Bloomberg News

Hollande’s Dinner Plans Include Putin, Obama, BNP: Opening Line

June 05, 2014

Wonder if Francois Hollande is going to eat at both of the dinners he’s hosting separately in Paris tonight for Obama and Putin. The food is pretty good at Elysee Palace, one person’s opinion notwithstanding, and France’s president doesn’t look like he’s wrestling with a diet.

Although it’s hard to get a bite in when you’re talking a lot, and it sounds like Hollande is going to give Obama an earful for enforcing U.S. law against BNP Paribas -- a penalty that has sparked calls for BNP Chairman Baudouin Prot to resign, the Wall Street Journal reports this morning.

The French aren’t happy about the BNP mess, which means Hollande isn’t happy about it. If the French were happy about it, he’d be happy about it. With an 18 percent approval rating, you pretty much do what you’re told.

The other day, UMP lawmaker Jacques Myard complained about the potentially $10 billion BNP is going to have to pay if it wants to keep doing business here, saying the U.S. “has the annoying habit of trying to apply its laws outside its jurisdiction.”

We’ll look past the fact that the banking BNP did for those countries was transacted in dollars, which makes it U.S. jurisdiction, and head right to Ira Einhorn.

Einhorn, a friend and contemporary of Abbie Hoffman, killed his girlfriend in Philadelphia in 1977 and stuffed her body in a trunk, hiding it in the apartment they shared. After it was discovered and he was arraigned, he jumped bail and was finally found in southwestern France about 20 years later, living the life of a country gentleman in Champagne-Mouton with his Swedish girlfriend. (This one was still breathing.)

Even though Einhorn’s crime was committed when Pennsylvania didn’t have a death penalty law, and because they don’t recognize trials in absentia -- which is how he had been convicted -- France and its courts refused to extradite him.

The only reason he’s in prison now is because France forced Pennsylvania’s law to give him a new trial.

***

The ECB’s rate decision today at 7:45 a.m. EDT probably won’t have many surprises. Alessandro Speciale and the gang in Frankfurt have put together an outlook for you, with explanations of various possibilities, which you can find here.

Negative deposit rates may not be enough, Stefan Riecher and Jeff Black report. While he may not announce quantitative easing today, they write, it will be within reach.

And what Mario Draghi decides in Frankfurt could have implications for the next move out of Mark Carney, who’s facing kind of the opposite problem Draghi has: more than enough inflation, especially in housing.

“If Draghi announces something quite big, we could see sterling appreciate, and that lowers future inflation risk for the U.K.,” Azad Zangana, an economist at Schroders in London, tells Jennifer Ryan today. “That means there’s a greater chance of delay in tightening.”

***

U.S. economic numbers today include Challenger’s job cuts at 7:30 a.m. EDT, initial jobless claims at 8:30 a.m., Bloomberg consumer comfort index at 9:45 a.m., and change in household net worth at noon.

***

Sprint (S:US) has moved on T-Mobile US (TMUS:US), arriving at a cash-and-stock price that approaches $40 a share, or about $31 billion.

SoftBank’s Masayoshi Son, which owns 80 percent of Sprint, is trying to sell the deal to regulators as essential to competing with AT&T and Verizon, and if Comcast-Time Warner Cable goes anywhere, his purchase wouldn’t seem so outlandish. Plus you know Google’s going to be a phone company any day now.

Deutsche Telekom, owner of about 67 percent of T-Mobile, is up about 1.1 percent this morning in Frankfurt.

***

GM is scheduled to release an internal report today on its recall debacle. Mary Barra will hold a town-hall style meeting with employees starting at 9 a.m. New York time in Warren, Michigan, to outline the report by Anton Valukas.

Jamie Butters, team leader for auto coverage in the U.S., tells us he’s looking out for any estimate of what compensation is going to cost shareholders and whether anyone gets fired and, if anyone does, how high up the firing goes.

“Is Barra exonerated or simply not implicated?” he wonders.

“Valukas will probably conclude the failures were primarily the product of one engineer who did a bad job, covered it up and lied about it,” Butters says. “But it’s never just one thing, like the O-ring on the space shuttle. There were systemic failures, too -- the result of the legal department’s aggressively secretive strategy, generally poor communication within GM’s massive hierarchy, and Old GM’s obsession with cutting costs to reduce annual losses, especially on small cars.”

While today’s report is “a big step toward putting it behind them,” there’s more the company will have to face. The victim-compensation report from Kenneth Feinberg will probably come out in a couple weeks, there will be another round of House and Senate hearings, further legislation on vehicle safety, and the Justice Department’s criminal prosecution of the company and any employees, Butters says.

Referring to the $1.2 billion fine and three-years’ probation Toyota got under comparable circumstances, Butters says in this case he’d expect “something similar or bigger for GM, or even a lower-level employee being personally prosecuted.”

***

If you have plans this weekend that involve taking I-95 in either direction through Wilmington, Delaware, allow extra time or find another route. The bypass, I-495, is shut down for the foreseeable future while engineers figure out what to with the section of 495 that crosses the Christina River. Support columns on the span have shifted. All traffic is being dumped onto I-95 through the city and it could get ugly.

College graduates these days don’t emerge into the most ideal conditions. Janet Lorin finds some of the jobs they get aren’t worth the degrees they acquired.

Flexibility is required these days. Your kid (or you, if you’re reading this in college, in which case, call us because we want to know how and where) probably isn’t going to ease out of commencement and into that entry-level job in his or her chosen field of study like you or your parents did.

It might require a more circuitous route, and this might not be a bad thing.

Before King Arthur was King Arthur, he was Wart, a squire’s page. In the course of his education, the wizard Merlyn, knowing Wart’s fate was to be king, changed the boy into a fish, a goose, a badger, an ant and a hawk. The point was to give the future king a look at life from different sides, to experience things that would inform his wisdom later in life, when it’s needed most.

So to that grad with a brand new degree in marketing, or comparative literature (whatever that is; it just sounded good), or health sciences, go paint houses for a summer. Tend bar and get the hang of talking to people -- all people. One of them might hire you.

***

The NFL is going to revert back to Arabic numerals for the Super Bowl in 2016 -- “Super Bowl 50” -- and then back to Roman numerals after that? “Super Bowl LI”? Really?

Did you really think this through, Rog? Maybe this would be the perfect time to break with the Roman numerals. You are aware no one uses Roman numerals anymore, right? You guys are, like, the only ones. You guys and clocks.

But if you’re going to do the Roman numeral thing, own it. The scoreboard, the stats, all of it.

Final score:

GIANTS XVII

BEARS XXIV

“Tony Romo completed XXI of XXXI passes for CCLXII yards and III touchdowns, as DeMarco Murray gained CLII yards, his best game in IV years.”

***

The New York Rangers succeeded brilliantly in luring the Los Angeles Kings into a false sense of security in Game 1 of the NHL Stanley Cup finals last night, losing 3-2 in overtime after taking a 2-0 lead in the first period. Devious. Game 2 is Saturday night in L.A.

***

Yet far more people watch the NBA, whose finals begin tonight in San Antonio with the Spurs hosting the defending champion Miami Heat in a rematch of last year’s finals. As we did yesterday with hockey reporter Mike Buteau, today we get the overview from our NBA expert, Scott Soshnick.

We’re not as knowledgeable about the NBA as we are about, well, we’re not really knowledgeable about anything, frankly. But we get that this is a rematch, so the obvious question for Scott was what’s changed since June 2013.

“This is still the consistency and professionalism of the Spurs versus the superstar trio of the Miami Heat,” Soshnick says. “The recipe for Miami’s success has been the big three (LeBron James, Chris Bosh and Dwyane Wade) and anyone else. The recipe for San Antonio has been Tim Duncan, Tony Parker, Manu Ginobili and fill in the rest.”

It was pretty close last year, right?

“San Antonio -- you can easily make the case -- could have won the series. They were a dramatic, Chris-Bosh-rebound-and-Ray-Allen-three-point-shot from winning the championship,” Soshnick recalls. “The fans in Miami had left the building -- literally had left the building, and were trying like heck to get back in and missed arguably one of the greatest moments in their franchise’s history because they’d given up hope.”

Even though it’s been a while since the previous championship roster for San Antonio’s 2006-07 title, “you look no further than the coach and the star. It’s been that way for 15 years. It’s Gregg Popovich’s way, and everything revolving around Tim Duncan -- still. He’s still there. While LeBron is the greatest player on the planet, Tim Duncan can be the greatest player on the planet in short stretches when needed.”

And Soshnick’s call is...Rangers in six.

***

Don Zimmer has died. His foolish yet noble charge at Pedro Martinez will live on.

To contact the reporter on this story: C. Thompson in Wilmington at cthompson1@bloomberg.net

To contact the editor responsible for this story: Marty Schenker at mschenker@bloomberg.net


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