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Umm, like the dog that caught the car?
With apologies to Ricky Ricardo, SBF still has some "splainin' to do."
I want to set the record straight.
— Alex Hoehn-Saric (@HoehnSaricCPSC) January 11, 2023
Contrary to recent media reports, I am not looking to ban gas stoves and the @USCPSC has no proceeding to do so. Read my full statement: pic.twitter.com/bYS1GLEpXP
From Tom Brady to Kevin O'Leary, here are 12 famous backers of FTX set to be wiped out in the exchange's stunning collapse
https://markets.businessinsider.com/news/currencies/ftx-bankruptcy-top-investors-list-tom-brady-kevin-oleary-sbf-2023-1
Sex, Lies and McDonald’s Regulatory Reckoning
The SEC hasn’t fined the company, but its probe into the dismissal of its former CEO has serious regulatory implications for corporate America.
January 10, 2023 at 11:26 AM
The saga at McDonald’s Corp. continues.
Yesterday, the Securities and Exchange Commission charged Stephen Easterbrook, the company’s former CEO, with making false and misleading statements about relationships with female employees that led to his firing in November 2019. Easterbrook agreed to a five-year ban on being an officer or director at a US public company and a $400,000 civil penalty.
Despite the charge, the company walked away with no financial penalty. The SEC justified the decision by pointing to the company’s “substantial cooperation” and the “remedial measures” it had already taken. (In December 2021, Easterbrook agreed to pay McDonald’s $105 million after the company sued him to claw back compensation.)
Maybe it’s the lack of a monetary fine, its technical nature, or simply that it’s not as juicy as the Easterbrook part of the narrative, but somehow the charge against McDonald’s has ended up as a footnote in the whole ordeal. It should be the main attraction. The charge turns the sordid affair from a McDonald’s story with leadership and management lessons into one with serious regulatory implications for corporate America about what it must disclose to investors.
Here’s the backstory: When McDonald’s fired Easterbrook in 2019 for sexting with an employee, it said he had violated company policy and demonstrated poor judgement. However, the board decided not to fire him for cause, allowing Easterbrook to walk away with more than $40 million in severance and compensation. Less than a year later, a whistleblower ignited a further investigation that discovered Easterbrook had in fact had multiple sexual relationships with employees in the year before his departure and allegedly attempted to cover them up during the initial investigation. McDonald’s sued Easterbrook and subsequently said that had it known this information when it fired him, it wouldn’t have terminated him without cause.
The with or without cause piece is what’s critical in the SEC investigation of the company. The agency is saying that the “shortcomings” in McDonald’s public disclosures stem not from deciding to fire Easterbrook without cause, but rather from its failure to disclose that the decision to do so was at the board’s discretion.
This might seem like a technicality, but it’s by no means a stretch to say that having the information is relevant to investors. Firing Easterbrook without cause casts a light on the board, revealing material information about its thinking and process. That decision has in fact made the company a target of a shareholder group, which has called for a refresh of the board — including Chairman Rick Hernandez, who is a long-time director. McDonald’s has made some apparent concessions, adding four new board members since Easterbrook’s departure. However, all but one of the directors who oversaw the Easterbrook investigation remain on the board.
The SEC’s decision comes with its detractors. Two of the SEC’s own commissioners dissented — something that historically was rare but has become far more common in the last decade — calling the order a “novel interpretation’’ of the agency’s disclosure rules. Their argument is that requiring a company to disclose the underlying reason for why it chose to terminate with or without cause is beyond the scope of the rules and has the potential to lead to confusion.
Neither McDonald's nor Easterbrook have denied or admitted to the SEC's findings.
The kind of deal McDonald’s cut with Easterbrook is far from unusual. When facing a crisis in leadership, companies want to move on quickly and quietly, and both sides have powerful incentives to settle. McDonald’s made just that claim in its suit against Easterbrook, saying that its decision to terminate without cause was an attempt to protect the company’s interests and create as little disruption as possible. It was very likely part of the negotiation in Easterbrook’s exit.
The SEC’s order now makes that point of negotiation less readily available for companies that are separating from an executive. What organizations say about a CEO’s departure is not just a business decision but a clear regulatory issue. Boards will have to be more candid and transparent in their disclosures, further pulling back the curtain on their deliberations. The message from the SEC is very clear: be forthright, or risk deep scrutiny.
-- Bloomberg
During my time as a teenage sous chef, I labored over majestic, gas-burning Wolf and Viking stoves in large commercial kitchens. I have to wonder if I was unwittingly exposed to high volumes of certain noxious gases throughout those brief years of foodservice; at the time, cooking seemed a relatively harmless task, and none of the career chefs I worked with displayed any ill-effects, to my knowledge. But of course, positioned over every commercial stove is a massive commercial exhaust system that works very well at its task of venting fumes and odors away from food preparation areas (just ask the neighbors!), so perhaps worker exposure in the kitchen is minimal. I can't imagine sautéing hundreds of orders over electric burners in a single shift; I entered the industry working over gas, and I left the industry working over gas. It'll be a challenge for professional cooks to adapt to a ban in commercial kitchens, no matter how large or small the setting, should they even eventually have to.
"Gas stoves, particularly those without great ventilation or if homeowners are slack in using their vents, emit air pollutants such as nitrogen dioxide, carbon monoxide and fine particulate matter at levels the EPA and World Health Organization have said are unsafe and linked to respiratory illness, including asthma, cardiovascular problems, cancer, and other health conditions. That’s according to reports by groups such as the Institute for Policy Integrity and the American Chemical Society."
"That price alone says that if the company does end up staying in business, it's only going to be after wiping out all of the equity and a very large chunk of the debt."
https://www.axios.com/2023/01/10/bed-bath-beyond-share-price-bonds
Allen Weisselberg is expected to receive a sentence of five months at New York City’s Rikers Island jail complex, followed by five years’ probation.
By Corinne Ramey
Jan. 10, 2023 7:00 am ET
Former Trump Organization finance chief Allen Weisselberg is set to be sentenced Tuesday for tax crimes he committed at the company, after serving as the star witness in a tax-fraud trial that resulted in the conviction of his longtime employer.
Mr. Weisselberg, 75 years old, pleaded guilty in August to 15 felonies for participating in a scheme to compensate certain Trump Organization employees, including himself, with off-the-books benefits to evade taxes. Mr. Weisselberg also admitted that from 2005 through 2021, he failed to report $1.76 million in benefits to tax authorities. This unreported compensation came in the form of a rent-free Manhattan apartment, multiple leased Mercedes-Benz cars, home furnishings and private-school tuition for his grandchildren, Manhattan prosecutors said.
Under the terms of Mr. Weisselberg’s plea agreement with the Manhattan district attorney’s office, he is expected to receive a sentence of five months at New York City’s Rikers Island jail complex, followed by five years’ probation, in exchange for testifying truthfully at the Trump Organization’s trial. He will also be required to pay about $2 million in taxes, penalties and interest to New York City and state tax authorities.
When the Trump Organization went on trial this fall for tax crimes, Mr. Weisselberg told jurors that he knew that off-the-books benefits were being paid and that some perks had been authorized by Donald Trump himself.
A prosecutor asked why he hadn’t disclosed the tax arrangement to his accounting firm.
“They wouldn’t sign my tax return and prepare it,” he told the jury.
Following the trial, two Trump Organization entities were convicted of tax fraud and other offenses. They are scheduled to be sentenced on Friday, facing a maximum fine of about $1.6 million. Mr. Trump wasn’t charged in the case.
Lawyers for the company have said they would appeal. Mr. Trump has said the case was politically motivated. Company defense attorneys said the former president relied on an outside accounting firm.
To prepare for the sentencing, Mr. Weisselberg hired consultant Craig Rothfeld, founder of prison advisory firm Inside Outside Ltd. Mr. Rothfeld, who has served time in prison himself, said much of what he told Mr. Weisselberg was related to day-to-day jail life that is a mystery to those on the outside: the process of going from court to Rikers on Tuesday, and expectations around phone calls, food, packages and books.
He said to spoke to Mr. Weisselberg about safety at Rikers. “It’s one of these unwritten codes that people who are over 60 years old are accorded a different level of respect,” Mr. Rothfeld said. “I just told him, ‘Keep to yourself, don’t insert yourself into conversations that you’re not a part of, and be respectful to everybody.’”
-- Wall Street Journal
The problem that has pushed me further away from crypto at a time when I wanted to be liking it more than ever is not the controversy stemming from Sam Bankman-Fried and the collapse of FTX, the never-ending headline risk or performance so miserable in 2022 that it made other declining assets like stocks and bonds look like big winners.
It’s that crypto didn’t do the any of the jobs that its supporters tell me it should do, and there is no reason to think that trend will change.
I am not expecting my thinking to change the mind of true believers. Bitcoin BTCUSD, 0.48% and ethereum ETHUSD, 1.11% and their competitors have attracted plenty of HODLers — investors who “hold on for dear life” — who are still in despite seeing their crypto assets cut by roughly 66% in 2022, and they may prove to be the long-term victors. Indeed, many of them have been clutching on to crypto for so long that they remain in plus territory despite the recent downturn.
But crypto enthusiasts won me over just a little bit a few years ago, when I started including crypto in my year-ahead planning and decision-making. Just getting into the discussion was a victory, and that happened because a lot of smart, savvy investors were telling mainstream customers to dip toes into the bitcoin pool.
The idea, of course, was that crypto had a few functions. It could be a digital alternative to gold, some said, helping as a hedge against inflation. It was unregulated and could withstand global economic and political crises better than traditional currencies, according to other experts. It was the wave of the future and would eventually be accepted everywhere.
But none of those things actually happened.
Gold GC00, 0.10% is the traditional hedge for inflation, but it hasn’t worked well at all since prices started rising globally. Recently, gold has functioned better as a hedge against geopolitical uncertainty; as such it could find a place in many portfolios.
But crypto hasn’t been an alternative to gold on balancing out inflation, and its de-centralized, unregulated status hasn’t helped it during times of societal unrest.
Liz Ann Sonders, chief investment strategist for Charles Schwab & Co., said in a recent interview on my podcast “Money Life with Chuck Jaffe” that she asks crypto enthusiasts to “explain to me what problem crypto is solving for,” and most often gets inflation and other reasons for why the new currencies are better than the old ones.
“In the meantime,” she said, “we have the biggest outburst of inflation in 40 years and guess what became the ultimate inflation hedge? It was the fiat currency that is the U.S. dollar.”
Legendary mutual fund manager Ralph Wanger — who ran the Acorn Fund for over 30 years and who, at nearly 90 years old, still watches the market — said on my show last week that crypto “was a solution in search of a problem,” but if it’s not solving a problem, then it doesn’t have a role, at least not in my portfolio.
https://www.marketwatch.com/story/i-now-definitely-wont-go-near-crypto-but-not-because-of-the-alleged-ftx-fraud-11673288156?
As some reasonably valid points are made here, I would look forward to reviewing a rebuttal to the rebuttal, further touching on, for example, the "cause/without cause" issue, fleshing out 402 a bit more, and otherwise advancing an understanding as to why the Commission's "expansive" regulatory requirements are the threat to democracy that the authors here seem to imply (and Peirce, in particular, seems altogether too prickly these days..."The lady doth protest too much, methinks" - Hamlet).
The Big Mac? No, the Big Slap.....
SEC Charges McDonald’s Former CEO for Misrepresentations About His Termination
Fast Food Company Charged for Public Disclosure Violations
https://www.sec.gov/news/press-release/2023-4
LOL! Once again, Paulie nails it.....
Yee-haw.....
Ha! This brought back a memory. Back in 1986, I drove my girlfriend's ground-hugging Porsche from sea-level all the way up to Stanford Sierra Camp at Fallen Leaf Lake. Then, overnight, the first snow of the season drops. Oops! Wrong car to have picked for a trip like that. I somehow eventually dug out from under several feet of the Sierra's best icy white stuff (without any help - I was too embarrassed to call anyone), somehow managed to get the frozen, finicky engine started, and was eventually able to slink my way back down the hill without attracting too many disapproving glances from the locals in their 4x4s (and I was relieved that the girlfriend had remained behind - she had been skeptical enough about me as things stood already). As a Sierra skier and CA native, I should have known better than to try to outfox the weatherman, fickle Sierra snowfall, or the peril that can result when a low-clearance motor vehicle collides with youthful arrogance.
After that, the sports car remained at sea level. Though I'm sure the crafty Germans have figured out the best ways to navigate their snowy landscapes with their beautiful passenger cars. Although I daresay that my trusty old 36-HP VW Beetle, which once got this teenager across the Nevada desert with a cracked crankshaft, would have been more welcome in the snow than that pampered Porsche. Embarrassment and shame can be a powerful motivator, and I've used trucks and SUVs (almost) exclusively in my beloved Western mountains ever since, snow season or not.
You're on the right track, correctly assuming that I was making a simple allusion to something larger - but in this case, it was a cryptic, celebratory acknowledgment of the greatness of Pele'. (And by the way, I enjoyed learning a bit more about Russian history.)
In his 21-year career, Pelé — born Edson Arantes do Nascimento — scored 1,283 goals in 1,367 professional matches, including 77 goals for the Brazilian national team.
Many of those goals became legendary, but Pelé’s influence on the sport went well beyond scoring. He helped create and promote what he later called “o jogo bonito” — the beautiful game — a style that valued clever ball control, inventive pinpoint passing and a voracious appetite for attacking. Pelé not only played it better than anyone; he also championed it around the world.
Among his athletic assets was a remarkable center of gravity; as he ran, swerved, sprinted or backpedaled, his midriff seemed never to move, while his hips and his upper body swiveled around it.
He could accelerate, decelerate or pivot in a flash. Off-balance or not, he could lash the ball accurately with either foot. Relatively small, at 5 feet 8 inches, he could nevertheless leap exceptionally high, often seeming to hang in the air to put power behind a header.
Like other sports, soccer has evolved. Today, many of its stars can execute acrobatic shots or rapid-fire passing sequences. But in his day, Pelé’s playmaking and scoring skills were stunning. --- NY Times
Large or small, fortunes are good. Cintas is a good example of the returns possible with a garden-variety buy-and-hold strategy (another is AZO). Although, I'm mildly surprised CTAS stock hasn't attracted greater institutional interest.
Ain't that the truth.....
Good point about investors - remember this list I sent you awhile back? It explains much.......https://thedecisionlab.com/biases
Good point - and who can ever forget that Ackman - Herbalife debacle? LOL! Wheeeee!
Touche'!
Yet she seems to have enough of a magic touch, with enough investors, to keep her job.....
They may be thinking, "lesson learned."
But, then again.....nah, not really...
KALA, aka Portfolio Fattener
As our elders might say back in the day, the two Tate brothers were getting "too big for their britches," and made too many unforced errors. The world needs to be free of their venom.
LOVE IT!
PALI has certainly delivered like a pal.....
The Persistent Problem Of Human Trafficking
https://www.justice.gov/opa/pr/owner-farm-labor-company-sentenced-118-months-prison-leading-multi-state-conspiracy-involving
I think that we shall never see,
A liar quite as bold as he.
With zero life and quite unfit,
He's just another maga twit.
--- WAPO reader comment to Santos article
Skills on the level of what Andrew Tate is gonna need?
Ummm.....did he play soccer? As good as Pele?