporters, to believe his
two parties, known as a non-disclosure agree- claims about the payments. They were false and
ment, or NDA.”
conveniently so in putting the onus on Mr. CoThe apparent reason for these contortions is hen. Now, as more of the story has emerged, he
the possibility that the payments if made by Mr. wants everyone to believe a new story that he
Cohen would have exceeded federal campaign-fi- could have told the first time.
nance donation limits. We have long criticized the
Mr. Trump is compiling a record that inarcana of campaign-finance rules, but they are the creases the likelihood that few will believe him
law and carry real criminal penalties. That is why during a genuine crisis—say, a dispute over
presidential candidates hire squads of lawyers to speaking with special counsel Robert Mueller or
flyspeck donations during a campaign.
a nuclear showdown with Kim Jong Un. Mr.
Messrs. Trump and Giuliani are arguing that Trump should worry that Americans will stop
Mr. Trump’s payments to Ms. Clifford were made believing anything he says.
In response to Kevin Williamson’s
“Republicans Do Well in Texas, Except
for Dallas, Houston, Austin . . .” (Cross
Country, April 28): He is right. I am a
Texas Republican and believe the loss
of urban voters is because the party
has shifted from focusing on fiscal,
business and tax issues to emphasis
on socially conservative issues. A typical candidate might boast that “my
right-to-life position is more right-tolife than my opponent’s right-to-life
position.” And LGBT voters and their
friends may reasonably question a
party that spends time and energy
trying to dictate which bathroom 0.2%
of the population would use and
whose platform contains venomous
anti-LGBT planks. I fervently wish my
party—the party of freedom from
government interference in private
lives—would have a platform that
does not peek into bathrooms or bedrooms. Do that, and watch the Republican votes in urban areas rise.
LESLIE W. READ
Dallas
The Associated Press says Donald
Trump won the 2016 popular vote in
about 2,626 U.S. counties, while Hillary Clinton won 487, but Mrs. Clin-
ton’s wins included 88 of the 100 largest counties. Democrats rely heavily
on turnout by and votes from metroarea residents. Most of the largest
metro areas have demographic profiles
that determine their political destiny:
disproportionately African-American,
Hispanic and millennial (with the latter tilted to affluent, college-educated
whites). Houston’s population is 37%
Hispanic and 25% African-American. In
other battleground states, cities such
as Charlotte, Cleveland and Philadelphia (35%, 53% and 44% African-American, respectively) have large populations concentrated in relatively small
geographic footprints. Purple-state
election outcomes hinge on metro voters versus non-urban voters and tend
to be nail-biters.
U.S. urban communities with the
greatest income disparity soon may
have the power to determine most national election outcomes and are
primed to vote for Democrats who
promise to do away with income inequality. If Democrats flip Texas, Austinistas better be prepared to set
aside more money for income redistribution and less for Starbucks.
MATT JOHNSON
Charlotte, N.C.
Why Does Athletic Tail Wag Academic Dog?
It is both interesting and not surprising to hear Prof. Jay M. Smith’s
complaints about how college sports
invade his academic freedom, which
is really an illusion at UNC Chapel
Hill, when his class on the academic
fraud scandal was essentially canceled due to the athletic department’s
influence (“How Sports Ate Academic
Freedom,” op-ed, May 1).
What Mr. Smith doesn’t tell us is
why this influence exists. In 2017, his
university had revenue of
$2,124,202,667, yet the athletic department’s revenue was only
$90,500,869, or 4.26%. At the macro
level, this isn’t a very big tail wagging the dog, yet the dog is being
wagged.
At Chapel Hill, when women’s basketball revenue is only about 2.5% of
men’s basketball revenue, we know
there’s a Title IX issue hiding somewhere. When men’s basketball revenue per grant-in-aid (G-i-A) player is
$1,646,805.77, about four times the
revenue per G-i-A football player, we
know that college basketball is incredibly profitable, more than any
other college sport. When men’s basketball is black dominated, and when
black athletes there graduate at less
than half the rate of the general student body, we know racism is in the
mix. But there are only 13 G-i-A players on the men’s basketball team, so
they’re only exploiting a few black
guys in exchange for a fake education, or so the justification goes, as
they take millions of dollars off these
guys’ plates.
As distasteful as all of this is, it
doesn’t explain why the chancellor or
the provost would intercede on behalf
of the athletic department. Something else is going on underneath the
surface that has not yet been explained or measured.
RICHARD G. JOHNSON
Cleveland
Mr. Johnson was the first to win a
trial and a settlement against the
NCAA on behalf of a college athlete in
Oliver v. NCAA, 2009.
Resist the Progressive Hate-Speech Barrage
I can listen to liberal Annafi Wahed “A Warning to My Fellow Liberals” (op-ed, April 23) because she
makes sense. However, my tolerance
for the rant from the left has ended.
No longer will I sit quietly and be accused of hating Muslims, hating
women, hating gay people. No longer
will I be denigrated for beliefs that
liberals cannot tolerate. I will speak
out and accuse those calling me
names of hate speech. The Donald
Trump supporters I know have none
of the qualities the left wants to ascribe to them. Many on the left seem
to be purveyors of hate, vitriolic
speech, name calling, anger, rage, divisiveness and ugliness.
The media apparently sees no issue
in printing the left’s vicious, caustic
labels with no basis in fact, only doubling my distaste for these mannerless folks. People who supported President Trump aren’t an aberration. We
are Americans who want a voice in
our country. We are none of the labels
you attribute to us. Look in the mirror
Constitution Says President
Rules the Executive Branch
Kimberley Strassel is correct
(“How Trump Takes On Obstruction,”
Potomac Watch, April 27). Article II
of the Constitution vests all the executive power of the government in the
president and none in anyone else.
All talk about an “independent” Justice Department, FBI or special counsel is ignorant drivel.
The responsibility of executive-department officers is to assist the
president in exercising his constitutional duties as he—not they, a judge
or anyone else—thinks best. Any actions taken without his express or
implied authority are legal nullities,
and executive-branch employees
should resign or be fired if they decline to carry out his orders.
The Constitution provides only one
brake on the president: impeachment
and removal from office by Congress.
Special counsels, insubordination and
a fragmented executive branch lead
to governmental chaos, as Alexander
Hamilton noted in No. 70 of the Federalist Papers.
WILLIAM KELLY
Anderson, S.C.
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.
and see who hates whom. Step back
and take stock of your anger and rage
and get some counseling if need be.
CONNIE STEPHENS
Palm Desert, Calif.
Annafi Wahed worries that “unless we hatch a plan to stay in power
forever, we’re going to need bipartisan support for our policies.” Hasn’t
she noticed that creating a permanent legislative majority is the progressives’ plan? I want to know, if
the left succeeds in this pernicious
endeavor, what then? Where will she
stand when the free exchange of
ideas is held down by law and those
of us who don’t hold to the party
line have no representation? Will she
go to the gulag with us?
CAROL RADKINS
Citrus Heights, Calif.
Annafi Wahed makes valid points,
but if her fellow liberals have adopted
a rigid, dogmatic ideology, they are
no longer liberals. She mentions progressivism, but that is little more
than Marxism with a new name, and
it is a real threat to individual liberty
and our Constitution.
JIM PALMISANO
Cincinnati
App Must Be Bi-Functional
Concerning Elizabeth Bernstein’s
article “An App for Consenting to
Sex” (Life & Arts, May 1): Presumably
that app will be marketed in conjunction with a breathalyzer app.
THOMAS COFFEY
Wytheville, Va.
Pepper ...
And Salt
THE WALL STREET JOURNAL
“He wants to meet me in person,
but I’m not ready for
that level of intimacy.”
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | A15
OPINION
By Jay Winik
H
ow risky is the proposed
summit between Donald
Trump and Kim Jong
Un? As America’s greatest modern presidents
have found, summitry is an inherently high-stakes gamble. No matter
how well scripted, events can take
on a life of their own—or go dangerously awry. In negotiations, Mr.
Trump is known for making snap decisions that amount to seismic policy shifts. It’s unclear whether this
unpredictability would work in
Washington’s favor or Pyongyang’s.
Worse still, could a failed summit
chill relations, or even propel the
two sides to arms?
When Trump meets Kim
Jong Un, will he bungle
it like FDR and JFK?
Or triumph like Reagan?
If Mr. Trump looks to history, he
will find it instructive. High-profile
summits involve protocol and posturing, but they also invariably have
epic, if not unexpected, consequences. Consider the Yalta Conference, the meeting of Franklin D.
Roosevelt, Winston Churchill and Joseph Stalin in the waning days of
World War II. Churchill had a fever
of 102, while Roosevelt’s health had
failed so dramatically that onlookers
gave the president “six months to
live.”
The summit sprawled over eight
days, replete with morning meetings
among various ministers and military
chiefs, afternoon meetings of the big
three leaders, and private discussions over meals. Roosevelt tried to
improvise, but his legendary diplomatic skills failed him. At one point
he gave a nearly incoherent speech
about the Germany he had known
as a boy, which bore no resemblance to Hitler’s Third Reich. FDR
had not read his briefing books “as
much as he should have,” one State
Department adviser later recalled.
Instead the president had naively
believed his personality would win
over Stalin.
Yalta produced major agreements
for the eventual four-way occupation of Berlin, German reparations
for the Soviets, and the formation
of the United Nations. But as the
war’s victors divided the spoils,
Roosevelt capitulated to Stalin on
the pressing issue of Poland. Reluctant to court confrontation with Soviet troops on the ground, FDR acquiesced—over Churchill’s heated
objections—to Stalin’s demand for a
Soviet-aligned Polish government.
This effectively handed the Poles
from one master, the Germans, to
another, the Soviets.
Roosevelt also gave in to Stalin’s
demand that all the buffer nations in
Eastern Europe be “friendly” toward
Moscow, planting the seeds of the
Cold War. FDR’s reputation has since
been dogged by charges that he
“sold out” to the Soviets. In truth,
the U.S. had a weaker military hand
in Eastern Europe. FDR had no coherent strategy for overcoming that
disadvantage, and he refused to
jeopardize the gains he had made
elsewhere.
Things went little better in 1961,
when an untested and charismatic
new president, John F. Kennedy,
traveled to Vienna to meet with Nikita Khrushchev. An overconfident
Kennedy brazenly thought he could
charm the old Soviet. He couldn’t.
Instead, a well-rehearsed Khrushchev
berated Kennedy with accusations
CORBIS VIA GETTY IMAGES
Summitry Can Be Risky Business
Joseph Stalin and FDR during the Yalta Conference of 1945.
that the U.S. had been supporting
anti-Soviet forces in Europe and
Cuba. Kennedy was put on his heels.
Far from laying the groundwork for
better relations, Kennedy’s uncertain performance convinced Khrushchev he could get away with placing Soviet nuclear weapons in Cuba,
touching off the 1962 Cuban Missile
Crisis.
Kennedy, who took it personally,
admitted to a reporter after the
Khrushchev summit that it was the
“roughest thing in my life.” He was
so upset by his performance that
he pounded the inside of the car
door when he departed the Soviet
Embassy.
Overconfidence by one side was
also decisive at the 1986 meeting
between Ronald Reagan and
Mikhail Gorbachev in Reykjavik,
Iceland. For much of the decade,
the American and Soviet superpowers had escalated their arms race.
They came to Reykjavik for an informal prep meeting, hoping to lay
the groundwork for more extensive
talks in Washington.
Mr. Gorbachev shrewdly departed
from the script and sought to woo
Reagan with a full list of specific
proposals for arms control. Reagan
didn’t flinch; he and his team had
come prepared. The two leaders
went so far as to discuss eliminating
all nuclear weapons, but then Mr.
Gorbachev insisted on imposing limits on research into missile-defense
technology.
Reagan refused to budge on that
point. Instead he walked away from
what he thought was a bad deal. Yet
far from finger-pointing, he continued to have a warm relationship
with Mr. Gorbachev. Critics charged
the impromptu negotiations were
dangerous—contemplating the elimination of nuclear weapons without
adequate study. They also called the
talks a failure, since no agreements
were made. Reykjavik, however, set
the stage for a far-reaching U.S.-Soviet arms agreement in the future,
as well as the historic thawing of the
Cold War.
In all this history, there are some
clear lessons for Mr. Trump as he
sits down with North Korea’s leader.
First, always expect the unexpected.
Second, resist bad deals. Third, come
prepared. Trying to rely on your personality and charm to win over a
malleable opponent is a recipe for disaster; it failed not only Roosevelt in
Yalta, but also Kennedy in Vienna—
and Mr. Gorbachev in Reykjavik. By
contrast, having a broad strategy,
sticking to principles, and refusing to
waver from the bottom line secured
Eastern Europe for Stalin, emboldened Khrushchev, and helped Reagan
win the Cold War.
When assessing the hazards and
opportunities, it is also crucial to
consider Mr. Trump’s personality
and negotiating approach. Thus far
he has been sure-footed on North
Korea. But along with his many
strengths, he can be thin-skinned
and susceptible to flattery. He makes
feuds personal and sometimes promises one thing yet does another.
These instincts could be counterproductive with an adversary like Mr.
Kim, who is not a congressional
committee chairman but the dictatorial head of a bellicose nuclear state.
Mr. Trump must not lose sight of
this. Kennedy effectively did with
Khrushchev and paid the price. Reagan didn’t with Mr. Gorbachev and
reaped the rewards.
Having rolled the dice, the president will surely make history with
Mr. Kim. But whether the North Korean summit will be remembered as
a breakthrough or disaster is now up
to Mr. Trump.
Mr. Winik, author of “April 1865”
and “1944,” was the inaugural historian-in-residence at the Council on
Foreign Relations.
Modi Signals Weakness by Making Nice With China’s Xi
Anyone
watching
last week’s carefully
choreographed meeting between China’s
President Xi Jinping
and India’s Prime
Minister Narendra
EAST IS
Modi could be forEAST
given for forgetting
By Sadanand
that barely eight
Dhume
months earlier the
two nations’ troops
had a tense 72-day border standoff in
the Himalayas.
In the central Chinese city of Wuhan—where Mao Zedong once swam
across the Yangtze River along with
5,000 followers—Mr. Xi and his
guest struck a series of poses that
suggested bonhomie and goodwill
between the leaders of the world’s
two most populous countries.
Standing beneath a stone arch,
they admired vivid pink plum blossoms. They sipped tea together on a
boat. At a local museum, a classical
Chinese orchestra serenaded Messrs.
Modi and Xi with a 1980s Bollywood
tune. Between these excursions, the
two leaders held talks, flanked by
dark-suited officials.
For India, which seeks to be seen
as China’s peer, the visit hit the
right public notes. A Chinese Foreign
Ministry statement referred repeatedly to the two countries’ celebrated
“oriental civilizations.” A Chinese official pointed out that Mr. Xi had
only stepped out of Beijing twice to
host a foreign leader—both times
for Mr. Modi.
Ahead of the visit, an op-ed in
China’s state-owned Global Times
declared a “new chapter in Sino-Indian relations.” During last year’s
Himalayan standoff, the same newspaper launched a series of diatribes
against impertinent India.
If China and India were indeed in
the midst of a reset, to borrow the
overused term, the consequences
would ripple across the region and
beyond. The Trump administration
would need to reconsider casting India as one of two “bookends of stability” (along with the U.S.) of a
“free and open Indo-Pacific.” Smaller
nations, long used to Beijing and
New Delhi jostling for influence,
would have to adapt.
In reality, however, even the best
Chinese orchestra cannot serenade
away the deep-rooted problems between the two countries.
“The Wuhan summit is not an entirely new path. It’s more like getting back to an even keel,” says
Tanvi Madan, an expert on IndiaChina ties at the Brookings Institution in Washington. “India and China
have tried this before, and it hasn’t
changed things.”
Indian suspicion toward communist China dates back to 1962, when
the two countries fought a brief but
bitter border war, which China won.
Despite 20 rounds of talks, their
2,200-mile border remains disputed.
Over the decades China has helped
Pakistan develop nuclear weapons
and missile expertise.
The leaders’ photo-op was
almost enough to make you
forget about last year’s
Himalaya confrontation.
More recently, China has stalled
India’s entry into the Nuclear Suppliers Group, a consortium of nations that governs trade in civilian
nuclear technology. China has also
prevented the United Nations Security Council from blacklisting
Masood Azhar, the Pakistan-based
founder of the terrorist group Jaishe-Mohammed. The group was implicated in a 2001 attack on India’s
Parliament and has long been designated as a foreign terrorist organization by the U.N. and the U.S. State
Department.
Meanwhile China continues to
make inroads in South Asia, vying to
displace Indian influence in smaller
countries such as the Maldives, Sri
Lanka and Nepal. Last year’s Himalayan crisis, in which Indian troops
blocked Chinese efforts to build a
road on territory claimed by Indian
ally Bhutan, was widely viewed in
New Delhi as a Chinese bid to increase its influence in the tiny Himalayan kingdom.
On the whole, Mr. Modi has appeared more willing to play hardball
with China than his predecessors.
India was the only major country to
skip last year’s glittering Belt and
Road Forum in Beijing. The U.S. and
European nations later echoed some
of New Delhi’s concerns about Chinese infrastructure projects, including the contention that they often
place an unsustainable debt burden
on poor countries.
Chinese expansionism has pushed
India closer to the U.S. and Japan.
Last year India allowed the revival of
the so-called Quad, a loose grouping
of the region’s four leading democracies: the U.S., Japan, Australia and India. And New Delhi publicly shares
international concerns about maintaining open sea lanes in the South
China Sea despite Beijing’s expansive
territorial claims in the region.
Against this backdrop, the Wuhan
visit contained an undeniable element of Indian kowtowing. In order
not to offend Beijing, India appears
to have swallowed its concerns
about the Maldives’ tilting toward
China. India has also turned down
an Australian request to give the
Quad teeth by joining this year’s Malabar naval exercises with India, the
U.S. and Japan. In February, the Indian government issued a circular
advising government officials to skip
Tibetan commemorations marking
60 years of the Dalai Lama’s exile in
India.
In an interview in Washington
last month, Lobsang Sangay, president of the Dharamsala, the Indiabased Tibetan government in exile,
said the circular sent a mixed message to neighboring countries. “It
appears that the Chinese put a lot of
pressure and India gave a concession,” Mr. Sangay said.
Whether intentionally or not, Mr.
Modi’s visit signals weakness. Several analysts speculate that the
prime minister worries about a border skirmish with China jeopardizing his re-election prospects next
year.
Nonetheless, making nice with a
powerful neighbor at a sensitive
time is a lot easier than reorienting
an entire country. Nearly 60 years of
India-China rivalry cannot be reversed by even the prettiest photo
opportunities.
Is the Phillips Curve Dead? And Other Questions for the Fed
By Alan S. Blinder
M
arkets are aflutter over
whether the Federal Reserve
will bump up interest rates
twice or thrice more in 2018. But
members of the Federal Open Market
Committee have bigger questions to
worry about. They are struggling to
put numbers on what you might call
the fundamentals for conducting
monetary policy.
Consider these three rather basic
questions. First, given the current
state of the economy, should monetary
policy be stimulating the economy
or restraining it? Second, is current
monetary policy stimulative or restraining? Third, if the Fed alters its
policy, what should it expect to happen to inflation and unemployment? A
central bank that can’t answer basic
questions like these is in deep water.
Unfortunately, that’s exactly where the
Fed finds itself today.
Start with the first question. Most
economists determine whether the
economy needs stimulus by comparing current and projected unemployment rates with a measure called the
Nairu—the nonaccelerating inflation
rate of unemployment (sometimes
called the natural rate of unemployment). That number is supposed to
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mark the dividing line between unemployment so high that it pulls inflation down and unemployment so
low that is pushes inflation up.
Hence the awkward name.
Trouble is, nobody knows where
the Nairu is today. The FOMC is acting under the assumption that today’s 4.1% unemployment rate is below Nairu, which it currently pegs
at 4.5%. That could be right. But a
year ago the committee thought
Nairu was 4.7%, and three years ago
it pegged it at 5.1%. The estimate
kept falling because inflation stubbornly refused to rise despite low
unemployment.
Here’s my own view, but it’s no
more than an educated guess: The unemployment rate has settled at 4.1%
for six months now, and inflation is
creeping up very slightly. That suggests a Nairu in the 4% to 4.5% range,
just a pinch lower than what the Fed
now believes. But remember, the Fed
keeps lowering its estimate.
Now to the second question: With
the federal funds rate in the 1.5% to
1.75% range today, is monetary policy stimulating the economy or restraining it? To answer that question
in the past, economists have compared the real interest rate—the
funds rate minus inflation—to another key dividing line: the neutral
(or natural) real interest rate, which
Wall Street calls r* (pronounced “rstar”). Here’s the idea: When the real
federal funds rate is above r*, that
means money is “tight,” the Fed is
holding back demand and inflation
should fall. When the real federal
funds rate is below r*, money is
“loose,” the Fed is pushing demand
up, and inflation should rise.
But where is that dividing line today? That’s a complicated question,
because r* depends on many factors
beyond the Fed’s control. If any of
those other factors change, so will
r*. The most prominent example today is fiscal policy, which has recently changed quite a lot due to
Before adjusting interest
rates again this year, the
central bank should focus
on the fundamentals.
large tax cuts and a bipartisan
spending spree. These developments
have presumably pushed the neutral
interest rate above the Fed’s semiofficial estimate made last fall, which
was 0.4%.
Where are we today? The federal
funds rate is at 1.7%, while inflation
is at 2% and inching up. This means
the real federal funds rate—the difference between those two metrics—
is slightly negative and thus almost
certainly below the neutral rate,
though perhaps not by a huge
amount. The Fed’s current monetary
policy is therefore still slightly stimulative, and it is right to be nudging
rates up. But just how far is an open
question, as is the timing.
Question three is about what the
Fed should expect to happen to inflation as the unemployment rate declines. The time-tested answer is
that inflation should rise, in a relationship called the Phillips curve.
The problem is that this inverse relationship between lower unemployment and rising inflation is nowhere
to be found in recent data.
When I was the Fed’s vice chairman in the 1990s, we felt we had a
reasonable handle on the Phillips
curve: If unemployment rose by 1 percentage point for a year, that would
knock about half a percentage point
off the inflation rate, plus or minus.
That rule of thumb worked pretty
well back then. But not lately.
Since 2000, the correlation between unemployment and changes in
inflation is nearly zero. On average,
inflation has barely moved as unemployment rose and fell. This is puzzling, to say the least. The Fed needs
to know whether the Phillips curve
has died or has just taken an extended vacation.
If a genie suddenly appeared and
granted three wishes to Jay Powell,
the Fed’s new chairman, Mr. Powell
would probably ask to know the
Nairu, the neutral interest rate and
the shape of the Phillips curve. Alas,
no such genie has showed up. But
let’s hope for one. For compared to
those three gigantic uncertainties,
the choice between two or three
more rate hikes in 2018 is pretty inconsequential.
Mr. Blinder is a professor of economics and public affairs at Princeton University and a former vice
chairman of the Federal Reserve. His
most recent book is “Advice and Dissent” (Basic, 2018).
.
THE WALL STREET JOURNAL.
A16 | Friday, May 4, 2018
Full of personal stories and
beautiful photos, Magnolia Table
is an invitation to share a seat at
the table with Joanna Gaines and
her family.
“There is no better response to this
historical moment than cultivating
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political commentator, host of
“With Friends Like These” podcast
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The real story of what happened
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U.S. Indicts VW’s Former Chief
BY ADRIENNE ROBERTS
AND CHRISTINA ROGERS
Volkswagen AG’s former
chief executive faces U.S.
charges for his alleged role in
an emissions-cheating scandal
that has cost the German auto
giant billions of dollars in penalties and damaged its reputation, according to an indictment unsealed Thursday.
Martin Winterkorn, who
served as Volkswagen’s CEO
from 2007 to 2015, was
charged with conspiracy and
KKR Ends
Partnership
To Boost
Its Stock
Private-equity firm KKR &
Co. said Thursday it would
convert to a corporation from a
partnership, a significant shift
to its structure that signifies
how the new tax code is changing the contours of business in
the U.S.
By Miriam Gottfried,
Richard Rubin
and Chris Cumming
In the few months it has
been in place, the tax law has
catalyzed changes across business: Banks have reported big
earnings boosts. Some companies have handed out employee
bonuses tied to the extra cash
they say they will have, and
many have announced a flurry
of stock buybacks. Firms large
and small have contemplated
changing their structures.
For private-equity firms, a
conversion to a “C corporation” only became a realistic
option with Congress’s passage
late last year of the new tax
law, which lowered the highest
corporate rate to 21% from
35%. KKR’s chief financial officer, William Janetschek, said
Thursday that changing the
structure will raise the firm’s
effective tax rate from roughly
7% to about 22%, a more palatable change than if a conversion had been done under old
tax rules.
KKR hopes the change will
make its stock more attractive
to mutual funds and other institutional investors, which
mostly don’t invest in publicly
traded partnerships. This lack
of demand has depressed
KKR’s stock price, said Scott
Nuttall, KKR’s co-president and
co-chief operating officer.
“It became clear to us that
we’ve been fishing in a small
pond with a slow leak and
wondering why we weren’t
catching anything,” he said on
a conference call Thursday. The
theory is that making shares
accessible to a broader group
of investors, including potentially being included in indexes,
will lead to higher valuations.
For decades, businesses
have typically preferred to
avoid becoming C corporations,
which pay taxes on their profits and then face another layer
Please see KKR page B2
wire fraud in relation to a
criminal investigation into
the company’s efforts to
cheat on U.S. diesel-emissions
testing.
Mr. Winterkorn is one of
the highest-ranking foreign
executives to be charged by
U.S. prosecutors. He is believed to be residing in Germany. Neither he nor his attorney in Germany were
immediately available for
comment.
Volkswagen said it is cooperating with U.S. officials but
declined to comment on the
indictment.
The company has been
wrestling to contain the fallout from the scandal, which
affects millions of Volkswagen vehicles sold worldwide. Volkswagen’s board last
month ousted Chief Executive
Matthias Müller, the executive who replaced Mr. Winterkorn, after he lost favor with
the company’s core shareholders.
“The indictment unsealed
today alleges that Volks-
wagen’s scheme to cheat its legal requirements went all the
way to the top of the company,” U.S. Attorney General
Jeff Sessions said.
The indictment alleges
that Mr. Winterkorn was informed by employees of the
company’s intentions to defraud U.S. regulators by
cheating on diesel emissions
tests in May 2014 and July
2015, but agreed with other
senior VW executives to continue the efforts.
Prosecutors filed the in-
dictment in March, but
moved to make it public on
Thursday “because there is
no longer a belief that unsealing these documents will
compromise an ongoing investigation,” according to
court documents.
Although the U.S. has periodically charged foreign executives for their alleged roles in
financial crimes and other conspiracies, there have been few
prior indictments of such highranking foreign executives in
Please see VW page B2
Cboe’s ‘Fear Gauge’ Isn’t Measuring Up to the Tumult
The Cboe Volatility
Index, or VIX,
jumped this year
after a long stretch
of calm in markets.
30
20
10
0
2016
After climbing for
years, the number
of VIX futures
outstanding has
dwindled despite
the turmoil.*
’17
’18
’17
’18
600,000 contracts
400,000
200,000
0
2016
Cboe shares hit a
record in January
but are now
lagging behind
peers for the year.
CME
Performance, year to date
10%
Nasdaq
0
–10
Cboe
–20
*Through Wednesday
Jan.
Feb.
March
April
Sources: Cboe Global Markets (index, contracts); FactSet (performance)
May
THE WALL STREET JOURNAL.
The exchange operator’s shares have tumbled 15% this year amid concerns about the reliability of volatility trading. B11
STREETWISE | By James Mackintosh
Watch Out: Junk Bonds Getting Junkier
One thing
owners of
junk bonds
are usually
sure of is that
when the borrower defaults, they will get
a veto on cash going to
shareholders, to junior debtors or into new deals.
Not any more. Junk bonds
financing private-equity firm
KKR & Co.’s latest buyout
subvert the usual order by
allowing such payments to
go ahead even after a formal
default.
The $1.4 billion of bonds,
to repay temporary borrowing for the buyout of Unilever PLC’s margarine business, mark a new low in the
quality of covenants protecting lenders and are yet another sign of the wall of
money chasing the higher
yield on offer from junk
INSIDE
bonds.
Several recent bonds have
allowed what are known as
restricted payments even
when a company is in technical default—so that, for example, a planned takeover or
joint venture wouldn’t be derailed.
Flora Food Group, Unilever’s business, appears to
be the first explicitly to allow them after a formal
“event of default,” which
should put creditors at the
front of the line.
This matters when it
comes to assessing the risk
of the market as a whole.
Junk-bond enthusiasts tend
to highlight the yield spread
over Treasurys, which in the
U.S. is much higher now than
it was at the end of the last
bull market in 2007 and
about where it stood in 2014.
But the weakening of cov-
EARNINGS, B3
Junk Sale
U.S. junk-bond spreads over
Treasurys are near postcrisis
lows, but still above 2007 levels.
ICE BofAML U.S. High Yield
index, option-adjusted spread
20%
Recession
A who’s who of government,
business and international finance lost a total of more than
$600 million they had invested
in scandal-plagued Theranos Inc., according to previously sealed documents made
public in a lawsuit.
High on the list is Education
Secretary Betsy DeVos, whose
family invested $100 million in
the Silicon Valley blood-testing
company, the documents show.
Mrs. DeVos had previously disclosed that her family was
a Theranos investor in a government filing, but the size of
the investment wasn’t known.
“The investment was made
by many members of the DeVos
family,” not just Mrs. DeVos,
said Greg McNeilly, chief oper-
ating officer of Windquest
Group, Mrs. DeVos and her husband’s family holding company.
“To say they’re highly disappointed in Theranos as a company and an investment is an
understatement.”
President Donald Trump’s
education secretary is among a
number of prominent figures
who poured money into Theranos between 2013 and 2015
before a series of Wall Street
Journal articles revealed that
the company was encountering
problems with its technology
and misleading its investors.
These investments now are
essentially worthless. In an
April 10 email to shareholders
reviewed by the Journal, Theranos founder Elizabeth Holmes
raised the likelihood that the
company would be liquidated
BY DEEPA SEETHARAMAN
A small group of Facebook
Inc. employees have permission to access users’ profiles
without the users finding out.
Yet any time a Facebook
employee accesses a colleague’s personal profile, the
colleague is notified through
what is often referred to
within the company as a “Sauron alert”—a reference to the
all-seeing eye in the The Lord
of the Rings trilogy, people familiar with the matter say.
Similar protections don’t exist for the two billion-plus Facebook users who don’t work for
the company, the people said.
The dual standard for employees versus regular users is
a window on Facebook’s struggle over how much to disclose
to users about how their data
is handled—an issue Facebook
has recently tried to address
with a raft of changes.
A Facebook spokesman said
the company has had discussions about issuing these types
of alerts to all users. “In thinking about how we could do
something similar for everyone,
there are a number of important considerations that come
into play—for example, how we
can avoid tipping off bad actors
or hindering our work to prevent real world harm in cases
of abuse or other sensitive situations,” the spokesman added.
The system can be abused:
Earlier this week, Facebook
fired a security engineer who
had bragged to a woman he
met on a dating app about his
access to private user information, according to a person familiar with the matter.
“Employees who abuse these
controls will be fired,” Chief
Security Officer Alex Stamos
said of this week’s incident.
Facebook alerts users if
they have been hacked by outsiders but doesn’t inform them
about employees’ access. “Anyone can get alerts about unrecognized logins from other
users and check for suspicious
activity,” the spokesman said.
The ability to log into Facebook as a user without needing that person’s password is
limited to a small group of security personnel and other
employees. Their actions are
closely monitored, current and
former employees say.
The privilege entitles these
personnel to view information
Please see PRIVACY page B4
18
Twitter Finds
Password Bug
16
14
12
10
Site urges users to change
passwords because of glitch
that left them visible............ B5
8
6
4
2
0
2002
’10
Source: ICE via Federal
Reserve Bank of St. Louis
THE WALL STREET JOURNAL.
Theranos Hurt Big Names
BY JOHN CARREYROU
ACTIVISION BLIZZARD
IS ON TOP OF ITS GAME
enants means that losses are
likely to be bigger if there is
another wave of defaults,
which ought to justify lower
prices, and so higher spreads
over Treasurys.
Weaker covenants also
have taken away much of the
possible upside if the company performs surprisingly
well, in part by allowing
early repayment with fewer
penalties.
If shareholders get more
of the gains when things go
well and bondholders get
more of the pain when they
go badly, bondholders ought
to pay less to take on that
risk. Adjust for this and the
comparison with 2007 looks
less reassuring.
This subversion of the priority of creditors is a concerning point of principle,
but might be less important
Please see STREET page B2
Facebook
Has Dual
Standard
On Privacy
by August. Earlier that day, she
informed most of Theranos’s
remaining 125 employees they
would lose their jobs and paychecks on June 12, according to
people familiar with the matter.
Other investors facing big
losses include the heirs of Walmart Inc. founder Sam Walton,
members of Atlanta’s billionaire
Cox family, Mexican tycoon Carlos Slim, the scion of a Greek
shipping fortune and members
of a South African diamond dynasty, according to the documents, which Theranos provided to the lawsuit’s plaintiffs
as part of the discovery phase
of the case. Rarely have so
many high-profile figures been
known to have lost so much
money on a single investment.
Ms. Holmes claimed she had
Please see LOSSES page B2
Nike CEO
Apologizes
To Staff
BY SARA GERMANO
Nike Inc. Chief Executive
Mark Parker apologized to employees Thursday for allowing
a corporate culture that excluded some staff and failed to
take seriously complaints
about workplace issues, according to people familiar with
the matter.
The rare all-staff meeting at
the sneaker giant’s headquarters follows weeks of turmoil,
including the departures of
several senior executives and
internal complaints of inappropriate behavior.
Mr. Parker spoke in a
crowded theater at the Tiger
Woods Conference Center on
the Beaverton, Ore., campus.
The Nike veteran and CEO
since 2006 apologized to those
who felt excluded and felt like
they didn’t have anyone to
Please see NIKE page B6
.
B2 | Friday, May 4, 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.
General Motors...........B6
Goldman Sachs Group
...................................B11
Partner Fund
Management.............B2
H
Quest Diagnostics......A8
Relativity Media.........B6
Royal Caribbean Cruises
...................................B12
Hanesbrands.............B12
Hilton Worldwide
Holdings..................B12
B
Bank of America.......B11
Berkshire Hathaway...B2
Blackstone Group ....... B2
Bridge Investment
Group ........................ A2
Bumi Resources........B11
I-J
S-T
Iconix Brand Group...B10
Intel.............................A1
Jefferies Group.........B10
JPMorgan Chase.......B10
Samsung C&T..............B5
Samsung Electronics B12
Starbucks....................B6
Tapestry .................... B12
Target........................B12
Tencent Holdings......B12
Tesla.....................B3,B11
Theranos......................B1
Tiffany.......................B12
T. Rowe Price Group...A8
Trupanion..................B12
Twitter ........................ B5
K-L
Kellogg.........................B6
KKR ...................... B1,B10
Lenovo Group............B12
Lockheed Martin.........A1
C
M
Carlyle Group..............B2
Cboe Global Markets B11
CBS............................B12
Citigroup....................B10
CME Group................B11
Macy's.......................B12
McDonald's................B12
Microsoft.....................B4
Morgan Stanley..........A1
N-P
D-E
National Amusements
...................................B12
Natural Grocers by
Vitamin Cottage.......B6
Netflix..................B6,B12
Newton Investment
Management...........B10
New York Times.........B6
Nike......................B1,B12
Dell Technologies......B11
Elliott Management ... B5
Equifax ........................ B5
F-G
Facebook......................B1
Freddie Mac................A2
GE Capital...................B6
General Electric .......... B6
U-V
UBS Group.................B10
Unilever.......................B1
United Continental
Holdings....................B6
Viacom.......................B12
Virtu Financial..........B11
Volkswagen.................B1
W-X
Walmart......................B1
Walt Disney..............B12
WMC Mortgage .......... B6
Xiaomi..................B4,B12
INDEX TO PEOPLE
A
E-F
Agrawal, Parag............B5
Earnest, Josh..............B6
Fahy, Jamie...............B10
Forbes, Malcolm ........ M2
B
Bailey, Mike..............B11
Balwani, Ramesh
“Sunny”.....................B2
Bannister, Barry ....... B11
Bechtel, Riley..............B2
Benzimra, Frank........B11
Blefari, Gino................B2
Bogliolo, Alessandro.B12
Buffett, Warren..........B2
G-H
Gorman, James...........A1
Harris, Josh...............B10
Helú, Carlos Slim........B1
Holmes, Elizabeth ...... B1
Huynh, Tuan..............B11
J-K
Jae-yong, Lee..............B5
Janetschek, William...B1
Kraft, Robert...............B2
C
Carter, Shawn “Jay-Z”
...................................B10
Chae, Michael ............. B2
Champion, Thomas...B12
Colman, Robert...........B2
L-M
Lam, Felix..................B11
Levitt, Brian..............B12
Litvak, Jesse.............B10
Maharaj, Thushka.....B10
McCarthy, Kevin........B12
McNeilly, Greg ............ B1
Müller, Matthias.........B1
D
Day, Jon.....................B10
Demos, David............B10
Dracopoulos, Andreas.B2
KKR
Continued from the prior page
of taxation when those profits
are distributed to shareholders
as dividends; partnerships, on
the other hand, allow income
to pass through directly to
owners’ tax returns and get
taxed at individual rates. Under
the old tax law, C corporation
status mostly made sense for
companies that wanted access
to public capital markets.
Businesses like KKR were
the exception, a hybrid status
known as publicly traded partnerships. Now, the new tax law
is forcing companies to rethink
their structures, in decisions
that are very fact-specific. In
some cases, corporate status
brings some significant advantages.
But switching to a corporation also comes with risks,
namely that the decision is
hard to reverse without onerous tax consequences. Companies that switch are betting, in
effect, that the corporate tax
rate will stay low enough to
justify the change.
KKR’s peers have been
Up and Down
Share-price and index
performance since KKR’s initial
public offering in 2010
150%
S&P 500
100
50
KKR
0
’11 ’12 ’13 ’14 ’15 ’16 ’17
Source: WSJ Market Data Group
THE WALL STREET JOURNAL.
STREET
Continued from the prior page
for Flora bondholders than
the extreme weakness of
other protections they usually rely on.
Moody’s Investors Service
rated Flora’s bonds as Europe’s worst ever, scoring
4.99 out of five for weakness
of covenants. Only a handful
of U.S. bonds have scored
the full five.
Jason Suh, a former corporate-finance lawyer now at
analysis firm Covenant Review, says the other restrictions are so weak that the
question of formal default
might be academic.
“The covenants are so bad
on Flora that it would be
hard for the company to end
up in an event of default,” he
VW
Q-R
CHRISTOPHER GOODNEY/BLOOMBERG NEWS
A
Activision Blizzard......B3
ADT............................B10
Alibaba Group Holding
........................... B11,B12
Ally Financial..............B6
Amazon.com ............. B12
Apollo Global
Management.....B2,B10
Apple..................B11,B12
Ares Management......B2
Montagne, Amy..........B6
Moonves, Les............B12
Morfit, Mason.............B2
Munger, Charles..........B2
Murdoch, Rupert.........B2
Murphy, AJ................B11
Musk, Elon..................B3
N-O
Nuttall, Scott..............B1
Olson, Jim...................B6
P-R
Parker, Mark........B1,B12
Peltier, Ron.................B2
Pollack, Gary.............B11
Reznick, Mitch............B2
S-W
Siljamäki, Paavo.........B4
Sitton, Ryan................A1
Stamos, Alex .............. B1
Stokes, Jackie.............B4
Suh, Jason...................B2
Willens, Robert...........B2
Winterkorn, Martin....B1
Warren Buffett thinks the Berkshire Hathaway name can help expand his HomeServices of America.
Berkshire Highlights Brand
BY NICOLE FRIEDMAN
Warren Buffett’s Berkshire
Hathaway Inc. is a big name
on Wall Street. Increasingly, it
is a fixture on Main Street, too.
The Omaha, Neb., conglomerate was the nation’s secondlargest residential real-estate
brokerage last year, making
Berkshire Hathaway a presence
on neighborhood yard signs
from Los Angeles to New York.
It has franchised the Berkshire
Hathaway HomeServices name
to 1,330 offices and more than
45,000 agents.
Mr. Buffett, Berkshire’s
chairman and chief executive,
wants his franchise brokerage
business, HomeServices of
America, to get even bigger—
and the sterling Berkshire
Hathaway brand is an asset.
But further expansion could
also bring more visibility and
LOSSES
weighing converting, too, and
are likely to watch KKR closely
to see if a change in its stock
price outweighs any hit to the
bottom line because of a higher
tax rate.
KKR, which said the change
will be effective July 1, will become the second among its
peers to move forward with a
conversion. Ares Management
LP became a corporation on
March 1. Blackstone Group LP,
Apollo Global Management
LLC, Carlyle Group LP and
other peers have expressed
caution, citing the expected hit
to their profits.
“We’re monitoring carefully
all aspects of the issue. We’re
not in a hurry,” said Blackstone
Chief Financial Officer Michael
Chae on a recent earnings call.
“This is a race that does not
necessarily go to the swift, and
you have one shot at making a
thoughtful decision.”
Activist-investment firm
ValueAct Capital Management
LP, which owns roughly $1.1
billion of KKR stock, or about
6% of total shares outstanding,
has advocated for the structural shift.
“This conversion will help to
further expose a great business
to a broader universe of potential investors, and increase
long-term value for all shareholders,” said Mason Morfit,
chief investment officer of
ValueAct, in an emailed statement.
Shares of KKR rose 3% to
$22.14 Thursday as it announced the change along with
a lower quarterly profit than a
year earlier.
Robert Willens, an independent tax analyst in New York,
said he was surprised that KKR
made the switch and said he
was unsure whether the change
to corporate status would produce the increase in investors
that KKR is hoping for.
—Allison Prang
contributed to this article.
Continued from the prior page
invented groundbreaking technology that could perform the
full range of laboratory tests
from just a drop or two of
blood pricked from a finger. In
civil-fraud charges filed in
March against Ms. Holmes, the
Securities and Exchange Commission alleged that claim was
a lie and that Theranos used
commercial machines made by
other companies for the vast
majority of its blood tests.
Ms. Holmes settled the
charges without admitting or
denying wrongdoing by giving
back a big chunk of her Theranos stock, relinquishing voting
control of the company and
paying a $500,000 penalty. She
also agreed to be barred from
being an officer or director in
a public company for 10 years.
The SEC filed separate civilfraud charges against Theranos’s former president and
chief operating officer, Ramesh
“Sunny” Balwani, who jointly
ran the company with Ms.
Holmes for seven years before
he retired in May 2016. Mr. Balwani has denied the agency’s
allegations and is fighting them
in a San Jose, Calif., federal
court. His lawyer previously
said in a statement that Mr.
Balwani “accurately represented Theranos to investors to
the best of his ability.”
Theranos also remains under criminal investigation by
the U.S. attorney’s office in
San Francisco, according to
people with knowledge of
that probe. Theranos has
said it is cooperating with
the investigation.
The investors facing the biggest losses are the Walton family, who invested $150 million
in Theranos through two separate firms, the documents
show. The Journal had previ-
said.
Investors and lawyers say
that the sheer amount of
money chasing deals allows
high-profile issuers to get
away with terms that would
never have been accepted in
the past, although some less
well-known issuers have
been forced to tighten proposed covenants recently.
There also have been spillovers from the standardization of “covenant-lite” terms
in the leveraged loans used
by private equity.
Mitch Reznick, co-head of
credit at Hermes Investment
Management, says this is in
part because worries about
rising long-term bond yields
have increased demand for
floating-rate loans and for
bonds with short durations,
as junk bonds usually are.
“There’s convergence in
the structure and debt-pro-
tection language in the loan
market and high-yield [junk]
market,” he said. “It’s this
incremental degradation that
we’ve had through a period
of really low volatility.”
“If—when—we get a period of extreme volatility I
think that will reset things,
it will become more of a
buyer’s market than a
seller’s market.”
For now issuers are taking
full advantage of the demand, and not just by weakening covenants. Weaker
companies also are tapping
the market.
Moody’s calculates that almost 36% of U.S. junk-rated
companies are rated in B’s
lowest level or are already
rated C, the riskiest grouping, higher than at the peak
of the last recession.
However, default rates are
extremely low, despite a
expenses, according to the company’s annual report. Its revenue grew by 23% to $3.5 billion.
“We are certainly not the
biggest” Berkshire business,
said Ron Peltier, chief executive
of HomeServices. Some of Berkshire’s largest businesses reported tens of billions of dollars in 2017 revenue. “But we
are one that interacts and
touches lots of consumers…in
the most significant financial
transaction of their life.”
“Despite its recent acquisitions, HomeServices is on track
to do only about 3% of the
country’s home brokerage business in 2018,” Mr. Buffett wrote
in his 2017 letter to shareholders, which was released in February. “That leaves 97% to go.”
Berkshire comprises about
60 businesses across multiple
sectors, from insurance to railroads to batteries.
risk for the Berkshire brand.
Historically, its biggest consumer-facing
companies—
brands like Geico, Dairy Queen
and Fruit of the Loom—haven’t
used the parent company’s
name.
“When you get a disgruntled
customer, it might go straight
up to Warren,” said Gino Blefari, chief executive of Berkshire Hathaway HomeServices.
This weekend, the real-estate business will be among
dozens of Berkshire brands on
display at the company’s annual
meeting. Some 40,000 shareholders are expected to gather
in Omaha to hear Mr. Buffett
and Berkshire Vice Chairman
Charles Munger discuss the
business and answer questions.
Berkshire’s real-estate business earned $220 million last
year, down from $225 million
the year before due to higher
In the Red
High-profile investors who lost the most money on Theranos
Amounts invested
Walton family
Heirs of Wal-Mart Inc. founder
$150 million
Rupert Murdoch
Exec. chairman, 21st Century Fox
and News Corp
121*
Betsy DeVos
Education Secretary
100
Cox family
Media, telecommunications,
automotive
100
Carlos Slim
Media investor
30
Andreas Dracopoulos
Greek shipping magnate
25
Oppenheimer family
Ex-De Beers owners
20
Riley Bechtel
Ex-chairman of Bechtel Corp.
6
Daniel L. Mosley
Estate attorney at Cravath,
Swaine & Moore
6
Robert Kraft
N.E. Patriots owner
*Mr. Murdoch invested
$125 million in Theranos.
He sold his shares back to
the company in early 2017
for $1. Theranos later paid
him an additional $4
million under a clause
triggered by a legal
settlement with another
investor.
1
Source: Theranos Inc. document made public in litigation
THE WALL STREET JOURNAL.
ously reported that the Waltons
were investors but not the
amount they invested.
Other Theranos investors
facing big losses include Mr.
Slim, Greek shipping heir Andreas Dracopoulos and members of South Africa’s Oppenheimer
family,
which
controlled the diamond company De Beers until it was sold
to Anglo American PLC in
2011. Mr. Slim invested $30
million, while Mr. Dracopoulos
and the Oppenheimers invested $25 million and $20
million, respectively, according
to the documents.
Among U.S. investors, the
Coxes invested $100 million, the
documents show. Riley Bechtel,
former chairman of construction giant Bechtel Corp., invested $6.2 million. New England Patriots owner Robert
Kraft invested about $1 million.
Representatives for Mr. Slim,
the Oppenheimers, the Waltons,
the Coxes, Mr. Bechtel and Mr.
Kraft didn’t immediately respond to requests for comment.
Mr. Dracopoulos declined to
comment.
The documents revealing the
identities of Theranos investors
and the size of their shareholdings were unsealed Thursday in
a
lawsuit
brought
against Theranos by former
Robertson Stephens & Co. cofounder Robert Colman in a San
Francisco federal court. In the
lawsuit, Mr. Colman alleges that
the company made false and
misleading claims about its operations and technology while
soliciting money from investors.
Theranos has denied the
suit’s allegations and is fighting them.
pickup in the first quarter as
retailers struggled with the
shift to online shopping.
Weaker covenants could allow companies to survive
longer before defaulting, too,
helping keep the default rate
lower for longer than usual.
weaker covenants, and if the
companies ultimately survive
that is the best outcome for
creditors.
But if there is a proper recession and defaults pick up,
creditors could lose even
more than in the past as
companies with weaker covenants burn more cash before they die, leaving less for
creditors picking over the
bones.
Since Flora’s bond was
sold it has dropped in price,
and now yields 8% in dollars
and 6% in euros.
Ultimately investors face a
problem, because so many
asset classes look expensive
and overleveraged.
But don’t be fooled into
thinking junk bonds are reasonable just because they offer a higher premium over
safe government debt than
in 2007.
$1.4B
Amount in junk bonds funding
KKR’s latest buyout
Such a low default rate
could be good or bad for
bondholders, depending on
where the companies eventually end up. A shallow and
short economic downturn
might lead to fewer defaults
than in the past, thanks to
Continued from the prior page
recent years.
In 2011, several former executives of Siemens AG, including a former chief financial officer of Siemens
Argentina, were charged for
allegedly bribing Argentine
government officials.
The Justice Department in
2015 charged 14 individuals,
including nine FIFA officials,
on corruption charges, some of
whom were foreign nationals.
Mr. Winterkorn faces up to
five years in prison and a
$250,000 fine for the conspiracy count and up to 20 years
jail time and a $25,000 fine for
each of the three counts of
wire fraud, according to the
government.
The Justice Department indictment alleges that as early as
May 2014, Mr. Winterkorn was
briefed about a study conducted
by the International Council on
Clean Transportation, a nongovernmental
organization,
that showed some VW vehicles
emitted higher NOx emissions
during normal driving than registered during treadmill tests.
Federal prosecutors also allege that in a July 2015 meeting, the former CEO “approved
the continued concealment of
the cheating software from
U.S. regulators.”
Mr. Winterkorn resigned as
chief executive in September
2015 after U.S. authorities disclosed Volkswagen had been
cheating on emissions tests for
a decade. At the time, he denied knowing that Volkswagen
had rigged diesel engines to
cheat emissions tests.
—William Boston in Berlin
and Chester Dawson
contributed to this article.
Mr.
Colman
invested
in Theranos through the Lucas Venture Group, a venturecapital firm. Indirect shareholders like him who invested
through venture funds collectively put about $70 million
into Theranos, according to
the documents. Mr. Colman
declined to comment through
his lawyer.
The largest individual investor in Theranos was Rupert
Murdoch, who invested $125
million in March 2015, only to
sell back his shares to the company for one dollar in early
2017, according to people familiar with the matter.
Under the terms of that buyback deal, Mr. Murdoch, who is
executive
chairman
of
21st Century Fox Inc. and News
Corp, the Journal’s parent company, received an additional $4
million from Theranos when
the firm reached a separate settlement with a hedge-fund investor, the people familiar with
the matter say.
The hedge fund, San Francisco-based Partner Fund
Management, invested $96
million in Theranos in early
2014. After it sued the company
for
fraud
in
October
2016, Theranos agreed in a settlement to pay it $43 million in
the spring of 2017 without admitting or denying wrongdoing,
according to people with
knowledge of the settlement’s
terms. The Partner Fund settlement triggered the additional
payment to Mr. Murdoch, these
people say.
Mr. Murdoch and his shareholdings don’t appear in the
documents unsealed Thursday
because he had sold back his
stock when the Colman suit’s
discovery phase began.
Also absent from the documents are the identities and
shareholdings of earlier investors who invested another
nearly $100 million in Theranos before 2013.
Shop 'Til You Drop
Defaults by U.S. junk-rated
companies are still low, but
retailers are showing stress.
Corporate default rate
All U.S. speculative-grade
loans and bonds
U.S. retail and apparel sector
16%
Forecast
14
12
10
8
6
4
2
0
2006
’10
Source: Moody's Investors Service
THE WALL STREET JOURNAL.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | B3
NY
BUSINESS NEWS
Musk’s Nerve Tests Limits
Some analysts wonder
if dismissive stance
on call served to mask
problems at Tesla
Gamers played Activision’s ‘Overwatch’ in Tokyo last year.
In-Game Spending
Bolsters Activision
BY SARAH E. NEEDLEMAN
AND AUSTEN HUFFORD
Dow Jones Newswires, the
professional business-information service operated by The
Wall Street Journal’s publisher, inadvertently published
select earnings results, including an incorrect revenue number, for Activision’s latest
quarter ahead of their scheduled release. The company
then released its full earnings
report during trading hours on
Thursday.
Shares in Activision, which
declined as much as 6% after
the early report, closed down
2.3% at $66.82.
“We regret our error as
well as inadvertently breaking
the embargo,” Dow Jones said
in a written statement. “We
have issued a correction and
are reviewing our processes.”
In its earnings report, Activision Blizzard said the January launch of a league for its
“Overwatch,” a cartoonish
shooter videogame, has attracted millions of viewers,
boosting combined play and
watch times. Other game makers are trying to create
leagues that mirror the structure of traditional professional
athletics, including Take-Two
Interactive Software Inc. and
Riot Games Inc.
Activision Blizzard Inc. reported record first-quarter results Thursday, with revenue
and profit rising by doubledigit percentages thanks to increased in-game spending in
key titles such as “Call of
Duty: World War II” and
“Candy Crush Saga.”
While the company didn’t
put out any significant new releases during the quarter, it
said revenue increased 14% to
$1.97 billion from the yearearlier period. The company
posted a profit of $500 million, or 65 cents a share, up
17% from $426 million, or 56
cents a share.
Activision Blizzard exceeded its own forecast for
first-quarter revenue by $145
million and profit by 18 cents
a share.
“Our business is strong on
all fronts,” Chief Executive
Bobby Kotick told The Wall
Street Journal.
The “Call of Duty” publisher raised its full-year outlook slightly and said it now
expects revenue of $7.36 billion and profit of $1.79 a
share.
Elon Musk’s swagger has
helped win admirers and embolden Tesla Inc. investors.
This time, the billionaire chief
executive may have gone too
far.
On Thursday, Tesla’s shares
fell 5.6%, erasing about $3 billion in market value a day after
Mr. Musk sparred with Wall
Street analysts in a show of defiance rare for traditionally
staid conference calls to discuss
a company’s quarterly results.
Several analysts reconsidered their outlooks for the Silicon Valley auto maker struggling to take on the century-old
automotive industry.
Chief executives of publicly
traded companies typically grit
their teeth and coolly dance
around pointed questions during these calls. Mr. Musk chose
instead to dismiss analysts over
their “boring, bonehead” questions, cutting off two of them
when they asked about Tesla’s
capital requirements and customer reservations for the
Model 3 sedan.
“This is a financial analyst
call—this is not a TED talk,”
Toni Sacconaghi, an analyst
with Sanford C. Bernstein &
Co., said on CNBC Thursday after he was cut off by Mr. Musk
on the call. “So when financial
questions are asked, they
should be addressed.”
In some ways, the combativeness was classic Elon Musk.
The billionaire entrepreneur
has made defiance of convention his calling card in a relentless pursuit to upend transportation, and in his eyes, save the
world with driverless electric
cars and rocket launches to
Mars. He fires off Twitter posts
at late hours rebutting critics
who he believes get in the way,
and he often makes grandiose
statements about the future of
technology.
BRENDAN SMIALOWSKI/AGENCE FRANCE-PRESSE/GETTY IMAGES
AKIO KON/BLOOMBERG NEWS
BY TIM HIGGINS
“Boring, bonehead questions are not cool—next.”
Tesla CEO Elon Musk
Mr. Musk’s bravado has polarized investors, pitting short
sellers who are sure Tesla is
headed for demise, against the
“longs” who believe his vision
will win out. The backers have
so far prevailed, giving Mr.
Musk room to make, and sometimes miss, overly ambitious
goals and lifting Tesla’s market
value to rival those of General
Motors Co. and Ford Motor Co.,
much larger auto makers.
But even for Mr. Musk, the
impertinent answers to analysts from big banks was jarring and raised questions
whether he was masking Tesla’s
problems. On the call, he
seemed more eager to talk
about the future of Tesla—selfdriving cars or the next electric
vehicle—than the state of the
business after the Silicon Valley
auto maker burned through
about $1 billion during the first
quarter as production struggles
continued to beset the Model 3
sedan.
Following the call, which
was broadcast for investors online, analysts sent notes to clients that characterized Mr.
Musk’s exchange as “bizarre
theatrics” and “odd,” and said
Mr. Musk might have struck
some as being “dismissive” and
“unhinged.” At least three analysts dropped their price targets.
Late Wednesday, while Mr.
Musk began deflecting questions on the call, Tesla’s stock
fell more than 5% in about a
20-minute span during afterhours trading.
Mr. Musk’s frustration bubbled up about a half-hour into
the call when Mr. Sacconaghi
asked about Tesla’s target date
for achieving 25% gross margins on the Model 3—which,
the analyst said, the company
seemed to have pushed back by
six to nine months from the
goal stated just last quarter.
Chief Financial Officer
Deepak Ahuja attributed the
delay, in part, to added labor
costs and a weak dollar. Mr.
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Musk interrupted to say the
gross-margin difference is a
matter of three to five percentage points and will be resolved
in three to six months.
“Don’t make a federal case
out of it,” he said.
Mr. Sacconaghi, who cowrote a report last month questioning Tesla’s ability to automate its factory, then turned to
the company’s investment
plans. Tesla had previously said
it expected spending this year
to about match last year’s $3.4
billion, but on Wednesday announced it was scaling back
plans to less than $3 billion,
which could ease its cash
crunch.
When Mr. Sacconaghi asked
what the company’s specific
capital requirements would be,
Mr. Musk cut him off.
“Boring, bonehead questions
are not cool—next,” Mr. Musk
said, turning to the operator for
the next question.
—Ben Eisen
contributed to this article.
.
B4 | Friday, May 4, 2018
* ***
THE WALL STREET JOURNAL.
TECHNOLOGY
WSJ.com/Tech
Xiaomi Is on Track for Year’s Biggest IPO
Chinese smartphone
maker seeks to raise
$10 billion as it shifts to
software and services
Dialing Up
Xiaomi's IPO would be the third-largest tech stock sale globally,
based on its expected target of raising at least $10 billion.
Top 10 technology IPOs
Alibaba Group
2014, New York
BY DAN STRUMPF
AND JULIE STEINBERG
$25.0 billion
Facebook
May 2012, Nasdaq
Xiaomi
2018, Hong Kong
10.0
Infineon Technologies
2000, Frankfurt/New York
GIULIA MARCHI/BLOOMBERG NEWS
HONG KONG—Xiaomi Corp.,
one of China’s largest and bestknown smartphone brands, is
on course to launch the biggest
stock sale the world will see
the year. Its success hinges on
whether it can convince investors that it is more than just a
gadget company.
The Beijing-based company
Thursday laid the groundwork
for a blockbuster initial public
offering in Hong Kong, capping
a remarkable turnaround for
what only 18 months ago was
looking like one of China’s biggest tech flameouts.
Now, Xiaomi has to justify
the sky-high valuation it is
seeking.
While the company didn’t
disclose the terms of its stock
sale in its filing with the Hong
Kong stock exchange, people
familiar with the matter say it
is looking to raise at least $10
billion in the deal.
The listing will likely value
Xiaomi at less than $100 billion, according to people familiar with the matter, a figure
lower than previously had been
discussed. Xiaomi declined to
comment on the valuation.
Investors are being asked to
buy into Xiaomi’s transition
from a maker of hardware into
a provider of software and ser-
16.0
5.9
Agere Systems
2001, New York
4.1
Snap
2017, New York
3.9
Worldpay Group
2015, London
3.8
Japan Display
2014, Tokyo
3.1
First Data
2015, New York
2.8
Xiaomi’s low-cost phones have won it a loyal fan base in China, India and other emerging markets.
World Online International
2.8
2000, Amsterdam
vices, a shift that other big tech
companies have been making
as both hardware margins and
the smartphone market shrink.
Xiaomi also has its eye on
bigger sales overseas, including
in the U.S., at a time when
Washington has been targeting
other Chinese phone makers
and tech companies.
That all could prove to be
tough sell for Xiaomi. The company, revealing its financial results for the first time, said its
share of revenue from internet
services fell to 8.6% last year
from 9.6% in 2016. A person familiar with the matter said this
is the company’s most profitable segment.
Xiaomi drew 70% of its $18
In a public letter released
Thursday, Mr. Lei described Xiaomi as an “innovation-driven
internet company,” reflecting
its wish to generate more sales
from software and online services and less from hardware.
Xiaomi’s filing also laid out
Mr. Lei’s tight control of the
company: Any meeting of the
board of directors must include
him. Xiaomi also disclosed that
it rewarded Mr. Lei in April
with 64 million shares for “contributions to our company.”
Xiaomi reported a loss of
43.89 billion yuan ($6.9 billion)
last year. Excluding one-time
charges, it had a profit of 5.36
billion yuan.
Xiaomi’s Hong Kong listing
billion in revenue from smartphone sales last year.
“The whole premise of the
business model is generating
revenue from internet services,” said Neil Shah, an analyst at Counterpoint Research,
which follows the smartphone
industry. “Ideally, the services
revenue would be much higher
to give confidence to investors.”
Xiaomi, founded in 2010 by
Chinese entrepreneur Lei Jun,
is the world’s fourth-largest
smartphone vendor, trailing
Samsung Electronics Co., Apple
Inc. and Huawei Technologies
Co. It also makes such devices
as internet-connected rice
cookers, body weight scales
and electric scooters, all connected through a software platform known as MIUI. Xiaomi
said it had 190 million MIUI
monthly active users as of
March.
Its low-cost yet stylish
phones, such as its Redmi series, have won it a loyal and often passionate fan base in
China, India and other emerging markets.
In March, it launched a new
version of its Mi Mix 2 flagship
phone priced at 3,299 yuan
($518). At the launch event at a
stadium in Shanghai, Mr. Lei
frequently compared the phone
to Apple’s iPhone X, boasting of
better photography, longer battery life and a lower price tag.
Sources: Dealogic; staff reports (Xiaomi)
THE WALL STREET JOURNAL.
is expected to be followed
shortly by a listing on the Chinese mainland, according to
people familiar with the matter.
Of major importance for Xiaomi is its continued success
overseas, where it made nearly
a third of its revenue last year.
On Thursday, the company
unveiled an alliance with CK
Hutchison Holdings Ltd. in
which the conglomerate will
sell Xiaomi devices through
stores in Austria, Denmark,
Hong Kong, Ireland, Italy, Sweden and the U.K.
—Kenan Machado
contributed to this article
Heard on the Street: Xiaomi
has to dial back hype......... B12
Hacking Fears
Revive Windows
A sharp increase in cyberattacks gave Microsoft Corp.’s
ubiquitous Windows operating
system the kind of lift it hasn’t
seen in years, as fears of getting hacked prompted companies to upgrade their computers faster than they otherwise
might have.
When the software giant reported quarterly earnings last
week, it surprised several analysts, notching an 11% jump in
sales of Windows 10 licenses
for computers sold primarily
to corporate customers, from a
year earlier.
Bulk sales of Windows licenses and related cloud services, meanwhile, jumped 21%.
Windows 10 is Microsoft’s
most-current version of its operating system and used
widely in computers worldwide.
Cyberattacks plagued corporations last summer, rendering PCs running older and unpatched version of Windows
useless, leading some corporate tech buyers to upgrade.
The increases were especially notable, analysts say, because personal-computer shipments world-wide had no
growth in the period, according to International Data Corp.
Also, sales growth in the
unit that houses Windows,
called More Personal Computing, had been moribund for
New Opening
Windows, a part of Microsoft's
More Personal Computing
segment, is benefiting from
companies' fears of cyberattacks.
Change in More Personal
Computing revenue
from previous year
15%
10
5
0
0
–5
–10
1Q
FY2017
1Q
’18
Note: Fiscal year ends June 30.
Fourth-quarter estimate for the 2018
fiscal year is in middle of the company's
estimated range.
Source: Microsoft
THE WALL STREET JOURNAL.
The WannaCry and Petya cyberattacks highlighted vulnerabilities in older and inadequately patched versions of Windows.
years.
What’s more, Microsoft said
revenue for the segment that
includes Windows, an aging
franchise whose epitaph has
been regularly written, is expected to grow about 13% in
the current quarter.
The optimistic forecast for
Windows comes as the company is downgrading the operating system’s importance.
Cedars-Sinai Health System
in Los Angeles is close to
completing its upgrade of
nearly 20,000 computers to
the nearly three-year-old
Windows 10, said Darren
Dworkin, the system’s chief
information officer.
Although the upgrade
didn’t come about because of
cyberattacks, Mr. Dworkin
said he is worried about
them.
“There are more reasons
now for wanting to keep current,” Mr. Dworkin said.
The number of data
breaches in the U.S. jumped
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PRIVACY
Continued from page B1
that users typically consider
private, one of the people said.
Employees with such permission can access others’ accounts to diagnose technical
errors, test new features or investigate possible criminal behavior in response to a legal
request, according to Facebook
officials and former employees.
When using the internal
software, Facebook employees
must give a legitimate reason
for accessing the profile; the
explanations are read by managers later. It is considered
best to have written permission, former employees said.
Facebook employees have
been fired for improperly accessing user profiles over the
years, according to former employees. Unauthorized access
of others’ profiles, even if the
spouse or minor child of an
employee, is a fireable offense,
one of the people said.
Employees, though, are always notified when Facebook
engineers access their accounts,
45% to 1,579 in 2017, according
to the nonprofit Identity Theft
Resource Center and data-security firm CyberScout.
The WannaCry and Petya
cyberattacks in 2017 highlighted glaring vulnerabilities
of older and inadequately
patched versions of Windows.
The attacks, which locked
digital files and demanded
payment for them to be released, disrupted operations at
the British health agency as
well as car factories in France,
a law firm in the U.S. and elsewhere.
In targeting older Windows
versions, those attacks helped
boost Windows 10 sales.
Windows also benefits from
being the operating system of
choice for corporate customers, said Patrick Moorhead, an
analyst with the research firm
Moor Insights & Strategy.
Some version of the operating system is on 88% of the
world’s desktops and laptops
connected to the web, accord-
ing to analytics website NetMarketShare.
“There’s not an easy replacement for the Windows
PC,” Mr. Moorhead said.
One reason for Microsoft’s
upbeat expectations for the
current quarter is that even
though there are nearly 700
million devices—mostly PCs
but tablets, Xbox machines
and other devices—running
Windows 10, there are an additional 800 million devices
running older versions.
even when the company is investigating a possible crime or
wrongdoing, the person said.
The internal alert system
was created because Facebook
engineers were routinely testing future products or fixing
technical issues using employee profiles, the person
said. The official name of the
tool was changed in 2015 to
“Security Watchdog,” but the
Sauron name is still widely
used, the person added.
The Sauron notification has
been available for years, the
people familiar with the matter
said. Employees typically get
an email or a notice to their
Facebook account. Employees
can often uncover the reasons
for that access through an internal bug report or by flagging
it to Facebook’s security team.
Lawmakers, Facebook users
and others have voiced concern about the company’s
sometimes lax policies for controlling the vast stores of information it collects on people.
Partly in response to those
concerns, Facebook has provided users with more information about the kind of data it
tracks as well as more options
to remove that data. It redesigned its app and tried make
it simpler for users to examine
and change some of the data
Facebook tracks. This week,
Chief Executive Mark Zuckerberg announced that the company would provide a way for
users to see and delete web activity that Facebook tracked.
But there remains a gulf between what Facebook knows
about its users and what many
of them understand about the
company’s capabilities.
Three years ago, Paavo Siljamäki, a director at the record label Anjunabeats and
part of the dance music group
Above & Beyond, said in a
Facebook post that an engineer for Facebook had accessed his account during his
visit to the company’s Los Angeles office. Mr. Siljamäki said
he had given his permission,
but not his login credentials.
“A Facebook engineer can
then log in directly as me on
Facebook seeing all my private
content without asking me for
the password,” Mr. Siljamäki
wrote. “Just made me wonder
how many of Facebook’s staff
have this kind of ‘master’ ac-
cess to anyone’s account?”
At the time, Facebook responded by explaining the
controls were in place to prevent abuse. Mr. Siljamäki
didn’t respond to a request for
comment this week.
The latest incident in which
the Facebook employee was
fired was surfaced publicly in
a tweet Sunday by security
consultant Jackie Stokes that
included a photo of what appeared to be a text exchange
between the woman from the
dating site and the engineer.
The engineer told her his job
involved tracking hackers and
finding their identities, according to an apparent transcript of
the conversation posted on
Twitter by Ms. Stokes.
Ms. Stokes said in an interview that the woman told her,
“I’m terrified. I think he has
things on me.” The woman,
asked via Ms. Stokes, declined
to be interviewed.
After Ms. Stokes’s tweets,
Facebook employees including
Mr. Stamos, the chief security
officer, contacted her about
the episode.
—Robert McMillan
contributed to this article.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | B5
NY
* * * *
TECHNOLOGY
BY GEORGIA WELLS
Twitter Inc. on Thursday
said it found a bug in how it
stored user passwords that
could have left them visible to
people in its internal computer
system.
Twitter urged its users to
change their passwords, but
said an investigation showed
no indication of a breach.
“We are very sorry this
happened,” Twitter’s chief
technologist Parag Agrawal
said in a blog post. Twitter’s
disclosure came on Thursday,
a day that corporations and
some government officials
observe as “World Password
Day.”
To protect users’ passwords, Twitter uses a common
technology that masks passwords so that no one within
Twitter can view them. The
mistake Twitter identified on
Thursday undid this layer of
security protection.
The company uses a cryptographic technique to convert
users’ passwords into a unique
string of letters and characters, called a hash, which is
stored on Twitter’s servers
and used to authenticate login
attempts.
But, due to the bug, Twitter
ended up storing the passwords before this hashing process had been completed,
meaning that they could have
been stolen by a hacker or an
insider with access to Twitter’s internal networks. Twitter didn’t say how many accounts were affected.
Previous security flaps at
Twitter have been more serious. In 2016, Twitter notified
millions of users that their accounts were at risk of being
taken over after a database
containing nearly 33 million
purported usernames and
passwords for Twitter accounts was made public.
Twitter users can change
their passwords by going to
the password settings page.
—Robert McMillan
contributed to this article
Equifax Directors Hold Seats
BY ANNAMARIA ANDRIOTIS
Equifax Inc. shareholders
voted to re-elect all of the
company’s board members
who were on the ballot, though
several directors including the
board’s chairman received a
significant number of votes
against their re-election.
The company announced
the tallies Thursday after its
annual shareholder meeting,
the first since it disclosed a
major data breach last September in which personal information on 147.9 million U.S.
consumers was compromised.
Board Chairman Mark
Feidler received about 64% of
the votes tallied in favor of reelection with about 35.5% voting against him and a tiny
share abstaining. Board member John McKinley received
the second most votes against
re-election, with about 64.6%
voting in his favor. A third,
Mark Templeton, received
68.2% of the vote in his favor.
The three were on the technology committee during the
breach. CtW Investment Group
advised against their re-election.
Equifax released a statement from Mr. Feidler saying
“that while progress has been
made since the cybersecurity
incident, there is still more
work to do, and we will continue to be in regular contact
with our shareholders.”
Proxy advisory firm Institutional
Shareholder
Services Inc. had called for the
defeat of the three men as
well as G. Thomas Hough and
Elane Stock. Mr. Hough won
with 78.8% of the shares. Ms.
Stock won with nearly 80%.
SAMSUNG C&T/YONHAP/REUTERS
Twitter Urges
Password Resets
Samsung C&T stockholders voted on the takeover offer from Cheil Industries during a general meeting in Seoul in 2015.
Samsung Deal Roils Again
BY TIMOTHY W. MARTIN
AND EUN-YOUNG JEONG
SEOUL—The merger of two
Samsung affiliates in 2015 is
drawing fresh scrutiny this
week, wiping out billions of
dollars of stock-market value
and creating new headaches for
South Korea’s biggest conglomerate.
The country’s financial regulators issued a warning Tuesday to Samsung BioLogics Co.,
the conglomerate’s contract
drug-manufacturing arm, for
alleged accounting irregularities. In the wake of the news,
shares in the company—which
figures into the 2015 merger—
plunged, erasing $6 billion in
market capitalization over two
days.
Meantime, U.S. activist
hedge fund Elliott Management Corp. said this week that
it is taking legal action against
the South Korean government
for its role in approving the
merger of Samsung C&T Corp.
and Cheil Industries Inc., which
created a de facto holding company in which third-generation
heir Lee Jae-yong wound up
holding a large stake.
At the time of the merger in
2015, the deal drew criticism
from foreign investors and corporate-governance advocates,
including Elliott, which saw it
as unfair to minority shareholders. Elliott opposed the deal
and rallied shareholders against
it.
A warning by Korean
regulators triggers a
stock selloff in
Samsung BioLogics.
The deciding vote in favor of
the deal was cast by South Korea’s National Pension Service,
which is overseen by the Ministry of Health and Welfare.
Since then, several of the
deal’s central figures have been
charged with bribery and imprisoned, including the head of
the pension service and Mr.
Lee, a vice chairman of Sam-
sung Electronics Co. Mr. Lee
has denied wrongdoing.
The surrounding scandal
also led to the conviction of
South Korea’s then-President
Park Geun-hye on multiple
charges including bribery.
The renewed scrutiny of the
deal could mean continued turbulence for the Samsung conglomerate, several months after
Mr. Lee was released from
prison on a suspended sentence. It also shines a spotlight
on South Korea’s National Pension Service, the world’s fourthlargest pension fund.
Samsung BioLogics’s accounting methods drew regulators’ attention because the
company, in which Samsung
C&T held a 43% stake as of the
end of 2017, changed its accounting practices in the runup to the 2015 merger. That allowed the drug manufacturer to
report a rise in profit following
years of losses—a reversal of
fortune that some skeptics suspect was engineered to sweeten
the deal’s prospects.
On Tuesday, South Korea’s
Financial Supervisory Service
issued a preliminary notice to
Samsung Biologics and its auditors, contending the company
violated accounting rules. The
subsequent two-day selloff
erased roughly one-fifth of the
company’s market value, pushing shares to their lowest level
in three months.
A Samsung Biologics spokesman said the company would
cooperate with the investigation, adding that it had changed
its accounting methods in 2015
because a shareholder, Biogen
Inc., wanted to boost its equity
stake, requiring the adoption of
the new standard. The spokesman said external auditors had
later signed off on the move.
If financial regulators conclude
Samsung
Biologics
breached accounting rules, the
drug manufacturer could be
subject to a fine of up to 20% of
its accounting-fraud value and
have its trading suspended, Seo
Mi-hwa, an analyst for Yuanta
Securities Korea, said in a note
to clients Thursday.
Financial regulators haven’t
said when they will make a final decision on the probe.
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B6 | Friday, May 4, 2018
NY
* ***
THE WALL STREET JOURNAL.
BUSINESS NEWS
GE Weighs Chapter 11 for Subprime Unit
Firm says bankruptcy
would let arm WMC
Mortgage deal with
potential legal losses
BY KATY STECH FEREK
AND THOMAS GRYTA
General
Electric
Co.
warned it might put its dormant subprime mortgage business, long plagued by legal
trouble, into bankruptcy protection.
A bankruptcy filing could
be a way for the lender, WMC
Mortgage, to deal with potential courtroom losses and
other future liabilities, the
company said late Tuesday in
a filing with the Securities and
Exchange Commission.
A GE spokeswoman declined to comment beyond the
filing.
GE recently set aside a $1.5
billion reserve related to a
Justice Department investigation into the WMC Mortgage
business, which stopped
nearly all new loan originations in 2007.
WMC Mortgage was a large
mortgage lender to people
with low credit scores before
the financial crisis. GE Capital
Corp., the company’s finance
unit, bought the subprime
lender in 2004 and sold the
operation’s assets in 2007 after racking up about $1 billion
in losses in that year alone.
Even though WMC Mortgage’s
assets were sold, it is still part
of GE Capital.
Putting WMC Mortgage into
bankruptcy protection would
make GE the latest major corporation to use the chapter 11
process to deal with years-old
mortgage problems in court.
Ally Financial Inc., General
Motors Co.’s ex-financing arm,
put its mortgage business into
bankruptcy in 2012 as a way
to get out from under billions
of dollars in lawsuits. The
WMC Mortgage bankruptcy
warning in GE’s filing was earlier reported by CNN.
It is unclear how much exposure GE could shed by putting WMC Mortgage into
$3.4B
GE faces this much in claims
from mortgage-related lawsuits
bankruptcy. The process could
accelerate settlements that GE
agrees to fund. At a minimum,
the filing would temporarily
PARAMOUNT/EVERETT COLLECTION
Studio Relativity Media Re-Enters Bankruptcy Protection
Troubled upstart film studio
Relativity Media LLC, which
emerged from a previous stint in
bankruptcy protection about two
years ago, filed for chapter 11
again Thursday with a deal to sell
its assets to a joint venture that
intends to revitalize the studio.
Since Relativity’s first bumpy
ride through chapter 11, founder
and Chief Executive Ryan Kavanaugh has been unable to raise
any meaningful investment to resuscitate the company, which has
laid off or furloughed nearly all of
its staff. Colin Adams, Relativity’s
newly retained chief restructuring
officer, is now managing the
company’s affairs, according to
court papers.
The venture, UltraV Holdings
LLC, will acquire Relativity’s assets, which include a valuable distribution deal with Netflix Inc.,
through a bankruptcy-sale process, giving the studio another reboot. The sale, which Relativity
hopes to close within 45 to 60
days, is subject to approval from
Judge Michael Wiles of the U.S.
Bankruptcy Court in New York,
who also oversaw Relativity’s
first chapter 11 case.
On Thursday, the studio,
whose films include “The Fighter,”
with Mark Wahlberg, pegged its
total liabilities at more than $500
million with total assets valued
somewhere between $10 million
and $50 million.
stop litigation against the unit
as it looks to cap its exposure.
In the SEC filing, GE officials said they are having
trouble estimating the exact
loss the company could face
from the Justice Department
investigation and several lawsuits involving the subprime
business.
In February, GE disclosed
that government officials are
likely to claim the business violated federal lending laws in
2006 and 2007.
One case against WMC
Mortgage involving $800 million in loans went to trial this
year in federal court in New
Haven, Conn. Testimony in-
NIKE
Continued from page B1
turn to about their situation,
the people said.
The Wall Street Journal in
March reported that Nike was
investigating allegations of inappropriate behavior after a
group of women at the company had circulated a survey
that reached Mr. Parker. Last
month, the Journal reported
on flaws in Nike’s human-resources department and employees’ complaints of a boys
club culture at the company.
Mr. Parker sent an email to
staff earlier Thursday inviting
them to the meeting and saying he wanted “everyone to
know that I’m personally committed to making Nike a place
where everyone can thrive in
an environment of respect,
empathy, and equal opportunity for all.”
In recent days, Nike has
promoted two women to senior leadership roles. On Monday, Amy Montagne was
named vice president and general manager of global categories, giving her oversight of
several major business units,
including women’s, running,
training and basketball.
Last week, the company
named Kellie Leonard as its new
chief of diversity and inclusion.
cluded examples of individual
applicants applying for multiple loans within weeks of
each other, while showing
drastically higher income or
misrepresenting other information on documents. Closing
arguments are scheduled for
June.
The total claims GE faces
tied to the mortgage-related
lawsuits is $3.4 billion, according to regulatory filings. The
company already had set aside
a reserve for the lawsuits,
standing at $342 million at the
end of March, but said in
Tuesday’s filing it could face
as much as $500 million in additional losses.
Ms. Montagne and Ms.
Leonard, Nike veterans with
more than a decade apiece at
the company, filled positions
vacated in recent weeks by
men. Ms. Montagne was previously head of Nike’s women’s
business, while Ms. Leonard
was formerly vice president of
communications.
Several senior male employees have abruptly left Nike or
resigned their positions since
March, including the No. 2 executive, Trevor Edwards. Mr.
Edwards resigned from his position and will retire from the
company in August. He hasn’t
responded to requests for
comment.
According to interviews
with current and former employees, several issues at Nike
hastened the recent upheaval.
Last year, a group of female
employees began circulating
an informal survey to take
stock of what they considered
to be disparities in pay and
promotions for women at the
company, as well as alleged inappropriate behavior. The survey was brought to the desk of
Mr. Parker earlier this year,
these people said.
Also last year, Mr. Parker instructed the head of human resources to leave the company,
following at least two internal
investigations into his management, according to people familiar with the matter.
BUSINESS WATCH
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The Whole Foods rival used a
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Pringles and Eggo
Provide a Boost
Kellogg Co. said Pringles
chips, Eggo frozen waffles and
demand in emerging markets
helped the food maker post a
strong quarter even as cereal
sales in the U.S. remained soft.
Kellogg’s revenue rose 4.7% to
$3.4 billion in the first quarter,
helped by last year’s $600 million
acquisition of protein-bar maker
RXBAR. On a comparable basis,
sales were up 0.6%.
Kellogg’s quarterly profit rose
11% to $1.19 a share on an adjusted basis. The company’s
business in West Africa led to
improved guidance for the year.
It now expects sales growth of
3% to 4% and adjusted earnings
per share growth of 9% to 11%,
both excluding the impact of foreign-currency translation.
—Annie Gasparro
million digital subscribers, with
subscription revenue making up
63% of its top line. Print advertising declined 1.8% to $78.9 million, the smallest year-over-year
decline since 2015.
The company posted a profit
of $21.9 million, or 13 cents a
share, compared with a profit of
$13.2 million, or 8 cents a share,
in the same period a year before.
On an adjusted basis, the company brought in 17 cents a share.
—Austen Hufford
NEW YORK TIMES
Digital Subscriptions
Bolster Revenue
New York Times Co. posted a
3.8% rise in revenue for the first
quarter as continued growth in
digital subscriptions offset a
weak stretch for the company’s
online advertising business.
Revenue from subscriptions increased 7.5% in the period to
$260.6 million, even as growth
has slowed from peaks reached
near the 2016 presidential election. The company had a net increase of 139,000 digital-only subscribers in the first quarter, down
from 348,000 in the year-earlier
period. In both cases, the figures
include crossword subscriptions.
Digital-advertising revenue fell
6% on a year-over-year basis to
$46.7 million.
The Times ended the first
quarter with more than 3.7 million subscribers, including 2.8
UNITED AIRLINES
Carrier Recruits
White House Ex-Aide
United Airlines said Thursday
it had tapped former White
House press chief Josh Earnest
to head its communications team,
part of the effort to improve the
fortunes of a carrier damaged by
everything from poorly received
growth plans to the death of a
dog in an overhead bin.
Mr. Earnest, a former press
secretary under President Barack
Obama, has been hired as a senior
vice president at parent United
Continental Holdings Inc. to oversee communications for a carrier
that is a touchstone for the fortunes of the U.S. airline industry.
He succeeds Jim Olson, who
joined from Starbucks Corp. and
departed after two years last
December.
—Doug Cameron
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | B7
MARKETS DIGEST
EQUITIES
S&P 500 Index
Dow Jones Industrial Average
Last Year ago
23930.15 s 5.17, or 0.02%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio 23.63 20.46
P/E estimate *
16.17 17.83
Dividend yield
2.23
2.34
All-time high 26616.71, 01/26/18
Current divisor 0.14523396877348
Session high
2629.73 t 5.94, or 0.23%
High, low, open and close for each
trading day of the past three months.
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
Session low
Last Year ago
7088.15 t 12.75, or 0.18%
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
2800
7500
2750
7300
25200
2700
7100
24400
2650
6900
23600
2600
22800
2550
22000
2500
65-day moving average
26000
Open
t
Close
Year ago
26800
UP
Close
t
DOWN
Session open
Nasdaq Composite Index
Last
65-day moving average
65-day moving average
6700
6500
Bars measure the point change from session's open
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
26616.71 20606.93
14.2
-3.2
9.9
11373.38
8783.74
12.2
-3.4
5.5
Most-active issues in late trading
-2.65
-0.38
774.47
647.90
0.3
-3.1
5.9
27373.54 26946.09 27295.31 -66.05
707.97
698.25
705.71 -4.19
-0.24
29630.47 24391.29
757.37
624.99
10.3
10.7
-1.4
-0.7
7.4
7.2
Net chg
% chg
23996.15 23531.31 23930.15
5.17
52-Week
Low
High
0.02
Transportation Avg 10307.39 10080.84 10254.64 -31.27
703.91
Utility Average
693.44
Nasdaq Stock Market
Nasdaq Composite
7112.59
Nasdaq 100
6667.29
% chg
% chg
3-yr. ann.
YTD
700.94
6991.14
6539.86
-0.59
7088.15 -12.75
6643.48 -1.00
7588.32
7131.12
-0.18
-0.02
6011.24
5580.55
2.7
3.9
16.7
18.1
12.3
14.0
S&P
500 Index
2637.14
2594.62
2629.73
-5.94
-0.23
2872.87
2357.03
10.1
-1.6
7.6
MidCap 400
SmallCap 600
1878.56
951.27
1852.04
939.07
1872.56
947.08
-3.27
-6.33
-0.17
-0.66
1995.23
979.57
1691.67
817.25
8.6
12.1
-1.5
1.2
7.4
10.2
Other Indexes
Russell 2000
1552.29
1532.31
1546.56
-8.36
-0.54
1610.71
1355.89
11.4
0.7
8.0
13637.02 11423.53
NYSE Composite
12419.70 12255.85 12392.50 -25.56
Value Line
NYSE Arca Biotech
548.41
540.64
4506.09
4396.18
545.58
-0.52
4423.33 -42.18 -0.94
NYSE Arca Pharma
518.71
511.21
516.46
-1.25
106.07
103.73
-0.77
PHLX§ Gold/Silver
105.46
83.32
82.14
0.46
PHLX§ Oil Service
82.38
155.10
151.62
153.75
1272.55
18.66
1240.30
15.43
1267.44
15.90
PHLX§ Semiconductor
Cboe Volatility
-0.21
-2.83
KBW Bank
-0.24
-0.73
0.56
-1.28 -0.82
8.02
-0.07
0.64
-0.44
Nasdaq PHLX
YTD
% chg
–0.32
–0.33
–0.45
–2.0
–1.4
–1.4
DJ Americas
631.15
–0.27
–1.71
Sao Paulo Bovespa 83288.14 –1258.94 –1.49
S&P/TSX Comp
15621.47
–0.04
–6.46
S&P/BMV IPC
47094.13 –715.85 –1.50
Santiago IPSA
4219.53
–50.03 –1.17
–1.7
9.0
–3.6
–4.6
0.2
Close
Asia-Pacific
Australia
China
Hong Kong
India
Japan
Singapore
South Korea
Taiwan
Thailand
Net chg
–9.68
–1.31
–1.18
3023.22
391.48
263.02
The Global Dow
DJ Global Index
DJ Global ex U.S.
EMEA
Eurozone
Belgium
Denmark
France
Germany
Israel
Italy
Netherlands
Russia
South Africa
Spain
Sweden
Switzerland
Turkey
U.K.
U.K.
-3.3
3.6
503.24
5.0
-3.0
2.1
4939.86
3507.64
20.3
4.8
4.4
Volume
(000)
Symbol
SPDR S&P 500
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
–1.2
1.3
–2.7
–2.4
3.6
–1.8
–2.7
10.1
1.3
–2.3
–3.7
–0.1
1.3
–5.8
–10.8
–2.4
–1.7
384.62
–2.82 –0.73
390.49
–2.56 –0.65
3871.94
–48.96 –1.25
904.51
–0.59
–5.38
–0.50
5501.66
–27.56
12690.15 –112.10 –0.88
–0.49
1468.91
–7.29
24064.46 –201.15 –0.83
551.73
–4.13 –0.74
1128.22
–8.34 –0.73
57273.88 –1176.56 –2.01
–0.50
10038.80
–50.10
576.37
–6.29 –1.08
8842.29
–0.61
–53.99
102909.13 –1816.61 –1.73
7502.69
–0.54
–40.51
20365.87 –140.40 –0.68
S&P/ASX 200
6098.30
Shanghai Composite 3100.86
Hang Seng
30313.37
S&P BSE Sensex
35103.14
Nikkei Stock Avg
22472.78
Straits Times
3575.68
Kospi
2487.25
TAIEX
10514.18
SET
1790.80
48.10
19.68
–410.51
–73.28
…
–39.60
–18.36
–104.63
–0.33
0.80
0.64
–1.34
–0.21
Closed
–1.10
–0.73
–0.99
–0.02
0.5
–6.2
1.3
3.1
–1.3
5.1
0.8
–1.2
2.1
Sources: SIX Financial Information; WSJ Market Data Group
Liberty Formula One C FWONK 12,068.9
0.50
31.55 -0.004
Low
0.19 263.22 261.61
-0.01
31.55
31.53
GE
3,625.2
13.97
0.04
0.29
13.98
13.62
Bank of America
BAC
3,530.5
29.25
0.05
0.17
29.25
28.99
CVS Health
CVS
3,071.0
62.42
0.15
0.24
63.85
62.27
Schwab Short Trm US Trsr SCHO
2,575.4
49.64
…
unch.
49.64
49.64
Intel
INTC
2,497.3
52.49
0.21
0.40
52.55
51.47
iShares iBoxx $ HY Cp Bd HYG
2,266.0
85.36
…
unch.
85.36
85.32
9.63
11.50
10.49
Percentage gainers…
Titan International
TWI
50.7
11.50
1.01
Vertex Pharm
VRTX
98.9 162.53
12.89
Shake Shack Cl A
SHAK
Pandora Media
P
Qurate Retail QVC A
QRTEA
8.61 162.53 148.49
259.5
51.22
3.81
8.04
51.50
1,402.9
6.19
0.44
7.65
6.33
47.40
5.75
91.9
25.37
1.80
7.62
25.37
23.35
593.12
514.66
-0.3
-5.2
-3.9
...And losers
88.87
13.5
-1.2
12.6
Arista Networks
ANET
93.26
76.42
5.3
-3.4
4.0
QEP Resources
QEP
58.2
11.13
-0.67
-5.68
11.80
165.78
117.79
5.2
2.8 -11.6
Baytex Energy
BTE
51.2
4.25
-0.23
-5.13
4.48
4.25
1445.90
37.32
1006.83
9.14
25.9
52.0
Exelon
EXC
136.0
38.89
-1.96
-4.80
40.90
38.89
Immunogen
IMGN
124.2
10.64
-0.37
-3.32
11.10
10.64
1.1
44.0
21.6
7.8
Company
Symbol
Euro Tech Holdings
Inspire Medical Systems
Presbia
Integrated Media Tech
Technical Communications
CLWT
Staar Surgical
Sharing Economy Intl
China Adv Constr Matrl
BioXcel Therapeutics
YRC Worldwide
STAA
MYR Group
Monaker Group
Xspand Products Lab
Coherus BioSciences
Rudolph Technologies
MYRG
123.4 248.00 -19.85
-7.41 273.00 242.90
11.13
INSP
LENS
IMTE
TCCO
SEII
CADC
BTAI
YRCW
MKGI
XSPL
CHRS
RTEC
52-Week
Low
% chg
High
5.75 3.50 155.56
24.98 8.98 56.13
3.43 1.12 48.40
32.11 10.16 46.29
5.75 1.25 27.78
8.45
...
7.14
44.00
15.40
2.00
...
1.86
1.85
2.30
Company
Symbol
91.7
...
31.8
...
128.4
Heat Biologics
InVivo Therapeutics Hldgs
Check-Cap
Achaogen
Anika Therapeutics
HTBX
LKSD
21.15
4.30
2.65
8.40
9.99
4.40
0.78
0.45
1.38
1.55
26.27
22.16
20.45
19.66
18.36
22.60
12.40
9.75
11.94
17.61
8.95
2.61
1.55
6.76
7.36
108.4
28.0
6.0
...
-6.5
LSC Communications
Cardinal Health
Horizon Global
Hornbeck Offshore
Esperion Therapeutics
35.74
2.45
5.87
14.90
31.05
5.37
0.37
0.87
2.20
4.55
17.68
17.56
17.40
17.32
17.17
37.80 23.00
7.95 2.00
...
...
24.70 8.05
31.78 21.10
6.7
-61.6
...
-22.8
28.3
Laredo Petroleum
Habit Restaurants Cl A
Arcadia Biosciences
Cross Country Healthcare
OraSure Technologies
Neovasc
SPDR S&P 500
Bank of America
iShares MSCI Emg Markets
VS 2x VIX Short Term
NVCN
Finl Select Sector SPDR
Snap
PwrShrs QQQ Tr Series 1
General Electric
iPath S&P 500 VIX ST Fut
XLF
141,683
121,930
107,094
81,541
79,976
SPY
BAC
EEM
TVIX
67,519
67,394
58,584
57,031
46,395
SNAP
QQQ
GE
VXX
A consumer rate against its
benchmark over the past year
Five-year ARM, Rate
52-Week
High
Low
2.00
t
0.00
M J J A S O ND J FMAM
2017
2018
3.25%
877-369-3331
Third Federal Savings and Loan
3.49%
Cleveland, OH
866-627-1785
Clinton Savings Bank
Clinton, MA
3.50%
888-744-4272
Family Federal Savings
Fitchburg, MA
3.50%
978-353-0000
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
2.36
Money market, annual yield
0.35
0.41
Five-year CD, annual yield
1.67
1.68
30-year mortgage, fixed†
4.62
4.58
15-year mortgage, fixed†
4.07
4.04
Jumbo mortgages, $424,100-plus† 4.86
4.89
Five-year adj mortgage (ARM)† 4.64
4.61
New-car loan, 48-month
3.83
4.25
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
4.70
4.27
1.50
1.50
2.08
0.06
0.22
0.68
0.92
0.68
1.36
1.34
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
CCRN
OSUR
Nasdaq
NYSE Arca
Total volume*2,318,441,727 301,179,561
Adv. volume*1,004,132,624 119,024,485
Decl. volume*1,259,236,781 180,038,731
Issues traded
2,955
1,300
Advances
1,013
551
Declines
1,815
730
Unchanged
127
19
New highs
61
6
New lows
82
24
Closing tick
47
19
Closing Arms†
0.70
1.15
Block trades*
10,093
1,571
* 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.
0
0.75
–5
0.00
–10
30
-48.59
-38.77
-27.91
-24.76
-24.68
7.89 1.09
96.25 6.25
26.16 3.12
27.49 9.83
69.81 30.91
-82.5
-90.3
-64.7
-55.7
-21.6
12.64 -4.04 -24.22
50.80 -13.85 -21.42
6.00 -1.54 -20.42
2.90 -0.73 -20.11
36.93 -8.82 -19.28
23.91 11.79
80.37 50.79
19.26 5.99
4.87 1.51
82.68 30.95
-40.6
-30.2
-57.4
-6.8
...
-17.77
-16.10
-16.00
-15.86
-15.73
13.46 7.41
19.75 8.11
66.56 3.60
14.65 9.07
23.01 12.86
-22.0
-55.2
-39.6
-14.6
-4.1
1.28 -1.21
8.26 -5.23
8.81 -3.41
11.06 -3.64
34.80 -11.40
8.98
8.60
9.66
10.61
15.00
-1.94
-1.65
-1.84
-2.00
-2.80
STAA
ATTU
QGBR
IMTE
HEWG
MTGE
ESPR
MOSC
Volume % chg from Latest Session
(000) 65-day avg Close % chg
2,003
4,217
1,245
158
852
18158
3666
3223
2893
2399
141
7,549
8,544
14,835
602
2189
2080
2043
1714
1500
52-Week
High
Low
12.26
26.27
6.72
-1.13
46.29
17.40 3.00
22.60 8.95
10.20 6.25
56.39 50.42
44.00 1.85
5.38 5.49
28.68 -0.31
19.50 8.64
36.93 -19.28
9.68
...
9.85 4.89
30.35 26.39
20.00 16.15
82.68 30.95
9.90 9.49
8.33
21.15
9.84
54.49
32.11
Currencies
U.S.-dollar foreign-exchange rates in late New York trading
15%
1.50
52-Week
Low
% chg
CURRENCIES & COMMODITIES
Yen, euro vs. dollar; dollar vs.
major U.S. trading partners
5
High
* Common stocks priced at $2 a share or more with an average volume over 65 trading days of at least
5,000 shares =Has traded fewer than 65 days
Forex Race
2.25
Latest Session
Close Net chg % chg
Ranked by change from 65-day average*
LINK
10
Euro
US$vs,
YTDchg
Thurs
in US$ per US$ (%)
Yen
Vietnam dong
Argentina peso
.0449 22.2515 19.6
Brazil real
.2836 3.5263 6.5
Canada dollar
.7784 1.2848 2.2
Chile peso
.001617 618.60 0.5
Ecuador US dollar
1
1 unch
Mexico peso
.0525 19.0622 –3.1
Uruguay peso
.03493 28.6300 –0.6
Venezuela b. fuerte .00001568900.0001 666125.1
Europe
WSJ Dollar index
2017
2018
Yield (%)
Last Week ago
52-Week
High
Low
Total Return (%)
52-wk
3-yr
2.809
2.946
3.896
3.310
6.063
3.460
2.596
2.842
2.990
3.876
3.320
6.012
3.480
2.653
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
–1.045
–2.847
0.261
–0.354
2.397
–0.315
1.330
6.460
6.260
6.460
5.279 –0.840 3.943
0.391
–0.482
2.191
1.146
3.173
0.987
2.020
Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch
Australian dollar
.7531 1.3278
China yuan
.1574 6.3537
Hong Kong dollar
.1274 7.8490
India rupee
.01500 66.687
Indonesia rupiah .0000717 13938
Japan yen
.009158 109.19
Kazakhstan tenge .003029 330.10
Macau pataca
.1236 8.0876
Malaysia ringgit
.2535 3.9445
New Zealand dollar
.7042 1.4201
Pakistan rupee
.00865 115.600
Philippines peso
.0193 51.765
Singapore dollar
.7515 1.3307
South Korea won .0009297 1075.56
Sri Lanka rupee
.0063420 157.68
Taiwan dollar
.03369 29.684
Thailand baht
.03163 31.620
Commodities
3.7
–2.3
0.5
4.4
3.4
–3.1
–0.8
0.5
–2.9
0.7
4.5
3.6
–0.5
0.8
2.7
0.1
–3.0
US$vs,
YTDchg
Thurs
in US$ per US$ (%)
Country/currency
Americas
Asia-Pacific
Corporate Borrowing Rates and Yields
Treasury, Ryan ALM
1425.626
10-yr Treasury, Ryan ALM 1664.660
DJ Corporate
368.072
Aggregate, Barclays Capital 1899.530
High Yield 100, Merrill Lynch 2844.003
Fixed-Rate MBS, Barclays 1954.170
Muni Master, Merrill
516.307
EMBI Global, J.P. Morgan
772.949
RKDA
Interlink Electronics
iSh Curr Hdg MSCI Germany
MTGE Investment
Esperion Therapeutics
Mosaic Acquisition Cl A
3.00
Close
HABT
30.33 22.97
23.57 10.51
175.21 135.80
29.47 12.73
64.44 25.59
26.92
10.97
161.80
13.93
41.48
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group
Bond total return index
LPI
Symbol
Country/currency
3.75%
t
HOS
ESPR
-0.85
-0.54
-0.01
-1.76
2.04
2.9
117.6
11.5
-28.8
-1.2
Compare the performance of selected
global stock indexes, bond ETFs,
currencies and commodities at
WSJ.com/TrackTheMarkets
Thursday
HZN
BOXL
s
1.00
Foxboro Federal Savings
Foxboro, MA
CAH
Boxlight Cl A
Staar Surgical
Attunity
SPDR MSCI UK Strategic
Integrated Media Tech
s
3.00
3.00%
800-826-7490
ANIK
1.89
0.03
286.63 235.43
33.05 22.07
52.08 39.79
34.45
4.66
s
4.00%
Langley FCU
Newport News, VA
AKAO
Company
Track the Markets
4.64%
CHEK
100.2 0.04 -4.85
3.3 262.62 -0.22
41.7 29.20 -1.28
6.3 46.22 -0.22
57.8 7.10 3.20
* Volumes of 100,000 shares or more are rounded to the nearest thousand
notes and bonds
Bankrate.com avg†:
NVIV
Volume Movers
Volume % chg from Latest Session
Symbol (000) 65-day avg Close % chg
Company
Total volume* 853,869,083 6,931,465
Adv. volume* 322,688,932 2,683,177
Decl. volume* 519,776,760 3,965,508
Issues traded
3,062
323
Advances
1,227
133
Declines
1,717
174
Unchanged
118
16
New highs
55
7
New lows
121
6
Closing tick
8
12
Closing Arms†
1.16
1.27
Block trades*
6,504
83
Percentage Losers
Latest Session
Close Net chg % chg
Most Active Stocks
t
U.S. consumer rates
Selected rates
Interest rate
After Hours
% chg
High
116.52
Benchmark
Yields
Treasury
yield
curve
and
Yield toRates
maturity of current bills,
Consumer Rates and Returns to Investor
5-year Treasury
note yield
Net chg
General Electric
CREDIT MARKETS
5-year adjustablerate mortgage
t (ARM)
Last
14,244.1 263.12
SPY
Percentage Gainers...
Latest
% chg
Region/Country Index
Americas
Brazil
Canada
Mexico
Chile
7.4
589.69
Company
NYSE NYSE Amer.
Sources: SIX Financial Information; WSJ Market Data Group
International Stock Indexes
World
Volume, Advancers, Decliners
-0.30
Latest
Close
Low
Dow Jones
Total Stock Market
Barron's 400
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.
High
Industrial Average
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
22763
0.2
.04703 21.262
.1609 6.2141
1.1988 .8342
.003819 261.84
.009810 101.94
.1243 8.0458
.2810 3.5585
.01587 63.008
.1135 8.8134
1.0026 .9974
.2373 4.2133
.0381 26.2610
1.3573 .7368
–0.1
0.1
0.1
1.1
–1.5
–2.0
2.3
9.2
7.7
2.4
11.0
–6.7
–0.4
Middle East/Africa
Bahrain dinar
Egypt pound
Israel shekel
Kuwait dinar
Oman sul rial
Qatar rial
Saudi Arabia riyal
South Africa rand
2.6520 .3771 –0.01
.0567 17.6250 –0.8
.2764 3.6180 4.0
3.3188 .3013 –0.04
2.5972 .3850 0.02
.2746 3.641 –0.2
.2667 3.7501 –0.01
.0794 12.5868 1.8
Close Net Chg % Chg YTD%Chg
WSJ Dollar Index 86.05 –0.30–0.35
Thursday
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.
651.60
1.55
202.10
68.43
2.726
1310.70
0.50
0.50
-0.028
8.10
0.09
Sources: Tullett Prebon, WSJ Market Data Group
0.24
% Chg
YTD
% chg
658.32
532.01
19.09
4.19
0.25 202.97
68.64
0.74
3.63
-1.02
0.62 1362.40
166.50
42.53
2.55
1208.60
14.18
50.33
-14.44
6.87
4.25
13.26
-7.69
0.34
Get real-time U.S. stock quotes and track most-active stocks, new highs/lows and mutual funds. Plus, deeper money-flows data and email delivery of key stock-market data. Available free at WSJMarkets.com
.
THE WALL STREET JOURNAL.
B8 | Friday, May 4, 2018
COMMODITIES
Futures Contracts
Contract
High hilo
Low
Open
Metal & Petroleum Futures
Contract
Open
High hi lo
Low
Settle
Chg
Copper-High (CMX)-25,000 lbs.; $ per lb.
3.0445
3.0940
3.0410
3.0590 0.0115
May
July
3.0635
3.1215
3.0565
3.0805 0.0120
Gold (CMX)-100 troy oz.; $ per troy oz.
1310.70
8.10
May
June
1305.50 1319.00
1305.20 1312.70
7.10
Aug
1312.00 1325.20
1312.00 1319.00
7.20
Oct
1319.30 1330.90
1319.00 1325.10
7.10
Dec
1325.40 1337.30
1325.40 1331.60
7.20
Dec'19
1370.00 1374.20
1370.00 1371.10
7.10
Palladium (NYM) - 50 troy oz.; $ per troy oz.
955.20
967.60
954.90
958.70 –1.45
June
Sept
956.95
963.65
951.45
955.05 –1.15
Dec
942.20
956.65
941.30
951.35 –1.60
Platinum (NYM)-50 troy oz.; $ per troy oz.
898.20
902.80
898.20
901.40 10.00
June
July
896.40
907.60
895.10
904.00 10.20
Silver (CMX)-5,000 troy oz.; $ per troy oz.
16.370
16.530
16.340
16.362 0.071
May
July
16.405
16.620
16.385
16.447 0.072
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl.
67.66
68.60
67.21
68.43
0.50
June
July
67.57
68.43
67.10
68.26
0.49
Aug
67.15
68.00
66.72
67.80
0.45
Sept
66.60
67.44
66.22
67.22
0.40
Dec
65.01
65.79
64.66
65.62
0.44
Dec'19
58.66
59.43
58.65
59.34
0.41
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal.
2.1126
2.1268
2.1011
2.1127 –.0088
June
July
2.1054
2.1204
2.0935
2.1072 –.0068
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal.
2.0712
2.0936
2.0529
2.0875 .0077
June
July
2.0719
2.0929
2.0547
2.0875 .0072
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu.
2.760
2.773
2.700
2.726 –.028
June
July
2.797
2.810
2.739
2.759 –.032
Sept
2.787
2.798
2.730
2.747 –.034
Oct
2.799
2.810
2.742
2.758 –.035
March'19
2.888
2.895
t
2.848
2.860 –.030
April
2.593
2.600
t
2.564
2.575 –.023
Settle
Open
interest
Chg
Corn (CBT)-5,000 bu.; cents per bu.
3,510
133,916
367
328,129
87,386
9,241
61,281
3,669
226.00
236.00
225.75
237.00
.25
1.00
May
July
1032.75
1043.00
1038.75
1055.50
1024.75
1034.00
1043.25
1053.25
10.50
3,561
10.25 431,846
May
July
398.60
399.10
400.00
401.40
395.20
395.50
398.40
398.60
–1.60
2,490
–2.10 260,286
May
July
30.36
30.60
30.62
30.85
30.20
30.38
30.58
30.81
.21
1,507
.21 275,546
May
July
1268.50
1300.50
1268.50
1303.00
1267.00
1296.00
1274.50
1301.50
May
July
525.75
526.00
540.00 s
538.50 s
523.50
520.50
540.50
538.00
14.75
397
11.25 243,006
May
July
539.50
554.25
540.00
568.50 s
539.50
548.50
547.50
567.75
11.75
454
12.50 137,263
May
July
628.50
622.00
628.50
630.75
628.00
617.25
631.25
630.00
.50
5.50
May
Aug
138.575
144.500
141.125
147.075
138.150
143.850
140.800
146.575
2.175
2.125
June
Aug
105.000
104.150
107.575
106.550
104.500
103.700
106.525
105.525
May
June
67.000
73.800
68.125
75.425
67.000
73.425
67.075
73.500
.175
…
2,861
94,775
May
July
592.00
570.10
594.90
576.00
582.90
565.10
583.50 –11.50
566.50 –8.60
849
4,861
June
93.313
3,956
3,567
May
June
98.0800
97.8950
May
June
Dec
Dec'19
97.6475
97.6300
97.3500
97.0050
Cattle-Live (CME)-40,000 lbs.; cents per lb.
Hogs-Lean (CME)-40,000 lbs.; cents per lb.
–1.00
–1.50
15.22
15.67
May
June
15.23
15.70
15.08
15.56
15
6,570
0.8838
1.0142
2.690
2.640
2.690
1.810
1.750
1.900
2.550
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
Metals
Other metals
LBMA Platinum Price PM
*897.0
Platinum,Engelhard industrial
905.0
Platinum,Engelhard fabricated
1005.0
Palladium,Engelhard industrial
976.0
Palladium,Engelhard fabricated
1076.0
Aluminum, LME, $ per metric ton
*2269.0
Copper,Comex spot
3.0590
Iron Ore, 62% Fe CFR China-s
66.8
Shredded Scrap, US Midwest-s,m
381
Steel, HRC USA, FOB Midwest Mill-s
882
Fibers and Textiles
Gold, per troy oz
1317.38
1416.18
1315.05
1459.70
*1310.75
*1304.20
1364.58
1377.71
1377.71
1590.00
1289.12
1377.71
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.
16.5500
19.8600
16.4390
20.5490
*£11.9800
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA spot price
0.5900
0.8350
*93.25
62.000
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
3.7850
136.2
517.5
268
108
315
2.8450
25.75
7.1375
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
Fats and Oils
29.5000
0.2300
n.a.
0.2893
0.2375
0.2900
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
May 3, 2018
Week
Latest ago
U.S. consumer price index
0.23
0.32
249.554
256.610
All items
Core
2.4
2.1
Britain
Australia
—52-WEEK—
High Low
0.50
1.50
0.50
1.50
0.50
1.50
0.25
1.50
2.18
0.76
Discount
Latest
52-Week
High
Low
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
0.00
0.50
Effective rate
High
Low
Bid
Offer
2.25
1.50
1.7200
1.9000
1.6500
1.6800
1.7100
1.7200
1.9500
1.6500
1.6800
1.7100
1.7200
1.9500
1.7100
1.7000
1.7200
0.8600
1.0625
0.7000
0.8200
0.8300
1.650 1.680 1.720 0.695
Largest 100 exchange-traded funds, latest session
ETF
AlerianMLPETF
CnsmrDiscSelSector
CnsStapleSelSector
EnSelectSectorSPDR
FinSelSectorSPDR
FT DJ Internet
HealthCareSelSect
IndSelSectorSPDR
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
FDN
XLV
XLI
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
9.94
102.67
48.98
73.49
26.92
124.69
80.36
71.43
103.58
119.44
66.69
55.96
63.16
264.40
187.05
77.87
60.30
105.79
95.57
73.89
51.47
106.39
50.94
12.59
114.51
85.36
108.54
103.60
71.62
40.73
70.68
65.84
46.22
44.42
60.29
101.28
108.19
136.63
146.31
118.51
191.83
153.81
124.27
155.96
204.74
85.93
216.41
155.71
108.03
–1.09 –7.9
4.0
–0.45
–0.10 –13.9
1.7
–0.23
–0.85 –3.5
0.30 13.5
–0.90 –2.8
0.24 –5.6
0.02 –0.9
0.15 –2.2
0.9
0.30
–0.30 –1.7
0.1
0.14
–0.22 –1.7
–0.15 –1.4
1.4
–0.61
–0.25 –1.4
0.11 –3.2
–0.06 –3.0
1.2
0.29
0.04 –2.5
3.2
0.22
0.2
–0.02
0.6
0.48
0.02 –5.8
–0.01 –2.2
–0.11 –6.5
0.06 –2.8
0.01 –0.7
0.7
–0.85
0.5
0.31
2.1
0.41
–0.22 –1.9
2.4
0.25
0.6
0.10
–1.36 –5.1
0.22 –2.3
1.4
0.03
–0.22 –1.5
–0.48 –4.7
2.7
–0.60
0.9
–0.54
–0.54 –1.2
–0.27 –1.4
–0.17 –1.6
–0.44 –3.6
0.3
0.13
1.9
0.03
–0.49 –5.4
Closing Chg YTD
Symbol Price (%) (%)
iShUSPfdStk
iShShortTreaBd
iShTIPSBondETF
iSh1-3YTreasuryBd
iSh7-10YTreasuryBd
iSh20+YTreasuryBd
iShRussellMCGrowth
PIMCOEnhShMaturity
PwrShQQQ 1
PwrShS&P500EW
PwrShSrLoanPtf
SPDR BlmBarcHYBd
SPDR Gold
SchwabIntEquity
SchwabUS BrdMkt
SchwabUS Div
SchwabUS LC
SchwabUS SC
SPDR DJIA Tr
SPDR S&PMdCpTr
SPDR S&P 500
SPDR S&P Div
TechSelectSector
VanEckGoldMiner
VangdInfoTech
VangdSC Val
VangdSC Grwth
VangdDivApp
VangdFTSEDevMk
VangdFTSE EM
VangdFTSE Europe
VangdFinls
VangdFTSEAWxUS
VangdGrowth
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
TLT
IWP
MINT
QQQ
RSP
BKLN
JNK
GLD
SCHF
SCHB
SCHD
SCHX
SCHA
DIA
MDY
SPY
SDY
XLK
GDX
VGT
VBR
VBK
VIG
VEA
VWO
VGK
VFH
VEU
VUG
VYM
BIV
VCIT
VV
VO
VOE
VNQ
VOO
BSV
VCSH
VB
BND
BNDX
VXUS
VTI
VT
VTV
–.06
–.06 525,916
24.60
25.16
–.21
–.21
84.75
83.83
84.45
84.50
2,814
1,506
–.56
18
–.18 138,810
161.60 s
161.80 s
160.70
158.55
159.65
159.10
–.30
–1.15
27
10,092
Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
142-290
142-060
143-180
142-230
10.0 843,936
10.0
9,553
119-220
119-110
5.5 3,679,034
6.0 29,985
113-170
113-075
3.0 3,675,674
3.2 35,880
106-015
105-267
1.0 2,018,423
1.0 12,175
98.298
98.070
.002 209,133
.010 320,814
Treasury Notes (CBT)-$100,000; pts 32nds of 100%
119-140
119-045
5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100%
113-140
113-070
2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100%
106-002
105-265
30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg.
May
July
98.298
98.060
98.300
98.070
t
98.298
98.060
10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100%
93.359
97.6550
97.6350
97.3650
97.0450
97.6400
97.6250
97.3450
97.0050
Currency Futures
Japanese Yen (CME)-¥12,500,000; $ per 100¥
May
June
.9110
.9128
.9176
.9204
.9107
.9125
.9162
.9181
.0045
316
.0045 159,569
May
June
.7785
.7773
.7804
.7809
.7772
.7752
.7784
.7789
.0001
198
.0002 114,707
May
June
1.3598
1.3597
1.3620
1.3654
t
June
Sept
1.0042
1.0164
1.0079
1.0164
t
t
May
June
July
Aug
Sept
Dec
.7520
.7488
.7521
.7524
.7493
.7543
.7536
.7543
.7538
.7540
.7545
.7543
June
Sept
.05198
.05128
.05240
.05187
May
June
1.1984
1.1994
1.2013
1.2045
Canadian Dollar (CME)-CAD 100,000; $ per CAD
British Pound (CME)-£62,500; $ per £
1.3544
1.3562
1.3575 –.0036
1,013
1.3595 –.0036 186,143
1.0034
1.0123
1.0059 –.0008
1.0142 –.0009
Swiss Franc (CME)-CHF 125,000; $ per CHF
Australian Dollar (CME)-AUD 100,000; $ per AUD
.7494
.7486
.7496
.7498
.7492
.7543
.7531
.7531
.7532
.7534
.7537
.7544
Euro (CME)-€125,000; $ per €
t
87,212
150
.0021
807
.0021 149,883
.0020
557
.0021
206
.0021
1,249
.0022
416
.05172
.05098
.05203 –.00008 212,065
.05130 –.00008
1,338
1.1965
1.1985
1.2000
1.2029
.0005
1,515
.0004 503,581
Index Futures
Mini DJ Industrial Average (CBT)-$5 x index
June
Sept
23820
23760
23940
23950
23467
23490
23910
23923
June
Sept
2630.00
2636.00
2635.70
2591.80
2598.70
2631.80
2635.90
4.40
4.20
June
Sept
2626.75
2630.75
2636.25
2640.00
2591.25
2595.75
2631.75
2636.00
4.25 2,857,898
4.25 91,727
June
1870.10
1879.20
1850.10
1872.30
6630.8
6659.0
6671.5
6692.5
6538.0
6563.3
6664.5
6688.3
t
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
85 102,474
86
2,307
–3.50
75,428
9,027
75,318
31.0 225,883
31.0 10,864
.203
29,270
2,033
787
June
1553.00
1557.50
1531.10
1551.20
–1.00
June
1440.80
1456.40
1438.70
1460.30
–.90
61
June
Sept
92.59
92.15
92.19
91.75
92.25
91.80
–.09
–.09
35,179
1,493
93.250
Eurodollar (CME)-$1,000,000; pts of 100%
Open
interest
98.0700 –.0075
97.8750 –.0075
93.156
98.0800
t 97.8950
Chg
June
Sept
1 Month Libor (CME)-$3,000,000; pts of 100%
98.0800
97.8975
Settle
Mexican Peso (CME)-MXN 500,000; $ per MXN
Interest Rate Futures
97.6450
97.6300
97.3600
97.0350
…
.0050
.0150
.0300
396,210
1,712,668
2,056,211
1,978,665
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
92.60 s
92.15 s
10,216
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
1899.53
-2.3
Total
return
close
YTD total
return (%)
Yield (%)
Latest Low High
Index
Mortgage-Backed Bloomberg Barclays
Broad Market Bloomberg Barclays
3.310 2.380 3.340
U.S. Aggregate
U.S. Corporate Indexes Bloomberg Barclays
1954.17
-1.7
Mortgage-Backed
1920.93
-1.7
Ginnie Mae (GNMA) 3.440 2.630 3.480
3.460 2.660 3.510
2700.75
-3.5
U.S. Corporate
3.960 3.030 3.970
1145.80
-1.7
Fannie mae (FNMA) 3.460 2.670 3.520
2567.50
-2.0
Intermediate
3.650 2.530 3.670
1764.77
-1.8
Freddie Mac (FHLMC) 3.480 2.680 3.530
Long term
4.630 3.990 4.640
516.31
-1.1
Muni Master
2.596 1.736 2.653
552.98
-2.6
Double-A-rated
3.410 2.470 3.430
359.37
-1.7
7-12 year
2.632 1.744 2.702
696.63
-3.4
Triple-B-rated
4.250 3.340 4.250
406.36
-1.4
12-22 year
2.921 2.213 3.004
393.98
-1.6
22-plus year
3.300 2.716 3.411
3675.46 -6.6
High Yield Bonds Merrill Lynch
416.08
-0.4
High Yield Constrained 6.319 5.373 6.417
Global Government J.P. Morgan†
Triple-C-rated
9.877 9.607 11.091
n.a.
n.a.
Global Government
n.a. n.a. n.a.
2844.00
-0.6
High Yield 100
6.063 4.948 6.319
n.a.
n.a.
Canada
n.a. n.a. n.a.
376.88
-0.5
Global High Yield Constrained 5.775 4.934 5.775
n.a.
n.a.
EMU§
n.a. n.a. n.a.
Europe High Yield Constrained 2.884 1.897 2.957
n.a.
n.a.
France
n.a. n.a. n.a.
n.a.
n.a.
Germany
n.a. n.a. n.a.
1.6
426.91
0.1
306.71
U.S Agency Bloomberg Barclays
1618.95
-1.1
U.S Agency
2.770 1.690 2.800
n.a.
n.a.
Japan
n.a. n.a. n.a.
1453.00
-0.6
10-20 years
2.650 1.510 2.690
n.a.
n.a.
Netherlands
n.a. n.a. n.a.
n.a.
U.K.
n.a. n.a. n.a.
3251.93
-4.0
20-plus years
3.400 2.730 3.460
n.a.
2402.92
-2.4
Yankee
3.630 2.610 3.640
772.95
-4.3
Emerging Markets ** 6.460 5.279 6.460
*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
36.97
110.25
112.07
83.22
101.63
118.81
121.64
101.43
161.80
98.73
23.11
35.69
124.28
34.13
63.67
47.61
62.87
69.65
239.10
340.59
262.62
89.77
66.36
22.65
173.61
129.58
164.91
98.53
44.80
44.98
59.35
68.11
54.45
142.65
81.63
80.56
83.30
120.74
152.91
108.39
76.45
241.21
78.04
78.05
147.47
78.83
54.64
56.65
135.38
73.59
101.99
0.11
...
0.13
0.07
0.26
0.45
0.23
...
–0.01
–0.33
0.04
–0.03
0.51
0.21
–0.27
–0.25
–0.21
–0.49
–0.00
–0.14
–0.22
–0.47
0.23
1.21
0.31
–0.44
–0.16
–0.23
0.20
–0.31
0.41
–0.71
0.15
–0.02
–0.02
0.14
–0.04
–0.21
–0.13
–0.45
–0.07
–0.24
0.03
0.09
–0.30
0.09
0.18
0.21
–0.27
–0.04
–0.38
–2.9
0.0
–1.8
–0.8
–3.7
–6.3
0.8
–0.1
3.9
–2.3
0.3
–2.8
0.5
0.2
–1.3
–7.0
–1.4
–0.1
–3.3
–1.4
–1.6
–5.0
3.8
–2.5
5.4
–2.4
2.5
–3.4
–0.1
–2.0
0.3
–2.8
–0.5
1.4
–4.7
–3.9
–4.7
–1.5
–1.2
–2.9
–7.9
–1.7
–1.3
–1.6
–0.2
–3.4
0.5
–0.3
–1.4
–0.9
–4.1
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
4.500
Australia 2
10
0.000
30-year mortgage yields
0.500
4.176 4.222 4.275 3.253
4.205 4.251 4.304 3.281
30 days
60 days
Week
ago
Latest
0.050
2.000
0.100
52-Week
high
low
1.400
Call money
3.50
3.50
3.50
2.75
2.22
2.23
90 days
2.31
1.04
0
1
l
2.059 s
2.820 s
l
l
l
Germany 2 -0.581 t
10 0.534 t
l
l
Italy 2 -0.326 t
10 1.741 t
Japan 2 -0.134
10
U.K. 2
4.250
10
l
l
l
l
0.046
l
Spain 2 -0.344 s
10 1.252 t
2.000
Yield (%)
3 4 Previous
2
l
France 2 -0.509 t
10 0.756 t
0.100
1.400
Latest(l)-2 -1
U.S. 2 2.484 t
10 2.947 t
2.250
0.750
Commercial paper (AA financial)
Exchange-Traded Portfolios | WSJ.com/ETFresearch
ETF
160.70
160.00
0.000
l
l
0.760 t
1.393 t
l
l
Month ago
Year ago
2.488
2.969
2.286
2.780
1.298
2.320
2.059
2.047
1.678
2.807
2.617
2.601
-0.491
-0.489
0.804
0.731
-0.577
-0.594
0.583
Spread Under/Over U.S. Treasurys, in basis points
Latest
Prev
Year ago
-43.0
-42.5
38.0
-12.8
-16.2
28.1
-0.456 -299.3
0.808
-219.1
-297.9
-175.4
-216.5
-151.2
-306.6
-202.1
0.502
-0.723 -306.5
0.327
-241.3
-238.6
-199.3
-0.307
-0.319
-0.096
-279.5
-139.4
1.788
1.789
2.266
-0.134
-0.142
-0.201
-281.0
-120.7
-261.9
-118.1
-5.5
-262.3
-149.9
0.046
0.025
0.020
-290.2
-292.3
-230.1
-0.348
-0.352
-0.279
-282.8
-283.6
-157.7
1.296
1.184
1.612
-169.6
-167.3
-70.8
0.830
0.840
0.074
-172.4
-165.9
-122.4
1.459
1.359
1.075
-155.5
-151.0
-124.5
Source: Tullett Prebon
Corporate Debt
Libor
Thursday, May 3, 2018
Closing Chg YTD
Symbol Price (%) (%)
May
July
Fannie Mae
Other short-term rates
Treasury bill auction
4 weeks
1.835 1.830 1.835 0.845
1.990 1.985 1.990 0.975
13 weeks
26 weeks
Federal funds
Prime rates
U.S.
Canada
Japan
2.25
2.25
—52-WEEK—
High Low
Secondary market
1.78
1.76
U.S. government rates
International rates
Week
ago
Week
Latest ago
Overnight repurchase
U.S.
Contract
High hilo
Low
Open
Global Government Bonds: Mapping Yields
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.
Chg From (%)
Feb. '18March '17
11.69
11.69
Orange Juice (ICE-US)-15,000 lbs.; cents per lb.
106-007 106-025
105-265 105-275
201.24
184.96
1.0906
2.3525
160.25
166.50
83.75
3066
1.2346
1.4368
1.1650
17.00
n.a.
62.02
n.a.
0.9641
n.a.
168.88
.60
145
.60 139,408
24.50
25.30
84.85
85.12
June
Sept
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
Borrowing Benchmarks | WSJ.com/bonds
Money Rates
March index
level
84.75
84.70
1.675 136,703
1.550 101,089
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 5/2
Source: WSJ Market Data Group
Inflation
May
July
113-147 113-202
113-080 113-105
Food
122.20
124.35
Cotton (ICE-US)-50,000 lbs.; cents per lb.
June
Sept
Thursday
28
55
28 139,020
…
11.60
t
24.80
25.30
6,717
23,304
SoybeanMeal,Cent IL,rail,ton48%-u 408.10
Soybeans,No.1 yllw IL-bp,u
10.1250
Wheat,Spring14%-pro Mnpls-u
7.9750
Wheat,No.2 soft red,St.Louis-bp,u
5.3500
Wheat - Hard - KC (USDA) $ per bu-u 5.4875
Wheat,No.1soft white,Portld,OR-u
5.9963
2,863
2,841
Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb.
119-165 119-265
119-045 119-155
–.11
–.09
122.45
123.65
… s
11.78
June
Sept
Thursday
*16.3500
12124
(U.S.$ equivalent)
Coins,wholesale $1,000 face-a
Open
interest
Chg
Sugar-World (ICE-US)-112,000 lbs.; cents per lb.
56
32,248
15.12
15.59
2,821
2,778
122.45
125.40
143-030 143-300
142-100 143-030
Thursday, May 03, 2018
These prices reflect buying and selling of a variety of actual or “physical” commodities in the marketplace—
separate from the futures price on an exchange, which reflects what the commodity might be worth in future
months.
Thursday
2,822
2,847
June
Sept
Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft.
Milk (CME)-200,000 lbs., cents per lb.
3
4,787
Cash Prices | WSJ.com/commodities
Energy
24.80
25.30
226.00
237.50
Cattle-Feeder (CME)-50,000 lbs.; cents per lb.
268,771
199,159
136,625
123,036
88,232
89,776
July
Sept
226.00
236.00
Wheat (MPLS)-5,000 bu.; cents per bu.
161,215
91,272
…
11.70
May
July
Wheat (KC)-5,000 bu.; cents per bu.
140,418
90,770
June
July
3.50
4,303
3.00 835,780
Wheat (CBT)-5,000 bu.; cents per bu.
516,664
289,723
161,720
239,502
295,785
156,382
122.45
123.75
399.50
408.00
Rough Rice (CBT)-2,000 cwt.; $ per cwt.
Settle
Coffee (ICE-US)-37,500 lbs.; cents per lb.
395.00
403.25
Soybean Oil (CBT)-60,000 lbs.; cents per lb.
1,128
141,535
May
July
399.50 s
408.25 s
Soybean Meal (CBT)-100 tons; $ per ton.
45
75,779
2,821
2,796
396.00
404.75
Soybeans (CBT)-5,000 bu.; cents per bu.
17,052
5,721
263
May
July
May
July
Oats (CBT)-5,000 bu.; cents per bu.
Contract
High hilo
Low
Open
Cocoa (ICE-US)-10 metric tons; $ per ton.
Agriculture Futures
Open
interest
WSJ.com/commodities
One month
Three month
Six month
One year
1.92270
2.36313
2.51488
2.77273
1.90076
2.35878
2.52175
2.76993
1.92270
2.36561
2.52175
2.78031
0.98856
1.17172
1.39906
1.69511
-0.402
-0.354
-0.314
-0.243
-0.402
-0.364
-0.319
-0.244
-0.397
-0.354
-0.269
-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)
-0.372
-0.328
-0.269
-0.189
One month
Three month
Six month
One year
Latest
-0.372
-0.328
-0.269
-0.189
Value
Traded
-0.366
-0.325
-0.248
-0.123
-0.374
-0.332
-0.279
-0.194
52-Week
High
Low
DTCC GCF Repo Index
1.777 25.100 2.068 0.791
1.805 130.970 1.971 0.794
Treasury
MBS
Open Implied
Settle Change Interest Rate
DTCC GCF Repo Index Futures
Treasury May
Treasury Jun
Treasury Jly
98.203 0.002 1159 1.798
98.050 unch. 675 1.950
97.940 unch. 439 2.060
Weekly survey
Latest
Week ago Year ago
Freddie Mac
30-year fixed
15-year fixed
Five-year ARM
4.55
4.03
3.69
4.58
4.02
3.74
4.02
3.27
3.13
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.
in that same company’s share price.
Investment-grade spreads that tightened the most…
Issuer
Symbol Coupon (%)
Societe Generale S.A.
Barclays
Citigroup
Anheuser–Busch Inbev Finance
SOCGEN
BACR
C
ABIBB
4.250 April 14, ’25
4.375 Sept. 11, ’24
5.875 March 27, ’49
3.700
Feb. 1, ’24
Bank of America
Apple
Canadian Imperial Bank of Commerce
VMware
BAC
AAPL
CM
VMW
3.300
3.200
2.100
2.300
Maturity
Jan. 11, ’23
May 11, ’27
Oct. 5, ’20
Aug. 21, ’20
Current
149
188
108
73
Spread*, in basis points
One-day change
–18
–16
–13
–11
71
63
55
90
–8
–7
–7
–7
Last week
Stock Performance
Close ($)
% chg
n.a.
202
102
82
...
...
67.94
...
...
...
–0.07
...
78
72
n.a.
104
29.20
176.89
87.18
132.87
–1.28
0.18
0.22
0.29
…And spreads that widened the most
HSBC Holdings
Credit Suisse AG*
Berkshire Hathaway
Energy Transfer Partners
HSBC
CS
BRK
ETP
6.250 March 23, ’49
7.500 Dec. 11, ’49
2.750 March 15, ’23
6.625 Oct. 15, ’36
290
281
50
275
23
22
20
20
263
249
53
n.a.
49.84
16.52
...
17.66
–0.24
–0.54
...
–2.21
Cardinal Health
Deutsche Bank AG
Monsanto
Transcanada Pipelines
CAH
DB
MON
TRPCN
4.368
7.500
4.200
6.200
192
443
150
177
18
18
18
18
n.a.
410
n.a.
n.a.
50.80
13.63
125.10
...
–21.42
...
–0.08
...
June 15, ’47
April 30, ’49
July 15, ’34
Oct. 15, ’37
High-yield issues with the biggest price increases…
Issuer
Symbol
Continental Resources
Teva Pharma III
CONSOL Energy
Genworth Financial
CLR
4.900
TEVA
6.750
CNSOLM 11.000
GNW
6.500
Diebold Nixdorf
Icahn Enterprises
Treehouse Foods
Beazer Homes USA
DBD
IEP
THS
BZH
Coupon (%)
Maturity
Bond Price as % of face value
Current
One-day change
June 1, ’44
March 1, ’28
Nov. 15, ’25
June 15, ’34
99.625
100.850
107.000
77.500
8.500 April 15, ’24
5.875
Feb. 1, ’22
6.000 Feb. 15, ’24
6.750 March 15, ’25
101.500
101.250
99.625
99.000
2.75
1.85
1.75
1.50
1.25
1.13
1.13
0.75
Last week
Stock Performance
Close ($)
% chg
96.125
n.a.
105.500
n.a.
63.98
…
...
2.91
–2.93
…
...
–2.02
103.900
100.883
99.750
n.a.
12.05
66.66
39.83
16.11
–6.59
–0.95
8.77
4.34
56.000
71.250
68.000
106.250
...
...
2.43
...
...
...
–5.45
...
63.500
88.580
101.750
72.750
...
284.45
...
3.16
...
–5.55
...
–5.11
…And with the biggest price decreases
PetSmart
EP Energy
Ultra Resources
Ardagh Packaging Finance
PETM
EPENEG
UPL
ARGID
8.875
8.000
7.125
7.250
June 1, ’25
Feb. 15, ’25
April 15, ’25
May 15, ’24
54.250
68.000
66.250
104.250
Intelsat Luxembourg S.A.
Tesla
Algeco Global Finance 2
Sanchez Energy
INTEL
8.125
TSLA
5.300
ALGSCO 10.000
SN
6.125
June 1, ’23
Aug. 15, ’25
Aug. 15, ’23
Jan. 15, ’23
63.500
87.750
100.000
71.000
–3.25
–2.50
–1.63
–1.50
–1.50
–1.38
–1.25
–1.25
*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.
Friday, May 4, 2018 | B9
BIGGEST 1,000 STOCKS
WSJ.com/stocks
How to Read the Stock Tables
The following explanations apply to NYSE,
NYSE Arca, NYSE American and Nasdaq Stock
Market listed securities. Prices are composite
quotations that include primary market trades
as well as trades reported by Nasdaq BX
(formerly Boston), Chicago Stock Exchange,
Cboe, NYSE National and Nasdaq ISE.
The list comprises the 1,000 largest
companies based on market capitalization.
Underlined quotations are those stocks with
large changes in volume compared with the
issue’s average trading volume.
Boldfaced quotations highlight those issues
whose price changed by 5% or more if their
previous closing price was $2 or higher.
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.
Thursday, May 3, 2018
Stock
Net
Sym Close Chg
A B C
ABB
ABB 23.31 -0.07
ADT
ADT 8.28 -0.42
AES
AES 12.30 0.11
Aflac
AFL 44.45 -0.60
AGNC Invt AGNC 18.83 0.09
ANGI Homesvcs ANGI 13.31 -0.12
Ansys
ANSS 161.02 0.41
ASML
ASML 192.75 2.41
t AT&T
T
31.94 -0.12
AbbottLabs ABT 57.93 0.08
AbbVie
ABBV 100.28 -0.09
s Abiomed
ABMD 335.57 33.43
Accenture ACN 151.73 1.02
ActivisionBliz ATVI 66.82 -1.57
t Adient
ADNT 55.84 -6.14
AdobeSystems ADBE 226.05 4.95
AdvanceAuto AAP 115.43 -0.47
AdvMicroDevices AMD 10.93 -0.04
Aegon
AEG 6.91 -0.18
AerCap
AER 53.63 1.30
Aetna
AET 172.13 -4.62
AffiliatedMgrs AMG 160.07 -1.02
AgilentTechs A
66.34 0.43
AgnicoEagle AEM 42.51 0.44
AirProducts APD 160.43 -1.26
AkamaiTech AKAM 71.45 -0.20
AlaskaAir ALK 62.92 -0.47
Albemarle ALB 97.89 0.05
Alcoa
AA 53.28 0.21
AlexandriaRlEst ARE 126.73 -0.84
AlexionPharm ALXN 113.86 -0.38
Alibaba
BABA 182.45 1.00
AlignTech ALGN 255.14 5.67
Alkermes ALKS 43.31 -0.67
Alleghany Y
566.62 -5.70
t Allegion
ALLE 74.82 -0.30
Allergan
AGN 147.60 -3.47
t AllianceData ADS 194.64 -4.61
AlliantEnergy LNT 43.23 0.36
Allstate
ALL 94.05 -0.01
AllyFinancial ALLY 26.00 -0.48
AlnylamPharm ALNY 88.31 -1.71
Alphabet C GOOG 1023.72 -0.66
Alphabet A GOOGL 1026.30 0.25
Altaba
AABA 70.38 0.17
t AlticeUSA ATUS 16.83 -0.31
Altria
MO 56.36 0.67
AlumofChina ACH 13.75 -0.22
Amazon.com AMZN 1572.08 2.39
Ambev
ABEV 6.34 -0.01
Amdocs
DOX 65.69 -1.02
Amerco
UHAL 333.22 -2.92
Ameren
AEE 58.74 0.36
AmericaMovil AMX 17.91 -0.15
AmericaMovil A AMOV 17.80 -0.09
AmerAirlines AAL 42.11 -0.13
AEP
AEP 69.24 0.05
AmerExpress AXP 97.14 -0.49
AmericanFin AFG 108.82 -2.48
AmHomes4Rent AMH 20.23
...
t AIG
AIG 51.94 -2.90
AmerTowerREIT AMT 137.58 1.11
AmerWaterWorks AWK 85.29 -0.94
Ameriprise AMP 131.49 -1.50
AmerisourceBrgn ABC 85.37 -6.81
Ametek
AME 69.99 -0.16
Amgen
AMGN 166.39 -3.04
Amphenol APH 84.28 0.32
AnadarkoPetrol APC 66.03 0.46
AnalogDevices ADI 87.91 -0.39
Andeavor ANDV 141.56 2.98
t AndeavorLog ANDX 41.40 -1.37
AB InBev BUD 96.62 1.94
t AnnalyCap NLY 10.21 -0.07
AnteroResources AR 18.38 -0.70
Anthem
ANTM 230.77 1.59
Aon
AON 140.00 0.21
Apache
APA 38.54 -2.52
ApartmtInv AIV 40.66 -0.04
ApolloGlbMgmt APO 30.67 1.03
Apple
AAPL 176.89 0.32
ApplMaterials AMAT 50.71 0.18
Aptargroup ATR 91.12 -1.44
Aptiv
APTV 91.12 1.09
AquaAmerica WTR 35.18 -0.05
Aramark
ARMK 36.61 -0.36
ArcelorMittal MT 33.88 0.18
t ArchCapital ACGL 77.95 -0.98
ArcherDaniels ADM 43.60 -0.83
t Arconic
ARNC 16.93 -0.38
AristaNetworks ANET 267.85 2.39
ArrowElec ARW 73.65 -1.75
AspenTech AZPN 88.74 1.32
AstraZeneca AZN 35.82 0.28
Athene
ATH 47.56 -0.93
Atlassian
TEAM 58.49 2.02
AtmosEnergy ATO 88.06 1.09
Autodesk ADSK 127.60 2.34
Autohome ATHM 93.74 -1.32
Autoliv
ALV 138.58 0.88
ADP
ADP 123.10 1.04
AutoZone AZO 636.85 6.67
Avalonbay AVB 162.85 0.23
s Avangrid
AGR 53.75 0.35
AveryDennison AVY 104.22 0.07
s AveXis
AVXS 217.16 0.49
AxaltaCoating AXTA 30.74 -0.35
BB&T
BBT 52.45 -0.41
t BCE
BCE 41.39 -0.54
BHPBilliton BHP 47.65 0.70
BHPBilliton BBL 42.71 0.64
BOK Fin
BOKF 99.98 -0.70
BP
BP 44.73 0.03
BRF
BRFS 6.96
...
BT Group BT 15.97 -0.62
BWX Tech BWXT 66.31 -0.21
Baidu
BIDU 252.46 2.66
BakerHughes BHGE 35.60
...
Ball
BLL 37.92 -0.58
BancoBilbaoViz BBVA 7.97 -0.06
BancodeChile BCH 97.07 -0.94
BancoMacro BMA 89.67 -3.04
BcoSantChile BSAC 32.42 -0.19
BcoSantMex BSMX 7.16 -0.19
BancoSantander SAN 6.39 -0.06
BanColombia CIB 47.92 0.67
BankofAmerica BAC 29.20 -0.38
BankofMontreal BMO 75.74 -0.23
BankNY Mellon BK 53.85 -0.14
BkNovaScotia BNS 61.22 -0.20
BankofOzarks OZRK 46.52 -0.73
Barclays
BCS 11.24 -0.11
BarrickGold ABX 13.48 0.11
Stock
Net
Sym Close Chg
BaxterIntl BAX 69.76 -0.67
BectonDicknsn BDX 227.13 -3.06
BeiGene
BGNE 184.20 2.91
Berkley
WRB 73.82 -0.11
BerkHathwy A BRK.A 287051-3399.00
BerkHathwy B BRK.B 191.61 -1.70
t BerryGlobal BERY 49.64 -4.12
BestBuy
BBY 75.01 -0.86
Bio-RadLab A BIO 250.83 -1.76
Biogen
BIIB 266.44 -7.69
BioMarinPharm BMRN 82.30 -0.07
BlackKnight BKI 49.40 0.55
BlackBerry BB 10.71 -0.14
BlackRock BLK 511.67 -3.12
Blackstone BX 31.06 0.12
bluebirdbio BLUE 169.60 -2.90
Boeing
BA 330.69 6.50
BookingHldgs BKNG 2152.21 2.39
BoozAllen BAH 39.27 0.05
BorgWarner BWA 47.84 -0.60
BostonProps BXP 121.82 1.01
BostonSci BSX 29.43 0.16
Braskem
BAK 24.12 -0.47
BrightHorizons BFAM 96.72 0.22
t BrighthouseFin BHF 48.06 -0.14
Bristol-Myers BMY 51.45 -0.05
BritishAmTob BTI 52.58 -0.38
Broadcom AVGO225.25 -3.49
BroadridgeFinl BR 107.81 0.42
BrookfieldMgt BAM 39.47 0.39
BrookfieldInfr BIP 39.94 0.37
Brown&Brown BRO 27.08 0.17
Brown-Forman B BF.B 55.26 1.52
Brown-Forman A BF.A 52.65 1.60
BuckeyePtrs BPL 41.41 -0.29
Bunge
BG 70.27 -3.02
BurlingtonStrs BURL 137.48 1.43
CA
CA 34.06 0.10
CBD Pao
CBD 21.87 -0.02
CBRE Group CBRE 45.96 -0.33
t CBS B
CBS 48.74 -0.25
t CBS A
CBS.A 48.87 -0.19
CDK Global CDK 64.12 -0.26
CDW
CDW 74.50 -1.56
CF Industries CF 38.27 -0.80
CGI Group GIB 59.65 0.49
CH Robinson CHRW 82.60 -0.30
CIT Group CIT 52.12 -0.39
CME Group CME 157.02 0.64
CMS Energy CMS 46.47 -0.03
CNA Fin
CNA 48.43 -0.45
CNOOC
CEO 168.09 -0.15
CPFLEnergia CPL 13.10 -0.32
CRH
CRH 35.86 0.22
CSX
CSX 59.09 -0.29
CVS Health CVS 62.27 -3.67
CabotOil
COG 23.08 -0.73
CadenceDesign CDNS 40.25 0.28
CaesarsEnt CZR 11.70 0.20
CamdenProperty CPT 85.02 -0.90
CampbellSoup CPB 40.40 0.45
CIBC
CM 87.18 0.19
CanNtlRlwy CNI 76.57 0.43
CanNaturalRes CNQ 35.40 -0.67
CanPacRlwy CP 178.50 1.47
Canon
CAJ 34.18 -0.01
CapitalOne COF 87.92 -1.26
t CardinalHealth CAH 50.80-13.85
Carlisle
CSL 106.25 -0.60
Carlyle
CG 20.95 0.45
CarMax
KMX 63.32 -0.20
Carnival
CCL 63.30 0.45
Carnival
CUK 64.70 0.38
Caterpillar CAT 143.78 -0.08
CboeGlobalMkts CBOE 105.45 -1.34
Celanese A CE 106.31 -0.77
Celgene
CELG 85.40 -1.50
t Cemex
CX
5.94 -0.02
CenovusEnergy CVE 10.10 -0.08
s Centene
CNC 115.01 0.77
CenterPointEner CNP 25.38 -0.08
CentraisElBras EBR 5.61 -0.10
CenturyLink CTL 18.07 -0.42
t Cerner
CERN 55.09 -2.85
CharterComms CHTR 271.36 -3.42
CheckPoint CHKP 97.61 0.67
Chemours CC 48.51 0.04
CheniereEnergy LNG 58.98 -0.74
CheniereEnerPtrs CQP 31.04 -0.21
CheniereEnHldgs CQH 28.24 -0.22
Chevron
CVX 126.01 0.52
ChinaEastrnAir CEA 41.64 0.76
ChinaLifeIns LFC 13.94 -0.07
ChinaLodging HTHT 136.24 -1.89
ChinaMobile CHL 47.06 -0.32
ChinaPetrol SNP 97.78 0.62
ChinaSoAirlines ZNH 56.82 2.62
ChinaTelecom CHA 47.91 -0.18
ChinaUnicom CHU 13.89 -0.02
Chipotle
CMG 419.42 -1.80
t Chubb
CB 130.19 -2.53
ChunghwaTel CHT 37.53 0.01
Church&Dwight CHD 47.55 1.68
Cigna
CI 172.88 0.52
CimarexEnergy XEC 96.33 -2.18
t CincinnatiFin CINF 69.35 -0.36
Cintas
CTAS 173.01 2.15
CiscoSystems CSCO 44.44 0.58
Citigroup
C
67.94 -0.05
CitizensFin CFG 40.41 -0.60
CitrixSystems CTXS 104.81 0.40
Clorox
CLX 118.49 2.49
t Coca-Cola KO 41.89 -0.17
Coca-Cola Euro CCE 38.13 -0.18
t Coca-Cola Femsa KOF 61.72 -0.45
Cognex
CGNX 46.13 1.07
CognizantTech CTSH 81.36 -0.02
t ColgatePalm CL 63.32 0.18
ColumbiaSportswr COLM 81.03 -1.19
t Comcast A CMCSA 31.01 -0.29
Comerica
CMA 92.98 -1.32
CommerceBcshrs CBSH 63.16 -0.44
SABESP
SBS 9.61 -0.13
ConagraBrands CAG 35.82 -0.12
ConchoRscs CXO 152.00 -5.66
ConocoPhillips COP 65.99 0.54
ConEd
ED 79.00 -0.25
ConstBrands A STZ 224.07 -2.73
ContinentalRscs CLR 63.98 -1.93
Cooper
COO 225.28 -1.57
Copart
CPRT 52.28 0.48
t Corning
GLW 26.57 -0.13
CoStar
CSGP 373.27 4.97
Costco
COST 193.01 -0.99
Coty
COTY 15.94 -0.26
Credicorp
BAP 223.15 -6.56
CreditAcceptance CACC 322.40 -7.35
Mutual Funds
Net
Sym Close Chg
Stock
CreditSuisse CS 16.52
CrownCastle CCI 101.57
t CrownHoldings CCK 45.44
Ctrip.com CTRP 41.38
Cullen/Frost CFR 113.79
t Cummins
CMI 143.55
CurtissWright CW 125.07
D E F
-0.09
0.75
-2.00
0.04
-1.37
-2.57
-1.42
Stock
Genpact
G
32.10 0.43
Gentex
GNTX 22.87 0.03
GenuineParts GPC 88.62 0.68
Gerdau
GGB 4.61 0.07
Gildan
GIL 30.10 1.21
GileadSciences GILD 65.19 -1.69
GSK
GSK 39.60 0.09
GlobalPayments GPN 113.35 0.78
GoDaddy
GDDY 65.05 0.50
Goldcorp
GG 13.49 0.12
GoldmanSachs GS 233.41 -0.64
t Goodyear GT 25.08 -0.25
Graco
GGG 44.58 0.49
Grainger
GWW 279.84 -1.06
GreatPlainsEner GXP 32.71 0.37
Grifols
GRFS 20.69 0.37
GrubHub
GRUB 96.79 1.23
GpoAeroportuar PAC 99.76 -1.88
GpoAvalAcc AVAL 8.67 -0.15
GpoFinGalicia GGAL 52.34 -5.02
GrupoTelevisa TV 17.28 -0.26
Guidewire GWRE 87.04 1.26
HCA Healthcare HCA 95.84 -1.90
HCP
HCP 23.53 0.09
HDFC Bank HDB 97.20 0.24
HD Supply HDS 38.12 -0.33
HP
HPQ 21.32 -0.23
HSBC
HSBC 49.84 -0.12
Halliburton HAL 52.31 -0.33
t Hanesbrands HBI 16.51 -0.77
t HarleyDavidson HOG 40.02 -0.20
Harris
HRS 147.30 0.54
HartfordFinl HIG 51.79 -0.50
Hasbro
HAS 86.11 -0.52
Heico A
HEI.A 71.40 0.45
Heico
HEI 87.00 0.28
Helm&Payne HP 69.14 0.21
HenrySchein HSIC 75.02 -1.57
t Hershey
HSY 89.70 0.16
Hess
HES 57.79 0.18
HewlettPackard HPE 16.90 -0.22
Hexcel
HXL 65.82 0.20
Hill-Rom
HRC 85.83 0.41
Hilton
HLT 79.87 0.42
s HollyFrontier HFC 65.63 1.15
t Hologic
HOLX 36.91 -2.73
HomeDepot HD 183.19 -2.72
HondaMotor HMC 33.26 0.08
Honeywell HON 143.36 0.38
HormelFoods HRL 35.27 -0.10
DR Horton DHI 44.39 0.78
HostHotels HST 19.43
...
HuanengPower HNP 26.89 0.38
Hubbell
HUBB 102.64 -0.24
Humana
HUM 286.68 -0.99
JBHunt
JBHT 116.59 0.43
HuntingtonBcshs HBAN 14.46 -0.20
HuntingIngalls HII 207.33-24.43
Huntsman HUN 29.12 -0.09
HyattHotels H
78.01 2.38
IAC/InterActive IAC 133.13 2.50
ICICI Bank IBN 8.36
...
IdexxLab
IDXX 195.78 2.61
IHSMarkit INFO 48.60 -0.64
t ING Groep ING 16.61 -0.18
t Invesco
IVZ 27.96 -0.18
IPG Photonics IPGP 229.86 3.43
IQVIA
IQV 97.30 0.39
IcahnEnterprises IEP 66.66 -0.64
Icon
ICLR 118.11 0.85
IDEX
IEX 132.58 -0.29
IllinoisToolWks ITW 144.29 1.18
Illumina
ILMN 239.93 -0.57
ImperialOil IMO 30.65 -0.38
t Incyte
INCY 62.39 1.34
Infosys
INFY 17.68 -0.09
Ingersoll-Rand IR
85.97 0.75
t Ingredion
INGR115.67 -2.79
Intel
INTC 52.28 -0.03
InteractiveBrkrs IBKR 73.34 -0.23
ICE
ICE 70.14 -2.24
InterContinentl IHG 63.45 0.51
IBM
IBM 141.99 -0.46
IntlFlavors IFF 140.08 -0.02
IntlGameTech IGT 27.66 -0.20
IntlPaper
IP
51.17 0.99
Interpublic IPG 23.16 0.23
Intuit
INTU 186.38 0.45
IntuitiveSurgical ISRG 448.24 -0.77
InvitatHomes INVH 23.18 -0.08
iQIYI
IQ
16.39 -0.91
IronMountain IRM 34.30 0.30
IsraelChemicals ICL
4.56 -0.02
ItauUnibanco ITUB 13.56 -0.20
J K L
American Century Inv
45.39
Ultra
American Funds Cl A
AmcpA p
32.68
39.57
AMutlA p
26.67
BalA p
12.51
BondA p
60.37
CapIBA p
51.52
CapWGrA
56.69
EupacA p
61.52
FdInvA p
51.51
GwthA p
10.16
HI TrA p
39.74
ICAA p
IncoA p
22.64
44.19
N PerA p
NEcoA p
47.28
66.82
NwWrldA
SmCpA p
56.81
12.78
TxExA p
WshA p
44.83
Baird Funds
AggBdInst
10.53
10.87
CorBdInst
BlackRock Funds A
-0.01
-0.08
-0.03
-0.04
+0.01
-0.02
-0.05
-0.03
-0.11
-0.17
-0.02
-0.13
+0.01
-0.08
-0.10
-0.16
+0.01
+0.03
-0.05
+0.01
...
EliLilly
LLY 78.04
LincolnNational LNC 66.43
LiveNationEnt LYV 40.43
LloydsBanking LYG 3.52
LockheedMartin LMT 309.93
Loews
L
50.44
LogitechIntl LOGI 39.99
LogMeIn
LOGM 112.05
Lowe's
LOW 82.83
lululemon LULU 99.86
LyondellBasell LYB 103.95
M N
Net
Sym Close Chg
Stock
-0.79 PioneerNatRscs PXD 192.14 -4.19
-1.29 PlainsAllAmPipe PAA 23.74 0.19
0.32 PlainsGP
PAGP 24.39 0.17
0.03 PolarisIndustries PII 107.73 0.67
4.23 Pool
POOL 141.52 2.89
-0.65 Praxair
PX 152.84 1.60
3.25 t PrincipalFin PFG 55.84 -0.96
0.80 Procter&Gamble PG 71.36 0.42
-1.13 Progressive PGR 59.27 0.29
0.12 Prologis
PLD 64.80 0.05
-0.80 Proofpoint PFPT 119.96 0.64
t PrudentialFin PRU 97.60 -3.63
Prudential PUK 51.31 0.28
... PublicServiceEnt PEG 51.87 0.41
0.06 PublicStorage PSA 205.91 1.22
-0.30 PulteGroup PHM 30.89 0.33
QGEN 34.26 1.86
-0.73 Qiagen
QRVO 76.73 2.49
-1.24 Qorvo
Qualcomm
QCOM
50.31 0.05
0.53
0.76 QuestDiag DGX 100.94 -0.42
0.11 QurateQVC A QRTEA 23.57 -0.01
8.83 QurateQVC B QRTEB 23.98 0.35
M&T Bank MTB 179.59
MGM Resorts MGM 31.28
MKS Instrum MKSI 106.80
MPLX
MPLX 35.19
MSCI
MSCI 149.20
Macerich
MAC 58.10
Mack-Cali CLI 18.10
Macy's
M
31.45
MadisonSquGarden MSG 246.79
MagellanMid MMP 66.16 -0.57
MagnaIntl MGA 59.09 -0.74
t Manpower MAN 94.98 -1.33
ManulifeFin MFC 18.52 0.34
MarathonOil MRO 19.44 1.14
MarathonPetrol MPC 77.46 1.62
Markel
MKL 1108.77-24.26
MarketAxess MKTX 199.00 -3.02
Marriott
MAR 134.64 0.48
Marsh&McLen MMC 80.63 0.81
MartinMarietta MLM202.41 5.52
MarvellTech MRVL 20.80 0.24
Masco
MAS 38.01 0.28
Mastercard MA 186.48 0.66
MatchGroup MTCH 36.27 1.69
MaximIntProducts MXIM 55.32 0.50
McCormick MKC 101.03 -0.59
McDonalds MCD 160.08 -0.60
McKesson MCK 146.59 -8.04
Medtronic MDT 79.58 -0.34
MelcoResorts MLCO 31.90 -0.06
MercadoLibre MELI 330.59 -2.66
Merck
MRK 57.53 0.23
MetLife
MET 44.66 -0.39
MettlerToledo MTD 574.80 13.97
MichaelKors KORS 61.42 -4.05
MicroFocus MFGP 17.05 -0.07
MicrochipTech MCHP 86.11 1.33
MicronTech MU 46.62 0.73
Microsemi MSCC 65.68 0.76
Microsoft MSFT 94.07 0.56
MidAmApt MAA 91.77 -0.25
Middleby
MIDD 124.84 -1.15
MitsubishiUFJ MUFG 6.47 -0.04
MizuhoFin MFG 3.59 -0.01
MobileTeleSys MBT 10.19 0.08
MohawkInds MHK 215.42 3.11
t MolsonCoors B TAP 59.40 -1.24
Momo
MOMO 35.08 -0.35
Mondelez MDLZ 37.57 -0.32
Monsanto MON 125.10 -0.10
MonsterBev MNST 52.31 -0.41
Moody's
MCO 163.12 0.41
MorganStanley MS 51.08 -0.62
Mosaic
MOS 27.01 -0.13
MotorolaSol MSI 107.69 0.06
Mylan
MYL 36.05 -0.72
NICE
NICE 96.54 -0.90
s NRG Energy NRG 32.35 1.87
NVR
NVR 3163.07 69.85
t NXP Semi NXPI 92.36-10.36
Nasdaq
NDAQ 86.01 -1.90
NationalGrid NGG 57.94 0.23
NatlOilwell NOV 38.38 -0.04
NatlRetailProp NNN 39.02 0.54
NektarTherap NKTR 82.75 -2.56
NetApp
NTAP 67.19 -0.21
Netease
NTES 249.21 -5.56
Netflix
NFLX 311.69 -1.67
Neurocrine NBIX 80.38 0.30
NewOrientalEduc EDU 91.57 0.06
NewResidInvt NRZ 17.77 0.10
NY CmntyBcp NYCB 11.87 -0.07
NewellBrands NWL 26.69 -0.16
NewmontMin NEM 39.81 0.62
NewsCorp A NWSA 15.88 0.17
NewsCorp B NWS 16.20 0.35
NextEraEnergy NEE 163.06 -0.39
Nike
NKE 66.90 -1.36
NiSource
NI
25.57 0.19
NobleEnergy NBL 32.47 -0.60
Nokia
NOK 5.89 0.11
NomuraHoldings NMR 5.56 -0.01
Nordson
NDSN 127.61 0.36
Nordstrom JWN 49.28 -0.92
NorfolkSouthern NSC 140.94 -0.74
NorthernTrust NTRS 103.98 -0.58
NorthropGrum NOC 315.68 8.52
t NorwegCruise NCLH 51.10 -0.93
Novartis
NVS 76.32 0.53
NovoNordisk NVO 48.12 -0.89
Nucor
NUE 61.22 0.23
Nutanix
NTNX 52.71 0.61
Nutrien
NTR 46.00 -0.02
NVIDIA
NVDA 232.99 6.68
R S
RELX
RENX 21.09
RELX
RELX 21.43
RPM
RPM 47.89
RSP Permian RSPP 48.03
RalphLauren RL 107.29
RandgoldRscs GOLD 82.63
RaymondJames RJF 87.59
Raytheon RTN 201.53
RealtyIncome O
51.29
RedHat
RHT 164.13
RegencyCtrs REG 57.75
t RegenPharm REGN 292.41
RegionsFin RF 18.42
ReinsGrp
RGA 149.55
RelianceSteel RS 88.51
RepublicSvcs RSG 67.24
ResMed
RMD 96.98
RestaurantBrands QSR 54.39
RioTinto
RIO 55.46
RobertHalf RHI 61.41
Rockwell
ROK 169.95
RockwellCollins COL 131.62
RogersComm B RCI 46.82
Rollins
ROL 48.58
RoperTech ROP 264.67
RossStores ROST 80.37
RoyalBkCanada RY 75.92
RoyalBkScotland RBS 7.41
RoyalCaribbean RCL 106.34
RoyalDutchA RDS.A 69.61
RoyalDutchB RDS.B 72.23
RoyalGold RGLD 87.97
Ryanair
RYAAY 112.45
SAP
SAP 113.14
S&P Global SPGI 189.63
...
0.01
-0.25
-1.80
0.73
1.24
-0.93
0.45
0.48
1.53
-0.36
-3.73
-0.13
-2.04
1.21
2.87
1.16
0.54
0.44
-0.29
2.56
-0.12
-0.13
0.06
2.03
0.66
0.06
-0.05
-0.85
0.43
0.49
-0.22
-0.36
1.16
1.65
Stock
Net
Sym Close Chg
Stock
Net
Sym Close Chg
Stock
Net
Sym Close Chg
SBA Comm SBAC 156.16 0.31 SuncorEnergy SU 38.08 0.10 t Trimble
TRMB 34.34
SEI Investments SEIC 61.71 -1.10 SunTrustBanks STI 66.05 -0.56 TurkcellIletism TKC 8.02
Sina
SINA 93.88 -1.08 Symantec SYMC 27.73 -0.19 TurquoiseHill TRQ 2.94
SINOPEC
SHI 64.81 -1.05 SynchronyFin SYF 32.13 -0.80 21stCenturyFoxA FOXA 36.88
SK Telecom SKM 23.71 0.20 Synopsys SNPS 86.49 0.48 21stCenturyFoxB FOX 36.33
SLGreenRealty SLG 97.51 0.50 SynovusFin SNV 52.11 -0.48 Twitter
TWTR 30.67
SYY 62.18 -0.63 TylerTech TYL 219.56
SS&C Tech SSNC 47.98 -0.32 Sysco
SVB Fin
SIVB 303.48 -2.53
TysonFoods TSN 66.05
Sabre
SABR 23.31 0.03
UBS Group UBS 16.52
SageTherap SAGE 148.13 1.53 TAL Education TAL 37.22 1.04 UDR
UDR 35.91
Salesforce.com CRM 124.41 1.59 TD Ameritrade AMTD 58.47 -0.41 UGI
UGI 48.66
Sanofi
SNY 39.12 0.17 TE Connectivity TEL 91.65 -0.15 US Foods USFD 33.31
SantanderCons SC 18.41 -0.35 Telus
USG 41.49
TU 35.66 -0.05 USG
Sasol
SSL 35.42 -0.04 Ternium
TX 41.20 1.52 UbiquitiNetworks UBNT 71.04
Schlumberger SLB 67.72 -0.94 TIM Part
TSU 21.90 0.14 UltaBeauty ULTA 246.87
SchwabC
SCHW 55.00 -0.65 TJX
TJX 83.56 0.03 UltSoftware ULTI 249.11
Seagate
STX 54.97 0.27 T-MobileUS TMUS 55.92 -1.05 t UltraparPart UGP 15.34
SealedAir SEE 43.91 0.20 TRowePrice TROW 109.44 -1.16 UnderArmour A UAA 17.37
SeattleGenetics SGEN 53.98 -0.45 s TableauSftwr DATA 90.79 5.61 UnderArmour C UA 15.57
SemicondctrMfg SMI 6.60 0.23 TaiwanSemi TSM 38.10 0.35 Unilever
UN 54.72
SempraEnergy SRE 111.41 0.25 TakeTwoSoftware TTWO105.10 0.22 Unilever
UL 53.63
ServiceCorp SCI 35.83 -0.19 Tapestry
TPR 46.09 -0.28 UnionPacific UNP 131.73
ServiceMaster SERV 53.04 -0.30 TargaResources TRGP 46.30 -1.13 UnitedContinental UAL 67.52
ServiceNow NOW 168.73 3.23 Target
TGT 71.15 -0.30 UnitedMicro UMC 2.68
ShawComm B SJR 20.03 -0.15 TataMotors TTM 24.73 -0.34 UPS B
UPS 109.81
SherwinWilliams SHW 370.25 -0.88 TechnipFMC FTI 32.76 -0.36 UnitedRentals URI 149.80
ShinhanFin SHG 44.42 -0.04 TeckRscsB TECK 25.54 0.52 US Bancorp USB 49.98
Shire
SHPG 156.61 -0.84 TelecomArgentina TEO 27.39 -1.55 US Steel
X
32.91
Shopify
SHOP 135.17 10.36 TelecomItalia A TI.A 8.72 -0.10 UnitedTech UTX 117.70
SignatureBank SBNY 126.90 -2.02 TelecomItalia TI
UnitedHealth
UNH
234.15
10.06 0.06
SimonProperty SPG 159.04 -0.15 TeledyneTech TDY 183.58 3.59 UniversalHealthB UHS 117.36
SiriusXM
SIRI 6.50 0.18 Teleflex
TFX 266.15 -3.44 t UnumGroup UNM 39.05
Skyworks SWKS 92.25 0.89 Ericsson
VER 6.85
ERIC 7.52 0.08 VEREIT
SmithAO
AOS 60.95 0.17 TelefonicaBras VIV 13.71 -0.28 VF
VFC 78.46
Smith&Nephew SNN 36.00 -2.41 Telefonica TEF 9.99 -0.05 VICI Prop VICI 17.85
Smucker
SJM 111.41 -2.42 TelekmIndonesia TLK 26.63 -0.81 Visa
V
127.18
t Snap
SNAP 10.97 -0.06 s Tenaris
TS 38.77 0.19 VailResorts MTN 224.50
SnapOn
SNA 143.13 -2.06 Teradyne
VALE 13.89
TER 34.88 0.55 Vale
SOQUIMICH SQM 53.85 0.14 Tesla
TSLA 284.45-16.70 ValeantPharm VRX 17.76
Sony
SNE 47.10 0.44 TevaPharm TEVA 17.78 -0.82 s ValeroEnergy VLO 113.37
Southern
SO 46.26 0.01 TexasInstruments TXN 103.60 0.64 VarianMed VAR 116.78
SoCopper SCCO 51.81 0.07 Textron
VVC 70.52
TXT 62.57 0.13 Vectren
SouthwestAir LUV 52.24 0.03 ThermoFisherSci TMO 208.32 -0.52 Vedanta
VEDL 17.44
t SpectraEnerPtrs SEP 31.33 -1.85 ThomsonReuters TRI 39.23 -0.52 VeevaSystems VEEV 70.79
Ventas
VTR
52.53
SpiritAeroSys SPR 82.20 -1.69 3M
MMM 195.68 1.18
VRSN 120.00
Splunk
SPLK 105.83 2.83 Tiffany
TIF 102.32 0.64 VeriSign
Spotify
SPOT 160.38 -9.62 TimeWarner TWX 92.18 -0.84 VeriskAnalytics VRSK100.61
VZ 47.84
Sprint
S
5.21 0.04 Toll Bros
TOL 42.78 0.71 Verizon
Square
SQ 49.21 0.55 Torchmark TMK 84.09 -0.78 VertxPharm VRTX 149.64
StanleyBlackDck SWK 139.35 -0.35 Toro
TTC 58.17 0.04 Viacom B VIAB 29.37
Starbucks SBUX 56.13 -0.57 TorontoDomBk TD 56.47 -0.04 Viacom A VIA 33.90
VIPS 15.77
StateStreet STT 96.40 -1.34 Total
TOT 62.36 0.45 Vipshop
Statoil
STO 25.63 0.25 TotalSystem TSS 83.97 0.72 VirtuFinancial VIRT 35.95
SteelDynamics STLD 44.72 0.02 ToyotaMotor TM 130.11 -0.07 VistraEnergy VST 23.14
VMW 132.87
STMicroelec STM 22.91 0.22 TractorSupply TSCO 66.15 -2.05 VMware
Stryker
SYK 166.81 -0.22 TransCanada TRP 42.84 0.12 Vodafone VOD 28.99
SumitomoMits SMFG 8.22 -0.01 TransDigm TDG 320.21 1.24 VornadoRealty VNO 69.39
SunComms SUI 93.64 0.16 TransUnion TRU 66.76 1.05 VoyaFinancial VOYA 51.04
SunLifeFinancial SLF 40.61 -0.52 Travelers
TRV 127.31 -1.01 VulcanMatls VMC 122.20
T U V
...
-0.25
-0.05
0.15
0.20
0.12
0.38
-1.44
...
-0.15
0.40
-0.63
-0.06
-1.15
-1.55
-0.77
-1.58
-0.99
-0.80
0.43
0.34
0.46
-0.40
-0.02
-1.34
0.51
0.12
0.66
-0.80
0.69
-0.34
-0.73
0.04
-1.21
-0.02
0.80
2.34
0.16
-0.25
1.12
0.54
0.30
0.14
0.10
0.16
1.95
0.61
0.09
0.17
-0.28
-0.35
0.09
-0.30
0.15
0.38
-0.13
0.08
-0.96
8.54
Stock
Net
Sym Close Chg
W X Y Z
WABCO
WBC 127.52
WEC Energy WEC 64.50
s WEX
WEX167.12
W.P.Carey WPC 63.55
WPP
WPP 86.83
s WPX Energy WPX 17.50
Wabtec
WAB 88.59
WalgreensBoots WBA 62.23
Walmart
WMT 86.23
WasteConnections WCN 73.60
WasteMgt WM 82.94
Waters
WAT 190.04
Watsco
WSO 168.14
Wayfair
W 76.17
Weibo
WB 115.70
WellCareHealth WCG 214.25
WellsFargo WFC 51.54
Welltower WELL 55.49
WestPharmSvcs WST 86.11
WestarEnergy WR 54.05
WestAllianceBcp WAL 58.60
t WesternDigital WDC 76.98
WesternGasEquity WGP 34.37
WesternGasPtrs WES 47.77
WesternUnion WU 19.40
WestlakeChem WLK105.17
WestpacBanking WBK 21.94
WestRock WRK 58.42
Weyerhaeuser WY 36.33
WheatonPrecMet WPM 21.24
Whirlpool WHR 151.74
Williams
WMB 26.10
WilliamsPartners WPZ 36.30
WillisTowers WLTW 147.46
t Wipro
WIT 4.68
WooriBank WF 43.56
Workday
WDAY 128.70
Worldpay WP 81.39
Wyndham WYN105.50
WynnResorts WYNN 191.62
XPO Logistics XPO 99.93
XcelEnergy XEL 46.48
Xerox
XRX 28.31
Xilinx
XLNX 65.82
Xylem
XYL 69.63
YPF
YPF 19.65
YY
YY 95.29
Yandex
YNDX 33.95
YumBrands YUM 82.67
YumChina YUMC 36.91
ZTO Express ZTO 16.68
ZayoGroup ZAYO 35.24
ZebraTech ZBRA 133.54
Zillow A
ZG 51.47
Zillow C
Z
51.51
ZimmerBiomet ZBH 115.18
ZionsBancorp ZION 54.45
Zoetis
ZTS 80.38
-1.76
0.12
5.84
-0.18
0.80
0.09
0.98
-1.42
-0.11
2.00
2.10
0.85
1.25
2.10
-0.63
2.81
-0.26
0.44
0.49
0.66
-0.58
0.21
-0.08
0.04
0.15
-2.78
0.15
0.29
-0.21
0.28
-2.50
-0.05
0.07
0.87
-0.04
0.02
2.33
-0.23
-3.06
0.59
6.34
-0.06
-1.07
0.70
0.75
-1.05
-2.16
-0.30
2.47
-0.09
0.22
-0.41
0.42
0.73
0.68
-2.28
-0.74
0.48
Dividend Changes
New Highs and Lows |
Highs
Lows
G H I
Data provided by
Thursday, May 3, 2018
Net YTD
NAV Chg % Ret Fund
19.44
GlblAlloc p
4.5 BlackRock Funds Inst
22.25
EqtyDivd
3.8 GlblAlloc
19.57
-2.6 StratIncOpptyIns 9.84
-1.4 Bridge Builder Trust
-2.3 CoreBond
NA
-3.1 Dimensional Fds
1.2 5GlbFxdInc
10.83
0.8 EmgMktVa
31.61
-0.9 EmMktCorEq 22.95
4.0 IntlCoreEq
14.62
-0.1 IntlVal
20.66
-1.3 IntSmCo
21.44
-2.4 IntSmVa
22.88
2.4 US CoreEq1
22.52
5.9 US CoreEq2
21.17
-0.1 US Small
35.57
1.8 US SmCpVal 37.45
-1.1 US TgdVal
24.49
-1.4 USLgVa
37.59
Dodge & Cox
-2.3 Balanced
102.97
-2.2 GblStock
13.42
13.44
Income
Net
Sym Close Chg
O P Q
Fund
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
Stock
DCT Industrial DCT 65.60 0.08
t DISH Network DISH 33.09 -0.24
DTE Energy DTE 104.60 -0.15
DXC Tech DXC 101.21 -0.46
Danaher
DHR 99.00 -0.56
Darden
DRI 91.83 -0.16
DaVita
DVA 63.30 -0.08
Deere
DE 136.87 2.12
DellTechs DVMT 71.20 0.50
DeltaAir
DAL 51.79 -0.57
DentsplySirona XRAY 49.24 -1.35
t DeutscheBank DB 13.63
...
DevonEnergy DVN 37.20 -1.03
s DexCom
DXCM 83.81 9.50
Diageo
DEO 141.51 1.03
DiamondbkEner FANG 126.51 -2.41
DigitalRealty DLR 104.97 -0.37
DiscoverFinSvcs DFS 69.60 -0.90
DiscoveryA DISCA 22.87 -0.71
DiscoveryC DISCK 21.63 -0.65
Disney
DIS 98.76 -0.86
s DocuSign DOCU 41.96 2.64
DolbyLab
DLB 61.21 0.11
DollarGeneral DG 96.30 -0.10
DollarTree DLTR 95.56 -0.65
DominionEner D
65.53 -0.66
Domino's
DPZ 245.83 1.55
Donaldson DCI 44.47 0.01
DouglasEmmett DEI 38.03 0.30
Dover
DOV 89.52 -0.25
DowDuPont DWDP 63.47 -0.02
DrPepperSnap DPS 118.80 -0.58
Dropbox
DBX 30.19 -0.82
DukeEnergy DUK 79.76 -0.22
DukeRealty DRE 27.82 0.09
ENI
E
38.92 -0.12
Dividend announcements from May 3.
EOG Rscs EOG 116.01 -0.64
Amount
Amount
Payable /
Payable /
EPAM Systems EPAM 114.96 0.42
Company
Symbol Yld % New/Old Frq
Company
Symbol Yld % New/Old Frq
Record
Record
EQT
EQT 47.09 -2.70
COT
E*TRADE ETFC 60.45 -0.42
Q
Cott Cp
1.6
.06
Jun13 /Jun01
Increased
EXACT Sci EXAS 49.08 -0.78
GIL
Q
Gildan Activewear
1.5
.112
Jun11 /May17
AMOT 0.3 .03 /.025 Q May30 /May17
Allied Motion Techs
EastWestBncp EWBC 66.71 -0.90
IBA
1.5 .45245 SA May21 /May11
Industrias Bachoco ADR
MTRN 0.8 .105 /.10 Q
Jun01 /May16
Materion
EastmanChem EMN 102.87 0.23
TEF 4.8
Telefonica ADR
.23936 SA
Jun28 /Jun14
NBHC
1.6 .14 /.09 Q Jun15 /May25
National Bank Holdings
Eaton
ETN 73.07 0.91
WCN 0.8
Q May30 /May16
.14
Waste Connections
NHTC 2.7
Natural Health Trends
.14 /.13 Q May25 /May15
EatonVance EV 54.57 0.24
AUY 0.7
Q
.005
Jul13 /Jun29
Yamana Gold
TTEK 1.0
eBay
EBAY 37.64 0.46
.12 /.10 Q Jun01 /May16
Tetra Tech
Ecolab
ECL 144.18 -0.06
VSM 0.7
Versum Materials
.06 /.05 Q May29 /May15 Special
Ecopetrol
EC 21.72 -0.17
NHTC 2.7
Natural Health Trends
1.76
May25 /May15
Reduced
EdisonInt
EIX 63.22 -0.41
NYRT
New York REIT
4.85
May18 /May11
EdwardsLife EW 132.82 1.14
OZM 3.9
Och-Ziff Capital Mgmt
.02 /.07 Q May21 /May14
ElectronicArts EA 120.17 1.23
TCP 10.5 .65 /1.00 Q May15 /May09
TC PipeLines
EmersonElec EMR 67.42 -0.18
Enbridge
ENB 30.90 0.23
Foreign
KEY: A: annual; M: monthly; Q: quarterly; r: revised; SA: semiannual;
Encana
ECA 12.74 -0.20
AXSpE 5.7
AXIS Capital Pfd. E
.34375 Q
Jul16 /Jun29
s EncompassHealth EHC 62.81 0.45
Jun15 /Jun01 S2:1: stock split and ratio; SO: spin-off.
Barclays ADR Pfd Ser 5 BCSpD 7.8 .50781 Q
EnelAmericas ENIA 10.90 -0.14
EnelChile
ENIC 6.01 -0.09
EnelGenChile EOCC 23.25 -0.11
Energen
EGN 63.17 -1.71
52-Wk %
52-Wk %
WSJ.com/newhighs
Stock
Sym Hi/Lo Chg Stock
Sym Hi/Lo Chg
EnergyTransferEq ETE 16.29 0.29
EnergyTransfer ETP 17.66 -0.40
93.47 -1.4
61.15 -0.7 Manpower
Coca-Cola Femsa KOF
MAN
Entergy
ETR 82.35 0.74
The following explanations apply to the New York Stock Exchange, NYSE Arca, NYSE
29.20 -1.6 MercurySystems MRCY 30.52 2.7
Colfax
CFX
EnterpriseProd EPD 26.66 0.15
American and Nasdaq Stock Market stocks that hit a new 52-week intraday high or low ColgatePalm CL
50.05 -3.6
MDP
62.84 0.3 Meredith
Equifax
EFX 112.50 -0.21
in the latest session. % CHG-Daily percentage change from the previous trading session.
59.32 -2.0
Comcast A
CMCSA 30.55 -0.9 MolsonCoors B TAP
Equinix
EQIX 398.13-25.96
9.59 -1.0
1.90 -2.8 MuellerWater MWA
CommandSec MOC
EquityLife ELS 89.73 0.12
Thursday, May 3, 2018
90.83 -10.1
NXPI
0.27 -12.2 NXP Semi
ConcordiaIntl CXRX
EquityResdntl EQR 61.60 0.09 JD.com
JD 37.20 0.12
52-Wk %
52-Wk %
52-Wk % Corning
26.11 -0.5 NanoDimension NNDM 1.21 -5.6
GLW
EssexProp ESS 238.43 -1.86 JPMorganChase JPM 107.24 -0.68
Stock
Sym Hi/Lo Chg Stock
Sym Hi/Lo Chg Stock
Sym Hi/Lo Chg CorpAmAirports CAAP 11.09 -3.9 NetScout
NTCT 23.15 -1.8
EsteeLauder EL 134.12 1.53 JackHenry JKHY 120.86 2.93
4.50 2.9
NETS
42.63 -4.2 Netshoes
7.60 -1.1 WW Ent
ManhattanBridge LOAN
WWE 41.60 4.0 CrownHoldings CCK
EverestRe RE 226.15 -2.02 JacobsEngg JEC 57.15 -0.58
NEU 359.62 -0.5
140.60 -1.8 NewMarket
CMI
XOXO 26.69 7.1 Cummins
MellanoxTech MLNX 81.25 1.4 XO Group
EversourceEner ES 58.87 -0.82 JamesHardie JHX 17.70 0.02
DISH Network DISH 32.04 -0.7 NielsenHoldings NLSN 29.65 -0.2
MeritMedical MMSI 50.35 0.4
Abiomed
ABMD 341.89 11.1
Exelixis
EXEL 22.22 1.60 JanusHenderson JHG 31.19 0.03
8.14 -1.3 NorwegCruise NCLH 50.69 -1.8
DeanFoods
DF
27.79 -1.9
MorphoSys
MOR
AlliedMotionTech AMOT 45.56 2.8
Exelon
EXC 40.85 0.47 JazzPharma JAZZ 148.03 -3.49
8.50 2.3
ORBC
13.50 ... Orbcomm
DeutscheBank DB
MTechAcqnUn MTECU 10.52 0.7
ABMIndustries ABM 30.16 -0.8
10.20
6.7
Attunity
ATTU
Expedia
EXPE 111.28 -3.15 JetBlue
0.35 -4.3
JBLU 19.21 -0.13
DiamondHillInvt DHIL 183.34 -1.9 OnconovaTherap ONTX
MTechAcqnWt MTECW 0.77 -5.3
ADOMANI
ADOM 0.59 -2.8
54.14 0.7
Avangrid
AGR
ExpeditorsIntl EXPD 62.99 -0.01 t J&J
5.63 -5.3
OrchidsPaper
TIS
JNJ 123.03 -0.47
12.00
-6.6
DieboldNixdorf
DBD
32.79 6.1
NRG Energy
NRG
AGCO
AGCO 58.12 0.3
AveXis
AVXS 217.86 0.2
ExpressScripts ESRX 72.20 -1.85 JohnsonControls JCI 35.39 0.08
15.00 0.3
53.87 -2.1 OritaniFinancial ORIT
EQT Midstream EQM
Nanometrics
NANO 35.67 0.6
31.61 -0.4
AT&T
T
AxoGen
AXGN 41.77 5.9
s ExtraSpaceSt EXR 91.74 2.18 JonesLang JLL 169.79 -1.29
18.70
-1.6
Owens-Illinois
OI
0.12 -4.3
EV Energy
EVEP
nLIGHT
LASR 30.00 1.1
0.73 -1.9
AcastiPharma ACST
BGStaffing
BGSF 21.25 1.2
6.53 -0.3
PPDF
ExxonMobil XOM 76.54 -0.26 JuniperNetworks JNPR 25.16 0.24
EchoStar
SATS 51.35 -0.9 PPDAI
6.65 -1.5
NorthAmConstr NOA
7.20
-4.7
Adecoagro
AGRO
24.59
3.2
Box
BOX
s F5Networks FFIV 168.32 2.60 KAR Auction KAR 52.75 0.67
PCAR 60.36 0.8
39.50 1.0 Paccar
EdgewellPersonal EPC
5.04 0.8
NovaGoldRscs NG
Adient
ADNT 54.70 -9.9
BOXL 17.40 12.3
PCGpI 19.10 0.8
FMC
FMC 83.73 3.38 KB Fin
ElbitSystems ESLT 112.61 -0.3 PacGE pfI
KB 55.71 0.02 OGE Energy OGE 33.74 0.64 Boxlight
Nuvectra
NVTR 15.15 14.5
1.75 -8.5
AgEagleAerial UAVS
31.05 -0.3
CTS
CTS
50.52 -7.3
PampaEnergia PAM
Facebook
FB 174.02 -2.05 KKR
3.55
-4.1
EvolvingSystems
EVOL
KKR 22.14 0.64 s ONEOK
63.17
0.4
ONEOK
OKE
OKE 62.84 0.27 Cannae
5.01 1.8
AileronTherap ALRN
20.99
1.0
CNNE
96.70 0.4
PepsiCo
PEP
FactSet
FDS 186.97 0.92 KLA Tencor KLAC 102.99 0.82
4.21 -2.7
XELA
OReillyAuto ORLY 258.94 -0.56 CapellaEducation CPLA 98.20 -3.3 OhioValleyBanc OVBC 46.80 -0.3 AirTransportSvcs ATSG 19.17 2.8 ExelaTech
14.78 -3.2
PermRock
PRT
Fastenal
FAST 49.49 0.33 KT
FarmerBros
FARM 27.10 -0.5
Okta
OKTA 45.64 2.2
KT 13.64 0.27 OccidentalPetrol OXY 77.29 0.46
10.76
-7.8
Akorn
AKRX
10.33 -7.5
CareDx
PZE
CDNA 10.52 2.9
FederalRealty FRT 117.39 1.87 KSCitySouthern KSU 106.46 -0.13
FedRealtyInvPfdC FRTpC 21.32 -0.5 Petrobras
OldDomFreight ODFL 133.17 0.13 CareerEducation CECO 14.68 9.3 OspreyEnergyWt OSPRW 1.33 33.8 Allegion
73.85 -0.4
ALLE
79.71 0.4
PhilipMorris
PM
FedEx
FDX 242.15 1.55 Kellogg
24.64 -0.2
FederatedInvest FII
39.50 0.4 AllianceData
PBF Energy
PBF
K
58.15 1.50 OldRepublic ORI 19.78 -0.24
ADS 193.87 -2.3
8.54 -5.1
PitneyBowes PBI
Centene
CNC 116.07 0.7
s Ferrari
RACE130.99 5.18 KeyCorp
53.56
-0.5
FortBrandsHome
FBHS
Penumbra
PEN 134.00 4.1 AlpineImmune ALPN
KEY 19.37 -0.39 Omnicom OMC 74.13 0.61
6.85
0.7
0.15 -13.9
PlatinumGrpMtls
PLG
CenterStateBank CSFL 29.97 0.3
FiatChrysler FCAU 22.49 -0.14 KeysightTechs KEYS 51.63 0.42
31.67 -0.6
FranklinRscs
BEN
PSX 115.61 0.9 AlticeUSA
ATUS 16.61 -1.8
ON Semi
ON 22.08 -0.12 CeridianHCM CDAY 34.43 3.2 Phillips66
0.36 -1.9
Precipio
PRPO
FibriaCelulose FBR 19.61 0.05 KilroyRealty KRC 72.08 0.23
1.74 -10.8
Fred's
FRED
4.20 7.8 Altimmune
0.61 -9.8
ALT
OpenText OTEX 35.93 -0.18 ChannelAdvisor ECOM 13.95 2.2 PioneerEnerSvcs PES
54.89 -1.7
PrincipalFin
PFG
FidNatlFin FNF 38.02 0.87 KimberlyClark KMB 102.35 1.28
19.25 -12.0
Q2Holdings
QTWO 55.35 10.6 AmHomes4RentPfdG AMHpG 22.27 -0.2 GP Strategies GPX
Oracle
ORCL 45.06 -0.45 CharterFin
95.83
-3.6
PrudentialFin
PRU
CHFN 24.01 0.3 Rapid7
FidNatlInfo FIS 99.41 0.92 KimcoRealty KIM 14.36 -0.07
GWG
GWGH 7.59 -0.4
29.75 0.7 AIG Wt
RPD
AIG.WS 13.25 -12.1
Orange
ORAN 18.07 0.01 Chemed
9.56 -1.0
Qudian
QD
CHE 314.21 0.2 Rayonier
FifthThirdBncp FITB 32.28 -0.47 KinderMorgan KMI 15.82 -0.34
GabelliDivPfdD GDVpD 25.54 -1.0
39.14 0.9 AIG
RYN
49.57 -5.3
AIG
OrbitalATK OA 133.45 -0.12 ConstellatnAlpha CNAC
7.10 -7.2
QuintanaEnergy QES
9.98 0.5 RegalwdGlbEner RWGE
FirstAmerFin FAF 52.13 0.93 Knight-Swift KNX 38.81 -0.54
9.81 -0.1 AmiraNatureFoods ANFI
3.63 -0.8 GatesIndustrial GTES 14.77 -2.7 REV
Orix
IX
89.74 -0.17 CryoLife
REVG 16.79 -1.7
24.45 4.3 RexfordIndlRealty REXR 31.72 -0.3
CRY
5.12 -3.4
FirstData
FDC 18.35 0.25 Kohl's
KSS 63.19 0.16 OwensCorning OC 64.67 -0.70
AndeavorLog ANDX 40.66 -3.2 GemphireTherap GEMP
Realogy
RLGY 23.52 -2.7
29.98
1.2
CubeSmart
CUBE
41.01 -3.0
GIS
FirstHorizonNatl FHN 18.22 -0.16 KoninklijkePhil PHG 43.00 0.14
9.45 1.2 AnikaTherap
RichardsonElec RELL
ANIK 30.91 -24.7 GeneralMills
RegenPharm REGN 288.16 -1.3
PG&E
PCG 44.37 -1.50 DSW
22.85 -0.8 RingCentral
DSW
24.64 -1.0
GT
72.10 0.4 AnixterIntl
FirstRepBank FRC 94.17 0.37 KoreaElcPwr KEP 17.37 -0.06
RNG
56.50 -5.6 Goodyear
AXE
3.79 -4.3
RestorationRob HAIR
PLDT
PHI 26.35 -0.49 DawsonGeophys DWSN 7.72 9.9
10.70 -4.0
GrayTelevision GTN
RockyBrands RCKY 27.20 -6.0 AnnalyCap
FirstSolar FSLR 65.98 -2.04 KraftHeinz KHC 54.95 0.75
9.95
-0.7
NLY
2.30 -8.5
RXiPharm
RXII
PNC Fin
PNC 145.02 1.41 DelekUS
50.36 3.1 RudolphTech
DK
RTEC 31.78 17.2 Apergy
FirstEnergy FE 33.88 -0.13 Kroger
APYw 33.35 -6.1 GrayTelevision A GTN.A 9.70 -3.0 ScottsMiracleGro SMG
KR 23.87 -0.68 POSCO
76.60
1.8
PKX 84.67 -1.66 DenburyRscs DNR
3.43 -3.5 Seaspan
1.31 1.9
8.42 -1.5 ArchCapital
SSW
Fiserv
FISV 68.99 -0.04 Kyocera
ACGL 77.12 -1.2 Gulf Resources GURE
KYO 61.07 -0.03 PPG Ind
10.70 -0.9
ScrippsEW
SSP
PPG 104.96 -0.75 DexCom
85.25
12.8
DXCM
16.43 -4.5
Hanesbrands HBI
6.81 13.5 Arconic
SensusHealthcare SRTS
FleetCorTech FLT 210.44 -0.03 LATAMAirlines LTM 14.39 -0.25
16.66
-2.2
ARNC
26.59
-4.1
SilganHoldings
SLGN
PPL
PPL 28.65 -0.04 DocuSign
DOCU 42.56 6.7 SpartanMotors SPAR 19.45 -5.4
39.34 -0.5
Flex
FLEX 13.99 0.29 L Brands
AscentCapital A ASCMA 3.02 -7.6 HarleyDavidson HOG
LB 34.54 0.19 PTC
SinclairBroadcast SBGI 26.50 -2.2
PTC 83.86 0.35 EnantaPharma ENTA 99.81 1.7
HWKN 30.55 -4.2
StaarSurgical STAA 22.60 26.3 Atento
FlirSystems FLIR 53.68 -0.18 LG Display LPL 10.84 -0.01
7.10 -4.1 Hawkins
ATTO
4.50 -14.2
Smart&FinalStores SFS
PVH
PVH 151.46 -0.80 EncompassHealth EHC
62.89 0.7 SteinMart
89.10 0.2
HSY
2.50 -3.7 BCE
SMRT
Flowserve FLS 44.97 -0.28 LINE
41.01 -1.3 Hershey
BCE
Snap
SNAP 10.51 -0.5
LN 36.00 0.04 t Paccar
PCAR 62.64 0.47 EnsignGroup ENSG 31.70 10.3 StrayerEd
HOLX 35.10 -6.9
STRA 113.01 -3.1 BancoSantPfd4 SANpA 24.98 -0.1 Hologic
Fluor
FLR 58.99 0.25 LKQ
8.00 -0.5
SolGelTech
SLGL
LKQ 30.24 -0.03 PackagingCpAm PKG 113.68 1.59 Espey
29.06 -0.1 SummitStateBk SSBI
ESP
5.99 -20.4
16.00 -3.9 BarnesGroup
FomentoEconMex FMX 90.09 -1.28 L3 Tech
52.42 -1.7 HorizonGlobal HZN
B
31.16 -5.6
SpectraEnerPtrs SEP
LLL 183.23 -1.03 PacWestBancorp PACW 51.24 -0.61 EuroTech
8.45 155.6 SurfaceOncol SURF 15.19 -3.2
CLWT
3.65 -5.3 Startek
HDSN
FordMotor F
11.20 -0.01 LabCpAm LH 169.64 -1.30
BedBath
BBBY 16.79 -3.9 HudsonTech
8.02 -2.6
SRT
PagSeguroDig PAGS 31.71 -1.35 Evertec
EVTC 20.50 2.5 Surmodics
5.08 -0.2 Stepan
IDT
SRDX 40.80 1.9 BeldenPfdB
BDCpB 81.51 -5.9 IDT
Fortinet
FTNT 56.11 0.17 LamResearch LRCX 189.43 -0.09
68.42 -3.1
SCL
PaloAltoNtwks PANW 193.42 -3.27 Exponent
EXPO 87.75 0.2 Synalloy
16.37 -1.1 Stratasys
ING
SYNL 19.30 6.5 Belden
57.65 -6.7 ING Groep
BDC
Fortis
FTS 33.48 0.47 LamarAdv LAMR 66.12 -0.86
SSYS 17.17 -2.9
ParkHotels PK 28.75 0.17 ExtraSpaceSt EXR
92.15 2.4 TableauSftwr DATA 97.09 6.6 BerryGlobal
27.35 -0.6 SummerInfant SUMR
IVZ
BERY 48.24 -7.7 Invesco
Fortive
FTV 72.51 0.99 LambWeston LW 64.04 0.09
0.72 -7.9
ParkerHannifin PH 168.37 0.55 Ezcorp
EZPW 14.65 4.7 Talend
20.51 -2.5 TC PipeLines
IRS
TLND 52.19 3.8 BiglariB
203.85 -10.3 IRSA
BH
t FortBrandsHome FBHS 54.30 -0.27 LasVegasSands LVS 75.36 0.11
23.27 -1.7
TCP
ParsleyEnergy PE 29.29 -0.85 F5Networks
FFIV 168.63 1.6 TejonRanch
42.00 -4.4 Tegna
IRCP
25.20 0.6 BiglariA
TRC
BH.A 980.00 -12.1 IRSA Prop
10.03
-3.4
TGNA
Franco-Nevada FNV 73.16 1.33 Lazard
LAZ 52.44 -0.82 Paychex
PAYX 61.67 0.85 Ferrari
RACE 133.45 4.1 Tenaris
0.58 -7.5 TESARO
ICON
39.16 0.5 BioLineRX
TS
0.78 -3.6 IconixBrand
BLRX
t FranklinRscs BEN 32.35 -0.18 Lear
TSRO 48.00 -5.1
LEA 189.00 0.70 PaycomSoftware PAYC 105.12 0.74 FirstBanCorp FBP
7.46 1.0 TenetHealthcare THC
60.23
2.2
Incyte
INCY
31.94
1.3
0.03
-6.7
BioTimeWt
BTX.WS
THL
Credit
7.70
-0.8
TCRD
FreeportMcM FCX 15.21 0.10 Leidos
LDOS 60.27 -1.77 PayPal
PYPL 73.45 1.72 FirstFinBncpWt FFBCW 22.29 4.1 TerrenoRealty TRNO 38.76 1.2 BlinkChargingWt BLNKW 0.18 -14.1 Ingredion
INGR 112.73 -2.4 Tenneco
43.48 -0.9
TEN
FreseniusMed FMS 50.04 -1.39 Lennar B
LEN.B 42.27
... Pearson
PSO 11.32 0.02 FirstCash
89.05 1.3 TexasPacLand TPL
FCFS
0.32 -11.1 TitanPharm
IPCI
639.88 1.2 BlueCapReins BCRH 10.85 -1.3 Intellipharm
0.82 -4.7
TTNP
Lennar A
LEN 53.63 0.38 PembinaPipeline PBA 31.95 0.11 GluMobile
5.02 5.3 TownSports
GLUU
10.03 0.1 TootsieRoll
INAP
CLUB 10.25 2.5 BrighthouseFin BHF
46.62 -0.3 InterNAP
27.45 -0.9
TR
LennoxIntl LII 194.53 1.36 Pentair
PNR 43.94 -1.48 GolarLNG
GLNG 33.42 -0.1 TransGlobeEner TGA
4.55 -4.2 TremontMortgage TRMT 12.15 -0.1
IVAC
1.94 3.4 CBS B
47.54 -0.5 Intevac
CBS
GGP
GGP 19.49 -0.08 LeucadiaNatl LUK 23.99 -0.29 People'sUtdFin PBCT 18.23 -0.05 GoldResource GORO 5.50 0.4 TravelportWorldwd TVPT 18.06 0.7 CBS A
2.95 -9.1 TribuneMediaA TRCO 34.92 -2.3
IVTY
CBS.A 47.98 -0.4 Invuity
Gallagher AJG 68.56 -0.08 t LibertyBroadbandA LBRDA 70.55 0.94 t PepsiCo
PEP 97.60 0.37 GulfmarkOffshore GLF
36.11 1.5 Travelzoo
121.28 -0.4 Trimble
JNJ
TZOO 13.35 -4.6 CSS Industries CSS
16.26 -2.9 J&J
TRMB 33.68 ...
Gaming&Leisure GLPI 34.36 -0.05 LibertyBroadbandC LBRDK 71.78 1.15 PerkinElmer PKI 72.17
... HamiltonLane HLNE 43.20 1.6 TurtleBeach
22.13
-0.8 UltraparPart
KimcoRealtyPfdK
KIMpK
6.22 10.3 CableOne
HEAR
CABO 597.40 0.8
15.20 -9.3
UGP
Gap
GPS 28.99 -0.13 LibertyGlobal A LBTYA 30.47 1.12 Perrigo
PRGO 75.25 -1.07 HollyFrontier HFC
66.36 1.8 UnionAcqn
5.29 -1.3 UnitedTherap UTHR 100.76 -1.9
LXU
9.75 0.5 CardinalHealth CAH
LTN
50.79 -21.4 LSB Inds
GardnerDenver GDI 31.68 0.28 LibertyGlobal C LBTYK 29.29 0.97 PetroChina PTR 71.35 -0.82 IncomeOppRealty IOR
13.79 2.0 UnionAcqnUn LTN.U 10.30 0.1 Cemex
5.86 -0.3 LibertyBroadbandA LBRDA 68.20 1.4 UnumGroup
CX
38.93 -1.8
UNM
Garmin
GRMN 60.35 -1.60 LibertyFormOne A FWONA 29.76 1.43 PetroleoBrasil PBR 13.73 -0.09 Insperity
84.50 2.0 ValeroEnergy VLO 113.89 1.0 CentralPuerto CEPU 13.74 -7.5 LibertyExpediaB LEXEB 39.17 -2.1 Valvoline
NSP
19.86 4.6
VVV
Gartner
IT 121.20 0.54 LibertyFormOne C FWONK 31.55 1.75 PetroleoBrasilA PBR.A 12.73 -0.03 IntegraLifeSci IART 63.00 1.2 VistraEnergyWt VST.WS.A 0.80 -0.9 Cerner
4.77 -6.8 Welbilt
CERN 52.05 -4.9 LifewayFoods LWAY
18.34 -1.1
WBT
PFE 34.76 -0.13 IntegratedMedia IMTE 44.00 46.3 VivoPowerIntl VVPR
Gazit-Globe GZT 9.48 0.03 LibertyBraves A BATRA 22.17 -0.44 Pfizer
6.69 225.2 ChinaXDPlastics CXDC
3.85 -4.3 LincolnElectric LECO 81.48 0.4 WesternDigital WDC
75.96 0.3
5.49 0.3 WEX
GeneralDynamics GD 195.00 -0.68 LibertyBraves C BATRK 22.77 -0.05 t PhilipMorris PM 80.44 0.34 IntelligentSys INS
LGF.B 19.97 -2.3 WestwaterRscs WWR
WEX 170.89 3.6 Chubb
128.82 -1.9 LionsGate B
CB
0.50 -8.6
GeneralElec GE 13.93 -0.25 LibertySirius A LSXMA 41.78 0.70 s Phillips66 PSX 115.59 1.07 Kforce
KFRC 31.10 4.6 WPX Energy
17.62 0.5 CincinnatiFin
LGF.A 21.54 -2.5 Wipro
WPX
68.33 -0.5 LionsGate A
CINF
4.60 -0.8
WIT
t GeneralMills GIS 41.21 -1.28 LibertySirius C LSXMK 41.58 0.60 PinnacleFoods PF 60.82 1.64 MDU Rscs
29.13 2.9 WPX Energy Pfd WPXP 73.26 1.1 ClearOne
MDU
LOMA 18.09 -5.0 WrightMedical WMGI 19.01 -0.7
5.84 -1.9 LomaNegra
CLRO
11.82 -7.2 ZaiLab
41.52 -0.4 Mallinckrodt
MNK
KO
ZLAB 17.85 -0.6
GeneralMotors GM 36.15 -0.05 LibertyProperty LPT 41.97 0.02 PinnacleWest PNW 79.81 0.39 MalibuBoats MBUU 41.49 -1.7 WhitingPetrol WLL 44.73 1.1 Coca-Cola
Top 250 mutual-funds listings for Nasdaq-published share classes by net assets.
Fund
Net
Sym Close Chg
-0.01 -1.3 Intl Stk
Net YTD
NAV Chg % Ret
45.54 +0.01
195.84 -0.89
Stock
... -1.9 DoubleLine Funds
NA
...
-0.01 -1.2 CoreFxdIncmI
10.41 +0.01
-0.01 -0.1 TotRetBdI
Edgewood Growth Instituti
... NA EdgewoodGrInst 31.89 -0.08
Fidelity
91.96 -0.20
+0.01 -0.4 500IdxInst
-0.19 1.2 500IdxInstPrem 91.96 -0.20
-0.15 -1.2 500IdxPrem 91.96 -0.20
+0.03 0.6 ExtMktIdxPrem r 62.24 -0.19
+0.02 1.0 IntlIdxPrem r 43.28 +0.01
+0.08 0.8 SAIUSLgCpIndxFd 14.13 -0.03
75.48 -0.18
+0.04 -0.4 TMktIdxF r
-0.07 -0.9 TMktIdxPrem 75.48 -0.17
-0.08 -1.7 USBdIdxInstPrem 11.22 +0.01
-0.26 -0.9 Fidelity Advisor I
32.46 -0.01
-0.23 -1.2 NwInsghtI
-0.15 -1.5 Fidelity Freedom
16.46 -0.02
-0.15 -3.5 FF2020
14.31 -0.02
FF2025
17.95 -0.03
-0.32 -2.2 FF2030
16.44 -0.02
Freedom2020
K
-0.04 -3.2
... -1.4 Freedom2025 K 14.28 -0.02
-1.7
-2.4
NA
-0.9
7.9
Net YTD
NAV Chg % Ret Fund
Net YTD
NAV Chg % Ret Fund
Freedom2030 K 17.93 -0.03 -0.6 FrankTemp/Temp Adv
Freedom2035 K 15.15 -0.03 -0.4 GlBondAdv p 11.89 -0.09
Freedom2040 K 10.64 -0.03 -0.5 Harbor Funds
CapApInst
73.49 +0.06
Fidelity Invest
67.54 -0.10
Balanc
23.62 -0.05 -0.1 IntlInst r
91.91 -0.21 4.7 Harding Loevner
BluCh
NA
...
125.88 -0.05 4.4 IntlEq
Contra
ContraK
125.84 -0.05 4.4 Invesco Funds A
10.68 -0.06
CpInc r
10.10 -0.02 -0.7 EqIncA
39.42 -0.08 -1.5 John Hancock Class 1
DivIntl
15.06 -0.02
188.85 -0.12 5.7 LSBalncd
GroCo
16.04 -0.03
GrowCoK
188.88 -0.12 5.7 LSGwth
7.69 +0.01 -2.2 John Hancock Instl
InvGB
22.81 -0.20
10.92 +0.01 -2.0 DispValMCI
InvGrBd
54.20 -0.23 -0.6 JPMorgan Funds
LowP r
38.91 -0.24
106.25 -0.20 1.6 MdCpVal L
MagIn
115.02 -0.22 4.7 JPMorgan R Class
OTC
11.26 +0.02
23.29 -0.02 -0.2 CoreBond
Puritn
SrsEmrgMkt 20.96 -0.15 -2.1 Lazard Instl
19.34 -0.20
SrsGroCoRetail 17.65 -0.01 6.1 EmgMktEq
16.05 +0.03 -0.6 Lord Abbett A
SrsIntlGrw
4.19
...
ShtDurIncmA
p
SrsIntlVal
10.66 -0.01 -0.3
TotalBond
10.35 +0.01 -1.9 Lord Abbett F
4.19
...
ShtDurIncm
First Eagle Funds
58.41 +0.01 -1.1 Metropolitan West
GlbA
10.36
+0.01
TotRetBd
FPA Funds
10.36 +0.01
NA
... NA TotRetBdI
FPACres
9.75 +0.01
TRBdPlan
FrankTemp/Frank Adv
-1.1
-1.1
-1.1
0.4
0.3
-1.1
-0.8
-0.8 IncomeAdv
2.26
...
-2.3 FrankTemp/Franklin A
7.27 +0.03
CA TF A p
3.5 IncomeA p
2.28
...
RisDv A p
59.12 -0.10
-0.7 FrankTemp/Franklin C
-0.6 Income C t
2.31 -0.01
-0.6 FrankTemp/Temp A
-0.7 GlBond A p
11.94 -0.08
-0.7 Growth A p
26.69 -0.22
-2.1 MFS Funds Class I
38.53 -0.09
ValueI
-1.5 MFS Funds Instl
25.55 +0.12
IntlEq
-2.1
Oakmark Funds Invest
-3.1
EqtyInc r
31.17 -0.11
Oakmark
83.10 -0.47
-2.3
28.39 -0.01
OakmrkInt
Old Westbury Fds
1.5
14.40 -0.01
LrgCpStr
-2.1
Oppenheimer Y
1.5 DevMktY
IntGrowY
Net YTD
NAV Chg % Ret Fund
NA
...
43.90 +0.23
5.8 Parnassus Fds
... ParnEqFd
42.13 -0.25
PIMCO Fds Instl
NA AllAsset
12.03 -0.02
NA
...
ShortT
-2.2 TotRt
9.96 +0.01
PIMCO Funds A
-0.6 IncomeFd
NA
...
-0.2 PIMCO Funds I2
Income
NA
...
-2.1 PIMCO Funds Instl
NA
...
IncomeFd
-3.4 Price Funds
BlChip
103.55 +0.09
-1.9 EqInc
32.22 -0.11
70.63 -0.15
EqIndex
-3.4 Growth
65.95 +0.04
71.06 -0.47
HelSci
-0.1 InstlCapG
39.53 +0.05
18.56 +0.01
IntlStk
-0.1 IntlValEq
15.06
...
MCapVal
30.41 -0.24
-2.1 MidCap
88.79 +0.09
-2.0 N Inc
9.19 +0.01
-2.0 NHoriz
55.69 +0.27
11.42 +0.02
OverS SF r
-5.2 R2020
22.43 -0.01
17.54 -0.01
R2025
0.4 R2030
25.89 -0.02
18.98 -0.01
R2035
-3.2 R2040
27.29 -0.02
-1.5 Value
36.02 -0.12
-0.6 PRIMECAP Odyssey Fds
...
AggGrowth r 47.34
-0.4 Growth r
39.15 +0.09
Net YTD
NAV Chg % Ret Fund
31.31 -0.03
Stock r
NA Principal Investors
NA
...
0.6 DivIntlInst
Prudential Cl Z & I
14.07
...
-0.9 TRBdZ
Schwab Funds
40.75 -0.09
-0.5 S&P Sel
NA TIAA/CREF Funds
10.47 +0.01
-2.2 BdIdxInst
19.48 -0.05
EqIdxInst
NA IntlEqIdxInst 20.29 +0.04
Tweedy Browne Fds
29.03 -0.08
NA GblValue
VANGUARD ADMIRAL
243.07 -0.52
NA 500Adml
34.08 -0.03
BalAdml
11.56 +0.03
7.5 CAITAdml
-3.0 CapOpAdml r 153.79 +0.10
37.58 -0.22
EMAdmr
-1.1
74.71 -0.02
5.3 EqIncAdml
92.52 -0.10
1.0 ExplrAdml
84.84 -0.27
7.1 ExtndAdml
10.21 +0.02
-0.6 GNMAAdml
73.41 -0.02
-0.4 GrwthAdml
... HlthCareAdml r 81.38 -0.73
5.74 -0.01
HYCorAdml
r
2.0
25.24 +0.03
-2.2 InfProAd
98.64 +0.04
5.9 IntlGrAdml
1.0 ITBondAdml 10.92 +0.01
ITIGradeAdml
9.39
...
-0.5
9.75 +0.01
-0.3 LTGradeAdml
-0.1 MidCpAdml 189.34 -0.32
94.17 +0.10
0.1 MorgAdml
11.19 +0.02
0.2 MuHYAdml
13.84 +0.03
-3.5 MuIntAdml
11.38 +0.03
MuLTAdml
MuLtdAdml
10.79
...
6.8
15.68
...
5.1 MuShtAdml
Net YTD
NAV Chg % Ret Fund
-1.9 PrmcpAdml r 134.79
RealEstatAdml 108.40
NA SmCapAdml 70.64
STBondAdml 10.24
-2.5 STIGradeAdml 10.46
10.40
TotBdAdml
-1.1 TotIntBdIdxAdm 21.82
TotIntlAdmIdx r 30.40
-2.4 TotStAdml
65.92
-0.9 TxMIn r
14.39
0.6 ValAdml
39.79
WdsrllAdml
64.90
1.9 WellsIAdml
62.64
70.34
WelltnAdml
-1.1 WndsrAdml
77.38
-1.3 VANGUARD FDS
-1.0 DivdGro
25.78
0.1 INSTTRF2020 22.35
-1.4 INSTTRF2025 22.69
-3.7 INSTTRF2030 22.96
4.6 INSTTRF2035 23.22
0.4 INSTTRF2040 23.48
-1.4 INSTTRF2045 23.66
1.7 INSTTRF2050 23.68
-3.7 IntlVal
39.61
-1.3 LifeCon
19.70
-1.1 LifeGro
33.45
3.2 LifeMod
26.93
-3.0 PrmcpCor
26.45
-2.7 SelValu r
29.29
-6.8 STAR
26.61
-0.8 TgtRe2015
15.21
3.8 TgtRe2020
31.14
-0.9 TgtRe2025
18.35
-1.1 TgtRe2030
33.39
-1.3 TgtRe2035
20.55
-0.3 TgtRe2040
35.56
0.3 TgtRe2045
22.36
+0.12
+0.03
-0.19
+0.01
...
+0.01
+0.04
...
-0.15
+0.03
-0.15
-0.47
+0.02
-0.17
-0.50
0.9
-6.9
0.1
-0.7
-0.8
-2.4
0.9
-0.1
-0.8
0.2
-3.4
-3.3
-3.4
-2.5
-2.0
-0.16
-0.01
-0.01
-0.01
-0.02
-0.02
-0.02
-0.03
-0.02
+0.01
-0.02
...
-0.02
-0.31
-0.03
...
...
-0.01
-0.02
-0.01
-0.03
-0.02
-1.8
-0.8
-0.7
-0.7
-0.6
-0.6
-0.6
-0.6
-0.7
-1.0
-0.7
-0.8
-1.7
-6.3
-0.7
-0.8
-0.8
-0.8
-0.7
-0.7
-0.6
-0.6
TgtRe2050
TgtRetInc
TotIntBdIxInv
WellsI
Welltn
WndsrII
Net YTD
NAV Chg % Ret
35.99 -0.03
13.40
...
10.91 +0.01
25.86 +0.01
40.73 -0.10
36.57 -0.26
VANGUARD INDEX FDS
243.05 -0.52
500
ExtndIstPl
209.37 -0.65
55.66 -0.21
SmValAdml
10.37 +0.01
TotBd2
TotIntl
18.18 +0.01
65.89 -0.15
TotSt
VANGUARD INSTL FDS
34.09 -0.03
BalInst
DevMktsIndInst 14.41 +0.03
DevMktsInxInst 22.53 +0.05
84.84 -0.26
ExtndInst
73.42 -0.02
GrwthInst
InPrSeIn
10.28 +0.01
239.90 -0.52
InstIdx
239.92 -0.51
InstPlus
58.60 -0.13
InstTStPlus
MidCpInst
41.83 -0.07
206.29 -0.34
MidCpIstPl
70.64 -0.19
SmCapInst
SmCapIstPl 203.90 -0.54
STIGradeInst 10.46
...
10.40 +0.01
TotBdInst
10.37 +0.01
TotBdInst2
10.40 +0.01
TotBdInstPl
TotIntBdIdxInst 32.74 +0.05
TotIntlInstIdx r 121.58 +0.02
TotItlInstPlId r 121.60 +0.02
65.93 -0.15
TotStInst
ValueInst
39.79 -0.15
Western Asset
...
CorePlusBdI 11.40
-0.6
-0.8
0.9
-3.4
-2.5
-3.3
-1.1
0.4
-2.0
-2.4
-0.1
-0.8
-1.3
0.2
0.2
0.4
1.7
-1.1
-1.1
-1.1
-0.8
-0.8
-0.8
0.1
0.1
-0.7
-2.4
-2.4
-2.4
0.9
-0.1
-0.1
-0.8
-3.4
-2.7
.
B10 | Friday, May 4, 2018
THE WALL STREET JOURNAL.
BANKING & FINANCE
Overturns
U.S. Investors Head Abroad Court
Fraud Conviction
BY MIKE BIRD
Of Former Trader
BY CHELSEY DULANEY
NORIKO HAYASHI/BLOOMBERG NEWS
Rising interest rates were
supposed to suck money back
into U.S. markets. In reality,
they are driving Americans to
invest overseas.
One key reason is because
the gulf between increasing
U.S. interest rates and negative rates in Europe and
Japan, a common technique of
using currency forwards to
hedge foreign-exchange risk is
basically paying investors to
take risk abroad. A currency
forward contract locks in an
exchange rate for the purchase
or sale of a currency on a future date.
“If you look at a U.S.-based
investor, they actually get a
significant yield pickup going
into Japan and Europe; it’s
very interesting from a flow
perspective,” said Jamie Fahy,
global macro strategist at Citigroup, who added that the
boost to returns could be one
reason that European stock
markets are outperforming the
U.S. this year. The total return
this year for the Stoxx Europe
600 is 0.3%, while the S&P 500
has declined 1.1%, according to
FactSet.
U.S. investors have poured
$78 billion into Japanese and
eurozone stock mutual funds
and exchange-traded funds in
the past year, according to figures provided by data firm
EPFR.
By contrast, the move in
currency forwards has made
the cost to hedge dollar investments exorbitant for European and Japanese investors.
Over the same period, eurozone and Japanese investors
pulled $160.8 billion more
than they invested from U.S.
stock funds.
In the past year, big U.S.
ETFs tracking Japanese and
eurozone stock markets have
increased significantly. Assets
held by the iShares MSCI
Japan and iShares MSCI Eurozone ETFs have risen 35% and
34%, to $14 billion and $21.3
billion, respectively.
Data from the U.S. Treasury
International Capital System
surveys, which cover a
broader group of investments,
are more striking. During the
year to January, U.S. holdings
of eurozone and Japanese
A common technique to hedge foreign-exchange risk is pushing investors into Japan and Europe.
Shopping Spree
U.S. investors are pouring into eurozone and Japanese stocks, while buying euros and yen in the
spot market and selling them in the forward market has become an increasingly profitable trade.
Year-over-year change in U.S. holdings of
eurozone and Japanese stocks
Return on a one-year currency forward
Yen-dollar
Euro-dollar
$1.0 trillion
4%
0.8
3
0.6
2
0.4
1
0.2
0
0
–1
–0.2
–0.4
–2
2013
’14
’15
’16
’17
’18
2010
’12
Sources: Treasury International Capital System (holdings); FactSet (return)
stocks increased at the fastest
rate in at least five years, rising by $1.124 trillion.
The mechanics of the currency forwards mean that a
U.S. investor can use $120.80
to buy €100 today, and then
use a forward contract to sell
that €100 for $124.60 in 12
months, a 3.14% return on the
initial expenditure, the highest
amount since the common
currency was launched in
1999.
In the interim, the investor
can use the euros purchased
to buy European stocks. The
Euro Stoxx index has a dividend yield of about 3.4%. Combined with the return from the
currency forward, that investment would return roughly
6.5% if the price of the stock
stays the same.
The return to a U.S. investor buying Japanese yen in the
spot market and selling it in
forward markets is roughly
the same. “You’re getting paid
not to take that risk, basically.
It’s an unusual scenario,” said
Thushka Maharaj, global multiasset strategist at JPMorgan
Asset Management.
There are other reasons for
U.S. investors to be optimistic
about European and Japanese
shares. In both markets, valuation metrics like price/earnings ratios suggest stocks are
less expensive than in the U.S.
The phenomenon is the
same reason that higher U.S.
bond yields aren’t encourag-
’14
’16
’18
THE WALL STREET JOURNAL.
ing international investors to
buy U.S. debt. Unless a buyer
wants to take additional risk
in the foreign-exchange market, U.S. Treasury bonds provide little to no additional
return compared with domestic government bonds for
Japanese and European investors.
On the flip side, it may
make sense for U.S. investors
to go abroad. “If you want to
buy a 10-year German bond
from the U.S., you can get
about 3.5%. They’ve got no
issuance issues, probably a
supportive central bank, no
inflation issues,” said Jon
Day, fixed-income portfolio
manager at Newton Investment Management.
Mr. Litvak appealed the
conviction. In late 2015, a federal appellate court threw out
parts of the case and ordered
the securities-fraud charges to
go before a new jury. During
the new trial, which took place
in early 2017, Mr. Litvak was
convicted on only one of the
10 counts of fraud he faced.
Throughout the case, Mr.
Litvak’s lawyers have argued
that his clients were sophisticated parties and the price he
paid for the bonds had little
impact on their decision to
purchase them. The attorneys
compared his techniques as no
more manipulative or harmful
than the fast-and-loose claims
of a used-car salesman.
The appeals court’s latest
decision hinged on evidence
regarding whether Mr. Litvak
was acting as a principal in his
A U.S. appeals court vacated the conviction of former
Jefferies Group LLC trader
Jesse Litvak, the latest turn in
a case that has spanned more
than five years and helped
usher in changes to sales tactics on Wall Street.
Mr. Litvak had been convicted of securities fraud related to the sale of residential
mortgage-backed bonds and
has been serving a two-year
prison sentence. But the U.S.
Court of Appeals for the Second Circuit on Thursday said a
district court “materially
erred” in admitting evidence
related to a trade cited in the
case against Mr. Litvak.
The court ordered Mr. Litvak’s release from prison. His
attorney couldn’t immediately
be reached for comment.
The question now is
whether the Justice Department would seek a new trial.
“We’re reviewing the decision
and have no further comment
at this time,” said Tom Carson, a spokesman for the Connecticut U.S. attorney’s office,
which prosecuted the case in
New Haven.
Mr. Litvak’s long-running
case became a symbol of a
government crackdown on
Wall Street practices and led
to changes at many firms,
from mandatory training to
heightened surveillance of
traders.
Mr. Litvak was first charged
in January 2013 with cheating
customers out of $2 million by
inflating the prices he said he
had paid for residential mortgage-backed bonds. This allegedly caused hedge funds and
other investors to overpay for
the bonds.
In March 2014, a jury found
Mr. Litvak guilty of violating
federal securities laws in a
case related to the government’s banking bailout, called
the Troubled Asset Relief Program. The program allowed
the Treasury Department to
authorize private money managers to use taxpayer funds to
buy some bonds.
The case became a
symbol of government
crackdown on Wall
Street practices.
own interest or as an agent for
a counterparty on the trade.
The appeals court wrote that
the district court had “materially erred in admitting evidence that the counterparty…mistakenly
believed
that [Mr. Litvak] was his
agent.”
The decision came on the
same day that David Demos, a
former bond trader and managing director at Cantor
Fitzgerald & Co., was found
not guilty in federal court of
fraud charges related to mortgage-backed securities prices.
Mr. Demos was indicted in
2016 on multiple counts of securities fraud in connection
with allegedly fraudulent
trades of residential mortgage-backed securities. In that
case, similar to Mr. Litvak’s,
the trader allegedly overstated
the price Cantor had paid in
order to coax customers to
pay a higher price.
JPMorgan Taps Professor for New AI Role
ALAN FREED/REUTERS
JPMorgan Chase & Co. is
investing further in artificial
intelligence.
The largest U.S. bank by assets said Thursday that Carnegie Mellon University’s head of
machine learning will join JPMorgan in a new role, head of
artificial-intelligence research.
In the position, Manuela
Manuela Veloso
Veloso, who is also a professor
at Carnegie Mellon, will build
on the bank’s existing work
applying machine learning
technology, according to an internal memo reviewed by The
Wall Street Journal.
JPMorgan’s budget on technology will be about $10.8 billion in 2018.
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technology in order to de-
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chain technology, big data,
machine learning and bots.
In 2017, JPMorgan used an
AI program known internally
as LOXM to execute trades
across its global equities algorithms business. The AI
technology executed client
orders by using information
learned from billions of past
trades. A trial in Europe in
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found it was more efficient
than the traditional methods
of buying and selling; it expanded to the U.S. and Asia
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Ms. Veloso, who will join
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liver a great client experience will continue to be a
major differentiator,” JPMorgan Co-President and CoChief Operating Officer Daniel Pinto wrote in his April
shareholder letter.
Mr. Pinto, also head of the
corporate and investmentbank unit, added that JPMorgan has assembled teams in
artificial intelligence, block-
UBS GROUP
Controlling Stake in
China Bank Sought
UBS Group AG became the
first foreign bank to seek a controlling stake in its mainland Chinese business under new rules,
days after China eased foreignownership restrictions.
UBS has applied to increase its
stake in Beijing-based UBS Securities Co. to 51% from roughly 25%,
the bank said Thursday. China’s
stock-market regulator said on its
website that it had received the
application Wednesday and would
review the request.
UBS didn’t disclose how
much the transaction could cost.
“China is a key market,” a
UBS spokesman said, adding
that the opening of China’s financial sector “represents great
opportunities.”
The Swiss bank had telegraphed its plan earlier this year.
The remainder of the venture is
owned by Chinese investors including Beijing Guoxiang Asset
Management Co.—controlled by
the Beijing government—Cofco
Group and China Guodian Capital
Holdings. After committing last
November to liberalizing restrictions in the financial sector, the
China Securities Regulatory
Commission last Saturday approved new rules.
Foreign banks and asset
managers, formerly limited to
49% stakes in joint ventures
with domestic partners, can now
own as much as 51%.
—Stella Yifan Xie
MARCIO JOSE SANCHEZ/ASSOCIATED PRESS
BY EMILY GLAZER
LITIGATION
SEC Seeks to Compel
Testimony by Jay-Z
The Securities and Exchange
Commission said it asked a
federal judge to order Jay-Z to
talk to investigators about the
sale of his Rocawear brand to
Iconix Brand Group Inc.
The SEC said Thursday the
New York rapper hasn’t complied
with a February subpoena
seeking his testimony. An
attorney for Jay-Z wasn’t
available to comment. Iconix
bought the rights to sell and
license Rocawear in March 2007
for $200 million. It later wrote
down the entire value of the
asset, the SEC said. The agency
sought the judge’s order through
an action filed in Manhattanbased federal court.
The SEC has been
investigating Iconix since 2015,
the year it restated financial
results for parts of the previous
two years, according to
regulatory filings.
—Dave Michaels
Apollo Posts Loss as Investment Income Slides
BY ALLISON PRANG
Apollo Global Management
LLC swung to a loss in the
first quarter after recording
just over $67 million in losses
from its investment activities.
The private-equity firm said
it lost $58.3 million, or 34
cents a share, compared with
a profit of $145.2 million, or
75 cents a share, for the yearearlier quarter.
The company reported an
economic net loss of $121 million, or 30 cents a share, compared with economic profit of
$331.6 million, or 82 cents a
share, a year ago. Economic
net income is a closely
watched measure of unrealized investment gains.
While management fees
rose to $286.7 million, total
investment losses were $137.2
million, which hurt Apollo’s
top line. Revenue plummeted
76% to $166.9 million.
At the same time, expenses
declined 38% to $214.9 million.
For the quarter, the company reported assets under
management of $247.4 billion,
up from $197.5 billion. Apollo
reported fee-generating assets
under management of $182.5
billion, up from $154.2 billion.
Distributable earnings, a
measure of cash profit available for payout to shareholders, were 46 cents a share,
down from 57 cents a share.
Apollo said private-equity
funds depreciated by 2.7%.
The firm attributed the
drop to public companies that
are part of its eighth fund.
That fund includes about 278
million shares of ADT Inc.,
which went public in January
at $14 but whose shares closed
Thursday at $8.28.
On Thursday, rival KKR &
Co. said it was going to convert to a corporation, a change
that looks more attractive to
private-equity partnerships
now that the corporate tax
rate has been lowered.
On Apollo’s conference call,
co-founder Josh Harris said the
firm is reviewing the merits of
such a move. As the market reacts to the announcements of
other firms, the perks of these
conversions could boost shareholder value, he said. However,
he called Apollo’s current
structure “tax efficient” and
said there would be a tax expense with a conversion.
After the company affirmed
it is weighing a conversion,
shares of Apollo rose $1.03, or
3.5%, to $30.67. They are up
16% over the past 12 months.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | B11
* *
MARKETS
Treasurys
Strengthen
After Soft
Price Data
For Cboe, Fervor Over Fear Cools
Concerns about the
reliability of volatility
trading dims investor
enthusiasm for VIX
BY SAM GOLDFARB
BY GUNJAN BANERJI
Treasury prices edged
higher after softer-than-expected eurozone inflation
data.
The yield on the 10-year
Treasury note settled at
2.946% on Thursday, compared with 2.964% Wednesday.
Yields, which
CREDIT
fall when bond
MARKETS prices rise, slid
after a report
showed
eurozone inflation in April was
0.7% excluding energy, food,
alcohol and tobacco. That was
below the 0.9% consensus
forecast and a challenge to the
view held by some investors
that improved economic
growth and rising inflation
will soon lead to much tighter
monetary policies outside of
the U.S.
“On the global front, the
feeling is that growth may not
be as strong as it was a couple
of months ago, and as a result,
inflationary pressures may not
be as strong,” said Gary Pollack, head of fixed-income
trading at Deutsche Bank AG’s
private wealth-management
unit.
Analysts also pointed to
other factors supporting
Treasurys. Adding to the
day’s downbeat economic
news, the Institute for Supply
Management said Thursday
that its nonmanufacturing index slipped for a third
straight month in April, falling to 56.8 from 58.8 in
March. There was also follow-through from events on
Wednesday when bond prices
rose as the Treasury Department outlined its debt-issuance plans and the Federal
Reserve released its latest
policy statement.
While the Treasury said it
would increase the size of debt
auctions in the coming quarter
to meet funding needs, its issuance projection was slightly
lower than some analysts had
anticipated. It also stuck to its
plan of focusing on short-term
debt issuance, keeping pressure off long-term bonds such
as the 10-year note, which analysts said could have sold off if
the Treasury had hinted at a
change in strategy.
Meanwhile, some investors
read the Fed statement as
slightly less hawkish than expected. Fed officials indicated they remain on track to
gradually raise interest rates,
but they reiterated that their
2% inflation goal is “symmetric,” a signal that they could
allow inflation to run a bit
higher than 2% without increasing the pace of rate increases.
The yield on the two-year
Treasury note, which is more
sensitive to interest-rate policy than the 10-year yield, settled at 2.482% Thursday, down
from 2.517% just before the
Fed released its policy statement.
Anxiety is back on Wall
Street. That should be good
news for Cboe Global Markets
Inc., the operator of the VIX
index of expected stock
swings, widely known as the
market’s fear gauge.
But Cboe shares have tumbled 15% this year, lagging far
behind both the broader stock
market and the firm’s peers.
Questions about the reliability
of volatility trading—punctuated by the one-day collapse
in February of volatility-linked
exchange-traded products and
a rarely seen wobble last
month that raised concerns
about possible manipulation—
are dimming enthusiasm for
the VIX just at the time when
it would seem most attractive.
The number of futures contracts outstanding for the
Cboe Volatility Index, or VIX,
has declined precipitously
since early February, despite
the market’s generally volatile
performance.
In addition, average daily
volumes slumped in April to
the lowest level in more than a
year, even as trading of futures and options in other
markets rose.
The declines have set the
stage for the Chicago-based
company’s quarterly earnings
and conference call, expected
Friday morning. Cboe needs to
restore investor confidence in
its ability to manage a historically lucrative business that is
turning out to be more complex than many anticipated.
“People thought that the
Cboe was a pure beneficiary of
higher volatility,” said Rich
Repetto, an analyst at Sandler
O’Neill + Partners. “It’s not
that simple.”
Still, he said he doesn’t see
the dip in VIX volumes as a
permanent impairment. He is
monitoring whether other
parts of Cboe’s business like
S&P 500 options and European
trading will offset declines in
the VIX complex.
Investors typically wager
that stocks like Cboe or highspeed trading firms like Virtu
Financial Inc. will profit from
higher volatility, said Mr.
Repetto. Virtu’s shares have
almost doubled this year. Exchange rivals like CME Group
Inc. and Nasdaq Inc. have
added 7.5% and 12%, respectively. Meanwhile, Cboe has
been the worst-performing
U.S. exchange operator.
“The growth outlook for
Cboe’s VIX futures remains a
critical question to the stock,”
wrote analysts from Goldman
Sachs Group Inc. in March.
A collapse in February of
two securities that used VIX
futures, as well as worries
about potential manipulation
in the index, have fomented
doubts about the ecosystem of
VIX products among traders.
The trends are a sharp reversal from 2017, when record
volumes in VIX futures and
options propelled Cboe shares
up 86% to a high in January of
this year. Even though markets
were quiet last year, VIXlinked products were popular
as traders and investors used
them to bet against volatility.
More than one-third of
Cboe’s revenue growth in the
two years through 2017
stemmed from trading in VIX
derivatives, according to Goldman Sachs.
“Cboe rode up this high-fee
product. And now they’re riding that back down,” said Mike
Bailey, director of research at
FBB Capital Partners, based in
Bethesda, Md.
Mr. Bailey said he hasn’t
bought shares of Cboe because its business is so concentrated in VIX products. He
owns CME shares.
Executive at
BofA to
Leave for
Silver Lake
ADEK BERRY/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY RACHEL LOUISE ENSIGN
AND LIZ HOFFMAN
Foreign investors pulled almost $400 million from Indonesian stocks last week, and the dollar topped 14,000 rupiah on Wednesday.
Indonesian Markets Take a Dive
BY ESE ERHERIENE
One of the biggest casualties of the rising dollar is the
emerging market of Indonesia,
which is seeing heavy selling
of stocks by foreign investors.
On Thursday, the country’s
equities benchmark logged its
third drop of at least 2.4%
since the middle of last week.
The JSX Composite Index
slumped 6.6% last week—the
most of any major index globally, according to FactSet, and
its worst week since August
2013. Foreign investors pulled
almost $400 million from equities. Sales in stocks of the
country’s biggest banks led
the selling, with the two largest each declining nearly 15%.
Through Thursday, the stock
index is down 7.8% this year.
Financials weren’t alone.
Bumi Resources, one of Indonesia’s biggest coal miners,
skidded 14% last week. But,
highlighting recent volatility,
the stock surged 16% Wednesday, and then fell 5% Thursday.
Selling has focused more on
the market’s most liquid stocks
rather than on sectors, said Felix Lam, a senior portfolio manager for APAC equities at BNP
Paribas Asset Management.
Indonesia has long been
one of the most sensitive
emerging markets to changing
U.S. financial conditions given
some 40% of the country’s
bonds are owned by foreign
investors, noted Frank Benzimra, head of Asia equity
strategy at Société Générale.
Bonds fared poorly as the
rupiah sold off in mid-April.
The yield on Indonesian 10year government debt climbed
to 7.2% from about 6.6% in
barely a week, as yields rise as
bond prices fall; it has since
pulled back to 7%.
“The hunt for high yields
makes the bond market attractive to foreign investors but
also makes it susceptible to periods of sharp outflows when financial conditions become less
conducive,” Mr. Benzimra said.
“This, in turn, is reflected in
movements in equities and FX.”
Worries about whether the
U.S. Federal Reserve will accelerate the pace of interest-rate
increases has also caused jitters among investors.
That helped weaken the rupiah as the dollar climbed to
2018 highs. On Wednesday, the
dollar briefly topped 14,000
rupiah for the first time since
January 2016.
Indonesia’s central
bank intervened in
currency and bond
markets recently.
Calling for calm, Indonesia’s
central bank staged a “sizable”
intervention in the currency and
bond markets last week, saying
it would remain in the market
indefinitely. The market tumult
has raised the prospect of Bank
Indonesia boosting interest
rates sooner than expected. It
could encourage some capital to
stay in the country. DBS Bank
and ING predict a rise may
come in the next several
months; prior consensus forecasts saw no action this year.
The market worries come
after the JSX index hit records
in 2017, rising 20%. It climbed
a further 3.9% in January but
has fallen 12% from its earlyyear peak.
In December, Credit Suisse
raised its recommendation on
Indonesian stocks to “small
overweight” from “underweight.” But the investment
bank said last week in a research note that the bullishness was “too early.”
Still, many observers don’t
believe the recent declines are
a harbinger of worse to come
as investors largely remain
bullish on the market.
Tuan Huynh at Deutsche
Bank Wealth Management highlights the relatively young age
of the country’s populace and
government reforms. While “investors hate uncertainty…medium to longer term I would still
regard Indonesia’s outlook as
the best in this region,” he said.
AJ Murphy, the head of
Bank of America Corp.’s capital-markets business and one
of the most senior women on
Wall Street, is leaving the
firm to join private-equity giant Silver Lake, according to
people familiar with the matter.
The bank announced Ms.
Murphy’s departure in an internal memo Thursday, which
was reviewed by The Wall
Street Journal and confirmed
by a bank spokesman. It said
she was going to work for a
client of the firm.
People familiar with the
matter said she would be a
senior executive at Silver
Lake’s main private-equity
fund, which focuses on big
technology companies and
counts Dell Inc. and Chinese
e-commerce firm Alibaba
Group Holding Ltd. among
its investments.
Ms. Murphy is expected to
start this summer and will focus on finding and structuring
new investments, advising
portfolio companies and potentially serving on boards of
directors on Silver Lake’s behalf, the people said.
Ms. Murphy leads Bank of
America’s global capital-markets business, which helps arrange debt and equity financing for companies. She joined
Bank of America in 2009 in its
leveraged loan business. She
left for a brief stint as a partner and senior banker at Goldman Sachs Group Inc. before
returning to Bank of America
in 2015.
Bank of America recently
ranked first in the debt capital markets league tables in
the U.S. and fifth in equity
capital markets, according to
first-quarter bank filings citing Dealogic.
The memo said the bank
would name a successor “in
the near future.”
Stocks Seek Direction as Blue Chips Recover From Plunge
BY MICHAEL WURSTHORN
AND RIVA GOLD
The Dow Jones Industrial
Average recouped a nearly
400-point plunge to end
slightly higher, a sign of the
stock market’s resilience despite indicaTHURSDAY’S tions of lackMARKETS
l u s t e r
corporate
earnings,
weakening economic data and
rising interest rates.
The blue-chip index has
struggled for direction, trading
in a relatively narrow range of
about 850 points over the past
month.
That
trend
continued
Thursday as the Dow industrials bounced back from a key
long-term technical level and
eked out a slight gain of less
than 0.1% to snap a four-session losing streak. The index
has fallen in nine of the past 12
sessions and remains down
10% from its Jan. 26 high.
The string of daily declines
appears to be taking a toll on
investors. Just 28% of individuals believe the stock market
will be up six months from
now, according to the American Association of Individual
Investors’s most recent weekly
survey, down from 37% the
previous week and below the
historical average of 39% going
back to 1987.
“This is a complicated
thing” for investors, said Barry
Bannister, head of institutional
equity strategy at Stifel Financial. “We have domestic and
geopolitical uncertainty, plateauing global growth…This is
good for stock pickers. It’s not
good for indexing.”
Several mediocre earnings
reports dragged on major indexes Thursday, and shares
came under further pressure
after data showed that the
pace of growth across much of
the U.S. economy slowed in
April.
The Dow industrials added
5.17 points to end at 23930.15,
after earlier sliding as much as
394 points. The S&P 500 declined 5.94 points, or 0.2%, to
2629.73, while the Nasdaq
Composite fell 12.75 points, or
0.2%, to 7088.15. Both the S&P
and Nasdaq have fallen for two
straight days.
The market has lacked a
clear leader since indexes tumbled into correction territory,
marked by declines of more
Treasury Sets Sales of $163 Billion in Debt
Technical Trading
THE WALL STREET JOURNAL.
The U.S. Treasury Department will auction $163 billion in
securities next week, comprising
$73 billion in new debt and $90
billion in previously sold debt.
Details (all with minimum denominations of $100):
Monday: $48 billion in 13week bills, a reopening of an issue first sold on Feb. 8, 2018,
maturing Aug. 9, 2018. Cusip
number: 912796PU7.
Also, $42 billion in 26-week
bills, a reopening of an issue
first sold on Nov. 9, 2017, maturing Nov. 8, 2018. Cusip number:
912796PD5.
Noncompetitive tenders for
both issues must be received by
11 a.m. EDT Monday and competitive tenders, by 11:30 a.m.
Tuesday: $31 billion in
three-year notes, dated May 15,
2018, maturing May 15, 2021.
Cusip number: 9128284P2. Noncompetitive tenders must be received by noon EDT Tuesday;
competitive tenders, by 1 p.m.
Wednesday: $25 billion in
10-year notes, dated May 15,
2018, maturing May 15, 2028.
Cusip number: 9128284N7. Noncompetitive tenders must be received by noon EDT Wednesday;
competitive tenders, by 1 p.m.
Thursday: $17 billion in 30year bonds, dated May 15, 2018,
maturing May 15, 2048. Cusip
number: 912810SC3. Noncompetitive tenders must be received
by noon EDT Thursday; competitive tenders, by 1 p.m.
up 9% this week, the broader
S&P 500 tech sector has added
just 1.2% over the same time.
Shares of Tesla slumped
$16.70, or 5.6%, to $284.45,
Thursday after the electric car
maker said it burned throughcash faster than expected, and
Chief Executive Elon Musk
sparred with analysts on a
conference call.
Besides concerns about
earnings, the Federal Reserve’s
plan to maintain its pace of
gradual rate increases, which
was reiterated Wednesday, has
forced investors to re-evaluate
their allocations between
stocks and bonds, while a
strengthening dollar has pressured U.S. multinational companies in recent weeks. Trade
concerns also continue to linger as the Trump administra-
tion has yet to complete implementing plans for its proposed
tariffs.
Also on Thursday, the Institute for Supply Management
said its nonmanufacturing index—tracking a wide range of
U.S. industries such as health
care, finance, construction and
agriculture—slipped in April
from March, missing economists’ expectations.
The Dow Jones Industrial Average erased an early decline
after bouncing back from its 200-day moving average.
24000
Performance, minute by minute
23900
23800
23700
23600
23500
9:30 10
Thursday
11
noon
Source: FactSet
than 10%, in early February.
Although 78% of S&P 500
stocks have topped earnings
expectations through the first
three months of the year,
stocks haven’t responded with
the same enthusiasm.
Apple’s
market-moving
power, for example, took a hit
this week after the tech giant
reported better-than-expected
earnings. While its shares are
1
2
3
4
.
B12 | Friday, May 4, 2018
THE WALL STREET JOURNAL.
* *
MARKETS
Retailers Make Strides as They Adapt
Turnaround efforts
appear to be paying
off, and investors
are taking notice
BY MICHAEL WURSTHORN
The year-to-date performance of all the components
of the S&P 500's consumer-discretionary sector.
S&P 500 consumer-discretionary
sector performance, year to date
10%
Auto components
Sector
Automobiles
5
Distributors
Diversified customer services
Investors are warming to
shares of department stores,
fast-food chains and apparel
retailers that have long sat in
Amazon.com Inc.’s shadow in
the S&P 500’s consumer-discretionary sector.
Struggling retailers such as
Macy’s Inc. and Target Corp.
have invested heavily in ecommerce and revamped
stores and inventory to improve their brick-and-mortar
operations. McDonald’s Corp.
has overhauled its low-price
value menu to entice customers back to its restaurants, and
Nike Inc. has focused on selling its products directly to
consumers and has overhauled
key brands like its Jordan line
of sneakers.
The yearslong turnaround
efforts suggest the companies
are making strides in adapting
to a changing marketplace
dominated by Amazon and remain viable businesses, at
least for now. Investors have
taken notice. Shares of Macy’s
have posted a double-digitpercentage increase this year
after sliding in 2017, while
Target and Nike are up 9% and
7%,
respectively,
and
McDonald’s has cut its losses
to 7%.
“Certain narratives tend to
dominate stock performance
longer than they should,” said
Kevin McCarthy, a senior research analyst with Neuberger
Berman, referring to Amazon’s
outsize influence. “People
aren’t taking that granular a
view of these names and
what’s going on.”
The retail rebound has
helped the consumer-discretionary sector outperform
most of the other segments in
the S&P 500 this year, with a
Email: heard@wsj.com
A Resurgent
CBS Flexes
Its Muscles
The embarrassingly public
melodrama between CBS, Viacom, and National Amusements, their holding company, over a possible merger
hasn’t done CBS shareholders any favors.
Since the beginning of the
year, the stock has fallen
15%. That drop reflects
shareholder anxieties, including concern about what
Viacom assets could do to
CBS and how much value
would be wiped out if Les
Moonves, chairman and CEO
of CBS, is forced out.
On Thursday, the company
recouped some of that loss
when it reported first-quarter earnings. Revenue for the
quarter set a record, increasing 13% to $3.76 billion, topping estimates of $3.64 billion. Earnings per share of
$1.34 beat analysts’ consensus estimate of $1.19 per
share. “CBS is operating
from a position of great
strength,” Mr. Moonves
boasted on a call with analysts. He promised record results for the year.
The company took special
care to emphasize the success of its streaming services, which are expanding
“while others are just entering this business.”
That dig may have been
aimed at Walt Disney, which
is planning to launch streaming services next year, taking
advantage of the content to
be gained from its acquisition of Fox assets. It may
also have been aimed at Viacom, to emphasize CBS’s superior strategy going into
the streaming future.
CBS’s message couldn’t
have been clearer. If the
company wants to rebuff Viacom and go it alone, it has
made the case abundantly
well. Sadly for them, it isn’t
their decision to make.
—Elizabeth Winkler
0
Chipotle
Hotels, restaurants and leisure
–5
Household durables
Excluding Amazon
and Netflix
Internet and direct marketing retail
Leisure products
Amazon
–10
Netflix
Jan.
Media
Feb.
March April
Specialty retail
Consumers are spending more
even though their incomes
have remained relatively flat.
Textiles, apparel and luxury goods
Change from a month earlier
Multiline retail
Macy’s
–50%
Amazon
Home Depot
Walt Disney
Comcast
Netflix
McDonald's
Nike
Booking Holdings
–25
0 Nike
25
50
1.0%
75
23.2%
6.5
0.6
4.6
4.4
4.1
4.0
3.4
3.2
Online retailer Amazon has
outsize influence over the
consumer-discretionary
stocks, with its nearly 25%
weighting in the sector.
0.4
0.2
0.0
0
2017
bump in share price.
Many companies in the sector are in the midst of multiyear turnarounds to overhaul
how they attract customers,
focusing their effort on direct
sales and on improving e-commerce. They have also gotten a
boost as the global economic
upswing that buoyed other
corners of the market eventually filtered down to consumers’ wallets.
Big hotel chains are expanding their inventory of
rooms, while cruise-line operators have modernized ships
and overhauled how they price
fares. Investors also are betting that consumers will continue spending on experiences
and luxury items, areas that
Amazon hasn’t been able to
fully penetrate.
“Luxury is no longer equal
’18
THE WALL STREET JOURNAL.
Sources: FactSet (S&P performance, weighting); Commerce Department (income and expenditures)
gain of 4.1%, versus a slide of
1.6% for the broader index.
Two stocks—Amazon and Netflix Inc.—are responsible for a
majority of that increase,
thanks to their respective
gains of 34% and 62%. But
even without their contributions, consumer-discretionary
stocks are outperforming
many other sectors in the index, including industrials, materials and consumer staples.
Of the companies in the
sector that have reported
first-quarter results, about
74% have topped analysts’ expectations, according to research firm FactSet. But some
of those stocks, including Hilton Worldwide Holdings Inc.
and Royal Caribbean Cruises
Ltd., have suffered from a
broader trend of investors not
rewarding those results with a
Personal income
Personal consumption
expenditures
0.8
to formality,” Tiffany & Co.
Chief Executive Alessandro
Bogliolo said on the jeweler’s
earnings call. “Luxury is no
longer predominantly for
richer…older people. Now, luxury is meaningful to a large
audience.”
Shares of Tiffany have
pared their decline this year to
1.6% since the company reported stronger-than-expected
earnings in mid-March.
More broadly, a tight labor
market, high levels of consumer confidence and a large
fiscal stimulus in the form of a
$1.5 trillion tax overhaul have
translated to higher spending
on indulgences such as designer handbags and Mediterranean cruises.
Many company executives
have expressed confidence
during their earnings calls
that the economy remains robust and that sales will continue increasing this year.
Mark Parker, president and
chief executive of Nike, told
investors there is strong demand for athletic footwear
and apparel in the U.S. and
elsewhere. In previous years,
Nike likely would have struggled to grab those customers,
but the company’s rejiggered
operations have put it on better footing, analysts say.
“We intensified the pace
and scale at which we’re
bringing fresh and unexpected
products to consumers,” Mr.
Parker said on the call, referring to new products such as
its Air Vapormax and Nike React shoe lines.
But some investors are still
unwilling to bet big on consumers. One reason is that
HEARD ON THE STREET
FINANCIAL ANALYSIS & COMMENTARY
Loan Investors Need to Be Careful
Demand for risky loans
that fund private-equity buyouts and other highly indebted companies has
pushed the size of the market beyond $1 trillion for the
first time. Investors should
be aware that rising interest
rates will make life harder
for borrowers.
Individual investors are
pouring cash into mutual
funds and exchange-traded
funds that invest in leveraged loans because their income rises as interest rates
go up. Bonds lose value as
rates rise. Leveraged-loan
funds have had nearly $5 billion of net inflows so far in
2018, according to Lipper.
However, higher rates eventually squeeze borrowers.
The loan market has
nearly doubled in size since
mid-2012, according to S&P
Global Market Intelligence’s
LCD research arm, and is expected to keep growing
strongly.
The market has almost
caught up with that for junk
bonds, which has shrunk to
Lever Up
Total volumes outstanding in U.S. risky bonds and loans*
$1.50 trillion
Bonds
1.25
1.00
0.75
Loans
0.50
0.25
0
2002
’04
’06
’08
’10
’12
’14
’16
’18
*As captured in ICE BofAML High Yield Index and S&P/LSTA Leveraged Loan Index
THE WALL STREET JOURNAL.
Sources: ICE; S&P Global LCD
$1.25 trillion from a peak of
$1.4 trillion in the past couple of years. Junk-bond
funds have suffered around
$10 billion of net outflows in
2018, according to Lipper.
Borrowers like loans because they can be repaid or
refinanced at any time and
are cheaper. At the same
time, covenants on loans—
which historically allowed
lenders to step in if a com-
pany began to get into difficulties—have been disappearing as investors became
less discerning. The upshot
is risky companies have refinanced maturing bonds with
loans, leading to a shrinking
junk market.
For investors, loans’ big
attraction is protection
against rising U.S. interest
rates because loans pay a
floating rate tied to an un-
derlying market interest
rate, known as Libor. Highyield bonds, in contrast, pay
a fixed coupon, so lose value
as rates rise.
However, rising rates will
bite eventually. Right now,
companies with leveraged
loans have plenty of earnings
before interest, taxes, depreciation and amortization relative to their interest costs.
According to UBS, this interest cover is more than three
times. But borrowers can
only withstand three more
rate rises before interest
costs start to become more
painful—and UBS expects six
increases by 2019.
The market is also riskier
than it was in 2007, according to LCD. While the cost of
loans is in a similar range,
more than half of borrowers
now are rated single-B-plus
or lower. In 2007, less than
one-third of the market was
that poorly rated.
The message for investors: A lot more caution will
be needed as the year goes
on.
—Paul J. Davies
companies are coping with
higher costs that are putting
pressure on profit margins.
Underwear maker Hanesbrands Inc. said Tuesday that
higher raw-material costs ate
into its profit margins in the
first quarter, even as the company topped earnings expectations. McDonald’s, which also
exceeded estimates, said Monday that it saw a jump in commodities costs. The same troubles plague the consumerstaples sector, which is made
up of businesses that sell necessities like diapers and detergent.
And other companies such
as Tapestry Inc., the parent of
Coach and Kate Spade, aren’t
seeing the same sales upswings as some rivals. Its
shares slumped after the company reported weaker sales at
Kate Spade and production delays at its Stuart Weitzman
brand, cutting Tapestry’s yearto-date gain to 4.2%.
“I don’t think we’re accelerating into a new extended or
higher sustainable level of
growth where the consumer is
going to be propelling us to
this significantly higher level
of growth,” Brian Levitt, a senior investment strategist at
OppenheimerFunds,
said.
“We’re probably going to hit a
little bit of a soft patch here in
economic activity.”
And while Commerce Department data show personal
spending picked up in March
after a slowdown earlier this
year, some analysts worry that
paychecks might not go as far
due to rising inflation. Others
warn that the recent jump in
interest rates could make it
harder for some Americans to
access debt, which could further limit spending.
Still, despite some fears
that synchronized global
growth is slowing, analysts
say it is more likely that
growth is on course to peak
before beginning a gradual decline over the next couple of
years.
WSJ.com/Heard
OVERHEARD
Accurately forecasting
stock-price moves is an extremely difficult exercise. One
way to improve your chances
of success is to have two different price targets at the
same time.
Analysts at Cowen accomplished that rare feat
Wednesday in a note about
Trupanion, a seller of health
insurance for dogs and cats.
In the first paragraph of their
note, the analysts lowered
their price target to $35 from
$38 after Trupanion reported
first-quarter results on Tuesday evening.
Read further down the
page however, and the situation becomes a little more
bullish. “Modest changes to
estimates, raise target price
to $38 from $32,” the analysts wrote.
Cowen analyst Thomas
Champion said that $35 is
the correct price target. Unfortunately for the Cowen
team, Trupanion shares are
going in the wrong direction.
They fell below $27 Thursday.
Phone Maker Xiaomi’s IPO Needs to Dial Back the Hype
A star of this year’s global
initial public offering
market, China’s Xiaomi, has
published its long-awaited
deal prospectus. And so the
key question follows: What
is this company, the world’s
fourth-largest smartphone
maker by volume, really
worth?
One thing is clear:
Nowhere near the $100
billion doing the rounds.
There is a reason Xiaomi
insists throughout its
prospectus that it is an
“internet company,” not a
hardware maker: An IPO
with sky-high valuations is
almost impossible for the
latter. So the document
focuses on Xiaomi’s potential
to grow rapidly in areas like
the Internet of Things, while
Dial Up
Global smartphone shipments,
quarter ended March 2018
Samsung
78 million
52
Apple
39
Huawei
Xiaomi
OPPO
28
24
Source: International Data Corporation
earning money from ads on
its apps and games.
The harsh reality is that
even last year—Xiaomi’s best
to date—its net income
amounted to only around
$700 million, excluding oneoffs. If investors decide that
Xiaomi really is just a low-
margin hardware company, it
could be worth as little as
$10 billion, based on historic
earnings multiples for peers
like Lenovo and Samsung,
which are no higher than the
low teens.
That might seem too low.
But even if Xiaomi were
perceived as more like
Chinese internet giants
Alibaba and Tencent, which
trade at almost 50 times last
year’s earnings, it could still
be worth close to only $50
billion, and that at a stretch.
Investors would need to have
a lot of faith in its growth
prospects for the valuation
to approach $100 billion.
So which is Xiaomi:
“innovation-driven internet
company” or hardware
maker? Just over 90% of its
$18 billion revenue last year
came from selling hardware,
mostly smartphones—a
barely profitable business.
Xiaomi’s gross profit margin
on its devices, which also
include rice cookers,
dehumidifiers and
televisions, was around 8%.
The company’s pitch is
that it prices devices
affordably to lock in users so
it can sell them services
such as virtual items in
mobile games and charge
advertisers more. The
margin from such services is
60%, and the gross profit
they generated last year
accounted for 40% of
Xiaomi’s total.
The problem is that
compared with other
internet giants, or even
other hardware leaders like
Apple, Xiaomi hasn’t built a
strong enough moat to keep
users within its ecosystem.
Phone shipments were up
75% last year, according to
IDC, largely because of an
impressive expansion into
India and Russia. But that
was after a 25% drop in
2016, a sign of how willing
cheap-phone buyers are to
switch brands. Another big
uncertainty is how well
Xiaomi services will sell
outside China, especially
when many buyers have
chosen its phones partly
because of the low price.
Xiaomi should follow its
strategy for selling smartphones, and price its IPO
much more affordably.
—Jacky Wong
Marcia Gay Harden
gives her mom
due credit M12
HOMES
|
MARKETS
|
PEOPLE
UPKEEP
|
VALUES
|
NEIGHBORHOODS
|
REDOS
‘To dwellers in a wood, almost every
species of tree has its voice as well
as its feature.’ —Thomas Hardy
|
THE WALL STREET JOURNAL.
SALES
|
FIXTURES
|
BROKERS
Friday, May 4, 2018 | M1
JASON HENRY FOR WSJ (3, TREE HOUSES); AXEL DUPEUX FOR WSJ (HARDEN); GORDON M. GRANT FOR WSJ (RENOVATION); FRANK URSO/DYNAMIC MEDIA (LONG ISLAND)
© 2018 Dow Jones & Company. All Rights Reserved.
|
MANSION
.
REDWOOD RETREAT Catherine New built a tree house for about $25,000 on family property in the Santa Cruz mountains and at times escapes there from her San Francisco office around an hour away.
Below left, a trapdoor opens onto a deck. Sliding glass doors lead to an airy room with wood flooring and a sleeping loft. Her dog, Wayne, below right, can’t climb the steep ladder and stays on the ground.
Tree Houses
For Grown-Ups
These leafy retreats are far from kids’ play,
with skylights, TV and air conditioning;
beware grumpy neighbors, falling acorns.
BY AMY GAMERMAN
WHEN JEFF AND MILLIE BAIRD bought a rugged 165-acre property in California’s Sonoma County in 2010, their goal was to spend more family time outdoors. So the first thing they built was a tree house: a honeycomb-like structure high in a towering live-oak tree, with decks, ladders and open-air “pods”
designed for animal-watching, sleeping, stargazing and wine tasting.
“You climb into the initial pod—the docking station. Then you climb up and
around. At the very top there’s an open deck in the canopy,” said Mr. Baird, a
44-year-old partner at a private investment firm, who spent about $65,000 on
Please turn to page M4
EXOTIC—AND CHAOTIC—MEDINA
The old city in the heart of Marrakesh, Morocco, tempts overseas
buyers with lavish, ornamented courtyard homes called riads.
FROM THE OUTSIDE, the
historic houses of the ancient Moroccan city of Marrakesh are deliberately modest and featureless. But to
step over the threshold of a
traditional riad is to enter a
world of vivid color and lavish ornamentation.
Tiled mosaic floors, walls
coated in polished “tadelakt”
plasterwork and enormous,
hand-painted cedar beams
are among the classic hallmarks of these homes, which
show off the quality of local
Please turn to page M8
BARNES INTERNATIONAL REALTY
BY RUTH BLOOMFIELD
MEDINA MANSION The courtyard of a five-bedroom, five-bathroom riad, which is on the market for just over $1 million.
INSIDE
LONG ISLAND
LISTING
Gold Coast
home seeks
$29.9 million
M2
$595,000
RENOVATION
A remodel
highlights a
couple’s art
M3
.
M2 | Friday, May 4, 2018
THE WALL STREET JOURNAL.
NY
MANSION
PRIVATE PROPERTIES
Longtime Malcolm Forbes
Townhouse Asks $28.5 Million
corner from the former Forbes
headquarters at 60 Fifth Ave. The
two buildings were previously connected, but the home’s current owners separated them after they purchased it, according to real-estate
agent Kyle Blackmon of Compass,
who has the listing with colleague
DAN ABRAMS PUTS GREENWICH VILLAGE CONDO UP FOR SALE
Dan Abrams, a television host,
entrepreneur and a self-professed
history buff, is listing his apartment in an 1830s-era Manhattan
townhouse for $8.799 million.
“I always loved the fact that
there was real history
there,” he said. The
founder of Abrams Media, which publishes
the media and politics website Mediaite
and others, Mr.
Abrams also co-authored a book on
Abraham Lincoln.
Located on Waverly
Place in the West Village, Mr.
Abrams’s condo encompasses the
first three floors of a Greek Revival townhouse, according to listing agent Cortnee Glasser of Sotheby’s International Realty. Mr.
Abrams created the roughly 3,300-
square-foot space by combining
two condo units. The home has
four bedrooms, a private garden
and four wood-burning fireplaces,
all of which Mr. Abrams said he
has used over the years.
Mr. Abrams’s home is
part of a seven-unit condominium that spans
two neighboring
townhouses. He
moved in as a renter
in 2004, he said,
then two years later
bought a three-bedroom duplex for $2.175
million. He bought the adjacent apartment in 2009 for
$1.645 million. The resulting unit
has two private entrances—one on
the parlor floor and one on the
garden level.
Mr. Abrams said he is selling
because his son is going to school
on the Upper West Side, and because he wants to be closer to his
offices farther uptown.
—Candace Taylor
STEEL HEIR LISTS LONG ISLAND GOLD
COAST ESTATE FOR $29.9 MILLION
An heir to the Phipps steel fortune is selling his sprawling estate on Long Island’s Gold Coast
for $29.9 million.
Known as Erchless, the Old
Westbury, N.Y., estate was built in
the 1930s for Howard Phipps, the
youngest son of Henry Phipps Jr.,
Andrew Carnegie’s partner in
Carnegie Steel. The seller is Mr.
Phipps’s son, also named Howard
Phipps Jr. Now 83, Mr. Phipps
wants to downsize, according to
real-estate agent Maria Babaev of
Douglas Elliman. Mr. Phipps declined to be interviewed.
The Colonial Revival-style
mansion is constructed in a Ushape, according to the listing.
Ms. Babaev said the estate is in
pristine condition, but the more
than 16,000-square-foot main
house, which has 15 bedrooms
and 12 bathrooms, has a “timecapsule” quality. The property,
which is over 90 acres, includes a
farm, stables, many out buildings,
a tennis court and staff housing.
On the north shore of Long Island, an area immortalized in
“The Great Gatsby,” Old Westbury is known for its gilded-era
estates and as a haven for horseback riding enthusiasts. It is also
home to Old Westbury Gardens,
which is open to the public and
whose home was built by another
of Henry Phipps’s children.
Ms. Babaev is co-listing the
property with agents from the
commercial real-estate brokerage
Newmark Knight Frank, who are
marketing the property separately as a redevelopment opportunity. Under current zoning, the
land could be split into 32 singlefamily lots that average over 2
acres each while maintaining 15
acres allocated to the main residence and gardens, according to a
statement from the firm.
—Katherine Clarke
ROBERT F. SMITH SPENDS NEARLY
$60 MILLION ON NEW YORK PENTHOUSE
Private equity executive Robert F. Smith was the buyer who
purchased a $59.058 million penthouse in New York’s Chelsea
neighborhood, according
to two people familiar
with the deal.
The transaction,
while short of Dell
Technologies
founder Michael
Dell’s record $100
million-plus penthouse
purchase in 2014, is still
one of the largest sales ever
recorded in the city.
The property, which is located
in the Peter Marino-designed
building known as the Getty at
West 24th Street and Tenth Avenue, is a combination of a twofloor penthouse apartment and an
additional floor downstairs for a
combined 10,000 square feet. It
has two master suites, four other
bedrooms, seven bathrooms, two
kitchens, two great rooms and a
private rooftop terrace. The deal
closed in late April, property re-
cords show.
The 12-story Getty has just
five homes and features an art
gallery and museum on the
lower floors, according
to its website.
Adam Modlin of
the Modlin Group
and Tal and Oren
Alexander of Douglas Elliman lead
sales at the building.
Mr. Smith is based in
Austin and is chief executive of Vista Equity Partners, a private-equity firm. He is
also the first African-American
chairman of the board of Carnegie Hall, replacing Ronald O.
Perelman in 2016.
Mr. Smith and his family own
additional homes in New York,
Malibu, Calif., and in their home
state of Texas, public records
show.
— Katherine Clarke
See more photos of notable
homes at WSJ.com/Mansion.
Email: privateproperties@wsj.com
PRIVATE BROKERAGE
The Dakota
Grand pre-war 8 room apartment with 4 rooms/60’ on Central
Park. 13.5’ ceilings, 3 wood burning fireplaces, 3 bedrooms,
2.5 baths, highest level of service and privacy. $12.5M.
Web 17752981. Sharon Walker Flynn 917.744.9693
The Right Broker Makes All the Difference.
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CLOCKWISE FROM TOP LEFT: EVAN JOSEPH/COMPASS; ZUMA PRESS; FRANK URSO/DYNAMIC MEDIA (2); SIMON DAWSON/BLOOMBERG NEWS; TRAVIS MARK; PAUL BRUINOOGE/GETTY IMAGES
A Manhattan townhouse owned
for decades by the family of Malcolm Forbes, the late chairman
and editor in chief of Forbes magazine, is returning to market for
$28.5 million after a renovation.
Built in 1847, the Greek Revival
townhouse is located around the
Leonard Steinberg.
Mr. Forbes, who
died in 1990 at age
70, was known for his
lavish lifestyle and
for broadening the influence of the magazine his family founded
in 1917. He bought the
townhouse in the early 1960s
and used it purely for entertaining
and hosting visiting celebrities
and dignitaries.
“Elaborate luncheons for CEOs
were a routine in the brownstone
house,” his son Steve wrote in
Forbes in 2017. “Each guest was
given an advertising pitch before
leaving.” Forbes sold its Fifth Avenue headquarters in 2010 and later
moved its operations to Jersey
City; the family sold the townhouse for $7.25 million in 2012 to
developers Todd Cohen and Terrence Lowenberg of Icon Realty
Management.
Messrs. Cohen and Lowenberg
gutted the Greenwich Village
house and revamped the interior,
giving the house a modern look.
The five-bedroom, roughly 9,600square-foot home has a doubleheight great room and two kitchens: one off the great room and
another on the ground floor with
access to the garden. A library
overlooking the great room has a
wet bar and leads to an 800-bottle
wine room. Messrs. Cohen and Lowenberg weren’t available for
comment.
The lower level, where Mr.
Forbes kept a wine cellar with its
own dining room, now contains a
soundproofed home theater, a gym
with rubberized floors and a
sauna.
—Candace Taylor
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M2A
NY / NE
READY TO SELL? LOOKING TO BUY?
I T ’ S
T I M E
F O R
E L L I M A N
1 Central Park South, 508/509 | $29,950,000 | 4-BR, 5.5-BA | Web# 3188668
140 East 65th Street | $12,500,000 | 5-BR, 6.5-BA | Web# 3232742
Dina Lewis O: 212.727.6129 Melanie Lazenby O: 212.727.6131
George Vanderploeg O: 212.891.7621 Steffen Kral O: 212.891.7293
825 Fifth Avenue, 7AB | $7,500,000 | 2-BR, 2.5-BA | Web# 2898176
60 White Street, 4E | $4,700,000 | 2-BR, 2.5-BA | Web# 3194705
Genevieve Sonsino O: 212.891.7140 Richard McTighe O: 212.891.7002
Leslie Mason O: 212.206.2810 Steve Halprin O: 212.206.2803
250 West 90th Street, 17JKI | $4,680,000 | 4-BR, 3.5-BA | Web# 2884528
1065 Park Avenue, 23AB | $4,500,000 | 5-BR, 4.5-BA | Web# 2798048
Eileen Foy O: 212.891.7284 Maria Elena Scotto O: 212.350.6818
Elizabeth (Lisa) Brown O: 212.319.5432
180 East 79th Street, 9D | $3,475,000 | 2-BR, 2.5-BA | Web# 3203933
139 East 66th Street, 7S | $2,950,000 | 3-BR, 3-BA | Web# 2814021
Pamela Kurtz O: 212.705.1063
Stephanie Kanter-Weisberg O: 212.891.7627
1035 Fifth Avenue, 8E | $2,450,000 | 3-BR, 3-BA | Web# 3151058
1050 Park Avenue, Medical Office | $549,000 | 2-BR, 2-BA | Web# 2563271
Nancy Aryeh O: 212.891.7160
Dianne Van Laer O: 212.891.7192
elliman.com/newyorkcity
NEW YORK CITY | LONG ISLAND | THE HAMPTONS | WESTCHESTER | CONNECTICUT | NEW JERSEY | FLORIDA | CALIFORNIA | COLORADO | MASSACHUSETTS | INTERNATIONAL
575 MADISON AVENUE, NY, NY 10022. 212.891.7000 © 2018 DOUGLAS ELLIMAN REAL ESTATE. ALL MATERIAL PRESENTED HEREIN IS INTENDED FOR INFORMATION PURPOSES ONLY. WHILE, THIS INFORMATION IS BELIEVED TO BE CORRECT, IT IS REPRESENTED SUBJECT TO ERRORS, OMISSIONS, CHANGES OR WITHDRAWAL WITHOUT NOTICE. ALL PROPERTY INFORMATION, INCLUDING, BUT NOT LIMITED TO
SQUARE FOOTAGE, ROOM COUNT, NUMBER OF BEDROOMS AND THE SCHOOL DISTRICT IN PROPERTY LISTINGS SHOULD BE VERIFIED BY YOUR OWN ATTORNEY, ARCHITECT OR ZONING EXPERT. EQUAL HOUSING OPPORTUNITY.
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M2B | Friday, May 4, 2018
NY / NE
Move to what
moves you
Halstead Agents are deal making,
future building, and will get you there.
New York City
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THE WALL STREET JOURNAL.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M3
NY
MANSION
BALANCE SHEET
Where Art Can Come Home
In the Hamptons, a retreat is designed around a couple’s art collection
BY LEIGH KAMPING-CARDER
COSTS
Kitchen
$43,000
Bathrooms
$20,000
Staircase, floors,
exterior deck
$64,450
Windows and
exterior doors
(including
installation)
$108,100
Demolition,
reframing,
insulation
$36,500
Electrical,
plumbing, HVAC
A BLANK SLATE Steven Sergiovanni and Chris Satek, below left and right,
designed their East Hampton home around their artwork. Clockwise from top
right: the Equitone-clad exterior; the living area has a minimalist design; the
owners; the all-white kitchen; the couple splurged on larger windows.
Sheetrock, taping,
architectural trim,
detailing
$16,800
Cleanup
$3,500
General contractor
fee
$71,000
Exterior cladding
$160,000
TOTAL
$595,450
even a little bold for us,” Mr. Sergiovanni said, half-joking.) On one
wall, she added her black-andwhite wallpaper with big, bold circles.
The couple, both tall and slim
and full of restaurant recommendations, splurged on expanding the
home’s windows. The four small
windows and sliding door in the
living room became a wall of windows, creating a “beautiful dialogue between raw, untamed forest
on the outside and this very
reined-in minimalist interior,” Mr.
ElHusseiny said. Windows and exterior doors totaled $108,100 including installation.
The designer kept costs down
by installing a sliding door in the
master bedroom instead of custom-ordering an oversize window.
Above it, a trapezoid-shaped window echoes the slanted roofline;
beside it, a porthole stands in for
what was once octagonal stainedglass in a lighthouse design. “It
wasn’t our aesthetic,” Mr. Sergiovanni said.
Another splurge was replacing
New Jersey’s Most
Beautiful Properties
SHORT HILLS, NJ
36 Stewart Road
•
•
•
•
$72,100
GORDON M. GRANT FOR THE WALL STREET JOURNAL (5)
STEVEN SERGIOVANNI and Chris
Satek spent years amassing art.
Unfortunately, living in a one-bedroom apartment in Manhattan’s
Chelsea neighborhood meant that
most of it sat in storage.
Then in May 2015, Mr. Sergiovanni, a 53-year-old art adviser,
and Mr. Satek, a 56-year-old
graphic designer, paid $650,000
for a three-bedroom, 1,600-squarefoot house in East Hampton, N.Y.
The following January, the longtime couple kicked off a roughly
one-year, $595,000 remodel that
turned the dated 1973 structure
into a minimalist retreat with expanded windows and wall space to
show off their collection.
“I don’t think I’ve ever designed
a house where we were quite literally building our design around the
artworks,” said Ahmed ElHusseiny,
founder of Brooklyn design firm
AE Superlab, who handled the design along with architect Brian
Masuda. In the end, all the artwork the couple owned fits, although some of it is still tucked in
a closet.
The couple couldn’t resist adding a bit more. They enclosed a
second-floor walkway that overlooked the living room and commissioned a site-specific wall
painting by Mary Temple, an artist
whom Mr. Sergiovanni used to
represent. On first glance, the pale
beige work looks like shadows of
tree branches; in fact, it is a
trompe-l’œil painting of the light
filtering through the windows.
Across the living room is a largescale wall piece commissioned
from Naomi Reis—an abstracted
riff on foliage in the Brooklyn Botanic Garden. The works cost
$30,000 and $20,000, respectively.
Sharing a love of minimalism,
Messrs. Sergiovanni and Satek
kept the stuff to a minimum, and
used white for much of the furniture, setting off the views of the
woods. In the kitchen, the highgloss cabinets and Caesarstone island, which together cost $28,000,
are also white.
The home includes a nod or two
to eclecticism. Bug-print wallpaper
by artist Jasmina Cibic papers the
lower-level bathroom, commemorating an early visit when the men
were astonished to see blankets of
June bugs on the window sills.
“I’m actually waiting for a bug to
be on there so I can Instagram it,”
Mr. Satek said.
In the master bedroom, interior
designer and friend Ghislaine Viñas departed from the monochromatic color scheme, re-upholstering a chair in pale blue. (“This was
cost of cedar shingles but does not
need regular, pricey treatments,
Mr. Satek said. “Over the long
term, we don’t have to replace it.
Or clean it. Or do anything,” he
said.
A few projects remain, including
the installation of an environmentally-friendly, nitrate-free septic
tank and the landscaping of the
nearly half-acre lot. But the couple
continues to marvel at the amount
of space.
“This is just like, oh my God, it’s
huge,” Mr. Sergiovanni said.
Whether it be a truly irreplaceable ranch under the bright blue skies of
Utah, a charming Cape Cod getaway, or luxurious equestrian estates
PlatinumLuxuryAuctions.com
800.262.5132
7 bedrooms
7.2 baths
9,188 sq. ft.
1.76 acres
what Mr. ElHusseiny called “pretty
terrible” vinyl siding with charcoal-grey Equitone, a low-maintenance, energy-efficient façade material that looks like a darker,
sleeker version of the shingle siding so common in the Hamptons.
Popular in Europe, the material
is so hard that it is tricky to modify on site, so the house had to be
measured by a laser to order the
façade. To add space for a light
fixture, the team had to use a diamond-tipped drill. The $160,000
cladding is also about 10 times the
in Florida and New Jersey, we’re confident you’ll enjoy purchasing
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$5,995,000
SHORT HILLS, NJ
296 Hartshorn Drive
•
•
•
•
5 bedrooms
6.1 baths
10,469 sq. ft.
1.34 acres
$3,650,000
M AY 2 6
P R E V I O U S LY
P R E V I O U S LY
R E S E R V E N O W AT
$13.9m $4m
570-Acre Trophy Ranch
S O U T H E R N U TA H
SHORT HILLS, NJ
12 Shirlawn Drive
•
•
•
•
6 bedrooms
7.1 baths
9,700 sq. ft.
0.65 acres
WELLINGTON, FL
M AY 1 9
CAPE COD, MA
M AY 2 9
NEW VERNON, NJ
JUNE 1
$3,088,000
CHATHAM, NJ
28 Rolling Hill Drive
•
•
•
•
6 bedrooms
5.2 baths
7,150 sq. ft.
0.69 acres
$3,095,000
Arlene Gonnella
#1 Agent in Short Hills-Millburn again in 2017!*
201-306-1357 (cell) 973-467-7576 (direct)
Arlene@gonnellateam.com www.GonnellaTeam.com
$8m
Creditor Confirmation
$2.5m
No Reserve!
$8m
No Reserve!
|
R E A L T O R S
*Source: GSMLS Statistics, 1/1/2017-12/31/2017.
Short Hills Office
973-376-4545
Wellington property offered by Douglas Elliman Realty. Listing agent Maria Mendelsohn (Lic#SL3207396). UT property offered by Summit Sotheby’s International Realty (Entity#6992527-0151). Listing Agent Kathy Mears (Lic#5464186-SA00). MA property
offered by Rand Atlantic Cape Cod Realty (ID#001207050). Listing Agent Priscilla Geraghty (Lic.#9056097). NJ property offered by Kienlen Lattmann Sotheby’s International Realty (Lic#0903100). Listing Agents Berly Teele (Lic#0559674) & Lisa Geoffroy
(Lic#1539382). Platinum Luxury Auctions is a licensed FL Real Estate Corporation (CQ1036963), licensed FL Auction Business (AB2956), and registered Foreign LLC with the states of UT (Entity#10748188-0161), MA (ID#001321209) & NJ (ID#0450234983)
performing auction-marketing services in these territories. Real estate brokerage services not performed where prohibited. Sotheby’s International Realty, the Sotheby’s International Realty logo & affiliate logos are registered (or unregistered) service marks used
with permission. Neither Sotheby’s, Sotheby’s International Realty Affiliates LLC, nor any of their affiliated companies is providing any product or service in connection with this event other than as required by applicable law.
.
M4 | Friday, May 4, 2018
THE WALL STREET JOURNAL.
NY
MANSION
Continued from page M1
the tree house in 2013. “We have a
dumbwaiter system with two pulleys up in the tree with ropes—we
can bring up a bottle in a bucket
and a few metal wine tumblers.”
The DIY tree fort is getting an
upscale makeover. Plywood twoby-fours have been replaced with
steel, hardwood flooring and polycarbonate skylights. Tree houses
with TVs, air conditioners and
tiled showers aren’t unheard of;
running water can be piped from
the home’s main line, or through a
pump system. Many tree houses
are even designed to be handicapaccessible. “People have spent
over $1 million,” said Pete Nelson,
who hosts the Animal Planet television show “Treehouse Masters.”
“I just got a call from a past client—they really want a spa tree
house, with a sauna and steam
room, and a hot tub,” he said.
If it is over 120 square feet, has
electricity from the grid or has
plumbing, a tree house usually requires a building permit. Zoning restrictions often cap the height to 20
feet off the ground—“making it
hard for the tree house to actually
be in the tree,” said Dustin Feider,
who built the Bairds’ aerie.
On large, secluded properties
such as the Bairds’, owners have
more freedom. But if the tree
house is going to be visible to
neighbors, proceed with caution.
“Grumpy neighbors equal treehouse kryptonite,” Mr. Feider said.
The Bairds, who live with their
two daughters in Oakland, were
looking for a way to camp out on
their land. “We are out in the wild
with pigs, bobcats, rattlesnakes. We
had the idea, ‘Hey, maybe if we are
10 to 15 feet off the ground,’ ” said
Mr. Baird. (He and Ms. Baird, 44, a
senior director at the Environmental Defense Fund, have since built a
modernist cabin on the property.)
Made of reclaimed Douglas fir
and sheet steel, the Bairds’ tree
house spans 20 feet of the live
oak, culminating in a star-shaped
platform in its canopy. A geodesic
sleeping pod was originally enclosed with white polyethylene
walls, until the Bairds removed
them; now they can see the stars.
To create the tree house, Mr.
Feider used Lidar remote-sensing
technology to laser-scan the oak,
then designed a three-dimensional
model. The tree house was built in
his O2 Treehouse workshop and
fitted into the oak with cables and
customized bolts that distribute
its weight across the branches.
“When the wind blows, the tree
house moves a little bit with the
tree—nothing that’s going to give
you seasickness, just a little sway
that’s super nice,” said Mr. Feider,
who sends tree climbers to clear
overhanging limbs before building.
“We’ve definitely had some adventurous nights when the wind
kicks up,” Mr. Baird said. “It actually hurts a little bit when you get
hit in the face with an acorn.”
FROM TOP: JASON HENRY FOR THE WALL STREET JOURNAL (4); DOROTHY HONG FOR THE WALL STREET JOURNAL (2)
TAPPING INTO TREE-HOUSE TRANQUILITY
OFF THE GRID Jeff and Millie Baird built a family tree
house in Healdsburg, Calif., with open-air ‘pods’ for animal-watching, sleeping, stargazing and wine tasting.
The tree house doesn’t have a
bathroom: To answer nighttime
calls of nature, the Bairds must
climb down with a headlamp or
flashlight and trek to the house.
There are other hazards.
“We had a hornet’s nest, which
attacked my kids,” said Craig
McDean, 54, a photographer and
filmmaker who built an octagonal
tree house overlooking the tennis
court of his East Hampton, N.Y.,
property. “I was always fascinated
with tree houses—having two sons
was a good excuse to do it.”
The tree house is built around a
white oak; the trunk runs right
through it, “like a mast with a
crow’s nest around it,” said Mr.
McDean, who paid about $60,000
to build the tree house in 2013.
Designer Roderick Wolgamott (formerly known as Roderick Romero)
said the cantilevered structure is
engineered not to harm the tree.
Inside, the tree house is snug,
with brass nautical-style light
sconces, reclaimed windows of wavy
glass and a vintage record player. It
is purposely low-tech. “If you put in
too many utilities, you’re just in a
house,” Mr. Wolgamott said.
“I’ve had eight to 10 people up
there—we have glasses of wine, we
play music,” said Mr. McDean.
A NEW LEAF Photographer and filmmaker Craig McDean paid about $60,000
to build his octagonal tree house on his property in East Hampton, N.Y.
His sons, ages 12 and 14, are
more likely to use the tree house
as an assassin’s tower during airsoft battles, he said, firing plastic
pellets at each other from up high.
Catherine New was seeking a
zen experience when she built a
tree house in the midst of a 6-acre
redwood-forest property that her
family owns in California’s Santa
Cruz mountains. Completed in January for about $25,000, it was designed by Mr. Feider.
The tree house perches above
the stump of a massive redwood
tree, logged sometime in the 19th
century. The 12-foot-by-8-foot platform is wedged in a cluster of
trees that grew up around the old
tree when it was felled.
To reach her tree house, Ms. New
climbs up a steep ladder and flips
up a trapdoor—secured from curious hikers with a lock—that opens
on a deck overlooking the forest.
Ms. New, 42, editor in chief of
Varo Money, a mobile-banking app,
in San Francisco, is planning to
build a second tree house nearby
to house a compostable toilet.
The tree house is about a 45minute drive from her home, allowing her to steal out there during the day to read, meditate, nap
or listen to music. “I was thinking
of putting a picture of my tree
house on my desk at work, so
when I get stressed out I could tap
into tree house mind,” she said.
The News You Need.
Straight to Your Inbox.
COLD SPRING HARBOR-LONG ISLAND
Breath-taking Victorian with sweeping lawns and yearround views of the Harbor. The 7,000 sf home, known as
Owl’s Cote, offers grand principal rooms with period details,
updates to meet todays lifestyles, and upgrades made to
structural integrity.
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2+ acres back NYS Greenbelt. Pool and pool house. Deeded
beach and Docking rights (Eagle Hill Dock). LOW TAXES!
Convenient to Village and train station. Less than one hour
by train to Manhattan.
$2,499,000 | ML# 3006883
Gil Picard | Licensed Associate Real Estate Broker
Cell: 516.768.4144 | gilbertpicard@msn.com
Cora Brettler | Licensed Associate Real Estate Broker
Cell: 631.793.1283 | cbrettler@signaturepremier.com
157 Main Street, Cold Spring Harbor, NY 11724 | 631.692.4800
© 2018 Dow Jones & Co. Inc. All rights reserved. 4DJ5979
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M5
Your best life b egins with a home that inspires you.
PA R A D I S E I S L A N D, BA H A M AS C O R O N A D O, C A L I F O R N I A
Ocean Club Estates. This grand 1.4 acre estate has
a 6 bedroom, 6.5 bath main house and 6 bedroom,
6 bath guest villa. 175 ft. of frontage on the Ocean
Club Waterway provides ideal docking for a variety
of boats. WEB ID: Z7TJ99. $15,995,000 US.
Nick.Damianos@SIR.com
One block to the beach. Indoor and outdoor living
spaces with an elevator to all 3 levels. Sweeping
views of the ocean to downtown from the roof deck.
Contemporary with all the elements of a luxury
coastal residence. 6 bedrooms, 4.5 baths.
$6,500,000. Scott Aurich.
GLEN ELLEN, CALIFORNIA PESCADERO, CALIFORNIA
Modern country estate with architecture that brings
the outdoors in. This is a 10± acre getaway perfect
for wine country escapists who relish outdoor life.
4 bedroom, 4.5 bath main house and guest house.
CalBRE # 01357054. $5,500,000. Donald Van de Mark.
Once in a lifetime opportunity for an oceanfront farm
property on 414 acres. Sweeping Pacific Ocean
vistas, lush, fertile farmland, barns, residences,
packing facility and unsurpassed privacy.
$24,950,000. Michael Dreyfus.
SAN DIEGO, CALIFORNIA
Damianos Sotheby's International Realty
+1 242.376.1841 | SIRbahamas.com
Pacific Sotheby’s International Realty
+1 619.987.9797 | PacificSothebysRealty.com
Sotheby’s International Realty
Wine Country Brokerage
+1 707.337.2227 | sothebyshomes.com
Golden Gate Sotheby’s International Realty
+1 650.485. 3476 | BolsaPoint.com
Pacific Sotheby's International Realty
+1 858.256.7005 | PacificSothebysRealty.com
SAN DIEGO, CALIFORNIA
SAN DIEGO, CALIFORNIA
SAN DIEGO, CALIFORNIA
SAN DIEGO, CALIFORNIA
S A N TA C R U Z , CA L I FO R N I A
Pacific Sotheby's International Realty
+1 858.256.7005 | PacificSothebysRealty.com
Pacific Sotheby's International Realty
+1 858.204.6226 | PacificSothebysRealty.com
Pacific Sotheby's International Realty
+1 858.204.6226 | PacificSothebysRealty.com
Pacific Sotheby's International Realty
+1 858.256.7005 | PacificSothebysRealty.com
Golden Gate Sotheby's International Realty
+1 650.485.3476 | CoastsideRanch.com
SONOMA, CALIFORNIA
SONOMA, CALIFORNIA
TIBURON, CALIFORNIA
DURANGO, COLORADO
MIAMI, FLORIDA
Sotheby's International Realty
Wine Country Brokerage
+1 707.337.2227 | sothebyshomes.com
Sotheby’s International Realty
Wine Country Brokerage
+1 707.337.2227 | sothebyshomes.com
Golden Gate Sotheby's International Realty
+1 415.517.7720 | globalestates.com
Legacy Properties West
Sotheby's International Realty
+1 970.391.2600 | legacypropertieswestsir.com
TA M PA B AY, F L O R I D A
L A K E F O R E S T, I L L I N O I S
BETHESDA, MARYLAND
BOSTON, MASSACHUSETTS CAPE COD, MASSCHUSETTS
Elegant 2 bedroom, 2.5 bath duplex across from the
Public Garden. Beautifully crafted with high ceilings,
crown moldings and oak floors. Features include a
chef’s kitchen, den and master suite with marble bath.
2 parking spaces. $3,199,000. Michael L. Carucci.
East Orleans.Waterfront - 2 acres. Renovated in 2017.
5 bedroom, 6 bath, 4,500+ sq. ft. home with timeless
appeal and stunning water views.Well-designed floor
plan with gourmet kitchen. Finished walkout lower
level, 2 fireplaces, security, outdoor shower, irrigation,
air conditioning. $2,500,000. Daneen Law.
Premier Sotheby's International Realty
+1 813.928.9795 | tampabaywinery.com
Jameson Sotheby's International Realty
+1 773.682.0546 | jamesonsir.com
TTR Sotheby's International Realty
+1 301.967.3344 | ttrsir.com
Gibson Sotheby's International Realty
+1 617.901.7600 | GibsonSothebysRealty.com
oldCape Sotheby's International Realty
+1 508.237.0977 | 204barleyneckroad.com
NEW YORK, NEW YORK
NEW YORK, NEW YORK
Luxury living on the water. An exquisite masterpiece
with waterfront views from La Jolla to Dana Point.
Sophisticated and inspiring, this Venetian-style
new construction embodies the finest attributes
of waterfront living. $8,800,000.
Clinton Selfridge and Eric Iantorno.
Nearly new and inspired by the best contemporary
architecture, this modern farmhouse offers light-filled
interiors, seamless indoor-outdoor living. Guest house,
pool, spa, wine cellar, garden. CalBRE #01357054.
$7,675,000. Donald Van de Mark.
Keel & Curley Winery offers a rare opportunity to
own a unique property and business. Situated on
36 acres, the property includes a winery, tasting
room, brewery, cidery, blueberry orchard, peach
and vegetable farm, owner’s residence and more.
$6,900,000. Crystal Dukes.
Magnificent bayfront home featuring private
dock access and panoramic views throughout.
Entertain and enjoy dining al-fresco on the back
patio as you watch the boats cruise by on the bay.
The ultimate coastal setting! $7,850,000.
Brett Dickinson and Eric Iantorno.
Antique roof tiles from Dubrovnik top this modern
Mediterranean nestled against Carriger Creek. Clean,
cream interiors open wide to a pool with spa. Nearly new
and high tech.A guest house completes the property.
CalBRE #01357054. $4,875,000. Donald Van de Mark.
Set on 2 acres just steps from Lake Michigan on a
coveted private street, this custom French Country
Manor offers over 10,000 sq. ft. of living space designed
for entertaining. Newer home features 8 bedrooms,
11 baths, designed gardens, a pool/spa, tennis court,
and a 4 car garage. $3,500,000. Erica Goldman.
Spectacular oceanfront views. The single level,
2nd floor condo features a wrap-around deck that
captures the panoramic views and blissful energy
of Horseshoe Beach. Walk to downtown La Jolla,
the Cove, museum and local cafes. $6,950,000.
Brett Dickinson and Eric Iantorno.
Stunning, 5 bedroom, 4 full and 2 half bath
classic-contemporary with gorgeous indoor/
outdoor spaces and San Francisco skyline
views features formal living/dining room,
chef’s kitchen and sparkling pool. $7,275,000.
Lydia Sarkissian, Magda Sarkissian and Bill Bullock.
Exquisitely sited on a private 1.5 acre with gated
entry, reflecting pool, separate heated swimming
pool and sensational cabana/pool house,
this one-of-a-kind French Country estate
boasts 20,000 sq. ft. of unparalleled design.
New price: $13,500,000. Marc Fleisher.
N E W T O N , M A S S A C H U S E T T S B R O O K LY N H E I G H T S , N E W YO R K N E W Y O R K , N E W Y O R K
Impeccably-maintained, custom-built, single
level estate with fabulous indoor and outdoor
living spaces. Resort-style living on 3.68 tranquil
acres located near the Rancho Santa Fe Golf Course
with direct Covenant trail access. $4,995,000.
Eric Iantorno and Clinton Selfridge.
This estate offers 32+ acres of the most captivating,
unblemished views of the San Juan Mountain range and
Electra Lake in a very private and pristine setting.The
11,700 sq. ft. home has 5 bedrooms, 6 baths, and is being
sold completely turnkey. $10,750,000.Zach Morse.
Exquisite and captivating Coronado property
situated on one of the largest waterfront lots
with over 65 ft. of bay frontage. The extraordinary
Santa Barbara/Spanish-style estate boasts
breathtaking harbor and downtown skyline views.
$14,495,000. Eric Iantorno and Clinton Selfridge.
175 acres of pristine wilderness, organic
farmlands, secluded beachfront, and a 19th
century farmhouse. One hour from Silicon Valley.
$35,000,000. Michael Dreyfus.
Waterfront 3-level townhome villa with 40 ft.
deeded dock in beachfront gated community with
tennis courts, pools, gym, spa, racquetball, restaurant
and more. 3,870 sq. ft., 4 bedrooms, 3 full and 2 half
baths. $1,800,000. Alexandra Peters-Rutten.
arutten@onesothebysrealty.com
ONE Sotheby's International Realty
+1 786.282.5290 | onesothebysrealty.com
A sophisticated 6 bedroom, 6 bath contemporary
Colonial located on 1.5 private acres in Chestnut Hill.
With 8,000 sq. ft. of living space, this light and airy
floor plan brings lots of natural light into the home.
$3,495,000. Michael L. Carucci.
Sprawling duplex penthouse boasting 4 bedrooms,
3,201 indoor sq. ft., 2,028 outdoor sq. ft., park, river,
Brooklyn Bridge and city views at Pierhouse.$7,295,000.
Karen Heyman. Karen.Heyman@sothebyshomes.com
Alan Heyman. Alan.Heyman@sothebyshomes.com
A key to Gramercy Park. Move right in to a full
floor condo with an abundance of windows,
direct park views and custom designed upgrades.
$19,250,000. Nikki Field and Amanda Field Jordan.
nikki.field@sothebyshomes.com
845 United Nations Plaza.Arare combination of three
apartments that have been combined,prepped,ready
for renovation.$11,750,000.Elizabeth Lee Sample.
elizabeth.sample@sothebyshomes.com and
Brenda S.Powers. brenda.powers@sothebyshomes.com
Superb Manhattan views of the East River, Central Park,
Chrysler Building and Midtown. Located on the entire
37th floor of top condominium.Approx 4,000 sq. ft.,
4-6 bedrooms, 4 terraces. Mint condition. $8,995,000.
Louise C. Beit. louise.beit@sothebyshomes.com
Gibson Sotheby's International Realty
+1 617.901.7600 | GibsonSothebysRealty.com
Sotheby's International Realty
Downtown Manhattan Brokerage
+1 646.431.5764 | sothebyshomes.com/01310075
Sotheby's International Realty
East Side Manhattan Brokerage
+1 212.606.7669/7798 | sothebyshomes.com/00112114
Sotheby's International Realty
East Side Manhattan Brokerage
+1 212.606.7685/7653 | sothebyshomes.com/00112127
Sotheby's International Realty
East Side Manhattan Brokerage
+1 917.544.5515 | sothebyshomes.com/00112137
NEW YORK, NEW YORK
NEW YORK, NEW YORK
H I G H L A N D S , N O R T H C A R O L I N A W A R W I C K , R H O D E I S L A N D W E S T E R LY, R H O D E I S L A N D
With a hat-tip to the grand, meticulous and storied
architectural wonders of Scotland, this hybrid mix of
arts and crafts and manor style creates a glamorous
mountain home on the Highlands/Cashiers Plateau
of Western North Carolina. $4,950,000. Jody Lovell.
Sotheby's International Realty
East Side Manhattan Brokerage
+1 212.606.7704 | sothebyshomes.com/00112133
Sotheby's International Realty
Downtown Manhattan Brokerage
+1 212.431.2427 | sothebyshomes.com/01310256
Award-winning English Manor country estate
on 13 park-like acres. The meticulously renovated
1933 Georgian Revival home is built of amazing
grey 18-inch block stone, with lead-coated
copper gutters, a slate roof, in-ground pool
and pool house. $1,595,000.
Champlin Woods is a vibrant adult community
conveniently situated between the Rhode Island
coastal resort villages of Watch Hill and Weekapaug.
These upscale residences located near golf, tennis,
and beaches offer an active resort lifestyle.
Price upon request.
Highlands Sotheby's International Realty
+1 828.226.6303 | highlandssothebysrealty.com
Mott & Chace Sotheby's International Realty
+1 401.884.5522 | mottandchace.com
Mott & Chace Sotheby's International Realty
+1 401.315.0808 | mottandchace.com
CHARLESTON, SOUTH CAROLINA AU ST I N , T E X AS
8,260 sq. ft. lakefront estate with custom features
including pool, outdoor kitchen, cabana, home gym.
Master suite with fireplace, private balcony. Smart
Home Technology. Elevator. 5 bedrooms, 5 full
and 3 half baths. $4,695,000. Dan Ravenel.
DRavenel@DanielRavenelSIR.com
Soft contemporary masterpiece recently renovated
sitting on 1.63 flat acres close to Westlake with
beautiful city views. Over $1M was added in
gardens and landscape design. Stunning wine
cellar with a 2,500+ bottle capacity. $6,995,000.
Kumara Wilcoxon. kumara@sothebysrealty.com
AUSTIN, TEXAS
Exquisite contemporary designed to showcase
unparalleled views of Downtown Austin and Lady Bird
Lake and provide gracious space for entertaining.
Columnist Michael Barnes called it“jeweled glass
box on the hill overlooking the city.” $6,950,000.
Kumara Wilcoxon. kumara@sothebysrealty.com
AUSTIN, TEXAS
Thoughtfully designed by Steve Kubenka, this home
is truly one-of-a-kind. Designed to look as if it was
built in the 20’s or 30’s, perfectly tying the home
into the Old Enfield neighborhood style. $4,175,000.
Kumara Wilcoxon. Kumara@sothebysrealty.com
AUSTIN, TEXAS
Daniel Ravenel Sotheby's International Realty
+1 843.343.5944 | Danielravenelsir.com
Kuper Sotheby's International Realty
+1 512.423.5035 | 102Skyline.com
Kuper Sotheby's International Realty
+1 512.423.5035 | 1404WildCatHollow.com
Kuper Sotheby's International Realty
+1 512.423.5035 | 2307windsor.com
Kuper Sotheby's International Realty
+1 512.423.5035 | 4017veranodr.com
White-glove West Side prewar cooperative distinguished
by its superb scale, fine original architectural detail,
southern and western sunlight,views of Central Park and
NewYork City skyline. $5,600,000. Roberta Golubock.
roberta.golubock@sothebyshomes.com
Encompassing 2,168 sq. ft, this 3 bedroom, 2.5 bath
duplex features soaring ceilings,wrought-iron columns
and the highest quality fixtures/finishes.$4,495,000.
Jeremy Stein. jeremy.stein@sothebyshomes.com
Jennifer Henson. jennifer.henson@sothebyshomes.com
© MMXVIII Sotheby’s International Realty Affiliates LLC. a Realogy Company. All Rights Reserved. Landscape with House and Ploughman, used with permission. Sotheby’s International Realty® is a
registered trademark licensed to Sotheby’s International Realty Affiliates LLC. An Equal Opportunity Company. Equal Housing Opportunity. Each Office is Independently Owned and Operated.
Absolutely breathtaking one story contemporary
with an organic feel. This 5 bedroom home
is an entertainer’s dream, located on a
beautifully landscaped 2 acre lot with
a very private feel. $3,495,000.
Kumara Wilcoxon. kumara@sothebysrealty.com
sothebysrealty.com
.
M6 | Friday, May 4, 2018
NY
THE WALL STREET JOURNAL.
MANSION
ELEMENTS
POD PEOPLE
GO UPSCALE
“SHED” IS A NOT A WORD that telegraphs a high sense of style.
But today, designers and fashion-conscious builders are offering
what they call studio sheds, or prefabricated one-room structures,
that appeal to the architectural aesthete.
Many of these sheds are small enough that they allow homeowners to bypass local ordinances requiring permits for additional
structures on their lots. Unlike “accessory dwelling units” that
have bathrooms and kitchens, these stand-alone rooms are typically used as home offices, playrooms or hobby spaces for yoga,
music or meditation.
Some companies deliver the sheds fully built. The buyer just
plugs them in for lighting and ventilation. Other companies offer
the option of having them build it on site, or shipping the components so the customer can assemble it or hire someone to do it.
Here’s a look at three companies that are helping sheds to shed
their lowbrow reputation.
—Katy McLaughlin
CLOCKWISE FROM TOP: STUDIO SHED; JUDY BERNIER; DAVID EPHRON
Studio sheds, or pods, introduce small but
sophisticated architecture into the backyard
GLASS WITH CLASS
Jeremy Nova, co-founder of Studio Shed, based in Boulder, Colo., was working as a professional mountain-bike
racer in 2006 when he built a “high-design storage shed”
for his household’s 20-or-so bikes, he said. Friends begged
for their own spaces, which convinced him and a partner
to launch their own business in 2008. Studio Shed has
grown by 30% to 50% for each of the past five years, he
said. It now offers four varieties of prefabricated sheds
that customers can assemble or that the company will
build for them. The most popular model: a one-room
space typically used for a home office has a flat roof, big
windows and glass doors.
Price: $25,000 to $30,000, installed; unit includes drywall, insulation, LED lighting, hardwood floors
HOBBIT HANGOUT
MINI-MIDCENTURY
David Smith, owner of Backyard
Eichler, Novato, Calif., designs and
builds sheds in the classic style of
postwar California real-estate developer Joseph Eichler. Mr. Eichler specialized in affordable modern architecture. Mr. Smith’s sheds have flat
roofs, transom windows, exposedbeam ceilings and lots of light, he
said. About one-third of his customers also have Eichler homes;
most of the rest have modern or
contemporary houses, he added. Mr.
Smith started the company in 2010.
In his region, the company recommends installers and inspects the
process; farther afield, buyers get
panels and hire their own builders.
Price: Starts at $19,500 with installation; unit includes a 10- by 12-foot
sliding glass door, transom windows, insulation, electrical wiring
The only U.S. owner of the
shingled, hobbit-house looking
Archipod is Judy Bernier.
Trained as an architect, and
after a long career as an interior designer, Ms. Bernier was
looking for an attractive studio
shed when she stumbled
across this design from Britain. The Archipod’s designer
told her he didn’t export and
that if she wanted one, she
would have to become the
U.S. distributor. In 2015, she
opened Podzook in Waldoboro,
Maine, and hired local shipbuilders to create a prototype.
Price: $17,000 to $25,000,
delivered fully built; unit has
reclaimed-wood floors, radiant
heat, a built-in work surface
In th
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Morris Ad
Estimated Occupancy Summer 2018.
Offering over 3,000 square feet of living space, each three to four bedroom residence has been carefully
designed to enjoy multiple exposures through oversized coffered windows. Every full-floor home features
private elevator access, ceilings over 10-feet and handcrafted kitchens by Smallbone of Devizes with
integrated Miele appliances. Building amenities include an attended lobby, fitness center, common roof
terrace with kitchen and private storage.
The Cathy Franklin Team
212.323.3236 | 116university.com
Pricing starting at $7,200,000
The complete offering plan is available from the Sponsor. File No. CD16-0087. Equal Housing Opportunity.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M6A
NY
Special Advertising Feature
COURTESY OF HOULIHAN LAWRENCE
WESTCHESTER AND
FAIRFIELD COUNTIES
The City’s Always Hot,
But Life In the
Suburbs Is Cool Again
Brisk Market Offers
Opportunities in
Westchester, Fairfield
Residents Love
The Lifestyle
Variety Here
Year-Round
Recreation on Land
And on Water
A WIDE RANGE OF ACTIVITIES,
VARIED LIFESTYLES AND EASY
COMMUTE—WHAT’S NOT TO LIKE?
YOU CAN OPT TO BE A HERMIT OR
A SOCIAL BUTTERFLY—OR BOTH
THE PROPERTY MARKET REMAINS
STRONG BECAUSE OF THE RANGE
OF ACTIVITIES AVAILABLE
The Wall Street Journal news organization was not involved in the creation of this content
.
M6B | Friday, May 4, 2018
THE WALL STREET JOURNAL.
NY
114 BEACHSIDE AVENUE, WESTPORT, CT
50 CROWS NEST, BRONXVILLE VILLAGE, NY
3 ELM ROCK ROAD, BRONXVILLE VILLAGE, NY
$28,000,000 I 7 Beds I 7.2 Baths I 8,482 Sq. Ft.
Magnificent 7.7 Acre Waterfront with 365’ Sandy Beach
Victoria Fingelly 203.610.0647
$6,900,000 I 9 Beds I 5.1 Baths I 10,442 Sq. Ft.
Architectural Masterpiece I Stunning 1.36 Acres
Kathleen Collins 914.715.6052
$6,500,000 I 5 Beds I 4.1 Baths I 5,985 Sq. Ft.
Prestigious Elm Rock Estate I Private Setting
Kathleen Collins 914.715.6052
1093 PEQUOT AVENUE, SOUTHPORT, CT
1480 PONUS RIDGE, NEW CANAAN, CT
35 MURRAY HILL ROAD, SCARSDALE, NY
$5,300,000 I 5 Beds I 4.1 Baths I 4,365 Sq. Ft.
“Southport on the Sound” with 200’ Water-frontage
Victoria Fingelly 203.610.0647
$4,975,000 I 6 Beds I 6.2 Baths I 10,250 Sq. Ft.
Gated Custom Built Estate I Stunning Property with Views
Inger Stringfellow 203.321.9361
$4,250,000 I 5 Beds I 4.1 Baths I 5,036 Sq. Ft.
Estate Area 1 Acre I 2017 Renovation “Smart House”
Mary Katchis 914.419.8041
55 FIELD TERRACE, IRVINGTON, NY
4 WATSON COURT, RYE, NY
11 SKY MEADOW FARM, PURCHASE, NY
$3,995,000 I 7 Beds I 5.2 Baths I 4,864 Sq. Ft.
Stately Brick Colonial on 3 Acres I Gorgeous Pool
Frances Zweiben, Nancy Steinberg 914.393.2583
$3,950,000 I 6 Beds I 4.1 Baths I 5,122 Sq. Ft.
Golf & Water Views I Deep Water Dock
Laura DeVita 914.473.1439
$3,850,000 I 6 Beds I 7.2 Baths I 9,489 Sq. Ft.
Sexy and Sophisticated I No Expense Spared
Wendy Alper 914.806.6868
12 ORCHARD PLACE, BRONXVILLE VILLAGE, NY
130 POLLY PARK ROAD, RYE, NY
370 MANSFIELD AVENUE, DARIEN, CT
$3,695,000 I 5 Beds I 6.1 Baths I 4,418 Sq. Ft.
Traditional Elegance I Large Private Property
Kathleen Collins 914.715.6052
$2,995,000 I 6 Beds I 7.1 Baths I 7,567 Sq. Ft.
Open and Inviting I All-Season Entertaining
Wendy Alper 914.806.6868
$2,986,000 I 5 Beds I 3.2 Baths I 6,626 Sq. Ft.
1905 Manor House I Dramatic Contemporary Renovation
Andrea Kostanecki 203.858.3553
1069 BAYHEAD DRIVE, MAMARONECK, NY
63 PARK STREET, NEW CANAAN, CT
18 PINE RIDGE ROAD, WILTON, CT
$2,685,000 I 6 Beds I 6.1 Baths I 4,816 Sq. Ft.
Magnificent Renovated Colonial I Near L.I. Sound
Anne Feuga 914.714.5049
$2,600,000 I 3 Beds I 4 Baths I 5,450 Sq. Ft.
Live & Work I In-Town Professional Building I 8 Employees
Inger Stringfellow 203.321.9361
$1,385,000 I 5 Beds I 4.2 Baths I 7,482 Sq. Ft.
Stately Center Hall Colonial I Level Yard with Putting Green
Brian A Clarke Jr., Leigh Ann Lengyel Clarke 203.246.4771
williampitt.com
juliabfee.com
Each Office is Independently Owned and Operated. Equal Housing Opportunity.
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M6C
NY
Special Advertising Feature
WESTCHESTER AND FAIRFIELD COUNTIES
Brisk Market Offers Opportunities
In Westchester, Fairfield
A
long-outdated narrative
states that Fairfield County,
Conn., and Westchester
County, N.Y., are too far from
the fun of New York. That
story never was true, and today it’s less
accurate than ever. The commute into the
city is generally faster and more efficient
than it was a generation ago, and the local
amenities and recreational options will
keep you happy if you’d rather not venture
far from home.
COURTESY OF HOULIHAN LAWRENCE
By Joseph Dobrian
COURTESY OF HOULIHAN LAWRENCE
A WIDE RANGE OF ACTIVITIES, VARIED LIFESTYLES AND EASY COMMUTE—WHAT’S NOT TO LIKE?
GOOD VALUE
“IT’S EASY TO BLEND OUTDOOR
LIFE WITH COMMUTING AND
DOING YOUR WORK.”
you can go and not see anyone. We have
skating rinks in the winter; there’s the
wonderful walkability of our villages
and towns. You can go kayaking in the
Hudson River; you can join a crew club;
you can take a short walk to a restaurant
or bar just like in the city, but in a more
convivial atmosphere. It’s easy to blend
outdoor life with commuting and getting
your work done.”
Ms. Murphy notes the vibrant life mix
in river towns such as Tarrytown,
Hastings-on-Hudson, Ardsley, Irvington,
and Port Chester, which offer a great
Waterfront communities offer a vibrant oasis for homeowners seeking private beaches, docks, swimming, fishing, or just a saltwater breeze.
blend of outdoor and cultural lifestyles,
with lots of activities for families.
“Towns and villages have naturalists
who offer walks where they identify
plants; the community pools that charge
low admission are another attraction—
plus there are terrific country clubs with
all kinds of amenities.”
Ms. Murphy is currently offering
25 Pine Lane in Cortlandt Manor, an
immaculately maintained home priced
at $585,000, close to protected wetlands
and the train station.
“You have the sense that you’re in a
small country house but with ready
access to the city,” she explains. “I have
another priced at $749,000, coming on in
Hastings-on-Hudson, with a generous
yard and an old-time aesthetic to it: a
picturesque, classic American house
that can grow with modern tastes.”
stations; the commute is less than
an hour to Grand Central Terminal.
“The average commuter is comfortable with that 40-mile commute
to Manhattan, because smartphones
enable productive connectivity on
the train.”
Bonnie Hut Yaseen, a Scarsdale,
N.Y.-based broker at Houlihan Lawrence,
testifies that the two counties can offer a
shorter commute than from Manhattan’s
Upper East and West Sides.
“It’s the easy lifestyle that propels a
move to the suburbs and keeps people
happy once they’re here,” she says.
“The city of Rye, located on Long Island
Sound, is often one of the first places
they look. It’s just 25 miles north of
Manhattan, and features a 62-acre town
park along the waterfront.
“I have a listing at 920 Forest Avenue
in Rye that’s a five-bedroom, five-bath
home on an acre on Milton Point. It’s
a 1968 classic colonial, offered for
$2,850,000, a stone’s throw from the
park. Its open floor plan is perfect for a
STRONG INVENTORY
An equally impressive menu of
activities, and a strong inventory of
available housing, awaits in Fairfield
County, with its assortment of larger
towns, villages, and more remote areas.
Larry Palma, Stamford, Conn.-based
broker for William Pitt Sotheby’s, is
highlighting his listing at 55 Cook Road,
located within the Davenport Point
Association in Stamford.
“Davenport Point Association, along
with Dolphin Cove and Southfield Point
Association, form the Waterside section
of Stamford, along Long Island Sound
on the Greenwich border,” he explains.
“These three waterfront communities
offer a vibrant oasis for homeowners
looking for private beaches, deep-water
docks, paddle-boarding, tennis, swimming, fishing or just an evening stroll
with a saltwater breeze at your back.
They’re a short distance to either the Old
Greenwich or downtown Stamford train
quick update, or can be added on to,
given the size of the lot. It’s bright, has
great flow, and offers the room count
that many buyers are looking for at over
4,500 square feet. The quiet lot is private,
level, and surrounded by specimen trees.”
Mamaroneck similarly hugs the Long
Island Sound and is adjacent to Rye.
Ms. Yaseen has a listing there directly
on the water at 1350 Flagler Drive,
offered at $3,250,000.
“This is a rare treat in that it offers
open water access and a private heated
pool on 0.42 acres,” she says. “It’s a
four-bedroom, four-bath colonial with a
wall of windows overlooking Long Island
Sound. It’s located in a private gated
community, with a community dock
and a large sandy beach for all residents.
“If it’s golf and swimming you like,
Scarsdale might be for you. It’s also
a quick commute to Midtown, and
has a golf course open to the public
and adjacent to the Scarsdale Pool.
Scarsdale Village also offers a yearround farmers’ market.”
PHOTOS BY BRYAN HAEFFELE
Moreover, home buyers can find a
surprisingly wide range of prices in
these two counties, and good value.
You can find a very nice home for well
under $1 million, or an amazing estate
with acreage if you care to spend the
money. You can create the lifestyle you
want, whether you prefer a town, a
suburban environment, or a remote,
semi-rural experience.
“What I love best about Westchester
is the blend of activities we have here,”
reports Irvington, N.Y.-based broker
Jessica Murphy, of Julia B. Fee Sotheby’s
International Realty.
“We offer health and fitness, arts and
leisure, dining and entertainment.
Westchester is a hot market in general,
now, and I do a lot of work in the river
towns, especially. The Old Croton
Aqueduct trail, which stretches up from
the Bronx for about 22 miles, is a great
attraction, as is Rockefeller State Park
Preserve, where you can find stretches
of hiking and equestrian trails where
This home, at 55 Cook Road, is located withing the Davenport Point Association in Stamford.
NORTHERN WESTCHESTER SECOND-HOME
MARKET CONTINUES TO GROW
The new William Pitt and Julia B. Fee
Sotheby’s International Realty marketing campaign revolves around the
firm’s core belief that everyone deserves
the exceptional. The company understands that the nature of real estate is
such that anyone who enters it – from
people who buy and sell to agents to the
firm’s own employees – deserves access
to the finest experience possible. With
1,000 of the area’s marquee agents and
27 offices throughout Connecticut, the
Berkshires and Westchester County,
N.Y., the firm aims to stand as the mark
of exceptional service, information,
people and hospitality, ensuring
everyone’s success throughout the real
estate transaction.
The company developed its new campaign mantra based on this perspective.
“Move Up” speaks to those who aspire
to work with, and be, the best—whether
buyers seeking to move up to a better
house or work with a better agent,
sellers seeking to list with a better
company, or agents seeking to work
with the best real estate brand. The
company provides its agents the tools to
succeed to the next level, including the
most sophisticated marketing and
international connections. On a larger
scale, the global Sotheby’s International
Realty brand too fits into the “Move Up”
proposition, with a name synonymous
with service and quality.
The invitation extended by the campaign is hard to resist: Move up with us,
and experience the exceptional.
To learn more, please contact Monique
Rafferty, William Pitt and Julia B. Fee
Sotheby’s International Realty Director
of Marketing, at 203.644.1478
or mrafferty@wpsir.com.
644-646 Harris Road, Bedford Hills, NY
Easily reachable from New York City
via a quick car commute or MetroNorth train, Northern Westchester
County is once again proving a fashionable weekend escape. According to
Angela Kessel, an agent with the
Bedford brokerage of Houlihan
Lawrence, 2017 was the strongest year
for the local second-home market since
the Great Recession.
“Second-home buyers from Manhattan
and Brooklyn are looking for an easy
getaway,” Kessel remarked. “A home
they can use on the weekends and have
the option to commute from during the
week, if necessary.”
She noted the number of weekend
buyers she worked with doubled just
over the past year. Many are
discovering cultured communities
like Bedford, Pound Ridge or North
Salem are an ideal alternative to
the Hamptons.
“My buyers want privacy, and they
want amenities like a pool or a separate
cottage or space for guests,” explained
Kessel. “They’re enamored with whole
farm-to-table movement and they love
shopping in the local farmers markets.”
Other attractions in northern
Westchester include the Katonah
Museum of Art, Caramoor Center for
Music and the Arts in Katonah, and
several magnificent county-owned
parks, including the 4,315-acre Ward
Pound Ridge Reservation in Cross
River and Lasdon Park and Arboretum
in Somers.
“I’m bullish on the market for 2018,”
Kessel added. “The financial and
technology sectors look strong, and I
think home buyers from these markets
will continue to look to northern
Westchester for both primary and
second homes.”
Connect with Angela Kessel:
akessel@houlihanlawrence.com
angelakessel.houlihanlawrence.com
.
M6D | Friday, May 4, 2018
THE WALL STREET JOURNAL.
NY
The Unrivaled Market Leader
TA RRY TOW N , NY · $12,995,000
G R EEN WICH , C T · $9,500,000
RYE , NY · $8, 200,000
G REENWICH , C T · $7,995,000
Magnificent stone Manor on 2.83 acres in the prestigious
Greystone on Hudson enclave. WEB# WS1432017
Amanda Cernitz | Mobile 914.348.1777
43-acre estate. Offered as one parcel. Town approved
8-lot subdivision. WEB# WS1427185
BK Bates | Mobile 203.536.4997
Waterfront living on one of the most scenic points with
panoramic views of L. I. Sound. WEB# WS1440664
Michael McCooey | Mobile 917.968.9737
Stunning six bedroom classic amid 2.34 acres with
Shoreline pool. WEB# WS1451868
Ellen Mosher | Mobile 203.705.9680
SC A R S DA LE , NY · $7,750,000
G R EEN WICH , C T · $7,595,000
G REENWICH , C T · $7,195,000
N E W C A N A A N · $5,995,000
Extraordinary Georgian estate situated on 1.67 private
acres in the heart of Murray Hill. WEB# WS1418570
Miriam Lipton & Deborah Glasser | Mobile 914.260.9151
Custom-built six bedroom estate set on four acres with
a pool just minutes to town. WEB# WS1451253
Ellen Mosher | Mobile 203.705.9680
Putnam Lake. Two acres. Six bedrooms. Billiards,
theater, pub, wine, golf. Pool. WEB# WS1443569
BK Bates | Mobile 203.536.4997
Spectacular panoramic views of NYC and Long Island
Sound await you. Private 7 acre estate. WEB# WS1455916
Wendy Dixon Fog | Mobile 203.979.6277
B RONX V ILLE , NY · $5,495,000
RIV ER SIDE , C T · $ 4,495,000
G R EENWICH , C T · $ 4, 250,000
RYE , NY · $ 4,195,000
Home has been completely renovated and is one of the
most stately Colonials in the Village. WEB# WS1459123
Sheila Stoltz | Mobile 914.310.6220
2018 five-bedroom modernist design with 220-foot
shorefront; private dock. Pool site. WEB# WS1452555
Ellen Mosher | Mobile 203.705.9680
Elegant six-bedroom Manor on two acres. Magnificent
indoor pool; golf putting green. WEB# WS1457286
Ellen Mosher | Mobile 203.705.9680
Classic Landmark Construction Colonial thoughtfully
designed and superbly executed. WEB# WS1425049
Patricia Geoghegan & Kendra Moran | Mobile 914.329.0901
SC A R S DA LE , NY · $3,695,000
L A RCH MONT, NY · $3,6 49,000
L A RCH MONT, NY · $2,999,900
B RONX V ILLE , NY · $2,995,000
Stunning new construction set gracefully on just under
an acre of private wooded views. WEB# WS1460559
Gregg Goldsholl | Mobile 646.342.2286
Impeccably renovated Larchmont Manor classic Colonial
located near the water’s edge. WEB# WS1445893
Linda Filby & Kimberly Arenas | Mobile 914.772.5389
English-style cottage in the heart of the Manor with
0.87 acres and a river front setting. WEB# WS1445029
Pollena Forsman | Mobile 914.420.8665
Extremely well-maintained six-bedroom Hilltop home
with rich exquisite architectural details. WEB# WS1462829
Jane Vergari & Happy French-Zingaro | Mobile 914.954.8985
B EDFORD HILL S, NY · $2,850,000
SC A R S DA LE , NY · $2,795,000
RYE , NY · $2,595,000
A R MON K , NY · $2,500,000
This organic farm delights the senses in every way.
Separate one bedroom guest cottage. WEB# WS1450567
Suzanne Pandjiris & Cecilia Heller | Mobile 914.772.5029
Welcome to this custom-designed home by a renowned
Greenwich architectural firm. WEB# WS1451818
Jennifer Fischman & Sheila Stone | Mobile 914.433.3503
English cottage completely refreshed with breathtaking
water views from every room. WEB# WS1442768
Pollena Forsman | Mobile 914.420.8665
Stunning Mid-Century Modern by award-winning
architect. 5,039 square feet on 2.24 acres. WEB# WS1460187
Kymie A. Cooksey | Mobile 914.844.4005
SC A R S DA LE , NY · $2,499,000
L A RCH MONT, NY · $2,495,000
W HITE PL A IN S, NY · $2,395,000
N E W ROCH ELLE , NY · $1,899,000
6,160 square foot open floor plan Colonial includes seven
bedrooms, six-and-a-half baths. WEB# WS1426512
Maurine Murray | Mobile 914.261.7034
Chic and sophisticated! Beautifully renovated with a
keen sense of style and function. WEB# WS1453866
Linda Filby | Mobile 914.772.5389
Enchanting, historic, gracious and transcendent
describes this amazing Farmhouse. WEB# WS1422664
Deborah Glasser & Miriam Lipton | Mobile 914.391.4995
Private retreat blending classic coastal scenery with
modern open-concept. WEB# WS1459514
Wendy McManus | Mobile 914.316.4585
A R MON K , NY · $1,799,000
M A M A RON ECK , NY · $1,794,500
PELH A M H EIG HTS, NY · $1,7 75,000
SC A R S DA LE , NY · $1,495,000
Modern classic in an organic environment perched on
one of the highest points in Armonk. WEB# WS1449021
Amy Singer | Mobile 914.772.3526
Exceptional Townhouses across from the Mamaroneck
Harbor with water views. WEB# WS1446602
Edith (Edie) H. Roth | Mobile 914.980.2879
Famous architect and first owner. Updated throughout.
Three blocks from train station. WEB# WS1450136
Arthur L. Scinta | Mobile 914.552.1420
Don’t miss this immaculate Dutch Colonial located on
a picturesque street. WEB# WS1458854
Kristy O’Hare & Hollis Borteck | Mobile 718.207.5626
N E W ROCH ELLE , NY · $1,389,000
N E W ROCH ELLE , NY · $1, 279,000
B RI A RCLIFF M A NOR , NY · $1,199,999
HASTINGS-ON-HUDSON, NY · $949,000
Stately classic Colonial in Larchmont Woods with modern
open concept. Renovated in 2014. WEB# WS1459285
Jennifer Marsh | Mobile 917.658.5917
Georgian Colonial offering an open floor plan, high
ceilings and generous room sizes WEB# WS1460802
Brendan Marshall Conroy | Mobile 914.743.7232
Spacious Contemporary with open floor plan and many
luxurious updates. .97 landscaped acre. WEB# WS1458790
Suzan Zeolla | Mobile 914.557.1885
Impressive and spacious four-bedroom, four bath
Contemporary home. WEB# WS1460209
Adilia Tamir | Mobile 914.260.1406
HOULIHANL AWRENCE
@HOULIHANRE
@HOU LIHANL AWRENCE
HOULIHANL AWRENCE.COM
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M6E
NY
Special Advertising Feature
WESTCHESTER AND FAIRFIELD COUNTIES
Residents Love the Lifestyle Variety
YOU CAN OPT TO BE A HERMIT OR A SOCIAL BUTTERFLY—OR BOTH
By Joseph Dobrian
W
estchester
County, N.Y.,
and Fairfield
County,
Conn., are
national bywords for the peaceful, prosperous suburban
lifestyle. You can choose an estate
with acreage; a house of almost
any size in any of a wide variety
of communities; or an apartment
in a friendly town with a relaxed
environment.
EASILY ACCESSIBLE
Cultural activities, fine dining,
“retail therapy” and physical
recreation are all plentiful here.
Manhattan is minutes away by
train; the Hamptons, the Catskills
and the New England states are
all easily accessible.
Dr. Teresa Piliouras, CEO and
founder of an IT consulting
company, lives and works in the
town of Weston, one of the
smaller, more remote options in
Fairfield County. There, she says,
she can “be a hermit” whenever
she chooses.
“Weston is notable for its
minimum two-acre zoning, a big
beautiful school campus, lots of
woods and wildlife, and open
spaces,” she says. “It’s a town of
about 10,000, and strictly residential. We have some very powerful
business people, and a surprising
number of entrepreneurs, hidden
away here.
“We have one tiny speck in the
middle of town where there’s a
grocery store, dry cleaner, fast
food store, real estate office,
hardware store, gas station, and
pharmacy—and it’s amazing how
these tiny little stores will have
anything you need. You can take
wonderful day trips from here.
“The town of Westport is right
next to us, and has a lot more
going on. I love to hop on a train
and go to Manhattan to see a
show or visit a museum, and I
always meet so many interesting
people on the train to the city:
I’m never disappointed!”
“CULTURAL ACTIVITIES,
FINE DINING, ‘RETAIL
THERAPY,’ AND PHYSICAL
RECREATION ARE ALL
PLENTIFUL HERE.”
Singer and actress Laura Jean
Fumia, who lives in Eastchester,
says she likes the easy commute
into the city, as well as an urban
lifestyle that’s less hectic than the
Bronx, where she grew up.
LESS EXPENSIVE
“Groceries, gasoline, and so
on are less expensive here,” she
says, “and the commute into
Manhattan can be easier than
from the outer boroughs. I’m in
Manhattan in half an hour, on
the Metro North. I’m a city girl, so
I like having people around me,
but there are fewer of them here,
and I know my neighbors.
“I work in the city, but there’s
quite a lot of theatre in Westchester, and lots of restaurants.
For many, Westchester and Fairfield bring to mind a friendly, relaxed yet vibrant way of life in the suburbs.
Some of the communities here
are expensive, but it’s a big place:
you can still find good deals.”
Jeremy Ezra, executive vice
president at RKF, a retail leasing firm, remarks that White
Plains has an iconic shopping
destination with a great mix
of contemporary fashion and
luxury brands, but other
options abound.
“If you want a more charming
experience, with a good mix of
national, local and international
brands, you have Greenwich,
and downtown Westport. We’re
also seeing boutique fitness
clubs: more highly specialized
operations. Greenwich has some
wonderful dining options; so
does Stamford. White Plains
has some good corporate-type
dining options and a late-night
bar scene.”
IT’S TIME FOR ELLIMAN
As the #1 brokerage in New York City and the 3rd largest
residential real estate company in the nation, the Douglas
Elliman network connects our clientele to over 7,000 agents
and 110 offices throughout the country.
Elliman’s reach extends far beyond national borders as well
thanks to our strategic alliance with Knight Frank Residential
which connects us to affluent consumers around the world.
Locally, our offices in Scarsdale, Chappaqua, Bedford,
Katonah, Armonk and Greenwich allow us to provide best-inclass service throughout the region and beyond.
Whether you are ready to sell or looking to buy, our agents
have the insight, connections and technology to help you
every step of the way. Let us put the power of Elliman to
work for you.
Visit Elliman.com today.
LO O K I N G TO E X P E R I E N C E T H E B E S T O F W E S TC H E S T E R A N D FA I R F I E L D C O U N T I E S ?
I T ’ S
T I M E
F O R
E L L I M A N
Bedford, NY | Price Upon Request | Web# 4813742
Circa 1930 Manor house on approx. 40 acres with
10-stall stable, pool, tennis court and guest house.
Sally Slater O: 914.234.4590 M: 914.584.0137
Greenwich, CT | $10,000,000 | Web# CT101971
Majestic Manor with 7-BR, 9-BA is set on approx.
4 lush acres. In a coveted close to town location.
MaryAnn Heaven O: 203.622.4900 M: 203.561.6915
Greenwich, CT | $9,985,000 | Web# CT102703
Extraordinary French Norman estate set on approx.
5.83 acres in prime Mid-Country in Khakum Wood.
Robin Kencel O: 203.622.4900 M: 203.249.2943
Greenwich, CT | $8,250,000 | Web# CT102651
Spectacular new construction stone and clapboard
home to-be built on approx. 5.38 acres.
Beverley Toepke O: 203.622.4900 M: 203.253.1715
Greenwich, CT | $8,250,000 | Web# CT102283
Spectacular lakeside Manor set on approx. 2.3
acres. Close to town with chic interiors and pool.
Robin Kencel O: 203.622.4900 M: 203.249.2943
Scarsdale, NY| $3,875,000 | Web# 4805855
New construction 6-BR, 6.5-BA Colonial. Luxuriously
appointed. Close to village, train and schools.
Edi Giguere O: 914.723.6800 M: 917.667.7607
Greenwich, CT | $3,250,000 | Web# CT102330
In the serene Milbrook Association, this 4-BR, 4.5-BA
home has been exquisitely renovated and expanded.
Jennifer Leahy O: 203.622.4900 M: 917.699.2783
Greenwich, CT | $2,695,000 | Web# CT102755
Extraordinary 5-BR, 4.5-BA Colonial in prime in-town
location boasts chic and classic interiors.
Sharon Kinney O: 203.622.4900 M: 203.536.2014
Chappaqua, NY | $1,900,000 | Web# 4738684
This approx. 6000sf Colonial features a stunning
pool with spa and sport court on approx. 3 acres.
Paul Tollefson O: 914.238.3988 M: 914.705.3048
Chappaqua, NY | $1,740,000 | Web# 4814802
Elegant 4-BR Colonial in Hardscrabble Lake
Community. Spacious rooms and renovated kitchen.
Pam Akin O: 914.238.3988 M: 917.539.0820
Larchmont, NY | $1,399,000 | Web# 4817994
Renovated Howell Park Colonial with 2 master
suites and lower level bonus room with fireplace.
Suzanne Moncure O: 914.723.6800 M: 914.263.9153
Mahopac, NY | $1,100,000 | Web# 4814892
On Lake Mahopac, this sun-filled home offers a
pool, private beach, outdoor fireplace and cabana.
Margaret Harrington O: 914.232.3700 M: 914.572.7395
NEW YORK CITY | LONG ISLAND | THE HAMPTONS | WESTCHESTER | CONNECTICUT | NEW JERSEY | FLORIDA | CALIFORNIA | COLORADO | MASSACHUSETTS | INTERNATIONAL
88 Field Point Road, Greenwich, CT 06830 | 203.622.4900 © 2018 DOUGLAS ELLIMAN REAL ESTATE. ALL MATERIAL PRESENTED HEREIN IS INTENDED FOR INFORMATION PURPOSES ONLY. WHILE, THIS INFORMATION IS BELIEVED TO BE CORRECT, IT IS REPRESENTED SUBJECT TO ERRORS, OMISSIONS, CHANGES OR WITHDRAWAL WITHOUT NOTICE. ALL PROPERTY
INFORMATION, INCLUDING, BUT NOT LIMITED TO SQUARE FOOTAGE, ROOM COUNT, NUMBER OF BEDROOMS AND THE SCHOOL DISTRICT IN PROPERTY LISTINGS SHOULD BE VERIFIED BY YOUR OWN ATTORNEY, ARCHITECT OR ZONING EXPERT. EQUAL HOUSING OPPORTUNITY.
.
M6F | Friday, May 4, 2018
THE WALL STREET JOURNAL.
NY
Special Advertising Feature
WESTCHESTER AND FAIRFIELD COUNTIES
Year-Round Recreation Appeals to Homebuyers
M
any people looking for a
home in Westchester
County, N.Y., or Fairfield
County, Conn.—whether
they’re coming from New
York or other parts of the world—wonder
whether the area will have enough amenities and recreational activities to keep
them occupied. Also, does the area have
a personality of its own? Does it offer a
lifestyle that can’t be found elsewhere?
Residents and real estate professionals
agree that these two counties have yearround appeal, with plenty to do in all
four seasons. New York is right nearby if
you want it—but the local lifestyles are
what give these suburban communities
their allure.
LIFESTYLE TOOLS
“Not only do we market our properties;
we market the particular towns’ lifestyles,”
explains James Gricar, general sales
manager at Houlihan Lawrence.
“People coming in from other parts of
the world want to know what there is to do
here—not just where to find the best dry
cleaner, but the best place to pick apples in
the fall—so we have a lifestyle Web site,
northof.nyc, and Journeys, the printed
version. These tools help our customers
learn about our markets before they visit.
The Web site is divided by lifestyle: the
Villager, the Equestrian, the Trailblazer,
the Waterfronter, the Locavore, the
Cosmopolitan.”
“THESE TWO COUNTIES
HAVE YEAR-ROUND APPEAL,
WITH PLENTY TO DO IN
ALL FOUR SEASONS.”
Westchester County offers more of an
urban experience, including cities like
White Plains and Yonkers, but the
northern parts of the county are somewhat more countrified. Fairfield County
has larger towns like Greenwich and
Westport, but plenty of little villages and
countryside as well. Favorite activities in
both areas—and in the counties to the
north—include various fall festivals and
food events, pond-skating in the winter,
and plenty of golf.
“And horses, horses, horses,” Mr.
Gricar adds. “You’ll find equestrian
properties especially in northern
Westchester, and many of our customers
want a property where they can keep at
about one-third of the population.
Weston is a little more affordable; you
might prefer Weston if you want more
privacy and land. Weston also has awardwinning schools.
“The town of Fairfield includes
Southport, which is known for its historic
village on Southport Harbor.”
New construction is always in demand,
Ms. Wright adds, but that comes at a
premium. House prices usually drop
the farther the property is from a downtown area.
“Colonials are still the most popular
architectural style,” she says, “but some
buyers want a ‘transitional’ interior, with
more modern finishes. Fewer people are
looking for a formal living room; they
want a family room or open space that
connects to the kitchen.
“Home offices are important too,
and everyone wants an island in the
kitchen that becomes a hub for the
family. Kitchen finishes have moved on
from granite. Today’s customer wants
quartz materials.”
COURTESY OF HOULIHAN LAWRENCE
By Joseph Dobrian
COURTESY OF HOULIHAN LAWRENCE
THE PROPERTY MARKET REMAINS STRONG BECAUSE OF THE RANGE OF ACTIVITIES AVAILABLE
STEADY PRICES
Sailing and horseriding are two of the most popular activities for residents in these counties.
least one horse. Most people don’t
associate our market with the beach, but
most towns have great beach amenities.
The biggest activities in the eastern
part of our market are water-based—and
we have many more bodies of water here
thanmostpeoplethink.Hikingaroundthe
watersheds is a big deal. This is a small
region, but—topographically and culturally—the towns are so different from
one another.”
LIVELY ARTS SCENE
Mr. Gricar adds that the area has a
lively arts scene, with the focus on
contemporary art. Overall, he says, the
livestyle is “a combination of East Coast
cosmopolitan and New England earthy.
“Our customers want to know, ‘Are the
basics here?’ and of course, they are, but
they want to also know, ‘Am I moving
somewhere special?’ They want to
know that there’s character up here,
a point of view, a lifestyle that’s different
from what they’re used to but familiar
as well. Northof.nyc lets them see this
area in contexts other than the house
they’re buying or the schools they’ll
send their kids to.”
Joan Wright, realtor at William Pitt
Sotheby’s, says Westport, Conn., is an
artisticcommunity,withmanywaterfront
amenities, “more sophisticated and
diverse than many other towns.
“Westport sells itself,” she says.
“It’s a 70-minute commute by train
to Manhattan. We have great beaches,
boating, an 18-hole golf course for
Westport residents, and plenty of private
[golf] courses in nearby towns.
“Weston is directly north of Westport:
about as big geographically but with
Kathleen Collins, broker at William
Pitt Sotheby’s Realty, notes that prices
seem to be holding pretty steady in
Westchester, although she has seen
a pause in the market and some price
declines because of the recent questions
about tax reform, and the prolonged
winter. But, she says, she’s confident
that business will stay strong, largely
because of the amenities available
in Westchester.
“The county has 18,000 acres of
park land,” she notes, “with golf courses,
pools, and other amenities. We have
lots of small villages with great restaurants; you’re convenient to the beaches
on Long Island Sound and walking
trails. Within 45 minutes you could be
on an ocean beach on Long Island, or
skiing upstate.
“Each of our villages has its own
special characteristics. I’m located in
Bronxville, a small, very urban/suburban community of one square mile
where you can walk everywhere, so
you’re not spending as much time in
the car as you might [living] in other
parts of Westchester.
“Like Bronxville, Rye has a vibrant
downtown; Irvington has a great waterfront park. Larchmont is another of my
favorites. I especially love our river towns.
Westchester has some of the best public
schools in the nation, which is a great
attraction to younger families.”
Joseph Dobrian is a freelance writer
specializing in real estate matters.
A ettting hha nnsppireress
Offering breathtaking Hudson
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4 VA L L E Y R O A D | B R O N X V I L L E , N Y 1 0 7 0 8
H O U L I H A N L A W R E N C E .C O M
.
THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M7
NY
MANSION
LIVING HISTORY
A Renovated Riad That’s Fit for a Sultan
A French couple combined three historic riads to create a palatial space; now listed for $3.64 million
BY RUTH BLOOMFIELD
M’HAMMED KILITO FOR THE WALL STREET JOURNAL (6)
EXOTIC DECOR
Clockwise from top
left: traditional
arched doorways
and a colorful sitting room; homeowner Jean Dominique Leymarie;
one of the 12 bedrooms; the dining
room; and an outdoor living room.
IT TOOK THREE YEARS and dozens of artisans—plus a fleet of
donkeys—to create Villa Athena, an
11,496-square-foot home in Marrakesh, Morocco, fit for a sultan.
Jean Dominique Leymarie and
his wife, Marielle, both 71 years
old, first decided to buy a vacation
home in Morocco as an escape
from the cold winters of their
home in northern France.
In 1993 they spent about
$300,000 on a fully renovated riad
in Marrakesh’s old city. A decade
later the rundown riad next door
came on the market, and Mr. Leymarie, a civil engineer by trade,
agreed to buy it, too, for $364,000.
Soon thereafter, another adjacent
riad came up for sale, also in need
of restoration, and so he bought
that one also.
His total investment came to
around $725,000 and, after a
lengthy renovation, the resulting
property now has 12 bedrooms and
10 bathrooms, plus three courtyards
and a sequence of roof terraces.
In 2006, Mr. Leymarie sold the
golf club he had built and run in
France and began work on a new
venture, opening a boutique hotel
in Marrakesh. He now has four. In
2008 the couple and their dog, Bis,
moved full time to Morocco, where
Mr. Leymarie could manage the
renovation.
“The riads were in horrible condition, like a ruin. There were no
bathrooms, nothing,” he said.
Despite the age of the riads—
which Mr. Leymarie believes date
from the 17th or 18th century—
some of their original architectural
features were intact, giving clues
to how to go about the project,
which Mr. Leymarie estimates
ended up costing between
$970,000 and $1.2 million.
Some of the columns in the central courtyard still stood, and
those that had collapsed were replicated. Similarly he had missing
sections of hand-carved cornicing
restored. Rather than attempt to
pass them off as authentic parts of
the original fabric of the building
he chose to leave them unpainted,
as a record of the restoration.
The practicalities of building in
an ancient city were challenging.
Building materials had to be conveyed by donkey and cart in
streets too narrow for trucks. “We
had to make thousands and thousands of journeys with the donkeys,” he said.
In furnishing the home, Mr. Leymarie remained faithful to tradition. Lustrous tadelakt (a form of
polished plaster) has been used on
walls and bathrooms, clay floor
tile was laid indoors and out in a
herringbone pattern as a counterpoint to vivid sections of mosaic.
Some rooms have painted cedar
ceiling beams, others have carved
cedar doors. Rooms are lighted by
lanterns, and their flickering light
adds to the sense of drama. One of
the bedrooms features a domed
ceiling with brickwork laid out in a
pattern of stars. Minimalists would
hate it.
This labor of love is now for
sale, listed for $3.64 million with
Kensington Luxury Properties.
Mrs. Leymarie is looking to
downsize to a more peaceful location, although Mr. Leymarie is
less enthused.
“I live in a palace,” he said. “To
me that is much more fun than to
live in an apartment. It is like
magic. But for two people it is too
big, so we will see. If someone
comes along who likes this type of
life we will sell it.”
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THE WALL STREET JOURNAL.
M8 | Friday, May 4, 2018
MANSION
THE EXOTIC—AND CHAOTIC—MEDINA
FROM TOP: JAMES RAJOTTE FOR THE WALL STREET JOURNAL (3); EMILE GARCIN PROPERTIES
CITYSCAPE Above, from left to right: street scenes in the Dar El Bacha neighborhood in the medina of Marrakesh;
pedestrians near the Ben Youssef Mosque; and a selection of carpets on display in the marketplace.
ANCIENT ART This riad features elaborate mosaic tilework and stained-glass windows. It is listed for about $875,000.
On the Market
$270,000
BARNES INTERNATIONAL REALTY
Continued from page M1
craftsmanship as much as the
wealth and prestige of the owner.
“A riad really encapsulates a
whole culture and philosophy,”
said Grant Rawlings, owner and
founder of real-estate agency Chic
Marrakech. “They are enclosed
and hidden away, a private, sacred
space. Everything has meaning—
even the door knockers, which
come with amulets to ward off bad
luck.”
Marrakesh’s old city—or medina—has been tempting overseas
buyers ever since the 1960s, when
the likes of Yves St. Laurent and
Talitha and John Paul Getty Jr.
made it fashionable. Their interest
has helped keep this niche property market stable over the past
decade, while prime values in
other parts of Marrakesh have
fallen 30%, according to estimates
by local agents.
Riads are also affordable compared with homes in major European or North American cities. A
two-bedroom riad of around 800
square feet would cost between
$150,000 and $170,000, estimated
Mr. Rawlings. A four-bedroom,
2,000-square-foot riad around
$300,000 to $340,000. At the upper end, roughly $2.5 million would
buy a 5,000- to 6,000-square-foot
riad big enough for a large family
or a boutique hotel.
Currently listed, with Barnes International Realty, is a roughly
3,600-square-foot riad close to
Marrakesh’s famous souks, on the
market for just over $1 million.
The five-bedroom, five-bathroom
property has a courtyard tiled
with clay tiles, and a heated swimming pool. Some of the ceilings
and doors are exquisitely painted.
The majority of riads are sold to
foreigners—young Moroccans tend
to prefer more modern environs,
said Maude Fajas, director at
Emile Garcin Properties. “People
come from London, Paris, Geneva
and they have a really normal,
clean, organized life,” she explained. “They come to the medina
and they fall in love with the small
streets and the food, and the very
Three bedroom in 2,045 square feet
This 2,045-square-foot riad has been renovated in a neutral, contemporary style but using traditional Moroccan
materials, such as polished tadelakt plaster. The bedrooms
and two living rooms overlook a central patio garden, and
there is also a roof terrace. Price includes furnishings.
Agent: Barnes International Realty
special atmosphere.”
But even in a small area like the
medina, location matters. The
neighborhoods of Dar El Bacha,
Bab Doukkala and Riad Laârouss
are all particularly popular, said
Alex Peto, a director of Kensington
Luxury Properties and Christie’s
International Real Estate’s affiliate
in Morocco. Much of the medina is
pedestrian-only, but these neighborhoods have good access by car
and are within a 10-minute walk of
Jamaa el-Fna, the medina’s main
square. “This is particularly important if you are going to be renting
your riad out to holidaymakers,”
said Mr. Peto. His clients tend to
be from France, the U.K., and the
Middle East, although he has made
recent sales to buyers from India,
Scandinavia and New Zealand, too.
Despite its cosmopolitan community (and an increasingly affluent local population) the medina
has managed to retain its character.
Its rabbits’ warren of streets
thrums with life. There are countless souvenir shops, but over the
past three or four years, Ms. Fajas
notes the arrival of more boutiques showing off cutting edge local design. There are some excellent restaurants as well as an
increasing number of coffee shops.
To date there are no chain stores
or supermarkets.
On the downside life in the Medina means dealing with a level of
harassment from beggars and street
traders, while simultaneously dodging bicycles and motorbikes. Riads
are usually attached on both sides,
and located down narrow alleys
within a noisy, dirty, teeming two
square miles of friendly anarchy.
Mr. Peto notes that although buyers often fall in love with the medina at first sight, the love affair
doesn’t always last. “A lot of people
have started off living in the medina
and after a couple of years have
moved out of town,” he said. “I
guess it gets a little bit too much.”
Inside a richly renovated riad
listed for $3.64 million M7
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THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M9
ADVERTISEMENT
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THE WALL STREET JOURNAL.
M10 | Friday, May 4, 2018
MANSION
SPREAD SHEET | ADAM BONISLAWSKI
KEVIN WHIPPLE
THE PRICIEST HOMES
SELL FAST—OR DROP
Homes in Bel-Air, Brentwood lose value; Palo Alto properties hold up
WHAT difference does
a day make?
About
$44,000 if
you live in
Bel-Air.
That’s
how much the priciest
homes in the upscale Los
Angeles neighborhood depreciated each day they sat on
the market in 2017, according to real-estate firm Concierge Auctions.
The company collected
data from Multiple Listing
Service and other public
sources on the 10 most expensive homes sold in 2017
in 40 U.S. markets. It looked
at how many days these
properties spent on the market and what percentage of
their original asking prices
they ultimately achieved.
The upshot? Sell fast or
you’ll have to sell low.
“The data shows that a
property either sells very
quickly out of the gate for a
high percentage of its asking
price, or it lingers on the
market and sells at a much
later date for a much lesser
percentage of the original
listing price,” says Laura
Brady, president of Concierge Auctions.
In terms of daily depreciation, Bel-Air led the way
with its eye-popping
$44,000 figure. Another tony
L.A. neighborhood, Brentwood, placed second, with
properties there losing an
average $25,000 a day. Palm
Beach, Fla., came in third,
with a $22,000-per-day drop.
Other places saw big gaps
between original listing
price and ultimate sale price.
Vero Beach, Fla., performed
the worst on that score, with
properties selling for just
62% of their initial ask.
Greenwich, Conn., was next,
with properties there selling
for 65% of their original asking price. The priciest properties in Atlanta managed
only 66% of their initial
price.
Of course, the survey’s
sample size of 10 properties
per market is small. And,
Ms. Brady notes, it’s hard to
say if the owners’ original
prices were reasonable.
Tech redoubts San Francisco and Palo Alto were the
most robust markets surveyed, with the most expensive properties selling for,
respectively, 95% and 94%, of
Mounting Losses
A look at the 10 priciest home sales in local markets in 2017 and how much the asking price fell
each day the properties went unsold.
Holmby/Bel-Air, Calif.
Brentwood, Calif.
Palm Beach, Fla.
Beverly Hills, Calif.
Greenwich, Conn.
Miami
Malibu, Calif.
Orange County, Calif.
Naples, Fla.
San Francisco County
Avg. sale price of the
top 10 transactions
Avg. days
on market
% of original list price
reflected in the sale price
Price drop
per day
$24,418,500
$15,200,000
$28,362,528
$24,352,500
$16,629,200
$22,871,100
$19,120,095
$20,981,200
$14,045,000
$12,892,500
251
154
476
347
478
608
480
589
409
55
68.8%
79.8%
72.7%
75.9%
64.8%
68.2%
74.8%
73.2%
73.7%
95.3%
$44,088
$24,958
$22,358
$22,239
$18,912
$17,580
$13,406
$13,051
$12,273
$11,591
Source: Concierge Auctions
their original asking prices.
A relatively brisk sales pace
was key. Surveyed homes
sold in an average of 55 days
in San Francisco and 180
days in Palo Alto.
By contrast, the most expensive properties in Nash-
ville, Tenn., took an average
of 1,062 days to sell, and
when they did it was for 73%
of their original asking price.
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DISTRICT OF COLUMBIA
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CALIFORNIA
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THE WALL STREET JOURNAL.
Friday, May 4, 2018 | M11
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FLORIDA
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M12 | Friday, May 4, 2018
THE WALL STREET JOURNAL.
NY / NE
MANSION
TRAVELER Marcia Gay Harden in
New York City in March, left, and in
the early 1960s, on right, with her
family in Long Beach, Calif., inset.
HOUSE CALL | MARCIA GAY HARDEN
She Just Needed
A Push From Mom
(L-R) AXEL DUPEUX FOR THE WALL STREET JOURNAL; MARCIA GAY HARDEN
The actress lost a bet with her mother and won an
Oscar; today, a Mar Vista home in L.A.
My mother wasn’t a stage mom but she was
convinced I had talent. In the early 1980s,
fresh out of college with a major in theater,
my plan was to work odd jobs and audition in
Washington. But I was stubbornly insecure.
My mother, Beverly, sensed my
anxiety. One weekend, when I visited my parents’ home in Virginia,
she pulled out an article about auditions for a local production of Neil
Simon’s “I Ought to Be in Pictures.”
I insisted it was a musical and
resisted. My mother gently offered
to call to see if it was a musical. I
said, “fine,” so she called. It wasn’t
a musical. I auditioned and got my
first professional theater part.
What’s more, I received good reviews and won an award. More
plays and good reviews followed.
Somehow, my mother knew that if
she just got me to the edge, I’d fly.
When I was little, my family
lived in a three-bedroom ranch
house in Garden Grove, Calif. My
father, Thad, was a naval officer
who rose to the rank of captain.
He’d be away for six months at a
stretch. The person who maintained the ship at home was my
mother. There were five kids—I
was the middle child.
All in all, we were good kids.
This had a lot to do with my
mother’s lightheartedness and
kindness. Her voice was soft and
reminded me of Snow White. She
also loved planning fun events to
keep us occupied. May 1 was always a big deal. The night before,
we gathered flowers in the garden.
The next morning, we made little
bouquets and “Happy May Day”
cards. Then we left them hanging
on neighbors’ doors.
When I was 8, in 1967, my father was transferred to Japan,
where he helped command a ship.
Our house was on the naval base,
halfway up a hill. It was magical.
My mother became
a sexy, determined,
’60s woman who
wore asymmetrical
dresses in orange
and yellow.
Our house had a
front porch, where
we put on plays for
families on the
base. The first was
“The Princess and
the Pea.” I pretended to stagger
while carrying a
heavy cake, and the
audience laughed. I
thought, “They think I’m funny.
This is clearly something I need to
be doing.”
The house that changed me
most was in Greece. In 1976, my
dad was appointed commanding
officer at a base in a town called
Nea Makri, on the eastern coast.
We rented the house of a shipping
magnate. The furnishings were
beautiful, and the house looked
down at the bluest water.
Finally, I had my own bedroom.
It was circular with french doors
that opened to fragrant trees in
our backyard. Each day I was overcome by the smell of jasmine,
lemon and orange trees and roses.
There was an intoxicating sensuality there, and I fell in love with the
country.
I spent my first year in college
in Greece. Acting became a passion
after I watched ancient Greek
plays performed at the foot of the
Acropolis in Athens. When I
moved to Munich for my second
year of college, I began to take
acting seriously. During a rehearsal, my teacher said, “Oh,
(pause), you’re good.”
After my last year of college at
the University of Texas, I moved to
Washington, D.C., then to New
York. I waited tables at the Pierre
Hotel and went on auditions. By
then, all of my friends were buying
stereos and having babies. I didn’t
have anything except a fifth-floor
walkup in the West Village.
My parents were supportive, in
their own way. My dad dropped
hints about me studying computers as a fallback. Then NYU gave
me a full scholarship to its graduate program in theater. My mother
said, “At least she’ll
be able to teach.”
In 1988, I auditioned for Joel and
Ethan Coen. The directors were casting unknowns for
their movie,
“Miller’s Crossing.”
Months later, when
I was in my
kitchen, my agent
called. “You got the
part!” he said. I fell
to my knees. My
first major film
role. I called home.
My dad said, “Fan-blanking-tastic.”
My mother said softly, “Oh, Marcia
Gay!”
Today I live in Mar Vista, in Los
Angeles. My house is Spanish Mediterranean, but old. The four-bedroom house is about me and my
three kids.
On one side you can see the Pacific and on the other the mountains. But they aren’t sweeping
views. What we have is privacy.
My father died in 2002. My
mother today has Alzheimer’s. I
don’t measure what stage she’s in,
but she’s handling the disease with
grace. When I ask, she says the
most important things to her are
love, flowers and her family. This
is the same woman who pushed
me to audition. I don’t want Alzheimer’s to be her legacy.
—As told to Marc Myers
Marcia Gay Harden, 58, is an Oscar-winning actress who has appeared in more than 50 films, including “The First Wives Club,”
“Pollock” and “Fifty Shades of
Grey.” She is the author of “The
Seasons of My Mother” (Atria).
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MULTIMILLION-DOLLAR CLUBHOUSE and OUTDOOR RECREATION CENTER INCLUDED!
Valencia Bay is being developed and sold by Boynton Beach Associates XXII, LLLP. THE COMPLETE OFFERING TERMS ARE IN A CPS-12 APPLICATION AVAILABLE FROM THE OFFEROR. FILE NO. CP16-0105. Valencia Bay is designed for residents aged 55 & older, and are intended to meet the exemption under the
Federal Fair Housing Act. Facilities and amenities actually constructed may change at any time without notice. No representation or guarantee is made as to the timing of construction of the facilities and amenities. Each Valencia community is separate and distinct, and developed and sold by separate entities. A
purchase in one community does not grant any rights to use any of the recreational or other facilities and amenities of any other community. Prices, terms and features are subject to change without notice and do not include optional features or premiums for upgraded homesite. Valencia Bonita is being developed and sold
by Bonita Springs Associates I, LLLP. Valencia Bonita is designed for residents aged 55 & older, and is intended to meet the exemption under the Federal Fair Housing Act. This is not an offering in states where prior registration is required. Valencia Lakes is being developed and sold by Hillsborough County Associates II, LLLP.
THE COMPLETE OFFERING TERMS ARE IN AN OFFERING PLAN AVAILABLE FROM SPONSOR–FILE NO. H11-0010. Valencia Lakes is designed for residents aged 55 & older and is intended to meet the exemption under the Federal Fair Housing Act. Valencia del Sol is being developed and sold by Hillsborough County
Associates IV, LLLP. Valencia del Sol is designed for residents aged 55 & older, and is intended to meet the exemption under the Federal Fair Housing Act. Valencia Cay at Riverland is being developed and sold by Riverland Associates I, LLLP, a Florida limited liability limited partnership. Photographs may be similar but
certain specifications may differ. Nothing herein shall constitute an offer to sell, or a solicitation of offers to buy in New York, New Jersey or any other jurisdiction where such offers or solicitations cannot be made. ©2018 1100-489 4-20-18
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