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The Wall Street Journal 30 August 2017

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DJIA 21865.37 À 56.97 0.3%
WSJ.com
WEDNESDAY, AUGUST 30, 2017 ~ VOL. CCLXX NO. 51
* * * * * *
NASDAQ 6301.89 À 0.3%
STOXX 600 368.42 g 1.0%
10-YR. TREAS. À 7/32 , yield 2.134%
OIL $46.44 g $0.13
GOLD $1,313.10 À $3.40
YEN 109.75
Rainfall hits record;
city braces as second
landfall nears and
reservoirs overflow
Business & Finance
nvestors flocked to the
safety of gold and government bonds after North Korea fired a missile over Japan,
but the dollar was again left
behind. U.S. stocks recovered from early losses. A1, B13
HOUSTON—The
largest
tropical rainstorm to hit the
continental U.S. is forcing tens
of thousands of Texans from
their homes, scattering them
across the state and into overflowing evacuation centers as
the mounting crisis strains resources and weary residents.
I
Fresh challenges emerged
for Khosrowshahi even before
taking the job as Uber’s CEO,
including news of a federal
bribery probe into the firm. A1
By Russell Gold, Dan
Frosch, Ben Kesling
and Christopher M.
Matthews
United Technologies is
near a deal to buy Rockwell
for more than $20 billion, a
tie-up that would create an
aircraft-equipment giant. B1
Freeport plans to give up
its majority stake in a giant
mine, a step toward ending
a dispute with Indonesia. B3
The White House intends
to halt a rule that would have
required businesses to collect
more worker-pay data. A2
The administration plans
to tighten rules on some
borrowers who take out
reverse mortgages. A2
Cantor ceased trading
Venezuelan debt after the
Treasury Department slapped
sanctions on the country. B12
Best Buy said it would lift
spending on its e-commerce
operations and supply chain,
as it posted higher sales. B3
21st Century Fox stopped
broadcasting Fox News in
the U.K. amid its effort to
acquire the rest of Sky. B3
World-Wide
Harvey became the largest
tropical rainstorm to hit the
continental U.S., forcing thousands of Texans from their
homes as the mounting crisis
strained resources. A1, A4-A5
Trump praised federal and
local officials’ response, as he
surveyed damage in Texas. A4
The global response to
North Korea’s nuclear threat
has shifted back to a military
track after Pyongyang’s missile launch over Japan. A6
Russia’s military dismissed
Western concerns over a war
game that has underscored
Cold War-style tensions in
the Baltic Sea region. A8
Mueller has subpoenaed
the spokesman for ex-Trump
campaign chairman Manafort,
seeking his testimony before
a federal grand jury. A3
Lebanese forces said they
reclaimed all territory Islamic
State controlled in the country
for the past three years. A16
The Philippine army said
it was planning an assault to
retake Marawi from Islamic
State-linked militants. A16
A military helicopter and personnel on Tuesday rescued a stranded resident in east Houston from floods caused by Tropical Storm
Harvey. Rainfall totals reached 50 inches from the storm, and Texas officials said flooding could force 30,000 people from their homes.
Flood Insurance Fails Companies
BY RUTH SIMON
AND CAMERON MCWHIRTER
his losses.
Business owners across the
country say the National Flood
Insurance Program, the only
option for most since private
insurers largely got out of the
flood business nearly a century
ago, is sorely out of step with
their needs. Insurance experts
and some government officials
agree. The program’s limitations will be sharply tested
when Harvey’s catastrophic
floodwaters recede.
The federal program was
primarily designed for homeowners and has had few updates since the 1970s. Standard
protections for small businesses, including costs of business interruption and significant disaster preparation,
Please see INSURE page A4
The nearest Hal Pontez
could get to the North Houston
office park he owns was a
quarter mile away. From that
viewpoint on Monday, he said,
“tops of buildings are peeking
through a lake.”
One building houses another
business he owns that builds
electric power plants and services gas and steam turbines. It
was having its best year ever,
and its shop was packed to capacity with industrial control
systems and sophisticated tools
used in maintenance and repair.
Mr. Pontez has federal flood
insurance. Experience has
taught him it may not cover all
Epic Rains
Highest rainfall totals for hurricanes and tropical storms in the U.S.
Hawaii 1950
Hiki
Harvey
Texas 2017
Amelia
Texas 1978
Easy
Florida 1950
Claudette
Texas 1979
Allison
Texas 2001
Paul
Hawaii 2000
Georges
Florida 1998
Danny
Alabama 1997
Unnamed
Texas 1960
Debby
Florida 2012
0 inches
The Illinois legislature
passed a school-funding formula, closing the door on a
summer of budget turmoil. A3
Environmentalists are
abandoning an anti-whaling
campaign, citing Japan’s
threat to defend its fleet. A7
Opinion.............. A13-15
Property Report B6-7
Technology............... B4
Texas Floods..... A4-5
U.S. News............. A2-3
Weather................... A12
World News. A6-7,16
>
10
20
30
40
50
Trump views damage,
lauds teamwork................. A4
Evacuees face fear and
overcrowding........................ A5
Storm’s destruction tests
U.S. shale................................. B1
Property Report: In Houston,
the fallout begins................. B7
Heard on the Street: Will auto
insurers get soaked?........... B14
Investors Seek Gold, Treasurys but Snub Dollar
BY SAM GOLDFARB
AND IRA IOSEBASHVILI
Separate Ways
Year-to-date performance
Investors flocked to the
safety of gold and government
bonds after North Korea fired
a missile over Japan. But the
U.S. dollar, once a go-to haven,
was again left behind.
As the U.S., South Korea
and Japan issued sharp responses to North Korea on
Tuesday, the price of the 10year Treasury note rose, sending the yield down to 2.134%,
its lowest level of 2017. Gold
Gold s 14%
15%
10
5
0
WSJ Dollar Index
t7.9%
–5
–10
Jan.
Source: WSJ Market Data Group
THE WALL STREET JOURNAL.
extended a yearlong rally, hitting $1,313.10 a troy ounce, up
14% for the year.
Yet the dollar tumbled
Tuesday to its lowest level in
more than two years against a
broad basket of currencies, before staging a modest afternoon recovery in New York
trading. Even with that
bounceback, the dollar is down
12% against the euro this year
and 6.2% against the Japanese
yen. The euro on Tuesday in
intraday trading exceeded
$1.20 for the first time since
i
BY CHARLES ROLLET
eral-funds rate twice. The Dow
Jones Industrial Average rose
57 points on Tuesday to close
at 21865 after trading down as
much as 135 points, its biggest
intraday recovery in nine
months.
Gold and stocks have risen
together this year, as investors
Please see DOLLAR page A6
Investors add to gold bets... B13
Treasury yield is at low for
year................................................ B13
Uneasy investors power
utilities stocks......................... B14
INSIDE
What Tops the Agenda for a New
Space Colony? A Debate Over Taxes
i
2015.
Investors say the dollar is
reflecting a broader concern
among investors over the pace
of U.S. growth and fractious
domestic politics.
The currency’s decline has
caught many on Wall Street
off guard, because the dollar
was widely expected to appreciate in 2017 as the Federal
Reserve raised long-term interest rates. Instead, the dollar
has declined and U.S. stocks
have soared to highs even as
the Fed has boosted the fed-
i
eyed dreamers, sci-fi fans and
political idealists—and 110,000
It’s tough enough to create a of them are now officially citination in space. There’s the zens.
While Dr. Ashurbeyli’s lofty
Earth-orbiting colony to plan,
the provisioning to figure out plan involves launching “Space
Arks” into lower
and the technical
Earth orbit by 2025,
challenge of launchhe has found himself
ing thousands of
caught up in earthly
people.
debates among his
On top of that,
people about pesky
you have to make
details such as the
folks get along bespace nation’s constifore they even rocket
tution and potential
up there.
taxes.
The scale of the
Not to mention its
human task is dawnprospective shortage
ing on Russian busiIgor Ashurbeyli
of women.
nessman and scienAmong problems facing Astist Igor Ashurbeyli, who last
year drew headlines with his gardia, “the biggest is self-orplan for a peaceful democratic ganization,” said Dr. Ashurbeyli,
utopia dubbed Asgardia above 53, “because no one has ever
tried organizing…what is today
the stratosphere.
More than 300,000 people 100,000 citizens from 200 counfrom 217 countries and territo- tries who don’t know each other
ries signed up online to be As- and live in different places on
Please see SPACE page A8
gardians—among them starry-
ASSOCIATED PRESS
State officials are worried
that politics could threaten
funding for a children’s
health-insurance program. A3
Harvey’s Swath
Note: Through 5 p.m. ET Tuesday
Sources: NOAA National Centers for Environmental Prediction;
THE WALL STREET JOURNAL.
National Hurricane Center (Harvey)
A Russian wants to launch utopian outpost,
but his citizens disagree on how to run it
Trump is set to give a
speech Wednesday aimed
at emphasizing the need
for major tax changes. A2
Tropical Storm Harvey tore
through Texas for a fifth
straight day, dumping more
than 50 inches of rain on parts
of the state in a new record for
the contiguous U.S.
Texas officials said 30,000
people could be forced from
their homes due to flooding
and more than 725,000 people
were under a mandatory evacuation order. A convention center equipped to hold 5,000 people was housing over 9,000
evacuees by midday Tuesday.
Houston Mayor Sylvester
Turner late Tuesday ordered a
curfew from midnight to 5 a.m.
local time to help deter crime
and keep the streets clear for
first responders.
“I asked my daughter, is this
the end of the world?” said 74year-old Norma Brown, cradling two of her dogs in a
Houston evacuation center after fleeing the flood on a
neighbor’s boat. While waiting
in the rain to get into the
George R. Brown Convention
Center downtown, Ms. Brown
burst into tears, realizing she
had likely lost her home in
Please see HARVEY page A5
ASSOCIATED PRESS
Harvey has shut a significant portion of Texas’ shale
production, the first major
storm to test U.S. shale. B1
ADREES LATIF/REUTERS
Apple’s talks with studios
about offering ultrahigh-definition films have been hampered by discord over price. B1
s Copyright 2017 Dow Jones &
Company. All Rights Reserved
EURO $1.1974
Harvey Forces Thousands to Flee
What’s
News
CONTENTS
Business News...... B3
Crossword............... A11
Heard on Street... B14
Life & Arts......... A9-11
Management.......... B5
Markets............. B13-14
HHHH $4.00
APPLE SPARS
WITH MOVIE
STUDIOS
PLAYING HOOKY
FOR A FAMILY
VACATION
SANCTIONS’
MISUSE WILL SAP
THEIR POWER
BUSINESS & FINANCE, B1
LIFE & ARTS, A9
OPINION, A15
New Hurdles Face Next Uber Chief
Even before he takes the job
as Uber Technologies Inc.’s new
chief executive, fresh challenges
confront Expedia Inc. CEO Dara
Khosrowshahi, with news of a
federal bribery probe into Uber
and public disagreement over
how the board’s decision to hire
him unfolded.
News of the probe, reported
by The Wall Street Journal on
Tuesday, came after Mr. Khosrowshahi made his first public
comments since being voted in
as CEO by Uber directors on
By Greg Bensinger,
Douglas MacMillan
and Aruna Viswanatha
Sunday. He would succeed Travis Kalanick, the Uber cofounder who was pressured to
resign in June following a series
of scandals and amid infighting
on the board. Mr. Khosrowshahi
was selected over two more seasoned executives in Jeff Immelt,
chairman of General Electric Co.
and Meg Whitman, chief of
Hewlett Packard Enterprise Co.
Speaking with the Journal at
Expedia’s headquarters Tuesday
morning, Mr. Khosrowshahi said
his contract with Uber still
needs to be finalized, but indicated he would take the job. He
said Mr. Kalanick would remain
involved with Uber and described as “budding” his relationship with the ex-CEO. “I
think there’s mutual respect
there,” he said.
“He’s the founder of the comPlease see UBER page A8
A2 | Wednesday, August 30, 2017
* ***
THE WALL STREET JOURNAL.
U.S. NEWS
GOP Mulls Next Move on Taxes
BY RICHARD RUBIN
Changing Fortunes
Top U.S. corporate income-tax rate
50%
40
30
ANDREW HARRER/BLOOMBERG NEWS
WASHINGTON—President
Donald Trump dives back into
the tax debate on Wednesday
with a Missouri speech aimed
at emphasizing the need for
major changes as Republicans
try to figure out what they
want to do and how to proceed.
When Congress returns from
its August recess next week,
lawmakers will have a long list
of nontax items to resolve that
will occupy their time and attention for weeks, from the federal debt limit to hurricane relief efforts. In the background,
they will set the parameters for
the tax debate with the goal of
racking up a major legislative
victory before year’s end.
The summer collapse of
health-care legislation puts
even more pressure on Republican tax-package writers to
give lawmakers something to
campaign on in 2018.
Although Republicans generally agree on lower tax rates,
they aren’t sure yet how low
they can go, what breaks
would go away, and whether
their plan would reduce government revenue or be “revenue neutral.” Mr. Trump himself sometimes talks about “tax
reform”—which
typically
means a combination of cuts in
rates, the elimination of breaks
and creation of new revenue
raisers—and other times mentions “tax cuts,” meaning just a
reduction in rates.
The “reform” that Republicans have talked about for years
is much tougher politically than
20
10
0
1910
1950
2000
Source: Tax Policy Center
THE WALL STREET JOURNAL.
White House economic policy chief Gary Cohn, left, and Treasury
Secretary Steven Mnuchin.
tax cuts because it would require crossing some business
interests and eliminating deductions that some Republicans
would prefer to keep. Tax cuts,
meanwhile, would be constrained by Senate rules that
limit the ability of Republicans
to increase budget deficits and
by lawmakers’ appetite for fiscal conservatism.
The resulting bill may end
up looking more like a tax cut,
said David McIntosh, president
of the Club for Growth, a
group that backs lower taxes.
“There’s a real consensus
among Republicans that they
need to get a tax-cut bill
through,” Mr. McIntosh said.
“A positive for the tax cuts is
the donor base is very
strongly in favor of it. That
will help leadership get the
votes it needs in the House
and the Senate.”
Treasury Secretary Steven
Mnuchin and White House
economic policy chief Gary
Cohn have met for months
with congressional leaders and
released a framework in July
that ditched the House GOP’s
border-adjustment plan for
taxing imports and exports,
which would have raised revenues to help pay for deep cuts
in corporate tax rates. Going
forward, the administration is
ceding many of the details to
Congress and having the president make the public case for
whatever plan emerges.
For now, Republican law-
makers are pursuing a revamp
of the corporate and individual tax systems. It may take
months before they determine
whether the arithmetic and
politics of a revenue-neutral
tax bill—raising some taxes
and lowering others—can
work before deciding whether
to switch to a tax-cut bill.
Most Democrats reject the
GOP framework for tax policy,
saying it tilts too heavily toward high-income households
and corporations.
Republicans will be constrained by Senate rules that
limit their ability to pass a tax
bill without Democratic votes.
To do so they would first have
to agree on a budget. And
then, to pass a bill with a
straight majority, the resulting
tax bill can’t increase long-run
budget deficits.
They have a few ways to
get around that.
First, they could assume
that they don’t have to offset
the cost of extending tax
breaks that have lapsed or
are scheduled to expire. Under the typical approach Congress uses to analyze budgets, the revenue that would
be generated when those
breaks lapse is part of baseline projections. By starting
instead with the assumption
that those breaks continue indefinitely, Republicans would
lock in $450 billion in tax
cuts over a decade because
they either wouldn’t count
the cost of extending the
breaks or they could replace
them with other tax cuts.
Democrats and budget
hawks call this a loophole at
odds with Congress’s decision
in 2015 to set tax-break expiration dates.
Second, Republicans could
assume tax cuts can partially
pay for themselves by creating
faster economic growth. This
so-called dynamic scoring will
be limited by the nonpartisan
Joint Committee on Taxation’s
estimates for the effects of tax
cuts on growth.
Third, they could take a page
from the GOP’s 2001 and 2003
tax-cut playbook and make
some or all of the tax cuts temporary. That would create tax
cuts within the 10-year budget
window without adding to deficits beyond that point.
HUD to Tighten Rules on Reverse Mortgages
The Trump administration is
planning to raise premiums and
place tighter loan limits on
some borrowers in a mortgage
program that helps seniors
supplement their incomes.
The U.S. Department of
Housing and Urban Development on Tuesday announced
the changes in a letter to lenders to the so-called reversemortgage program, which allows seniors to take out a loan
against the value of their home.
The Trump administration feels
the changes are necessary to
put the program, which is backstopped by taxpayers, on a
sounder financial footing.
“Given the losses we’re seeing in the [reverse mortgage]
program, we have a responsibility to make changes that balance
our mission with our responsibility to protect taxpayers,” HUD
Secretary Ben Carson said
through a spokesman.
The modifications won’t apply to borrowers with existing
mortgages, but will affect those
who take out new loans. Some
650,000 borrowers have outstanding reverse loans insured
Rising Costs
The Department of Housing and Urban Development has backed
more than a million Home Equity Conversion Mortgage, or reverse
mortgage, loans since the program began in 1990. HUD expects the
program will have a negative value averaging $10.5 billion a year until
2023, putting a strain on its reserve fund.
New reverse mortgage loans*
Estimated negative value
120,000 loans
$0 billion
100,000
–2
80,000
–4
60,000
–6
40,000
–8
20,000
–10
0
–12
FY 1990
2000
’10
2017 ’18 ’19 ’20 ’21 ’22
’23
*2017 numbers through July Note: Fiscal years end Sept. 30
Source: Department of Housing and Urban Development
THE WALL STREET JOURNAL.
by the Federal Housing Administration, which is part of HUD.
Most new borrowers will
pay bigger premiums upfront
but lower ones over the life of
the loan, lessening the risk to
taxpayers if seniors live longer
than predicted. Borrowers will
now pay 2% of the amount of
the home’s value upfront and
0.5% annually over the course
of the loan.
Currently, most borrowers
pay 0.5% upfront and 1.25%
annually over the remainder of
the loan. On balance, most seniors will also be able to borrow less money.
The FHA’s reverse-mortgage program allows seniors
to take out loans from private
lenders against their homes to
supplement pension income
and help those on fixed incomes deal with unexpected or
rising expenses. When the
borrower moves or dies, the
proceeds from the home’s sale
are used to repay the loan.
But the program also carries
significant risks for the federal
government, which backs the
loans. The FHA covers the
losses on the loans from a reserve fund that is supported
primarily by premiums paid by
younger borrowers on traditional FHA mortgages. Since
2009, the reverse-mortgage
program has drained nearly
$12 billion from that fund.
“You have this cross-subsidy from younger, less-affluent people who are trying to
achieve homeownership,” said
Adolfo Marzol, a senior adviser at HUD.
In 2013, FHA required a
one-time $1.7 billion Treasury
appropriation, largely because
of losses from the reversemortgage program.
Lenders use actuarial tables
to determine how much borrowers are eligible to receive.
But making predictions for 15
to 20 years in the future is an
inexact science and the loans
can end up losing money if
home-price growth is slower
than expected, seniors don’t
keep the homes in great repair,
or they live longer and more
interest accrues on the loan.
Without changes, federal
officials say that the program
is placing an increasingly large
burden on the reserve fund
and within the next couple of
years FHA would require an
appropriation from Congress
to keep backing reverse mortgages. It is also indirectly
hurting HUD’s ability to lower
premiums on forward mortgages by putting pressure on
the reserve fund, officials said.
Advocates for the reversemortgage program say it is a
critical resource for some seniors. “Being able to survive
retirement when you don’t
necessarily have a large
401(k), that creates the real
risk of just being able to pay
the bills and eat food and stay
in a home,” said David Stevens, president of the Mortgage Bankers Association and
a former FHA commissioner.
BY TED MANN
The White House said it
would halt a planned Obamaera rule that would have required businesses to begin collecting data about how much
they pay workers of different
genders, races and ethnic
groups, saying Tuesday that it
posed a burden to employers.
The data-collection requirement was proposed by the
Obama administration in 2016
as part of its efforts to address pay disparities among
workers of different groups.
The Trump administration
will stay implementation of
the rule, which would have required employers to report the
pay data for the first time in
the spring.
“It’s enormously burden-
The data-collection
rule was proposed
by the Obama
administration.
some,” said Neomi Rao, administrator of the Office of Information and Regulatory
Affairs, which analyzes the
cost of federal rules and regulations. “We don’t believe it
would actually help us gather
information about wage and
employment discrimination."
The Obama administration
proposal directed the Equal Employment Opportunity Commission to begin collecting wage
and pay data from private employers with 100 or more employees and federal contractors
with 50 or more employees. The
proposal effectively expanded
the range of data employers
were required to report beginning this year on a form called
the EEO-1. That form has been
used for decades to collect information on the racial and gender makeup of the workforce.
The Obama administration
said the proposal would better
allow the EEOC to analyze and
combat pay discrimination.
In a memo, dated Tuesday,
to Victoria Lipnic, the acting
chairwoman of the EEOC, Ms.
Rao said the White House Office of Management and Budget would stay the rule and
conduct a review.
Advocates for the Obamaera policy defended it in recent months, saying that efforts to measure the problem
of pay discrimination had been
hampered in the past because
pay information largely arose
anecdotally.
—Lauren Weber
contributed to this article.
U.S. WATCH
ECONOMY
ILLINOIS
Consumers Display
Strong Confidence
State Looks to Alter
Chicago Policing
A measure of consumer confidence rose in August to the second-highest reading since late
2000, a positive sign for consumption growth in coming months.
The Conference Board on
Tuesday said its index of consumer confidence rose to 122.9 in
August from a revised 120 in July.
The index in March hit 124.9,
its highest level since December
2000. Despite sliding downward
from the March high in recent
months, the index has remained
at high levels, buoyed by labormarket strength and stock prices.
Consumers stating jobs are
“plentiful” rose to 35.4% in August
RICHARD B. LEVINE/NEWSCOM/ZUMA PRESS
BY LAURA KUSISTO
Expanded
Pay-Data
Disclosure
Is Halted
The labor market and stocks have supported consumer confidence.
from 33.2% in July, while those
claiming jobs are “hard to get” decreased to 17.3% from 18.7%. The
favorable outlook comes against
the backdrop of a 4.3% July unemployment rate, tying a 16-year low.
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“The labor market is definitely the primary reason for the
increases in confidence we’ve
seen,” said James Bohnaker, an
economist at IHS Markit. With
the accumulation of job and income gains, “people are feeling
pretty good,” he said.
—Sarah Chaney
CORRECTIONS AMPLIFICATIONS
The National Flood Insurance Program could be inundated with claims totaling billions of dollars following
Hurricane Harvey. A U.S. News
article Monday about the flood
insurer incorrectly said the
program could receive billions
of new claims.
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 Illinois attorney general filed a lawsuit that will enforce changes to policing in Chicago through court order, citing
the unwillingness of the Trump
administration to pursue a similar step after a Justice Department investigation of the Chicago Police Department.
The lawsuit, filed by Democratic Illinois Attorney General
Lisa Madigan, will start a negotiation process to reach a consent
decree for changes within the department. These decrees are typically negotiated between cities
and the Justice Department, and
were used under the Obama administration to change practices
within police departments including Baltimore and Ferguson, Mo.
“We are essentially stepping
into the shoes of the Department of Justice, shoes that the
DOJ has abandoned,” said Ms.
Madigan in a news conference
announcing the lawsuit Tuesday.
Attorney General Jeff Sessions said this year that the
Justice Department will pull
back on such probes, believing
that they overextend the reach
of the federal government into
local policing and would undermine respect for police officers.
In a statement Tuesday, a
Justice Department spokesman
said policing is “first and foremost a matter of local responsibility.”
—Shibani Mahtani
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | A3
* * * *
U.S. NEWS
Pressure Grows to Fund Health Program
BY STEPHANIE ARMOUR
WASHINGTON—State officials increasingly worry that
this year’s turbulent healthcare politics could threaten
funding for the Children’s
Health Insurance Program, a
popular initiative that usually
wins broad bipartisan support.
Federal funding for CHIP is
set to end Sept. 30. The federal-state program provides
health coverage to more than
eight million low-income, uninsured children whose family
incomes are too high to qualify for Medicaid.
Republicans are looking to
possibly attach a repeal of Af-
fordable Care Act taxes—including levies on certain
health insurance plans and
medical devices—to a CHIP reauthorization bill, people familiar with the thinking said.
Members of both parties
have also discussed using the
CHIP bill to extend payments
to insurers under the ACA.
The risk, lobbyists and state
health officials say, is that
such brinkmanship could endanger quick passage of a
funding reauthorization.
When Congress returns to
Washington next week after
its August recess, it isn’t clear
how hard lawmakers will push
to attach measures to the
CHIP bill. But some state officials are worried enough that
they already are looking at
whether they may have to
wind down their programs if
Congress fails to reauthorize
the funding.
CHIP at a Glance
Serves more than eight
million uninsured children
About $16 billion allotted
to states in fiscal 2017
Federal funding set to end
Sept. 30 if not extended
CHIP has earned bipartisan
support from the outset. Sen.
Orrin Hatch (R., Utah), now
chairman of the Senate Finance Committee, was a chief
sponsor of the 1997 CHIP leg-
ANDREW HARRER/BLOOMBERG NEWS
Congress faces
deadline for system
that serves millions of
low-income children
islation along with the late
Democratic Sen. Edward Kennedy of Massachusetts.
Mr. Hatch is working with fellow lawmakers and the Trump
administration to find a way to
ensure funding is provided, a
committee spokeswoman said.
“There is a bipartisan desire
within the Finance Committee
to ensure funding for CHIP is
continued and services for vulnerable children are maintained,” the spokeswoman said.
The uncertainty reflects the
political dynamic after the
failure of the hard-fought Republican effort to topple most
of the ACA.
CHIP supporters face other
obstacles. Congress must pass
a broad spending bill by the
end of September to avoid a
partial government shutdown,
and lawmakers also face pressure to raise the government’s
debt limit in coming weeks.
Illinois Approves School Funding
BY QUINT FORGEY
Gov. Bruce Rauner, left, with State Rep. William Davis, after the Legislature passed the funding bill.
racked up a $14.6 billion backlog of unpaid bills and devolved into the worst state financial crisis since the Great
Depression.
That stalemate came to an
end just last month, after the
Legislature overrode the governor’s veto to pass a $36 billion spending plan. The most
recent debate over school
funding, the last remaining
piece of the budget, began
three weeks later and was
similarly fraught with infighting between the governor and
the General Assembly.
The new funding formula,
which originally had been vetoed by Gov. Bruce Rauner,
won his support after legislative leaders added various
concessions, including $75
million in income-tax credits
for those who donate money
to private school scholarships.
“For far too long, too many
low-income students in our
state have been trapped in underfunded, failing schools,”
Mr. Rauner said in a statement
Tuesday. “We have put aside
our differences and put our
Honoring the Victims of a New Mexico Shooting
kids first. It’s a historic day
for Illinois.”
The tuition scholarship tax
credit was a tough sell for
Democrats, but party leaders
were successful in rallying
enough votes in support of the
new measure.
“This is what compromise
looks like. This is it. A bill that
none of us like at 100%,” said
Democratic Sen. Kimberly
Lightford. “This is what we
needed to do to fix a flawed
system.”
—Heather Gillers
contributed to this article.
Special Counsel Robert
Mueller has subpoenaed the
spokesman for former Trump
campaign chairman Paul
Manafort, demanding records
related to his work for Mr.
Manafort and seeking his testimony before a federal grand
jury, according to a person familiar with the matter.
Jason Maloni was served
Monday night with a subpoena
seeking all records related to
his work for Mr. Manafort
since 2010. Mr. Maloni has
represented the political consultant only since March, so it
wasn’t clear why the subpoena
extends back that far.
Mr. Maloni, who is president of his own public relations firm—JadeRoq, based in
Bethesda, Md.—was told to
turn over the records to prosecutors and to appear soon
before a federal grand jury in
Washington, the person said.
In a statement, Mr. Maloni
said he “would like to get the
advice of counsel before commenting publicly.”
Peter Carr, a spokesman for
Mr. Mueller’s office, declined
to comment.
CNN first reported that Mr.
Meuller had subpoenaed Mr.
Maloni. The network also reported that a former lawyer
for Mr. Manafort, Melissa Laurenza, had received a subpoena. Ms. Laurenza couldn’t
ADOLPHE PIERRE-LOUIS/THE ALBUQUERQUE JOURNAL/ASSOCIATED PRESS
be reached for comment.
Mr. Maloni’s subpoena was
served about a month after
federal agents working with
Mr. Mueller raided one of Mr.
Manafort’s homes pursuant to
a search warrant. That warrant was served on July 26 at
Mr. Manafort’s residence in Alexandria, Va., seeking documents and other material tied
to foreign bank accounts and
tax matters, according to people familiar with the probe.
The special counsel’s office
is exploring whether Mr.
Manafort engaged in potential
violations of lobbying and
money-laundering laws, according to people familiar
with the matter. Mr. Manafort
has maintained he has done
nothing wrong.
It isn’t clear how the latest
subpoena is tied to Mr. Mueller’s broader investigation into
Russian interference in the 2016
election. Mr. Mueller, is probing
whether any Trump associates
cooperated with the Kremlin to
influence the election.
According to the U.S. intelligence community, the meddling was directed by the
highest levels of the Russian
government, with tactics that
included hacking into state
election systems, stealing and
leaking information from
party committees and political
strategists, and disseminating
negative stories about Democratic nominee Hillary Clinton.
In Miami, a New Debate
Erupts Over Flashy Statue
MIAMI—This city’s appetite
for the garish is being tested.
After an investment group
including former New York
Yankees captain Derek Jeter
signed a deal to buy Miami’s
baseball team, residents have
renewed a debate over
whether to get rid of a massive, kitschy sculpture that
sits behind center field at the
Marlins’ stadium.
The 73-foot-tall structure—
an explosion of pink flamingos, blue marlins and green
palm fronds—has drawn derision since it was installed at
Marlins Park in 2012.
Whenever slugger Giancarlo
Stanton or one of his teammates hits a home run, the
mechanized piece whirs to life,
marlins circle, bright lights
flash and jets of water shoot
in the air.
Discord flared again in the
wake of a recent report on the
FanRag Sports website stating
that the Marlins’ new owners
are weighing whether to ditch
the sculpture. The investment
group signed a $1.2 billion
deal to buy the franchise this
month.
Mr. Jeter’s group declined
to comment on the matter.
The debate has played out
on social media and sports
websites, prompting some
county officials to chime in,
but it hasn’t resulted in any
action so far.
It is one of a host of disputes over public art that have
erupted over the years. Last
BRACE HEMMELGARN/MINNESOTA TWINS/GETTY IMAGES
BY ARIAN CAMPO-FLORES
MOURNING: People hung purple ribbon across the street from the public library in Clovis Tuesday, a
day after authorities say a teenage gunman killed two people and wounded four others in the library.
Some Republicans say the
reserves mean there isn’t an urgent need to reauthorize funding. But some state officials say
they would run out of money
sooner than projected.
Virginia is estimated to exhaust its federal funds in
March, but due to its payment
procedures the state’s CHIP
program would actually wind
down in January, said Linda
Nablo, chief deputy director
for the Virginia Department of
Medical Assistance Services.
Families would get a 60-day
notice that their coverage was
ending, she said.
More than 121,000 children
are covered in Virginia, including 1,100 with cancer. About
70,000 would be at risk of losing coverage at January’s end,
she said. “We have kids in the
middle of lifesaving treatment.
What do we say to those families?” said Ms. Nablo.
Mueller Subpoenas
Manafort Aide
BY DEL QUENTIN WILBER
JUSTIN L. FOWLER/ASSOCIATED PRESS
The Democratic Illinois Legislature gave final passage to a
new K-12 school-funding formula Tuesday, closing the
door on a summer of budget
turmoil that saw the end of a
fiscal standoff with the state’s
Republican governor but
didn’t resolve other long-term
issues.
The new formula will distribute taxpayer dollars to the
state’s neediest school districts first, provide more
money for Chicago’s hardpressed schools and get funds
flowing to more than 850
school districts that have already missed two rounds of
state aid payments.
Still, the flurry of legislative
action over the past few
months, including a $5 billion
income-tax increase to help dig
the state out of a huge budget
hole, won’t do much to address
larger financial problems in Illinois, which has the lowest bond
rating of any state.
Years of skimping on retirement obligations have left the
state with roughly $250 billion
in pension debt—the worst in
the nation, according to
Moody’s Investors Service.
School districts are owed an
additional $1.2 billion following a more than two-year budget standoff.
Many lawmakers likened
the enormity of the state’s
school-funding woes to Illinois’s record-breaking fiscal
impasse, which left the state
without a budget for 736 days,
CHIP is authorized through
2019, but federal money for the
state portion of the program
isn’t. Congress last reauthorized that funding in 2015 for a
two-year period that ends Sept.
30. In fiscal 2017, federal CHIP
allotments to the states came
to roughly $16 billion.
States have some cushion if
the federal funding is delayed,
with unspent federal funds redistributed to states that have
used up their allotment covering some of the shortfall.
Arizona, Minnesota, North
Carolina and Washington, D.C.,
would run out of their federal
CHIP funding by December, according the Medicaid and CHIP
Payment and Access Commission, or MACPAC, a nonpartisan
legislative agency that provides
analysis and recommendations
to Congress. An additional 27
states would exhaust their federal funds by March.
The 73-foot-tall structure has
drawn derision since it was
installed at Marlins Park in 2012.
year, New York City officials
installed a sculpture on a
street in Long Island City of a
bright pink reclining figure
called “The Sunbather.” Detractors dubbed it “Gumby’s grandmother” and “pink poop,” and
complained about everything
from the color to the cost.
In Chicago, a 26-foot-tall
sculpture of Marilyn Monroe
placed temporarily in a downtown plaza in 2011 triggered a
backlash over its depiction of
the actress in her famous pose
from “The Seven Year Itch,”
holding down her flapping
dress. Critics called it tacky
and lamented the hordes of
visitors shooting pictures from
between her legs.
Fans of the Marlins sculpture—named “Homer” and
created by American pop artist Red Grooms—say its effusion of colorful flora and fauna
captures the essence of the
team’s hometown. Mr. Grooms
didn’t respond to messages
seeking comment.
The sculpture “is kind of
gaudy,” said Jimmy Ross, a 35year-old longtime Marlins fan.
“That’s Miami to me.”
Others consider it an eyesore and are pleading for its
removal.
“I think it’s hideous,” said
Jesse Acosta, 33, also a longtime
fan of the team. “It looks too
cartoonish….Every time I’m at a
game, I look out there and say,
‘They’ve got to take it down.’ ”
Michael Spring, director of
the Miami-Dade County Department of Cultural Affairs,
which covered the sculpture’s
$2.5 million cost with funds
set aside for public art under
an ordinance, said the piece
isn’t going anywhere. The
county owns the stadium and
various art installations located there, including the
sculpture. “They’re permanently integrated into the fabric of the building,” he said.
Miami-Dade’s Art in Public
Places program, created in
1973, is one of the nation’s
oldest and has won awards.
The Marlins sculpture has
been one of the more controversial pieces. Miami-Dade
Mayor Carlos Gimenez is a fan
of the county’s public art, “but
of ‘Homer’ the sculpture—not
so much,” said Michael Hernandez, his communications
director.
A4 | Wednesday, August 30, 2017
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*****
HARVEY’S DESTRUCTION
Trump Views Damage, Lauds Response
BY MICHAEL C. BENDER
President Donald Trump
praised the response to Tropical Storm Harvey, saying federal and local officials have
become “a real team,” as lifesaving missions continued in
southeast Texas.
“We want to do it better
than ever before,” Mr. Trump
said Tuesday about the relief
efforts. “We want to be looked
at in five years, 10 years from
now, as this is the way to do it.”
Mr. Trump made his re-
marks from inside a firehouse
in Corpus Christi, a Gulf Coast
city about 200 miles southwest of Houston. The president received a briefing on relief efforts from local officials
and nonprofit groups in Corpus Christi, and again later
from state officials in Austin.
Brock Long, the Federal
Emergency
Management
Agency administrator, described a dire situation to the
president and said the priority
remained rescuing Texans
from the flood. Discussing the
Houston convention center,
which is sheltering residents,
Mr. Long said: “This is not the
Superdome.” He was referencing the dangerous conditions
that developed at that facility
after Hurricane Katrina struck
New Orleans in 2005.
Mr. Trump praised FEMA’s
work with local officials. “You
have been just outstanding,”
Mr. Trump said. “And I can tell
you that my folks are telling
me how great your representatives have been in working together. It’s a real team.”
After the briefing, the president addressed a crowd of
several
hundred
people.
“Texas can handle anything,”
he said, waving a state flag.
“What a crowd, what a
turnout,” he said.
The president traveled on
Air Force One with his wife,
Melania. White House Chief of
Staff John Kelly, Deputy Chiefs
of Staff Joe Hagin and Dina
Powell, press secretary Sarah
Huckabee Sanders and Marc
Short, the president’s legislative-affairs director, also ac-
companied the president.
After arriving in Corpus
Christi, the presidential motorcade passed broken trees,
fallen signs and fences askew.
“No one has ever seen anything like this,” Mr. Trump
said.
While he praised his cabinet and local officials, he
warned that he “won’t say
congratulations.”
“We’ll congratulate each
other when it’s all finished,”
he said.
On Monday, Mr. Trump said
he expects Texas to recover
fully from Harvey and anticipated that “you’re going to see
very rapid action from Congress” in the form of disaster
relief funds.
Vice President Mike Pence
is also scheduled to visit
southeast Texas this week, he
said in an interview Tuesday
with a Corpus Christi radio
station. He said there were
more than 8,600 federal officials on the ground in Texas,
who were being coordinated
by FEMA.
Continued from Page One
aren’t covered, and maximum
payouts for damages haven’t
risen since 1994.
In last year’s April flood in
Houston, Mr. Pontez’s damage
exceeded the $500,000 insurance maximum on most of his
affected
buildings.
The
$500,000 maximum in coverage for equipment and other
contents fell more than
$200,000 short of losses at the
turbine business. The policy
didn’t cover any losses related
to being closed.
The need for flood insurance
that works for businesses is
more dire because devastating
storms are hitting the U.S. with
increasing frequency.
Twenty storms causing a
billion dollars or more in damage have taken place since
2010, not including Hurricane
Harvey, compared with nine
billion-dollar floods in the full
decade of the 1980s, according
to inflation-adjusted estimates
from the National Oceanic and
Atmospheric Administration.
Seven have hit just since
2016, including October’s Hurricane Matthew and February’s
California flooding. A preliminary estimate on Tuesday by
Moody’s Analytics is that Harvey will cause up to $75 billion
in damages, with up to $25 billion of that in damages to businesses and lost economic output.
Less-severe flooding in monitored coastal towns has risen
an average of 30% over the
past five years and 150% over
the past 20, said William
Sweet, an expert on rising sea
levels at NOAA.
About 20% of NFIP claims
between 2006 and 2015 came
from outside areas considered
high risk for flooding, the Federal Emergency Management
Agency, which manages the
flood insurance program, told
Congress this year. Businesses
can have some losses offset by
community funds and other
programs.
A FEMA advisory committee
said in a 2015 report that increased development in floodplains, sea level changes and
changing climate patterns have
resulted in greater flood damages.
When a freak storm dumped
a torrent of rain on Ellicott
City, Md., last summer, more
than 5 feet of water swept
through the Bean Hollow cafe,
destroying a coffee roaster,
brewers, grinders and espresso
machines. Floodwaters burst
through one wall, damaged
joists under the building and
gutted the electrical wiring and
plumbing.
Owner Gretchen Shuey
closed for more than eight
months to rebuild, spending
$250,000 and losing potential
revenue of $450,000.
Her federal flood insurance
payout was $109,000. She said
she was barely able to reopen
and had to depend on personal
savings and donations from the
community. She turned to Medicaid for her children’s health
care.
Ms. Shuey’s private insurance for other calamities would
have covered her lost business
if fire or a tornado had hit her
coffee bar and roaster in Ellicott City’s historic district. “If I
had burned down, I would have
had income for the last 8½
months,” she said.
Congress is supposed to reauthorize funding for the program’s next five years by Sept.
30. A Senate bill introduced
this year would direct the flood
program to study adding business-interruption coverage. A
separate House bill would make
flood insurance optional for
businesses that are required to
purchase coverage because of
their location in federally designated flood zones. A temporary reauthorization of three to
six months is possible, according to industry lobbyists, who
STEPHEN VOSS FOR THE WALL STREET JOURNAL (2)
INSURE
Main Street in Ellicott City, Md.’s historic district is now repaired after a freak rainstorm gutted it last year. Gretchen Shuey, below, closed her
cafe for over eight months to rebuild, spending $250,000 and losing potential revenue of $450,000. Her flood insurance payout was $109,000.
Growing Risk
The need for businesses to carry flood insurance has increased as
severe storms have hit the U.S. more frequently.
Number of 'billion-dollar'
floods*
Estimated cost of 'billiondollar' floods, inflation adjusted
5 floods
$200 billion
4
150
3
100
2
50
1
0
0
1980
’90
2000
’10
Number of less-severe floods†
500 flood days
say Harvey puts additional
pressure on Congress to make
sure the program doesn’t lapse.
FEMA is working with Congress to determine whether additional coverage should be
added, said Roy Wright, deputy
associate administrator for insurance and mitigation at the
agency.
Small businesses are a tiny
part of the program, but “local
economies would be able to recover more quickly” if more
firms had coverage, he said.
In part because of the inadequate products on the market,
nonresidential businesses ac-
The program was
primarily designed
for homeowners and
has had few updates.
count for just 1% of the NFIP’s
5.1 million policies; their $19.1
billion in insured flood losses
are a small part of the program’s total $1.24 trillion in
coverage.
Businesses are required to
get flood insurance by some
mortgage lenders when they
are located in areas the federal
government has determined to
be high flood risk.
The considerable cost and a
misunderstanding of potential
risks deter most small companies from buying flood coverage if it isn’t legally required.
Private insurers largely
abandoned the flood insurance
market following the Great
Mississippi River Flood of 1927,
one of the worst natural disasters in U.S. history. Damages
totaled $1 billion, or about onethird of the federal budget at
the time and the equivalent of
about $14 billion in today’s dollars.
For comparison, NOAA estimates damage from 2005’s
Hurricane Katrina, the costliest
U.S. natural disaster, to be $160
billion in 2017 dollars.
Over the years, big businesses could acquire flood insurance through customized
packages built to cover their
commercial insurance needs,
but homeowners and most
mom-and-pop companies were
left uncovered.
In 1968, Congress created
the federal flood program in an
effort to stem the rising cost of
providing emergency aid
through special disaster relief
programs and to encourage
sound land use. Flood policies
were designed to provide basic
coverage to help homeowners
and businesses get back on
their feet. Insurers say policies
haven’t kept up with overall
advances in the industry.
“The policy language hasn’t
evolved much from the late
1970s and early 1980s,” said
Don Griffin, a vice president
with the Property Casualty Insurers Association of America,
a trade group. He said that
since the federal government
program is “the only game in
town,” there is little competitive pressure forcing it to improve the product.
Private insurers have been
largely unwilling to write flood
insurance because of the catastrophic nature of flooding, the
difficulty of adequately predicting risk, and the fear that only
those at the greatest risk
would buy coverage.
Before Hurricane Harvey hit,
Mr. Pontez, the Houston business owner, called the flood
program “antiquated and in
desperate need of revision.”
Nearly 40% of holders of
nonresidential policies opted
for the maximum building coverage in 2016, according to
FEMA, up from 20% in 2000.
“The trend is pretty dra-
1980
’90
2000
’10
Increase in the number of
extreme rainstorms, totaled
over five-year periods‡
60%
400
40
300
20
200
0
100
0
1920
–20
’50
2000
1900
’25
’50
’75
2000
*Floods with damages exceeding $1 billion after adjusting for inflation †Days at 28 locations
when high-tide water level exceeded a threshold determined locally by National Weather
Service Weather Forecasting Offices ‡Storms with rainfall so severe that analysis shows they
are unlikely to happen on average more than once in a five-year period
Sources: National Oceanic and Atmospheric Administration (billion-dollar floods);
William Sweet, NOAA (less-severe floods); Kenneth E. Kunkel, North Carolina
State University (extreme rainfall)
THE WALL STREET JOURNAL.
matic,” said Erwann MichelKerjan of the Organization for
Economic Cooperation and Development Board on Financial
Management of Catastrophes.
“We interpret that as essentially demand for more insurance.”
William Wilder purchased
the maximum building and
contents coverage for his Piggly Wiggly supermarket in Kinston, N.C. But when Hurricane
Matthew caused the Neuse
River to flood last year, sending 2½ feet of water through
his store, losses totaled about
$1.5 million. The maximum
coverage is “just not enough,”
he said.
Graig Cone, a developer in
Cedar Rapids, Iowa, figures he
lost about $58,000 in expected
revenue from two restaurants
during the six days flooding
shut down the local business
district last September. “I feel
like there is definitely a gap
that needs to be filled somehow,” said Mr. Cone, who has
both federal flood insurance
and standard business-interruption coverage that doesn’t
apply in a flood.
Private insurers, who provide business-interruption coverage for other types of perils,
use tools such as audits and
data on local business conditions to better understand a
firm’s cash flow, said Rade
Musulin, a vice president for
the American Academy of Actuaries. The federal flood program’s approach, by contrast,
focuses more on understanding
the physical characteristics of
buildings and local flood conditions, and is less suited to measuring business losses, he said.
Lost sales and productivity,
which aren’t covered by the
federal program, and steps
taken to protect properties
from flooding, which are covered in a limited way, accounted for nearly 70% of the
more than $6 million in losses
reported by small and midsize
firms in Cedar Rapids after the
flood, according to a report released by the city in February.
Quinton McClain, co-owner
of Lion Bridge Brewing Co. in
Cedar Rapids, spent more than
$13,000 to protect his restaurant and brewery from the
flooding. His staff piled sandbags, boarded up windows and
carted out furniture and
kitchen equipment, and he
hired plumbers to disconnect
brewing equipment and plug
drains.
“We were only able to claim
up to $1,000 of those expenses
for flood preparation,” said Mr.
McClain. “It’s kind of crazy, but
that’s the way it works.”
Small businesses also felt
coverage gaps in the case of
Superstorm Sandy, which
caused an estimated total of
$70.2 billion in damage mostly
along the Atlantic Coast in
2012, according to NOAA.
More than half of small
businesses in New York, New
Jersey and Connecticut that
had flood insurance and suffered damages received no insurance payout, according to a
2016 study by the University of
Pennsylvania’s Wharton School
and the Federal Reserve Bank
of New York. An additional 31%
recouped only some of their
losses, the study said.
Among those receiving no
payout, 60% suffered a loss of
customers, while 20% were hit
by utility outages, according to
an analysis conducted for The
Wall Street Journal by the
study’s lead author, Benjamin
Collier. Overall, businesses
were more than twice as likely
to have suffered customer
losses than physical damage.
“People were insured for different losses than what Sandy
created,” said Mr. Collier, now
an assistant professor at Temple University’s Fox School of
Business.
“The private sector is putting its toe in the water” in “a
very nascent private market,”
said Charles Symington Jr., senior vice president at the Independent Insurance Agents &
Brokers of America, a Washington, D.C.-based trade group.
Advances in flood mapping and
analytics now make it possible
to measure risk more accurately, he said.
But low prices of the federal
program make it difficult for
the private market to develop,
he said. Rates are subsidized
for some properties to encourage participation in the federal
program. Congress began phasing out subsidies for businesses
in 2016.
Private insurers also face
higher costs for capital and
must build large reserves to
cover potential payouts, and,
unlike the federal program,
they face demands to make
profits.
Until 2004, the federal flood
program collected enough in
premiums to cover most
claims. It fell deeply into debt
following Hurricane Katrina,
when it paid out $16.3 billion.
It added to losses after Hurricane Ike, in 2008, and Superstorm Sandy, and currently
owes the U.S. Treasury $24.6
billion.
The federal government
hasn’t yet calculated the potential financial impact on the
flood-insurance program of
Harvey. The flood program has
roughly 444,000 flood policies
in potentially affected counties
in Texas and more than
490,000 in Louisiana, a FEMA
spokeswoman said.
Those facing the greatest
flood risk are more likely to
take part in the government
program, making it harder to
balance risk and keep prices affordable by having a pool of
customers who are less likely
to make claims. The federal
program doesn’t have the flexibility of a private insurer to reject customers who are too
risky.
For Ms. Shuey, the coffee
bar owner in Ellicott City, community support proved crucial
to getting back on her feet. She
said customers built cabinets
free of charge and donated
countertop granite, flooring,
plumbing fixtures or cash. “A
good 40% of our costs were
probably covered by donations,” she said.
The outpouring helped persuade her to reopen at the
same site on Main Street, a district that helps anchor the
community.
“It was important to them
and to us,” she said. Still, she
added, “I can’t buy insurance to
protect myself. It doesn’t exist.”
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | A5
* * * *
HARVEY’S DESTRUCTION
Evacuees Face Fear and Overcrowding
Convention center is
filled to nearly double
capacity; ‘people are
doing their best’
51.8
Inches at one Texas rain gauge
since the storm started
BY DAN FROSCH
3,500
People rescued by National Guard
300
Animals saved by the Guard
9,100
Refugees at Houston’s
convention center
JOE RAEDLE/GETTY IMAGES
HOUSTON—Amid a sea of
cots, sleeping bags and stormweary
evacuees,
Joseph
Shives, Alyssa King and their
11-month old daughter Aspen
sat on a single air mattress,
peering around Houston’s
George R. Brown Convention
Center in bewilderment.
Less than 24 hours earlier,
during Tropical Storm Harvey’s onslaught, the roof of
their second-story apartment
caved in. Pounding rain and
water poured through, sparking an electrical fire. Ms. King
woke her husband, who
grabbed Aspen, and they
rushed out.
By Tuesday, Houston’s convention center was crammed
with 9,100 evacuees—nearly
twice as many as its 5,000person capacity.
Rows of cots filled the center’s several expansive rooms.
Among them were dozens of
beds fashioned from cardboard
boxes alongside carts overflowing with clothes, provisions
and keepsakes grabbed as the
floodwaters rose.
MaryJane Mudd, a spokeswoman for the Red Cross, said
more people were waiting to
get in and that she was concerned about “the comfort and
emotional health” of the people who were already at the
convention center.
“People are too tight.
They’re too close together. We
6M
Texans affected by 30 inches of
rain or more
People seeking shelter from Harvey’s floodwaters are sleeping on cots at the George R. Brown Convention Center in Houston.
know that,” Ms. Mudd said,
adding that more cots were on
the way.
Mr. Shives, 33, who works
at Jiffy Lube, said he had
stayed awake during their first
night at the shelter, keeping
watch to make sure Aspen and
his wife were safe because he
wasn’t entirely comfortable
with the mass of strangers
sleeping next to his family.
“It’s really crowded. Just
crowded,” Mr. Shives said. “I
think they’re a lot of people
here off the streets. It makes
you feel a little uncomfortable.”
Like her husband, Ms. King,
29, wasn’t at ease with their
circumstances. On the previous night, she had stepped
outside for a cigarette only to
find a man vomiting next to
her. Parts of the center reeked
of urine and amid the throngs
of families were also mentally
ill and homeless people.
Aspen, wide-eyed and
laughing, seemed content to
crawl around the air mattress
in her onesie. But her mother
still worried.
“People are doing their
best. The staff and volunteers
are really friendly but there’s
such a need,” she said.
Near a line of evacuees waiting to get into the shelter,
Bridget Whisenhunt, 27, skipped
to the front and made her way
over to a missing persons area.
Ms. Whisenhunt hadn’t
been flooded out of her home
but was searching for her 8year-old daughter, who had
left with Ms. Whisenhunt’s
mother and grandmother from
their northeast Houston home
before dawn Tuesday.
Ms. Whisenhunt heard from
a family member that they had
been taken to the convention
center. But she couldn’t reach
her family by cellphone and
had no confirmation they were
there. She and a friend who
had accompanied her to the
convention center said they
needed to see them and touch
them before they believed it.
After filling out a form with
Houston police, Ms. Whisenhunt was told to wait for 30
minutes. She found a place to
sit and fidgeted furiously.
“It’s my daughter. I don’t
know where she is at. I’m
shaking, I’m hurt, I’m frustrated,” she said.
Asked what she will do
when she is reunited with her
daughter, she said: “I’m going
to hold her, kiss her, love her
and cry. Then we are going to
get away from here.”
BY DEEPA SEETHARAMAN
AND GEORGIA WELLS
With local 911 systems
choked by calls during Hurricane Harvey, many Houston
residents tried going viral over
Facebook Inc. and Twitter Inc.,
one of the widest uses of social
media in a natural disaster.
Residents and their friends
and relatives used social-media tools to gain assistance
and call attention to sometimes life-threatening situations. Some users took the unusual step of sharing their full
names and addresses across
public channels like Facebook
and Twitter.
Others sought to tag news
outlets, journalists and other
prominent individuals in their
social-media posts in hopes
their messages would be
shared widely and eventually
answered.
“People have gotten used to
this idea that if you are stuck
HARVEY
Continued from Page One
Dickinson, a badly flooded area
southeast of the city.
President
Donald
Trump flew into Texas on
Tuesday, meeting with Gov.
Greg Abbott in Corpus Christi
near where Harvey first made
landfall. Mr. Trump praised Mr.
Abbott and the state’s response
to the storm.
The Pentagon said Tuesday it has identified as many as
30,000 troops to assist in a
massive military response, and
was awaiting a formal request
for assistance from Mr. Abbott.
The deployment would be in
addition to National Guard
units already working in the
state.
Mr. Abbott’s spokesman,
John Wittman, said the state
was working “hand-in-hand”
with the Pentagon and “deployment of additional National
Guardsmen will be announced
at the appropriate time.”
As Harvey moved offshore
Tuesday, and was expected to
make its way toward western
Louisiana, the greater Houston
area struggled to absorb the
floodwaters.
In some areas, 4 feet of water fell in five days, shattering
records and straining infrastructure. A bridge over Greens
Bayou in Harris County collapsed, the sheriff’s office said.
Up to 30% of Harris County has
been flooded, a spokeswoman
for the Harris County Flood
in an airport and you tweet at
an airline, sometimes they will
find a way to swoop down and
save you when the system
isn’t working,” said Ethan
Zuckerman, director of the
Center for Civic Media at the
Massachusetts Institute of
Technology. “People look for
anything else that might provide that salvation.”
Social-media experts said
the use of social-media platforms to gain attention for distress from the rising floodwater underscores the central role
those platforms play in spreading and consuming information.
Users’ reliance on social
media is amplified during crises, experts said, and was
compounded by the fact that
emergency hotlines were
jammed during the storm.
Some calls to Houston’s 911
operators were dropped or
failed to connect. Other residents said they were losing
battery power on their cell-
phones, making it difficult to
continue calling or hang on
the line for much longer.
In recent years, Facebook,
Twitter and other technology
platforms have allowed people
to track natural disasters and
acts of violence around the
world with speed and depth.
In 2014, Facebook launched
its safety-check tool, which allows users in emergencies to
mark themselves as safe on
their profiles and share other
information. Facebook users
activated the tool on Friday, a
company spokesman said in an
email. As of Monday evening,
users made nearly 900 requests for help and offered
help in more than 2,800 posts.
One Facebook user said
there was water in her Houston apartment, and published
her full address with apartment number. Another said a
friend in Corpus Christi, Texas,
needed baby food and formula
and the power was out. The
MICHAEL WYKE//EPA/SHUTTERSTOCK
Storm Victims Gravitate
To Social Media for Help
A man photographing the highway interchange of Interstate 10 in Houston on Sunday. Residents of
the city have used social-media platforms to seek help or flag life-threatening situations.
user said her friend received
help, but declined to be quoted.
Twitter’s public-policy team
maintains contact with government agencies around the
world, including those that
handle disaster relief.
During Harvey, first responders including the U.S.
Coast Guard and the Houston
Police Department have urged
people to call specific phone
Shelter From the Storm
Thousands of Houston-area residents evacuated to shelters as flood conditions persisted.
Open shelters High water along roads
Minor flooding Other
Flood gauges Major flooding
5 miles
G EO
E O RG E BUSH
IN T ERC
ERCO
ONT
TIIN
NE
EN
NTAL
TAL
AIR
P O RT
AI RP
Lake
Ho u sto n
8
69
6
HOUSTON
Addicks
R e s e rv o i r
45
610
10
G EO RG E R . B ROW
GEO
ROWN
N C
CO
O N VEN T IO N C
CEN
EN T ER
Barker
R e s e rv o i r
WILLIAM
WIL
LIA M
HO
P. H
O B BY
AII RP
A
R P O RT
288
Note: Data as of Tuesday afternoon
Sources: NOAA (flood gauges); Houston TranStar (high water); Google Crisis Response (shelters)
Control District.
Water breached brimming
levees and bayous, and officials
were forced to release even
more water from strained reservoirs into flooded neighborhoods.
Officials said Tuesday evening that the Addicks reservoir
had begun overflowing and was
causing additional flooding in
nearby neighborhoods. The
Barker reservoir is expected to
overflow later this week.
The storm could be responsible for as many as 10 deaths
across the state, including that
of a Houston Police officer who
perished as he tried to drive to
work.
At least 17,000 people stayed
in Red Cross shelters across
8
45
THE WALL STREET JOURNAL.
the Gulf Coast region on Monday night, according to the relief agency.
By Tuesday morning, the
blocks-long convention center
had been transformed into a
makeshift city, teeming with
tired families lugging the last
vestiges of their lives before
Harvey hit.
By midday, 9,100 people and
lines for disaster response,
rather than use social media
for help. The way social media
is used during emergencies
fluctuates rapidly, so crisis response agencies have a tough
time planning a proper socialmedia strategy, said Adrienne
Russell, professor of media,
technology and society at the
University of Washington.
Emergency response offi-
cials are using social media to
share information and make
requests. On Sunday, Houston
police used Twitter to ask anybody who could volunteer with
a boat to call. One Twitter
user responded over the platform to say a group of volunteers was having trouble getting through. Houston police
urged them to keep trying the
number.
countless pets called the center
home, nearly double its capacity, said MaryJane Mudd, a
spokeswoman for the Red
Cross.
Mayor Turner said that the
city has opened the Toyota
Center, home to the Houston
Rockets basketball team, to
help handle people who need
shelter and reduce the population of people sheltering at the
George R. Brown Convention
Center.
People will still go to the
convention center to seek help,
the mayor said. The Toyota
Center won’t be a site for direct entry.
“I want to reduce that population” at the convention center, the mayor said at a press
conference. “I don’t want it to
become so large it becomes difficult.”
Local and state officials
scrambled to coordinate a massive exodus to other Texas cities. Dallas, San Antonio and
Austin prepared what they
called “mega-shelters” to take
in thousands of Houstonians—
extending the flood’s impact
across the state.
Officials in Brazoria County,
south of Houston, said the levee at Columbia Lakes had
been breached and urged residents to flee the area. In Baytown, nearly 30 miles east of
Houston, police urged residents
to hang a white towel or sheet
out of their window if they
were trapped by rising water.
Weather forecasts offered
glimpses of hope for the region, as the storm and rain
headed eastward. But rescues
from high water continued.
Houston Police Chief Art
Acevedo said his officers had
performed over 3,500 rescues
so far and expected to continue
with rescue missions for at
least two more days before the
city shifts to a recovery mode.
Amid reports of rising rivers
and dwindling food supplies,
some residents risked flight
through watery roads.
Garson Li decided it was
time to leave Sugar Land after
he saw a two-hour line at his
local Kroger supermarket. On
Monday afternoon, he got into
his Honda CR-V and rolled
through foot-high water. Passing trucks pushed water over
his hood. An hour outside of
Houston on a small highway, he
felt the water push him toward
a ditch.
“My mentality was that if
we can’t get out now, we might
be in a situation where we run
out of water and food,” said
Mr. Li, who works as an auditor
at an energy company. After
five hours on the road, he
made it to Austin, where his
girlfriend lives. “The route I
took yesterday, it doesn’t exist
anymore,” he said. “I am very
lucky.”
Elsewhere in Texas, cities
prepared for a large number of
refugees from Houston—just as
Houston welcomed thousands
of people fleeing New Orleans
after Hurricane Katrina a dozen
years ago.
—Tawnell D. Hobbs
and Jon Kamp
contributed to this article.
A6 | Wednesday, August 30, 2017
* ***
THE WALL STREET JOURNAL.
WORLD NEWS
North Korea Launch Spurs Defense Plans
JIJI PRESS/AGENCE FRANCE-PRESSE/GETTY IMAGES; HONG GI-WON/YONHAP/ASSOCIATED PRESS (BELOW)
Moves by South Korea
and Japan are likely to
provoke Beijing,
complicating response
The international response to
North Korea’s nuclear threat has
shifted back to a military track
after Pyongyang’s latest missile
launch upended U.S. hopes for a
possible start of diplomacy.
By Jonathan Cheng
in Seoul and Alastair
Gale in Tokyo
Tuesday’s launch over Japan
has begun to bolster efforts by
Tokyo and Seoul to upgrade
their missile defenses, though
such moves would anger China
and Russia and complicate international coordination in tackling the threat from Pyongyang.
President Donald Trump reasserted that “all options are on
the table” in a statement that
marked a sharp turn from more
conciliatory remarks last week,
when he said that North Korea
had begun to respect the U.S.
and suggested the possibility of
a diplomatic solution.
North Korean leader Kim
Jong Un said early Wednesday
that the launch of the missile,
which North Korea named as
the Hwasong-12, didn’t threaten
any neighboring countries. In a
statement carried by state-run
Korean Central News Agency, he
called it a “meaningful prelude
to containing Guam,” the U.S.
Pacific territory that North Korea had threatened earlier this
month to surround with “enveloping fire.”
Mr. Kim also ordered his artillery unit to conduct “more
ballistic rocket launching drills
with the Pacific as a target in
the future,” suggesting that
Pyongyang is planning to launch
more missiles over Japan.
The launch was conducted by
an artillery unit tasked with
striking U.S. bases in the Pacific
theater, including Guam, and according to the North Korean
statement was a response to on-
South Korea soldiers took part in military drills this month. Above, Japan Prime Minister Shinzo Abe addressed the media after Tuesday’s launch.
Missile Tests Japan’s
New Alarm System
going joint annual U.S.-South
Korean military drills.
Tuesday's launch was one of
well over a dozen by North Korea this year, but it was also a
first: Mr. Kim had never before
sent a missile over a major foreign population center. It
prompted an outraged Tokyo to
call for an emergency United
Nations Security Council meeting. Chinese officials said
Pyongyang’s shot across the
Japanese mainland risks going
“past the point of no return.”
The Security Council adopted
a statement Tuesday condemning North Korea “for its outrageous actions” and called on it
to halt all weapons tests. The
statement didn’t spell out any
consequences for a refusal.
Japanese Defense Minister
Itsunori Onodera said Tuesday
that his ministry is seeking
funds for the introduction of Ae-
Across northern Japan, the
alarm jolted people out of bed
just after 6 a.m. local time.
Tuesday’s missile launch
marked one of the first tests
of a national government-run
warning system called J-Alert,
designed to disseminate warn-
ings about potential disasters,
natural and man-made. By
loudspeaker or cellphone, the
message was the same: “A
missile has apparently been
launched from North Korea.
Please take refuge in a sturdy
building or underground.”
The March 2011 earthquake and tsunami persuaded
nearly all local governments to
hook up to the system.
—Chieko Tsuneoka
gis Ashore, a land-based version
of a U.S.-made antimissile system used by some Japanese
warships. Tokyo said it tracked
the missile for its entire flight
but didn’t try to shoot it down
because it wasn’t on track to hit
Japanese soil.
Tuesday’s launch could ensure Seoul’s further deployment
of a U.S. missile-defense system,
Terminal High-Altitude Area Defense, or Thaad. South Korea’s
presidential office declined to
comment on plans.
South Korea is already in the
process of resuming deployment
of Thaad, which President Moon
Jae-in suspended after taking
office in May.
Beijing has said the Thaad radar would extend into northern
China and compromise its security. Russia opposes the deployment and last week criticized
possible new missile defenses in
Japan.
To demonstrate Seoul’s offensive capabilities, South Korean defense officials Tuesday
released footage of a new missile capable of flying about 500
miles. Even before Tuesday,
South Korea had been seeking
U.S. approval to revise an agreement capping the size and range
of its missiles.
The most muscular response
could be the reintroduction by
the U.S. of strategic assets to
South Korea, which typically refers to stealth bombers, aircraft
carriers or possibly nuclear
weapons.
The deployment of strategic
assets was one option mentioned by U.S. national security
adviser H.R. McMaster on a
phone call early Tuesday with
his South Korean counterpart,
according to a statement from
South Korea’s presidential office.
Japanese Foreign Minister
Taro Kono said North Korea
may have opted to fire the missile over northern Japan rather
than risk a response from the
U.S. if it had launched it in a
southerly direction over Japan,
toward Guam.
Japan operates Patriot missile-defense systems on land,
which are able to target missiles
in the final stages of descent.
The Aegis system, produced by
Lockheed Martin Corp., can
shoot down missiles at higher
altitudes. Japan has four naval
destroyers equipped with Aegis.
One Aegis Ashore unit would
cost around ¥80 billion ($730
million) and would need U.S.
government approval for the
sale. The Japanese cabinet
would also need to approve the
funds.
Japan has seven Patriot
PAC-3 missile defense batteries
on land-based mobile launchers,
which can be used to shoot
down ballistic missiles shortly
before they land, or below about
10 kilometers in altitude.
—Kwanwoo Jun,
Wayne Ma, Jeremy Page
and Farnaz Fassihi
contributed to this article.
FROM PAGE ONE
Join The Wall Street Journal’s editors at our
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the leaders who are shaping it.
Future Of: Smart Cities
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Continued from Page One
are encouraged by a season of
strong corporate earnings
while also focusing on issues
that threaten those gains, such
as coming debt ceiling negotiations and a run of uneven
U.S. economic data.
A stock market rally that
has run for 19 months without
a significant pullback has also
amplified concerns, pushing
some investors to allocate
more funds to assets considered safe.
While a decline in the currency is generally good for
corporate profits, the main
driver of stock-price gains
over the long haul, a steep decline in the currency over time
reduces people’s purchasing
power and holds down living
standards. A weaker dollar
helps U.S. exporters and multinational corporations by making their products more competitive abroad.
Some investors contend
that the retreat in the dollar is
alarming because it could
point to erosion in the credibility of U.S. institutions such
as Congress. Political leaders
now must deal with the fallout
from Tropical Storm Harvey as
well as deadlines to fund the
government and raise the federal borrowing limit.
Political divisions in the
U.S. and a turbulent start to
President Donald Trump’s
term in office have “created
uncertainty on the part of international investors who
would normally flee to the dollar at times of geopolitical uncertainty or crisis,” said Christopher
Sullivan,
chief
investment officer at the
United Nations Federal Credit
Union.
Mr. Sullivan said his team
has been buying longer-term
bonds in recent weeks given
expectations that “inflation is
likely to remain muted and
that the Fed would be forced
eventually to moderate its expected path of interest-rate increases,” though he is now
more cautious and is looking
for guidance from coming inflation and employment data.
Bets against the dollar in
futures markets soared last
PABLO MARTINEZ MONSIVAIS/ASSOCIATED PRESS
DOLLAR
Federal Reserve Chairwoman Janet Yellen
week to their highest level
since 2013, data from the Commodity Futures Trading Commission showed. Meanwhile,
net bullish bets that gold
prices will continue to rise
stood at 196,331 contracts, the
most since the week ended
Oct. 4, 2016.
And while U.S. shares rebounded Tuesday, political uncertainty has taken its toll on
stock funds.
Some $6 billion has flowed
out of U.S. stock funds since
mid-July amid concerns over
prospects for U.S. tax and
trade policy, the Institute of
International Finance said.
Global fund allocations to the
U.S. stand at their lowest level
in over 18 months, the group
said.
Federal-funds futures, used
Bets against the
dollar soared last
week to their highest
level since 2013.
by investors to place bets on
the Fed’s rate-policy outlook,
on Tuesday showed a roughly
32% chance of a rate increase
by December, down from 40%
Monday and 47% a month ago,
according to CME Group Inc.
data. While the Fed is expected to start slowly reducing
its large portfolio of Treasurys
and mortgage-backed securities in the fall, many investors
think the process will be slow
enough that it will have little
impact on markets.
“The liquidity available to
come into these markets is so
great that once investors figure out that an event won’t
change fundamentals, they are
willing to jump in and buy the
dips,” said Paul Christopher,
head global market strategist
at Wells Fargo Investment Institute. Mr. Christopher advises investors to stay the
course in a diversified portfolio of stocks, gold and various
currencies, rather than reacting to separate market events.
Many investors and analysts don’t see much on the
horizon that could change the
current direction of the dollar
and other assets. Some had
thought that Fed Chairwoman
Janet Yellen could use a
speech at the Fed’s annual
conference in Jackson Hole,
Wyo., last week to challenge
the prevailing view that interest-rates increases are on hold
for now. But Ms. Yellen instead
focused her remarks on regulatory policy, spurring a rally
in bonds and further weakening the dollar.
Accommodative
policies
from the Fed have played a
large role in bolstering both
bonds and stocks in recent
years to the point that some
analysts have warned of
stretched valuations and a
looming correction. Heading
such warnings, however, has
proved a losing bet.
Some analysts believe the
dollar could reverse at least
some of its losses if signs appear that the White House is
coming closer to pushing
through a tax overhaul or one
of its other fiscal initiatives.
“We have not given up yet
on U.S. tax reform and infrastructure spending,” analysts
at Bank of America Merrill
Lynch said in a note to clients.
They forecast the euro at $1.08
by year-end. Late Tuesday in
New York, the euro was at
$1.1974.
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | A7
WORLD NEWS
BY ROB TAYLOR
TIM WATTERS/SEA SHEPHERD AUSTRALIA/EPA/SHUTTERSTOCK
CANBERRA, Australia—Environmental activists here are
abandoning their annual antiwhaling campaign in the
Southern Ocean near Antarctica, saying Japan’s threat to
defend its fleet is too daunting.
Capt. Paul Watson, the
founder of anti-whaling group
Sea Shepherd, said Japan’s
threat to dispatch its military
was unprecedented.
“For the first time ever,
they have stated they may
send their military to defend
their illegal whaling activities,” Capt. Watson said in a
statement Tuesday. “The Japanese whalers not only have all
the resources and subsidies
their government can provide,
they also have the powerful
political backing of a major
economic superpower.”
The Japanese Embassy in
Canberra didn’t respond to
Sea Shepherd’s announcement,
but it previously accused the
group of sabotage and “acts of
violence which seriously endangered the safe navigation
of vessels.”
Some of Sea Shepherd’s
tactics include ramming whaling vessels and throwing stink
bombs onto the decks of Japanese ships. In January 2010,
one of Sea Shepherd’s boats
sank after a collision with a
whaling vessel.
The group’s decision to suspend its campaign after 12
years leaves Japan’s fleet free
to resume whaling through the
coming Antarctic summer
without disruption. Japan’s
whaling fleet last year reported killing 333 minke
whales, with plans to cull
about 4,000 whales over the
next 12 years under a quota
set by the Institute of Cetacean Research in Tokyo.
The International Whaling
Commission put in place a
moratorium on commercial
whaling in 1986. The next year,
Japan embarked on a cull that
it said was in the name of science, not commerce. Japan
says it has a right to monitor
whales’ impact on the fishing
industry, though it also claims
they are an important part of
its cultural and culinary heritage. Activists say scientific
whaling is aimed at circumventing the 1986 ban.
Last month, Japan’s parliament passed a series of laws
allowing for the protection of
commercial whaling fleets.
The International Court of
Justice ruled against Japan in
a scientific-whaling case in
2014. Canberra last month
said Japan’s new whaling laws
weren’t consistent with the
2014 ruling.
Three dead minke whales on the deck of the Nisshin Maru.
Myanmar Accuses Rebels
BY MYO MYO
AND JAMES HOOKWAY
YANGON, Myanmar—Myanmar security forces stepped up
their claims that Muslim militants were trying to take advantage of turmoil in the west
of the country by establishing
an Islamic state there, and accused international aid groups
of assisting them.
The country has come under widespread criticism for
its heavy-handed response to a
series of attacks on Friday,
when a small group of ethnicRohingya insurgents launched
what they called a pre-emptive
strike against security forces
in northern Rakhine State
where many members of the
stateless Muslim minority live.
Since then, more than 100
people, most of them insurgents, have been killed, and a
stream of Rohingya has
headed toward the border
with
Bangladesh,
where
80,000 of them already have
fled since a surge of violence
began in 2012.
On Monday, Pope Francis,
who plans to visit the country
in November, joined a growing
clamor for Myanmar to provide the group with “full
rights,” while United Nations
Secretary-General António Guterres expressed concern
about the worsening situation,
his spokesman said. Myanmar
authorities consider the estimated one million Rohingya
people to be illegal immigrants
from Bangladesh, and are subject to travel restrictions and
other curbs. Around 140,000
live in temporary camps after
communal clashes forced them
from their villages.
Their plight poses a dilemma for State Counselor
Aung San Suu Kyi, the Nobel
Peace Prize winner who now
serves as Myanmar’s de facto
leader. If she moves to provide
the Rohingya with more rights,
political analysts say she risks
incurring the wrath of Buddhist
hard-liners who have become
increasingly influential in
Myanmar since the political
opening that also brought Ms.
MOHAMMAD PONIR HOSSAIN/REUTERS
Foes of Whaling
End a Campaign
Rohingya rest at a makeshift shelter after crossing from Myanmar into Bangladesh at Cox’s Bazar.
Suu Kyi to power. It could also
worsen relations with Myanmar’s military, which still controls much of the government,
including the defense and interior ministries.
Instead, Ms. Suu Kyi appears to be siding with the
army, with her office releasing
a statement accusing international aid agencies of helping
Rohingya militants and commending the military action
around of Maungdaw, near the
border with Bangladesh.
Myanmar’s national security adviser, Thaung Tun,
meanwhile, said that there is
no ethnic cleansing under way
in Rakhine State, and that the
government intends to address
the issue of the Rohinya’s
statelessness. “The situation
in Maungdaw is extremely
complex and there are no easy
The government said
international aid
agencies are abetting
Rohingya militants.
or quick fixes.” he said.
On Tuesday, police Brig.
Gen. Win Tin told diplomats
that foreign groups were assisting the Arakan Rohingya
Salvation Army, which led Friday’s attacks and an assault on
police positions in October.
“This group aims to deteriorate the administration of
Maungdaw region and then establish an Islamic state in
Maungdaw,” Gen. Win Tin said.
Home Affairs Minister Lt.
Gen. Kyaw Swe told a briefing
that investigators had found
that some members of international aid agencies had provided the Rohingya ammonia
and fertilizers, which militants
subsequently used to make explosive devices. The U.N. is
evacuating all nonessential
staff from the region because
of the fear of reprisals.
The violence in Rakhine
State continues. Win Min, a
Muslim resident of Maungdaw,
said by telephone Tuesday that
soldiers set his home alight
and shot a friend. “It happened
after we were talking in the
road. After I went to our temporary shelter, the military
shot him. He shouted ‘help me,
help me,’ ” Mr. Win Min said.
When he turned back, he said
soldiers shot his friend again
and he ran away, not knowing
if the man lived or died.
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A8 | Wednesday, August 30, 2017
WORLD WATCH
WORLD NEWS
Russia Says Its
Military Exercise
Is Defensive Only
INDIA
Economists See Rise
In Quarterly Growth
Seoul Set to Increase
Spending Next Year
South Korea plans to boost
government spending next year
to fulfill left-leaning President
Moon Jae-in’s policy agenda, underpinned by an expected increase in tax revenue.
The national budget plan announced Tuesday by the Ministry
of Strategy and Finance calls for
a 7.1% rise in total spending for
2018 to 429 trillion won ($380
billion), up from a 3.7% increase
this year.
Revenue is expected to grow
7.9% next year to 447.1 trillion
won, compared with an expected
5.9% gain this year, the ministry
said.
The budget plan reflects the
SAINT’S DAY: A Muslim girl peers from behind a lattice window at the shrine of Mir Syed Ali
Hamdani, a Sufi holy man of the 14th century, during an annual religious festival in Srinagar, India.
Moon administration’s pledge to
keep its fiscal policy “expansionary” in the coming year to help
finance its agenda to create
public-sector jobs, expand social
welfare for the public, and boost
household incomes in a government-led push for economic
growth.
Mr. Moon, since taking office
in May, has passed a $10 billion
supplementary budget this year
and a 16% increase in the country’s minimum wage. The liberal
leader has also proposed a tax
revision, focused on higher levies
on wealthy people and big corporations.
The finance ministry expects
the country’s fiscal health to improve marginally next year, with
the fiscal deficit likely to be 1.6%
of gross domestic product—narrower than an expected 1.7% of
GDP in 2017. Government debt
is expected to edge down to
39.6% of GDP in 2018 from an
estimated 39.7% this year, it said.
—Kwanwoo Jun
GERMANY
TURKEY
19 Indicted in U.S.
Merkel Defends
For Attack at Protest Taking In Migrants
A grand jury in the U.S. capital has issued indictments for 19
people, including 15 identified as
Turkish security officials, for attacking protesters in May 2017.
The indictments, announced
Tuesday, charge the defendants
with attacking peaceful demonstrators who were protesting the
visit of Turkish President Recep
Tayyip Erdogan on May 17.
All 19 are charged with conspiracy to commit a crime of violence, a felony punishable by a
statutory maximum of 15 years
in prison. Several face additional
charges of assault with a deadly
weapon.
Sixteen of the defendants
had already been charged June
13; Tuesday’s indictment adds
three new defendants, all Turkish security officials.
—Associated Press
Chancellor Angela Merkel said
Tuesday that she did the right
thing by allowing large numbers
of migrants into Germany two
years ago and that Europe
hasn’t done enough to develop
long-term solutions to the migration crisis since then.
“It was important and right
that we took people in back
then in this exceptional situation, and it is also right that we
must find long-term, sustainable
structures,” she told reporters.
Polls suggest her popularity
has returned to levels from before 2015, when the refugee crisis reached its peak. They show
her conservative bloc leading by
13-17 points over her main challenger, Martin Schulz of the center-left Social Democrats, in Germany’s Sept. 24 elections.
—Associated Press
F-16s, but the U.S. is increasing
the size of its deployment because of NATO’s expectation of
increased Russian military operations. The U.S. will also deploy 140 airmen to Lithuania to
support the mission.
Russia is stationing a more
robust presence, including missiles and new army units,
moves it says are designed to
counter NATO deployments.
Gen. Fomin said Western
media and politicians had been
“spreading myths about the socalled Russian threat” in advance of the exercise, known as
Zapad 2017.
“The most unbelievable scenarios on how events will unfold are being offered,” he said.
NATO officials have cast
doubt on official Russian figures about the size of the exercise and complained about a
lack of transparency. In his
Tuesday briefing, Gen. Fomin
said a total of 12,700 service
members would be involved in
the exercise, the majority of
whom—7,200 troops—would be
from Belarus.
Gen. Fomin added that 70
aircraft and helicopters would
participate, along with 680
combat vehicles, including 250
tanks, and 10 warships.
The number of troops Russia
said is taking part remains under the threshold of 13,000 that
would require international observers to attend the drills.
MOSCOW—The Russian military dismissed Western concerns over a major war game
that has underscored Cold Warstyle tensions in the Baltic Sea
region, as the U.S. further
beefed up its presence there.
Russian Deputy Defense Minister Lt. Gen. Alexander Fomin
said Tuesday the joint-RussianBelarusian exercises, which will
take place in September partly
on Belarus’s border with NATO
members Lithuania and Poland,
would be of “a purely defensive
nature,” testing the ability of
troops to respond to a hypothetical adversary.
North Atlantic Treaty Organization officials have warned
the maneuvers, planned amid a
military buildup in the region
by the alliance and Russia, could
serve as a screen for Russia to
deploy more military equipment
and heighten the risk of an accident or miscalculation that
could touch off a crisis.
The U.S. has deployed a tank
brigade to Central and Eastern
Europe, part of a larger deterrent force covering NATO’s
eastern flank. On Tuesday, it
sent seven F-15C Eagle fighter
planes from a base in the U.K.
to Lithuania to take over
NATO’s Baltic air-policing mission from Poland, a larger-thannormal deployment of aircraft.
Poland had deployed four
KIRILL KUDRYAVTSEV/AGENCE FRANCE-PRESSE/GETTY IMAGES
SOUTH KOREA
BY NATHAN HODGE
DANISH ISMAIL/REUTERS
India’s economic growth likely
accelerated last quarter as the
return of the cash that had been
sucked out of Asia’s third-largest
economy reinvigorated demand.
Gross domestic product likely
expanded 6.6% from a year earlier in the three months ended
June 30, according to the median
estimate from a poll of 14 economists by The Wall Street Journal.
That compares with a 6.1%
expansion in the previous quarter, which was the slowest
growth in two years. The data
are due Thursday.
A result in line with expectations would mean India will have
ceded its title as world’s fastestgrowing large economy to China
for the second straight quarter.
China’s economy expanded 6.9%
in the past two quarters.
New Delhi’s move in November to withdraw 86% of the currency in circulation to dredge up
cash stashed illegally hurt demand early this year. The central
bank has been printing new bills
to return the amount of cash in
the economy to normal levels.
A 27% rise in government
spending helped power growth
during the quarter, particularly in
the public administration and defense sectors.
However growth likely slowed
in June because of confusion
over new tax rates and procedures under the Goods and Services Tax regime rolled out from
July 1.
—Anant Vijay Kala
THE WALL STREET JOURNAL.
* *****
Foreign militaries attend a briefing before the Zapad drill begins.
FROM PAGE ONE
Continued from Page One
Earth.”
Dr. Ashurbeyli, based in Moscow, has few details about how
Asgardia, named after Asgard,
the godly realm of Norse mythology, would be built,
launched and run. Specifics are
to be decided by the nation’s
parliament.
One mission: Guard against
space threats like asteroids. “My
task is to defend planet Earth
and defend humanity,” Dr.
Ashurbeyli said in a phone interview, “nothing more.”
Before liftoff, the Soviettrained engineer wants the
United Nations to recognize Asgardia as a country. He plans to
establish a government online
and devise a flag, anthem and
currency. Initially, citizens will
get to send data into space on a
satellite he plans to launch from
the U.S. this fall.
Dr. Ashurbeyli, who owns an
industrial company he values at
$200 million, insists he is
deadly serious. He is the sole
funder and pays about 50 people to manage Asgardia’s affairs.
His plan is to pay for launches
through crowdfunding.
Others are skeptical of the
UBER
Continued from Page One
pany, he’s an incredible visionary, so he will be involved with
the company going forward,”
Mr. Khosrowshahi said. “Exactly
how, exactly when, is something
that’s really up to Travis and the
board.”
The Justice Department has
taken preliminary steps to investigate whether managers at
Uber violated a U.S. law against
foreign bribery, according to
people familiar with the matter.
The agency is reviewing allegations that Uber may have violated the Foreign Corrupt Practices Act, which bans the use of
bribes to foreign officials to get
or keep business, these people
said.
Debate raged on other aspects of the constitution, from
its minimum age of 40 for parliamentarians to worries that
Asgardia would impose taxes
before launch. Such a levy, fretted one Asgardian online, would
mean citizens supporting a nation “that has few assets, no territory, no institutions and no international recognition.” The
constitution states that paying
taxes is voluntary.
Critics’ online clashes with
those loyal to the founder got
heated. The disputes delayed
Based on what it finds, the
Justice Department may or may
not decide to open a full-fledged
FCPA investigation into Uber. It
is unclear whether U.S. authorities are focused on one country
or examining activities in several countries where the company operates.
An Uber spokesman confirmed the company is cooperating with the Justice Department on the preliminary
investigation. A Justice Department spokeswoman declined to
comment.
The choice of Mr. Khosrowshahi was intended to bring stability to the world’s most valuable venture-backed startup
after a year of tumult. But at a
time when the ride-hailing company was supposed to be celebrating the end of its nine-week
CEO search, Ms. Whitman spoke
out on the selection process.
In a statement to the Journal
on Monday night, Ms. Whitman
said she hadn’t been a candidate
for the job until Friday, when an
Uber director she didn’t name
called to see if she would reconsider after the board couldn’t
decide between Mr. Immelt and
Mr. Khosrowshahi. Ms. Whitman had reiterated to the Journal Wednesday that she wasn’t
“going anywhere.”
Ms. Whitman said she laid
out her terms: Uber must
strengthen its governance structure, and Benchmark Capital,
one of Uber’s biggest investors,
must settle its lawsuit with Mr.
Kalanick over control of board
seats.
“By midday Sunday it was
becoming clear that the board
was still too fractured to make
progress on the issues that were
ratification of the constitution,
which was scheduled for June
18, for almost six weeks.
Of the over 300,000 who became Asgardians by signing up
online, only the 110,000 who finally voted to approve the constitution were granted official
citizenship.
Jenn Roznicki, 40, a childcare provider in Calgary, Canada, quit Asgardia when it was
revealed that those who didn’t
approve the constitution would
be considered tourists, not citizens. “I was sad that it hap-
pened because I had so much
hope for Asgardia,” she said.
“When I joined a year ago, my
husband said, ‘You know it’s going to descend into madness,’
and I said, ‘No, I have faith!’ ”
Dr. Ashurbeyli said he simply
wants to establish a more structured society and would serve
only one five-year term. As for
anointing himself king, he said
Asgardia would be a constitutional monarchy similar to those
in Europe.
He has created a Viennabased group—named NGO As-
JAMES VAUGHAN
SPACE
project’s success. “I think the
initiators don’t have any idea
what they are doing, legally
speaking,” said space-law professor Frans von der Dunk of
the University of Nebraska-Lincoln.
And earthbound Asgardians,
it turns out, are a fractious lot.
Hailing from Tulsa to Turkey to
East Timor, they speak different
languages and can’t agree on
basic policies. Hotly debated issues include the merits of establishing diplomatic relations with
extraterrestrials, whether refugees should be welcomed and
what role cryptocurrencies
should play.
The biggest fault line is Asgardia’s constitution, which Dr.
Ashurbeyli and his advisers
wrote. Unveiled in June, it met
opprobrium from rebellious corners of the would-be nation.
“I’d say the community is
very divided,” said Chris
Hawkes, 58, a teacher from
Preston, England, who joined
because he liked the idea of a
“societal restart.”
Mr. Hawkes said the constitution accords too much power
to Dr. Ashurbeyli by declaring
Asgardia a “Space Kingdom”—
giving him extensive rights to
determine the composition of
the powerful Supreme Space
Council.
One artist’s concept of how Asgardia, a proposed Earth-orbiting colony, might look.
important to me,” she said in
the statement.
Her sentiment echoed the
situation with Mr. Immelt, who
publicly pulled his name from
consideration early Sunday after making a formal presenta-
The choice of Mr.
Khosrowshahi was
intended to bring
stability to Uber.
tion to directors, apparently
spooked by what he felt was a
fractious and disorganized
board, according to a person familiar with his thinking. In particular, this person said, Benchmark wanted Mr. Kalanick off
the board and Mr. Immelt
wouldn’t say that the ex-CEO
should be removed. By Saturday
morning, Mr. Immelt planned to
withdraw his name, this person
said.
But people familiar with the
board’s deliberations say it was
clear the 61-year-old Mr. Immelt
wouldn’t have enough votes to
become CEO. So the recently retired GE CEO attempted to save
face by tweeting that he decided
not to pursue the job, these people said. Mr. Immelt wasn’t immediately available for comment.
Ms. Whitman, 61, has longstanding ties to Benchmark,
which has pushed for her candidacy, say people familiar with
the matter. The venture firm,
which has denied it was a prime
advocate for Ms. Whitman, led
the push for Mr. Kalanick’s
gardia—to manage the nation. It
is now holding parliamentary
elections, with almost 4,000
running for seats, with candidates including an Indian computer scientist and a British
hypnotherapist.
While some have fleshed-out
platforms advocating policies
from universal basic income to
building a virtual-reality-based
society, many haven’t bothered.
To join the U.N., Asgardia
needs Security Council blessing
and must persuade two-thirds
of member states “that it is a
peace-loving state and is able
and willing to carry out the obligations” of the U.N. charter, said
Dan Thomas, a U.N. spokesman.
Asgardia’s constitution is
available in 12 languages and
states it will “strive towards a
single Asgardian language”—a
subject of intense discussion
among Asgardians, with suggestions ranging from Esperanto to
a hybrid of Chinese and English.
Then there’s a vexing demographic problem. As of March,
16% of Asgardians were women,
prompting the organization to
call for members to find ways to
get more to join.
“We definitely need more
women,” said Samuel Fisher, 25,
a Colorado-based Asgardian and
book author, “but we’re not in
space right now.”
ouster in June after a series of
scandals rocked Uber, and sued
him last month.
Soon after pulling her name
from the running with a tweet
in late July, Ms. Whitman began
working to get back into consideration, the people familiar with
the board deliberations said.
And even as she said that she
no longer wanted the job, arrangements were being made
behind the scenes to present
her vision for the company,
these people said.
In a statement late Tuesday,
Uber’s board sent a note to employees announcing Mr. Khosrowshahi’s appointment, emphasizing the board vote’s was
unanimous. The company plans
to introduce him to employees
at an all-hands meeting in San
Francisco Wednesday morning,
the note said.
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | A8A
NY
* * * *
GREATER NEW YORK
Condo Defends
Confederate
Images in Lobby
Trending Up
At Mott Haven Academy Charter
School, the percentage of
students passing state tests in
spring has risen in most years
since 2013.
English language arts, grades 3
to 5 combined
40
New York City district schools
BY ZOLAN KANNO-YOUNGS
30
20
Mott Haven Academy
Charter School
10
0
2013
’14
’15
’16
’17
70%
60
50
40
30
20
10
0
2013
’14
’15
’16
’17
Source: New York City Department
of Education
THE WALL STREET JOURNAL.
CLAUDIO PAPAPIETRO FOR THE WALL STREET JOURNAL
Math, grades 3 to 5 combined
Kindergarten teacher Eric Lara talked with a foster child, at Mott Haven Academy Charter School.
School Helps ‘Margin’ Pupils
Bronx charter academy is designed for children in foster care or at risk of entering it
BY LESLIE BRODY
At Mott Haven Academy
Charter School in New York
City, fifth-graders start the
fall reading “Locomotion,”
the story of a boy in foster
care.
Every kindergartner gets a
teddy bear to keep in school
for comfort. And from time
to time, class parties celebrate a student’s adoption.
The Bronx charter is believed to be the first in the
U.S. designed for children in
foster care or at risk of entering it, often due to parental addiction, abuse or neglect. It tries to support
them with counseling and
trains teachers to be especially sensitive to their
needs.
“I feel an incredible responsibility,” said its founding principal, Jessica Nauiokas, “to make sure Mott
Haven Academy is an environment that does not let
kids down the way some
adults have in their past.”
Housed in a renovated
factory with a technicolor
dove painted one side, the
charter stands out in a lowincome area dotted with
public-housing projects.
On Wednesday, it will
open with a new middleschool division, and will
serve about 400 students in
prekindergarten through
sixth grade.
After a rough start in
2008, the academy has made
academic progress: Although
it teaches some of New York
City’s most vulnerable children, 59% of its students
passed state tests in math
last spring, beating the 42%
rate for the same grades in
the city’s regular public
Special Program
Improves Grades
A Mott Haven Academy
Charter School’s analysis
shows that its students from
foster homes fare much better
academically than foster children in New York City district
schools.
In fifth grade, for example,
58% of the charter’s students
in the child-welfare system
passed the New York state
math test in 2016, compared
with 8% of New York Foundling’s foster children who attended regular public schools.
New York Foundling’ is a nonprofit social-service agency
that opened Mott Haven Academy after seeing its foster
children flounder in traditional
public schools.
After years of climbing up-
ward, Mott Haven Academy
state test scores slipped
slightly last spring, to 37% proficient in English and 59% in
math.
Jessica Nauiokas, the principal, said faculty believed that
dip to be isolated and have
modified curricula and instruction to address it.
Bill Baccaglini, president of
the New York Foundling, said
that in many regular public
schools, busy teachers often
“teach to the middle” of the
ability range.
“My kids, because of all the
things that have happened to
them, don’t exist in the middle
of the room, they exist on the
margins,” he said. “Where you
have populations like this it’s
foolhardy to think the straight
academic program focused on
the 3 R’s will get them from A
to Z.”
—Leslie Brody
schools. The charter’s scores
in English almost matched
the city’s 40% pass rate.
The school helped K’jha,
now in fourth grade, face
deep disappointments, said
her adoptive mother, Sharon.
At one point when K’jha was
a toddler and still with her
birth parents, they were
homeless, sleeping on park
benches and rooftops.
Sharon said K’jha’s parents struggled with drugs
and incarceration, and the 9year-old treasures a card her
father made for her in
prison, a picture of Minnie
Mouse with sparkles.
Sharon became her foster
mother and then adopted
her. “A year ago K’jha
wanted to test me, she
thought I was keeping her
away from her parents,”
Sharon said. “She tried to
fight me, she said ‘I’m outta
here.’ But she had counseling
at school and outside and
she’s gotten so much better.”
The charter is a “safe haven, the children know that,”
Sharon added. “They’re
loved here, they’re wanted,
they’re special.”
About a third of the
school’s students are in foster care and a third are in
families that have been under the supervision of the
city’s Administration for
Children’s Services. Another
third come from families in
the neighborhood, where demand for seats is strong.
About 300 children were
in a lottery for 15 spots open
to kindergartners in the gen-
eral community for the coming school year.
Wyasia, a 14-year-old
graduate who was adopted
from foster care, said she
was grateful to go to school
with other students who understood what she had been
through. “Any time we would
get frustrated we would go
to each other,” she said.
Leaders at New York
Foundling, a nonprofit social
service agency, opened Mott
Haven Academy after seeing
its foster children flounder
in traditional public schools.
Paid for by a $27 million
capital campaign, the school
building also has some of the
agency’s medical and dental
clinics, therapists and caseworkers.
Experts say only 3% of
foster youth nationwide finish college. Getting shuffled
from one home to another—
sometimes several times a
year—can interrupt their education.
At Mott Haven Academy,
if children are moved to a
new address in the city the
school arranges emergency
transportation so they can
stay with the same teachers
and friends.
The charter spends about
$20,000 per student each
year. That includes $16,500
per pupil of taxpayer dollars,
with the rest coming from
the New York Foundling and
the charter’s own fundraising, a spokeswoman said.
Some charter critics say
they drain resources from
regular public schools.
The school’s start was
rocky. After five years, state
education officials approved
only a short-term renewal of
its contract, warning it must
Please see MOTT page A8B
New York City launched an
investigation Tuesday into allegations of tenant harassment
at a Queens building that has
Nazi names and Confederate
imagery in its lobby.
The Commission on Human
Rights is looking at whether
the display violated tenants’
civil rights or was intended to
harass them by creating a hostile environment.
The images at the 48-unit
condominium building on 39th
Place in the Sunnyside neighborhood include a cartoon depiction of an African-American
next to the words “The Original Jim Crow.” There are images of Confederate generals,
and also of the U.S. flag and
Uncle Sam. The names of Nazis
Rudolf Hess and Josef Mengele,
along with those of celebrities,
are in the directory posted at
the entrance of the building.
“That is a sick and twisted
and demented act,” City Council Majority Leader Jimmy Van
Bramer said in an interview
near the building. “They are a
very real and present-day attempt to intimidate the people
in that building.”
Jacob Laufer, an attorney
for the condominium board,
said the investigation would
find no harassment.
The images, Mr. Laufer said,
were approved by the condominium board “to reflect
American history,” noting they
include depictions and quotes
from Abraham Lincoln and Dr.
Martin Luther King Jr.
He said taken out of context, the images of Adolf Hitler
and other figures “can be jarring,” but they celebrate
“America’s historic victory in
World War II.”
Two Uncle Sam statues
flank the entrance of the
building, as well as several
American flags. The condominium directory has a random
collection of names of people
who aren’t tenants, including
rappers Biggie Smalls and LL
Cool J, among the Nazis.
Mr. Laufer said that an individual who previously made
false allegations against the
board “likely placed insulting
fake names” on the directory
A poster depicting a large
swastika and Hitler was torn
from the lobby’s walls on Sunday, according to Mr. Van
Bramer. He acknowledged that
not all of the signs may be
hateful but said some “are a
part of a pattern of intimation
and harassment.”
Confederate signs and symbols are currently the subject
of much debate after protests
and calls for their removals
around the country.
Condominium boards have
a right to decorate the lobby
of their buildings, Mr. Van
Bramer said, except “when
that free speech leaves people
in that building feeling terrified, in some cases for their
lives, you have clearly crossed
‘They are a very real
and present-day
attempt to intimidate
the people…’”
the line.”
If the investigation finds
there has been harassment,
the city can seek up to
$250,000 in civil penalties, according Hollis Pfitsch, the deputy commissioner of the law
enforcement bureau at the
Commission on Human Rights.
“There will be consequences from the city when we
identify violators,” Ms. Pfitsch
said.
One tenant of the building,
who declined to be named,
said the number of signs has
increased in recent months and
that has become “problematic”
for her and her husband.
“We have had conversations
in recent months of, ‘Can we
do this anymore?’ ” she said.
Evan Sweet, a 24-year-old
urban planner who lives
nearby, said he was disgusted
by what he saw.
“The person who put this
up has an argument that this a
whole framing of the political
history,” Mr. Sweet said. “But
I think clearly the way it’s set
up is to frighten or intimidate
or express one view of one
American history.”
MARK LENNIHAN/ASSOCIATED PRESS
50%
Some residents are upset by images in the Queens building’s lobby.
City Council Race Sparks Tensions
MARY ALTAFFER/ASSOCIATED PRESS
BY MARA GAY
Former New York state Sen. Hiram Monserrate, seen in 2010.
Hiram Monserrate, a former
New York state senator who
spent nearly two years in
prison for stealing thousands
in taxpayer money and who
assaulted his girlfriend, wants
to retake the Queens council
seat he once held.
“I paid the price for those
mistakes but none of us can
live in the past and none of us
are perfect, so we move forward,” Mr. Monserrate, said
Tuesday in a phone interview.
Mr. Monserrate, 50 years old,
is running against state Assemblyman Francisco Moya in
the Sept. 12 Democratic primary.
There is no public polling in
the race. City Council races
tend to have low turnout,
making them hard to predict.
Much of the political establishment is backing Mr. Moya. Yet,
Mr. Monserrate has high name
recognition, and Mr. Moya’s
supporters say they aren’t taking anything for granted.
“I think this may be the
highest-stake council race in
the city, both because of what
a strong council member Moya
will make and because of the
horror so many of us have at
the prospect of Monserrate returning to the chamber,” said
Mark Levine, a Democrat representing northern Manhattan.
Mr. Monserrate in 2012
pleaded guilty to misdirecting
about $100,000 in city money
toward his 2006 state Senate
campaign.
In 2009, he was convicted of
misdemeanor assault for a
2008 incident in which he
slashed his girlfriend in the
face with a piece of glass. Mr.
Monserrate
initially
was
charged with a felony, but the
charges were reduced when
the woman changed her account to say it was an accident.
Asked about the 2008 assault, Mr. Monserrate said he
had been “exonerated…of any
act of any intentional malice.”
Councilwoman Helen Rosen-
thal, co-chair of the Women’s
Caucus, said she would find it
difficult to serve with him.
Mr. Levine and several
other council members have
worked hard this summer to
help Mr. Monserrate’s opponent. The seat currently is held
by Councilwoman Julissa Ferreras-Copeland, a Democrat.
Democratic Mayor Bill de
Blasio has endorsed Mr. Moya.
Mr. Moya also has the backing
of the Queens County Democratic Party. “It’s a clear-cut decision,” Mr. Moya said in an interview. “You have an individual
who is a convicted criminal with
a violent past, versus someone
who has served honorably.”
Mr. Monserrate, a former
U.S. Marine and ex-police officer, is still a household name
in the district, which he represented from 2002 to 2008.
Mr. Monserrate has been
endorsed by the Black Leadership Action Coalition, the political arm of the Black Institute, a liberal, New York City-
based advocacy group.
On Tuesday, the Institute
filed a petition in State Supreme
court asking the city’s Board of
Elections to reinstate voting
sites that they said were removed this summer from LeFrak City, a large apartment
complex in Queens where Mr.
Monserrate is believed to have
substantial support.
Bertha Lewis, founder and
president of the Black Institute,
believes Queens Democratic
leaders pushed for the change
to hurt Mr. Monserrate and
break up a large voting bloc of
African-Americans.
“We know that this is trying
to hobble Hiram, but this is bigger than Hiram,” Ms. Lewis said.
U.S. Rep. Joseph Crowley,
chairman of the Queens Democratic Party, said that was untrue and that the sites had to be
moved to be in compliance with
the Americans with Disabilities
Act. A spokeswoman for the
Board of Elections didn’t immediately respond to comment.
A8B | Wednesday, August 30, 2017
NY
* *
THE WALL STREET JOURNAL.
GREATER NEW YORK
Virtual Reality Centers Take Flight
You can walk the
plank or fly over an
iceberg at a VR center
in New York City
The other day I made a terrible mess in my cubicle, flew
over an iceberg, and sliced
through floating watermelons
with my samurai sword.
No, I wasn’t high. I was visiting VR World NYC, a virtual
reality entertainment center
that opened this summer in
Midtown Manhattan. With a
$39 all-day pass, guests can
sample a buffet of VR experiences ranging from rock
climbing to a rainforest visit.
The multistory center, located in a former Bolton’s store
on 34th Street near the Empire
State Building, offers a series
of bays where guests donning
earphones, a headset and hand
controllers can battle ogres
and space aliens in sessions
lasting four to 15 minutes.
The place is definitely in
beta mode. The afternoon I
visited, two of the 40-odd attractions were on the fritz, and
12 had been rotated out make
way for new content. Marketing Director Jessica Gray said
the center’s tech team sometimes has trouble keeping up
with the bugs. But customers
understand the technology is
new and tend to be forgiving.
PETER J. SMITH FOR THE WALL STREET JOURNAL
BY ANNE KADET
Drivers in actual car seats fitted with steering wheels and break pedals competed in a race-car game at VR World NYC in Manhattan.
Sandy Friedman, a Midtown
East resident on hand with
three grandchildren, said the
kids were having a blast.
“They tried shooting each
other, they tried the car racing, they tried walking the
plank, which scared them,” she
said. “They loved it though.”
VR World says 85% of its patrons are between the ages of 24
and 51, and there’s some oddly
adult games. My favorite was an
attraction called “Job Simulator” where you could choose to
work as a retail clerk, auto mechanic or fast-food service
drone. I chose “office worker.”
The game puts you in a
’90s-style cubicle where you’re
supposed to complete office
tasks issued by your robot
overlords. Instead, just for fun,
I went berserko, throwing coffee mugs across the office and
scattering books across the
floor. Then I opened the box of
doughnuts and put a cruller in
the copy machine. To my surprise and delight, it produced
another doughnut.
An attendant issued a mock
scolding. “You’re making a
mess!” he said. “You’re in big
trouble with the boss!”
I was more impressed with
the center’s friendly, funny human guides than the technology. When I froze while walking the plank over a virtual
city 48 stories up, for example, a guide offered her hand
and walked me back.
Most of the guides have a
GREATER NEW YORK WATCH
Man Tried to Join
Militants: Officials
A New York City man faced
terrorism charges Tuesday accusing him of trying to support
Islamic State group by traveling
to the Middle East to fight with
militants.
A country bordering Syria detained Parveg Ahmed before he
could carry out plans to enter
territory controlled by Islamic
Statelamic State, according to a
criminal complaint that didn’t
name the country.
The 22-year-old Queens resident was returned on Monday
night to New York, where he
was expected to appear later
Tuesday in federal court in
Brooklyn. There was no immediate information on a lawyer who
could comment on his behalf.
“As alleged, Ahmed sought to
take up arms with violent terrorists who have killed numerous
innocent victims, including Amer-
icans,” Acting U.S. Attorney
Bridget Rohde said.
According to the complaint,
Mr. Ahmed first began posting
pro-Islamic State messages on
social media in 2014 and 2015.
One read, “The side of Good is
Islam & the Caliphate. If you’re
not with the Muslims, you’re ignorantly, irrelevantly, & arrogantly on the side of Evil,” the
complaint said.
If convicted, he faces a maximum 20 years in prison.
—Associated Press
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NEW JERSEY
Governor Criticizes
Testimony as False
New Jersey Gov. Chris Christie says a former NJ Transit
compliance officer gave “false
and retaliatory testimony” to the
Legislature last week.
Todd Barretta told a joint Assembly and Senate oversight
committee Friday he believed
there were multiple safety issues with the transportation
agency—so much so that he
wouldn’t let his child ride it.
The Republican governor
slammed the testimony as an
attempt to manufacture a scandal.
Mr. Barretta was hired as
chief compliance officer in April
and was fired in August. NJ
Transit said he “brazenly” violated its vehicle policy.
Mr. Barretta didn’t respond
Tuesday to a request for comment.
—Associated Press
CLAUDIO PAPAPIETRO FOR THE WALL STREET JOURNAL
NEW YORK CITY
Mott Haven Academy Principal Jessica Nauiokas with students
MOTT
Continued from page A8A
improve its low test scores to
remain open. The staff overhauled the curriculum, cracked
down on absenteeism and intensified tutoring, said the
principal, Ms. Nauiokas.
Students have a longer
school day than district
schools and usually two certified teachers are assigned to
each class of about 26.
Four “behavior specialists”
are on hand to soothe students who act out so they can
return to class quickly. Each
classroom has a “take-a-break”
spot for children who need
space to calm down. Point systems allow students to earn
rewards for good behavior.
“We try to make it so discipline issues don’t derail the
academic work,” Ms. Nauiokas
said.
Some students present real
challenges.
At kindergarten orientation
this week, a boy in foster care
sat quietly with his hands on
his lap, listening to a story,
but his good manners hid a
temper. In an incident last
spring, he was caught on video
in a restaurant, hitting his foster mother, cursing and throwing gang signs.
In another kindergarten
room on Monday, a foster
child named Elias balked at
joining his new classmates in a
painting project. His teachers
let him play with plastic
blocks instead, and gave him a
2-minute hourglass of sand so
he could track his time away
from the group and rejoin
when he was ready. Teachers
said such techniques aim to
give a sense of control to the
students who often lead lives
full of uncertainty.
By the charter school’s
analysis, its foster children
fare much better than those in
district schools. In fifth grade,
for example, 58% of the charter’s students in the child-welfare system passed the state
math test in 2016, compared
with 8% of New York Foundling’s foster children who attended regular public schools.
After years of climbing upward, the charter’s state test
scores slipped slightly last
spring, to 37% proficient in
English and 59% in math. The
principal said faculty believed
that dip to be isolated and
have modified curricula and
instruction to address it.
Bill Baccaglini, president of
the New York Foundling, said
that in many regular public
schools, busy teachers often
“teach to the middle” of the
ability range.
“My kids, because of all the
things that have happened to
them, don’t exist in the middle
of the room, they exist on the
margins,” he said. “Where you
have populations like this it’s
foolhardy to think the straight
academic program focused on
the 3 R’s will get them from A
to Z.”
background in occupations such
as theater or social work and
are trained in both technology
and the art of helping nervous
newcomers, Ms. Gray explains.
Indeed, VR World aims to
be more than a futuristic version of a gaming arcade such
as Dave & Buster’s. It’s planning lectures and panels for
the VR community, art installations and a VR history exhibit.
It’s not a first in New York
City. Several pop-up VR installations have appeared around
town in recent years. But there
is a good business case for a
permanent installation like VR
World, says futurist Amy Webb,
who teaches strategic foresight
at the New York University’s
Stern School of Business.
Video arcades boomed in
the 1980s because few had the
resources to enjoy a decent
Pac-Man experience in their
living room. We’re at that
point now with virtual reality,
Ms. Webb says. “People are
curious about VR and don’t
have the technology at home.”
If the VR World concept
bears out, its founders plan to
launch as many as 30 locations
nationally during the next few
years. For now, they’re winging it and experimenting.
Ms. Friedman probably has
the right idea. When I asked
her what VR World might look
like in the future, she said:
“Crowded!”
anne.kadet@wsj.com
Two Are
Arrested
On Drug
Charges
BY CORINNE RAMEY
A New York man and New
Jersey woman were arrested Tuesday on accusations
they distributed designer
drugs manufactured in a luxury high rise in Queens’ Long
Island City neighborhood.
Federal prosecutors said
the pair sold drugs, including
a synthetic opioid, online and
shipped them through the
mail, a business model law-enforcement officials say has become increasingly widespread
and has helped fuel the opioid
crisis.
Federal prosecutors charged
Brian Parker, 34 years old, of
Long Island City, and Victoria
Koleski, 29, of Farmingdale,
N.J., with conspiring to distribute controlled-substance analogues and other crimes.
Lawyers for Mr. Parker and
Ms. Koleski didn’t return requests for comment.
Agents from the Drug Enforcement Administration and
New York State Police raided
the building Tuesday, officials
said. Video shows law-enforcement officials in hazmat suits
carrying boxes out of the
building.
The drugs distributed by
the pair were linked to the
May 2016 overdose death of a
37-year-old Wisconsin man,
prosecutors said. They said
the man had ordered drugs including a synthetic opioid several times more powerful than
morphine from a website operated by Mr. Parker.
Mr. Parker sold designer
drugs through two websites
and used co-conspirators in
New Jersey and other places
as part of his distribution network, according to a complaint. The co-conspirators received raw materials in the
mail from China, which they
repackaged and sent to Mr.
Parker, the complaint said. Mr.
Parker then turned the raw
materials into the drugs he
sold online, prosecutors said.
He then sent the drugs to
the co-conspirators, who
shipped them to customers,
the complaint said. Prosecutors said that from June 30
through July 5, Ms. Koleski
shipped 218 packages from a
Farmingdale, N.J., post office.
The complaint said Mr.
Parker used social-media websites, including Reddit, to discuss his business.
Reddit didn’t respond to a
request for comment. The
website’s rules say drug solicitation or linking to vendors
results in immediate banning.
Each charge carries a maximum of 20 years in prison and
a $1 million fine, prosecutors
said.
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | A9
LIFE&ARTS
WORK & FAMILY | By Sue Shellenbarger
When Is it OK to Play Hooky?
AS SCHOOLS REOPEN, some
parents are yielding to a timeless
temptation: Playing hooky.
Five-year-old Erica Reed and her
siblings Alex, 9, and Katelyn, 12,
missed school in Denver on Aug. 21.
Their father Scott took them on a
camping trip to Halsey, Neb., to see
the solar eclipse in totality. Katelyn
had told her teachers she’d be absent and Mr. Reed let Erica’s and
Alex’s teachers know, too. But he
didn’t ask permission.
Mr. Reed has loved astronomy
since seeing Neil Armstrong walk
on the Moon on his sixth birthday,
he says, adding, “I want my own
kids to have a similar kind of wonderment and hope” about future
discoveries.
Parents often dream of traveling
with their children to teach them
about science, geography and culture. Many teachers support them,
as the Reed children’s teachers did.
Other teachers bristle at the extra
work such absences impose on
them. Resistance from school officials is also mounting amid closer
tracking of student absences.
Kim Milnes took her sons, Colin,
11, and Cooper, 8, out of school for
five days in May to visit a Bigfork,
Mont., dude ranch, Flathead Lake
Lodge. She was happy to see the
boys set aside their phones and
iPads to ride horses and build
makeshift forts, says Ms. Milnes,
owner of Family Travel Boutique in
Cherry Hill, N.J. “They’re going to
have really special memories.”
Ms. Milnes notified her sons’
school and teachers a week in advance and had them complete
homework while away. Still, she received a letter from
the school after the
Many parents try to
trip, saying Colin, who
book travel far ahead
had missed some addito take advantage of
tional days because of
early discounts that
illness, needed to imare offered over a year
prove his attendance.
in advance. But waitA 2015 federal law,
ing for schools’ annual
the Every Student Succalendars can make
ceeds Act, requires
that difficult, says Anstates to report
gela Pierson, co-owner
chronic absenteeism—
of an Amelia Island,
usually defined as beFla., travel agency.
ing absent for any reaSome schools issue
son on 10% of school
calendars as far as
days or more, typically
three years in advance
about 18 days a year.
to ease planning, says
This marks a departure
Gail Pletnick, a SurNeal and Ginny Kistler had their children miss four days of school for a 2016 family trip to India, left.
from the past practice
prise, Ariz., superinNancy and Eric Bostrom took their daughter Kate out of school to watch the recent eclipse, right.
of tracking only trutendent and president
ancy, or unexcused abof AASA, a national
sences. Some states are also using
superintendents’ association.
Parents under age 37 plan to inplete or incorrect, because the abchronic absenteeism as a yardstick
Parents should check on schools’
crease travel spending by 19% in
sent student didn’t hear her explafor measuring school quality.
absence policies before planning
the 12 months ending in January
nation in class. Ms. Grundel,
British parents can be fined and
travel and notify officials and
2018, compared with no increase
English department chair at Ponaprosecuted for taking their children
for all U.S. travelers, according to a
teachers as early as possible. Some
ganset High School, a public
survey of 2,900 people by MMGY
out of school for holiday travel
officials are strict in penalizing abschool in North Scituate, R.I., says
Global, a Kansas City, Mo., travelwithout advance permission from
sences, but others consider them
some students suffer anxiety as
marketing agency.
their school’s head teacher.
case-by-case, says Daniel Kelley,
they struggle to catch up.
Confining family travel to
The focus on absences is rooted
president of the National AssociaSome parents switch to private
school breaks sharply increases
in research showing that students
tion of Secondary School Princischools, partly to gain flexibility,
the cost as popular peak-season
who are absent often, for any reapals. Mr. Kelley, principal at a pubbut meet resistance there, too. At
destinations jack up their prices.
son—excused or unexcused—perlic high school in Smithfield, R.I.,
Aspen Country Day School in AsNeal and Ginny Kistler of Laguna
form more poorly in school.
says he weighs requests based on
pen, Colo., the school’s parent
Niguel, Calif., try to confine trips
Teacher Amanda Grundel says
the student’s attendance record,
handbook “plays the guilt card—reoverseas with their children Conshe feels frustrated when parents
minding parents what they’re missthe purpose of the trip and the
rad, 13, and Sophia, 11, to school
take students out of school for fam- ing,” including group projects, class
kinds of classes involved.
breaks, but they often pay about
discussions and labs, says Carolyn
ily trips. If she sends homework,
Dr. Pletnick suggests asking
20% to 40% more, Mr. Kistler says.
Hines, a school spokesperson.
she finds it’s often returned incomwhether students could do activi-
MICHAEL WITTE
An educational vacation might give students something school can’t, but teachers don’t always support such trips
ties while traveling that would
meet specific learning goals a
teacher has set.
When Kate Bostrom’s school had
to cancel plans for students to view
the Aug. 21 eclipse because of problems with viewing glasses, her
mother Nancy took her daughter
out of class and met her husband
Eric near her Holly Springs, N.C. office so the family could watch the
eclipse together. “It was a once-ina-lifetime opportunity,” says Kate,
who is 10.
Valiena and Dan Allison of Troy,
Mich., give their children Garrick,
18, and Sky, 16, a say in planning
their family trips to Europe, the
Galapagos and elsewhere, as well as
responsibility for planning homework with teachers at their private
school. When Garrick asked to
postpone a planned trip to Antarctica three years ago because he
didn’t want to miss five days of
eighth grade, his parents complied.
Garrick agreed to miss five days
of school for the Antarctica trip
last year as a junior, however. Managing the homework was a challenge, but it helped him gain timemanagement skills. And the trips
are worth the effort, he says,
sparking his interest in international relations. “You can’t really
put a price on altering your world
view,” Garrick says. “That’s what
travel has done for me.”
PHOTO ILLUSTRATION BY THE WALL STREET JOURNAL; PHOTOS: GASOLINE GLAMOUR; KATE SPADE NEW YORK (3); CHASER BRAND; THREEPOTATOFOURCO; CUFFLINKS, INC; LETTERCLOTHINGCO; WILDFOX; UNCOMMONGOODS; ISTOCK (2)
FASHION
HOW TACOS BECAME A
FASHION TREND
BY ANNE MARIE CHAKER
A taco
pennant
from Etsy, a
$184 pair of
Gasoline Glamour
glasses, and a $98
Kate Spade scarf.
DON’T LOOK, but there’s a
taco on your T-shirt.
Tacos have gone from
one of America’s most popular restaurant foods to a
serious fashion statement. A
$59 tank top from Los Angeles-based clothing brand
Chaser reads “tacos are my
life.” New York-based Nylon
Media’s online store sells tacothemed jewelry and sunglasses
while Kate Spade offers a $358
purse in the shape of a taco
truck. Online retailer Etsy says
taco searches were up more than
65% in the first half of this year.
Kevin Palarz, a 36-year old structural engineer in Barrington, Ill., has a
thing for tacos. He and his friend Mark
Lanctot track their taco consumption—
including restaurants and ratings—on
a shared spreadsheet. Mr. Palarz, who
has consumed, 881 tacos since Janu-
ary, owns several taco-themed T-shirts
and socks. “When I wear my taco Tshirt, people on the street talk to me,”
he says. “It’s a social thing.”
The public taco obsession has been
stoked in recent years by teens and
20-somethings, experts say, who are
exposed to celebrity-magazine images
of a chilled-out, West Coast lifestyle.
“There is something fundamentally
California about tacos,” says Megan
Baca, vice president of design for
Chaser, whose beachy T-shirts and
dresses are sold in department stores
such as Bloomingdale’s and Nordstrom. Celebrities such as singer Katy
Perry and model Chrissy Teigen have
recently been photographed waiting
in line for tacos or eating them. Tacos got a major break in 2015: After
much lobbying by Taco Bell and others, the nonprofit Unicode Consortium, which regulates coding standards for written computer text,
approved the taco as an emoji. Graphics of tacos began trickling in after
Please see TACOS page A11
THE WALL STREET JOURNAL.
A10 | Wednesday, August 30, 2017
LIFE & ARTS
Vinnie Pacifico of Massapequa, N.Y., 62,
owner of wholesale meat and trucking businesses in New York City, on his 1963 Chevrolet Corvette Sting Ray, as told to A.J. Baime.
When I was 9, I had a neighbor who
owned a red 1963 Corvette Sting Ray. I
would watch him wash that car. I would
watch him drive it down the block. Once he
gave me a ride and I was hooked.
In the 1980s, I was visiting my partner’s
friend’s place in Colorado, and he had a 1963
Corvette Sting Ray rusting in his barn. Mice
were living in it. I said, “What are you,
crazy? Why don’t you fix this up?” Two
years later, the owner decided to sell. He
was asking $12,000—a lot of money for a
beat-up car back then. I said, “Sold.” I put it
on a flatbed and had it delivered. It took me
12 years to restore the car. I had it painted
red, just like the 1963 Corvette I remembered as a kid.
I am in the meat business, but I have also
spent years in the art world. I owned a
Manhattan art gallery, and I currently have
a large collection of graffiti. To me, the 1963
Corvette Sting Ray is a real example of the
American art form. [Chevrolet still makes
Stingrays today, but now spells them with
one word.]
The 1963 model was special for many reasons. It was the first year of the second-generation Corvette, the one
that really made this vehicle
America’s sports car. It was
also the only year of the socalled “split window.” A
metal bone runs down the
back, splitting the rear window into two sections. It
truly looks like the spine of
a sting ray, and because the
1963 model is the only year
of the split window, it is
considered today perhaps the
most desirable production Corvette ever.
The car is also a blast to drive. I
put disc brakes on it and I upgraded
the engine for more power, but other than
that, it is pretty original. It’s just a feelgood piece of machinery.
When I am not driving it, I park it in my
driveway, grab a chair and an iced tea, and
just look at it. Some art you can hang on
your walls, and some you park in your
driveway. All Corvettes from the 1960s are
beautiful, but the 1963 Sting Ray is the Picasso.
MY RIDE | By A.J. Baime
ADRIENNE GRUNWALD FOR THE WALL STREET JOURNAL
The Most Coveted
Classic Corvette
Vinnie Pacifico sits in his 1963 Chevrolet Corvette Sting Ray near his home in Massapequa, N.Y. Its rare split window,
bottom right, is part of what makes it the most desired Corvette for many fans of the car.
Contact A.J. Baime at
Facebook.com/ajbaime.
ADVERTISEMENT
Showroom
To advertise: 800-366-3975 or WSJ.com/classifieds
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THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | A11
LIFE & ARTS
ART REVIEW
‘Truth-to-Materials’ Sculpture
Tom Joyce’s monumental works are a love letter to abstract shape, paying homage to forebears dating back to Brancusi
BY ANN LANDI
TACOS
Clockwise from above: Installation view of ‘Everything at
Hand’ at the Center for Contemporary Arts with ‘Bloom
V’ (2016) in the foreground; Mr. Joyce’s ‘Berg XV’ (2013);
Mr. Joyce at work on a charred drawing in 2016
CLOCKWISE FROM TOP: DANIEL BARSOTTI/CCA; DANIEL BARSOTTI/TIA COLLECTION; ANNE-MARIE BOUTTIAUX
Santa Fe, N.M.
THESE ARE strange times for
monumental sculpture, whether
outdoors or indoors, sited in public
spaces or ensconced in the capacious lobbies of high-rise buildings.
Yet for ambitious artists, big works
in durable materials can prove irresistible. And while contemporary
art may not carry the controversial
charge of Confederate statues, it’s
still a cultural landscape dotted
with extremes: Jeff Koons’s giant
balloon dogs and Damien Hirst’s
flayed vision of the Virgin Mary on
the one hand, and on the other,
works by younger artists like Carol
Bove and Roxy Paine, who riff on a
Modernist tradition that the uninitiated may find hard to understand.
But another strain of sculpture
is still adventurously at work, and
this one stems from the venerable
“truth-to-materials” aesthetic and
love of abstract shape that runs
from Constantin Brancusi through
David Smith right up to Richard
Serra. Tom Joyce—who is the subject of a mini-survey here at the
Center for Contemporary Arts
called “Everything at Hand,” comprising 45 works made in the past
12 years—falls squarely into this
tradition, with noble monuments
weighing up to 21 tons made from
cast iron and forged steel.
The show, however, runs into
trouble almost from the start. Outside the main gallery doors are giant clusters of stainless-steel
spikes, like frozen sparklers, with
cast-iron modeled hammerheads
providing a central core. Those inner elements are a reference to
Mr. Joyce’s history as a blacksmith, a trade he learned almost
50 years ago as a teenager in El
Rito, N.M., and an important leitmotif that runs throughout a distinguished career that includes a
MacArthur award. The spikes are
made from steel filings retrieved
from earlier projects, and recycling
is another concern of the artist’s,
whether his sources are weapon
parts or the soil from battlefields
around the world. A little wall text
might have lent more resonance to
visually pleasing sculptures that
otherwise haven’t much new to
say.
A couple of silent videos near
the reception desk show the artist
at work in the studio and the
foundry, where clumps of red-hot
metal emit showers of sparks as a
layer of steel is sheared off. Not
much explanation needed here, but
“Core Value” (2015), a high-definition video projected on an interior
wall is truly baffling. In conversation with the sculptor later, I
learned that this was an animation
of a CT scan of the compact sculpture “Core IX” (2013/2015) near
the entrance. Those test results
also provided the schematic geometries for a series of three sevencolor lithographs. This is a kind of
high-tech recycling that could be
tied together better through wall
text.
Another gallery presents ghostly
3-D printed tools used by the artist, primitive shapes that look like
they’re made from quartz, suspended from the ceiling (they are
“stereolithography printed clear
polycarbonate-like plastic [with]
LED lights,” according to the exhibition checklist). In the same gallery is a series called “Well”
(2017), described as “dye sublimation photographs on aluminum.”
They are painterly, with a nubbly
texture that’s illusory because the
prints are flat and affixed to aluminum boxes. Though they might
look like crusty canvases cooked
up by, say, Larry Poons 40 years
ago, these are in reality photos of
the ends of the massive ingots that
provide Mr. Joyce with his raw
material. Again, some explanation
would be helpful.
This reviewer felt on firmer
ground in the largest interior gallery, where big steel sculptures
give full rein to Mr. Joyce’s dexterity with shape and surface, talents
that tie him to the grand Brancusito-Serra tradition. “Bloom IV” and
“Bloom V” (both 2016) have a
quirky organic life, blocky shapes
rounded at the top and clustered
together, rising from a bed of pebbles and suggesting Brancusi’s
“The Kiss.” “Lignifact I” (2017),
tucked in a corner, has a pillowy
aspect one never would have
thought possible from forged steel.
And the same is true of several of
the outdoor sculptures, like “Stack
VI” and the “Surge” series
(2015-17), five discrete plump
sculptures, whose gentle folds
have an almost erotic charge. In
the same gallery, a couple of huge
charred drawings, made up of exuberant circular shapes burned into
wood fiber through “pyroengraving,” are impressive in size but
oddly inert, like giant doodles with
a protractor and compass.
And what to make of the last interior gallery, an installation called
“Tenet” (2017), which is literally
the sculptor’s studio turned upside
down? A desk (with gloves, a notebook and other implements of the
artist’s trade attached), bookcases
and tools are all affixed to the ceiling. Mr. Joyce told me it was a
kind of farewell, a notion I had
trouble grasping. To the average
visitor, the dimly lighted installation will seem spooky, threatening
and surreal.
Mr. Joyce is an artist of huge
gifts with perhaps too many ideas
percolating at once. I’m generally
not one to complain about the absence of lengthy labels (and I’m
told a catalog will be available
soon), but visitors to this show will
need more hand holding to grasp
the most promising direction suggested by this survey: the interface
between technology (CT scans, 3-D
computer imaging, video, high-tech
photography) and traditional largescale abstract sculpture.
There is much here to delight,
and many works that puzzle. A
better edited exhibition, one that
connected the disparate strains of
the artist’s fertile imagination
through text and placement, would
leave visitors with more of a sense
of “Aha” and less of “Huh?”
Tom Joyce: Everything at Hand
Center for Contemporary Arts,
through Dec. 31
Ms. Landi writes on the arts and
culture from Taos, N.M.
The WSJ Daily Crossword | Edited by Mike Shenk
taurant cuisines, such as Korean, Chinese
and Middle Eastern fare.
Part of the fun is that some taco designs
make people laugh and some leave others
scratching their heads. Ms. Evans authors an
annual report titled Slanguage which deconstructs popular new catch phrases and symbols for marketers. The report explains that
teens and 20-somethings have created their
own vernacular, “with an injection of humor
and irony that transcends parents and anyone over the age of, say, 35.” Tacos, which
have attained street credibility among 20somethings, she says, are part of that. “The
microtrend of food,” Ms. Owens says—de-
CAPELLI NEW YORK
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LIVING ON THE EDGE |
By Herre Schouwerwou
Across
1 Crude abode
7 Sorting through
data
13 Brunch
beverage
14 Holiday
centerpiece
15 Impediment to
romance,
perhaps
16 Broncobuster
17 One that
inspires?
18 Uncomplaining
20 Audition rejects
21 Winona’s role in
“Beetlejuice”
23 Set out
25 Bit of code?
26 Eminent
28 Lord of the rings?
30 “Bull” carrier
33 City known for
its beef
34 Hardly swanky
37 Presidential
promise
39 Heading up?
41 Words to a
betrayer
42 Evil spell
44 Work group
46 Shucking unit
47 Syrupy
sentiment
48 Microscope part
50 Future fish
52 Plea from eager
beavers
55 West Coast
NFLer
59 2017 Baseball
Hall of Fame
inductee
Rodriguez
61 Zealanders, e.g.
63 Shell, apple or
target, e.g.
64 Bookie busters
66 Cloud addition?
68 Lures into bad
behavior
69 Self-conscious
question
70 Strategy in a
difficult situation
71 Holiday
trimmings
Down
1 Drink order
2 Casual greeting
3 Add to, as a bill
Solve this puzzle online and discuss it at WSJ.com/Puzzles.
s
Continued from page A9
that, says Sarah Owen, senior editor of digital media and marketing at fashion forecasting firm WGSN. Everything from rugs,
towels and baby booties followed, as well as
shirts that say “It’s Taco Time” or “There is
no We in Tacos.”
Clothing with graphic symbols and statements are like wearable tweets, says Ms.
Baca at Chaser, whose designs carry statements such as “My dog is my spirit animal”
or “Coffee is my secret lover.”
“It’s little soundbites of ourselves,” she
says. “I’m trying to capture the emotion
of a mini-mental vacation in a T-shirt.”
Ms. Baca designed her first taco
shirt two years ago after department store buyers balked at designs touting champagne and
beer. “It was, ‘How do you capture the fun. . .without alcohol?’
” Ms. Baca says. Chaser featured eight taco-influenced designs so far this year, compared
with only three last year, says
spokeswoman Gihan Salem.
More broadly, food seems to be
having a fashion moment. While
many trends start on the runway
and trickle down to the masses, the
A glittery $20 taco purse
food-symbol trend is going the refrom Capelli of New York
verse, says Mark-Evan Blackman, assigns containing symbols and expressions of
sistant professor in the fashion design delove for certain foods—“is a backlash to this
partment at the Fashion Institute of
huge wellness and clean-eating movement.
Technology. Now, high-end Italian brands
Now, it’s that girl who says ‘I’m going to
such as Milan-based Etro are incorporating
treat myself to a doughnut and talk about
foods such as spaghetti into designs, he
how much I love tacos,’” she says.
says. A skirt shown at the Bangkok InternaNoelle Burke, founder of Xenotees, a Philtional Fabric Fair involved a sushi design.
adelphia-based brand of T-shirts and pillowTacos, Mr. Blackman says, remain firmly
cases sold on Etsy and elsewhere, says sales
planted in U.S. fashion. “They are cool and
of her taco T-shirt design, launched last
they are sexy.”
year, are now double those of her pizza
Tacos are among the top five foods orshirts. “Pizzas are played out now,” says
dered at U.S. restaurants, according to NPD
Andi Ballard Sharp, creative director for
Group, which says that taco servings were
Wildfox, a Los Angeles-based maker of Tup 2% for the year ending in June 2017.
shirts, casual dresses and swimsuits.
Their influence has crossed into other res-
1
4 Bean
5 Scanners at JFK
6 Squeaks from
Pekes
7 Islam’s holiest
city
8 Coverage by the
press
9 Shipwright of
old
10 Pasteurize, in
a way
11 Watts of “The
Impossible”
12 He might make
himself clear
14 Naturalist
nicknamed
“John of the
Mountains”
16 Mexicali and
Calexico, and a
hint to this
puzzle’s
perimeter
answers
19 Gym routine
popular in the
1990s
22 Just fine
24 “Fargo”
affirmative
27 Broadway
statuette
29 “To Kill a
Mockingbird”
author
30 Mama moose
31 Ebenezer’s
utterance
32 Theatrical pieces
34 Shoot the
breeze
35 Sch. support
group
36 Plural possessive
38 Care provider,
briefly
40 Prairie dwelling
43 Soft shoe,
casually
45 “Cool” amount
of cash
49 Check for
messages,
perhaps
50 Mississippi or
Missouri
51 Like a lamb
53 Take in, take on
or take up
54 Daytime
refreshers
56 They may
reveal one’s true
colors
57 Athlete’s optimal
effort
58 Be a real poser?
60 Successor of
Claudius
62 Trump, for one
65 Budget rental
67 Next-to-last
letter
Previous Puzzle’s Solution
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THE WALL STREET JOURNAL.
A12 | Wednesday, August 30, 2017
SPORTS
MLB
The AL Puts the ‘Wild’ in ‘Wild Card’
A guide to the closest playoff race ever, where nearly three-quarters of the American League have a shot at the postseason
BY JARED DIAMOND
CARLOS OSORIO/ASSOCIATED PRESS
WHEN Major League Baseball added a second
wild card in 2012, the league wanted to give
more fans an opportunity to see playoff-caliber
action down the stretch.
Mission accomplished—sort of.
With a little more than a month left in
the season, six American League teams entered Tuesday within three games of the
Minnesota Twins for the final playoff berth.
By that measure, that makes 2017 the closest race in history, with nearly three-quarters of the league holding on to realistic October aspirations in the final days of August.
But “exciting” doesn’t equal “quality.” All
of these teams have massive flaws preventing them from taking charge.
Besides the New York Yankees, the AL
wild-card leader with a three-game cushion
over the Twins, the other contenders hover
around—or even below—the .500 mark. Excluding the strike-shortened campaign of
1995, no team in either league has claimed a
wild-card spot with fewer than 86 victories,
achieved by the 2015 Houston Astros. At
this pace, the Twins would win 83.
“It’s remarkable,” said catcher Mike Zunino, whose Seattle Mariners remain in the
hunt heading into Tuesday despite a 66-66
record. “It’s giving teams hope. You’re one
stretch away from separating yourself.”
Whether you call it “parity” or “mediocrity,” the rules dictate that somebody must
emerge from this slop. So with that, we
present a guide to a September that will put
the “wild” in wild card:
NEW YORK YANKEES (70-60)
Computer odds of making playoffs: 94.3% (Base-
Led by 23-year-old outfielder Byron Buxton, center, the Minnesota Twins have established themselves as wild-card favorites.
ball Prospectus), 86.1% (FanGraphs), 84%
(FiveThirtyEight)
Run differential: +131
Remaining opponents winning percentage: .507
Even with Aaron Judge mired in a monster second-half slump, the Yankees appear
safe. In fact, they still have their sights on
the division crown, entering Tuesday 3 1/2
games behind the first-place Boston Red Sox,
who are set to visit the Bronx this weekend.
Whether they catch the Red Sox or not, it
behooves the Yankees to stay in the first
wild-card spot. That would allow them host
the wild card game at Yankee Stadium, where
they have the second-best home record in
the AL.
could come in handy if they play the wild
card game on the road.
A month ago, with their record at 50-53,
the upstart Twins declared themselves sellers, dealing starter Jaime Garcia and AllStar closer Brandon Kintzler on consecutive
days before the trade deadline. Then a
funny thing happened: Led by 23-year-old
outfielder Byron Buxton, Minnesota won 17
of its first 27 games in August, suddenly establishing itself as wild-card favorites.
With only six games remaining against
opponents with a .500 record, the Twin
have the easiest schedule of all the contenders. They boast a 36-28 record away from
Target Field versus 31-35 at home, which
LOS ANGELES ANGELS (67-65, 1 game behind)
Odds: 17.4% (BP), 24.8% (FG), 27% (538)
Run differential: 0
Opp. W%: .504
SEATTLE MARINERS (66-66, 2 GB)
Odds: 10.2% (BP), 11.4% (FG) 10% (538)
Run differential: -24
Opp. W%: .517
The Angels looked all but dead after a 9-13
July, before a 16-10 showing in August thus
far brought them back to life. For casual fans
in search of a rooting interest, look no further: The Angels have Mike Trout, baseball’s
best player, who has appeared in just three
playoff games in seven seasons in Anaheim.
The better the Angels play, the more everyone can witness Trout’s greatness.
If Trout leads the Angels to the playoffs,
he could win his third AL MVP award -even though he missed six weeks a thumb
injury.
In an alternate timeline, one where fairness reigns, perhaps the Mariners cruise to
the playoffs. In this timeline, they must
fight to stay afloat because of a seemingly
unending string of injuries to key players.
They will head into September with 80% of
their projected opening-day rotation on the
disabled list. Seattle also has the toughest
remaining schedule of the teams in the race.
Despite all of that, the Mariners have an
opportunity to reach the playoffs for the
first time since 2001, the longest drought in
the majors. If they do play in the do-or-die
wild card game, look out: They have James
Paxton, the most dominant pitcher of any
wild-card contender when healthy. Nobody
wants to face him.
BALTIMORE ORIOLES (66-65, 1.5 GB)
Odds: 10.2% (BP), 11.2% (FG), 18% (538)
Run differential: -22
Opp. W%: .511
The Orioles vaulted themselves back into
the race by sweeping the Red Sox in Boston
last weekend, proving that one strong
stretch could make all the difference. They
have survived this long with one of the
worst pitching rotations in baseball, ranking
29th in starter ERA. Instead, Baltimore will
rely on its bats: Star third baseman Manny
Machado entered Tuesday with a .939 onbase-plus-slugging percentage in the second
TAMPA BAY RAYS (66-67, 2.5 GB)
Odds: 15.4% (BP), 16.9% (FG), 8% (538)
Run differential: +1
Opp. W%: .516
The Rays woke up on July 19 with a record
of 51-44, good enough for second place in the
AL East, ahead of the Yankees. Since they
have gone 15-23, hurting their chances of
reaching the playoffs for the first time since
2013. Even worse, they have 14 games left
Weather
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60s
80s
C l ar
Calgary
l
Helena
80s
Ottawa
Bismarckk
Billings
Boise
p s / . Paul
Mpls./St.
80s
70s
90s Reno
Salt La
Lake
Lake City
Cit
C
Che
h y
Cheyenne
Sacramento
100s
San Diego
90s
h
Omaha
Ph
Phoenix
Santa
anta Fe
Albuquerque
80s
90s
60s
A
h g
Anchorage
LLou
St.. Louis
Louisville
LLou
ill
Ft. Worth
Nashville
h ill
Memphis
Mem
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Charlotte
C
h l tt
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HARVEY
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b
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New
90s
l d
Orlando
Tampa
100+
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Atlanta
LLittlee Rockk 70s
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Birmingham
Dallas
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Jackson
Jackk
El P
Paso
80s
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Boston
50s
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Charleston
h
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Richmond
Oklahoma City
T c
Tucson
30s
40s
50s
40s
hington
hi
gton D.C.
DC
Washington
Springfield
Kansas
City
hit
Wichita
70s
Los A
Ange
l
Angeles
A ban
b
Albany
Augusta
A g
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Hartford
k
Milwaukee
Detroit
t
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Topeka
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p
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LLas
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30s
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Denver
70s
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Toronto
Warm
Rain
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T-storms
Stationary
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Flurries
90s
90s
Miami
70s
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
61 49 c
58 49 r
Atlanta
74 69 sh 80 71 t
Austin
87 68 pc 90 67 pc
Baltimore
78 64 pc 84 58 pc
Boise
93 64 pc 90 59 s
Boston
69 59 pc 81 54 c
Burlington
76 57 pc 69 48 sh
Charlotte
82 68 pc 79 67 t
Chicago
80 65 pc 73 57 pc
Cleveland
80 63 pc 74 54 pc
Dallas
86 71 pc 88 67 pc
Denver
92 61 pc 88 59 pc
Detroit
82 62 pc 72 50 pc
Honolulu
87 73 s
87 74 pc
Houston
79 72 r
87 71 pc
Indianapolis
82 65 pc 81 59 c
Kansas City
81 60 s
83 61 pc
Las Vegas
107 85 pc 103 83 c
Little Rock
81 70 r
75 69 r
Los Angeles
98 74 s
98 70 s
Miami
93 81 t
92 80 pc
Milwaukee
79 62 pc 70 57 pc
Minneapolis
80 59 pc 71 54 pc
Nashville
83 69 r
78 69 r
New Orleans
85 76 r
86 74 t
New York City
75 66 pc 83 56 pc
Oklahoma City
83 62 s
85 61 s
Today
Tomorrow
City
Hi Lo W Hi Lo W
Omaha
83 60 s
85 62 s
Orlando
93 76 pc 93 75 pc
Philadelphia
78 65 pc 85 57 pc
Phoenix
109 85 s 108 84 c
Pittsburgh
78 62 pc 76 52 c
Portland, Maine 71 52 pc 78 49 sh
Portland, Ore.
78 62 pc 82 58 s
Sacramento
96 59 s 103 69 s
St. Louis
84 66 pc 84 65 pc
Salt Lake City
93 68 t
92 66 pc
San Francisco
71 56 s
80 65 s
Santa Fe
83 54 t
85 55 pc
Seattle
73 60 pc 76 56 pc
Sioux Falls
82 58 pc 82 61 s
Wash., D.C.
79 67 pc 85 63 pc
International
City
Amsterdam
Athens
Baghdad
Bangkok
Beijing
Berlin
Brussels
Buenos Aires
Dubai
Dublin
Edinburgh
Hi
65
80
117
91
82
85
75
61
106
61
61
Today
Tomorrow
Lo W Hi Lo W
56 t
64 50 c
71 pc 84 69 s
83 s 119 83 s
79 t
93 79 t
62 s
80 64 pc
67 pc 80 55 t
56 t
65 50 c
46 s
64 56 s
84 s 104 86 s
47 pc 60 47 pc
44 pc 62 45 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
Tokyo
Toronto
Vancouver
Warsaw
Zurich
Hi
88
86
91
92
76
89
84
76
58
79
89
56
70
89
65
85
74
84
107
86
90
75
85
88
64
95
85
76
72
75
87
The Royals certainly have experience on
their side, having won consecutive pennants
and a World Series championship with this
core in 2015. But they have played terribly
of late. After Monday’s 12-0 loss to Tampa
Bay, the Royals had been outscored, 32-0, in
their last four games, failing score a run in
their last 43 innings.
First baseman Eric Hosmer, third baseman Mike Moustakas, outfielder Lorenzo
Cain and shortstop Alcides Escobar will all
hit free agency this winter, potentially
marking the end of an era in Kansas City.
Does this group have magic left?
TEXAS RANGERS (64-66, 3 GB)
Odds: 7.6% (BP), 5.6% (FG), 10% (538)
Run differential: +21
Opp. W%: .507
The Rangers don’t look like the best team
in the chase, but don’t ignore them: They entered Tuesday having scored 21 more runs
than they have allowed this season, the best
run differential of any team in the hunt besides the Yankees. That would indicate they
might have their best baseball still ahead of
them. Bet against Adrian Beltre at your peril.
CUTTING OUT THE CREAM PUFFS
20s
70s
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Sann Francisco
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10s
Winnipeg
ip
Seattle
70s
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60s
70s
70s
g
Eugene
50s
KANSAS CITY ROYALS (64-66, 3 GB)
Odds: 6.2% (BP), 12.5% (FG), 7% (538)
Run differential: -58
Opp. W%: .486
NCAA FOOTBALL
Shown are today’s noon positions of weather systems and precipitation. Temperature bands are highs for the day.
d
t
Edmonton
against the Red Sox, Yankees and first-place
Chicago Cubs, not to mention 10 more
against the Twins and Orioles.
Today
Tomorrow
Lo W Hi Lo W
65 t
71 54 c
63 pc 69 56 r
74 pc 91 73 pc
82 s
92 81 t
66 sh 77 66 pc
78 pc 91 76 pc
64 s
83 64 s
46 s
76 54 s
50 r
65 50 pc
61 t
79 57 pc
80 t
88 81 t
37 pc 58 39 s
58 c
71 59 c
69 pc 85 68 t
46 pc 71 50 s
77 sh 87 77 sh
54 t
68 53 pc
67 s
75 67 c
78 s 107 79 pc
65 s
85 67 s
78 pc 91 79 pc
64 pc 81 61 s
75 pc 85 76 c
79 t
87 79 t
47 s
62 47 s
82 t
95 82 pc
72 r
79 69 r
55 pc 66 44 s
59 pc 71 56 pc
56 s
81 61 s
63 pc 71 54 r
BY LAINE HIGGINS
SIXTY MINUTES in Norman, Okla., last
September helped to decide the fate of the
College Football Playoff in 2016.
That’s when Ohio State went on the road
to play fellow powerhouse Oklahoma rather
than pulverize an early season cream puff.
The Buckeyes’ 45-24 victory helped secure a
spot in the playoff for Urban Meyer’s team,
even after a nail-biter loss to Penn State
that cost them a spot in the Big Ten Championship game.
“If a program wants to be in the playoff
it’s going to have to give its players a chance
to show what they can do against the best
competition,” said Bill Hancock, executive director of the College Football Playoff.
The move to the College Football Playoff
in 2014 has forced teams with big ambitions
to wean themselves off the habit of scheduling patsies for pre-conference games.
According to proprietary rankings calculated by TeamRankings.com, the average nonconference strength of schedule for the team
that won the national championship jumped
from 10.1 in the Bowl Championship Era to 15.3
under the playoff format. The average nonconference strength of schedule for the top 10
teams is also up, from 8.7 in 2003-2013 to 10.7
since 2014. In determining the toughness of
schedules, TeamRankings.com considers a
team’s average margin of victory, which is
then adjusted to reflect preseason rankings.
According to David Hess, one of TeamRankings.com’s statisticians, that two point
increase in nonconference strength of
schedule is the rough equivalent of kicking a
40th ranked opponent off the schedule for
the No. 10 team. The national champion’s
five point jump? That’s like booting the
90th ranked team for No. 10.
What all of this means is that the games
in week one and two of the season are increasingly high stakes contests, not snooze-
ADAM LACY/CAL SPORT MEDIA/ZUMA PRESS
MINNESOTA TWINS (67-63)
Odds: 39.8% (BP), 31.4% (FG), 37% (538)
Run differential: -28
Opp. W%: .477
half, while shortstop Tim Beckham has hit
.395 in 26 games since arriving in a trade.
Ohio State defeated Oklahoma last September.
worthy blowouts. The opening Saturday of
2017 features two highly anticipated nonconference duels: Florida-Michigan and Florida State-Alabama. The following week
Clemson hosts Auburn and Oklahoma will
play at Ohio State. All of those schools are
ranked within the top 20 of the Associated
Press preseason poll.
The selection committee for the playoff
says it evenly values overall record, appearance in a conference championship, strength
of schedule and results against common opponents. Ohio State’s playoff berth last year,
however, proves that some factors may outweigh others.
“Arguably Ohio State would not have
been in the playoff if they hadn’t gone down
to Oklahoma and won that game and won it
convincingly,” Hancock said.
Other schools are taking note. Miami and
Alabama are negotiating to meet in their
2021 season opener, and UCLA and Wisconsin announced a home-and-home series beginning in 2029. Granted, it’s near impossible to predict a team’s relevance in the
playoff conversation so many years in the
future, but that is the nature of scheduling.
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | A13
OPINION
First Resilience, Then Boondoggle
An
arrow
straight up
in recent decades
has
been the rising severity
of hurricane
BUSINESS
damage. The
WORLD
culprit is the
By Holman W.
ever larger
Jenkins, Jr.
number of
people and
their stuff in the path of these
storms.
It has nothing to do with
climate change.
During the past decade that
we keep being told was the
hottest on record (the record
being skimpy), the U.S. also
saw a dearth of hurricane
landfalls. A major storm hadn’t
hit the U.S. since 2005.
Sandy, as many in the press
played down at the time, had
actually been downgraded to
a tropical storm when it
reached the New York and
New Jersey shore in 2012. The
impact was worse than it
might have been for a simple
reason: The storm followed an
unusual westward track, and a
garden-variety storm surge
happened to coincide with a
full-moon high tide.
Harvey has been an energetic storm but also an uncharacteristically stationary
one. The deluge that fell and
continues to fall on Houston
is created by a storm hovering in place, sucking up moisture from the Gulf of Mexico
and dumping it on land.
Even press accounts that
noted a lack of discernible
connection to climate change
somehow, by paragraph three,
were quoting climate-change
campaigners. This is a counsel
of despair. Daily tides rise and
fall along the East Coast anywhere from 2 feet to 11 feet.
Storm surges associated with
hurricanes range from 7 feet
to 23 feet. These dwarf the effect of any global-warmingcaused increase in the
steadily rising sea levels of
the past century.
Our economy consists of
millions of Americans who are
not waiting around for someone to tell them what to do.
This makes it resilient. Private boat owners in Houston
leapt into action to rescue the
stranded, many whose pleas
were transmitted via social
media, bouncing server to
server until they reached the
guy with a skiff down the
block.
Gasoline prices ticked up on
reports of damage to the
Gulf’s massive refining industry, encouraging some to forgo
filling up and leaving more
fuel available for those who
value it most. Foreign refiners
are eyeing the higher margins
available in the U.S. and dispatching cargoes our way.
Thousands in Houston have
been flooded out, and thousands more are without power
and likely to be so for days.
The outages Americans experience nowadays are not more
frequent, but tolerance for
them is lower, hence a growing number of householders
who outfit themselves with
emergency generators.
Even those Houston-area
residents who were free to
move around in their cars
found their way blocked by a
massive cattle drive down U.S.
90, as ranchers moved their
herds to higher ground. Disrupted drivers didn’t mind;
they stopped to take pictures,
according to the Houston
Chronicle, eyewitnesses to a
phenomenon seen only in
John Wayne movies. Another
expression of resilience.
Maybe we should
start budgeting for
the kind of bailout
Houston will need.
At the time of Sandy, New
York’s Mayor Mike Bloomberg
and Gov. Andrew Cuomo
blamed the damage, nonsensically, on global warming. They
had an eye on the administration in Washington. They
knew its hobbyhorses and
talking points. Their blather
was aimed at creating an atmosphere conducive to the
billions in federal rebuilding
grants that soon would be
flowing.
Two-thirds of Katrina’s
damage in New Orleans was
not covered by insurance.
Less than half of Houston
commercial buildings and
homes in the waterlogged
zone are covered by flood insurance.
It would not be politically
realistic to expect the Trump
administration to resist
opening the spigots as every
other administration has.
The background chant may
not be “climate change”—
perhaps the political sound
effects will dwell instead on
Houston’s role in protecting
America’s “energy independence.”
Only 10% of California residents have earthquake insurance; 85% of the public assets
in San Francisco are “self-insured”—i.e., uninsured. What
will be the accompanying music then? If Gov. Jerry Brown
is still in office, maybe he will
find some way to connect an
earthquake to global warming. Otherwise taxpayers in
the Midwest can expect to
hear how vital Silicon Valley
is to America’s global leadership.
If the U.S. were a private
business, such “contingent” liabilities would show up in
measures of the federal debt
and deficit. In Washington,
they do things differently.
One of the most interesting
quotes collected by Journal
reporters this week comes
from Michael Williams, a ballpark maintenance worker for
the Houston Astros, whose
position atop the American
League West will be a solace
to the hard-hit city. He noted
succinctly: “Houston floods
fast. They’re doing all this
construction but we still got
no [storm] outlets.”
Between the immediate
displays of self-help and resilience, and the predictable federal spendathon that’s coming, let Mr. Williams be heard
too. A few such lessons and
better planning might help
lighten the burden of those
facing future emergencies.
The Arpaio Pardon: Ugly but Constitutional
President
Trump’s decision last Friday to pardon
Joe
Arpaio
sparked
a
POLITICS p re d i c ta b l e
firestorm. As
& IDEAS
the partisan
By William
brickbats fly—
A. Galston
as they do after every highprofile pardon—it’s important
to stay focused on the troubling details that set this specific case apart.
By pardoning the former
sheriff after his criminal conviction for contempt of court,
Mr. Trump acted well within
his constitutional authority—
even though Mr. Arpaio had
not yet been sentenced. More
than 150 years ago, in what remains the leading decision on
this subject, the U.S. Supreme
Court in Ex parte Garland
(1867) stated that the president’s pardon power “extends
to every offense known to the
law, and may be exercised at
any time after its commission,
either before legal proceedings
are taken, or during their pendency, or after conviction and
judgment.”
Each time a president issues a controversial pardon,
the American people rediscover the odd power that
seems to cut against the spirit
of the rest of the Constitution. It is a broad, unreviewable power vested in a single
individual—entirely free of
checks or balances. And yet,
this apparent aberration was
an intentional addition by the
Constitution’s framers, who
debated and decisively rejected a role for the Senate in
granting pardons.
Alexander Hamilton devoted a substantial portion of
Federalist No. 74 to defending
the provision. “Humanity and
good policy,” he argued, “conspire to dictate that the benign
prerogative of pardoning
should be as little as possible
fettered.” And a single decision maker, he continued,
would be more likely to be
guided by the right kinds of
considerations as well as a
strong sense of responsibility
in exercising this power.
Hamilton did not see the
pardon as a challenge to the
rule of law, but the reverse—a
correction of law’s inherent
imperfection. “The criminal
code of every country partakes
so much of necessary severity,” he wrote “that without an
easy access to exceptions in favor of unfortunate guilt, justice would wear a countenance
too sanguinary and cruel.” The
pardon was created as a way
of tempering justice with
mercy. It is, wrote the great
Chief Justice John Marshall in
U.S. v. Wilson (1833), “an act
of grace.”
This raises the first point of
genuine controversy in the Joe
Arpaio case. President Trump
did not seek to justify his pardon as an act of mercy or
grace. Rather, he portrayed it
as reversing an injustice. At his
rally in Phoenix last week, he
posed a rhetorical question to a
supportive crowd: “So was
Sheriff Joe convicted for doing
his job?” And in a tweet shortly
after issuing the pardon, he
characterized Mr. Arpaio as an
“American patriot” who “kept
Arizona safe.” The president
disregarded the court’s finding
that the sheriff was doing his
job in an illegal manner and
that the law specifies not only
Can Trump explain
his decision? Or is
this just a sop—and
an abuse of power?
the ends of public policy but
also the permissible means. Mr.
Trump’s action tacitly endorses
the proposition that the ends
justify the means, which is a direct challenge to the rule of
law.
The best-known use of the
presidential pardon came in
1974, when President Gerald
Ford pardoned former President Richard Nixon. He justified his action in part by the
tradition Hamilton had cited.
“Surely we are not a revengeful people,” Ford said. Nixon
“already is condemned to suffer long and deeply in the
shame and disgrace brought
upon the office he held.”
But Ford’s principal argument was an appeal to the national interest. The country
confronted profound challenges at home and abroad, he
contended. Americans needed
to focus on these challenges,
and the divisive trial of a
fallen president would divert
them from rising to the occasion.
Ford made these arguments
in the statement with which he
began his historic and entirely
voluntary appearance before
the House Judiciary Committee. In the course of his remarks, he answered 10 questions the committee had posed
to him a month before his
hearing. Conducting himself
like any other witness, the
president followed his statement by answering dozens of
questions posed by committee
members, some of which were
decidedly hostile.
Ford’s testimony underscored the notion that although there is no legal basis
for overturning a presidential
pardon, the president is nonetheless publicly accountable
for his decision. Much as the
drafters of the Declaration of
Independence owed mankind a
justification of the act of separation, Ford felt a similar obligation to Congress and the
American people.
Does Mr. Trump feel any
such obligation? Is he willing
to answer questions—in writing and in person—about his
pardon of Joe Arpaio? If not, it
will be hard to resist the conclusion that he issued the pardon to send a message to his
core supporters and to free
those charged with enforcing
immigration laws from legal
restraints. If this isn’t an abuse
of power, what is?
Those Who Commute Deserve a Salute
By James Bruce
C
ramped almost to the
point of suffocation, surrounded by hard plastic
and metal, you glide through
the darkness, wondering
whether you will survive.
You’re not piloting a submarine or a spacecraft headed toward Mars. You’re just a New
York commuter trying to get
home, as the “Summer of Hell”
for public transit nears its end.
Or perhaps you’re leaving Los
Angeles on Tuesday to beat
the Friday traffic.
Nearly 40% of American
workers—more than 50 million
people—travel 30 minutes or
more to work, according to the
Census Bureau. It’s a grind: the
delayed trains, the stink of
sweaty dress shirts, the motionless traffic on the “freeways.” But the worst part is the
incessant reminder that you are
the world’s problem. Walking
doesn’t pollute. Cars and trains
do. Today’s cultural trends protest your lifestyle. Think about
it the next time you drink your
fair-trade coffee on a train built
before the Hogwarts Express.
Your trip is not recyclable.
As you face the day ahead—
and the straphanger next to
you, who really needs a
shower—you may begin to forget why you commute. Here’s
a fresh reminder:
Your daily grind
brings prosperity to
me—and the world.
• For your family. How you
used to love the city when you
were single and carefree! But
that cute neighbor became
your spouse, and then came
marriage and maybe children.
A kitchen the size of a waffle
iron felt hip when you were
eating out all the time, but
then you learned to cook.
• For the community. If you
drive from suburbia to an office
downtown, you’re leaving a
place where first comes love,
then comes marriage, then
comes a baby in a carriage. In
cities the baby often comes
first, sometimes with no marriage at all. That’s a crucial difference. Married fathers work
to make their neighborhoods
places where children can
flourish, and too many unmarried fathers don’t, as Charles
Murray explains in “Coming
Apart.”
• For the schools. If you can
afford a private education for
your little angels, then good for
you. But for many parents,
choosing a school means
changing districts. So get into
that car, dad. Take that train,
mom.
• For the opportunity. What
do New York, Washington and
San Francisco have in common, apart from terrible traffic? The answer is good whitecollar jobs and a chance for a
better life. Cities are America’s economic engines, and
they can take you to success
only if you hop on board.
• For America. According to
Mark J. Perry, in terms of economic output, New York state
rivals South Korea, but with 17
million fewer workers. California beats France, but with six
million fewer workers. This
kind of performance wouldn’t
be possible without millions of
American commuters. Your disagreeable journey helps support the productivity that delivers prosperity to the country,
indeed the world.
That includes the small
town in Arkansas where I live.
I walk to work, which isn’t
without hazards. One time I
was bitten by a duck overeager
(in my estimation) to protect
its nest. But, overall, it’s wonderful. Yet I know how much I
depend on you, the big-city
commuters: You set up my retirement account, approved my
mortgage application, and
routed my new shirt from a
distribution center to my doorstep. So thank you—and have a
safe trip home.
Mr. Bruce is an associate
professor of philosophy at
John Brown University in Siloam Springs, Ark.
BOOKSHELF | By D.G. Hart
Infallibility and
Its Discontents
The Pope and the Professor
By Thomas Albert Howard
(Oxford, 339 pages, $45)
I
n his 2015 remarks to a joint session of Congress, Pope
Francis was the picture of a modern pontiff. He noted
that “the contemporary world . . . demands that we
confront every form of polarization which would divide it.”
He cheered the future technological contributions of “America’s outstanding academic and research institutions.” He
saw it as his papal duty “to build bridges” and, departing the
Capitol, asked for the good wishes of those “who do not
believe or cannot pray.”
This was a far cry from his 19th-century predecessor Pius
IX, who in 1864 issued a “Syllabus of Errors” to correct some
of the alarming social and intellectual trends that had proliferated over the previous decades. Among the errors that “Pio
Nono” condemned were the notions that “every man is free
to embrace and profess that religion which, guided by the
light of reason, he shall consider true” and that “the Roman
Pontiff can, and ought to, reconcile himself, and come to
terms with progress, liberalism, and modern civilization.”
Those seeking to understand
this dramatic transformation of
the modern papacy would do
well to read Thomas Albert
Howard’s “The Pope and the
Professor.” Mr. Howard, a professor at Valparaiso University,
explains in captivating detail the
circumstances of the papacy’s
historical conservatism. He also
resurrects the plucky scholar who
sought to calibrate papal authority
for modern times, the German
theologian Ignaz von Döllinger (1799-1890).
The conflict between Döllinger’s critique of papal supremacy
and Pius IX’s defense makes for a riveting story that goes
well beyond church history and explores the key intellectual
and political developments of 19th-century Europe.
This debate, as Mr. Howard shows, emerged from the
historical cauldron of the French Revolution, Napoleon’s
march across Europe and the formation of new nation-states,
particularly Italy. In a relatively short span, the Catholic
pontiff went from being an influential member of Europe’s
political class and the prince of local Italian lands to seeing
his authority limited mainly to churchly, spiritual affairs.
Along the way, Roman Catholics saw church lands seized,
seminaries disbanded, priests guillotined, and popes kidnapped and held prisoner. Conservatives regarded these
events as proof that, without an authoritative church headed
by a pope with both spiritual and temporal powers, liberalism would usher in social chaos. This reaction fueled the rise
of ultramontanism, an outlook that understood the papacy as
the locus of stability for the church and society. The ultramontanists’ great hope was Pius IX.
Ironically, Pius began his reign in 1846 with sympathy for
liberal reforms in Italian society. But by 1848 he had
changed. When Italian revolutionaries invaded Rome, Pius
had to flee the city in disguise in order to save his authority
and his life. When he was finally able to return, he proceeded
to assert papal authority as a means for order in the church
and stability in politics.
As Pius IX asserted papal supremacy, Ignaz
von Döllinger’s opposition to the pontiff’s
authority made him an international celebrity.
The first major step in this strategy was Pius’s 1854
declaration of the immaculate conception of Mary—her birth
without the taint of original sin—as an official dogma of the
church. A decade later came his “Syllabus of Errors.” Pius
had long contemplated convening a council of bishops—the
first since the 16th century—in part to build support for
papal authority. That gathering finally occurred with the
First Vatican Council in 1869-70. That gathering ratified the
dogma of papal infallibility, the capstone of Pius’s expansion
of the papacy’s power.
Throughout Pius’s tenure, Ignaz von Döllinger remained
skeptical. From a scholarly family, Döllinger was an ordained
priest and teacher at the University of Munich. His work
prized historical investigation, and in his eyes papal authority was a historical claim that could be supported or undermined by research. His own study convinced him that the
Donation of Constantine, which established the papacy’s
political authority as head of the Papal States, had been
fabricated in order to prove Rome’s supremacy in the church
and society. Döllinger also wanted to improve relations
between Roman Catholics and Protestants in Germany, where
Otto von Bismarck was, like Italian nationalists, seeking
unification. The papacy, Döllinger believed, was a barrier.
Döllinger’s opposition to papal authority made him an
international celebrity, especially among Protestants. In
Germany, France and England especially, the professor
ignited a vigorous debate about the papacy and its place in
European politics. Among his greatest supporters were
England’s prime minister, William Gladstone, and the English
historian John Emerich Edward Dalberg Acton (Lord Acton),
for whom the new doctrine of papal infallibility was proof of
his well-known maxim that “absolute power corrupts absolutely.” For the most part, the dispute between ultramontanism and Döllinger’s position remained indirect: Theologians
wrote journal articles, and bishops made appointments. But
when Pius IX secured the declaration of papal infallibility,
Döllinger refused to concede and was excommunicated, remaining under church condemnation until his death in 1890.
Pius IX’s own victory was mixed. The papacy lost its territories around 1870, with Italy’s unification. And as Mr.
Howard shows, Döllinger influenced a generation of
theologians like Henri de Lubac, Hans Urs von Balthasar and
Joseph Ratzinger (later Pope Benedict XVI), who, at the
Second Vatican Council in the early 1960s, prevailed in
reframing the papacy as a spiritual authority that was
capable, contra the “Syllabus of Errors,” of adapting to the
demands of modern politics, economics and law.
Today, Döllinger himself is a name that all but a few in
Roman Catholic circles have forgotten. But he was a forerunner of the contemporary church, and Pope Francis can be
seen as a vindication of his opposition to an anti-modern
papacy. Mr. Howard’s book does not pretend to be the complete story of how Roman Catholicism evolved from Pius IX
to Francis, but it does reveal—with impressive scholarship
and lively prose—the fascinating drama of how that transformation began.
Mr. Hart is the author of “Calvinism: A History.”
THE WALL STREET JOURNAL.
A14 | Wednesday, August 30, 2017
OPINION
H
REVIEW & OUTLOOK
LETTERS TO THE EDITOR
The Hurricane Learning Curve
The Problems With Bundled Health Billing
urricane Harvey is still pouring tor- Monday more than 12,000 Guardsman were asrential rain on Texas and Louisiana, sisting with search and rescue, and preparing
which means more damage to come. to help with recovery.
But it isn’t too soon to point
The state ramped up more
The lessons of failure
out some compensating news:
than 200 buses to transport
Storm responders are putting
people out of coastal areas,
in Katrina are saving
into practice the lessons of
and more than 40,000 shelter
lives in South Texas.
past extreme weather and
beds in safe zones. Houston
saving lives as a result.
Mayor Sylvester Turner gave
By late Tuesday the storm
clear instructions to resihad dropped 50 inches of rain on parts of dents to stock up and avoid roads, and he
Texas—breaking continental records. Harvey quickly deployed police and firefighters. Dallas
appears to have claimed at least 15 lives, in- opened a mega-shelter at its convention center
cluding a family of six swept away in a vehicle and put hundreds of buses on standby for
that remains missing. The Houston police by flood victims. Officials in smaller, coastal
Tuesday morning had rescued at least 3,400 towns worked with state authorities on manpeople from rising floodwater, and the Coast datory evacuations.
Guard rescued 3,000 on Monday. Officials are
One theme is communication and clear lines
predicting the storm will force 30,000 people of authority. Every analysis of Katrina has
into shelters and the economic damage will be pointed to confusion between Louisiana and
at least $30 billion.
Washington about who should be in charge. In
Yet as terrible as the toll is, it’s impossible this case, Governor Abbott and local officials
to ignore the improved response compared to appear to be taking the lead but are working
storms past. Hurricane Katrina in 2005 left New closely with the feds to marshal resources.
Orleans a chaotic scene of failed evacuation, These agencies are also using social media to
stranding 100,000 people in the low-lying city. provide instructions to victims, cut through ruIt killed 1,833, left three million without power mors, and work with Houstonians rushing to
and cost an estimated $100 billon to $130 bil- help neighbors.
lion. A few weeks later more than 100 people
Corporate America also learned from Kadied attempting to leave Houston, part of a pan- trina. Telecom companies have upgraded their
icked evacuation before Hurricane Rita.
networks against natural disasters after KaThe federal government, local officials and trina knocked out more than 1,000 cell sites
private and charitable interests are now apply- and put 911 calls and other networks in griding the lessons of these past failures. Katrina lock. As Harvey neared, AT&T and Verizon disexposed the Federal Emergency Management patched fuel for emergency generators and deAgency’s dysfunction, and Congress responded ployed mobile cell sites.
with reforms that altered how the agency
The Federal Communications Commission
works—particularly on pre-storm preparation. reported Sunday that just 4% of 7,804 cell sites
Prior to Katrina, FEMA waited until governors in Harvey’s path were knocked out. While Texrequested assistance, often arriving late as it ans are certainly getting busy signals, many
did in New Orleans.
emergency calls are getting through. By last
FEMA was on the ground in Texas nearly Friday Wal-Mart had already dispatched more
48 hours before Harvey made landfall, work- than 1,000 trucks of goods to Houston, and
ing with local partners and unifying a larger Bass Pro Shops is handing over 80 of its
federal effort. In addition to thousands of Tracker boats for rescues.
FEMA employees and the Coast Guard, the EnThe Texas stretch of the Gulf Coast is home
ergy Department was on hand to monitor oil to nearly five million barrels a day of oil and
and gas facilities, and Health and Human Ser- gas refining capacity. Post-Katrina, refineries
vices sent 650 staffers to provide medical as- hardened their facilities against the flooding
sistance. The Department of Homeland Secu- threat by investing in systems that guard elecrity on Saturday activated a post-Katrina tric equipment. They stacked up on emergency
program that stands up a “surge” force of non- generators and fortified against wind and storm
FEMA federal employees trained to assist in damage. So while refineries are closed as they
natural disasters.
ride out the storm, they should be back online
Former Louisiana Gov. Kathleen Blanco quickly when weather and roads clear.
dawdled about getting her National Guard on
The storm isn’t over, and no doubt some will
the streets to help with rescues and maintain find reasons to point fingers. But at a time
order. Texas Governor Greg Abbott quickly ac- when Americans have so little trust in governtivated the entire Texas National Guard, in- ment, it’s worth noting when it shows it can
cluding those preparing to deploy overseas. By learn from previous failures.
T
Nixing the $520,000 ‘Footlong’
he Seventh Circuit Court of Appeals has
given the plaintiffs bar something to chew
on. Writing for a three-member panel,
Judge Diane Sykes on Friday threw out a class-action lawsuit settlement involving the Subway
food chain’s “Footlong” sandwich on grounds that
the only beneficiaries were the lawyers.
The case started in 2013 after an Australian
teenager posted a photo on Facebook of a Subway Footlong sandwich next to a tape-measure
showing it to be 11 inches. The post went viral—
and so did the lawyers. Nine class-action suits
were launched around the U.S., later consolidated into one.
Subway soon announced steps to ensure its
baked rolls would be at least 12 inches. In 2016
a lower court approved a settlement under
which Subway promised to maintain practices
to ensure more uniformity in its bread. The suing
R
attorneys were to collect $520,000 in fees.
Enter Theodore Frank, who directs the Center
for Class Action Fairness at the Competitive Enterprise Institute. He objected to the settlement
on grounds that while the lawyers were “handsomely compensated” the class received “negligible to no relief.”
During litigation it emerged that though the
baked length of a roll may vary, the amount of
dough is uniform. Judge Sykes also noted that
“after the settlement—despite the new measuring tools, protocols, and inspections—there’s still
the same small chance that Subway will sell a
class member a sandwich that is slightly shorter
than advertised,” owing to the inherent vagaries
of food production. It’s safe to assume, wrote
Judge Sykes, that Subway customers “know this
as a matter of common sense.” These days we’ll
take any victory for common sense.
Nuclear Missiles Over Tokyo
esidents of northern Japan awoke Tues- if they conclude America isn’t reliable in a crisis.
day to sirens and cellphone warnings to Or Japanese may simply decide they can’t have
take cover as a North Korean rocket flew their survival depend on even a faithful ally’s
overhead. The intermediatejudgment. Some Japanese polAccepting a nuclear
range missile test will further
iticians are already talking
roil the politics of security in
about their own nuclear deterNorth
Korea
probably
Northeast Asia and is another
rent. And while public opinion
means a nuclear Japan. currently opposes nuclear
prod toward Japan acquiring
its own nuclear deterrent.
weapons, fear could change
Pyongyang tested longminds. Japan has enough plurange missiles over Japan in 1998 and 2009, tonium from its civilian nuclear reactors for
claiming they were satellite launches. The first more than 1,000 nuclear warheads, and it has
shocked Japanese and led to cooperation with the know-how to build them in months.
the U.S. on theater missile defense. Tuesday’s
This prospect should alarm China, which
launch is even more threatening because U.S. would suddenly face a nuclear-armed regional
and allied intelligence agencies assess that rival. The U.S. also has a strong interest in preNorth Korea now has the ability to hit Japan venting a nuclear Japan, not least because
with a miniaturized nuclear warhead mounted South Korea might soon follow. East Asia would
on a missile.
join the Middle East in a new era of nuclear proMuch of Japan is protected by its own mis- liferation, with grave risks to world order. This
sile defenses as well as systems operated by is one reason that acquiescing to a North Korea
U.S. forces in the region. Japan also recently de- with nuclear missiles is so dangerous.
ployed four Patriot PAC-3 missile-defense batYet this is the line now peddled by former
teries to the west of the country, but these Obama National Security Adviser Susan Rice
didn’t cover the northern island of Hokkaido and former Director of National Intelligence
overflown by Tuesday’s missile.
James Clapper, who says the U.S. must begin
Japan’s ultimate security is the U.S. defense “accepting it and trying to cap it or control it.”
and nuclear umbrella, with its treaty guarantee Having said for eight years that a nuclear North
that the U.S. will respond if Japan is attacked. is unacceptable, they now say that President
But the logic of deterrence depends on having Trump and Japanese Prime Minister Shinzo
a rational actor as an adversary, and rationality Abe had better get used to it.
can’t be guaranteed in North Korea. Its recent
But “control it” how? North Korea has made
development of an ICBM capable of hitting the clear it won’t negotiate away its nuclear proU.S. mainland also changes the equation. If gram. The U.S. can threaten mutual-assured deNorth Korea attacked Tokyo and the U.S. re- struction, but Tuesday’s missile test over Japan
sponded with an attack on Pyongyang, U.S. cit- shows how North Korea will use its nuclear
ies might then be endangered.
threat to coerce and divide the U.S. and its alJapanese leaders have long resisted building lies. Accepting a nuclear North Korea means actheir own nuclear arsenal, but that could change cepting a far more dangerous world.
Jason Furman and Bob Kocher
claim that because health care is so
complicated a single bundled fee based
on quality measures is the solution (“A
Health-Care Fix That Works, Now Being Rolled Back,” op-ed, Aug. 21). Their
approach is one size fits all that is designed to rein in cost and theoretically
improve care. This isn’t the solution.
You can perform the same operation in many ways at different costs
with similar outcomes because every
patient is unique; it’s why personalized cancer therapies are becoming so
effective. Believe it or not, doctors
spend years training and studying to
determine what works best and that
alone should dictate care. Money
spent has little to do with outcome.
Some of the best care has come from
front-line trauma surgeons in the
poorest neighborhoods.
Get rid of the incentives, pay only
for services rendered at a transparent
price and give the physicians the latitude to do their job without imposed
restrictions. I guarantee the cost will
be lower and the outcomes better.
PAULA MUTO, M.D., FACS
Lawrence, Mass.
I’ve been a practicing physician for
36 years. I ask Mr. Furman, an economist, how many patients has he
treated? How can he have any clue
what it’s like to care for people?
The answer to the health-care crisis
is simple: a direct-pay cash system and
health savings accounts with catastrophic coverage. HSAs put the purchasing power back with the patient.
When physicians are freed from the
third-party system and are paid directly by the patient, they will no longer need the staff for billing, coding,
electronic medical records, compliance,
reimbursements and audits. Their
overhead will plummet, resulting in
lower fees for the patients as they
compete for their cash business.
Currently, the patient who pays a
set fee for coverage wants his
money’s worth so will seek any test or
procedure that might be beneficial.
The doctor, looking to satisfy the patient and not get sued, will be happy
to order the scan or procedure even if
he thinks it isn’t worth it. Heaven forbid a doctor could miss something.
With a cash system, the physician will
be aligned with the patient’s interest
and decide with the patient what’s
the best and cost-effective way to
proceed. It’s been down hill since government and third-party intrusion.
More of the same isn’t the answer.
KEN CARTAXO, M.D., ABFM, ABIHM, CNS
Kinnelon, N.J.
In fee-for-service payments, there is
100% transparency. Administrators can
pay or not pay for “unnecessary” procedures and consultations. In bundled
and capitated-pay schemes, the patient
has no idea what corners were cut.
BRANT S. MITTLER, M.D., J.D.
San Antonio, Texas
The authors oppose fee-for-service
in health care, yet every other profession and economic activity runs on
fee-for-service—dentistry, the law,
auto repair, architecture, etc. Except
for the uninsured who pay cash, patients are essentially isolated from
health-care costs. Bundled payments
can definitely save money, as we
learned in the 1980s and ’90s with
health-maintenance organizations.
However, HMOs save money through
a gatekeeper system which often limited patient access to timely care.
The easiest way to show “improved
quality” is to not take care of the sickest patients, denying access to those
who need care the most.
ROGER STARK, M.D.
Redmond, Wash.
Bundled-payment methodologies
should work for a knee replacement
with rigidly defined start and endpoints of service and the measurable
outcomes of reduction of pain and improvement in function.
The problem with the Comprehensive Care for Joint Replacement Model
program is that it is a one-size-fits-all,
top-down government mandate. It calls
on about 800 hospitals to initiate the
program through which the hospital
will receive one payment for all hospital care, medicines, devices, medical
services and all postoperative care for
90 days. There was no place in the rule
from the Centers for Medicare & Medicaid Services that allowed for physician input into the program. None.
Bundled payment is thriving in the
private-practice setting when controlled by orthopedic surgeons contracting with health-insurance companies and self-insured unions and
corporations. As usual, the revolution
goes on in the private sector where all
true economic dynamism resides—
when and where it is allowed to occur.
The essential benefit of bundled payments is that they reintroduce price
into the medical marketplace. This is
the only mechanism that will contain
costs and maintain quality in a reasonable fashion as the incidence of this
type of knee procedure will likely increase 700% in the next two decades.
The alternatives are more mandates designed by the likes of Jason
Furman and Robert Kocher through
the single lens of decreasing what the
government pays. You can tell the authors have already lost the argument
when they contend that this reasonable rollback will lead to shorter lives
for Americans.
LOUIS F. MCINTYRE, M.D.
White Plains, N.Y.
ETFs Not Eating the Economy or the Market
“Streetwise: Let’s Prevent ETFs
From Eating the Economy” (Business &
Finance, Aug. 18) cites concerns that
the growing percentage of exchangetraded funds and index assets under
management could someday impair the
ability to find the right price for stocks.
Rather than focusing solely on the
amount of assets managed in ETFs and
index funds, a better way to understand their possible impact on market
pricing is to examine the percentage of
the stock market they own and the
turnover of stocks in these funds relative to others in the market.
Index funds hold only 15% of the
outstanding $34 trillion of market
capitalization in U.S. and European
stock markets. Active mutual funds,
on the other hand, hold roughly 21%
of the same market cap. More significantly, active fund managers dominate
the price setting for stocks, turning
over asset values of their portfolios 22
times those of ETF and index funds.
ETF volumes are dwarfed by the
stock-index-futures markets, which in-
Far Right and Left Equally
Authoritarian and Thuggish
Reading the recent stories and letters (Aug. 21) about President Trump’s
remarks concerning the riot in Charlottesville, Va., I couldn’t help but recall an argument I had while in college
in 1963. The subject was fascism/Nazism versus communism. My argument then and now is this: There’s no
difference between them. Both believe
in suppression of all dissent through
violence, thought control, no free expression or free press, no individual
rights and everything subject to the
control of the government. Pretending
that one or the other has some higher
moral standing is hypocrisy at its
worst. A pox on both their houses.
FREDERICK L. WASHBURN
Celina, Tenn.
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.
cludes the S&P E-Mini Futures contract. These futures contracts trade
$186 billion per day compared with
$125 billion per day in S&P stocks, and
only $20 billion in S&P 500 ETF
shares. No one ever worries that the
futures market is eating the economy.
Rather, it is seen as an indispensable
part of a vibrant capital market. ETFs
are similarly creating more vibrant
capital markets.
MARTIN SMALL
U.S. Head of iShares
BlackRock Inc.
New York
Limiting Prosecutors’ Abuse
Regarding your editorial “Texas Political Prosecution” (Aug. 21): One sure
way to trim the sails of over ambitious prosecutors is to require judges
to inform grand jurors—formally in
writing, as well as verbally when they
are empaneled—of their functions and
duties. They should be made aware
that they are not an arm of the prosecution, but of the court, and their
sworn duty is to protect the innocent
from unnecessary prosecution.
SAMUEL COLMAN
Boca Raton, Fla.
Pepper ...
And Salt
THE WALL STREET JOURNAL
“We’re taking you out, Steinmetz.
That homer you gave up
is going viral on Twitter.”
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | A15
OPINION
By Tevi Troy
P
resident Trump visited
Texas Tuesday to assess
the damage from Hurricane Harvey and show concern for its victims. So far,
his administration is largely getting
praise for effective handling of the
crisis. Washington’s disaster authorities appear to be in sync with the
state on roles and responsibilities;
the Federal Emergency Management
Agency and its leader, Brock Long,
deployed resources as Harvey approached; and the government response as a whole appears well coordinated.
The White House has
shown a focus on Harvey
that extends even to the
president’s Twitter feed.
“I give FEMA a grade of A-plus, all
the way from the president down,”
Texas Gov. Greg Abbott told “Fox
News Sunday.” Yes, Mr. Abbott is a
fellow Republican, but he is also interested in protecting Texas and
would not have said “A-plus” if the
state weren’t getting what it needed.
That assessment is backed up by Rear
Adm. W. Craig Vanderwagen, a former career emergency manager who
is plugged into the Harvey effort.
“Early read,” he told me in an email,
“is that Executive Branch is performing well under this President.”
Two reasons suggest themselves
for the apparent success: personnel
and preparation. Mr. Trump has surrounded himself with leaders experienced in this area. John Kelly, the
president’s chief of staff, is fresh off
his stint as the secretary of homeland
security. He brought to the White
House his own deputy, Kirstjen Nielsen, a veteran of George W. Bush’s
Homeland Security Council.
Tom Bossert, another Bush alumnus now advising Mr. Trump on
homeland security, has acquitted
himself well on television, projecting calm and expertise as he discusses the hurricane response. It
may be premature to conclude that
Mr. Kelly has succeeded in bringing
order to the Oval Office, but Harvey
has demonstrated a reassuring ability to focus on a disaster when
needed.
Beyond the White House, Mr.
Trump still lags behind his predecessors in filling political appointments,
but he appears to have prioritized
the right ones. The president has
made nominations for about half the
slots at the Department of Homeland
Security, more than at most departments. Some nominees, such as Mr.
Long’s two deputies at FEMA, await
Senate confirmation hearings. Mr.
Long is an experienced hand, having
previously served as Alabama’s head
of emergency management. He has
been a reassuring and take-charge
presence throughout the Harvey response.
Mr. Long began preparing for the
next disaster the day he was sworn in,
when he presided over a cabinet-wide
REUTERS
Trump’s Reassuring Hurricane Response
Texas Gov. Greg Abbott and President Trump in Corpus Christi, Texas, Aug. 29.
tabletop exercise on emergency management. Frank Cilluffo, a homeland
security aide in the Bush administration, says this showed the White
House was taking disaster readiness
seriously. “Training is everything
here,” he told me. “You want to make
mistakes on the practice field, not in
the actual event.” Then in early August, weeks before Harvey showed up
on the radar, Mr. Long hosted the
president and other cabinet officials
at FEMA for a briefing on the coming
hurricane season.
Thus far, the most controversial
part of the president’s hurricane response has been communications.
On the positive side of the ledger,
Mr. Trump has used his vast Twitter
following both to provide useful information and to convey that the
White House is actively monitoring
events. On Tuesday he retweeted an
urgent alert from Brazoria County
saying that a levee at Columbia
Lakes had been breached and residents needed to get out immediately.
Mr. Trump’s tweets about the
storm have been informative and responsible, with a tone appropriate to
the human tragedy. To the extent he
has been criticized, it has been mostly
for tweeting on unrelated topics, such
as his pardoning of former Sheriff Joe
Arpaio and the “great” new book by
Sheriff David Clarke. Although it isn’t
realistic to expect the White House to
eschew all other subjects during a crisis, perhaps the president could avoid
tweeting about unessential matters
until the storm passes.
Outside Twitter, the administration
has relied on experts like Messrs.
Long and Bossert to reassure the public, which seems an appropriate strategy. Message discipline matters.
When responding to a disaster, Mr.
Cilluffo says, you “can’t have one message here, another message there, and
a tweet saying a third thing.”
It’s reassuring that the White
House understands the importance of
relying on trusted messengers during
a crisis—especially given the backlash to Mr. Trump’s comments this
month after the violence in Charlottesville, Va. During an emergency,
the government needs wide cooperation from the public, which may not
be possible under any president with
credibility problems. Messrs. Long
and Bossert have the standing to appeal to Americans across the partisan
divide during Harvey and whatever
disaster may come next.
Mr. Trump’s handling of the hurricane response thus far is to be commended, but this is no time for complacency. The recovery in Texas will
take a long time, and new disasters
are always in the offing. The Trump
administration would serve Americans well by following its successful
approach to this first crisis with a
continuing focus on disaster management. Today it’s Harvey. Tomorrow, who knows?
Mr. Troy, a former deputy secretary of health and human services, is
author of “Shall We Wake the President? Two Centuries of Disaster
Management from the Oval Office”
(Lyons Press, 2016).
Modern Liberalism’s False Obsession With Civil War Monuments
Visit the American
Museum of Natural
History in New York
City, and between
exhibits of dinosaur
skeletons, Asian elephants and Alaskan
UPWARD
MOBILITY moose you might notice a bust of Henry
By Jason L.
Fairfield Osborn and
Riley
a plaque honoring
Madison Grant. Osborn and Grant were two of the country’s leading conservationists in the
early 1900s. They also were dedicated
white supremacists.
Osborn, a former president of the
museum, founded the Eugenics Education Society—now known as the Galton Institute—which sought the improvement of humanity through
selective breeding. Grant, a co-founder
of the Bronx Zoo, is known today for
his influential 1916 best seller, “The
Passing of the Great Race,” a pseudoscientific polemic arguing that nonwhite immigrants—which included
Eastern and Southern Europeans by
his definition—were tainting America’s superior Nordic stock. Osborn,
who was a zoologist by training, wrote
the introduction to Grant’s book,
which Hitler called “my Bible.” The
New Yorker magazine once described
Grant as someone who “extended a
passion for preserving bison and caribou into a mania for preserving the
‘Nordic race.’ ”
Given their options, why are liberals
so focused on monuments to Civil War
figures? Politically, it makes some tactical sense. The GOP has spent decades
warding off claims of racism, and forcing Republican politicians to defend
prominent displays of Confederate
statuary keeps them on the defensive.
On another level, however, liberals
make a fetish of Civil War monuments
because it feeds their hallowed slavery
narrative, which posits that racial inequality today is mainly a legacy of the
country’s slave past.
One problem with these assumptions about slavery’s effects on black
outcomes today is that they are undermined by what blacks were able to
accomplish in the first hundred years
after their emancipation, when white
racism was rampant and legal and
blacks had bigger concerns than Robert E. Lee’s likeness in a public park.
Today, slavery is still being blamed
for everything from black broken
families to high crime rates in black
neighborhoods to racial gaps in education, employment and income. Yet
outcomes in all of those areas improved markedly in the immediate aftermath of slavery and continued to
improve for decades.
Between 1890 and 1940, for example, black marriage rates in the U.S.
where higher than white marriage
rates. In the 1940s and ’50s, black labor-participation rates exceeded those
of whites; black incomes grew much
faster than white incomes; and the
black poverty rate fell by 40 percentage points. Between 1940 and 1970—
that is, during Jim Crow and prior to
the era of affirmative action—the
number of blacks in middle-class professions quadrupled. In other words,
racial gaps were narrowing. Steady
progress was being made. Blacks today hear plenty about what they can’t
achieve due to the legacy of slavery
and not enough about what they did
in fact achieve notwithstanding hundreds of years in bondage followed by
decades of legal segregation.
In the post-’60s era, these positive
trends would slow, stall, or in some
cases even reverse course. The homicide rate for black men fell by 18% in
the 1940s and by another 22% in the
1950s. But in the 1960s all of those
gains would vanish as the homicide
rate for black males rose by nearly
90%. Are today’s black violent-crime
rates a legacy of slavery and Jim
Crow or of something else? Unfortunately, that’s a question few people
on the left will even entertain.
Black accomplishments in
the ’40s and ’50s prove
that today’s setbacks are
not due to slavery.
Just ask Amy Wax and Lawrence
Alexander, law professors at the University of Pennsylvania and University of San Diego, respectively, who
were taken to task for co-authoring
an op-ed this month in the Philadelphia Inquirer that lamented the
breakdown of “bourgeois” cultural
values that prevailed in mid-20thcentury America. “That culture laid
out the script we all were supposed to
follow,” they wrote. “Get married before you have children and strive to
stay married for their sake. Get the
education you need for gainful employment, work hard, and avoid idleness. . . . Be respectful of authority.
Eschew substance abuse and crime.”
The professors noted that disadvantaged groups have been hit hardest by the disintegration of these
middle-class mores and that the expansion of the welfare state, which
reduced the financial need for twoparent families, hastened social retrogression. “A strong pro-marriage
norm might have blunted this effect,”
they wrote. “Instead, the number of
single parents grew astronomically,
producing children more prone to academic failure, addiction, idleness,
crime, and poverty.”
For the suggestion that something
other than continuing racial bigotry
and the legacy of slavery has contributed to racial inequality, a coalition of
faculty and students at the University
of Pennsylvania promptly accused the
professors of advancing a “racist and
white supremacist discourse.” The reality is that there was a time when
blacks and whites alike shared conventional attitudes toward marriage, parenting, school and work, and those attitudes abetted unprecedented social
and economic black advancement.
Misusing U.S. Sanctions Will Sap Their Power
By Jarrett Blanc
S
ince taking office President
Trump has not hesitated to
threaten or implement sanctions against countries like Venezuela and North Korea. Sanctions
are useful tools, but Mr. Trump and
bipartisan majorities in Congress
run the risk of making them less
effective.
The U.S. economy’s size is not
the primary reason its sanctions are
so powerful: Countries without a
significant trade relationship with
the U.S. can still be severely damaged by bilateral sanctions. Though
the European Union’s gross domestic product almost matches America’s, EU sanctions are much less
devastating. This influence derives
from America’s central position in
international finance—particularly
its control over the invisible plumbing that allows money to move
around the world.
Recognizing how much of their
work touches the U.S., major foreign
banks will often go so far as to treat
themselves as “U.S. persons” for legal
and regulatory purposes. Countries
or entities subject to U.S. sanctions
thus have a very difficult time with
even simple banking transactions,
which is catastrophic for trade.
Yet America’s dominant place in
international banking, like its position in the broader international
system, can be lost. The international financial plumbing can be
changed with the investment of time
and resources by banks, governments and regulators. So far there
have not been sufficient incentives
to make those changes, but governments and banks will reconsider if
the U.S. abuses its position.
Policy makers and regulators in
the U.S. have long been sensitive to
this risk. They have taken it into account in the application of new
sanctions and have worked closely
with foreign banks to ensure
they’re doing permissible business—even business barred to their
American competitors. For example,
outreach surrounding the Iran deal
was designed to assure foreign
businesses and regulators that remaining U.S. sanctions were tailored and not a back door to enforcing the sanctions lifted by the deal.
America’s central role in
finance gives it unique
clout, but this could erode
if Congress isn’t careful.
Thanks to these efforts, major foreign banks working with Iran have
largely chosen to work with U.S. officials and stay in careful compliance.
The U.S. government’s caution
seems to have been lost with the latest sanctions against Iran, Russia and
North Korea—legislation that passed
with overwhelming support from
both parties and was signed into law
by a hesitant Mr. Trump. The new
sanctions will do little to change the
kinds of commerce allowed with the
target countries. The law’s main
function is to shift influence over lifting sanctions from the White House
to Capitol Hill.
Congress has historically found it
more attractive to levy sanctions
than to lift them. Sanctions generally target adversaries, so that even
if a country changes the policy that
prompted sanctions, it likely will
have other problems with the U.S.
Some members of Congress will be
tempted to promote these remaining issues as new reason to keep
sanctions in place. That’s why the
1974 Jackson-Vanik restrictions on
most-favored-nation status for Russia stayed in place for a generation
after Russia opened up emigration
restrictions, the legislation’s original aim. Mr. Trump is right to say
the shift in power toward Congress
will make it harder to use sanctions
as a chit in international negotiations.
For those who are deeply concerned by Russian meddling in
other countries’ elections—and by
Mr. Trump’s apparent nonchalance—congressional authority over
sanctions may feel like progress. For
banks, governments and regulators
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Notable & Quotable: Waffles
Ethan Wolff-Mann, writing Aug.
25 at Yahoo Finance:
Hurricane preparation for many
can be a scramble, but for Waffle
House, it’s a game of chess with military-style strategy and execution. Before a storm hits, and even before
hurricane season, the company makes
storm checklists for each location,
meets with local authorities, and educates new employees, though many
have been through 15 hurricanes.
“We’ve already done all that,”
Waffle House’s director of external
affairs Pat Warner told Yahoo Finance. “Right now we’re getting
jump teams ready.”
A Waffle House jump team consists of a small team of restaurant
operators from outside the hurricane zone. These employees swoop
in at the first possible moment after a storm to restore service and
get things open. Typically after a
storm, demand for food is high and
functioning restaurants are in low
supply, and things get extremely
busy.
“There’s a jump team outside of
Nashville ready to go on Sunday.
Jump teams are [also] ready in Louisiana,” said Warner. “Then we can
deploy from the main office some
teams that may or may not go depending on severity.”
abroad, it looks as if the U.S. is
turning sanctions from means of
achieving particular ends into permanent stigmas. That makes it more
attractive to find ways to leave the
U.S. banking system.
Mr. Trump also is threatening
loudly to trash the Joint Comprehensive Plan of Action, better known
as the Iran deal. Never mind that
America’s international partners and
the intelligence community agree
that Iran is fulfilling its commitments. The U.S. built an international consensus that Iran’s nuclear
program was a problem. European
and Asian partners took appropriate
action, suffering real economic harm
by ratcheting back oil purchases and
other commerce with Iran and then
working to negotiate the deal. If the
U.S. cannot take “yes” for an answer, those same partners likely will
be at least as concerned about the
threat posed by America’s financial
power as the threat of Iran’s nuclear
program.
In a time when U.S. consistency
and reliability is openly questioned
by some of America’s closest allies,
threats of permanent sanctions will
draw more attention to the risks of
being dependent on the U.S. financial system. America’s importance as
an international financial hub will
not disappear overnight, and neither
will the reach of U.S. sanctions. If
the U.S. comes to be seen as an untrustworthy custodian, there will be
a slow and inexorable erosion of
America’s role and influence.
Sanctions compare favorably with
any other tool the U.S. has—and
certainly very favorably to military
action. Sanctions can help address
real problems in the world, which is
why the U.S. should not fritter them
away.
Mr. Blanc, a senior fellow at the
Carnegie Endowment for International Peace, was the State Department coordinator for Iran nuclear
implementation (2015-17).
THE WALL STREET JOURNAL.
A16 | Wednesday, August 30, 2017
WORLD NEWS
Lebanon Boots Islamic State From Its Turf
Victory for U.S.-trained
forces is latest defeat
for terrorists after
losses in Iraq, Syria
RAS BAALBEK, Lebanon—
One of the lesser-known chapters of Islamic State’s occupation of parts of the Middle East
drew to a close on Tuesday,
with Lebanon reclaiming all
the territory that the extremist
group controlled in the country
for the past three years.
Lebanese forces said they
had captured the last sliver of
land held by Islamic State after
they launched a ground operation this month to clear the
militants from the roughly 120
square kilometers of rugged
mountain terrain near the border with Syria where they
were based.
“All the lands are now Lebanese and secure,” Lebanese
Army Brig. Gen. Fadi Daoud,
who commanded troops during
the ISIS offensive, said in an
interview on Tuesday.
Lebanon is the latest in a
string of military defeats for
Islamic State. The extremist
group has lost more than half
of the territory it captured
three years ago in a blitz
across Iraq and Syria.
It recently lost its Iraqi
stronghold of Mosul and was
defeated this past weekend in
the strategic town of Tal Afar
near Iraq’s border with Syria.
The militants are also rapidly
losing ground in Raqqa, their
de facto capital in Syria.
The victory for the U.S.trained and equipped Lebanese
forces was an important milestone, removing a threat that
had been hanging over Lebanon for years. It also helped
boost the reputation of the
PATRICK BAZ/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY MARGHERITA STANCATI
Lebanese army soldiers drove vehicles flying the Lebanese flag this week in an area they recently took from Islamic State militants, during an army-organized press tour.
army, which has struggled to
demonstrate it can be the sole
guarantor of the country’s security.
“The Lebanese army has
proved itself. It has shown it
can take on Islamic State,” said
Fawaz Gerges, a Lebanese academic and author of “ISIS: A
History.” “This isn’t just a battle. Islamic State has suffered a
lasting defeat in Lebanon. It
has lost its foothold.”
Islamic State militants were
allowed to evacuate Lebanese
territory on Monday under
terms of a controversial surrender deal brokered by the
Iran-backed Lebanese militia
Hezbollah. Hezbollah is the
most powerful group in Leba-
non, and it has played a vital
role on the Syrian battlefield
propping up the regime of
Bashar al-Assad.
In the operation, Hezbollah
and the Lebanese army both
contributed to beating back
the Sunni extremists of Islamic
State from the country’s borders. Syrian forces and Hezbollah pressed their own offensive
against Islamic State from the
Syrian side of the border at the
same time as the Lebanese
army fought on its side.
Hezbollah’s deal with Islamic State drew criticism
from many in the country, who
saw this as a humiliation. The
Lebanese military denies cooperating with Hezbollah.
Lebanon has suffered from
spillover of the conflict in
neighboring Syria that has
been going on for more than
six years. Islamic State established a foothold along the
country’s largely uninhabited
northeast and briefly overran
the border town of Arsal in
2014. Its fighters kidnapped 30
Lebanese soldiers and policemen, most of whom were later
released in a prisoner swap.
But the fate of nine missing
soldiers remained unknown.
On Sunday as part of the surrender agreement with Hezbollah, Islamic State revealed the
location of eight of their bodies in return for being allowed
to evacuate with their family
members.
Around 600 people on Monday departed on buses for the
eastern Syrian province of Deir
Ezzour, which is one of the terror group’s last strongholds.
Lebanese military officials say
they believe the ninth soldier
had joined Islamic State and
was later killed in a battle in
Syria.
The offensive was a test for
the state’s army to prove its
ability to secure the country.
But despite repeated assurances from government officials that the military would
lead the battle to clear Islamic
State from the border region,
Hezbollah played an important
role.
Manila Vows ‘Big Battle’ to Expel Militants
Nearly 100 days after Islamic State-linked militants
occupied the southern Philippine city of Marawi, the army
said it was planning a final assault to end a battle that took
Manila and allied countries by
surprise for its stubbornness
and violence.
If successful, the operation
will allow the tens of thousands of residents who fled to
return home. But counterterrorism experts and humanitarian workers said the government faces a mammoth task of
rebuilding a devastated city
and risks further attacks elsewhere by energized terrorists.
Military Chief of Staff Gen.
Eduardo Ano told reporters Monday that the army was
preparing “one big battle” to
retake Marawi after clearing
the city’s Grand Mosque and
municipal police station last
week. He didn’t give details.
On Tuesday, reflecting international concern about the
spread of violence throughout
the region, Australia offered to
deploy special-forces soldiers
to the southern Philippines to
FERDINAND CABRERA/AGENCE FRANCE-PRESSE/GETTY IMAGES
BY JAKE MAXWELL WATTS
Smoke rose from Marawi as fighting continued in the city on the island of Mindanao on Monday.
provide training and tactical
advice. The U.S. already maintains a similar detachment as
part of its global counterterrorism operations.
Reclaiming the city of
200,000 has been an uphill
battle for the ill-equipped
Philippine military, which is
unused to urban warfare. Its
failure to end the conflict
swiftly and the use of destructive airstrikes have alienated
the population, many of whom
as Muslims feel marginalized
in the Roman Catholic-majority country.
Samira Gutoc—a former
negotiator for peace talks between the government and
more-traditional rebel groups,
who now serves as a humanitarian worker—said the extent
of the damage, with as much
as 90% of the city destroyed,
has led some youngsters to
call the militants heroes.
“We are creating another
generation of angry, young,
restless, jobless, alienated
kids,” Ms. Gutoc said.
A coalition of extremist Islamist groups, who for years
existed as rival religious or
criminal gangs, joined forces
to occupy Marawi on May 23,
riding on trucks and waving
the black Islamic State flag.
The Philippine military estimates about 40 remain in
Marawi and that 600 have
been killed. About 130 soldiers
and 45 civilians, some of
whom were beheaded, have
also died.
“I think what’s going to
happen is we’re going to see
some of the fighters disperse
into other areas,” said Sidney
Jones, director of the Jakartabased Institute for Policy
Analysis of Conflict. Ms. Jones
said she expects to see attacks
in other parts of the Philippines, along with the danger
that surviving fighters could
create a regional training center for aspiring jihadists.
There is also the risk of violence spreading to other parts
of Southeast Asia, such as
neighboring Indonesia, the
world’s most-populous Muslim-majority nation. Several
killed in Marawi were foreigners, including Indonesians.
For most of Marawi, prospects remain bleak. Save the
Children, a charity, said this
month more than half of the
60,000 children who fled the
fighting haven’t re-enrolled in
school. The military says many
residents can’t return due to
improvised explosive devices
militants have placed in the
city.
Hezbollah frequently points
to the Lebanese military’s
weakness as a reason for its
existence. But critics accuse
the militia of undermining the
military to preserve its leading
role protecting the country.
“We would have won. The
victory would have been complete and we would have captured senior leaders of Daesh
[ISIS]. This didn’t happen and
the responsibility is of the Lebanese government,” said Khalil
Helou, a retired Lebanese
Army general who informally
advised military commanders
during the operation. “Our
army did a great job, but its
success was overshadowed by
this humiliating deal.”
Taliban Claim
Bombing of
Kabul Bank
Associated Press
KABUL—A suicide bombing
in a busy commercial area in
Kabul near a string of banks
and not far from the U.S. Embassy killed at least five people on Tuesday, Afghan officials said. The Taliban claimed
responsibility.
Separately, at least 13 civilians were killed in an overnight airstrike by the Afghan
air force that targeted the Taliban in western Herat province.
In the Kabul attack, the explosion likely targeted a
branch of privately owned Kabul Bank, according to Basir
Mujahid, spokesman for the
Kabul police chief. The U.S.
Embassy compound is located
about 500 yards down the
road from the bank.
In addition to the five
killed, nine people were
wounded in the Kabul attack,
said Mohammad Salim Rasouli, chief of Kabul hospitals
at the Health Ministry.
Mexico’s Stubbornly Low Pay Emerges as Target in Nafta Talks
CIUDAD JUÁREZ, Mexico—
Emma Palacios started working
in factories in this city on the
Texas border in 1994, the year
the North American Free Trade
Agreement came into effect.
Ever since, she says, it has been
easy to find work at the scores
of U.S.-owned factories that
opened here. What’s proved
harder to find is decent pay.
After 11 years with a major
automotive supplier, Ms. Palacios was earning $1 an hour
plus benefits last year. She and
dozens of co-workers staged a
walkout to demand a six-centan-hour bump in pay. She
ended up losing her job, and is
now at another factory—for
even less pay.
“We didn’t resolve anything,” said Ms. Palacios, a 37year-old mother of four.
Mexico has reaped enormous benefits in industrial development and jobs from the
23-year-old pact, which U.S.,
Canadian and Mexican officials
started renegotiating this
month and will discuss again
at a second round in Mexico
City on Friday. What it hasn’t
achieved are significantly bet-
ter—or often even livable—
wages for Ms. Palacios and
millions of other workers.
Labor advocates from all
three countries say Mexico’s
low pay—the minimum wage is
$4.50 a day, and $100 a week
is considered among the best
factory-floor wages—create
unfair competition for U.S. and
Canadian workers and hobble
Mexico’s economic growth.
Now, U.S. and Canadian
trade officials and labor advocates want to use the Nafta renegotiation to prod Mexico
into raising its wages.
“Higher wages in Mexico are
in the interests of Mexico and
the U.S.,” economist Peter Navarro, a trade adviser to President Donald Trump, told The
Wall Street Journal recently.
“Without this adjustment Mexico will never have a robust
middle class, and our middle
class will wither if not die.”
With that in mind, the U.S.
is expected to push for tougher
labor standards, such as ensuring Mexican workers may
freely organize unions and
stage strikes without losing
their jobs.
“Low labor standards are an
unfair advantage,” Robert
$25 an hour
20
15
U.S.
10
JOSE LUIS GONZALEZ/REUTERS
BY DUDLEY ALTHAUS
5
Mexico*
0
’94
2000
2010 ’16
Workers on an assembly line in the border city of Ciudad Juárez.
Lighthizer, the U.S. Trade Representative, told the House
Ways and Means Committee
recently, espousing a view
many congressional Democrats
also hold.
When Nafta began in 1994,
labor and environment standards were relegated to largely
toothless side agreements.
Mexican officials say they are
open to including mechanisms
to ensure stricter enforcement
of its labor laws. What they
don’t want, they say, are measures that force Mexico to
raise wages.
“We think wages are part of
the free market and we want
to keep it that way,” said Moi-
sés Kalach, a member of the
private-sector board that advises the Mexican government
on the negotiations.
Wages have remained low in
Mexico for many reasons, and
any modified labor standards
in Nafta may have little impact
on raising them, at least in the
short run.
The country’s population
has surged by three-quarters in
30 years, to 123 million, outstripping the supply of good
jobs. Half the country remains
poor. Low productivity plagues
the four-fifths of the economy
not involved in manufactured
exports. And nearly six in 10
workers work off the books in
the informal sector.
Even within the manufacturing-export sector, where
productivity is growing, Mexico faces stiff competition from
China and other low-cost locations in Asia.
The failure of wages to rise
faster partly reflects the same
global pressures that keep U.S.
wages from climbing faster,
said Alfonso Navarrete Prida,
Mexico’s labor secretary, such
as increasing automation.
Now working from dawn to
midafternoon on an assembly
line, Ms. Palacios is increasingly dissatisfied with the
chronic low pay.
“I don’t know why I’ve been
satisfied with this all these
years,” Ms. Palacios said in the
dirt yard of her home. “But
these are the only jobs available for me. I have to care for
my family.”
PROPERTY REPORT: INVESTORS TARGET DISTRESSED SITES B6
BUSINESS & FINANCE
© 2017 Dow Jones & Company. All Rights Reserved.
S&P 2446.30 À 0.08%
S&P FIN g 0.47%
THE WALL STREET JOURNAL.
* * * **
S&P IT À 0.41%
DJ TRANS À 0.88%
WSJ $ IDX À 0.15%
LIBOR 3M 1.317
Wednesday, August 30, 2017 | B1
NIKKEI (Midday) 19468.73 À 0.55%
Aerospace Firms Close In on Deal
United Technologies’
tie-up with Rockwell
would form huge maker
of aircraft equipment
United Technologies Corp.
is nearing a deal to buy Rockwell Collins Inc. for more than
$20 billion, a tie-up that
would create one of the
By Dana Mattioli,
Joann S. Lublin
and David Benoit
world’s biggest aircraft-equipment makers.
The companies are discussing a per-share price for Rockwell of $140 or less and could
come to an agreement as soon
as this weekend, according to
people familiar with the situation.
Rockwell shares rose on
the news, first reported by
The Wall Street Journal Tuesday, closing up 2.1% at
$130.74 and giving the company a market value of about
$21 billion. United Technologies, meanwhile, jumped 2.9%
to $118.70, giving the industrial conglomerate a market
value of about $95 billion.
United Technologies investors
cheered the likelihood that
the company will be able to
secure the deal without paying a higher price that some
had expected.
As with all acquisition talks,
it’s possible these could hit a
snag and not result in a deal,
or the expected price could
change.
Should the transaction happen, it would rank as the larg-
$20B
The acquisition’s expected price
exceeds this amount
est aerospace deal on record,
eclipsing United Technologies’
2012 acquisition of Goodrich
Corp. for about $16.5 billion,
according to Dealogic. It
would also be one of the fivebiggest takeovers of the year,
Dealogic data show.
The deal would boost
United Technologies’ business
supplying Boeing Co. and Airbus SE as the aerospace industry ramps up for a new generation of jets. The company
already owns one of the
world’s biggest jet-engine
makers, Pratt & Whitney, part
of an aerospace division that
also makes parts such as
wheels and landing gear.
Rockwell specializes in
cockpit displays and communications systems for passenger
jets and military programs. In
April, the Cedar Rapids, Iowa,
company closed its roughly $6
billion acquisition of B/E Aero-
space Inc., a maker of plane
seats and interiors.
Since word of the talks
surfaced this month, several
analysts have said they don’t
expect significant antitrust
issues, given that United
Technologies and Rockwell
make different airplane parts.
But airplane manufacturers
might voice concerns about
any consolidation among
their suppliers. Boeing and
Airbus have also been nudging their way into aftermarket business to capture some
of the profit from selling and
servicing parts—putting them
on a collision course with
suppliers.
The possibility of a United
Please see DEAL page B2
HEARD ON
THE STREET
By Dan Gallagher
New Phone
Prices Are
Going to
The Edge
Dialed Down
Share of global smartphone sales
100%
Others
75
50
25
Huawei
Apple
Samsung
0
2012 ’13 ’14 ’15 ’16
Source: IDC
THE WALL STREET JOURNAL.
A woman, who identified herself as Diana Ilic, meets with analyst Chris Irons of GeoInvesting at a restaurant in Philadelphia.
GEOINVESTING LLC
The newest
smartphones
are taking
their screens
to the edge.
Apple Inc.
and Samsung Electronics
seem to be doing the same
with prices, in what amounts
to a gamble to revive
growth.
Both companies saw
smartphone revenue decline
in their latest fiscal years.
They are betting they can
revive growth by selling
ever more expensive
phones. Last week, Samsung
unveiled its Galaxy Note 8,
which offers an edge-toedge display design using
curved glass and organic
light-emitting diode
technology.
It is expensive: Samsung’s
Galaxy Note 8 will start at
around $950 depending on
the carrier, which is 8% to
12% higher than the starting
price of last year’s Galaxy
Note 7. Apple is expected to
introduce three iPhone
models Sept. 12. At least one
model is seen starting at
$1,000 or more.
Price increases seem risky
in a slowing market, though
Apple may be hoping to
repeat some of the success
of the iPhone 6, which
launched in late 2014. That
phone boosted both iPhone
unit sales and Apple’s
operating profit by more
than 36% for the company’s
2015 fiscal year.
The iPhone’s average
selling price rose 11% to $671
for the same period. Apple’s
stock price, which rose about
30% in the six months prior
to the iPhone 6 launch,
gained another 30% in the
six months that followed.
Still, prices approaching
$1,000 will be a shock. A
Barclays survey earlier this
month found that only 18%
of iPhone users are willing
to pay more than $1,000.
Both Apple and Samsung
have proven skilled at
making eye-catching designs.
But now the price of those
new designs seems likely to
make their customers’ eyes
bulge.
Mystery Visitors Dog Insurer’s Critics
BY MARK MAREMONT
Critics of AmTrust Financial Services Inc., which is being probed by a regulator and
pressured by investors, say
they have been approached by
a series of purported overseas
consultants dangling enticing
offers. Afterward, the critics
discover these people aren’t
who they say they are.
Chris Irons, an analyst at research firm GeoInvesting LLC,
which has published several
reports critical of AmTrust’s
accounting practices, said he
was contacted in July by a
woman who identified herself
as a London-based consultant
to a European software multimillionaire seeking contributors to a new investment website. He agreed to meet at a
Philadelphia-area restaurant.
At the dinner, Mr. Irons
said, the woman, whom he described as gorgeous, plied him
with drinks and slipped in several questions about critiques
of AmTrust and its accounting
methods. “It was the second or
third follow-up question on
AmTrust that gave me a lot of
said she was either. The socialmedia pages under her name
used photos of another
woman, a French retail marketer. The purported Ms. Ilic
didn’t return phone calls or
emails to the contacts provided to Mr. Irons.
AmTrust, a rapidly growing,
New York-based insurance
company with $5.5 billion in
2016 revenue, in recent years
has attracted skepticism about
its results from investors betting against its stock, which
has nearly halved this year.
Please see INSURER page B2
pause,” he said, adding that
she “laughed at many things I
said that probably weren’t that
funny.”
But the name the woman
gave—Diana Ilic—appears to
be a pseudonym. The email address she used with Mr. Irons
links to a domain name established a few days before the
meeting. The London address
for her consulting firm turns
out to be a mailbox drop.
A woman who made initial
contact on social media on behalf of the purported Ms. Ilic
doesn’t appear to be who she
Harvey’s Destruction Tests U.S. Shale
HOUSTON—Tropical Storm
Harvey, the most powerful
storm to hit Texas in half a
century, has shut a significant
portion of the state’s shale production, cutting off as much as
By Lynn Cook,
Bradley Olson
and Alison Sider
15% of U.S. oil supplies.
Now, in what is the first
major storm to test U.S. shale,
the big question is how quickly
the sector can make a comeback.
As the storm’s widespread
devastation has come into focus, several analysts say that
much, if not most, of the 1.4
million barrels of oil produced
daily in the Eagle Ford shale of
South Texas has been cut off
and may not return for weeks.
The Eagle Ford, which is on
the doorstep of Corpus Christi
where the storm made landfall, is second in output in the
state only to the Permian Basin of West Texas.
Early indications from a
handful of companies are that
the severity of the storm was
much greater than expected,
but damage to fields was mod-
See more at WSJMarkets.com
Media Player Battle
Apple has lost market share to
rivals that offer higher resolution
media players.
100%
Roku
80
60
Amazon
40
Google
20
Apple
Others
0
1Q 2015 1Q ’16 1Q ’17
Source: Parks Associates
THE WALL STREET JOURNAL.
Apple,
Movie
Studios
At Odds
Apple Inc. is scrambling to
strike deals with Hollywood
studios to offer ultrahigh-definition films on its new Apple
TV, but discussions have been
hampered by disagreements
over pricing, according to people with knowledge of the
talks.
The tech giant will unveil
the new version of its streaming media device at an event
Sept. 12 and tout its compatibility with new 4K televisions,
people with knowledge of its
plans said. The 4K format offers more than 8 million pixels
per
frame—significantly
sharper than traditional highdefinition video at the same
size. Apple will also reveal updates to its iPhone and Apple
Watch, according to people
briefed on its plans.
Apple wants to have major
Hollywood films available in
ultrahigh definition on the
new device, expected to go on
sale later this year. However, it
wants to charge $19.99 for
those movies—on par with
what it sometimes charges for
new HD movies, the people
with knowledge of the discussions said. Several Hollywood
studios want to charge $5 to
$10 more for 4K movies, the
people said.
Conflicts over pricing between Apple and media companies are nothing new. The
technology company typically
argues lower prices will help
expand a category and generate more long-term revenue,
while studios often worry
more about preserving profit
margins and higher prices for
higher quality formats.
“I wouldn’t tell Apple how
to price their iPads,” said an
executive at one studio in
talks with Apple.
An Apple spokeswoman declined to comment.
Closing deals with studios
Please see APPLE page B2
INSIDE
In the Wake of the Storm
The deluge of rain in one of the petroleum industry’s busiest areas has reduced the flow of oil
to refineries, pipelines and tankers. Some of the impact as of Tuesday:
Magellan pipeline Shut down
Explorer pipeline
Could be shut down
Exxon Beaumont
refinery
Reduced capacity
Houston
LyondellBasell
refinery
Reduced
capacity
T EXAS
Koch Industries
refinery
Shut down,
trying to
restart
Colonial
pipeline LA .
At reduced
rates
Motiva refinery
40% capacity
Rainfall totals in inches
Thursday-11 a.m. Tuesday
5
Tankers
anchored
Tuesday
Gulf of Mexico
10
20
30
Petroleum infrastructure
600k
200k
Barrels/day:
GOOGLE TO
CHANGE
SEARCHES IN EU
TECHNOLOGY B4
Pipelines
Offshore platforms
Corpus Christi
Sources: NOAA (rain); Energy Information Administration (infrastructure); MarineTraffic (tankers)
erate, according to Paul Sankey, an equities analyst with
Wolfe Research. Many big
shale producers in the Eagle
Ford shut their oil and gas
wells before Harvey made
landfall as a hurricane Friday.
While some companies
made efforts to restart production Tuesday, a snarled supply
chain is keeping a lot of oil in
the ground for now.
Shale producers rely on a
vast multibillion-dollar network of energy infrastructure—from ports to train
tracks to pipelines—that has
developed in recent years
along the Texas coast. Many
pieces of that network appear
to be swamped, and since
there hasn’t been a storm of
this magnitude since shale
drilling took off about a de-
THE WALL STREET JOURNAL.
cade ago, it is harder to predict how long it will take for
the infrastructure to recover.
ConocoPhillips, one of the
biggest producers in the area,
normally pumps 130,000 barrels a day in the Eagle Ford; it
shut its wells ahead of the hurricane. As of Tuesday, it had
restarted some fields on a limited basis but was struggling
Please see SHALE page B2
THE EURO’S
RISE GIVES
PAUSE TO ECB
MARKETS B13
B2 | Wednesday, August 30, 2017
INDEX TO BUSINESSES
These indexes cite notable references to most parent companies and businesspeople
in today’s edition. Articles on regional page inserts aren’t cited in these indexes.
A
Abbott Laboratories...B5
Advisory Board...........B3
Akamai TechnologiesB13
Allegiance
Bancshares............B12
Alliant Energy...........B14
Allstate ..................... B14
Alphabet......................B4
Amazon.com..........B3,B4
Ameren......................B14
AmTrust Financial
Services.....................B1
Apple...........................B1
B
Bank of America.......B12
Bank of Nova Scotia B12
Barclays.....................B12
Berkshire
Hathaway ........ B12,B14
Best Buy ..................... B3
Blackstone Group ....... B6
Boeing..................B1,B13
C
Cantor Fitzgerald......B12
Cargotec......................B5
CenterPoint Energy .. B14
CME Group..................A6
Colliers International . B7
Cushman & WakefieldB6
CVS Health..................B4
D-E
Delshah Capital...........B6
Descartes Systems
Group.........................B4
Deutsche Bank..........B14
Elliott Management ... B3
Expedia........................A1
F
Facebook ..................... A5
FourKites.....................B4
Freeport-McMoRan.....B3
G
Gap .............................. B7
Goldman Sachs
Group..................B12,14
Green Bancorp .......... B12
H
Hain Celestial Group .. B3
Home Depot................B4
J
P
Petróleos de
Venezuela ............... B12
Progressive ............... B14
Prosperity
Bancshares............B12
Prudential Financial....B5
R
Red Hat.......................B5
Rockwell Collins..B1,B13
S
Samsung Electronics..B1
Sky...............................B3
State Farm................B14
Symantec .................... B5
T
J.P. Morgan
Chase..............B12,B14
K
Kantar Retail .............. B7
Kik Interactive..........B13
KKR..............................B6
Kohl's...........................B6
Kroger..........................A5
M
Madison Realty
Capital......................B6
Mansfield Oil .............. B2
Micron Technology....B13
N
Nestle........................B14
New York Times.........B5
Noble Group..............B14
Nordstrom...................B7
Northwell Health........B3
THE WALL STREET JOURNAL.
* ***
Target..........................B7
The Vanguard Group...B5
Trepp............................B7
Twitter........................A5
21st Century Fox........B3
BUSINESS & FINANCE
DEAL
Continued from the prior page
Technologies deal for Rockwell
caught some analysts by surprise. In June, United Technologies Chief Executive Greg
Hayes told analysts the Farmington, Conn., company was
looking to spend roughly $1
billion on acquisitions this
year. It had about $7 billion in
cash.
“As far as bigger M&A, it’s
something we always look at,
but I am reluctant to go out
and pay some of the prices
that we see today,” Mr. Hayes
said at the Paris Air Show.
Last year, United Technologies, which also makes Carrier
climate control systems and
Otis elevators, rebuffed unsolicited takeover approaches
from Honeywell International
Inc.
Merger activity has been
somewhat tepid this year, as
uncertainty around possible
tax changes and other factors
have kept companies on the
sidelines.
Deal volume in the U.S. so
far stands at about $803 billion, down 14%, according to
Dealogic.
—Thomas Gryta
contributed to this article.
Moonshot
The acquisition of Rockwell Collins by United Technologies
would be the largest aerospace deal on record.
TOP AEROSPACE DEALS
BUYER United
Technologies
United
Technologies
Boeing
Lockheed
Martin
Daimler
Chrysler
Aerospace
$16.5
$16.2
$9.1
$8.9
Goodrich
McDonnell
Douglas
VALUE
$20+
billion
(Estimated)
TARGET Rockwell
Collins
Sources: Dealogic; staff reports
Sikorsky Aerospatiale
Matra
Aircraft
THE WALL STREET JOURNAL.
U
Uber Technologies......A1
Unilever.....................B14
UnitedHealth Group....B3
United
Technologies......B1,B13
V
Vista Equity Partners
Management.............B3
W
Wells Fargo...............B12
Whitestone.................B7
Z
Zions Bancorp...........B12
B
Heady, Mindy..............B6
Marcotte, David..........B7
Baker, Doug.................B5
Hertling, Mark ............ B5
McGuire, Richard......B13
Buffett, Warren.B12,B14
Hochman, Rod.............B3
Miller, Trip.................B13
C
J
Monsen, Wendy..........B5
Clancy, Manus.............B7
Joly, Hubert ................ B3
P
D
Joslove, Scott.............B7
Patel, Viraj................B13
S
De Figueiredo, Rui....B13
K
DeHaan, Patrick..........B2
Kalanick, Travis .......... A1
Dobrowski, Thomas....B6
Khosrowshahi, Dara...A1
F
Krosby, Quincy..........B14
Foran, Brian .............. B12
L
G
Lembong, Tom ............ B3
Gelb, Jay ................... B14
Loeb, Dan..................B14
H
M
APPLE
Continued from the prior page
before Sept. 12 is important to
Apple as it tries to reignite interest in the TV product it
first launched in 2007. The
company has been losing market share lately to streamingmedia players from rivals such
as Amazon.com Inc. and Roku
Inc., which already offer devices with 4K capability that
cost at least 60% less than the
$149 Apple TV. Its market
share fell to 15% in the first
quarter this year from 19% a
year earlier, according to
Parks Associates, a market research firm.
The Apple TV accounts for a
fraction of the company’s revenue, but research by Kantar
Worldpanel has found that
owning additional Apple devices strengthens consumer
loyalty to the iPhone, which accounts for two-thirds of sales.
“Historically, Apple has
looked at the levers they can
pull to be competitive, and
they’ll have to have richer 4K
content to leapfrog other competitors,” said Matt Smith,
vice president at Brightcove
Inc., which provides online
video services.
The availability of Hollywood films in Ultra HD, another term for 4K, also could
rejuvenate the iTunes Store.
The company’s movie rentaland-sales business has been
losing market share to rivals
such as Comcast Corp. and
Amazon, falling below 35%
from about 50% in 2012.
Ultra HD movies have been
SHALE
Continued from the prior page
with the pipelines and trucks
needed to take the crude away.
“The effect to shale could
linger given the extent and
catastrophic level of forecasted flooding, which interferes with shale logistics,” said
Benny Wong, an analyst with
Morgan Stanley.
In the past, hurricanes have
dealt a blow to the Texas energy industry by knocking out
offshore oil platforms in the
Gulf of Mexico; but in many
cases, once storms passed,
those big installations could
quickly return to pumping
crude.
The fracking-induced boom
in Texas has heightened the
state’s role in the U.S. economy, which means that if the
oil fields and surrounding infrastructure are out of service
for long, it could have outsize
economic impacts on the state
and shave $20 billion or more
DANIEL ACKER/BLOOMBERG
INDEX TO PEOPLE
Schneider, Mark........B14
Smith, Matt................B2
Sullivan, Bill................B3
V
Vautrinot, Suzanne.....B5
W
Wheeler, Darrell ......... B7
Witkoff, Steven..........B6
available online for less than
two years, and an executive at
one studio said pricing is still
in the testing phase. An executive at another studio said
$19.99, Apple’s preferred price
point, would likely prove more
popular with consumers given
the vast amount of content
available for $12 or less a
month from Netflix Inc., which
offers a limited number of Ultra HD movies and television
shows.
Streaming service Vudu,
owned by Wal-Mart Stores
Apple has been losing
market share lately to
streaming-media
players from rivals.
Inc., already offers some digital movies in Ultra HD. “Baywatch,” from Viacom Inc.’s
Paramount Pictures, and “King
Arthur,” from Time Warner
Inc.’s Warner Bros., cost
$29.99 while Walt Disney Co.’s
“Guardians of the Galaxy Vol.
2” is $24.99.
Hollywood’s biggest studios, a group that includes
Disney, Paramount, Warner,
Comcast Corp.’s Universal
Pictures, 21st Century Fox
Inc.’s Twentieth Century Fox,
Sony Pictures Entertainment
and Lions Gate Entertainment Corp., are eager to establish a new category for
digital movie sales, particularly as that business’s
growth has been slowing in
recent years.
off U.S. gross domestic product, said Joe Brusuelas, chief
economist with RSM US LLP,
an accounting and consulting
firm.
More than 15% of U.S. refining capacity is closed in the
wake of the storm. That
prompted crude prices to drop
more than 2.5% since Friday to
$46.44 a barrel, largely because closed plants don’t need
to buy any crude.
If they stay shut, or if the
ports where they are located
sustained damage that takes
weeks to repair, producers
won’t be able to turn their
spigots back on. Prolonged refinery outages could lead to
fuel shortages in different
parts of the country.
Companies were trying
Tuesday to assess the damage
to their facilities. But the
sprawling nature of the
storm—it was downgraded
from hurricane status on Saturday—and continued rain in
some areas hampered those efforts.
Wind and water damage
Iowa-based Rockwell Collins specializes in cockpit displays and communications systems for passenger jets and military programs.
INSURER
Continued from the prior page
The Wall Street Journal, citing
people familiar with the matter, reported this year that the
Securities and Exchange Commission was investigating
AmTrust’s accounting practices.
Other AmTrust critics described similar odd approaches to the Journal, including an investor who is
betting against AmTrust’s
stock; a journalist who has
published articles critical of
AmTrust’s founders; and Mr.
Irons’s boss, who said he had
met two months earlier with
a different “consultant” dangling a lucrative offer, who
then brought up AmTrust.
That consultant, the GeoInvesting team later found, used
the same London mailbox drop
as Ms. Ilic.
Battles between companies
and short sellers sometimes
turn nasty, and both sides in
such disputes occasionally
have used private investigators
to dig up information, usually
in a legitimate fashion. The investigators often are hired
through law firms and the information sometimes is used
in litigation.
An AmTrust spokeswoman
said the company didn’t employ investigators to probe its
critics. It declined to say
whether its lawyers or others
in its service had done so. The
company has declined to comment on the SEC probe.
AmTrust this year restated
some results with relatively
minor changes after switching
outside auditors.
Investigators using fake
identities and misrepresentations could run afoul of several
state and federal laws, said
Gavin P. Lentz, a Philadelphia
attorney and former prosecu-
Storm Disrupts Key
Colonial Pipeline
tor, who isn’t involved in the
matter.
A company that hires such
investigators potentially could
be held civilly liable, Mr. Lentz
said, because these are agents
acting on their behalf.
“Generally speaking, as a
private investigator you can’t
misrepresent yourself” in the
U.S., said James Cesarano, vice
president of ethics and compliance at Kroll Associates Inc., a
corporate investigations firm.
AmTrust has been in a longrunning battle with short sellers—investors who bet against
its stock—and other critics,
who have claimed the insurer
burnishes its financials partly
by underestimating future
claims and through reinsurance transactions with over-
seas affiliates that had the effect of hiding losses.
AmTrust, which denies such
allegations, several years ago
filed a legal notice threatening
to sue GeoInvesting and a vocal short seller, Casey Nelson.
AmTrust also has attacked
short sellers several times on
investor conference calls. On a
May call, Chief Executive Barry
Zyskind called short-seller
claims “false” and “baseless.”
The ostensible consultants
contacting AmTrust critics
have legitimate-seeming websites and social-media identities. They also leave little apparent
trace
of
their
whereabouts. The woman who
called herself Ms. Ilic, for example, arrived and left in an
ordinary taxi and paid for the
Unusual Offerings
Some critics of insurer AmTrust have cited odd consultant outreaches.
AmTrust share price
$30
20
10
0
2016
’17
June 27, 2016: Casey Nelson, a vocal AmTrust short seller, contacted
by consultant offering to invest in his fund and fly him to London
July 12, 2016: Journalist Roddy Boyd meets in London with adviser to
Asian family looking to set up venture; is asked AmTrust questions
April 27, 2017: Mr. Boyd, who has written about AmTrust’s founders,
contacted by British man wanting information on AmTrust in exchange
for donation
May 10, 2017: Dan David of GeoInvesting, a research firm critical of
AmTrust, meets French/British consultant who wants him to speak at
London conference, asks questions about AmTrust
July 18, 2017: GeoInvesting's Chris Irons meets London consultant who
makes repeated AmTrust queries after offering work with investing website
Sources: WSJ Market Data Group (price); the critics
THE WALL STREET JOURNAL.
Flooding in Texas has
spawned local fuel shortages
from Austin to Dallas and disrupted the flow of petroleum
on a major pipeline that moves
gasoline, diesel and jet fuel to
the East Coast.
The Colonial Pipeline said its
system, which runs from Texas
to New Jersey, is starting to
have problems stemming from
Tropical Storm Harvey. The notice from the company adds to
concern that Houston’s hard-hit
energy infrastructure could result in higher fuel prices or
shortages.
Gasoline supplies in Dallas
and San Antonio have been significantly reduced, and fuel supply is becoming more limited in
Austin as well as areas as far
away as Atlanta, according to
Mansfield Oil, a nationwide fuel
wholesaler in Gainesville, Ga.
Gasoline prices will continue
to rise and the “national average will soon hit its highest
since 2015,” said Patrick DeHaan, an analyst with GasBuddy.com.
Service at Colonial Pipeline’s
fuel loading and pumping stations in Houston, Pasadena and
Cedar Bayou, Texas, have been
interrupted. The company
wouldn’t quantify how much
fuel continues to flow on the
system late Tuesday.
The Colonial is the biggest
fuel pipeline in the U.S., stretching 5,500 miles through 12
states. Analysts have likened it
to “a Mississippi River of fuel.”
It can transport up to 2.5 million barrels a day of gasoline,
diesel and jet fuel.
—Lynn Cook
and Dan Molinski
and outages from the storm
have doused tens of thousands
of square miles with torrential
rainfall and ravaged a wide
swath of coastline, halting the
flow of up to $800 million a
day in energy-industry revenue, analysts said.
As the hurricane’s widespread devastation unfurled,
some companies confirmed
their operations had come to a
near standstill.
Big producers in the area,
including EOG Resources Inc.
and Chesapeake Energy Corp.,
stopped fracking, curbed production or suspended operations completely, analysts said.
EOG wouldn’t quantify how
much of its production is shut
down, but it said it is working
to resume operations “where it
is safe to do so.”
Chesapeake said that “while
it is premature to speculate on
the ultimate impact to our
production, we anticipate volumes will be restrained until
Gulf Coast and Houston refineries are back online.”
Shipping traffic in Houston,
Corpus Christi and other ports
meal with cash, Mr. Irons said.
Roddy Boyd, who has written articles for his Southern
Investigative Reporting Foundation that raised questions
about charitable foundations
run by AmTrust’s founders,
said he received two unusual
approaches.
A few months ago, he said,
a man claiming to be calling
from London offered to donate
money to his journalistic foundation, in return for answering
questions about AmTrust. Mr.
Boyd said he provided a few
generalities about the company and told the man not to
donate.
In mid-2016, Mr. Boyd said,
he traveled to London to meet
a man identifying himself as a
Hong Kong-based adviser to a
wealthy family interested in
starting an Asian journalism
venture. The consultant, he recalls, asked detailed questions
about his articles on AmTrust
founders.
Mr. Boyd said he later discovered the consultant’s background had holes; his Hong
Kong phone number has since
been disconnected. “Something was very wrong,” Mr.
Boyd said. He said the consultant was armed with a printout of an AmTrust critique by
Mr. Nelson, the short seller.
Mr. Nelson, of Dallas-based
Alistair Capital Management
LLC, said he was contacted
around the same time by a
London-based consultant, purporting to represent a Middle
Eastern investor looking to
hire Mr. Nelson’s firm to manage at least $50 million.
He said the man offered to
fly him to London to discuss
the offer. Mr. Nelson said he
was suspicious and declined
the offer. The consultant’s
email address is no longer active; his website domain was
registered to a mailbox drop
address.
may not be fully restored for
two weeks. That and other infrastructure limitations will
have a domino effect back to
production, said Tony Sanchez
III, chief executive of Eagle
Ford operator Sanchez Energy
Corp.
Restarting wells may not
guarantee that they resume
flowing at the same rate, he
said.
On a technical level he fears
that shale wells, once shut off,
could lose pressure. Most of
his company’s production
wasn’t shut in as it lies in areas west of the storm’s path.
“It’s not just a matter of
flipping a switch,” he said.
“There is significant risk in
those wells not coming back to
previous levels.”
The market may be underestimating Harvey’s impact because nothing like this flood
has ever happened to the shale
industry before, said Giovanni
Staunovo, a commodities analyst at UBS Wealth Management. “There is no historical
comparison,” he said.
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | B3
* * * *
BUSINESS NEWS
Best Buy
To Boost
Spending;
Stock Falls
Advisory Board Is Sold in Parts
BY KHADEEJA SAFDAR
BY ANNA WILDE MATHEWS
AND LAURA COOPER
The Advisory Board Co.
will be split up and sold in a
deal valued at around $2.21
billion, with its health-care
business going to UnitedHealth Group Inc. and its education unit to private-equity
firm Vista Equity Partners
Management LLC.
The consulting and software company had announced
in February that its board was
exploring strategic alternatives, including a possible sale.
That move came after activist
hedge fund Elliott Management Corp. said it and related
entities had bought about 8.3%
of the company’s shares, saying at the time they were undervalued and it wanted to engage in a dialogue with the
company’s board.
The companies said Tues-
day that the total value of the
deal was around $2.58 billion,
a figure that includes the assumption of debt. Advisory
Board shareholders will get
approximately $54.29 in cash
per share.
Vista will pay about $1.55
billion for EAB, the education
unit, which focuses largely on
colleges and universities. After
that deal closes, UnitedHealth
will complete its acquisition of
the Advisory Board’s health
operation, which goes by the
name of the parent company,
paying $1.3 billion including
the assumption of debt.
The Advisory Board, which
is a well-known name in the
hospital industry, had around
$803 million in revenue last
year.
The Advisory Board becomes the latest high-profile
takeover for UnitedHealth’s
Optum health-services arm.
Optum has grown rapidly over
the years with an aggressive
spate of acquisitions, bolting
together everything from a
burgeoning network of doctor
practices to a major pharmacybenefit manager to a large
outpatient surgery company.
Eric Murphy, chief executive of OptumInsight, the unit
that will absorb Advisory
Board, said there are “terrific
synergies” between the two
companies, with the acquisition bringing research and
other capabilities that Optum
doesn’t currently have.
Advisory
Board CEO
Robert
Musslewhite
will stay on at
the health-care
business.
UnitedHealth said Robert
Musslewhite, who is the chief
executive of the Advisory
Board parent company, will
continue to lead its consulting
work within Optum.
The acquisition may raise
questions among some Advisory Board clients, who entrust their data to the firm and
may rely on its work in their
pricing negotiations with big
insurers such as UnitedHealth-
care, the insurance unit of
UnitedHealth.
Michael J. Dowling, chief
executive of Northwell Health,
a big New York hospital system that is an Advisory Board
client, said before the deal was
announced that he would want
to understand the details. “It
would all depend as to what
the nature of the relationship
would be,” he said. “You’d
want to be able to be
sure…that the data is protected and doesn’t bleed into
other entities.” Northwell already has a good relationship
with Optum, which he expects
to continue, he said.
Rod Hochman, chief executive of Providence St. Joseph
Health in Seattle, a 50-hospital
system that is a customer of
Advisory Board consulting,
said he received a flurry of
emails from the Advisory
Board after the deal was announced seeking to reassure
customers. Providence St. Joseph Health also sells health
insurance in Oregon and Texas,
making it a competitor of
UnitedHealth.
Optum itself is already a
$700M
Amount slated for e-commerce
and supply-chain operations.
we’re seeing today is the
continued effect of the cumulative investments we’ve
made in simplifying and
streamlining the customer
experience.”
Mr. Joly said the company
plans to spend about $700
million in fiscal 2018 on ecommerce and supply chain
operations, higher than its
previous estimate of about
$650 million.
Gross margins in the latest
quarter were hurt by increased sales of low-margin
products such as wearable devices and by the shift to online
shopping.
Best Buy has been focusing
on services to reduce its dependence on new products releases. It has been testing out
new pricing models for its
Geek Squad unit, which installs products and provides
tech support, and rolling out
additional services.
Mr. Joly said the company
plans to roll out its in-home
advisory program, in which
employees visits customers’
homes and provide product
advice free of charge, across
the U.S. starting next month.
“They help customers do
things they would not have
otherwise done,” he said.
Over all, Best Buy’s revenue
climbed 5% in its second quarter to $8.9 billion. The company posted earnings per
share of 69 cents, up from 57
cents a year before.
The company raised its fiscal year 2018 revenue growth
outlook to 4% from 2.5%. The
outlook reflects the release of
the Apple’s next generation
iPhone. Apple has scheduled a
product announcement event
for Sept. 12.
—Cara Lombardo
contributed to this article.
Freeport-McMoRan will cut its stake in the Grasberg copper and gold mine to 49%, which could help end a dispute with Jakarta.
Freeport Eases Indonesia Tensions
BY ANITA RACHMAN
AND I MADE SENTANA
JAKARTA, Indonesia—Freeport-McMoRan Inc. will give
up its majority stake in the giant Grasberg copper and gold
mine in a significant step toward ending a long dispute
with Indonesia, dropping the
U.S. mining company’s ownership from 90.64% to 49%.
The agreement, announced
by Indonesian and Freeport
officials on Tuesday, will extend the mining company’s
permit until as long as 2041.
It caps an important chapter
in a struggle between Jakarta
and foreign mining companies
in recent years, as the Southeast Asian nation seeks a
greater share of the wealth
made from its vast mineral resources.
The agreement requires
Freeport to build a smelter by
October
2022—consistent
with a goal of President Joko
Widodo’s government to increase domestic-processing
capacity in Indonesia, but
seen by mining companies as
an extra cost at the same time
that slowing demand from
China has hurt commodity
prices.
Freeport Chief Executive
Richard Adkerson said the
company will invest as much
as $20 billion between now
and 2041 to develop what had
been a largely open-air mine
underground. Freeport has invested $12 billion in develop-
Waning
Mining's contribution to Indonesia's growth declined in recent years,
amid depressed commodity prices and government policy changes.
GDP growth
Mining industry’s contribution
to GDP
6%
6%
4
4
2
2
0
0
2006
’10
’16
2006
’10
’16
Sources: World Bank; Bank of Indonesia via PwC (mining industry’s contribution)
THE WALL STREET JOURNAL.
ing Grasberg, located in Indonesia’s eastern province of
Papua, since the 1970s. The
company is Indonesia’s largest
single taxpayer.
The divestment and the
agreement to build the
smelter, estimated to cost $2
billion, amounted to a “major
concession” from the company, Mr. Adkerson said.
“For us, the big issue is
having confidence that we can
make these investments and,
having an agreement with the
government, that we will have
time to recover those investments,” Mr. Adkerson said.
Freeport said in a statement released early Wednesday that the divestment will
be done in a way that will
leave the company in control
of the mine’s operations and
management.
Freeport’s current operating license expires in 2021 and
negotiations over its renewal
had been going on for years.
The company had been reluctant to make new investments
without an agreement in
place, and labor unrest had
been increasing.
Tom Lembong, chairman of
the Indonesia Investment Coordinating Board, called the
pact “a positive milestone”
but said both parties still have
to talk about details, such as
pricing and fiscal terms.
Under the new agreement,
Indonesia has agreed to extend Freeport’s license by 10
years to 2031, and if requirements are being met, a further
10 years.
The value of the 41.64%
stake Freeport will have to
sell remains to be determined.
The government and its stateowned enterprises are unlikely to have the financing to
buy it in one piece, so the divestment could be spread
across many holders and Freeport might retain the largest
single holding, analysts said.
Bill Sullivan, a Jakartabased legal adviser to mining
companies, said foreign investors could see the agreement
as a positive development—
depending on how outstanding details are resolved.
The mechanics, pricing and
timing of the divestiture are
critical issues, Mr. Sullivan
said, which, until resolved,
make it “impossible” to say
whether the long-running dispute between Freeport and Indonesia is over.
This agreement lifts a government threat to ban Freeport exporting a form of unrefined copper, which was to
have taken effect in October.
Copper prices rose to their
highest level in nearly three
years in Asian trading Tuesday, largely because of falling
Shanghai inventories, with the
benchmark three-month price
trading at $6,802 a metric ton
on the London Metal Exchange on Tuesday afternoon.
—Deden Sudrajat in Jakarta
and Biman Mukherji
in New Delhi
contributed to this article.
21st Century Fox Takes Fox News Off Air in U.K.
BY STU WOO
LONDON—Rupert
Murdoch’s 21st Century Fox Inc.
said Tuesday it stopped broadcasting its Fox News Channel
in the U.K., amid the media
conglomerate’s $15 billion bid
to buy the 61% of British paytelevision company Sky PLC
that Fox doesn’t already own.
Fox said it was a business
decision to withdraw Fox
News, which in the U.S. is popular with conservative viewers
and recently retained its No. 1
cable-news ranking despite a
sexual-harassment
scandal
that has roiled the unit and its
parent company.
major adviser to hospitals, as
well as insurers that compete
directly with UnitedHealthcare. UnitedHealth has always
said that Optum clients’ information is walled off completely from the company’s
corporate sibling, and Optum
has long been able to win business despite the relationship.
Mr. Musslewhite said it expected questions from some
clients about the UnitedHealthcare relationship, but
“we’ll be able to answer that
question easily.”
Vista Equity Partners invests in software, data and
technology-focused companies—including a major education-related firm, PowerSchool,
which
provides
software for the K-12 market.
The investment firm recently
closed its largest buyout fund,
collecting over $11 billion in
capital—making it one of the
largest technology-focused vehicles ever. Across its differentiated funds, the firm has
raised over $30 billion to pursue deals.
—Melanie Evans
contributed to this article.
Hain
Looks
Past Sales
Decline
MUHAMMAD ADIMAJA/ANTARA FOTO/REUTERS
Best Buy Co. reported another quarter of rising sales
but said it would increase
spending on its e-commerce
operations and supply chain to
boost growth in a competitive
marketplace.
The electronics retailer said
expenses were higher in its
fiscal second quarter and that
it plans to make similar investments in shipping, compensation and online operations in the next two quarters.
Focusing on profits would
be “shortsighted,” said Chief
Executive Hubert Joly, adding
that the company’s strategy
will be “offensive” and
“growth-oriented” as it battles
Amazon.com Inc. and other
retailers to sell smartphones,
laptops and other gadgets.
The retailer’s shares tumbled nearly 12% Tuesday to
close at $55.02, although they
remain up nearly 29% this
year.
Sales at stores open at least
a year increased 5.4% in the
July-ending quarter, more
than twice what analysts were
expecting. Much of the growth
came from e-commerce sales,
which rose 31% from a year
before to $1.1 billion.
“So much of the customer
experience has been starting
online,” Mr. Joly said. “What
UnitedHealth snares
health-care business,
Vista Equity to buy
education unit
“Fox News is focused on the
U.S. market and designed for a
U.S. audience and, accordingly,
it averages only a few thousand viewers across the day in
the U.K.,” a spokesman said.
“We have concluded that it is
not in our commercial interest
to continue providing Fox
News in the U.K.”
A spokesman for Sky said
the move was Fox’s decision.
Fox News went off U.K. airwaves at 4 p.m. British time.
Fed live from the U.S., its
prime-time shows in the U.S.
aired during Britain’s wee
hours. A person close to Fox
said the channel’s British operation lost money and aver-
aged only 2,000 viewers a day.
The person said the decision wasn’t related to Fox’s
bid to buy Sky, which had
been the only British broadcaster that aired Fox News.
Sky is a subscription service
that offers Fox News as part of
its offerings. Still, the decision
could affect the proposed acquisition’s regulatory gantlet.
Fox’s predecessor, News
Corp., abandoned a bid to buy
Sky in 2011 amid revelations
that a newspaper it owned
hacked into the phones of politicians and crime victims. The
company apologized, closed
the implicated newspaper and
spun off other newspapers
into a new company, which
took News Corp as its name.
Mr. Murdoch and his family
are major shareholders in Fox
and News Corp, which publishes The Wall Street Journal
as well as British newspapers.
In December 2016, Fox proposed acquiring the 61% of Sky
it doesn’t already own for
£11.7 billion ($15.1 billion). The
bid won approval from European Union antitrust authorities in April. But British Culture Secretary Karen Bradley,
who oversees media mergers
in the U.K., said in June that
she would likely refer the proposal to U.K. competition authorities after Britain’s media
watchdog said the merger
risked giving the Murdoch
family too much control of the
country’s media.
Britain’s media watchdog
this year examined the sexualharassment scandal. In June,
the watchdog said it considered allegations of sexual and
racial harassment at Fox News
“extremely serious,” but said
there was no clear evidence
that senior executives at Fox
were aware of misconduct before the issue was escalated to
them in July 2016, after which
action was taken. Fox has said
it is cooperating with U.S. government probes about the sexual-harassment claims.
BY ANNIE GASPARRO
Hain Celestial Group Inc.
said it expects sales of its organic chips and baby food to
rise next year despite a recent
investigation into its accounting practices.
Hain’s stock has languished
for the past year since it acknowledged accounting problems that prompted an investigation by securities regulators
and several missed earnings
reports. Hain and the Securities Exchange Commission
have declined to provide an
update on the status of that
probe in recent months.
Hain said Tuesday that the
outlook for its business is nevertheless improving. Hain expects fiscal 2018 sales of about
$3 billion—better than analysts were expecting—after reporting its fourth-quarter
sales slipped 2% to $725 million. Adjusted earnings per
share of 43 cents for the quarter, which ended June 30, were
flat while also topping analyst
forecasts.
Shares in the Long Islandbased company shot up early
Tuesday, but finished down
1.4% at $40.05.
Barclays analyst Andrew Lazar said enthusiasm over the
company’s outlook was likely
tempered by a 5% U.S. sales
decline in fiscal 2017 in the
face of tougher competition.
“The biggest thing we have
to do is connect with our consumers,” Chief Executive Irwin
Simon told analysts Tuesday.
A year ago, Hain said it was
reviewing whether revenue associated with concessions
granted to certain U.S. distributors should have been recorded in the quarter when the
products were sold to retailers
rather than when they were
shipped to the distributors.
Hain’s board said in November that the company had done
nothing wrong, but the company still missed four deadlines
to report quarterly results, and
in February said it was under
investigation by the Securities
and Exchange Commission.
The accounting controversy
derailed a company that had
been well placed to capitalize
on the fast-growing demand
for organic food. Hain has acquired more than 55 brands,
including Terra vegetable
chips and Earth’s Best baby
food, since it was founded by
Mr. Simon in 1993.
But in recent years, mainstream rivals such as General
Mills Inc. and Kellogg Co.
started acquiring natural and
organic brands and winning
shelf space from Hain. The
company has also pared back
some of its products.
In June, hedge fund Engaged Capital LLC amassed a
9.9% stake. The activist investor said it had nominated
seven candidates to the company’s eight-member board of
directors, and that it could
take further action, such as
pushing for a sale.
B4 | Wednesday, August 30, 2017
THE WALL STREET JOURNAL.
NY
TECHNOLOGY
WSJ.com/Tech
Google Readies Europe Search Changes
make them bid for the space
via an auction mechanism, essentially making money from
the settlement.
Rivals could again file complaints to the EU if they find
Google’s remedies in the shopping case to be insufficient.
Should the commission find
any merit in the complaints, it
could then penalize Google for
not complying.
Google has to comply with
the EU’s order to change its
Plan would address
an order to provide
rivals equal treatment
in shopping results
BY NATALIA DROZDIAK
AND SAM SCHECHNER
Should the offered
remedies fall short,
the EU could issue
additional penalties.
FILIP SINGER/EPA/SHUTTERSTOCK
Alphabet Inc.’s Google has
sketched out to the European
Union’s antitrust authority
how it plans to implement the
regulator’s recent order to
stop illegally tipping the scales
in favor of its own comparison-shopping service, the EU
said Tuesday.
The European Commission,
which has for roughly seven
years been investigating
Google for breaching the bloc’s
antitrust rules in various areas, in June fined Google a record €2.42 billion ($2.9 billion)
for
discriminating
against rival comparison-shopping sites in search rankings.
As part of the decision, the
EU at the time also ordered
Google to overhaul its shopping search results by late
September so that the company treats its competitors’
offerings and its own shopping
service equally. The changes
would have to apply for users
in all European countries
where Google offers its shopping service. Google was due
to notify the EU by Tuesday
about how it plans to implement the decision.
“The commission can confirm that, as required by the
commission decision, it has received information from
Google on how the company
intends to ensure compliance
with the commission decision
by the set deadline,” an EU
spokeswoman said. The EU
A Google booth at a Berlin digital conference this year. The EU’s antitrust authority fined the company in June over search rankings.
didn’t provide more details of
the proposal and Google earlier declined to do so.
The commission has left it
up to Google to decide how to
change its service and doesn’t
have to sign off on the company’s plans. But should the
offered remedies fall short,
the EU could issue additional
penalties of as much as 5% of
average daily global revenue
for each day the regulator
deems Google not to be in
compliance with the decision.
Tuesday’s proposals aren’t
the first time Google has attempted to resolve the EU’s
concerns about how it displays
rivals’ products in its search
results. Since the bloc opened
the case in 2010, Google has
made at least three separate
settlement offers—only to
watch them fall apart because
the EU’s executive arm ruled
them insufficient, often under
political pressure from Germany and France.
Google’s final binding offer
in February 2014, which the
EU made public, would have
changed results pages that
display Google shopping ads
to also include shopping results from rival companies.
Those results would have appeared in a shaded box next to
Google’s shopping ads, according to screenshots the EU published at the time to illustrate
the proposed settlement.
That settlement extended
beyond the shopping case to
include Google specialized results for local search, which
searches for nearby businesses
such as restaurants, and for
travel search, which includes
flights and hotels.
Neither of those two categories of specialized results
would be covered in Google’s
proposals Tuesday. The EU
continues
to
investigate
Google’s behavior with these
and other specialized results
as well as with its Android
mobile-operating service and
AdSense advertising service.
Behind the scenes, rivals
from the German publishing
business, and from U.S. firms
such as Yelp Inc., had lobbied
heavily for the executive arm
to scrap the settlement deal.
The complainants objected
that the placement they would
receive—to the right of
Google’s own results—wasn’t
prominent enough. And they
also complained Google would
behavior regardless of a potential appeal by the company
to the bloc’s higher courts.
Besides an appeal, Google
could file for an injunction, or
so-called interim measures, to
pause the order to change its
behavior, pending the outcome
of the appeal. But the bar for
that relief is high, according to
legal experts, as Google would
have to prove to a judge that
implementing the EU’s order
would cause the company “serious and irreparable harm.”
Nicolas Petit, an antitrust
professor at the University of
Liege, said past EU attempts
to settle with Google could
bolster the company’s case in
court if it chooses to appeal.
“Settlement discussions are
not appropriate for cases
which could end with fines,”
said Mr. Petit, which consequently could have left Google
under the expectation there
would be no fine in the case.
ADVERTISEMENT
The Mart
BUSINESS OPPORTUNITIES
LUKE SHARRETT/BLOOMBERG NEWS
To advertise: 800-366-3975 or WSJ.com/classifieds
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‘Amazon Effect’
Engenders Deals
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A growing number of companies are paying to track in
real time everything from
truckloads of pork chops to
shipping containers full of exercise equipment.
Logistics providers, retailers and suppliers are signing
deals with software companies
that use location data and
weather and traffic information to monitor shipments and
alert customers to events that
could hold up delivery, such as
a loaded truck sitting in a yard
for more than an hour.
This month, supply-chain
software company Descartes
Systems Group bought MacroPoint LLC, which provides
location-based truck tracking,
for $107 million. Descartes already tracks ocean, air and
parcel delivery for customers
such as Home Depot Inc. and
CVS Health Corp., as well as
some trucking. Other so-called
visibility startups are broadening their scope, adding services such as real-time temperature tracking.
The need for these services is
growing as retailers and shoppers demand faster, more precise delivery. Many Amazon.com Inc. customers have
become accustomed to reliable
two-day shipping, forcing other
retailers to offer similar service.
Businesses are making new demands of their suppliers as they
trim inventories and reduce
supply-chain costs. Wal-Mart
Stores Inc. in July said it would
penalize companies that made
deliveries too late or too early.
“It’s the Amazon effect—
customers are putting more
pressure on their supplier to
know where their product is,”
said Bart De Muynck, a supply
chain analyst with Gartner Inc.
Mr. De Muynck said he expects
more tracking startups to get
snapped up by larger software
companies.
Pork producer Smithfield
Foods Inc. hires more than
230 trucking companies to
ship about 1,000 truckloads of
product in the U.S. a day.
“Managing that is an awful
lot of phone calls,” said Dennis
Organ, Smithfield’s senior vice
president of supply chain.
Smithfield’s on-time delivery rate improved to 94%,
from 87%, after it began tracking truck freight with software
from FourKites Inc. Smithfield
plans to test its use for ocean
freight, Mr. Organ said, and is
incorporating a new temperature-tracking feature introduced in June.
Some businesses are using
delivery speed as a way to
compete on service. “We
have a customer in Australia
selling sand for a premium
price because they can do
time-definite, same-day delivery, with a one- or twohour window,” said Chris
Jones, executive vice president of marketing and services for Descartes.
On Tuesday, logistics-software company Convey, which
specializes in last-mile delivery
tracking, said it raised $8.25 million in a Series B funding round
led by Techstars Venture Capital
Fund. The firm, whose platforms
are largely used by retail clients
such as Wal-Mart’s Jet.com,
plans to focus on international
supply chains and expand into
additional markets, such as
medical devices and construction and building materials.
Ingram Micro Inc.’s e-commerce fulfillment unit has been
using Convey’s software since
February to monitor clients’
shipments of apparel, electronics and other items from China
to consumers’ doorsteps.
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | B5
NY
MANAGEMENT
Corporate World Recruits Generals
Their leadership skills are seen as suited to the ‘fog of business’; the Battle of Gettysburg as a teaching tool
At companies across
America, generals are bringing battlefield lessons to
business.
Software maker Red Hat
Inc. and computer-security
firm Symantec Corp. are
among the employers turning to generals for help on
numerous fronts, from corporate governance to grappling with cyberwarfare. At
not-for-profit Florida Hospital, a retired general is developing global partnerships
and leadership talent, while
Finland’s Cargotec Oyj has
one running its rough-terrain-equipment unit in
Texas.
Military brass have gained
clout in the White House,
too. Often referring to them
as “my generals,” the president has tapped a trio of
leaders to impose order and
shape his national-security
policy. Retired Marine Corps
Gen. John Kelly swiftly
brought a forceful management style to his job as the
president’s new chief of
staff, staffers say, while both
Republicans and Democrats
see Defense Secretary Jim
Mattis, also a retired Marine
Corps general, and national
security adviser H.R. McMaster, an Army lieutenant general, as calming forces in a
turbulent presidency.
Discipline, though, is only
one of the traits companies
say military leaders bring to
boards and management
teams.
In the fog of war, and in
peacetime, generals are
trained to anticipate unknown risks, build high-functioning teams and make
quick, strategic decisions in
high-pressure situations.
“They are the same traits
necessary in the fog of business,” says Henry Stoever, a
captain in the Marine Corps
who is now chief marketing
officer of the National Association of Corporate Directors.
The group has put some
500 retired generals and admirals through a three-day
course to prepare them for
WORKAROUNDS
A Nudge Can Help
Workers Save More
There is new evidence that
employers can help persuade
even their most stubborn employees to save more for retirement.
When the state of North Carolina’s retirement division sent
email “nudges” to older public
employees taking part in its supplemental savings plans, those
workers were more likely to reassess their savings strategies or
increase their contributions, according to the findings of a working paper by the National Bureau
of Economic Research.
The results suggest employers
can have an impact on employee
retirement beyond simply offering
savings plans such as 401(k)s
and 457s.
Even though companies leave
retirement-savings plans to outside vendors like Prudential Financial Inc. and the Vanguard
Group, it is important for employers to encourage workers to periodically reassess their retirement
JULIA ROBINSON FOR THE WALL STREET JOURNAL
BY VANESSA FUHRMANS
Stephen Speakes addressed staff this month. The retired Army general heads a Texas unit of cargo-equipment maker Cargotec.
corporate board duty; half of
them now sit on private and
public boards, including
those of Wells Fargo & Co.,
USA Truck Inc. and aerospace supplier Wesco Aircraft Holdings Inc.
‘The people on the
line will tell you in
a heartbeat what’s
going on and why.’
Companies, especially
those in crisis, covet the reputational boost that comes
from seeking the counsel of
a former military leader,
says Wendy Monsen, president of executive recruiter
Korn/Ferry’s federal-government practice. Whereas
more than three-quarters of
security, says Robert Clark, a professor of economics and management at North Carolina State University and one of the study’s
authors.
“Encouraging workers to be
prepared for retirement is certainly in a company’s interest,”
says Mr. Clark. “An employer obviously wants satisfied workers as
well as satisfied retirees.”
The North Carolina experiment,
conducted in 2014, involved a
sample of 14,710 active workers
50 through 69 years old.
As private employers have
shifted away from traditional pensions, Americans are less prepared for retirement. Financial experts advise individuals to save
eight to 11 times their annual incomes to maintain their standard
of living in retirement, but the average working household has virtually no retirement savings, according to the nonprofit National
Institute on Retirement Security.
The median retirement account balance for all working-age
households in the U.S. is $3,000;
for near-retirement households, it
is $12,000.
—Francesca Fontana
BUSINESS WATCH
NEW YORK TIMES
ABBOTT LABORATORIES
Court Dismisses Suit
Brought by Palin
Pacemakers Gain
Hacking Protection
A federal court on Tuesday
dismissed a defamation lawsuit
brought by Sarah Palin against
New York Times Co., saying the
former Alaska governor failed to
show the newspaper acted maliciously when it made an error in
an editorial about gun violence.
The 2008 Republican vicepresidential nominee filed the
suit after the New York Times
ran an editorial in June that suggested her political-action committee helped incite the 2011 assassination attempt against
former Democratic Rep. Gabrielle
Giffords.
After publication, the Times
corrected the article, noting that
there was no evidence of a link
between Ms. Palin’s activities
and the shooting.
—Imani Moise
Abbott Laboratories released
new software updates designed
to protect hundreds of thousands of implanted pacemakers
from external hacking that could
harm heart patients, and to
guard against dangerous battery
depletions in a different cardiac
device linked to two patient
deaths.
U.S. health regulators flagged
the safety risks of the devices
and issued a blistering warning
letter earlier this year criticizing
Abbott’s handling of the problems.
Abbott acquired the products
with its $23.6 billion purchase of
St. Jude Medical in January and
said the issues cited in the
warning letter occurred before
the deal closed.
—Peter Loftus
Americans trust the military
to act in the public’s interest, according to a 2016 Pew
Research Center survey, only
41% feel the same way about
business leaders.
For companies seeking cybersecurity skills or geopolitical know-how, “general officers end up on our short
list quite a bit for industry
clients,” says Ms. Monsen.
However, outside the defense industry, military brass
remain rare in c-suites and
boardrooms. The number of
top executives who once
served has shrunk over the
decades as Vietnam War-era
veterans have retired.
Among S&P 500 firms, only
13 are led by former service
members, and just under 5%
of their combined board
members are veterans, according to S&P Global Market Intelligence data.
Rather than barking or-
ders and enforcing hierarchy,
military leaders who succeed
in the corporate world know
how to coax different groups
into collaborating, says retired Army Maj. Gen. Michael
J. Diamond, an organizational leadership consultant.
Before her retirement in
2013, Maj. Gen. Suzanne Vautrinot led the U.S. Air Force’s
cyber operations. She has
parlayed that expertise into
board seats at companies
such as Wells Fargo and water treatment- and cleaningproducts maker Ecolab Inc.
Like many senior officers
in the private sector, Gen.
Vautrinot urges others not to
use her Air Force title, and
instead call her “Zan.” Ecolab Chief Executive Doug
Baker says her disarming
style lets her push her points
without ruffling feathers.
“Think about that generation
of women generals,” he says.
“You have to have pretty
good [emotional intelligence]
skills, and she does.”
Gen. Vautrinot says she
examines company strategies
much like military leaders
are trained to do: “You’re
looking at the future and
connecting the dots, and
you’re looking at the risks,”
she said. “If the assumptions
that went into the strategy
change, how do you think
about adjusting?” The approach “isn’t unique to me
as a military member,” she
says, “but it is inherent.”
Lt. Gen. Mark Hertling
brought disparate brigades
and regiments into a cohesive force as commander of
the U.S. Army Europe. Similar challenges awaited when
he joined Florida Hospital in
2013. Hired to develop ideaexchanges and other partnerships abroad, he soon after was asked to devise a
leadership course for doctors, in part to improve collaboration with administrators and get physicians more
involved in broader decisions
at the 32,000-employee hospital group.
Gen. Hertling’s course culminates in several dozen
doctors, nurses and administrators going to Gettysburg,
Pa., each year. There, he assigns each to be a different
figure in the pivotal Civil
War battle; afterward the
staff discuss how the lessons
apply to health care. “They
really dig into that person’s
personality and see how
their achievements or dysfunctions contributed to the
bigger disaster or accomplishment,” he says.
Generals learn lessons,
too. After retiring from the
Army seven years ago, Lt.
Gen. Stephen Speakes developed enterprise strategy at
financial-services firm USAA
for three years before he was
let go. In hindsight, he says
he failed to grasp the need
to build consensus around
his decisions and didn’t recognize when colleagues
weren’t on board.
“In my old days, I was a
decision-making machine. It
was a quick look around the
room and if no one had objections, it was go,” he says.
“In the corporate world,
once you make a decision,
you have to continue to sell
its execution.”
Now rounding his fourth
year as CEO of Kalmar
Rough Terrain Center LLC, a
Texas unit of cargo-equipment maker Cargotec, Gen.
Speakes says he has learned
to encourage staff input and
allow time for them to get
behind ideas.
He keeps up other practices honed during his 35year military career, such as
making sure he knows the
situation on the ground, frequently holding company
meetings on the plant floor.
“When manufacturing companies get too big, the leaders leave the manufacturing
floor,” he says. But “the people on the line will tell you
in a heartbeat what’s going
on and why.”
ADVERTISEMENT
Career Opportunities
To advertise: 800-366-3975 or WSJ.com/classifieds
CAREERS
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© 201 Dow Jones & Company, Inc.
All Rights Reserved.
CAREERS
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B6 | Wednesday, August 30, 2017
THE WALL STREET JOURNAL.
NY / NE
THE PROPERTY REPORT
Retail Pain Cuts
Property-Tax Take
MICHAEL BUCHER/THE WALL STREET JOURNAL
BY ESTHER FUNG
A battle among equity investors in the Steinway building in Manhattan, a condominium project, has spilled into court.
Investors Circle for Deals
BY PETER GRANT
Investors are raising funds
to take advantage of busted
condominium projects and
other distressed property as
weak sales and falling cash
flow in parts of the U.S. commercial real-estate industry
show signs of spreading.
Firms that are either raising money or are planning to
start soliciting funds targeting
commercial-property woes include Madison Realty Capital,
Delshah Capital LLC and a
venture of investor Michael
Ashner and New York developer Steven Witkoff.
Most big private-equity
firms, like Blackstone Group
LP and KKR & Co., aren’t raising funds specifically for distressed situations. But they
have money available to take
advantage of condo developments falling short of sales
projections, shopping centers
struggling with competition
from online retail, delinquent
debt and other problems sur-
facing in several markets.
To be sure, no one expects
the kind of carnage that commercial property suffered during the last downturn, which
cost investors billions. Many
property types—like downtown office buildings and distribution centers—continue to
enjoy rent growth and have
access to ample financing at
low interest rates.
But some analysts point out
that commercial property typically runs in cycles, and it is in
one of the longest-running
bull markets in recent memory. Lately, the pace of sales
volume has slowed, which often is a sign that the market is
at or near its top.
“There’s a drop coming just
like when you get to the top of
a roller coaster,” said Michael
Shah, chief executive of
Delshah Capital, which is planning to raise a $200 million
fund to focus on distressed
opportunities.
At the same time, values
have started falling for some
property types, like shopping
centers, suburban office buildings and hotels in some markets. These values are measured in terms of yields—or
capitalization,
or
“cap,”
rates—which rise as prices
fall. According to a recent survey by CBRE Group Inc., the
property type that suffered
the greatest decline in value
from the second half of 2016
to the first half of 2017 were
retail “power centers,” where
typically two or three big-box
stores are surrounded by
other retail and parking. Their
average cap rate rose to 7.31%
the first half of this year, compared with 6.92% six months
earlier.
The rate of owners falling
behind on loan payments also
has increased this year. In
July, a Moody’s Investors Service delinquency tracker of a
popular type of commercial
mortgage-backed security was
at 6.7%, compared with 6% at
the end of 2016. That is well
below the peak of 10.1% the
tracker hit in July 2012. But
the current number is much
higher than the tracker was at
in 2008: 0.5%.
Executives at firms raising
distressed funds say the market offers different opportunities than previous cycles because of the large number of
nontraditional lenders—like
mortgage real-estate investment trusts and private-equity
firms—that have been active
in recent years.
Apollo Commercial Real Estate Finance Inc., a mortgage
real-estate investment trust,
provided a $325 million mezzanine, or junior, loan behind
a $400 million construction
loan for a condominium project on 57th Street in Manhattan known as the Steinway
building. Since then, a battle
among equity investors has
spilled into court.
Apollo this year sold at par
a $25 million junior piece of
its loan to another investor,
said Stuart Rothstein, chief executive of Apollo Commercial.
In April, the Indiana Supreme Court handed Kohl’s
Corp. a victory when it agreed
not to review a lowered property assessment that was
awarded to one of the retailer’s
stores because of the rising vacancy rates and dropping values of other shopping centers
in its area.
The decision, which translated into a $219,000 refund for
Kohl’s, was a sign of the drain
to tax revenue resulting from
the worsening retail real-estate
landscape for Howard County,
the taxing jurisdiction, as well
as other local governments
throughout the country.
Retail sales and occupancy
rates are falling in many parts
of the U.S., partly because of
oversupply of stores and competition with online retailers.
That has meant lower property
values, lower tax collections
and—in some cases—less to
pay teachers and firefighters.
But property owners and retailers say lower tax bills,
which are a large part of operating costs, will help to keep
them in business. “This is one
of the ways to lower operating
costs, and the new owner
would then be able to negotiate
better deals with tenants and
keep them in the mall,” said
Thomas Dobrowski, executive
managing director of capital
markets at real-estate-services
firm Newmark Knight Frank.
National statistics aren’t
available on reduced tax assessments and refunds for retail landlords. But the sector
clearly is suffering reduced
property values as landlords
face more pressure these days
from department stores and
other tenants downsizing or
filing for bankruptcy protection. Property-services firm
Cushman & Wakefield estimates that the number of store
closures this year will reach at
least 8,000. That would be up
from more than 4,000 in 2016.
More retail landlords are defaulting on securitized loans
than owners of other property
types. In the first seven months
of 2017, the loan balances of
these defaulted mortgages increased roughly 20% to $1.34
billion, according to data from
Trepp Inc.
Buyers of struggling malls
that pay low prices often
quickly pursue a reassessment
of the property to lower the tax
bill. Assessors say more store
owners and mall landlords are
lodging appeals for a lower assessed valuation for their shopping centers and malls.
Property-tax bills are some
shopping-center owners’ biggest expense, outpacing salaries and rents.
Some landlords appealing
assessments point to the declining amount of sales taxes
being generated by their
stores. Others cite market conditions in the region, such as
sales prices of vacated stores.
In the Kohl’s case, the retailer challenged the Howard
County assessor’s valuation for
2010 to 2012. The retailer’s appraiser looked at sales of what
the appraiser said were comparable retail property in the
Midwest, including former
Wal-Mart and Kmart stores.
These properties were sold
for prices ranging from $5.13 to
$63.65 a square foot. Howard
County Assessor Mindy Heady
hired another appraiser who
opined that only one property
that sold at $63.65 a square
foot was comparable. The others were in markets with
smaller demographics.
Kohl’s didn’t respond to requests for comment.
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THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | B7
THE PROPERTY REPORT
In Houston, the Fallout Begins
BY ESTHER FUNG
ers would incur more losses,
he said.
Sandy incurred $19 billion
in damage and economic loss,
according to an analysis by a
recovery initiative convened
by New York City. The total
damage from Hurricane Katrina in 2005 reached $108 billion, according to the Federal
Emergency
Management
Agency.
The Houston region should
be able to recover more
quickly than Louisiana did
from Katrina because it is
above sea level and should be
able to drain more quickly, Mr.
Wheeler said.
Houston’s office market was
hurting before Harvey because
of problems in the energy sector, a big employer in the region. Office vacancy rates in
the second quarter reached
18.8%, the highest rate since
1994, according to data from
real-estate-services firm Colliers International.
The devastation in the area
DAVID J. PHILLIP/ASSOCIATED PRESS
Houston’s office and retail
real-estate markets are likely
to get hurt by lost business in
the weeks and months immediately following Hurricane
Harvey.
But some commercial-property types may actually benefit in Harvey’s aftermath. After
past major natural disasters,
like superstorm Sandy in 2012,
demand increased for selfstorage and hotel rooms as
New York and New Jersey
dried out and rebuilt.
That is the initial conclusion of real-estate industry executives and analysts predicting the long-term impact of
Harvey.
The full impact of the Category 4 storm, which hit the
Texas coast on Friday, likely
won’t be known for months.
First responders on Tuesday
were still evacuating victims
from flooded areas as the record rainfall continued.
Still commercial-property
owners, lenders and analysts
already have begun to assess
damage and analyze the impact on landlords and their
lenders. Most are covered by
property and business-interruption insurance, but that
doesn’t mean they have nothing to worry about.
Roughly 2,900 commercial
properties with about $29.6
billion of debt that was sold as
commercial mortgage-backed
securities was in the storm
area, according to an analysis
of 54 Harvey-hit counties by
data firm Trepp Inc. Banks, insurance companies and other
lenders also hold billions of
dollars of debt backed by real
estate in the affected region.
Business-interruption insurance policies typically have indemnity periods between 12
and 24 months, said Darrell
Wheeler, Standard & Poor’s
global head of structured-finance research. If disruptions
aren’t rectified by then, own-
The debris from a family business in Katy, Texas. Some commercial properties like hotels and selfstorage facilities may benefit in Harvey’s aftermath, real-estate analysts and executives say.
could amplify the problems for
office landlords who are facing
big lease expirations soon,
Manus Clancy, senior managing director at Trepp, said in
an email. “An extended inability to show, renovate or release those offices could be
impactful.”
The storm and its aftermath
may also prove to be painful
for retail landlords because of
a decline in shopping as stores
remained closed due to flooding or the lack of electricity.
“The disruption in the area
is likely to last two to three
months,” said David Marcotte,
senior vice president at consulting firm Kantar Retail,
adding that stores might
spend two to three weeks
without power. He said there
would also be pent-up demand
for goods afterward as people
fix their homes and replenish
their refrigerators.
In the aftermath of Sandy,
numerous large retailers—including Target Corp., Nordstrom Inc. and Gap Inc.—fell
short of projections partly because of the storm.
On Tuesday, shares of
Whitestone REIT, which owns
15 retail centers in the Houston area, fell 0.3% after dropping 4.9% on Monday.
Whitestone REIT said preliminary reports showed that
Harvey caused only minor
damage to the company’s community-center properties in
Houston, Austin and San Antonio, and all of its properties in
the region are operational.
Harvey’s impact on hotel
owners could be mixed. Analysts say many business and
leisure travelers will steer
clear of the region in the short
term. But hotels may also see
an increase in business from
displaced residents.
“We are seeing additional
demand throughout the state,
but there is still availability in
most markets,” said Scott
Joslove, chief executive of the
Texas Hotel & Lodging Association in an email.
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A Platform as Powerful as the People Who Use It.
To Advertise Your Commercial Property call 1-800-366-3975
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NY / NE
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THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | B9
MARKETS DIGEST
EQUITIES
S&P 500 Index
Dow Jones Industrial Average
Last Year ago
21865.37 s 56.97, or 0.26%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio 20.07 20.01
P/E estimate *
18.38 17.98
Dividend yield
2.30
2.47
All-time high 22118.42, 08/07/17
Nasdaq Composite Index
Last
2446.30 s 2.06, or 0.08%
High, low, open and close for each
trading day of the past three months.
Year ago
Trailing P/E ratio 23.53 24.71
P/E estimate *
18.73 18.59
Dividend yield
2.01
2.11
All-time high: 2480.91, 08/07/17
Last Year ago
6301.89 s 18.87, or 0.30%
High, low, open and close for each
trading day of the past three months.
Trailing P/E ratio * 24.94
23.85
P/E estimate *
21.19
20.09
Dividend yield
1.13
1.22
All-time high: 6422.75, 07/26/17
Current divisor 0.14602128057775
22400
2500
6500
22000
2475
6400
21600
2450
6300
21200
2425
6200
20800
2400
Session high
t
DOWN
Session open
65-day moving average
t
Close
UP
Close
Open
65-day moving average
20400
6000
2375
July
May
Aug.
5900
2350
20000
June
6100
Session low
Bars measure the point change from session's open
May
65-day moving average
June
July
May
Aug.
June
July
Aug.
Weekly P/E data based on as-reported earnings from Birinyi Associates Inc.
Major U.S. Stock-Market Indexes
High
Latest
Close
Low
Net chg
% chg
21879.22 21673.58 21865.37
Transportation Avg
Utility Average
Total Stock Market
Barron's 400
9086.38
9237.18
80.22
750.32
746.15
746.47
-1.69
25297.28 25083.45 25268.17
635.20
630.22
634.50
17.17
-0.75
Nasdaq Stock Market
Nasdaq Composite
6311.26
Nasdaq 100
5871.79
6228.73
5785.22
6301.89
5862.14
0.88
-0.23
0.07
-0.12
0.30
18.87
24.06
Standard & Poor's
500 Index
2449.19
2428.20
2446.30
2.06
MidCap 400
SmallCap 600
1708.55
829.11
1695.87
821.78
1706.68
828.26
-1.31
0.12
Other Indexes
Russell 2000
1385.19
1371.80
1383.68
1.45
0.41
18.5
10.6
8.5
7755.40
16.8
2.1
3.2
Most-active issues in late trading
748.16
625.44
12.2
13.2
9.8
25692.25 21514.15
661.93
521.59
12.2
14.3
8.6
5.5
6.5
5.5
52-Week
Low
% chg
YTD
% chg
3-yr. ann.
-8.34
-0.07
509.79
505.93
509.50
-0.10
-0.02
NYSE Arca Biotech
4061.83
3961.79
4046.30
46.86
NYSE Arca Pharma
11801.41 11728.98 11791.88
NYSE Composite
Value Line
523.34
519.16
522.76
0.01
KBW Bank
93.22
92.16
-0.70
PHLX§ Gold/Silver
92.98
90.92
88.38
0.20
PHLX§ Oil Service
89.38
121.26
119.09
121.16
0.69
1087.32
14.34
1070.08
11.48
1084.86
11.70
2.24
0.38
PHLX§ Semiconductor
CBOE Volatility
5046.37
4660.46
20.7
22.7
17.1
20.5
11.2
12.8
2085.18
12.4
9.3
6.9
0.01
1791.93
876.06
1476.68
703.64
8.7
9.5
2.8
-1.2
5.9
7.2
0.11
1450.39
1156.89
11.0
2.0
5.6
12000.02 10289.35
1.17
0.002
-0.75
0.22
0.57
Volume
(000)
Last
iShares MSCI Emg Markets EEM
7,460.5
44.71
VanEck Vectors Gold Miner GDX
4,070.7
SPDR S&P 500
SPY
Bank of America
BAC
2,471.5
23.64
0.06
0.25
23.68
23.50
Regions Financial
RF
2,424.6
14.16
…
unch.
14.16
14.12
WPX Energy
WPX
1,851.3
9.73
-0.01
-0.10
9.74
9.72
Annaly Capital Mgmnt NLY
1,537.9
12.36
0.01
0.08
12.36
12.35
Twitter
1,453.3
16.93
…
unch.
16.95
16.93
Intra-Cellular Therapies ITCI
32.9
18.20
2.30
14.47
18.63
15.79
Sonic Automotive Cl A SAH
12.9
18.70
2.20
13.33
18.70
16.44
AeroVironment
AVAV
64.1
43.15
3.80
9.66
43.15
39.08
Vitamin Shoppe
VSI
7.8
5.25
0.25
5.00
5.50
5.00
Chico's FAS
CHS
54.9
8.20
0.37
4.73
8.25
7.82
Company
Symbol
TWTR
Close
Net chg
–3.37
–0.39
–0.68
DJ Americas
589.32
Sao Paulo Bovespa 71329.85
S&P/TSX Comp
15082.70
S&P/BMV IPC
51313.66
Santiago IPSA
3922.20
0.32
313.26
30.67
46.94
–6.26
368.42
367.99
3846.60
5031.92
11945.88
1381.61
21408.62
510.03
1067.58
10192.60
545.83
8814.54
7337.43
EMEA
Eurozone
Belgium
France
Germany
Israel
Italy
Netherlands
Russia
Spain
Sweden
Switzerland
U.K.
Stoxx Europe 600
Euro Stoxx
Bel-20
CAC 40
DAX
Tel Aviv
FTSE MIB
AEX
RTS Index
IBEX 35
SX All Share
Swiss Market
FTSE 100
Asia-Pacific
Australia
China
Hong Kong
India
Japan
Singapore
South Korea
Taiwan
S&P/ASX 200
5669.00
Shanghai Composite 3365.23
Hang Seng
27765.01
S&P BSE Sensex
31388.39
Nikkei Stock Avg
19362.55
Straits Times
3249.34
Kospi
2364.74
Weighted
10496.57
44.72
44.33
24.48
0.06
0.25
24.48
24.38
3,241.2 244.89
0.04
0.02 245.08 244.23
Percentage gainers…
9.2
6.6
2.2
455.65
5.1
0.7
0.4
4075.95
2834.14
23.9
31.6
8.9
549.20
463.78
0.1
8.6
-0.1
99.33
69.71
28.3
1.3
9.2
H&R Block
HRB
311.8
28.02
-1.21
-4.14
29.55
27.26
101.55
73.03
-2.7
13.3
-4.4
ScanSource
SCSC
10.7
37.55
-1.45
-3.72
39.10
37.25
192.66
117.79
-23.9
-34.1 -25.7
Barnes Noble Education BNED
16.8
6.60
-0.22
-3.23
6.84
6.60
19.7
-16.7
Quorum Health
QHC
10.8
4.31
-0.14
-3.22
4.45
4.31
Ollie's Bargain Outlet
OLLI
81.2
42.05
-1.25
-2.89
44.50
41.50
1138.25
22.51
3.36
768.37 35.3
9.36 -10.8
18.9
-0.8
...And losers
–3.87
–4.11
–37.95
–47.83
–177.59
–10.81
–317.59
–4.73
–1.17
–93.30
–5.72
–49.69
–64.03
Latest
% chg
YTD
% chg
11.8
12.6
16.4
–0.12
–0.11
–0.27
0.05
0.44
0.20
0.09
–0.16
9.1
18.4
–1.3
12.4
21.7
1.9
5.1
6.7
3.5
4.0
–6.1
11.3
5.6
–7.4
9.0
2.1
7.2
2.7
–1.04
–1.10
–0.98
–0.94
–1.46
–0.78
–1.46
–0.92
–0.11
–0.91
–1.04
–0.56
–0.87
0.1
8.4
26.2
17.9
1.3
12.8
16.7
13.4
–40.90 –0.72
0.08
2.57
–0.35
–98.28
–362.43 –1.14
–87.35 –0.45
–18.28 –0.56
–0.23
–5.56
–0.28
–29.41
Company
Symbol
Achieve Life Sciences
Fusion Telecomm Intl
Ovid Therapeutics
Juno Therapeutics
Movado Group
ACHV
Abeona Therapeutics
Opiant Pharmaceuticals
Immunogen
BIO-key International
Veritone
ABEO
Fate Therapeutics
Catalent
Atwood Oceanics
ARC Group Worldwide
Aeglea BioTherapeutics
FATE
FSNN
OVID
JUNO
MOV
OPNT
IMGN
BKYI
VERI
CTLT
ATW
ARCW
AGLE
High
52-Week
Low
% chg
Symbol
Uni-Pixel
Bank of America
VanEck Vectors Gold Miner
SPDR S&P 500
iPath S&P 500 VIX ST Fut
UNXL
Finl Select Sector SPDR
ENSCO PLC
Delcath Systems
iShares MSCI Emg Markets
ProSharesUltVIXST
XLF
GDX
SPY
VXX
37.69
26.20
21.48
20.09
19.50
10.18 2.45
2.91 0.96
15.93 5.28
44.60 17.52
31.95 20.50
-41.1
66.1
...
38.9
25.2
Acorda Therapeutics
Finish Line Cl A
Power REIT
J.Jill
Kona Grill
ACOR
11.25
27.65
7.58
3.20
15.04
1.75
4.17
1.12
0.40
1.85
18.42
17.76
17.34
14.29
14.03
11.60
...
8.04
3.67
15.64
3.90
...
1.51
1.44
7.76
174.4
...
163.2
6.7
...
root9B Holdings
AVEO Pharmaceuticals
Interlink Electronics
Best Buy
Papa Murphy's Holdings
RTNB
3.67
40.27
7.17
2.50
3.72
0.45
4.91
0.87
0.30
0.42
13.98
13.89
13.81
13.64
12.72
5.68 1.80
41.37 21.83
15.37 5.91
5.95 2.00
10.34 2.81
38.0
60.6
-12.3
-1.2
-35.8
CGG ADR
Helen of Troy
Pfenex
Conn's
DHI Group
CGG
DCTH
EEM
UVXY
Volume % chg from Latest Session
(000) 65-day avg Close % chg
0.13 105.57
23.58 -0.59
24.42 0.66
244.85 0.11
47.87 1.21
6013.6
-17.1
11.6
-25.2
115.7
-32.3 24.57 -0.32
96.3 4.60 5.02
-63.7 0.12 -6.98
-22.5 44.69 -0.18
98.7 31.19 2.60
52-Week
High
Low
A consumer rate against its
benchmark over the past year
Five-year ARM, Rate
4.00%
3.00
t
0.00
Standard Bank, PaSB
Murrysville, PA
2.75%
724-327-0010
Foxboro Federal Savings
Foxboro, MA
2.88%
877-369-3331
Schools First FCU
Santa Ana, CA
2.88%
800-462-8328
AmericanUnitedMortgageCorporation
3.00%
Scotch Plains, NJ
908-322-5535
Tuesday
t
1.00
Third Federal Savings and Loan
2.59%
Cleveland, OH
866-627-1785
1
3 6
month(s)
One year ago
1 2 3 5 710
years
maturity
Interest rate
Federal-funds rate target
1.00-1.25 1.00-1.25
Prime rate*
4.25
4.25
Libor, 3-month
1.32
1.32
Money market, annual yield
0.29
0.29
Five-year CD, annual yield
1.46
1.47
30-year mortgage, fixed†
3.86
3.82
15-year mortgage, fixed†
3.09
3.06
Jumbo mortgages, $424,100-plus† 4.33
4.29
Five-year adj mortgage (ARM)† 3.31
3.30
New-car loan, 48-month
2.87
2.90
HELOC, $30,000
5.01
4.65
3-yr chg
52-Week Range (%)
Low 0 2 4 6 8 High (pct pts)
0.25 l
l
3.50
0.83 l
0.24 l
1.17 l
l
3.44
l
2.70
l
4.09
l
3.10
l
2.85
l
4.57
1.25
4.25
1.32
0.36
1.47
4.33
3.50
4.88
4.03
3.36
5.22
1.00
1.00
1.08
-0.10
0.12
-0.33
-0.20
-0.18
-0.25
-0.31
0.16
Bankrate.com rates based on survey of over 4,800 online banks. *Base rate posted by 70% of the nation's largest
banks.† Excludes closing costs.
Sources: SIX Financial Information; WSJ Market Data Group; Bankrate.com
HELE
PFNX
CONN
DHX
0
–5
0.75
–10
0.00
–15
30
WSJ
.COM
-0.32
-0.47
-0.97
-7.45
-0.59
-12.26
-12.24
-12.15
-11.93
-9.85
12.75 0.41
4.24 0.50
10.88 6.75
63.32 36.51
6.88 3.50
-76.9
253.9
-35.1
41.4
-9.7
5.46
88.60
3.35
17.70
1.85
-0.57
-8.25
-0.29
-1.50
-0.15
-9.45
-8.52
-7.97
-7.81
-7.50
29.70 3.26
102.88 77.50
11.35 3.16
23.75 6.56
8.43 1.75
-77.3
-2.8
-55.0
166.6
-75.9
Ranked by change from 65-day average*
Symbol
Volume % chg from Latest Session
(000) 65-day avg Close % chg
14.40
23.25
31.95
29.45
63.32
9.55
19.95
20.50
27.24
36.51
JILL
PST
MOV
TBX
BBY
Currencies
U.S.-dollar foreign-exchange rates in late New York trading
WSJ Dollar index
Euro
Yen
Country/currency
US$vs,
YTDchg
Tues
in US$ per US$ (%)
Americas
Argentina peso
.0575 17.3835 9.5
Brazil real
.3160 3.1645 –2.8
Canada dollar
.7992 1.2513 –6.9
Chile peso
.001598 625.80 –6.6
Colombia peso
.0003406 2935.85 –2.2
Ecuador US dollar
1
1 unch
Mexico peso
.0560 17.8421 –14.0
Peru new sol
.3087 3.240 –3.4
Uruguay peso
.03489 28.6600 –2.4
Venezuela b. fuerte .098784 10.1231 1.3
Asia-Pacific
2016
52-Week
High
Low
9.88 -15.77
20.77 -0.48
28.50 19.50
27.79 -0.36
55.02 -11.93
2017
Yield (%)
Last Week ago
52-Week
High
Low
Total Return (%)
52-wk
3-yr
1.883
1.936
2.237
1.314 –1.853 2.541
2.134
2.912
2.430
5.202
2.740
1.752
2.215
2.967
2.480
5.225
2.780
1.780
2.609
3.390
2.790
6.448
3.120
2.516
1.539
2.497
1.920
4.948
2.000
1.358
1.683
1.148
0.338
7.525
0.689
0.868
799.984
5.416
5.476
6.290
5.134
3.844 5.038
2.573
3.769
2.603
3.338
2.424
2.898
Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch
Australian dollar
.7951 1.2577
China yuan
.1516 6.5981
Hong Kong dollar
.1278 7.8250
India rupee
.01562 64.014
Indonesia rupiah .0000749 13359
Japan yen
.009111 109.75
Kazakhstan tenge .002982 335.35
Macau pataca
.1244 8.0394
Malaysia ringgit
.2344 4.2666
New Zealand dollar
.7254 1.3785
Pakistan rupee
.00950 105.225
Philippines peso
.0196 51.080
Singapore dollar
.7380 1.3551
South Korea won .0008893 1124.49
Sri Lanka rupee
.0065428 152.84
Taiwan dollar
.03312 30.196
Track the Markets
Compare the performance of selected global stock
indexes, bond ETFs, currencies and commodities at
WSJ.com/TrackTheMarkets
–9.4
–5.0
0.9
–5.8
–1.2
–6.2
0.5
1.6
–4.9
–4.5
0.8
3.0
–6.4
–6.9
3.0
–7.0
US$vs,
YTDchg
Tues
in US$ per US$ (%)
Country/currency
.03013 33.190 –7.3
.00004398 22738 –0.1
Thailand baht
Vietnam dong
Europe
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
.04585 21.809 –15.1
.1609 6.2142 –12.1
1.1974 .8352 –12.1
.003916 255.36 –13.2
.009524 105.00 –7.0
.1290 7.7501 –10.3
.2814 3.5539 –15.1
.01702 58.760 –4.1
.1260 7.9389 –12.8
1.0462 .9558 –6.2
.2901 3.4465 –2.2
.0393 25.4560 –6.0
1.2919 .7741 –4.4
Middle East/Africa
Bahrain dinar
Egypt pound
Israel shekel
Kuwait dinar
Oman sul rial
Qatar rial
Saudi Arabia riyal
South Africa rand
2.6531 .3769 –0.1
.0566 17.6700 –2.6
.2799 3.5728 –7.2
3.3204 .3012 –1.5
2.5976 .3850 unch
.2704 3.698 1.6
.2666 3.7503 –0.01
.0770 12.9843 –5.2
Close Net Chg % Chg YTD%Chg
WSJ Dollar Index 85.56
0.13 0.15 –7.94
Sources: Tullett Prebon, WSJ Market Data Group
Commodities
COMMODITIES
Tuesday
52-Week
Pricing trends on someClose
raw materials,
or commodities
Net chg % Chg
High
Low
DJ Commodity
Get real-time U.S. stock quotes and track most-active
stocks, new highs/lows and mutual funds. Plus,
deeper money-flows data and email delivery of key
stock-market data. Available free at WSJMarkets.com
2.29
3.37
7.01
55.02
5.40
* Common stocks priced at $5 a share or more with an average volume over 65 trading days of at least
5,000 shares =Has traded fewer than 65 days
5
1.50
Company
-20.7
-64.6
-7.1
...
-77.7
936
897
876
854
807
1474.465
EMBI Global, J.P. Morgan
FRSH
33.00 13.60
24.52 6.90
9.46 6.04
14.40 9.55
14.44 1.50
3,732
175
1,174
66
34,803
10-yr Treasury, Ryan ALM 1760.078
DJ Corporate
378.798
Aggregate, Barclays Capital 1945.780
High Yield 100, Merrill Lynch 2832.033
Fixed-Rate MBS, Barclays 1988.830
Muni Master, Merrill
523.186
Treasury, Ryan ALM
BBY
-24.32
-18.43
-17.55
-15.77
-14.71
J.Jill
Lehman 7-10 Year Treas
Movado Group
ProShares Sh 7-10 Yr Tr
Best Buy
18.94
4.10
0.02
33.94
28.20
10%
2.25
Close
LINK
-6.25
-1.92
-1.36
-1.85
-0.50
25.59
12.04
4.31
45.07
522.00
Corporate Borrowing Rates and Yields
Bond total return index
AVEO
19.45
8.50
6.39
9.88
2.90
24.85
6.90
38.38
13.60
42.08
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group
Yield/Rate (%)
Last (l)Week ago
KONA
52-Week
Low
% chg
59.50
24.52
44.10
33.00
44.57
s
2.00
3.00
t
5-year adjustable-
JILL
High
53.05 6.42
8.50 -18.43
43.56 -0.19
19.45 -24.32
44.32 -0.02
Yen, euro vs. dollar; dollar vs.
major U.S. trading partners
3.75%
3.31%
PW
Latest Session
Close Net chg % chg
3015
1554
1220
972
969
Forex Race
notes and bonds
Bankrate.com avg†:
* 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.
15,573
26,113
507
8,560
65
s
Selected rates
NYSE Arca
ABCO
Advisory Board
FINL
Finish Line Cl A
VicSh US EQ Incm Enh Vol CDC
ACOR
Acorda Therapeutics
ProSharesHedgeReplication HDG
s
U.S. consumer rates
Nasdaq
Total volume*1,620,809,921 194,118,532
Adv. volume* 903,328,276 99,865,667
Decl. volume* 688,352,241 92,796,516
Issues traded
3,042
1,288
Advances
1,495
582
Declines
1,375
659
Unchanged
172
47
New highs
73
57
New lows
52
20
Closing tick
506
18
Closing Arms†
0.83
0.94
Block trades*
8,178
1,095
1.81
0.05
25.80 14.81
28.70 18.58
248.91 208.38
169.64 43.64
* Volumes of 100,000 shares or more are rounded to the nearest thousand
Benchmark
Yields
Treasury
yield
curve
andtoRates
Yield
maturity of current bills,
Consumer Rates and Returns to Investor
FINL
Volume Movers
41,443
38,615
38,497
38,044
36,811
ESV
Symbol
1.01
0.60
1.54
7.33
4.65
100,668
58,371
49,629
47,761
43,865
BAC
Company
3.69
2.89
8.71
43.81
28.50
Most Active Stocks
Company
Total volume* 680,564,070 9,126,664
Adv. volume* 299,424,225 4,039,017
Decl. volume* 360,047,942 4,991,676
Issues traded
3,088
338
Advances
1,440
181
Declines
1,491
140
Unchanged
157
17
New highs
69
4
New lows
70
6
Closing tick
30
19
Closing Arms†
1.18
1.77
Block trades*
6,015
98
Percentage Losers
Latest Session
Close Net chg % chg
CREDIT MARKETS & CURRENCIES
S ON D J FMAM J J A
2016
2017
Low
0.04
Sources: SIX Financial Information; WSJ Market Data Group
5-year Treasury
note yield
After Hours
% chg
High
0.02
Percentage Gainers...
2830.47
367.01
249.11
The Global Dow
DJ Global Index
DJ Global ex U.S.
(ARM)
Net chg
Sources: SIX Financial Information; WSJ Market Data Group
Region/Country Index
t rate mortgage
NYSE NYSE Amer.
533.62
0.21
International Stock Indexes
Americas
Brazil
Canada
Mexico
Chile
6422.75
5950.73
2480.91
Philadelphia Stock Exchange
World
22118.42 17888.28
0.08
-0.08
Volume, Advancers, Decliners
9742.76
High
0.26
56.97
9246.80
Trading Diary
Most-active and biggest movers among NYSE, NYSE Arca, NYSE Amer.
and Nasdaq issues from 4 p.m. to 6:30 p.m. ET as reported by electronic
trading services, securities dealers and regional exchanges. Minimum
share price of $2 and minimum after-hours volume of 5,000 shares.
Dow Jones
Industrial Average
Late Trading
TR/CC CRB Index
Crude oil, $ per barrel
Natural gas, $/MMBtu
Gold, $ per troy oz.
571.68
1.60
177.53
46.44
2.961
1313.10
-0.48
-0.13
0.036
3.40
0.28
589.81
508.27
-0.27 195.14
54.45
-0.28
3.93
1.23
0.26 1349.40
166.50
42.53
2.56
1127.80
% Chg
10.48
YTD
% chg
0.78
-2.89 -7.78
0.19 -13.55
4.74 -20.49
0.11 14.18
THE WALL STREET JOURNAL.
B10 | Wednesday, August 30, 2017
COMMODITIES
Futures Contracts
Open
Metal & Petroleum Futures
Contract
Open
High hi lo
Low
Settle
Chg
Copper-High (CMX)-25,000 lbs.; $ per lb.
Aug
3.0825
3.0935 s
3.0795
3.0810 0.0160
Dec
3.0925
3.1215 s
3.0765
3.1045 0.0185
Gold (CMX)-100 troy oz.; $ per troy oz.
1318.80 1323.80 s
1314.00 1313.10
3.40
Aug
Oct
1315.60 1328.20 s
1306.90 1315.30
3.50
Dec
1320.50 1331.90 s
1310.60 1318.90
3.60
Feb'18
1324.60 1335.00 s
1315.00 1322.70
3.80
June
1332.20 1342.60 s
1322.90 1329.70
3.60
Dec
1345.00 1352.10 s
1333.20 1340.60
3.70
Palladium (NYM) - 50 troy oz.; $ per troy oz.
Aug
885.00
885.00
885.00
947.45 10.85
Sept
937.80
948.85 s
935.50
945.05 10.85
Dec
934.25
947.00 s
932.90
943.70 11.35
March'18 928.55 939.35
928.55
939.65 11.30
Platinum (NYM)-50 troy oz.; $ per troy oz.
Aug
962.60
965.30
962.60 1000.70 14.20
Oct
992.80 1011.50
991.00 1003.50 14.20
Silver (CMX)-5,000 troy oz.; $ per troy oz.
17.055
17.060
17.055
17.422 –0.009
Aug
Dec
17.610
17.755
17.345
17.516 –0.013
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl.
46.86
46.96
45.76
46.44 –0.13
Oct
Nov
47.23
47.32
46.35
47.00
0.04
Dec
47.55
47.61
46.84
47.45
0.18
Jan'18
47.79
47.93
47.25
47.79
0.27
June
48.35
48.65
48.12
48.57
0.37
Dec
48.68
49.00
48.51
48.93
0.42
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal.
1.6478
1.6850
1.6299
1.6655 .0303
Sept
Oct
1.6381
1.6627
1.6259
1.6540 .0231
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal.
Sept
1.7342
1.8180
1.6964
1.7833 .0710
Oct
1.5950
1.6227
1.5511
1.6019 .0306
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu.
Sept
2.915
2.998
2.900
2.961
.036
Oct
2.959
2.990
2.934
2.983
.022
Nov
3.024
3.058
3.004
3.053
.023
Jan'18
3.261
3.291
3.242
3.287
.018
March
3.219
3.245
3.201
3.242
.015
April
2.907
2.913
2.895
2.910
.004
Contract
High hilo
Low
Settle
Open
interest
Chg
Aug
Sept
Corn (CBT)-5,000 bu.; cents per bu.
t 332.00
333.50
t 347.00
348.75
Oats (CBT)-5,000 bu.; cents per bu.
237.00
237.00
232.25
235.00
Sept
Dec
251.75
252.00
246.25
246.50
Soybeans (CBT)-5,000 bu.; cents per bu.
Sept
934.50
937.25
929.50
930.75
Nov
940.25
943.75
934.50
937.25
Soybean Meal (CBT)-100 tons; $ per ton.
295.10
296.70
294.20
294.60
Sept
Dec
298.80
300.80
298.40
299.20
Soybean Oil (CBT)-60,000 lbs.; cents per lb.
Sept
34.59
34.65
34.15
34.28
Dec
34.95
35.03
34.52
34.65
Rough Rice (CBT)-2,000 cwt.; $ per cwt.
Sept
1230.00 1240.00
1214.00 1228.50
Nov
1265.00 1271.50
1245.00 1260.50
Wheat (CBT)-5,000 bu.; cents per bu.
400.50
404.00
t 394.50
402.75
Sept
Dec
428.00
431.25
t 422.50
429.75
Wheat (KC)-5,000 bu.; cents per bu.
Sept
396.00
397.75
t 391.50
397.25
Dec
424.50
426.75
t 420.00
426.25
Wheat (MPLS)-5,000 bu.; cents per bu.
Sept
643.50
643.50
623.00
637.50
Dec
663.50
663.50
645.25
660.25
Cattle-Feeder (CME)-50,000 lbs.; cents per lb.
Aug
143.000 143.325
142.525 142.600
Oct
146.400 147.500
142.950 143.525
Cattle-Live (CME)-40,000 lbs.; cents per lb.
106.200 106.350
104.975 105.250
Aug
Oct
108.300 108.850
105.750 106.100
Hogs-Lean (CME)-40,000 lbs.; cents per lb.
61.625
61.750
t 59.825
60.225
Oct
Dec
57.475
57.600
t 55.775
56.150
Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft.
Sept
371.60
376.80
370.10
376.30
Nov
359.00
362.80
356.90
361.70
335.50
350.75
Sept
Dec
270
212,556
616
64,032
418,934
28,091
9,457
8,573
4
3,258
31,647
560
1
63,355
70
144,744
535,948
243,739
331,457
166,147
154,587
184,648
17,304
100,039
18,233
131,280
6,518
320,159
138,167
145,916
100,201
115,638
336.00
351.00
–2.50 130,442
–2.25 790,370
–3.50
–5.25
56
4,803
–4.50 20,521
–4.00 382,850
–.90 24,065
–.20 186,716
–.31 20,586
–.31 193,402
–4.50
–4.50
1,713
7,824
2.75 18,764
1.75 260,371
.50 12,549
.75 145,247
–7.25
–4.00
4,865
40,656
.175
–2.875
5,316
16,922
–.950
1,284
–2.275 148,194
–1.400 105,521
–1.425 59,865
–3.80
–5.20
1,793
2,039
Cash Prices | WSJ.com/commodities
Tuesday, August 29, 2017
These prices reflect buying and selling of a variety of actual or “physical” commodities in the marketplace—
separate from the futures price on an exchange, which reflects what the commodity might be worth in future
months.
Tuesday
Tuesday
Coins,wholesale $1,000 face-a
Energy
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
0.7755
0.9229
2.880
2.900
1.880
2.470
2.740
1.570
2.750
52.600
11.550
Other metals
LBMA Platinum Price PM
*Closed
Platinum,Engelhard industrial
1004.0
Platinum,Engelhard fabricated
1104.0
Palladium,Engelhard industrial
945.0
Palladium,Engelhard fabricated
1045.0
Aluminum, LME, $ per metric ton
*Closed
Copper,Comex spot
3.0810
Iron Ore, 62% Fe CFR China-s
76.1
Shredded Scrap, US Midwest-s,w
316
Steel, HRC USA, FOB Midwest Mill-s
626
Fibers and Textiles
Metals
Gold, per troy oz
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
1327.90
1427.49
1318.65
1463.70
*Closed
*Closed
1366.04
1379.18
1379.18
1591.69
1290.49
1379.18
Silver, troy oz.
Engelhard industrial
Engelhard fabricated
Handy & Harman base
Handy & Harman fabricated
LBMA spot price
(U.S.$ equivalent)
17.6800
21.2160
17.5600
21.9500
£13.5897
17.6000
13161
Burlap,10-oz,40-inch NY yd-n,w
Cotton,1 1/16 std lw-mdMphs-u
Cotlook 'A' Index-t
Hides,hvy native steers piece fob-u
Wool,64s,staple,Terr del-u,w
0.6050
0.6981
*n.a.
n.a.
4.55
Grains and Feeds
Barley,top-quality Mnpls-u
Bran,wheat middlings, KC-u
Corn,No. 2 yellow,Cent IL-bp,u
Corn gluten feed,Midwest-u,w
Corn gluten meal,Midwest-u,w
Cottonseed meal-u,w
Hominy feed,Cent IL-u,w
Meat-bonemeal,50% pro Mnpls-u,w
Oats,No.2 milling,Mnpls-u
Rice, 5% Broken White, Thailand-l,w
Rice, Long Grain Milled, No. 2 AR-u,w
Sorghum,(Milo) No.2 Gulf-u
SoybeanMeal,Cent IL,rail,ton48%-u
4.70
61
3.1100
78.5
475.9
198
88
323
2.7700
371.00
23.75
7.4775
296.60
Tuesday
Soybeans,No.1 yllw IL-bp,u
Wheat,Spring14%-pro Mnpls-u
Wheat,No.2 soft red,St.Louis-bp,u
Wheat - Hard - KC (USDA) $ per bu-u
Wheat,No.1soft white,Portld,OR-u
9.0950
7.3275
4.0650
3.4725
5.0738
Beef,carcass equiv. index
choice 1-3,600-900 lbs.-u
select 1-3,600-900 lbs.-u
Broilers,dressed 'A'-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
168.51
165.76
n.a.
0.9215
2.5550
150.00
152.75
84.50
2208
1.2691
1.5047
0.7750
14.25
n.a.
71.80
n.a.
1.0183
n.a.
161.25
Fats and Oils
Corn oil,crude wet/dry mill-u,w
Grease,choice white,Chicago-h
Lard,Chicago-u
Soybean oil,crude;Centl IL-u
Tallow,bleach;Chicago-h
Tallow,edible,Chicago-u
36.7500
n.a.
n.a.
0.3353
0.3513
0.3550
August 29, 2017
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.
July index
level
Chg From (%)
June '17 July '16
U.S. consumer price index
–0.07
–0.03
244.786
251.936
All items
Core
1.7
1.7
Latest
Week
ago
52-Week
High
Low
4.25 4.25 4.25 3.50
2.95 2.95 2.95 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
0.25
0.25
0.25
Treasury bill auction
Australia
1.50
1.50
1.50
1.50
4 weeks
13 weeks
26 weeks
Overnight repurchase
1.09
1.14
U.S.
1.38
0.15
Discount
1.75
1.75
1.75
1.00
Low
1.0500 0.9900 1.1600 0.2000
Bid
1.1600 1.1600 1.1700 0.2800
Offer
1.1700 1.1700 1.1900 0.3000
AlerianMLPETF
CnsmrDiscSelSector
CnsStapleSelSector
DBGoldDoubleLgETN
DBGoldDoubleShrt
DeutscheXMSCIEAFE
EnSelectSectorSPDR
FinSelSectorSPDR
GuggS&P500EW
HealthCareSelSect
IndSelSectorSPDR
iShIntermCredBd
iSh1-3YCreditBond
iSh3-7YTreasuryBd
iShCoreMSCIEAFEETF
iShCoreMSCIEmgMk
iShCoreMSCITotInt
iShCoreS&P500ETF
iShCoreS&PMdCp
iShCoreS&PSmCpETF
iShS&PTotlUSStkMkt
iShCoreUSAggBd
iShSelectDividend
iShEdgeMSCIMinEAFE
iShEdgeMSCIMinUSA
iShGoldTr
iShiBoxx$InvGrCpBd
iShiBoxx$HYCpBd
iShJPMUSDEmgBd
iShMBSETF
iShMSCIACWIETF
iShMSCI EAFE
iShMSCIEAFESC
iShMSCIEmgMarkets
iShMSCIEurozoneETF
iShMSCIJapanETF
iShNasdaqBiotech
iShNatlMuniBdETF
iShRussell1000Gwth
iShRussell1000ETF
iShRussell1000Val
iShRussell2000Gwth
iShRussell2000ETF
iShRussell2000Val
iShRussell3000ETF
iShRussellMid-Cap
iShRussellMCValue
iShS&PMC400Growth
iShS&P500Growth
AMLP
XLY
XLP
DGP
DZZ
DBEF
XLE
XLF
RSP
XLV
XLI
CIU
CSJ
IEI
IEFA
IEMG
IXUS
IVV
IJH
IJR
ITOT
AGG
DVY
EFAV
USMV
IAU
LQD
HYG
EMB
MBB
ACWI
EFA
SCZ
EEM
EZU
EWJ
IBB
MUB
IWF
IWB
IWD
IWO
IWM
IWN
IWV
IWR
IWS
IJK
IVW
10.87
88.60
54.70
25.38
5.32
29.91
62.64
24.57
92.26
79.52
67.95
110.52
105.51
124.63
62.29
53.76
59.47
246.54
170.38
68.02
55.90
110.32
91.90
70.54
49.96
12.58
121.30
88.12
116.27
107.56
66.94
66.48
59.70
44.69
41.70
54.31
317.82
111.48
122.05
136.08
114.98
166.63
137.49
114.73
144.61
190.14
82.36
192.77
140.46
0.09 –13.7
8.8
–0.09
5.8
0.35
–0.39 26.1
0.57 –22.4
6.6
–0.23
–0.13 –16.8
5.7
–0.32
6.5
–0.10
0.19 15.3
9.2
0.73
2.2
0.08
0.5
0.04
1.7
0.14
–0.37 16.1
–0.24 26.6
–0.40 17.8
9.6
0.13
3.0
–0.08
–0.03 –1.1
9.0
0.14
2.1
0.15
3.8
–0.17
–0.37 15.2
0.04 10.5
–0.16 13.5
3.5
0.07
1.8
–0.12
5.5
0.06
1.1
0.07
–0.07 13.1
–0.40 15.2
–0.47 19.8
–0.18 27.6
–0.69 20.5
–0.20 11.2
0.29 19.8
3.1
0.13
0.26 16.3
9.3
0.08
2.6
–0.10
8.2
0.22
2.0
0.02
–0.16 –3.5
8.7
0.05
6.3
–0.17
2.4
–0.28
5.8
–0.14
0.24 15.3
Closing Chg YTD
Symbol Price (%) (%)
iShS&P500ValueETF
iShUSPfdStk
iShTIPSBondETF
iSh1-3YTreasuryBd
iSh7-10YTreasuryBd
iSh20+YTreasuryBd
iShRussellMCGrowth
PIMCOEnhShMaturity
PwrShQQQ 1
PwrShS&P500LoVol
PwrShSrLoanPtf
SPDRBloomBarcHYBd
SPDR Gold
SchwabIntEquity
SchwabUS BrdMkt
SchwabUS LC
SPDR DJIA Tr
SPDR S&PMdCpTr
SPDR S&P 500
SPDR S&P Div
TechSelectSector
UtilitiesSelSector
VanEckGoldMiner
VangdInfoTech
VangdSC Val
VangdDivApp
VangdFTSEDevMk
VangdFTSE EM
VangdFTSE Europe
VangdFTSEAWxUS
VangdGrowth
VangdHlthCr
VangdHiDiv
VangdIntermBd
VangdIntrCorpBd
VangdLC
VangdMC
VangdMC Val
VangdREIT
VangdS&P500
VangdST Bond
VangdSTCpBd
VangdSC
VangdTotalBd
VangdTotIntlBd
VangdTotIntlStk
VangdTotalStk
VangdTotlWrld
VangdValue
WisdTrEuropeHdg
WisdTrJapanHdg
IVE
PFF
TIP
SHY
IEF
TLT
IWP
MINT
QQQ
SPLV
BKLN
JNK
GLD
SCHF
SCHB
SCHX
DIA
MDY
SPY
SDY
XLK
XLU
GDX
VGT
VBR
VIG
VEA
VWO
VGK
VEU
VUG
VHT
VYM
BIV
VCIT
VV
VO
VOE
VNQ
VOO
BSV
VCSH
VB
BND
BNDX
VXUS
VTI
VT
VTV
HEDJ
DXJ
104.47
38.85
114.36
84.66
108.16
127.65
108.32
101.81
142.97
45.36
23.14
37.09
124.42
32.46
59.04
58.45
218.59
311.17
244.85
88.53
58.06
55.12
24.42
148.73
120.75
92.24
42.22
44.10
56.38
51.73
129.71
147.65
78.74
85.52
88.43
112.42
142.42
102.49
83.09
224.85
80.19
80.34
133.48
82.46
54.85
53.63
125.46
68.98
97.00
61.19
51.62
Contract
High hilo
Low
Open
16.54
16.42
16.51
16.53
.02
–.12
4,732
5,489
–38
254
–38 146,915
–2.60
485
–2.70 105,606
–.49 393,475
–.36 234,445
.13
3,172
.23
211
.15 144,672
–1.90
–2.10
610
7,343
Chg
Sept
Dec
.9192
.9240
.9245
.9286
.9107
.9148
.9123 –.0052 209,190
.9165 –.0051
5,902
Sept
Dec
.7985
.7988
.8042
.8048
.7970
.7978
.7984 –.0023 184,303
.7990 –.0023
5,609
Sept
Dec
1.2941
1.2981
1.2988
1.3025
1.2910
1.2965
1.2931 –.0017 219,426
1.2970 –.0017
4,549
Sept
Dec
1.0517
1.0580
1.0622
1.0683
1.0472
1.0537
1.0497
1.0560
.7939
.7933
.7929
.7931
.7901
.7900
.7898
.7982
.7978
.7975
.7971
.7925
.7906
.7918
.7904
.7902
.7899
.7895
.7901
.7900
.7892
.7956
.7953
.7950
.7947
.7937
.7927
.7916
Canadian Dollar (CME)-CAD 100,000; $ per CAD
British Pound (CME)-£62,500; $ per £
Swiss Franc (CME)-CHF 125,000; $ per CHF
Australian Dollar (CME)-AUD 100,000; $ per AUD
Sept
Oct
Nov
Dec
March'18
June
Sept
Mexican Peso (CME)-MXN 500,000; $ per MXN
.05544
.05467
.05583 –.00012 242,271
.05504 –.00012
5,713
Sept
Dec
1.1991
1.2050
1.2083 s
1.2141 s
1.1958
1.2017
1.2003
1.2062
156-300
155-220
6.0 240,724
5.0 569,118
Sept
Dec
127-010 127-190
126-270 127-105
127-010
126-240
127-060
126-300
6.0 1,105,525
6.5 2,360,139
Mini DJ Industrial Average (CBT)-$5 x index
Sept
Dec
118-220 118-317
118-130 118-232
118-217
118-130
118-250
118-165
4.0 942,163
4.2 2,475,945
S&P 500 Index (CME)-$250 x index
Sept
Dec
108-082 108-105
108-045 108-070
108-080
108-045
108-090
108-057
1.2 643,451
1.7 975,656
98.843
98.765
98.840
98.770
–.005 175,952
.005 321,007
30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg.
Aug
Jan'18
98.845
98.765
98.845
98.780
10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100%
Sept
Dec
104.000
103.641
104.031 s
103.641 s
103.531
103.453
98.7550
98.7550
98.7550
Eurodollar (CME)-$1,000,000; pts of 100%
Sept
Dec
March'18
Dec
98.6700
98.5800
98.5250
98.3650
98.6750
98.6000
98.5550
98.4150 s
98.6700
98.5750
98.5250
98.3650
.0010 452,541
.0010 11,278
Index Futures
Sept
Dec
21751
21708
21879
21832
21644
21555
21874
21829
Sept
Dec
2429.30
2424.50
2448.50
2443.70
2421.30
2424.50
2447.10
2445.10
3.40
3.40
Sept
Dec
2434.00
2433.25
2448.50
2446.25
2421.00
2419.25
2447.00
2445.00
3.25 3,165,053
3.25 108,841
Sept
1703.00
1708.20
1692.20
1706.30
5820.0
5838.5
5875.5
5881.8
5777.3
5784.5
5869.8
5876.3
25.0 282,261
24.3
2,909
Mini S&P 500 (CME)-$50 x index
Mini S&P Midcap 400 (CME)-$100 x index
Mini Nasdaq 100 (CME)-$20 x index
83 148,117
80
1,093
–1.40
71,201
450
87,561
103.594
103.281
.156
.172
32,098
1
Sept
Dec
98.7575
…
365
Sept
Dec
1373.00
1371.30
1386.20
1384.70
1368.40
1369.30
1382.80
1381.50
1.00 555,717
.90
411
98.6700
98.5800
98.5350
98.3850
…
…
.0150
.0250
1,367,578
2,020,813
1,177,551
1,511,951
Sept
1346.30
1355.60
1346.30
1354.90
1.40
8,389
Sept
Dec
92.19
91.99
92.41
92.19
91.55
91.35
92.18
91.96
.04
.03
50,569
4,605
1 Month Libor (CME)-$3,000,000; pts of 100%
Oct
–.0015 153,830
–.0015
443
–.0015
37
–.0015
5,912
–.0015
219
–.0014
18
–.0015
61
.05595 s
.05515
156-260
155-180
2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100%
41,318
604
.05574
.05484
157-000 158-040
155-250 156-280
5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100%
.0011
.0012
Sept
Dec
Sept
Dec
Treasury Notes (CBT)-$100,000; pts 32nds of 100%
Open
interest
Currency Futures
Euro (CME)-€125,000; $ per €
Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
Settle
Japanese Yen (CME)-¥12,500,000; $ per 100¥
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
t
t
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
YTD total
return (%)
Yield (%)
Latest Low High
Index
YTD total
return (%)
Yield (%)
Latest Low High
Index
Mortgage-Backed Bloomberg Barclays
Broad Market Bloomberg Barclays
3.5 U.S. Aggregate
1945.78
Total
return
close
2.430 1.920 2.790
U.S. Corporate Indexes Bloomberg Barclays
1988.83
2.4
Mortgage-Backed
1956.29
1.9
Ginnie Mae (GNMA) 2.720 1.920 3.090
2.740 2.000 3.120
3.080 2.780 3.520
1166.39
2.6
Fannie mae (FNMA) 2.740 2.030 3.120
2621.52
3.9 Intermediate
2.580 2.210 3.010
1796.00
2.7
Freddie Mac (FHLMC) 2.750 2.030 3.130
3799.57
8.1 Long term
4.170 3.980 4.710
523.19
4.9
Muni Master
1.752 1.358 2.516
567.07
4.1 Double-A-rated
2.510 2.120 2.870
366.67
5.6
7-12 year
1.765 1.395 2.618
3.390 3.180 3.870
408.46
5.9
12-22 year
2.268 1.693 3.047
392.92
5.9
22-plus year
2.823 2.146 3.622
5.2
2768.56
5.6
712.99
U.S. Corporate
Triple-B-rated
High Yield Bonds Merrill Lynch
411.13
5.8
High Yield Constrained 5.653 5.399 6.858
Global Government J.P. Morgan†
1.6
408.76
6.3
Triple-C-rated
10.686 9.584 15.015
545.78
2832.03
5.5
High Yield 100
5.202 4.948 6.448
757.37
0.5
Canada
1.940 1.240 2.120
373.27
6.0
Global High Yield Constrained 5.180 5.073 6.450
369.90
0.3
EMU§
1.091 0.520 1.363
302.18
5.3
Europe High Yield Constrained 2.349 2.249 3.814
710.31
0.5
France
0.820 0.280 1.210
Germany
0.370 -0.100 0.620
Japan
0.370 0.140 0.460
Netherlands
0.520 0.030 0.760
512.06
U.S Agency Bloomberg Barclays
Global Government 1.330 0.870 1.560
-0.5
1646.43
2.5
U.S Agency
1.740 1.260 1.960
288.61
1471.36
1.7
10-20 years
1.560 1.090 1.750
564.42
8.3 20-plus years
2.810 2.430 3.460
940.55
3.0 U.K.
Yankee
2.660 2.350 3.090
799.98
8.2 Emerging Markets ** 5.416 5.134 6.290
3386.32
4.7
2455.44
0.2
-0.3
*Constrained indexes limit individual issuer concentrations to 2%; the High Yield 100 are the 100 largest bonds
** EMBI Global Index
1.380 0.990 1.790
† In local currency § Euro-zone bonds
Sources: Merrill Lynch; Bloomberg Barclays; J.P.Morgan
0.960 0.940 0.990 0.160
1.020 1.000 1.180 0.250
1.115 1.115 1.140 0.420
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
0.000
2.200
Week
Latest ago
Call money
3.00
3.00
3.00
2.25
Commercial paper (AA financial)
1.23
90 days
1.26
0.100
0.100
2.750
52-Week
high
low
1.28
0.62
0.805
1.562
l
1.869
1.818
1.477
52.7
53.6
l
2.674
2.693
1.887
49.7
51.7
32.5
France 2 -0.512 t
10 0.661 t
l
-0.505
-0.463
-0.560
-183.9
-136.5
l
0.700
0.805
0.200
Germany 2 -0.749 t
10 0.343 t
l
-0.740
-0.683
l
0.380
Italy 2 -0.023 s
10 2.066 t
l
-0.023
l
Japan 2 -0.155 s
10 0.004 t
l
l
0.008
0.078
Spain 2 -0.342 s
10 1.567 t
l
-0.345
-0.334
l
1.594
1.530
0.955
0.162 t
1.000 t
l
0.179
0.255
0.167
l
1.054
1.218
0.569
1.848 t
2.635 t
10
30-year mortgage yields
Other short-term rates
1.355
2.293
l
Australia 2
0.500
3.326 3.404 3.865 2.832
3.349 3.430 3.899 2.861
1.334
2.157
l
2.750
0.050
30 days
60 days
Year ago
U.S. 2 1.321 t
10 2.137 t
2.750
1.000
1.450
–0.11
–0.09
0.16
0.05
0.23
0.32
–0.02
...
0.39
0.15
...
–0.11
–0.22
–0.31
0.10
0.07
0.30
–0.09
0.11
–0.06
0.43
–0.22
0.66
0.41
–0.07
0.22
–0.42
–0.20
–0.44
–0.33
0.21
0.18
0.03
0.13
0.09
0.09
–0.22
–0.39
–0.11
0.08
0.09
0.06
–0.08
0.11
0.04
–0.41
0.04
–0.09
0.01
–0.50
0.43
3.0
4.4
1.1
0.2
3.2
7.2
11.2
0.5
20.7
9.1
–0.9
1.8
13.5
17.3
9.0
9.7
10.7
3.1
9.5
3.5
20.1
13.5
16.7
22.4
–0.2
8.3
15.5
23.3
17.6
17.1
16.4
16.5
3.9
2.9
3.2
9.8
8.2
5.5
0.7
9.5
0.9
1.2
3.5
2.1
1.0
16.9
8.8
13.1
4.3
6.6
4.2
One month
Three month
Six month
One year
1.23889
1.31694
1.45167
1.71400
1.23611
1.31722
1.45611
1.72733
1.23889
1.31778
1.46544
1.82761
0.51322
0.83344
1.23361
1.53922
-0.401
-0.373
-0.308
-0.208
-0.399
-0.373
-0.307
-0.205
-0.371
-0.319
-0.205
-0.071
-0.405
-0.378
-0.308
-0.208
Euro Libor
One month
Three month
Six month
One year
Euro interbank offered rate (Euribor)
-0.372
-0.330
-0.273
-0.160
One month
Three month
Six month
One year
Latest
-0.371
-0.328
-0.273
-0.158
Value
Traded
-0.366
-0.299
-0.192
-0.051
-0.375
-0.332
-0.274
-0.163
52-Week
High
Low
DTCC GCF Repo Index
Treasury
MBS
1.111
1.143
29.400 1.366 0.244
83.580 1.506 0.257
Open Implied
Settle Change Interest Rate
DTCC GCF Repo Index Futures
Treasury Aug
Treasury Sep
Treasury Oct
98.875 unch. 3335 1.125
98.835 -0.015 2382 1.165
98.765 -0.005 1868 1.235
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 June 15, 2017. Other
prime rates aren’t directly comparable; lending
practices vary widely by location; Discount rate
is effective June 15, 2017. DTCC GCF Repo Index
is Depository Trust & Clearing Corp.'s weighted
average for overnight trades in applicable
CUSIPs. Value traded is in billions of U.S. dollars.
Federal-funds rates are Tullett Prebon rates as
of 5:30 p.m. ET. Futures on the DTCC GCF Repo
Index are traded on NYSE Liffe US.
Sources: Federal Reserve; Bureau of Labor
Statistics; DTCC; SIX Financial Information;
General Electric Capital Corp.; Tullett Prebon
Information, Ltd.
Spread Under/Over U.S. Treasurys, in basis points
Latest
Prev
Year ago
Month ago
1.250
2.250
0.000
Yield (%)
Latest(l) 0 20 40 60 80 100 120 Previous
1.750
U.K. 2
4.250
10
-183.3
67.2
-145.8
-136.2
-207.3
-142.0
0.544
-0.615 -207.0
-0.043 -179.4
-177.7
-160.5
-0.019
-0.085
-134.4
-135.7
-89.0
2.090
2.127
1.146
-7.2
-0.155
-0.112
-0.182
-147.6
-6.7
-41.6
-148.9
-98.7
-0.065 -213.3
-214.9
-162.7
-0.208
-166.3
-167.9
-101.3
-57.0
-56.4
-60.7
-147.7
-116.0
-115.4
-63.9
-113.8
-110.4
-99.3
Source: Tullett Prebon
Corporate Debt
in that same company’s share price.
Investment-grade spreads that tightened the most…
Libor
Largest 100 exchange-traded funds, latest session
ETF
—52-WEEK—
High Low
Secondary market
Effective rate 1.1700 1.1800 1.2000 0.3300
High
1.3125 1.3125 1.3125 0.5625
ETF
16.51
16.40
Interest Rate Futures
Fannie Mae
Federal funds
Exchange-Traded Portfolios | WSJ.com/ETFresearch
Tuesday, August 29, 2017
Closing Chg YTD
Symbol Price (%) (%)
Week
Latest ago
0.25
U.S. government rates
Prime rates
U.S.
Canada
Japan
—52-WEEK—
High Low
Britain
International rates
Open
interest
Chg
Global Government Bonds: Mapping Yields
Borrowing Benchmarks | WSJ.com/bonds
Money Rates
Week
Latest ago
Settle
t
16.20
16.34
Cocoa (ICE-US)-10 metric tons; $ per ton.
Sept
2,027
2,027
1,994
1,977
Dec
1,999
2,009
1,944
1,959
Coffee (ICE-US)-37,500 lbs.; cents per lb.
Sept
130.15
130.15
127.15
127.30
Dec
131.70
131.85
128.20
128.65
Sugar-World (ICE-US)-112,000 lbs.; cents per lb.
Oct
14.26
14.33
13.72
13.82
March'18
14.81
14.88
14.38
14.48
Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb.
25.29
25.29
25.29
25.29
Nov
Cotton (ICE-US)-50,000 lbs.; cents per lb.
Oct
70.26
70.85
70.15
70.56
Dec
69.85
70.46
69.33
69.98
Orange Juice (ICE-US)-15,000 lbs.; cents per lb.
132.40
132.75
130.65
130.85
Sept
Nov
132.85
134.35
130.65
131.15
Total
return
close
Food
KEY TO CODES: A=ask; B=bid; BP=country elevator bids to producers; C=corrected; E=Manfra,Tordella & Brooks; G=ICE; H=Hurley Brokerage; I=Natural Gas Intelligence;
L=livericeindex.com; M=midday; N=nominal; n.a.=not quoted or not available; R=SNL Energy; S=The Steel Index; T=Cotlook Limited; U=USDA; W=weekly, Z=not quoted.
*Data as of 8/28
Source: WSJ Market Data Group
Inflation
Contract
High hilo
Low
Open
Milk (CME)-200,000 lbs., cents per lb.
Agriculture Futures
Open
interest
WSJ.com/commodities
Maturity
Current
Spread*, in basis points
One-day change
Last week
Stock Performance
Close ($)
% chg
Issuer
Symbol Coupon (%)
CA
Kimco Realty
Electricite de France S.A.
Kraft Heinz Foods
CA
KIM
EDF
KHC
4.500
6.875
2.350
2.800
Aug. 15, ’23
Oct. 1, ’19
Oct. 13, ’20
July 2, ’20
159
71
48
63
–13
–12
–7
–6
166
n.a.
n.a.
68
32.67
19.29
…
…
0.18
–0.52
…
…
Unilever Capital
Duke Energy
Home Depot
AT&T
UNANA
DUK
HD
T
2.600
May 5, ’24
3.150 Aug. 15, ’27
3.950 Sept. 15, ’20
2.850 Feb. 14, ’23
63
93
22
115
–6
–5
–5
–5
68
97
n.a.
120
...
87.50
149.84
37.85
...
0.09
–0.44
–0.24
n.a.
n.a.
n.a.
49
23.58
85.42
167.41
51.66
–0.59
0.01
–0.53
–0.12
140
n.a.
136
n.a.
…
37.80
…
49.45
…
–0.26
…
0.43
…And spreads that widened the most
Bank of America
American Express
Alibaba Group Holding
Toronto–Dominion Bank
BAC
AXP
BABA
TD
8.000 Jan. 30, ’49
2.600 Sept. 14, ’20
2.500 Nov. 28, ’19
2.250
Nov. 5, ’19
NBCUniversal Media
Viacom
Credit Suisse Funding
Oracle
CMCSA
VIA
CS
ORCL
5.950
4.250
4.875
3.250
April 1, ’41
Sept. 1, ’23
May 15, ’45
May 15, ’30
65
50
73
45
26
15
14
13
8
8
7
7
138
187
145
95
High-yield issues with the biggest price increases…
Issuer
Symbol
Albertsons
Diamond Offshore Drilling
Ingles Markets
Ensco
ALBLLC
DO
IMKTA
ESV
Tesla
H&E Equipment Services
Frontier Communications
Genesys Telecommunications Laboratories
TSLA
5.300
HEES
7.000
FTR
11.000
GENLAB 10.000
Coupon (%)
Maturity
6.625 June 15, ’24
7.875 Aug. 15, ’25
5.750 June 15, ’23
5.200 March 15, ’25
Aug. 15, ’25
Sept. 1, ’22
Sept. 15, ’25
Nov. 30, ’24
Bond Price as % of face value
Current
One-day change
98.500
101.500
100.625
73.500
99.500
103.820
87.000
114.250
2.50
2.50
2.07
Last week
Stock Performance
Close ($)
% chg
1.19
97.577
99.500
100.375
73.250
...
11.58
20.90
4.60
...
1.49
–4.57
5.02
1.08
1.07
1.00
1.00
99.500
103.875
83.000
n.a.
347.36
23.07
13.55
...
0.49
7.50
2.26
...
n.a.
104.875
67.750
96.750
4.66
77.59
...
12.85
0.22
–1.98
...
–1.53
n.a.
106.750
77.750
85.000
6.95
...
4.13
...
–1.14
...
–0.72
...
…And with the biggest price decreases
CSI Compressco
HCA
Murray Energy
AMC Entertainment Holdings
CCLP
7.250
HCA
5.375
MURREN 11.250
AMC
6.125
Aug. 15, ’22
Feb. 1, ’25
April 15, ’21
May 15, ’27
90.205 –2.80
–2.25
105.250
–2.00
57.750
–1.25
94.250
Oasis Petroleum
Rackspace Hosting
Sanchez Energy
Valeant Pharmaceuticals International
OAS
RAX
SN
VRXCN
6.875
8.625
6.125
5.875
Jan. 15, ’23
Nov. 15, ’24
Jan. 15, ’23
May 15, ’23
96.000
106.500
76.000
84.875
–1.25
–1.00
–1.00
–0.91
*Estimated spread over 2-year, 3-year, 5-year, 10-year or 30-year hot-run Treasury; 100 basis points=one percentage pt.; change in spread shown is for Z-spread.
Note: Data are for the most active issue of bonds with maturities of two years or more
Sources: MarketAxess Corporate BondTicker; WSJ Market Data Group
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | B11
BIGGEST 1,000 STOCKS
WSJ.com/stocks
How to Read the Stock Tables
The following explanations apply to NYSE,
NYSE Arca, NYSE MKT and Nasdaq Stock
Market listed securities. Prices are composite
quotations that include primary market trades
as well as trades reported by Nasdaq OMX
BXSM (formerly Boston), Chicago Stock
Exchange, CBOE, National Stock Exchange, ISE
and BATS.
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.
Stock
Footnotes:
s-New 52-week high.
t-New 52-week low.
dd-Indicates loss in the most recent
four quarters.
FD-First day of trading.
h-Does not meet continued listing
standards
lf-Late filing
q-Temporary exemption from Nasdaq
requirements.
t-NYSE bankruptcy
v-Trading halted on primary market.
vj-In bankruptcy or receivership or
being reorganized under the
Bankruptcy Code, or securities
assumed by such companies.
Wall Street Journal stock tables reflect composite regular trading as of 4 p.m. and
changes in the closing prices from 4 p.m. the previous day.
Tuesday, August 29, 2017
Net
Sym Close Chg
Stock
NYSE
ABB
ABB 22.92 -0.15
AES
AES 11.17 -0.02
Aflac
AFL 81.71 0.91
AT&T
T
37.85 -0.09
AbbottLabs ABT 50.15 -0.11
AbbVie
ABBV 73.89 0.57
Accenture ACN 129.66 0.42
AcuityBrands AYI 173.99 -0.80
Adient
ADNT 68.30 0.29
AdvanceAuto AAP 95.12 0.46
AdvSemiEngg ASX 6.13 0.03
Aegon
AEG 5.67 -0.17
AerCap
AER 49.48 0.28
Aetna
AET 156.42 -0.11
AffiliatedMgrs AMG 173.88 -0.11
s AgilentTechs A
63.49 0.03
AgnicoEagle AEM 51.02 1.42
Agrium
AGU 97.20 0.90
AirProducts APD 145.37 -0.41
AlaskaAir ALK 74.38 0.07
Albemarle ALB 114.46 -0.97
s Alcoa
AA 43.00 0.83
AlexandriaRealEst ARE 118.65 -0.65
Alibaba
BABA 167.41 -0.89
Alleghany Y
559.89 -3.60
Allegion
ALLE 77.77 -0.28
Allergan
AGN 223.58 -0.36
AllianceData ADS 223.64 -0.04
AllianceBernstein AB 23.20 -0.10
s AlliantEnergy LNT 43.06 -0.02
Allstate
ALL 90.82 0.54
AllyFinancial ALLY 22.09 -0.11
AlticeUSA ATUS 30.85 -0.20
Altria
MO 63.81 -0.12
AlumofChina ACH 17.50 0.25
Ambev
ABEV 6.23
...
s Ameren
AEE 60.42 -0.15
AmericaMovil AMX 18.74
...
AmericaMovil A AMOV 18.55 -0.01
AmCampus ACC 47.10 0.07
s AEP
AEP 73.94 -0.16
AmericanExpress AXP 85.42 0.01
AmericanFin AFG 101.28 -0.23
AmerHomes4Rent AMH 21.98 -0.32
AIG
AIG 60.21 -0.45
s AmerTowerREIT AMT 145.89 0.11
AmerWaterWorks AWK 81.36 -0.64
Amerigas APU 43.10 -0.01
Ameriprise AMP 137.38 -0.37
AmerisourceBrgn ABC 78.56 -0.10
Ametek
AME 62.57 0.19
s Amphenol APH 80.16 0.41
t AnadarkoPetrol APC 40.71 -0.56
Andeavor ANDV 98.81 0.85
AB InBev BUD 116.85 1.04
AnnalyCap NLY 12.35 -0.08
AnteroMidstream AM 32.23 0.01
AnteroResources AR 19.41 -0.21
Anthem
ANTM 193.83 0.35
Aon
AON 137.90 -0.48
t Apache
APA 38.87 -0.48
ApartmtInv AIV 44.97 -0.54
ApolloGlobalMgmt APO 28.84 -0.07
AquaAmerica WTR 33.69 -0.18
Aramark
ARMK 40.09 -0.18
ArcelorMittal MT 26.39 -0.15
ArcherDaniels ADM 41.74 -0.03
Arconic
ARNC 25.35 0.18
AristaNetworks ANET 173.28 -0.83
ArrowElec ARW 77.31 0.13
AstraZeneca AZN 29.46 0.02
Athene
ATH 53.01 -0.35
s AtmosEnergy ATO 88.19 -0.50
Autohome ATHM 64.05 0.87
Autoliv
ALV 106.58 0.65
AutoZone AZO 522.38 -3.02
Avalonbay AVB 187.28 -1.05
Avangrid
AGR 48.93 0.03
AveryDennison AVY 93.45 0.15
AxaltaCoating AXTA 29.27 -0.01
BB&T
BBT 46.07 -0.07
BCE
BCE 47.51 -0.06
BHPBilliton BHP 43.00 0.17
BHPBilliton BBL 37.64 0.15
BP
BP 34.37 -0.10
BRF
BRFS 13.44 0.15
BT Group BT 18.89 -0.14
BakerHughes BHGE 33.75 0.50
Ball
BLL 39.06 -0.02
BancoBilbaoViz BBVA 8.85 -0.05
BancodeChile BCH 89.07 0.71
BancoMacro BMA 105.69 -2.13
BcoSantChile BSAC 29.59 -0.06
BancoSantander SAN 6.50
...
BanColombia CIB 44.97 0.90
BankofAmerica BAC 23.58 -0.14
BankofMontreal BMO 71.93 -1.95
BankNY Mellon BK 52.09 -0.18
BkNovaScotia BNS 61.75 -0.16
Barclays
BCS 9.86 -0.08
Bard CR
BCR 319.52
...
BarrickGold ABX 17.82 0.18
BaxterIntl BAX 61.41 -0.23
BectonDickinson BDX 198.90 -0.15
Berkley
WRB 66.69 -0.02
BerkHathwy A BRK/A 268090 55.00
BerkHathwy B BRK/B 178.62 -0.08
BerryGlobal BERY 55.52 -0.17
BestBuy
BBY 55.02 -7.45
Bio-RadLab A BIO 216.76 -0.17
BlackKnightFin BKFS 41.65 -0.25
BlackRock BLK 414.13 -0.21
BlackstoneGroup BX 31.94 -0.01
BlockHR
HRB 29.23 -0.38
t BoardwalkPipe BWP 14.52 -0.02
Boeing
BA 240.49 3.31
BorgWarner BWA 44.37 0.12
BostonProperties BXP 119.50 -0.75
BostonScientific BSX 27.05 0.08
Braskem
BAK 24.40 0.34
Bristol-Myers BMY 58.86 0.28
BritishAmTob BTI 61.50 -0.41
BrixmorProp BRX 18.52 -0.21
BroadridgeFinl BR 76.78 -0.13
BrookfieldMgt BAM 39.29 0.16
BrookfieldInfr BIP 43.63 0.30
Brown&Brown BRO 44.76 -0.40
Brown-Forman A BF/A 53.57 0.98
Brown-Forman B BF/B 51.20 1.16
BuckeyePtrs BPL 55.68 0.09
Bunge
BG 74.20 -0.38
BurlingtonStores BURL 84.76 -2.44
Stock
Net
Sym Close Chg
CBD Pao
CBD 23.32
CBRE Group CBG 35.15
CBS A
CBS/A 63.88
CBS B
CBS 63.27
CF Industries CF 28.83
CGI Group GIB 49.89
CIT Group CIT 44.57
s CMS Energy CMS 48.74
CNA Fin
CNA 49.17
CNOOC
CEO 120.20
s CPFLEnergia CPL 17.06
CRH
CRH 34.23
CVS Health CVS 76.09
CabotOil
COG 24.87
CamdenProperty CPT 89.03
CampbellSoup CPB 50.81
CIBC
CM 83.51
CanNtlRlwy CNI 79.37
CanNaturalRes CNQ 31.13
CanPacRlwy CP 153.65
Canon
CAJ 34.94
CapitalOne COF 79.74
CardinalHealth CAH 66.40
Carlisle
CSL 94.05
CarMax
KMX 63.56
Carnival
CCL 68.11
Carnival
CUK 68.64
Caterpillar CAT 116.01
Celanese A CE 97.20
Cemex
CX
9.16
CenovusEnergy CVE 7.50
Centene
CNC 86.22
s CenterPointEner CNP 29.89
CentraisElBras EBR 5.91
CenturyLink CTL 20.63
Chemours CC 47.62
Chevron
CVX 107.86
ChinaEastrnAir CEA 27.23
ChinaLifeIns LFC 16.08
ChinaMobile CHL 53.43
ChinaPetrol SNP 75.14
ChinaSoAirlines ZNH 37.99
ChinaTelecom CHA 50.52
ChinaUnicom CHU 14.62
Chipotle
CMG 310.37
Chubb
CB 141.89
ChunghwaTelecom CHT 34.36
Church&Dwight CHD 49.52
Cigna
CI 180.09
CimarexEnergy XEC 98.37
Citigroup
C
67.48
CitizensFin CFG 33.31
Clorox
CLX 137.37
Coach
COH 41.71
Coca-Cola KO 45.45
Coca-Cola Euro CCE 42.93
Coca-Cola Femsa KOF 84.81
Colgate-Palmolive CL 71.30
ColonyNorthStar CLNS 12.77
Comerica
CMA 68.59
SABESP
SBS 9.95
t ConagraBrands CAG 32.43
t ConchoRscs CXO 108.47
ConocoPhillips COP 42.85
ConEd
ED 84.42
ConstBrands A STZ 198.40
ContinentalRscs CLR 33.01
Cooper
COO 246.15
Corning
GLW 28.57
Coty
COTY 16.51
Credicorp
BAP 202.38
CreditSuisse CS 14.74
CrestwoodEquity CEQP 24.60
CrownCastle CCI 107.02
CrownHoldings CCK 57.31
Cullen/Frost CFR 83.59
Cummins
CMI 154.84
s DTE Energy DTE 112.11
DXC Tech DXC 84.70
Danaher
DHR 81.99
Darden
DRI 82.64
DaVita
DVA 57.07
Deere
DE 115.89
s DellTechnologies DVMT 72.94
DelphiAutomotive DLPH 94.26
DeltaAir
DAL 46.62
DeutscheBank DB 16.04
DevonEnergy DVN 30.99
Diageo
DEO 132.60
DigitalRealty DLR 117.37
DiscoverFinSvcs DFS 58.45
Disney
DIS 102.57
DollarGeneral DG 76.89
DominionEner D
80.24
Domino's
DPZ 178.38
Donaldson DCI 46.52
DouglasEmmett DEI 37.89
Dover
DOV 83.85
DowChemical DOW 64.22
DrPepperSnap DPS 90.40
DuPont
DD 82.24
s DukeEnergy DUK 87.50
DukeRealty DRE 29.41
ENI
E
31.66
t EOG Rscs EOG 83.15
EQT
EQT 61.18
EQT Midstream EQM 73.77
EastmanChem EMN 84.57
Eaton
ETN 70.52
EatonVance EV 46.74
Ecolab
ECL 130.87
Ecopetrol
EC
9.17
EdisonInt
EIX 80.45
EdwardsLife EW 111.83
EmersonElectric EMR 58.35
EnbridgeEnPtrs EEP 14.34
Enbridge
ENB 39.77
Encana
ECA 8.95
s EnelAmericas ENIA 10.74
s EnelChile
ENIC 6.01
s EnelGenChile EOCC 25.81
EnergyTrfrEquity ETE 16.91
EnergyTransfer ETP 18.56
Entergy
ETR 79.85
EnterpriseProd EPD 25.50
EnvisionHlthcr EVHC 51.13
Equifax
EFX 140.80
EquityLife ELS 88.29
EquityResdntl EQR 67.15
EssexProp ESS 264.64
EsteeLauder EL 105.70
EverestRe RE 252.49
s EversourceEner ES 63.29
Exelon
EXC 38.22
ExtraSpaceSt EXR 78.08
ExxonMobil XOM 76.45
0.14
-0.35
-0.31
-0.48
-0.20
0.15
-0.33
0.11
-0.29
-0.63
-0.05
-0.58
0.63
0.11
-0.34
0.07
-0.88
0.11
0.26
0.90
0.14
-0.81
0.01
-0.19
0.08
-0.44
-0.53
0.94
-0.35
0.04
0.12
-0.12
-0.04
-0.19
-0.11
-0.10
0.10
0.15
-0.17
0.42
0.11
0.19
0.87
...
-1.65
0.11
-0.16
-0.22
-0.41
-1.20
-0.33
-0.16
-0.13
-0.19
0.03
...
0.32
0.40
-0.18
-0.65
0.15
-0.10
-0.47
-0.20
-0.17
0.52
-0.04
-1.48
-0.04
0.42
-0.39
-0.25
0.25
-0.03
0.22
-1.07
2.13
-0.03
-0.09
-0.38
-2.20
-0.25
-0.07
0.14
-0.23
-0.33
-0.36
0.06
0.18
-0.20
-0.65
0.01
-0.48
0.10
-0.38
-0.07
-0.20
-0.16
-0.45
0.06
-0.64
0.08
0.11
0.21
-0.25
0.35
-0.50
-0.86
0.08
-0.23
-0.59
0.08
-0.41
-1.28
-0.05
0.06
-0.13
-0.08
0.10
0.15
0.35
0.05
0.11
0.01
0.02
-0.40
0.18
-0.29
-0.22
-1.43
0.08
-0.40
0.02
-0.05
0.81
-0.02
Stock
Net
Sym Close Chg
FMC
FMC 84.43
FactSet
FDS 155.53
FederalRealty FRT 125.71
FedEx
FDX 211.30
Ferrari
RACE 113.76
FiatChrysler FCAU 14.82
FibriaCelulose FBR 13.04
FidelityNatlFin FNF 47.46
FNFV Group FNFV 17.10
FidelityNtlInfo FIS 91.94
58.com
WUBA 62.90
FirstData
FDC 18.17
FirstRepBank FRC 96.52
FirstEnergy FE 32.66
FleetCorTech FLT 142.75
FomentoEconMex FMX 100.42
FordMotor F
10.84
ForestCIty A FCE/A 23.68
Fortis
FTS 36.53
Fortive
FTV 64.46
FortBrandsHome FBHS 61.94
s Franco-Nevada FNV 82.02
FranklinRscs BEN 42.40
Freeport-McMoRan FCX 15.21
FreseniusMed FMS 46.74
GGP
GGP 20.71
Gallagher AJG 58.04
Gap
GPS 23.59
Gartner
IT 118.08
Gazit-Globe GZT 9.76
GeneralDynamics GD 200.95
t GeneralElec GE 24.44
GeneralMills GIS 53.93
GeneralMotors GM 35.52
Genpact
G
28.38
GenuineParts GPC 81.83
Gerdau
GGB 3.56
Gildan
GIL 30.83
GlaxoSmithKline GSK 39.32
GlobalPayments GPN 93.99
GoDaddy
GDDY 42.76
Goldcorp
GG 13.59
GoldmanSachs GS 219.96
Graco
GGG 113.13
Grainger
GWW 157.16
GreatPlainsEner GXP 31.01
GpoAeroportuar PAC 111.30
GpoAeroportSur ASR 200.33
GpoAvalAcciones AVAL 8.95
GpFinSantandMex BSMX 10.58
GrupoTelevisa TV 26.01
s GuidewireSoftware GWRE 74.09
HCA Healthcare HCA 77.59
HCP
HCP 29.51
HDFC Bank HDB 95.57
HP
HPQ 19.21
HSBC
HSBC 48.08
Halliburton HAL 38.72
Hanesbrands HBI 24.39
HarleyDavidson HOG 47.07
Harris
HRS 121.51
HartfordFinl HIG 54.33
HealthcareAmer HTA 30.49
Heico
HEI 84.47
Heico A
HEI/A 71.90
Herbalife
HLF 68.66
Hershey
HSY 104.94
t Hess
HES 38.13
HewlettPackard HPE 17.92
Hilton
HLT 62.89
HollyFrontier HFC 32.21
HomeDepot HD 149.84
HondaMotor HMC 27.86
Honeywell HON 137.63
t HormelFoods HRL 30.97
DR Horton DHI 35.28
HostHotels HST 17.68
HuanengPower HNP 25.68
Hubbell
HUBB 111.03
s Humana
HUM 255.67
HuntingtonIngalls HII 208.80
Huntsman HUN 26.40
HyattHotels H
58.10
ICICI Bank IBN 9.39
ING Groep ING 17.75
Invesco
IVZ 32.23
IDEX
IEX 115.20
IllinoisToolWks ITW 136.85
Infosys
INFY 15.27
Ingersoll-Rand IR
84.28
Ingredion
INGR 123.36
ICE
ICE 64.82
InterContinentl IHG 49.43
IBM
IBM 143.14
IntlFlavors IFF 135.95
IntlPaper
IP
53.20
Interpublic IPG 19.99
InvitationHomes INVH 22.66
IronMountain IRM 39.24
IsraelChemicals ICL
4.32
ItauUnibanco ITUB 12.93
JPMorganChase JPM 91.10
Jabil
JBL 30.61
JacobsEngineering JEC 53.17
JamesHardie JHX 14.07
JanusHenderson JHG 34.16
J&J
JNJ 132.21
JohnsonControls JCI 38.75
JonesLangLaSalle JLL 119.61
JuniperNetworks JNPR 27.43
KAR Auction KAR 44.47
KB Fin
KB 50.02
KKR
KKR 18.44
KT
KT 16.74
KSCitySouthern KSU 102.97
Kellogg
K
66.30
KeyCorp
KEY 17.25
KeysightTechs KEYS 39.45
KilroyRealty KRC 67.47
KimberlyClark KMB 122.38
KimcoRealty KIM 19.29
KinderMorgan KMI 19.02
KinrossGold KGC 4.41
Kohl's
KSS 39.15
KoninklijkePhil PHG 38.03
KoreaElcPwr KEP 19.38
Kroger
KR 21.81
Kyocera
KYO 60.17
LATAMAirlines LTM 12.33
L Brands
LB 36.52
LG Display LPL 13.63
LINE
LN 35.22
L3 Tech
LLL 181.83
LabCpAm LH 152.88
LambWeston LW 45.07
-0.11
-1.11
0.30
2.46
-0.07
-0.09
...
0.02
0.50
0.15
-0.85
-0.14
-1.31
-0.14
-0.31
0.20
0.05
-0.06
-0.16
-0.03
-0.01
0.23
-0.20
-0.32
-0.09
-0.02
-0.26
0.20
-0.76
-0.18
3.08
-0.03
-0.35
0.01
0.07
-1.12
-0.03
-0.09
-0.14
0.12
0.04
0.10
0.36
-1.13
0.91
-0.21
0.08
0.92
-0.02
-0.07
-0.03
0.23
-1.57
0.23
-0.34
0.03
0.20
-0.07
-0.12
0.01
0.18
-0.16
0.08
1.22
...
-0.15
0.47
-0.17
0.13
-0.28
0.74
-0.66
0.05
0.76
-0.08
-0.03
0.15
-0.12
1.44
0.60
2.68
-0.27
0.13
0.01
-0.10
-0.22
0.18
0.32
-0.04
0.42
-0.21
-0.48
-0.23
0.63
-0.19
-0.66
-0.28
-0.18
0.18
-0.01
0.06
-0.50
0.20
0.94
-0.11
-0.97
0.47
-0.09
-1.25
-0.10
-0.02
-0.49
-0.21
-0.42
-0.49
-0.48
-0.14
-0.41
-0.20
0.01
-0.10
0.01
0.01
-0.40
-0.32
-0.27
0.09
-0.57
0.05
0.07
-0.09
0.12
2.93
-0.34
0.19
LasVegasSands LVS 60.71 0.43
Lazard
LAZ 42.20 -0.33
Lear
LEA 144.31 0.79
Leggett&Platt LEG 45.27 0.31
Leidos
LDOS 56.62 0.72
Lennar A
LEN 50.49 -0.43
Lennar B
LEN/B 41.83 -0.66
LennoxIntl LII 161.24 -0.95
LeucadiaNatl LUK 23.69 -0.35
Level3Comm LVLT 54.92 -0.10
LibertyProperty LPT 41.81 0.16
EliLilly
LLY 78.55 -0.29
LincolnNational LNC 67.16 -0.74
LionsGate A LGF/A 29.04 -0.20
LionsGate B LGF/B 27.41 -0.37
LiveNationEnt LYV 38.90 -0.04
LloydsBanking LYG 3.33 -0.02
LockheedMartin LMT 308.14 4.53
Loews
L
46.62 -0.28
Lowe's
LOW 73.45 -0.35
LyondellBasell LYB 89.60 -0.72
M&T Bank MTB 150.13 -1.87
MGM Resorts MGM 32.04 0.35
MPLX
MPLX 33.84 0.24
MSCI
MSCI 113.08 -0.91
t Macerich
MAC 52.75 -0.33
MacquarieInfr MIC 72.57 0.13
Macy's
M
20.94 -0.22
MagellanMid MMP 66.03 0.06
MagnaIntl MGA 46.36 -0.45
Manpower MAN 109.21 -0.53
ManulifeFin MFC 19.62 -0.06
MarathonOil MRO 10.88 -0.04
MarathonPetrol MPC 51.43 -1.09
Markel
MKL 1034.73 -5.51
Marsh&McLennan MMC 77.00 -0.44
MartinMarietta MLM 202.82 2.47
Masco
MAS 36.31 0.01
Mastercard MA 133.84 -0.01
McCormick MKC 95.36 0.71
McCormickVtg MKC/V 95.33 0.40
McDonalds MCD 159.38 -0.29
McKesson MCK 147.21 -1.12
Medtronic MDT 79.72 0.13
Merck
MRK 63.12 -0.20
MetLife
MET 46.73 -0.84
MettlerToledo MTD 591.96 -2.10
MichaelKors KORS 42.32 -0.14
MidAmApt MAA 105.78 -0.55
MitsubishiUFJ MTU 6.01 0.02
MizuhoFin MFG 3.43 0.01
MobileTeleSys MBT 9.36 0.21
Mobileye
MBLY 63.10 -0.13
MohawkIndustries MHK 248.57 1.45
MolsonCoors B TAP 89.39 0.31
Monsanto MON 116.59 -0.05
Moody's
MCO 133.03 0.35
MorganStanley MS 45.35 -0.13
Mosaic
MOS 19.94 -0.13
MotorolaSolutions MSI 86.94 -0.36
NRG Energy NRG 24.95 0.38
NTTDoCoMo DCM 23.22 0.03
NVR
NVR 2645.36-24.64
NationalGrid NGG 63.22 -0.35
NatlOilwell NOV 30.36 0.02
NatlRetailProp NNN 40.88 -0.06
NewOrientalEduc EDU 78.31 1.63
NY CmntyBcp NYCB 11.99 -0.02
NewellBrands NWL 47.59 -0.36
NewmontMining NEM 38.04 -0.26
s NextEraEnergy NEE 150.72 -0.16
NielsenHoldings NLSN 39.07 -0.29
Nike
NKE 52.73 -1.00
NiSource
NI
26.98 -0.11
NobleEnergy NBL 23.58 0.17
Nokia
NOK 6.20 -0.01
NomuraHoldings NMR 5.57 0.03
Nordstrom JWN 44.54 -0.52
NorfolkSouthern NSC 119.40 1.64
NorthropGrumman NOC 270.72 2.82
Novartis
NVS 83.62 0.29
NovoNordisk NVO 46.51 -0.29
Nucor
NUE 54.93 0.35
NuSTAREnergy NS 39.15 0.15
OGE Energy OGE 36.18 -0.23
ONEOK
OKE 53.22 0.27
OccidentalPetrol OXY 59.08 -0.05
Och-Ziff
OZM 2.86 -0.03
OmegaHealthcare OHI 31.24 0.15
t Omnicom OMC 72.83 -0.36
Oracle
ORCL 49.45 0.21
Orange
ORAN 17.05 0.11
OrbitalATK OA 108.93 1.58
Orix
IX
80.35 -0.27
Oshkosh
OSK 72.44 0.40
OwensCorning OC 70.19 -0.21
s PG&E
PCG 70.26 -0.05
PLDT
PHI 33.59 -0.81
PNC Fin
PNC 126.27 -1.28
POSCO
PKX 74.75 0.48
PPG Ind
PPG 103.86 -0.29
PPL
PPL 39.38 -0.15
PVH
PVH 126.62 0.39
PackagingCpAm PKG 108.50 -0.56
PaloAltoNtwks PANW 130.08 0.80
ParkHotels PK 25.98 0.14
ParkerHannifin PH 159.20 0.79
t ParsleyEnergy PE 24.37 -0.33
Pearson
PSO 7.89 -0.06
PembinaPipeline PBA 31.55 0.01
Pentair
PNR 61.06 0.11
PepsiCo
PEP 115.84 0.30
PerkinElmer PKI 65.88 0.17
Perrigo
PRGO 77.65 -0.72
PetroChina PTR 64.10 -0.01
PetroleoBrasil PBR 9.05 -0.03
PetroleoBrasilA PBR/A 8.71 -0.02
Pfizer
PFE 33.50 0.03
PhilipMorris PM 116.55 1.01
Phillips66 PSX 83.50 -0.15
PinnacleFoods PF 58.66 -0.39
s PinnacleWest PNW 90.41 -0.03
t PioneerNatRscs PXD 127.96 -0.50
PlainsAllAmPipe PAA 20.63 0.14
PlainsGP
PAGP 21.43 0.26
PolarisIndustries PII 94.49 0.82
PostHoldings POST 82.40 0.30
Potash
POT 17.26 0.10
Praxair
PX 130.88 -1.20
PrincipalFin PFG 62.66 -0.66
Procter&Gamble PG 92.32 -0.15
Progressive PGR 47.63 0.32
Prologis
PLD 62.18 -0.25
PrudentialFin PRU 101.32 -1.36
Prudential PUK 46.48 -0.30
PublicServiceEnt PEG 47.11 -0.19
PublicStorage PSA 205.57 1.27
PulteGroup PHM 25.31 0.01
QuestDiag DGX 106.79 -0.25
QuintilesIMS Q
96.00 0.45
RELX
RENX 20.78 0.03
RELX
RELX 21.78 0.03
RPM
RPM 48.68 -0.09
RalphLauren RL 86.83 -0.40
RaymondJames RJF 77.54 -0.88
s Raytheon RTN 182.11 3.87
RealtyIncome O
57.14 -0.07
RedHat
RHT 105.52 -0.07
RegencyCtrs REG 63.38 -0.96
RegionsFin RF 14.16 -0.13
ReinsuranceGrp RGA 133.65 -0.79
RenaissanceRe RNR 141.38 -0.63
RepublicServices RSG 64.88 0.49
ResMed
RMD 74.95 -0.59
RestaurantBrands QSR 60.73 -0.61
RiceEnergy RICE 26.77 0.15
s RioTinto
RIO 48.11 0.08
Mutual Funds | WSJ.com/fundresearch
Explanatory Notes
Fund
Data provided by
Top 250 mutual-funds listings for Nasdaq-published share classes with net assets of at least
$500 million each. NAV is net asset value. Percentage performance figures are total returns,
assuming reinvestment of all distributions and after subtracting annual expenses. Figures don’t
reflect sales charges (“loads”) or redemption fees. NET CHG is change in NAV from previous
trading day. YTD%RET is year-to-date return. 3-YR%RET is trailing three-year return
annualized.
e-Ex-distribution. f-Previous day’s quotation. g-Footnotes x and s apply. j-Footnotes e and s
apply. k-Recalculated by Lipper, using updated data. p-Distribution costs apply, 12b-1. rRedemption charge may apply. s-Stock split or dividend. t-Footnotes p and r apply. v-Footnotes
x and e apply. x-Ex-dividend. z-Footnote x, e and s apply. NA-Not available due to incomplete
price, performance or cost data. NE-Not released by Lipper; data under review. NN-Fund not
tracked. NS-Fund didn’t exist at start of period.
Fund
Tuesday, August 29, 2017
Net YTD
Net YTD
NAV Chg % Ret Fund
NAV Chg % Ret Fund
AggBdInst
CorBdInst
A
American Century Inv
42.14
Ultra
American Funds Cl A
AmcpA p
29.50
AMutlA p
39.46
26.62
BalA p
13.03
BondA p
62.01
CapIBA p
CapWGrA
49.83
54.20
EupacA p
59.90
FdInvA p
48.04
GwthA p
10.41
HI TrA p
ICAA p
38.99
22.76
IncoA p
42.56
N PerA p
43.65
NEcoA p
63.07
NwWrldA
53.27
SmCpA p
13.05
TxExA p
43.16
WshA p
B
Baird Funds
+0.14 20.8
+0.05
+0.04
+0.02
+0.02
-0.07
-0.09
-0.20
+0.03
+0.06
-0.01
+0.05
-0.03
-0.02
+0.03
-0.08
-0.04
+0.01
+0.03
9.9
8.2
8.5
3.7
9.4
15.0
22.7
11.8
14.3
5.1
8.5
6.6
20.5
21.4
22.6
15.9
4.6
8.9
10.96
11.31
BlackRock Funds A
19.90
GlblAlloc p
BlackRock Funds Inst
21.87
EqtyDivd
20.02
GlblAlloc
7.79
HiYldBd
StratIncOpptyIns 9.93
Bridge Builder Trust
CoreBond
10.27
4.1 US Small
4.4 US SmCpVal
-0.04
9.5 USLgVa
Dodge & Cox
106.18 -0.01 5.4
6.6 Balanced
13.45 -0.02 12.9
9.7 GblStock
13.89 +0.01 3.8
5.9 Income
44.96 -0.19 18.0
3.3 Intl Stk
192.04 -0.10 6.4
Stock
4.1 DoubleLine Funds
10.80 +0.01 3.9
TotRetBdI
10.79 +0.01 3.7
TotRetBdN
-0.04
-0.04
...
...
+0.01
D
Del Invest Instl
Value
20.10
Dimensional Fds
11.06
5GlbFxdInc
30.13
EmgMktVa
EmMktCorEq 21.92
13.58
IntlCoreEq
18.89
IntlVal
20.58
IntSmCo
IntSmVa
22.45
US CoreEq1
20.70
US CoreEq2 19.60
Net YTD
NAV Chg % Ret
+0.01
+0.01
US TgdVal
+0.01
3.0
+0.01
-0.05
-0.02
-0.07
-0.10
-0.10
-0.13
+0.01
+0.01
2.6
26.1
27.0
18.0
14.7
19.9
18.3
8.2
6.1
33.35
35.45
23.02
36.75
+0.01 -1.0
+0.03 -5.0
+0.01 -3.6
-0.05 5.7
E
Edgewood Growth Instituti
EdgewoodGrInst 28.18 +0.02 26.9
F
Federated Instl
StraValDivIS
Net
Sym Close Chg
6.32 -0.01
9.3
Fidelity
85.82 +0.09 10.7
500IdxInst
500IdxInstPrem 85.82 +0.09 10.7
500IdxPrem 85.81 +0.08 10.7
ExtMktIdxPrem r
IntlIdxPrem r
TMktIdxF r
TMktIdxPrem
USBdIdxInstPrem
Net
Sym Close Chg
Stock
RobertHalf RHI 44.45
Rockwell
ROK 160.38
s RockwellCollins COL 130.74
RogersComm B RCI 51.72
Rollins
ROL 44.29
RoperTech ROP 229.47
RoyalBkCanada RY 74.09
RoyalBkScotland RBS 6.57
RoyalCaribbean RCL 120.33
RoyalDutchA RDS/A 55.44
RoyalDutchB RDS/B 56.85
SAP
SAP 104.78
S&P Global SPGI 150.92
SINOPECShanghai SHI 60.79
SK Telecom SKM 25.59
SLGreenRealty SLG 96.16
Salesforce.com CRM 93.83
Sanofi
SNY 48.96
Sasol
SSL 29.91
Scana
SCG 59.94
Schlumberger SLB 63.50
SchwabC
SCHW 39.18
ScottsMiracleGro SMG 94.18
SealedAir SEE 43.99
SempraEnergy SRE 118.78
SensataTech ST 44.21
ServiceCorp SCI 35.26
ServiceMaster SERV 45.64
ServiceNow NOW 111.75
ShawComm B SJR 22.07
SherwinWilliams SHW 333.14
ShinhanFin SHG 46.10
Shopify
SHOP 104.37
SimonProperty SPG 156.25
SmithAO
AOS 54.33
Smith&Nephew SNN 35.80
Smucker
SJM 104.70
Snap
SNAP 14.99
SnapOn
SNA 145.70
SOQUIMICH SQM 47.00
Sony
SNE 38.64
Southern
SO 48.18
SoCopper SCCO 41.41
SouthwestAirlines LUV 51.46
SpectraEnerPtrs SEP 43.89
SpectrumBrands SPB 107.52
SpiritAeroSys SPR 72.65
Sprint
S
8.27
Square
SQ 25.04
StanleyBlackDck SWK 139.01
StarwoodProp STWD 21.98
StateStreet STT 92.00
Statoil
STO 18.68
Steris
STE 85.46
STMicroelec STM 17.02
Stryker
SYK 139.41
SumitomoMits SMFG 7.42
SunCommunities SUI 88.98
SunLifeFinancial SLF 38.39
SuncorEnergy SU 31.53
SunTrustBanks STI 55.12
SynchronyFin SYF 30.12
Syngenta SYT 92.01
Sysco
SYY 52.29
TAL Education TAL 29.26
TE Connectivity TEL 78.53
Telus
TU 36.00
Ternium
TX 30.33
TIM Part
TSU 18.02
TJX
TJX 71.49
TableauSoftware DATA 71.52
TaiwanSemi TSM 36.88
TargaResources TRGP 43.44
Target
TGT 54.55
TataMotors TTM 29.68
TechnipFMC FTI 25.61
TeckRscsB TECK 25.23
TelecomArgentina TEO 30.68
TelecomItalia TI
9.52
TelecomItalia A TI/A 7.71
Teleflex
TFX 205.61
TelefonicaBras VIV 15.56
Telefonica TEF 10.82
TelekmIndonesia TLK 35.56
Tenaris
TS 26.89
Teradyne
TER 35.02
t TevaPharm TEVA 15.77
Textron
TXT 48.16
ThermoFisherSci TMO 180.52
ThomsonReuters TRI 45.22
ThorIndustries THO 107.37
3M
MMM 202.92
Tiffany
TIF 88.28
TimeWarner TWX 101.38
Toll Bros
TOL 37.85
Torchmark TMK 76.81
Toro
TTC 60.30
TorontoDomBk TD 51.66
Total
TOT 51.83
s TotalSystem TSS 67.77
ToyotaMotor TM 112.08
TransCanada TRP 50.26
TransDigm TDG 274.75
TransUnion TRU 46.73
Travelers
TRV 123.01
TurkcellIletism TKC 9.60
TurquoiseHill TRQ 3.32
Twitter
TWTR 16.93
TylerTech TYL 169.05
TysonFoods TSN 62.18
UBS Group UBS 16.55
UDR
UDR 38.72
UGI
UGI 49.59
US Foods USFD 26.95
UltraparPart UGP 23.24
t UnderArmour A UAA 16.43
t UnderArmour C UA 15.34
Unilever
UN 59.49
Unilever
UL 58.12
UnionPacific UNP 104.97
UnitedContinental UAL 62.89
UnitedMicro UMC 2.47
UPS B
UPS 114.89
UnitedRentals URI 114.94
US Bancorp USB 51.50
US Steel
X
25.96
UnitedTech UTX 118.70
s UnitedHealth UNH 196.73
UniversalHealthB UHS 106.93
UnumGroup UNM 47.93
VEREIT
VER 8.38
VF
VFC 63.06
Visa
V
103.77
VailResorts MTN 219.41
Vale
VALE 10.85
ValeantPharm VRX 13.24
ValeroEnergy VLO 67.92
Vantiv
VNTV 71.25
VarianMed VAR 102.89
Vectren
VVC 65.80
Vedanta
VEDL 18.93
VeevaSystems VEEV 57.13
Ventas
VTR 67.79
Verizon
VZ 48.51
VistraEnergy VST 17.71
VMware
VMW 104.93
VornadoRealty VNO 74.16
VoyaFinancial VOYA 37.69
VulcanMaterials VMC 116.50
WABCO
WBC 139.67
s WEC Energy WEC 65.26
W.P.Carey WPC 67.73
Wabtec
WAB 70.68
Wal-Mart WMT 78.77
WasteConnections WCN 65.70
s WasteMgt WM 76.75
Waters
WAT 180.33
58.31
...
41.29 -0.25
70.63 +0.06
70.62 +0.06
11.70 +0.01
Fidelity Advisor I
31.21 +0.05
NwInsghtI
Fidelity Freedom
16.21 -0.01
FF2020
FF2025
13.98 -0.02
17.40 -0.02
FF2030
FreedomK2020 15.08 -0.01
FreedomK2025 15.89 -0.02
FreedomK2030 16.39 -0.02
FreedomK2035 17.18 -0.03
FreedomK2040 17.21 -0.03
Fidelity Invest
Balanc
24.03 +0.02
BluCh
83.21 +0.12
118.30 +0.27
Contra
118.28 +0.27
ContraK
CpInc r
10.11
...
DivIntl
39.65 -0.24
168.87 +0.19
GroCo
168.79 +0.18
GrowCoK
InvGB
7.97 +0.01
InvGrBd
11.36 +0.01
54.04 -0.35
LowP r
LowPriStkK r 54.02 -0.35
98.40 +0.24
MagIn
106.01 +0.12
OTC
22.68 +0.03
Puritn
NA
...
SrsEmrgMktF
NA
...
SrsInvGrdF
10.75 +0.01
TotalBond
Fidelity Selects
219.37 +1.00
Biotech r
First Eagle Funds
58.55 -0.01
GlbA
FPA Funds
33.88 +0.02
FPACres
FrankTemp/Frank Adv
IncomeAdv
2.32
...
FrankTemp/Franklin A
7.53 +0.01
CA TF A p
6.3
17.0
9.9
9.9
3.5
Wayfair
W 68.29
WellCareHealth WCG 167.36
WellsFargo WFC 51.42
Welltower HCN 71.93
WestPharmSvcs WST 85.08
WestarEnergy WR 51.53
WesternGasEquity WGP 39.42
WesternGasPtrs WES 49.52
WesternUnion WU 19.07
s WestlakeChem WLK 74.82
WestpacBanking WBK 25.00
WestRock WRK 55.26
Weyerhaeuser WY 31.52
WheatonPrecMetals WPM 20.66
Whirlpool WHR 168.02
Williams
WMB 29.17
WilliamsPartners WPZ 38.07
Wipro
WIT 5.92
WooriBank WF 50.25
Workday
WDAY 104.41
Wyndham WYN 96.65
XPO Logistics XPO 59.76
s XcelEnergy XEL 49.50
Xerox
XRX 32.24
Xylem
XYL 61.11
YPF
YPF 20.32
YumBrands YUM 76.09
YumChina YUMC 35.18
ZTO Express ZTO 13.43
ZayoGroup ZAYO 33.99
ZimmerBiomet ZBH 112.82
Zoetis
ZTS 61.50
0.35
0.81
2.75
0.12
-0.53
-0.53
-0.36
-0.09
-0.43
...
...
-0.59
-1.07
0.47
-0.26
-0.67
0.17
-0.06
-0.07
-0.65
0.05
-0.36
-0.12
-0.27
-0.43
0.07
0.10
-0.27
-0.16
0.05
-5.78
-1.05
0.58
-0.58
0.16
-0.07
-0.70
-0.20
0.94
-0.20
0.16
-0.17
-0.36
-0.29
0.27
0.10
0.94
-0.02
0.13
0.34
-0.17
-0.90
0.03
0.24
-0.21
-0.16
0.03
-0.69
0.16
0.37
-0.25
-0.17
0.02
0.15
1.23
0.76
0.13
-0.29
0.02
-0.31
-0.16
0.11
0.16
0.11
-0.14
0.11
0.21
-0.42
-0.27
-0.08
-1.77
-0.02
-0.01
-0.15
-0.03
0.16
-0.16
0.07
2.09
-0.14
-1.34
0.46
-1.07
-0.32
-0.03
-0.40
-0.39
-0.06
0.04
0.27
-0.19
0.10
3.67
-0.33
-0.22
0.06
0.09
0.16
0.01
-0.37
-0.15
-0.21
0.18
-0.13
-0.05
-0.50
-0.44
0.02
...
1.03
-0.26
...
1.10
4.23
-0.46
0.66
3.37
1.64
-2.14
-0.34
-0.04
-0.16
-0.01
0.76
0.03
-0.99
-0.50
-0.49
...
-0.79
-0.23
...
0.28
-0.10
-0.05
0.25
-0.29
-0.30
0.56
0.69
-0.12
-0.08
0.22
0.74
0.73
0.49
0.39
Net YTD
NAV Chg % Ret Fund
Net
Sym Close Chg
Stock
-0.27 AthenaHealth ATHN 138.05
-0.86 Atlassian
TEAM 34.61
-0.21 Autodesk
ADSK 111.27
0.69 ADP
ADP 105.12
0.38 Baidu
BIDU 220.69
-0.31 BankofOzarks OZRK 42.10
-0.49 Biogen
BIIB 293.58
0.24 BioMarinPharm BMRN 82.98
0.03 Bioverativ BIVV 56.56
-0.02 t BrighthouseFin BHF 55.76
-0.21 Broadcom AVGO 241.73
0.09 CA
CA 32.67
-0.25 CBOE Holdings CBOE 100.34
0.39 CDK Global CDK 62.59
-0.17 CDW
CDW 61.58
... CH Robinson CHRW 71.57
0.18 CME Group CME 126.38
-0.02 CSX
CSX 49.78
-0.25 s CadenceDesign CDNS 37.91
0.91 Carlyle
CG 20.75
0.34 Celgene
CELG 132.44
1.05 Cerner
CERN 65.27
-0.04 CharterComms CHTR 388.82
-0.07 CheckPointSftw CHKP 109.05
0.13 ChinaLodging HTHT 107.15
-0.37 CincinnatiFin CINF 76.78
-0.12 Cintas
CTAS 132.97
-0.47 CiscoSystems CSCO 31.48
0.14 CitrixSystems CTXS 76.42
-0.23 Cognex
CGNX 105.87
-0.07 CognizantTech CTSH 69.65
-0.04 Coherent
COHR 221.64
NASDAQ
AGNC Invt AGNC 21.20
Ansys
ANSS 126.57
ASML
ASML 155.15
Abiomed
ABMD 145.39
ActivisionBliz ATVI 63.48
AdobeSystems ADBE 152.14
AkamaiTech AKAM 45.71
AlexionPharm ALXN 138.38
AlignTech ALGN 173.99
Alkermes ALKS 49.16
AlnylamPharm ALNY 82.52
Alphabet A GOOGL 935.75
Alphabet C GOOG 921.29
Altaba
AABA 63.17
Amazon.com AMZN 954.06
Amdocs
DOX 63.91
Amerco
UHAL 367.41
AmericanAirlines AAL 44.56
Amgen
AMGN 172.23
AnalogDevices ADI 79.55
s Apple
AAPL 162.91
AppliedMaterials AMAT 44.02
ArchCapital ACGL 96.40
Net
Sym Close Chg
Stock
-0.29
-1.07
1.03
-2.51
0.73
0.35
0.57
-0.64
-1.12
-0.96
-0.68
7.62
7.48
-0.36
8.04
0.18
5.78
-0.39
0.45
0.11
1.44
0.39
0.04
Comcast A CMCSA 40.16
CommerceBcshrs CBSH 54.48
CommScope COMM 32.78
Copart
CPRT 31.45
CoStarGroup CSGP 282.46
Costco
COST 153.56
Ctrip.com CTRP 52.16
CyrusOne CONE 62.34
DISH Network DISH 57.77
DentsplySirona XRAY 55.70
DexCom
DXCM 75.23
DiamondbackEner FANG 88.17
DiscoveryComm A DISCA 22.45
t DiscoveryComm C DISCK 21.18
DollarTree DLTR 79.70
E*TRADE ETFC 40.67
EastWestBancorp EWBC 55.12
eBay
EBAY 35.20
EchoStar
SATS 58.52
s ElbitSystems ESLT 137.32
ElectronicArts EA 119.23
Equinix
EQIX 466.24
Ericsson
ERIC 5.85
ErieIndemnity A ERIE 120.06
Exelixis
EXEL 27.56
Net
Sym Close Chg
Stock
EXPE 143.99
-0.63 Expedia
-0.07 ExpeditorsIntl EXPD 55.90
-0.21 ExpressScripts ESRX 61.38
0.36 F5Networks FFIV 117.74
FB 168.05
0.70 Facebook
FAST 41.41
-0.29 Fastenal
1.28 FifthThirdBncp FITB 26.26
FISV 123.02
0.40 Fiserv
FLEX 15.97
0.07 Flex
FTNT 37.36
0.42 Fortinet
-1.52 Gaming&Leisure GLPI 38.12
GRMN 51.49
0.06 Garmin
0.19 GileadSciences GILD 75.74
GT 30.20
-0.29 Goodyear
GRFS 20.07
0.21 Grifols
0.52 HD Supply HDS 32.15
HAS 94.83
-0.55 Hasbro
0.48 HenrySchein HSIC 168.43
HOLX 37.77
0.14 Hologic
JBHT 100.06
-0.20 JBHunt
0.79 HuntingtonBcshs HBAN 12.59
0.64 IAC/InterActive IAC 105.30
IDXX 150.32
-0.41 IdexxLab
0.02 IHSMarkit INFO 46.40
0.84 IPG Photonics IPGP 169.81
-0.31 IcahnEnterprises IEP 51.01
ICLR 111.99
-0.89 s Icon
ILMN 195.94
-0.06 Illumina
INCY 124.97
0.82 Incyte
INTC 34.73
0.40 Intel
-0.31 InteractiveBrkrs IBKR 41.79
INTU 138.01
-2.09 Intuit
-0.18 IntuitiveSurgical ISRG 987.40
-0.25 IonisPharma IONS 48.86
JD 40.84
-0.12 JD.com
0.06 JackHenry JKHY 101.08
1.09 JazzPharma JAZZ 145.86
JBLU 19.71
1.01 JetBlue
-0.01 KLA Tencor KLAC 92.39
-0.03 KitePharma KITE177.95
1.11 KraftHeinz KHC 81.44
LKQ 33.92
0.54 LKQ
-0.22 LamResearch LRCX 162.32
0.14 LamarAdvertising LAMR 65.71
-0.36 LibertyBroadbandA LBRDA 98.80
-0.34 LibertyBroadbandC LBRDK 99.05
-0.68 LibertyGlobal A LBTYA 33.59
-0.36 LibertyGlobal C LBTYK 32.59
-0.06 LibertyLiLAC A LILA 25.98
0.39 LibertyLiLAC C LILAK 25.58
0.12 LibertyQVC B QVCB 22.00
1.61 LibertyQVC A QVCA 21.99
0.50 LibertyVenturesA LVNTA 59.27
3.33 LibertyFormOne A FWONA 36.44
-0.09 LibertyFormOne C FWONK 37.84
-1.66 LibertyBraves A BATRA 23.67
0.24 LibertyBraves C BATRK 23.73
Dividend Changes
PSEC
10.5 .06 /.08333 M
DHF
FCOR
FLTB
FBND
8.0
2.8
1.7
2.5
.0235
.121
.071
.107
M
M
M
M
Sep26 /Sep12
Sep05 /Aug31
Sep05 /Aug31
Sep05 /Aug31
NYSE highs - 69
AXIS CapPfdE AXSpE 25.45
15.80
AcornIntl
ATV
63.63
AgilentTechs
A
43.18
Alcoa
AA
77.31
Allete
ALE
43.23
AlliantEnergy LNT
60.79
Ameren
AEE
74.29
AEP
AEP
AmerTowerPfdB AMTpB 129.26
AmerTowerREIT AMT 146.63
80.33
Amphenol
APH
AnnalyCapPfdE NLYpE 25.89
AnnalyCapPfdF NLYpF 25.07
ApolloGlMgmtPfdA APOpA 26.43
89.00
AtmosEnergy ATO
BankofAmPfdL BACpL1317.00
30.86
CAI Intl
CAI
48.91
CMS Energy
CMS
17.26
CPFLEnergia
CPL
13.75
CallawayGolf ELY
41.37
Catalent
CTLT
30.12
CenterPointEner CNP
CharlesRiverLabs CRL 106.64
Coresite
COR 118.49
CostamarePfdC CMREpC 25.15
CrownCastlePfdA CCIpA 1109.99
112.58
DTE Energy
DTE
DellTechnologies DVMT 73.28
87.95
DukeEnergy
DUK
EmbotellAndinaB AKO/B 29.30
EnelAmericas ENIA 10.79
6.07
EnelChile
ENIC
EnelGenChile EOCC 25.95
63.67
EversourceEner ES
FarmlandPtrsPfdB FPIpB 27.24
82.66
Franco-Nevada FNV
GuidewireSoftware GWRE 74.43
44.44
HalyardHealth HYH
Humana
HUM 255.91
6.59
IamGold
IAG
InvescoMtg7.5%PfdC IVRpC 25.17
iStarPfdD
STARpD 25.51
21.80
Kemet
KEM
12.70
KirklandLakeGold KL
40.15
KnightTransport KNX
NextEraEnergy NEE 151.28
NorthwestNatGas NWN 66.55
76.06
ONE Gas
OGS
13.91
OsiskoGoldRoyal OR
70.58
PG&E
PCG
PennyMacPfdB PMTpB 25.24
29.23
PharMerica
PMC
PinnacleWest PNW 90.87
PublicStoragePfdG PSApG 25.15
Raytheon
RTN 182.25
48.29
RioTinto
RIO
RockwellCollins COL 135.31
SwiftTransport SWFT 28.84
TPGPace
TPGH/U 10.44
TexasPacLand TPL 389.02
67.82
TotalSystem
TSS
24.74
Triple-S Mgmt GTS
UnitedHealth UNH 197.04
65.71
WEC Energy WEC
76.85
WasteMgt
WM
16.41
WstAstIncoFd PAI
75.25
WestlakeChem WLK
49.70
XcelEnergy
XEL
Net YTD
NAV Chg % Ret Fund
Fed TF A p
IncomeA p
RisDv A p
-0.2
-2.2
...
2.0
...
...
-0.2
-0.2
-0.2
0.1
0.5
0.7
...
0.2
-0.6
0.4
0.6
0.2
-0.3
-0.1
13.9
-0.1
0.6
1.2
-0.8
1.1
...
0.2
0.1
-0.6
0.9
2.6
1.4
...
-0.6
0.3
0.3
0.9
0.2
1.3
0.2
...
2.6
1.6
2.7
-0.1
-0.1
0.1
0.6
-0.1
0.5
0.3
...
0.4
2.2
0.2
2.1
2.8
2.5
0.7
0.4
0.7
0.8
-0.2
0.6
1.3
...
-0.1
YuMe
YUME
4.95 -4.8
6.00 8.7 VitaminShoppe VSI
WellsFargoPfdJ WFCpJ 25.47 -0.2
48.95 0.6
WescoIntl
WCC
17.98 -1.4
13.48 1.5
39.96 -1.4
17.66 -0.7
38.35 -1.2
2.50 ...
14.31 -0.1
40.60 ...
2.66 0.4
14.40 -0.1
23.35 -2.7
31.61 -1.3
16.24 1.0
2.59 -1.1
9.61 -1.1
11.66 0.1
3.55 -0.3
32.20 -1.3
7.89 1.0
32.29 -0.3
106.73 -0.4
86.78 -0.1
14.53 7.4
15.82 5.3
6.46 0.7
81.99 -0.3
2.72 1.1
8.15 -0.6
18.64 -2.1
24.28 -0.1
14.80 -1.7
42.66 -0.8
48.40 -0.7
37.37 -0.4
30.81 -0.3
9.55 -15.8
0.85 9.0
52.46 -0.6
22.88 -1.4
62.55 -1.1
11.36 -0.6
10.80 -5.3
8.14 ...
9.81 -0.6
6.70 -1.1
72.61 -0.5
23.87 -1.3
125.46 -0.4
2.44 -0.8
0.83 -4.3
29.31 -0.5
12.55 -2.5
3.96 -0.7
19.89 -4.7
35.27 -0.3
46.60 -2.4
7.91 0.5
19.22 -2.3
9.75 -0.5
4.24 -1.6
23.33 -1.4
19.67 0.1
15.45 -1.0
27.07 -0.8
17.14 -0.9
15.05 -2.8
16.13 -3.0
NYSE Arca highs - 57
ALPSMedBreak SBIO
ARKGenomicRev ARKG
ARKInnovationETF ARKK
ARKWebx.0ETF ARKW
CSOPFTSEChinaA50 AFTY
CurrShEuro
FXE
CurrShSEK
FXS
DeutscheXFTSEEmCmp DEMG
DirexEMBdBull3X EMBU
DirexNatGasBr3 GASX
DirexUtilBl3X UTSL
ETFMG DroneEcon IFLY
ElemntsRogrMtls RJZ
ETFS PlldmShr PALL
First Tr Instl Pfd FPEI
FlexShSelBdFd BNDC
GlbXCopperMiners COPX
GlbX FTSEAndean40 AND
GlbXNextEmerging EMFM
GuggChinaRE TAO
HartfordMultiEM ROAM
iPathBloomCopperTR JJC
iPathBlmIndMetalTR JJM
iPathPBAluminum FOIL
iShU.S.Utilities IDU
iShEmgMktDividend DVYE
iShMSCIAllPeruCap EPU
iShMSCIJapanSC SCJ
iShMSCIThailandCap THD
KraneEFdChina KCNY
MSMktVectRupee INR
PIMCOEnhShMaturity MINT
PwrShCNYDimSum DSUM
PwrShDBBaseMtls DBB
PwrShDB USDBear UDN
PwrShIntlCorpBd PICB
PwrShS&PEMLowVol EELV
ProShUlt Euro ULE
SPDRBloomBarEMLoBd EBND
SPDRBloomBarInCpBd IBND
SPDRBloomBarSTInTr BWZ
SPDRCitiIntGovBd WIP
SPDREMFossilFuelFr EEMX
SPDREmMktsDiv EDIV
SprottPhysPlatinum SPPP
USGlbGOGold GOAU
USCopperIndex CPER
UtilitiesSelSector XLU
VanEckAfrica AFK
VanEckEM AggBd EMAG
VanEckGreenBd GRNB
VanEckIntlHYBd IHY
VanEckJPMEMLCBd EMLC
VanEckUranium NLR
VangdUtilities VPU
WBITacticalIncome WBII
WisdTrChineseYuan CYB
M
H
3.2
3.4
3.4
8.4
19.8
4.9
5.1
O
I
J
P
6.1
9.2
20.5
11.6
NA
18.3
29.98
24.32
32.91
39.66
17.22
116.28
121.07
29.05
25.88
47.19
31.20
34.12
8.70
90.79
20.15
25.22
26.49
9.76
23.36
27.80
24.85
35.55
28.59
28.85
138.56
42.74
37.58
72.95
82.90
34.77
43.10
101.82
23.46
18.34
22.65
27.45
25.20
17.83
30.04
35.37
32.53
58.33
67.16
31.72
8.81
13.65
20.00
55.42
24.29
21.97
27.35
25.73
19.40
53.21
121.58
25.65
25.65
0.2
1.0
1.5
1.2
...
-0.1
0.5
1.2
0.3
0.5
1.1
0.2
0.7
0.6
0.2
...
0.6
0.6
0.2
0.5
...
0.3
-0.1
0.7
-0.1
0.1
-0.2
-0.1
2.3
0.5
1.0
...
0.2
0.3
-0.3
-0.1
...
-0.1
-0.1
-0.2
-0.2
0.6
1.4
...
0.6
0.8
0.5
-0.2
...
0.3
0.3
...
-0.1
0.6
-0.1
0.1
0.4
NYSE Arca lows - 20
DirexGoldMinBr3 DUST
DirexNatGasBl3 GASL
ElemntsGrain GRU
FT NaturalGas FCG
GlbXMSCIPakistan PAK
iPathBloomAgriTR JJA
Net YTD
NAV Chg % Ret Fund
12.08 +0.01 3.5
2.34
... 4.8
56.41 +0.04 7.8 Metropolitan West
FrankTemp/Franklin C
10.74 +0.01
TotRetBd
2.37
... 4.8 TotRetBdI
Income C t
10.74 +0.01
FrankTemp/Temp A
10.10
...
TRBdPlan
16.9 GlBond A p
12.02
... 2.0 MFS Funds Class I
Growth A p
25.96 -0.12 10.2 ValueI
38.97 -0.01
9.9 FrankTemp/Temp Adv
MFS Funds Instl
10.4 GlBondAdv p 11.98 +0.01 2.2 IntlEq
24.27 -0.18
12.1
Mutual Series
9.9
32.08 -0.14
GlbDiscA
10.6 Harbor Funds
32.72 -0.15
GlbDiscz
12.1 CapApInst
70.23 +0.19 24.0
13.1 IntlInst r
68.08 -0.23 16.6
13.2 Harding Loevner
Oakmark Funds Invest
IntlEq
NA
... NA EqtyInc r
32.29 +0.03
10.0
79.12
...
Oakmark
23.5
OakmrkInt
27.35 -0.30
20.9
Invesco Funds A
Old Westbury Fds
21.0
10.89 -0.01 3.9 LrgCpStr
EqIncA
14.32 -0.01
7.9
Oppenheimer Y
19.1
NA
...
DevMktY
23.5
41.03 -0.32
IntGrowY
23.5 John Hancock Class 1
LSBalncd
15.51
...
9.5
3.7
16.42 -0.01 11.7
4.1 LSGwth
Parnassus Fds
9.2 John Hancock Instl
DispValMCI
22.50 -0.04 4.8 ParnEqFd
41.91 +0.07
9.3
PIMCO Fds Instl
14.0 JPMorgan Funds
38.21 -0.12 5.0 AllAsset
NA
...
27.2 MdCpVal L
TotRt
10.37 +0.02
11.0 JPMorgan I Class
11.72 -0.01 3.9 PIMCO Funds A
NA CoreBond
12.42
...
IncomeFd
NA JPMorgan R Class
11.73 -0.01 3.9 PIMCO Funds D
3.9 CoreBond
12.42
...
IncomeFd
PIMCO Funds Instl
26.0
Lazard Instl
IncomeFd
12.42
...
19.23 -0.03 21.1 PIMCO Funds P
7.9 EmgMktEq
Loomis Sayles Fds
12.42
...
IncomeP
14.25
... 6.9 Price Funds
5.1 LSBondI
Lord Abbett A
90.22 +0.20
BlChip
28.86 -0.01
... 2.0 CapApp
4.9 ShtDurIncmA p 4.29
Lord Abbett F
32.97 -0.05
EqInc
4.29
... 2.3 EqIndex
65.91 +0.07
5.7 ShtDurIncm
L
52-Wk %
Sym Hi/Lo Chg
NYSE lows - 70
AIG Wt
AIG/WS
AmericanRenal ARA
AnadarkoPetrol APC
AnteroMidstream AMGP
Apache
APA
AvonProducts AVP
BasicEnergySvcs BAS
Bemis
BMS
BillBarrett
BBG
BoardwalkPipe BWP
BonanzaCreekEner BCEI
BrinkerIntl
EAT
CONE Midstream CNNX
CVR Partners UAN
CallonPetrol
CPE
CapitalSrLiving CSU
ChesapeakeEner CHK
Cinemark
CNK
ClearBridgeAmEn CBA
ConagraBrands CAG
ConchoRscs
CXO
CoreLabs
CLB
Corts JCPen JBR JBR
Corts JC KTP KTP
CrescentPoint CPG
EOG Rscs
EOG
EP Energy
EPE
FS Investment FSIC
GameStop
GME
GeneralElec
GE
Greenhill
GHL
Helmerich&Payne HP
Hess Pfd
HESpA
Hess
HES
HormelFoods HRL
J.Jill
JILL
JonesEnergy
JONE
Macerich
MAC
Mack-Cali
CLI
MineralsTechs MTX
NOW
DNOW
Netshoes
NETS
NewYorkREIT NYRT
NuvCreditOpp2022 JCO
OasisPetrol
OAS
Omnicom
OMC
ParsleyEnergy PE
PioneerNatRscs PXD
PrecisionDrilling PDS
RAIT Financial RAS
RSP Permian RSPP
SM Energy
SM
SanchezEnergy SN
SilverBowRscs SBOW
StewartInfo
STC
SturmRuger
RGR
SuperiorEnergy SPN
Supervalu
SVU
TPG Pace
TPGH
TahoeResources TAHO
Tanger
SKT
TejonRanch
TRC
TevaPharm
TEVA
TortoiseEnerInf TYG
TortoiseMLPFund NTG
UnderArmour C UA
UnderArmour A UAA
BMO
BNS
SNP
MDT
21.21
14.81
3.41
18.65
14.43
30.75
-2.3
-0.4
-1.4
-0.1
-1.7
-0.6
Net YTD
NAV Chg % Ret Fund
65.99
71.58
36.62
18.53
14.80
86.93
29.80
51.57
9.56
10.84
22.51
17.29
25.37
18.49
26.50
36.65
Principal Investors
13.28
DivIntlInst
Prudential Cl Z & I
14.60
TRBdZ
+0.13
+0.18
+0.09
-0.09
-0.09
+0.08
-0.07
+0.05
+0.01
-0.05
-0.01
-0.01
-0.02
-0.02
-0.02
-0.05
.71699
.62936
1.51145
.46
-0.4
-0.8
-0.2
0.1
-1.4
-0.9
...
-1.3
...
...
-0.6
0.5
0.4
0.2
NYSE American highs - 4
AmericasSilver
BancorpNJ
Electromed
TasekoMines
4.06
18.15
7.20
1.92
USAS
BKJ
ELMD
TGB
-1.0
0.6
0.6
4.9
NYSE American lows - 6
Q
Q
Q
Nov28 /Nov01
Oct27 /Oct03
Oct06 /Sep19
Oct20 /Sep29
8.59
11.60
22.20
21.63
17.05
45.34
163.12
4.50
25.27
122.00
26.71
20.64
37.95
6.95
30.15
5.03
19.28
7.60
45.60
20.83
21.90
23.52
12.76
27.70
137.73
12.54
45.14
11.55
50.63
13.99
17.68
40.12
2.91
3.55
23.39
36.70
16.43
28.92
22.55
112.17
12.11
10.16
85.62
64.52
44.60
25.25
23.55
13.12
43.3
18.4
7.0
4.7
-0.5
1.3
0.9
3.0
0.2
0.1
1.4
1.7
0.4
3.0
-2.7
0.6
3.4
-1.3
1.7
0.7
1.3
5.3
3.0
-0.4
1.2
1.0
0.9
1.1
...
1.3
0.3
0.1
26.2
2.0
-0.2
3.2
1.9
-2.3
-0.2
1.9
-2.7
0.5
0.2
...
20.1
...
0.2
6.2
ALJJ
Aceto
ACET
AmerOutdoor AOBC
AptevoTherap APVO
AscentCapital A ASCMA
BJsRestaurants BJRI
Baldwin&Lyons B BWINB
BlackBox
BBOX
BravoBrioRestr BBRG
BrighthouseFin BHF
CapitalaFinance CPTA
CarrizoOil
CRZO
Cheesecake
CAKE
ChinaHGSRealEst HGSH
ChinaNetOnline CNET
Chuy's
CHUY
Conifer
CNFR
CyberArkSoftware CYBR
DianaContainer DCIX
Digirad
DRAD
DiscoveryComm C DISCK
EnergyXXIGulfCoast EXXI
FinishLine
FINL
GreenPlains
GPRE
Hawkins
HWKN
ImmunePharma IMNP
InglesMarkets IMKTA
KEYW
KEYW
Koss
KOSS
MidatechPharma MTP
MySize
MYSZ
NantHealth
NH
NatlGeneral
NGHC
NumereX
NMRX
OHAInvestment OHAI
OncobiologicsWtB ONSIZ
OssenInnovation OSN
ProspectCapital PSEC
QuestResource QRHC
Quotient
QTNT
SearsHometown SHOS
ShoeCarnival SCVL
SundanceEnergy SNDE
TOP Ships
TOPS
TravelCtrsNt29 TANNL
TravelCtrsNt30 TANNZ
TravelCenters TA
TravelCtrsNt28 TANNI
UltaBeauty
ULTA
ValueLine
VALU
VertexEnergy VTNR
WilhelminaIntl WHLM
Net YTD
NAV Chg % Ret Fund
23.9
21.2
25.2
21.2
15.5
15.3
2.5
19.1
3.8
19.5
10.3
11.5
12.6
13.5
14.2
8.9
37.16
11.06
10.31
0.55
48.46
29.96
12.85
29.97
47.56
116.18
25.02
38.48
9.50
21.15
21.70
87.95
10.15
93.93
12.90
11.60
83.41
22.31
108.51
33.78
12.35
0.5
-0.6
0.1
4.1
1.0
0.7
1.2
1.1
2.1
0.1
0.6
0.8
3.9
2.5
1.9
...
3.1
0.4
11.3
2.4
-0.3
8.1
0.7
2.1
4.2
Nasdaq lows - 52
Nasdaq highs - 73
AbeonaTherapWt ABEOW
AbeonaTherap ABEO
AdamasPharm ADMS
AkceaTherap AKCA
AkebiaTherap AKBA
Alarm.com
ALRM
Apple
AAPL
ArbutusBiopharma ABUS
ArchCapGroupPfdF ACGLO
Bio-Techne
TECH
BioShBiotechClin BBC
BoingoWireless WIFI
CadenceDesign CDNS
CalumetSpecialty CLMT
Cellectis
CLLS
CelsiusHldg
CELH
CenturyAluminum CENX
Clarus
CLAR
CogentComm CCOI
CommerceHub C CHUBK
CommerceHub A CHUBA
CovenantTranspt CVTI
Daseke
DSKE
Descartes
DSGX
ElbitSystems ESLT
ElectroScientific ESIO
EnantaPharma ENTA
ExtremeNetworks EXTR
FS Bancorp
FSBW
Ferroglobe
GSM
FirstSouthBancorp FSBK
FT HK AlphaDEX FHK
FusionTelecom FSNN
GluMobile
GLUU
GoldenEnt
GDEN
HealthInsInnov HIIQ
Hortonworks HDP
IberiabankPfdC IBKCO
IXYS
IXYS
Icon
ICLR
Immunomedics IMMU
IndustreaAcqn INDUU
iSh13YearIntlTBd ISHG
JohnsonOutdoors JOUT
JunoTherap
JUNO
KCAPFinl6.125Nts22 KCAPL
KalaPharm
KALA
KratosDefense KTOS
52-Wk %
Sym Hi/Lo Chg
LeMaitreVascular LMAT
LindbladExped LIND
MillAcqn Un
MIIIU
MillAcqn Wt
MIIIW
MercurySystems MRCY
MidPennBancorp MPB
MustangBio
MBIO
MyriadGenetics MYGN
NV5Global
NVEE
NationalBeverage FIZZ
NY MtgPfdC
NYMTO
Orbotech
ORBK
Otelco
OTEL
Otonomy
OTIC
Overstock
OSTK
Parexel
PRXL
RadNet
RDNT
RoyalGold
RGLD
SangamoTherap SGMO
Sientra
SIEN
SparkTherap
ONCE
TabulaRasaHlth TRHC
TechData
TECD
WernerEnterprises WERN
ZAGG
ZAGG
5.06 -3.9
0.77 -5.1
3.16 -8.0
6.04 -17.5
0.30 -20.0
ALJ Regional
0.85 -7.3
Daxor
DXR
NorthernOil&Gas NOG
Pfenex
PFNX
PowerREIT
PW
ReavesUtilityRtWi UTGrw
Versar
VSR
TIAA/CREF Funds
VANGUARD FDS
18.23 +0.01 9.9 DivdGro
7.2 EqIdxInst
25.43
IntlEqIdxInst 19.40 -0.10 17.2 HlthCare r
207.17
NA Tweedy Browne Fds
INSTTRF2020 21.89
27.52 -0.14 9.9 INSTTRF2025 22.04
5.3 GblValue
INSTTRF2030 22.14
6.5
INSTTRF2035 22.23
VANGUARD ADMIRAL
INSTTRF2040 22.33
6.5 500Adml
226.62 +0.23 10.7 INSTTRF2045 22.42
33.09 +0.03 7.4 IntlVal
BalAdml
37.38
11.89 +0.01 4.9 LifeGro
6.7 CAITAdml
31.77
CapOpAdml r 143.24 +0.07 15.3 LifeMod
26.10
6.7 EMAdmr
36.59 -0.01 23.9 PrmcpCor
24.87
72.49 -0.02 7.4 SelValu r
EqIncAdml
30.97
24.3 ExtndAdml
76.82
... 6.2 STAR
26.13
10.2 GNMAAdml
10.57 +0.01 2.0 STIGrade
10.72
5.6 GrwthAdml
66.77 +0.15 17.2 TgtRe2015
15.57
10.6 HlthCareAdml r 87.39 -0.03 15.3 TgtRe2020
30.70
V
24.86
31.00
23.65
23.81
32.00
39.79
20.88
13.00
25.04
22.83
17.24
6.33
12.59
25.44
iPathBloomGrainsTR JJG
iPathPBGrains WEET
PwrShDB G10 DBV
PwrShDB USDBull UUP
PwrShDynRetail PMR
ProShShortEuro EUFX
ProShUltShEuro EUO
ProShUltShGoldMin GDXS
SpinFieldUVAUncons FFIU
TeucriumAgricFd TAGS
TeucriumCornFund CORN
TeucriumWheatFund WEAT
VanEckUnOil&Gas FRAK
WisdTrUSDBull USDU
HYCorAdml r 5.95
InfProAd
25.98
89.18
IntlGrAdml
ITBondAdml 11.56
ITIGradeAdml 9.89
LTGradeAdml 10.63
MidCpAdml 176.35
11.42
MuHYAdml
14.28
MuIntAdml
MuLTAdml
11.72
11.04
MuLtdAdml
MuShtAdml 15.83
PrmcpAdml r 124.49
REITAdml r 117.73
SmCapAdml 63.99
STBondAdml 10.50
STIGradeAdml 10.72
10.86
-0.05 20.7 TotBdAdml
TotIntBdIdxAdm 21.92
+0.01 5.7 TotIntlAdmIdx r 28.82
61.08
TotStAdml
13.56
TxMIn r
S
ValAdml
37.83
Schwab Funds
65.49
WdsrllAdml
38.11 +0.04 10.7
S&P Sel
64.29
WellsIAdml
71.26
WelltnAdml
T
WndsrAdml
74.09
Growth
HelSci
InstlCapG
IntlStk
IntlValEq
MCapGro
MCapVal
N Horiz
N Inc
OverS SF r
R2020
R2025
R2030
R2035
R2040
Value
4.0
4.1
6.6
2.3
52-Wk %
Sym Hi/Lo Chg Stock
Stock
Tuesday, August 29, 2017
52-Wk %
Sym Hi/Lo Chg Stock
/Aug29
KEY: A: annual; M: monthly; Q: quarterly; r: revised; SA: semiannual;
S2:1: stock split and ratio; SO: spin-off.
The following explanations apply to the New York Stock Exchange, NYSE Arca, NYSE
MKT and Nasdaq Stock Market stocks that hit a new 52-week intraday high or low in
the latest session. % CHG-Daily percentage change from the previous trading session.
Stock
1:6
LINU
Bank of Montreal
Bank Of Nova Scotia
China Petroleum ADR
Medtronic
Oct19 /Sep29
New Highs and Lows | WSJ.com/newhighs
52-Wk %
Sym Hi/Lo Chg Stock
Payable /
Record
Foreign
Funds and investment companies
Dreyfus Hi Yd Strat Fd
Fidelity Corporate Bd
Fidelity Limited Term Bd
Fidelity Total Bond ETF
Amount
Yld % New/Old Frq
Symbol
LiNiu Technology Group
Payable /
Record
Reduced
Prospect Capital
NYSE AMER
Stocks
Amount
Yld % New/Old Frq
Symbol
Net
Sym Close Chg
Stock
1.46 LibertySirius A LSXMA 43.45 0.11 SS&C Tech SSNC 38.09 0.06
SIVB 165.91 -2.04
0.46 LibertySirius B LSXMB 43.28 0.05 SVB Fin
0.21 LibertySirius C LSXMK 43.46 0.21 ScrippsNetworks SNI 85.95 0.24
STX 31.45 -0.04
0.03 LincolnElectric LECO 85.66 -0.04 Seagate
0.81 LogitechIntl LOGI 34.97 -0.03 SeattleGenetics SGEN 49.25 0.49
SHPG 145.51 -0.79
-0.17 LogMeIn
LOGM 112.30 0.35 Shire
-0.33 lululemon
LULU 58.32 -1.81 SignatureBank SBNY 128.46 -1.38
SIRI 5.63 0.05
0.19 MarketAxess MKTX 188.87 -1.05 SiriusXM
0.10 Marriott
MAR 100.23 -0.48 Skyworks SWKS 101.52 0.82
SPLK 64.38 -0.10
0.10 MarvellTech MRVL 17.26 0.12 Splunk
SPLS 10.22
...
-0.21 Mattel
MAT 16.11 -0.36 Staples
-0.56 MaximIntProducts MXIM 44.75 -0.03 Starbucks SBUX 54.10 -0.30
1.05 MelcoResorts MLCO 20.97 0.56 SteelDynamics STLD 34.51 0.03
SRCL 72.02 -0.08
-0.12 MercadoLibre MELI 240.90 -1.64 Stericycle
-0.26 MicrochipTech MCHP 83.83 0.07 Symantec SYMC 29.69 -0.23
Synopsys
SNPS 78.80 0.01
0.66 MicronTech MU 31.48 0.40
0.20 Microsemi MSCC 48.90 -0.10 TD Ameritrade AMTD 42.73 -0.13
TSRO 124.23 -1.11
-1.15 Microsoft
MSFT 73.05 0.22 TESARO
0.28 Middleby
MIDD 119.00 0.30 T-MobileUS TMUS 63.47 -0.25
0.94 Momo
MOMO 34.08 0.20 TRowePrice TROW 84.03 -0.11
-0.13 Mondelez MDLZ 41.89 0.59 TakeTwoSoftware TTWO 95.79 -0.02
TSLA 347.36 1.70
0.53 MonsterBeverage MNST 55.37 0.21 Tesla
-0.12 Mylan
MYL 30.50 -0.33 TexasInstruments TXN 81.03 0.27
TractorSupply
TSCO 58.76 -0.20
-0.22 NXP Semi NXPI 112.31 -0.26
TRMB 38.02 -0.07
0.04 Nasdaq
NDAQ 75.21 -0.42 Trimble
TripAdvisor
TRIP 41.69 -0.29
-0.13 NetApp
NTAP 38.03 -0.31
2.11 Netease
NTES 265.15 -1.68 21stCenturyFoxA FOXA 27.35 0.10
-1.11 Netflix
NFLX 168.81 1.69 21stCenturyFoxB FOX 26.91 0.15
1.43 NewsCorp A NWSA 13.36 -0.07 t UltaBeauty ULTA 211.78 4.03
0.08 NewsCorp B NWS 13.70 -0.10 UltimateSoftware ULTI 198.11 1.49
-0.10 Nordson
NDSN 108.32 -0.86 UnitedTherap UTHR 128.39 -1.22
WOOF 92.72 0.05
0.11 NorthernTrust NTRS 88.54 -0.42 VCA
VEON 4.19 0.03
1.40 NorwegianCruise NCLH 57.64 -0.24 VEON
VeriSign
VRSN 101.62 -0.59
-0.07 NVIDIA
NVDA 164.70 -0.27
0.49 OReillyAuto ORLY 197.02 -1.04 VeriskAnalytics VRSK 79.52 0.29
VertxPharm
VRTX 152.89 -0.51
0.60 OldDomFreight ODFL 99.15 1.93
-0.23 ON Semi
ON 16.18 0.04 Viacom A VIA 37.80 -0.10
0.12 OpenText
OTEX 31.64 -0.22 Viacom B VIAB 29.28 -0.15
0.85 PTC
PTC 54.73 -0.10 Vodafone VOD 28.46 -0.25
WPPGY 92.44 -0.14
-0.10 Paccar
PCAR 65.16 0.76 WPP
-0.70 PacWestBancorp PACW 44.91 -0.52 WalgreensBoots WBA 81.42 0.26
Weibo
WB
96.96 1.88
PAYX 56.59 0.10
-0.32 Paychex
PYPL 61.01 0.48 WesternDigital WDC 90.07 -0.49
1.65 PayPal
WillisTwrsWatson
WLTW
147.87
-0.13
-0.44 People'sUtdFin PBCT 16.66 -0.10
-0.51 PilgrimPride PPC 28.73 0.08 WynnResorts WYNN 135.25 1.35
Xilinx
XLNX
65.76
0.58
PCLN 1807.06 17.15
-0.30 Priceline
YNDX 29.49 0.02
QGEN 31.63 -0.03 Yandex
-0.19 Qiagen
QRVO 70.46 -0.14 ZebraTech ZBRA 101.59 -1.23
-0.10 Qorvo
Zillow A
ZG 39.70 1.14
0.27 Qualcomm QCOM 51.81
...
Zillow C
Z
39.44 1.23
0.10 RandgoldRscs GOLD 101.95 1.96
ZionsBancorp ZION 43.71 -0.57
-0.20 RegenPharm REGN 479.03 -0.19
-0.16 RossStores ROST 58.69 -0.33
0.05 s RoyalGold RGLD 92.48 0.37
RYAAY 114.15 0.66 CheniereEnergy LNG 41.33 -0.81
-0.18 Ryanair
0.01 SBA Comm SBAC 152.00 -0.36 CheniereEnerPtrs CQP 27.14 -0.44
-0.29 SEI Investments SEIC 57.18 -0.02 CheniereEnHldgs CQH 25.44 0.34
SINA 98.07 -0.02 ImperialOil IMO 29.24 0.06
-0.24 Sina
Company
Dividend announcements from August 29.
Company
Net
Sym Close Chg
Stock
2.90 ...
10.50 -0.7
16.93 -4.5
1.15 12.6
8.87 -2.0
30.25 -3.0
21.30 1.9
3.15 -3.0
2.60 -2.7
54.77 0.8
8.67 0.2
11.73 -0.2
40.37 -2.4
1.27 -9.0
0.93 -3.2
18.75 -3.8
6.26 1.0
39.54 0.4
0.67 -8.5
3.55 -1.4
20.89 -1.6
9.85 ...
6.90 -18.4
16.35 0.3
35.20 -0.7
1.14 -3.2
20.80 -4.6
6.90 -0.4
1.41 1.3
2.17 -4.2
0.72 -2.4
2.74 -3.4
17.30 -1.1
3.68 -0.8
0.98 1.0
0.05 -2.4
1.64 -3.8
6.60 -1.4
1.21 -0.8
3.27 -6.0
1.80 2.7
15.08 -3.0
3.61 ...
0.67 -17.4
17.19 -5.6
17.00 -3.3
2.95 -2.4
18.63 -4.5
204.01 1.9
13.26 -1.9
0.89 1.9
5.67 -4.1
Net YTD
NAV Chg % Ret
TgtRe2025
TgtRe2030
TgtRe2035
TgtRe2040
TgtRe2045
TgtRe2050
TgtRetInc
TotIntBdIxInv
WellsI
Welltn
WndsrII
...
+0.04
-0.20
+0.02
+0.02
+0.02
-0.33
+0.02
+0.01
+0.02
+0.01
...
+0.10
-0.12
...
...
...
+0.02
+0.03
-0.11
+0.05
-0.06
-0.01
+0.02
+0.03
...
-0.11
5.7
2.2
32.5
4.6
4.5
8.5
8.9
6.3
4.7
5.4
2.9
1.4
14.4
2.4
4.1
1.7
2.3
3.6
1.8
18.7
9.9
17.3
5.6
6.1
5.7
7.0
7.9
17.92
...
32.23 -0.02
19.72 -0.01
33.82 -0.03
21.20 -0.02
34.11 -0.03
13.42
...
10.96 +0.01
26.54 +0.02
41.26
...
36.90 +0.01
VANGUARD INDEX FDS
226.58 +0.23
500
189.59
...
ExtndIstPl
51.88 -0.01
SmValAdml
TotBd2
10.82 +0.01
17.23 -0.07
TotIntl
61.05 +0.05
TotSt
VANGUARD INSTL FDS
33.10 +0.03
BalInst
DevMktsIndInst 13.58 -0.06
DevMktsInxInst 21.22 -0.10
76.82
...
ExtndInst
GrwthInst
66.78 +0.15
10.58 +0.01
InPrSeIn
223.62 +0.22
InstIdx
223.64 +0.22
InstPlus
54.82 +0.04
InstTStPlus
MidCpInst
38.96 -0.07
192.14 -0.35
MidCpIstPl
63.99
...
SmCapInst
STIGradeInst 10.72
...
10.86 +0.02
TotBdInst
TotBdInst2
10.82 +0.01
10.86 +0.02
TotBdInstPl
TotIntBdIdxInst 32.89 +0.05
TotIntlInstIdx r 115.25 -0.45
TotItlInstPlId r 115.27 -0.45
61.09 +0.05
TotStInst
37.83 -0.01
ValueInst
+0.04
-0.07
...
-0.01
-0.01
-0.02
-0.01
-0.02
-0.11
-0.02
-0.01
+0.01
...
+0.01
...
...
-0.01
10.2
15.3
8.7
9.6
10.4
11.1
12.0
12.3
17.7
11.2
9.1
12.1
7.6
11.1
2.2
7.3 Western Asset
8.6 CorePlusBdI
9.6
10.4
11.2
11.9
12.2
12.2
5.6
1.7
5.6
7.0
6.0
10.6
6.3
0.6
3.6
18.6
9.8
7.4
17.4
17.3
6.3
17.2
2.2
10.7
10.7
9.9
9.0
9.0
4.1
2.3
3.6
3.6
3.6
1.8
18.7
18.7
9.9
5.6
W
NA
...
NA
B12 | Wednesday, August 30, 2017
THE WALL STREET JOURNAL.
* *
BANKING & FINANCE
Buffett’s BofA
Profit: $13 Billion
LUIS PARADA/REUTERS
BY RACHEL LOUISE ENSIGN
People carry gas cylinders at a distribution point San Cristobal, Venezuela. The OPEC member country has faced gasoline shortages.
Cantor Cuts Out Venezuela
Firm halts debt
trading after U.S.
imposes financial
sanctions on nation
have pulled all bonds issued by
the Republic of Venezuela and
state oil company Petróleos
de Venezuela SA, known as
PdVSA, from auctions and told
customers those trades are restricted, said Cantor clients.
Cantor declined to comment.
On Friday, the U.S. Treasury
banned U.S. financial institutions from trading any new
bonds issued by Venezuela or
from trading with any Venezuelan government entity. Officials said the move aims to
punish President Nicolás Maduro and his administration
for a move toward authoritarianism and that more financial
sanctions would come if the
repression continues.
“Maduro may no longer
take advantage of the American financial system to facilitate the wholesale looting of
the Venezuelan economy at the
expense of the Venezuelan
people,” U.S. Treasury Secretary Steven Mnuchin said last
week.
Traders say they are slowing
or stopping trades in the country’s securities because of fear
that they could be unknowingly
Cantor Fitzgerald LP
stopped trading Venezuelan
debt Tuesday, days after the
Treasury Department slapped
By Anatoly Kurmanaev
in Caracas and Matt
Wirz in New York
financial sanctions on the
country for undermining democracy.
The move is the first blanket restriction on Venezuelan
bonds by a large U.S. financial
institution. Trading in Venezuelan debt, until recently among
the most easily purchased
emerging-market bonds, has
slowed to a trickle this week,
reflecting typical end-of-summer torpor as well as investor
efforts to evaluate the impact
of the U.S. sanctions.
Cantor, one of the largest
intermediaries for Wall Street
traders, as well as its affiliates
GFI Group and BGC Partners
buying or selling bonds on behalf of people connected to the
Venezuelan government.
Just $7.4 million worth of
PdVSA’s flagship bond due in
2024 changed hands Tuesday,
less than half the amount a
year ago and down from $141
million traded on Aug. 24, the
last day before the sanctions,
according to MarketAxess data.
Large Wall Street investment banks that trade with investors continued to buy and
sell Venezuelan bonds Tuesday, investors said. The difference, or “spread,” between the
bid and offer prices quoted by
the banks has widened to as
much as 1 percentage point
from half a point, they said,
showing that the banks are
charging more from clients to
execute trades as the perceived risk of doing so has
risen.
Venezuelan bond trading attracted public scrutiny earlier
this year after the asset-management business of Goldman
Sachs Group Inc. bought $2.8
billion worth of the country’s
debt at about 30 cents on the
dollar.
The Venezuelan opposition
accused the investment bank
of financing Mr. Maduro’s repression of peaceful protesters. Goldman Sachs had said
the bonds were bought on the
secondary markets and didn’t
add any fresh funds to the government.
Earlier this month, Credit
Suisse Group said it prohibited
its traders from buying and
selling two existing Venezuelan bonds because of the risk
the trades would finance human-rights abuses.
The policy forbids employees from trading or using as
collateral two specific bonds,
one issued by the Venezuelan
government due in 2036 and
one by PdVSA due in 2022, as
well as bonds from government entities issued after June
1.
The Latin America committee of the International Swaps
and Derivatives Association,
which oversees credit default
swap trading, scheduled a special meeting for Wednesday to
discuss Venezuela, a person familiar with the matter said.
—Julie Wernau
and Carolyn Cui
contributed to this article.
Warren Buffett’s Berkshire
Hathaway Inc. officially became the biggest shareholder
of Bank of America Corp. on
Tuesday, notching billions in
gains on the bank’s recovery
from the financial crisis.
Bank of America said Berkshire exercised warrants to
buy 700 million of its shares
at below-market prices, a deal
that ties back to a crisis-era
investment. The move makes
the famous stock picker’s firm
the largest shareholder of the
second- and third-largest U.S.
banks—the third being Wells
Fargo & Co.—while also providing a vote of confidence for
Bank of America stock.
“Berkshire is going to keep
every share for a very long
time,” Mr. Buffett said in an
email to the Journal Tuesday.
Berkshire’s exercise of the
warrants, along with dividends
the company has received on
Bank of America preferred
Scotiabank Earnings
Surpass Expectations
BY CARA LOMBARDO
Bank of Nova Scotia’s
earnings grew in its latest
quarter as business in Canada
and internationally increased.
The Toronto-based bank,
known as Scotiabank, one of
Canada’s largest banks, said
Tuesday it earned 2.1 billion
Canadian dollars ($1.69 billion) in the quarter ended July
31, up from C$1.96 billion a
year earlier.
Earnings per share climbed
to C$1.66 from C$1.54, while
revenue rose 4% to C$6.89 billion. Analysts polled by Thomson Reuters had expected
earnings per share of C$1.64
on revenue of C$6.98 billion.
Scotiabank Chief Executive
Average Yields of Major Banks
Type
Tuesday, August 29, 2017
MMA
1-MO
2-MO
3-MO
6-MO
1-YR
2-YR
2.5YR
5YR
0.10
0.19
0.06
0.07
0.07
0.07
0.12
0.13
0.19
0.21
0.33
0.36
0.46
0.51
0.47
0.50
0.91
0.95
0.00
-0.01
-0.01
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
-0.01
0.00
0.00
0.01
0.04
0.04
National average
Savings
Jumbos
Savings
Jumbos
Consumer Savings Rates
Explanation of ratings: Safe Sound SM, (855) 733-0700, evaluates the financial condition of federally insured institutions and assigns a rank of 1,2,3,4 or 5 based on data from the fourth quarter
of 2015 from federal regulators. 5: most desirable performance; NR: institution is too new to rate,
not an indication of financial strength or weakness. Information is believed to be reliable, but not
guaranteed.
BY TELIS DEMOS
High yield savings
Bank/rank
Phone number
Minimum
Yield
(%)
Money market and savings account
$1
1.40
$1
1.30
$100
1.30
M.Y. Safra Bank, FSB /4
$5,000
(212) 652-7200
VirtualBank /4
$10,000
(877) 998-2265
AloStar Bank of Commerce /4 $1,000
(877) 738-6391
0.30
DollarSavingsDirect /4
(866) 395-8693
BankPurely /4
(844) 878-7359
CIT Bank /4
(855) 462-2652
One-month CD
LUKE SHARRETT/BLOOMBERG NEWS
Banks may take a shortterm hit as Tropical Storm
Harvey paralyzes parts of
Texas, but executives say that,
as in previous storms, disruptions are likely to be modest
and could even portend a longer-term pickup.
The KBW Nasdaq Bank index is down 1.3% since the
storm initially made landfall
Friday night, versus a virtually
flat S&P 500 index. Shares of
banks more heavily concentrated in Texas and the cities
affected are down more
sharply.
Houston, as the country’s
fourth-largest city, is a significant market for many banks,
representing about 2% of bigbank deposits and U.S. mortgage origination volume, according to analysts at
Autonomous Research.
Texas is a larger market for
auto loans, but unlike home
loans, most auto-insurance
policies cover flooding, Autonomous Research analyst Brian
Foran said.
Some regional and local
banks have higher concentrations of loans and deposits,
however.
Regional banks Prosperity
Bancshares and Zions Bancorp have 30% and 19%, respectively, of their deposits in
the Houston area, according to
analysts at Barclays PLC.
Their shares are off around
2.9% and 2.2%, respectively,
since Friday’s close.
Houston-based Allegiance
Bancshares Inc., a commercial
bank to small and medium-size
businesses, has virtually all of
its deposits in the Houston
metropolitan area, analysts
said.
George Martinez, chief executive of Allegiance, said that
the bank planned to begin reopening
some
branches
Wednesday. “We have to go
through a period of adjustment
for our business customers,
but then they’ll return to their
regular strategies,” he said. He
Brian Porter said both Canadian and international personal and commercial banking
earnings jumped more than
10% from last year as loans
and deposits grew.
As a result, the bank increased its quarterly dividend
7% to C$0.79.
In the third quarter, feebased income rose 1%, while
net interest income rose 6%.
Continued investments in digital banking and customer service caused the company’s
noninterest expenses to rise
5%.
The loan-loss provision
didn’t materially change, as
higher retail provisions were
offset by improved provisions
elsewhere.
BANKRATE.COM® MMA, Savings and CDs
Weekly change
Harvey Won’t Hurt Lenders for Long
stock, brings its paper gain on
its investment in the bank to
around $13 billion.
Berkshire bought preferred
shares in the bank in 2011
when the lender sorely needed
to shore up investor sentiment. Bank of America’s share
price was slumping as investors grew worried about potentially billions of dollars in
legal claims and fines related
to the crisis.
Mr. Buffett helped change
the market’s perception with
the investment and by calling
the bank “well led.”
The $5 billion deal also included warrants for Berkshire
to buy 700 million shares of
Bank of America common
stock for $7.14 apiece.
At the time, the strike price
was slightly above where Bank
of America’s shares were trading. Now, it is now far below
the current price of $23.58 a
share.
—Nicole Friedman
contributed to this article.
Shares of banks more heavily concentrated in Texas are down more than peers since the storm hit.
noted that customers who
used
electronic
banking
“hadn’t been slowed down.”
Allegiance shares are down
7.5% since Friday’s close.
Prosperity CEO David Zalman said the bank closed
about 25% of its Texas
branches on Monday—or about
60 branches, mostly in coastal
towns—but had reopened
many the next day. It also
shifted some operations to
West Texas and Dallas, he said.
“We’re used to this,” he
said, citing Texas’ history with
past hurricanes. Despite Harvey’s unusually dramatic impact, he said that “in the long
run, this will create a robust
economy for the state. You’ll
see deposits increase in Texas
banks because of the insurance
money.”
Shares of Green Bancorp
Inc., a commercial and consumer bank also based in
Houston, are off 8.9%. It has
about 60% of its loans and deposits in the Houston area.
Green has closed its Houston area branches and waived
ATM and late fees, with staff
either working remotely or
staying at a hotel next to the
Storm Tossed
Stock and index performance since
Harvey made landfall last Friday
Green
Bancorp
Allegiance
Bancshares
Zions
Bancorp
Prosperity
Bancshares
KBW Nasdaq
Bank Index
S&P 500
-8% -6
-4
-2
0
Source: FactSet
THE WALL STREET JOURNAL.
bank’s operations center in
Houston.
Geoff Greenwade, Green’s
CEO, said he anticipated a
slowdown in loan growth in
the third quarter, with some
loan closings deferred until
later in the year.
He said he anticipated “normal or above normal” growth
in the fourth quarter and be-
yond. “What we’ve typically
seen, because of insurance
money and federal assistance
and construction, it will provide somewhat of an economic
boom for the community over
the next year or two,” Mr.
Greenwade said in an interview.
He anticipated pickups in
the construction and real-estate sectors, as multifamily
properties may find it easier to
attract tenants who may be rebuilding their homes.
Banks typically slash fees on
banking services during disasters and have less customer
activity, which can lead to a
drop in revenue.
Big banks waiving certain
fees, such as ATM or late
charges, include J.P. Morgan
Chase & Co., Wells Fargo &
Co., and Bank of America
Corp., which each have roughly
2% of their deposits in
the Houston metropolitan area,
excluding corporate deposits.
In the short term, based on
patterns experienced in past
storms such as Katrina and
Sandy, analysts also expect
loan activity to drop off and
losses to pick up.
Minimum
Yield
(%)
Six-month CD
VirtualBank /4
$10,000
(877) 998-2265
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
M.Y. Safra Bank, FSB /4
$5,000
(212) 652-7200
1.36
1.32
1.26
One-year CD
0.15
0.10
Two-month CD
VirtualBank /4
(877) 998-2265
Applied Bank /5
(800) 616-4605
Bank/rank
Phone number
Pacific National Bank /4
$1,000
(305) 539-7500
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
M.Y. Safra Bank, FSB /4
$5,000
(212) 652-7200
1.60
1.57
1.56
Two-year CD
$10,000
0.15
$1,000
0.05
Three-month CD
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
TAB Bank /4
$1,000
(800) 837-4136
Luana Savings Bank /4
$1,000
(800) 666-2012
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
VirtualBank /4
$10,000
(877) 998-2265
Northern Bank Direct /5
$500
(844) 348-8996
1.81
1.81
1.80
Five-year CD
1.00
0.95
0.95
Synchrony Bank /5
$25,000
(800) 903-8154
First Internet Bank of Indiana /4 $1,000
(888) 873-3424
Barclays /4
$0
(888) 720-8756
2.35
2.30
2.30
High yield jumbos - Minimum is $100,000
Money market and savings account
M.Y. Safra Bank, FSB /4
(212) 652-7200
BBVA Compass /3
(800) COMPASS
Discover Bank /5
(877) 505-4051
1.26
1.25
1.01
One-month CD
M.Y. Safra Bank, FSB /4
(212) 652-7200
USAA /5
(800) 583-8295
VirtualBank /4
(877) 998-2265
0.22
0.15
1.36
1.32
1.26
First Internet Bank of Indiana /4
(888) 873-3424
M.Y. Safra Bank, FSB /4
(212) 652-7200
VirtualBank /4
(877) 998-2265
1.57
1.56
1.56
Two-year CD
0.15
0.05
0.01
Three-month CD
Luana Savings Bank /4
(800) 666-2012
First Internet Bank of Indiana /4
(888) 873-3424
VirtualBank /4
(877) 998-2265
VirtualBank /4
(877) 998-2265
First Internet Bank of Indiana /4
(888) 873-3424
M.Y. Safra Bank, FSB /4
(212) 652-7200
One-year CD
0.30
Two-month CD
VirtualBank /4
(877) 998-2265
Applied Bank /5
(800) 616-4605
Citizens Trust Bank /4
(404) 659-5959
Six-month CD
First Internet Bank of Indiana /4
(888) 873-3424
VirtualBank /4
(877) 998-2265
My e-BAnC by BAC Florida Bank /4
(855) 512-0989
1.81
1.81
1.81
Five-year CD
1.10
1.00
0.82
Synchrony Bank /5
(800) 903-8154
First Internet Bank of Indiana /4
(888) 873-3424
M.Y. Safra Bank, FSB /4
(212) 652-7200
2.35
2.30
2.26
Notes: Accounts are federally insured up to $250,000 per person effective Oct. 3, 2008. Yields
are based on method of compounding and rate stated for the lowest required opening deposit to
earn interest. CD figures are for fixed rates only. MMA: Allows six (6) third-party transfers per
month, three (3) of which may be checks. Rates are subject to change.
Source: Bankrate.com, a publication of Bankrate, Inc., North Palm Beach, FL 33408
Internet: www.bankrate.com
THE WALL STREET JOURNAL.
Wednesday, August 30, 2017 | B13
* * * *
MARKETS
On a Tear
The euro has been climbing for months on expectations that the
European Central Bank will begin tapering its bond purchases.
$1.35
Bullish positioning by
big and small investors
indicates likelihood
of even higher prices
Jan. 22, 2015
Bond-buying
program announced
1.30
1.25
Investors Add to Gold Bets
1.20
1.15
1.00
2014
’15
Source: FactSet
’16
’17
THE WALL STREET JOURNAL.
Euro’s Ascent Puts
The ECB in a Bind
BY MIKE BIRD
The euro jumped above
$1.20 for the first time in 2½
years in intraday trading, a
headache for the European
Central Bank as it balances
weak inflation with constraints
on the bond-buying program
that it uses to boost prices.
The common currency has
been rising for months on expectations
CURRENCIES among many
investors that
the central
bank will begin tapering its
monthly €60 billion ($71.9 billion) of bond buying as it runs
out of assets to purchase, even
as inflation falls short of its
target.
Late Tuesday in New York,
the euro fell to $1.1974 after
trading as high as $1.2071 earlier in the day. On Monday, the
common currency reached its
highest level since just before
the ECB announced its stimulus program in January 2015,
14%
The euro’s advance against
the U.S. dollar this year
at $1.980. It is up 14% against
the dollar this year.
On Friday, ECB President
Mario Draghi didn’t provide
fresh clues on the direction of
monetary policy at a speech in
Jackson Hole, Wyo. That didn’t
put investors off the euro.
“The market is challenging
the ECB,” said Richard
McGuire, head of rates strategy at Rabobank. “The path of
least resistance is for the euro
to strengthen unless markets
are explicitly told otherwise.”
One reason that bond buying can boost inflation is by
reducing the value of a currency. It does that by pushing
down yields on bonds, making
the region less attractive for
foreign money.
Like many other analysts,
Mr. McGuire believes the bank
will start running out of some
bonds to buy, making the program hard to implement in its
current structure.
“We believe they’ll have to
rein in stimulus even if they’re
doing so at a time when the
inflation outlook is deteriorating,” he said.
Those constraints include a
self-imposed limit preventing
the ECB from holding more
than 33% of any country’s outstanding debt. If Germany’s
central bank continues govern-
ment-bond purchases at its
current rate, Rabobank believes that limit will be reached
around April.
The rise in the euro exacerbates the tension between
those constraints and the
ECB’s main target, keeping inflation close to, but below, 2%.
A 10% rise in the tradeweighted index, which measures the euro against a basket of other currencies,
reduces consumer-price inflation in the eurozone by around
0.45 percentage point over the
subsequent 12 months, say analysts at BNP Paribas SA.
So far this year, the euro
has performed its strongest
since its inception in 1999, rising more than 7% on a tradeweighted basis.
The euro is also gaining on
the strength of the economy, keeping pace with the
U.S. expansion. A series of recent elections doused fears
that a series of antiestablishment politicians would break
up the eurozone, concerns that
had pressured the currency.
Meanwhile, the dollar has
weakened, as political concerns and a recent spate of
weaker-than-expected economic data weigh on it.
Data suggest that traders
see the euro’s rally continuing.
In the week to Aug. 25,
speculators held 87,976 more
contracts betting the euro
would rise than those wagering it would fall, according to
the Commodity Futures Trading Commission. In the past
two months, the CFTC has recorded the largest number of
positions betting on a
strengthening euro in six
years.
At the ECB’s most recent
monetary policy meeting, the
strength of the currency was
mentioned as a potential
worry. “Concerns were expressed about the risk of the
exchange rate overshooting in
the future,” according to official minutes from the meeting.
The central bank has
trimmed its own forecasts for
inflation this year. In March, it
predicted that prices would
rise 1.5% in 2018, but
in June that expectation fell to
1.3%, a forecast that then presumed a euro-dollar exchange
rate of $1.08.
But many investors aren’t
convinced that will spur the
bank to keep up its monetary
stimulus. “It’s really hard for
the ECB to talk down the euro
right now, especially when you
take into account that the dollar has its own reasons to be
weak,” said Viraj Patel, foreign-exchange strategist at
ING Bank.
Messaging App Kik
Plans Initial Coin Offer
BY PAUL VIGNA
Messaging-app operator Kik
Interactive said Tuesday that
it is aiming to raise $125 million through an initial coin offering in September, one of the
first established companies to
step into the mushrooming,
highly speculative market for
these digital tokens.
In doing so, Kik, which has
encountered growth issues, is
trying to tap into the surging
interest in cryptocurrencies
and digital tokens associated
with them. It also is experimenting with a potential way
for its investors to essentially
cash out of the company without actually selling their equity.
The market for digital coins
has exploded in 2017, with
more than 100 firms raising
more than $1.7 billion, up from
64 firms raising about $103
million in 2016, according to
research firm Smith & Crown.
Most of these firms, though,
are startups and in many cases
don’t have a working product.
In that, Kik is different: Its
messaging app is popular
among teens in Canada and
the U.S. Kik also allows developers to publish games and
services within the platform, a
hook meant to keep users on
the app for longer.
The Ontario-based company
has said it has 300 million registered users. But Kik revealed
in the token offering’s marketing materials that it only has
15 million monthly active users, a key metric.
“We went on record two
years ago and said growth is a
problem for us,” Chief Executive Ted Livingston said in a
recent interview. Kik has been
boxed out by larger rivals like
Facebook Inc., he added, which
can match any new service Kik
offers and sell it to a larger
user base. Now, Kik is trying to
recast its platform around an
in-house currency and refocus
its shareholders on the digital
tokens it plans to issue.
Retail and professional investors are in sync with their
bullish bets on gold, a sign
that the precious metal can
push to fresh highs.
Gold for August delivery
rose 0.3% Tuesday to $1,313.10
a troy ounce on the Comex division of the New York Mercantile Exchange, following a 1.3%
advance on Monday. The precious metal is at levels it hasn’t
reached since last September,
before ReCOMMODITIES p u b l i c a n s
took
the
W h i t e
House and retained Congress.
The election boosted hopes for
U.S. economic growth and
prompted traders to dump gold.
Now, for the first time
since June, both futures contracts and flows into exchange-traded funds are looking similarly supportive.
Bullish futures positioning in
gold has risen for six straight
weeks, and the two largest
gold ETFs have pulled in new
money in each of the past two
weeks, according to the Commodity Futures Trading Commission and Morningstar.
Investors big and small
moving the same direction is
an important step for prices
to break out through key levels of resistance, market technicians say. Twice this year,
gold’s charge higher was denied around the $1,300 level,
but positioning is more bullish
this time around.
Futures contracts tend to
be the domain of hedge funds
and big speculative traders,
while ETFs, with their lower
per-share prices, tend to be a
favorite of retail investors and
their financial advisers.
Some analysts had been reluctant to endorse gold until
ETF money flows turned positive. Investors withdrew a total of $2.6 billion from the $33
billion SPDR Gold Shares exchange-traded fund and the
$8.9 billion iShares Gold Trust
from the week ended April 26
Gold’s futures contracts and ETF inflows both are supporting prices. Jewelry at a Gaza City market.
Charging Into Gold
Net futures-market bets that gold will rise
are at their highest level since October*...
...and money is pouring into
exchange-traded funds†.
300 thousand
$1,000 million
750
250
500
200
250
150
0
–250
100
–500
50
–750
0
–1,000
2016
2017
Jan. Feb. March April May
June July Aug.
*Through Aug. 22. †Combined weekly money flows into the SPDR Gold Shares ETF and the iShares Gold Trust, through Aug. 23.
Sources: Commodity Futures Trading Commission (futures), Morningstar (funds)
THE WALL STREET JOURNAL.
through Aug. 9.
Now in a shift, the two large
gold ETFs pulled in $680 million in two weeks ended Aug.
22. And Monday, the SPDR
Gold Shares ETF by itself had
an inflow of $379 million, the
largest one-day flow since
June 7, according to FactSet.
Gold drew haven buyers earlier this month in the wake of
U.S.-North Korea saber-rattling.
North Korea is a concern, and
that drove the climb again Tuesday, but gains have mostly been
powered by a weakening dollar
and diminished expectations for
the Federal Reserve to boost interest rates again this year. Gold
is priced in dollars and a weaker
dollar makes it cheaper for
overseas buyers. Higher interest
rates, adjusted for inflation,
make owning bonds more appealing than gold, which produces no income.
Another reason to favor
gold in the weeks ahead:
There is a risk lawmakers will
fail next month to authorize
new spending and raise the
statutory debt limit. A government shutdown or questions
about the Treasury Depart-
ment’s ability to pay its bills
could stoke market turmoil favorable to gold.
A raft of political and economic worries haven’t hit
stocks yet. The S&P 500 is just
1.4% below its all-time high.
But bullish positioning in gold
vehicles shows investors are
bracing for turmoil—and Tuesday’s advance for gold amid
concerns about the latest missile test by North Korea was
just one example of the turmoil they might see.
—Amrith Ramkumar
contributed to this article.
Treasury
Yield at
Year’s Low
BY AKANE OTANI
KIMIMASA MAYAMA/EPA/SHUTTERSTOCK
1.05
MAHMOUD ISSA/ZUMA PRESS
BY CHRIS DIETERICH
1.10
A Tokyo TV program’s screen reports that North Korea launched a missile over Japan on Tuesday.
Stocks Stabilize After Jolt
BY MICHAEL WURSTHORN
AND RIVA GOLD
U.S. stocks recovered Tuesday after North Korea’s
launch of a ballistic missile
over Japan rattled global
markets.
The missile was the first
that Pyongyang has fired over
Japan’s main islands since
2009 and the latest in a string
of direct provocations that
have briefly weighed on financial marTUESDAY’S kets in recent
MARKETS
weeks.
Gains in industrial
and
technology stocks helped
bring major U.S. indexes back
into positive territory.
“North Korea was clearly
an important factor in causing
investors to pause this morning,” said Rui De Figueiredo,
chief investment officer and
co-head of Morgan Stanley Investment Management’s multiasset group. “Whenever we
have these bouts of uncertainty, the market tends to reflect that,” he added. “But at
the same time, investors have
been quickly refocusing on
[economic] fundamentals.”
The Dow Jones Industrial
Average rose 56.97 points, or
0.3%, to 21865.37 after falling
135 points earlier in the session. The S&P 500 added 2.06
points, or less than 0.1%, to
2446.30 and the Nasdaq Composite rose 18.87 points, or
0.3%, to 6301.89.
Rising shares of United
Technologies helped turn the
Dow industrials positive. The
aircraft-equipment
maker
added $3.37, or 2.9%, to
$118.70 after The Wall Street
Journal reported the company
was near a deal to buy Rockwell Collins for more than
$20 billion. United Technologies, which had been trading
lower before the news, accounted for roughly half of
the blue-chip index’s daily
gain.
Boeing added 3.31, or 1.4%,
to 240.49.
Technology
companies
within the S&P 500 gained
0.4%, led by Micron Technology, which rose 40 cents, or
1.3%, to 31.48, and Akamai
Technologies, which gained
57 cents, or 1.3%, to 45.71.
Some money managers said
the latest North Korea developments contributed to an increase in phone calls from investors who were worried
about the impact on their
portfolios. But for the most
part, investors were staying
put, they said, with some
choosing to scale back some
long-held positions to lock in
gains made amid the eightyear stock-market rally.
“We have been selling and
trimming out of our larger,
longer holdings,” said Trip
Miller, a managing partner at
Gullane Capital Partners. “As
valuations have gone up,
we’ve found more to do on
the short side.”
Positive economic data
helped keep deeper selling at
bay, investors added.
A measure of U.S. consumer confidence rose in August to the second-highest
reading since late 2000, while
home-price growth accelerated slightly in June because
of upward pressure from limited inventory and strong
buyer demand.
The Stoxx Europe 600 fell
1% to its lowest close since
February.
Early Wednesday, Japan’s
Nikkei Stock Average was up
0.6% as the yen fell against
the dollar, an aid to Japanese
exporters. Hong Kong’s Hang
Seng Index was up 0.7%.
The yield on the 10-year
U.S. Treasury note fell to its
lowest level of the year, as
fresh threats from North Korea
pushed investors into assets
viewed as safer stores of value.
The yield settled at 2.134%,
down from 2.159% Monday.
Yields, which
CREDIT
drop as bond
MARKETS prices rise, fell
sharply
overnight
after
North Korea fired a ballistic
missile over Japan, prompting
U.S. President Donald Trump
to warn Wednesday that “all
options are on the table” in responding.
The 10-year yield fell as low
as 2.088% overnight. By afternoon, however, yields rose off
their lows. Positive economic
data helped boost investor
sentiment, some analysts said.
Yields on the 10-year U.S.
Treasury note also pared
losses after data showed a
measure of U.S. consumer confidence rose in August to the
second-highest level since late
2000, the latest sign that consumers are feeling generally
upbeat about the economy.
AUCTION RESULTS
Here are the results of Tuesday's Treasury auctions.
All bids are awarded at a single price at the marketclearing yield. Rates are determined by the difference
between that price and the face value.
FOUR-WEEK BILLS
$85,833,333,800
Applications
$25,000,123,800
Accepted bids
$421,700,100
" noncompetitively
$0
" foreign noncompetitively
99.925333
Auction price (rate)
(0.960%)
0.974%
Coupon equivalent
4.58%
Bids at clearing yield accepted
912796LV9
Cusip number
The bills, dated Aug. 31, 2017, mature on Sept. 28,
2017.
SEVEN-YEAR NOTES
$69,856,768,800
Applications
$28,877,628,800
Accepted bids
$18,666,800
" noncompetitively
$0
" foreign noncompetitively
99.569957
Auction price (rate)
(1.941%)
1.875%
Interest rate
83.43%
Bids at clearing yield accepted
9128282U3
Cusip number
The notes, dated Aug. 31, 2017, mature on Aug. 31,
2024.
B14 | Wednesday, August 30, 2017
THE WALL STREET JOURNAL.
* *
MARKETS
Uneasy Investors Power Utilities Stocks
Desire for havens,
solid earnings and a
lower chance of a rate
rise spur August rally
BY AKANE OTANI
Investors are paying for
peace of mind.
U.S. government bonds,
gold and other assets that investors view as safe stores of
value rose Tuesday, extending
recent gains for so-called havens after North Korea
launched a missile over Japan.
It was the latest reflection of
investor unease in a month
that has included escalating
threats between the U.S. and
North Korea; fallout from President Donald Trump’s response
to protests in Charlottesville,
Va.; terrorist attacks in Europe, and some disappointing
earnings from U.S. companies.
Another sign that investors
have played defense in August:
Utilities stocks are leading
gains in the S&P 500 this
month and are outperforming
the broader index in 2017, after the group lagged behind
earlier this year.
The utilities sector fell 0.2%
Tuesday, finishing behind the
S&P 500’s gain of less than
0.1%. Still, utilities have risen
3.1% in August, compared with
a decline of 1% for the broader
index over the same period.
With economic data indicating inflation remains soft, utilities companies also have benefited from the dwindling threat
of rising interest rates, investors and analysts say. Federalfunds futures, used by investors to place bets on the Fed’s
rate-policy outlook, on Tuesday
showed a roughly 32% chance
of a rate increase by December,
down from 40% Monday and
47% a month ago, according to
CME Group Inc. data.
As a result, governmentbond yields have remained depressed, with the yield on the
10-year U.S. Treasury note fall-
ing Tuesday to 2.134%, down
from 2.446% at the end of
2016. With bond yields so low,
utilities remain an attractive,
relatively stable income-producing investment, analysts
say.
The dividend yield of the
utilities sector was at 3.2% on
Monday, according to FactSet.
Strong earnings also have
helped some utilities companies rally.
The best-performing stock
in the sector this month is
Missouri-based power company Ameren Corp., which reported a jump in quarterly
profits at the start of the
month and raised its earnings
forecast for 2017. The stock
has risen 7.7% this month and
15% this year.
Power-distribution company Alliant Energy Corp. and
CenterPoint Energy Inc.,
other top-performing stocks in
the utilities sector in August,
have risen more than 6%
apiece over the course of the
month.
Many caution that after
their run-up, utilities stocks
look expensive. The S&P 500
utilities sector traded Monday
at 19.80 times its previous 12
months of earnings, according
to FactSet, above its 10-year
average of roughly 16. The
broader S&P 500 traded at
21.23 times trailing earnings.
The sector’s rally could
pause if there are fresh signs
of economic growth, or if
there appear to be reduced political risks out of Washington,
said Quincy Krosby, chief market strategist at Prudential Financial. The Labor Department
is scheduled to report monthly
employment figures Friday,
giving investors another look
at the state of the U.S. economic recovery.
“We’ve had a lot of rhetoric
pushing investors into safety,”
Ms. Krosby said. But with
more economic data on the
docket in September, that rally
could be short-lived, she
added.
Electric
Point contribution of Dow
Jones Utility Average
components so far this year
Utilities stocks are closing in on health care as this year's
second-best-performing sector in the S&P 500.
25%
S&P 500
technology
20
15
S&P 500
health care
10
S&P 500
utilities
5
S&P 500
0
Jan. ’17
Feb.
May
April
March
June
July
The Dow Jones Utility Average has hit several records recently.
750
American
Electric
Power
8.69
725
700
675
650
625
Monday
600
Seventh record in
10 trading days
575
2016
Duke
Energy
7.82
Such shares offer relatively hefty dividends,
while yields remain low elsewhere.
S&P 500 utilities
dividend yield
3.5%
3.0
10-year
Treasury yield
S&P 500
dividend yield
2.0
1.5
Jan. ’17
Feb.
March
April
May
June
July
Aug.*
However, the rally in utilities shares has increased their valuations, which could damp their appeal.
12-month trailing price/earnings ratio*
24
22
S&P 500
20
S&P 500
utilities
18
16
14
2015
2016
Sources: FactSet (indexes, dividends, P/E); WSJ Market Data Group (points); Ryan ALM (Treasury yield)
Volume and mix
Pricing
Components of Nestlé’s organic growth
8%
6
4
2
0
’06
’07
’08
’09
’10
’11
’12
’13
’14
’15
’16
THE WALL STREET JOURNAL.
So far, investors have been
happy to shrug off these
problems. Nestlé’s shares
trade at 22 times forward
earnings, close to their highest level since the dot-com
era. Consumer staples are
still considered a low-risk investment, with a bondlike income profile. And investors
are also excited about the
potential for cost savings.
This was the stated rationale
for Mr. Loeb’s $3.5 billion investment in June.
At Kraft Foods, then at
Heinz, Brazilian private-equity house 3G, together with
Warren Buffett, pioneered a
new approach to the U.S.
packaged-food sector that involved radically trimming
fat. Faced with the threat of
a Kraft-Heinz takeover, U.K.
consumer group Unilever announced an aggressive new
20% margin target in April.
Judging by this year’s shareprice rally, hopes are high
that Nestlé’s new chief exec-
utive, Mark Schneider, will
announce a similar shake-up
at his first “investor seminar” next month.
These hopes seem ripe for
disappointment. Mr. Schneider has stressed the need to
balance cost savings with investment in new products.
He has already committed to
achieving “mid-single-digit”
growth by 2020; pursuing a
punchy margin target at the
same time would leave little
room to maneuver such a
large company, particularly
following weak second-quarter numbers. Mr. Loeb’s
1.29% stake is hardly a game
changer.
Nestlé’s stock trades at a
premium to Unilever’s, even
though prospects for earnings growth look better at
Unilever. Mr. Schneider has
been doing his best to damp
expectations; his latest results commentary was notably downbeat. If he does unveil a big package of reforms
the stock could jump. But investors are probably better
off preparing for another
dose of reality.
—Stephen Wilmot
OVERHEARD
According to the “Urban
Dictionary,” “Kanoa” is slang
for having your girlfriend stolen by someone good looking.
“I went to the gym with my
girl and I got Kanoa’d” is the
sample sentence.
Kanoa may soon become
slang in Silicon Valley for losing money that was given to
a startup.
A company with the name
Kanoa had raised funds by
offering a set of its planned
high-tech Bluetooth earphones for upwards of $150,
a 50% discount for paying up
front for a nonexistent product.
The promised earphones
were supposed to arrive
about a year ago, but now
the company says it is going
out of business and they
never will.
“Over the past 2 years you
have joined Kanoa on this
journey to create something
special,” reads a message on
its website, explaining that
they were “emotionally overwhelmed” with the turn of
events and that they “genuinely tried.”
Another Noble Mess Emerges, This Time in Derivatives
When things go wrong, insurance policies are supposed to pay out. In the case
of Singapore-listed Noble
Group, a commodity trader
fallen on hard times, that is
proving complicated.
Noble has suffered a grim
couple of years, with earnings slumping and its market
value diving amid questions
over its accounting. Still, it
managed to roll over billions
of dollars worth of debt earlier this year and persuaded
its bankers to extend its
credit lines.
But should these deals to
extend its repayments be
counted as a credit event?
That is now being debated
by those who bought and
Not So Noble
Annual cost to insure $10 million
of Noble Group’s debt against
default for 10 years
$8 million
6
4
2
0
’08
’10
’12
’14
’16 ’17
Source: Thomson Reuters
sold derivative products designed to insure investors
against any default by Noble
on its bonds. Such credit default swaps were among the
instruments that helped exacerbate the 2008 global fi-
nancial crisis.
Investors have been selling CDS on Noble’s debt recently, in effect betting that
it wouldn’t default. As of late
July, over $1 billion of CDS
had been written on Noble’s
debt with almost $160 million potentially owed to buyers, according to the International Swaps and Derivatives
Association.
As banks and investors
that bought protection—
among them Goldman
Sachs, Deutsche Bank and
J.P. Morgan Chase—lose
ever more confidence in Noble, they are arguing its debt
extensions should trigger
payouts: Several have served
so-called credit event no-
tices.
Enter ISDA again: Since
the financial crisis, it has
been charged with adjudicating on whether credit events
have occurred. But earlier
this month it said it didn’t
have enough information to
determine whether Noble’s
recent deals represent a
credit event and couldn’t get
hold of the underlying documentation “despite several
efforts to do so.”
To be fair, Noble’s situation isn’t clear-cut. The company says it is looking for
“strategic alternatives”—
code for seeking investors.
Propped up by lenders, the
company has remained on
life support, despite consis-
Edison
International
6.70
CenterPoint
Energy
4.16
Dominion
Energy
2.89
Exelon
2.16
AES
-0.36
2017
*Through Monday
Slow Food
2005
PG&E
7.511
2.5
FINANCIAL ANALYSIS & COMMENTARY
Source: Nestlé via Liberum Capital
Consolidated
Edison
8.50
2017
Nestlé Needs New Growth Recipe
Finding a leaner, meaner
recipe for growth at food giant Nestlé could take longer
than investors like New York
activist Dan Loeb seem to
think. It may be wise to
brace for disappointment.
The “Nestlé model” used
to involve generating organic
sales growth in a loosely targeted range of 5% to 6% by
selling a diverse portfolio of
food brands in just about every country in the world. For
years the model worked
wonders, helped by the
emerging-markets boom.
But by 2016 growth had
slowed to just 3.2% and has
been more sluggish again
this year. With growth only
matching cost inflation, the
operating margin has stalled
at 15.8%.
Easing inflation has been
one reason for Nestlé’s slowdown, but more worrisome is
the competitive trend. In developed markets, consumerproducts companies are increasingly caught between
disruptive, digitally marketed
brands at the high end—and
supermarkets’ private-label
products at the low end.
A $1 rise in a
component's
stock is equal
to a 0.79
point rise in
the index.
Aug.
HEARD ON THE STREET
Email: heard@wsj.com
NextEra
Energy
24.74
tently negative cash flows.
But the Noble affair has
exposed the limitations of
the resolution system for
disputes over CDS. If ISDA’s
adjudicating committee fails
to make a decision again,
buyers of Noble CDS will be
unable to get sellers to pay
up. The fact that the committee is composed of lawyers that are often from
banks and investors with a
financial interest in Noble’s
CDS leaves it open to criticism from both sides.
The reality, though, is that
this situation could end up
in the courts—hardly a great
advertisement for the muchmaligned credit default
swap.
—Anjani Trivedi
American
Water
Works
Company
7.12
NiSource
3.83
PSEG
2.56
FirstEnergy
1.34
Southern Co.
-0.80
THE WALL STREET JOURNAL.
WSJ.com/Heard
Will Harvey
Soak Auto
Insurers?
Most of those cars seen
floating or submerged in pictures from Houston this
week are auto-insurance
claims waiting to happen.
Harvey may be remembered as the biggest storm
that had the smallest impact
on the insurance industry.
That is because most damage
was caused by flooding,
which is mainly covered by
the federal government.
Auto insurance does cover
flood damage, which is why
shares of the big auto insurers in the region are down
more than those of other insurers. Still, the stocks haven’t fallen much.
Auto insurers with the
biggest Texas market share
include State Farm, an unlisted mutual insurer owned
by policyholders, as well as
listed companies Allstate
with a 12% share, Berkshire
Hathaway’s Geico with 10%
and Progressive with 9%, according to analysts at Morgan Stanley.
Allstate and Progressive
were among the biggest decliners among insurers Monday, falling 1.5% and 2.3%, respectively. Both shares were
up slightly Tuesday.
So far these mild declines
seem about right because investors know that insurers
have ways to limit their risk.
Allstate, for instance, has
substantial protection from
reinsurance, notes Barclays
analyst Jay Gelb. “The ultimate impact on insurers and
reinsurers is likely to be absorbable within a single
quarter of earnings for most
major insurance companies,”
Mr. Gelb said.
However, with Allstate and
Progressive up 22% and 33%
this year, even a modest hit
could knock the shares down
further. Investors may want
to stay away until the clouds
finally part.
—Aaron Back
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