Reuters blog archive

from Alison Frankel:

Pershing, Valeant: Allergan ignored Goldman advice to talk

One of the most interesting supporting actors in the Allergan takeover drama is Goldman Sachs, which is a financial adviser (along with BofA Merrill Lynch) to the Botox maker. Goldman is known for defending takeover targets, so it made sense when Allergan brought in the bank to help it fend off a joint hostile advance from the Canadian pharmaceutical company Valeant and the hedge fund Pershing Square.

But as David Gelles reported for the New York Times in June, Goldman has been unusually quiet in the Allergan battle, and for an unusual reason: In June 2013, Goldman was the sole underwriter on a $2.3 billion Valeant stock offering to raise money for its acquisition of Bausch & Lomb, a Goldman client. Goldman even invested $300 million of its own money in the Valeant offering, according to the Times story. Goldman, in other words, had a different view (at least in June 2013) of Valeant's business model than Allergan's board has been loudly proclaiming for the past six months.

And according to a new filing by Pershing and Valeant, Goldman may also have had a different view than Allergan's directors on how Allergan should have responded to their offer.

Pershing and Valeant have asked U.S. District Judge David Carter of Riverside, California, for permission to amend their counterclaims in the Allergan suit accusing Pershing of insider trading. Monday's filing adds some new accusations, based on depositions of Allergan directors and advisors and about 4,200 documents Allergan produced in discovery, to what Valeant and Pershing previously asserted in August. Perhaps the most provocative of them is that Allergan disregarded advice from its advisers, specifically, Goldman.

from Photographers' Blog:

Inside the prison actors studio

Norco, California
By Mario Anzuoni

Recently I was granted access inside a California state prison to photograph the Actors’ Gang Prison Project final presentation. The project is funded by the California Department of Corrections and Rehabilitation and aims to rehabilitate inmates through the arts.

Inmates participate in the workshop "Commedia Dell'Arte", part of the The Actors' Gang Prison Project program at the California Rehabilitation Center in Norco

The California Rehabilitation Center is located in Norco, about 60 miles east of Los Angeles, only a couple of blocks from a dense residential area, and houses more than 3,000 inmates.

from Reuters FYI:

Dairy divas

A farmer lifts the trophy next to the cow that was just crowned Miss Milk Cow 2014 during the annual milk cow beauty contest in Moc Chau plateau, October 15, 2014.   REUTERS/Kham/Files

A farmer lifts the trophy next to the cow that was just crowned Miss Milk Cow 2014 during the annual milk cow beauty contest in Moc Chau plateau, October 15, 2014. REUTERS/Kham/Files

Milking the prize for all it's worth

Now here's a much more entertaining pageant: An annual bovine beauty contest in Vietnam.

from Data Dive:

Why the U.S. is spending $1 trillion on nukes


Here's a fun post to take your mind off Ebola and Washington's myriad foreign policy problems.

A mere five years ago, in the announcement awarding President Obama the 2009 Nobel Peace Prize, the Norwegian Nobel Committee said it "attached special importance to Obama's vision of and work for a world without nuclear weapons."

from Breakingviews:

Fragility is bigger worry than volatility for the markets

By Rob Cox

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

It has been impossible to escape the V-word for the past week. Turn on the television, and it is easy to conclude that central bankers, corporate chiefs, investors and politicians think volatility is the biggest problem vexing global markets. The rollercoaster ride recently experienced by financial assets is nettlesome. But it’s merely a symptom of a bigger malady: the fragility of widely accepted assumptions about where the world is headed.

from Global Markets Forum Dashboard:

FX positioning storing up potential for reversals?

European shares surged today, while the euro dipped and the region's bond yields fell after European Central Bank insiders told Reuters the bank was readying a plan to buy corporate bonds - not quite the full-blown buying of government debt that markets are clamouring for to lift the economy and stave off deflation, but nonetheless still something that would be a major step for the ECB. 

While any move to loosen policy further would likely see the  euro head  lower,  the absence of a formal announcement of any such corporate bond buying programme, means the euro still has the potential to rally in the short-term, our forum guest this morning said.

from Breakingviews:

FX business now shares equities’ harsh economics

By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Currency trading is taking over from equities as the challenged business in investment banking. Resurgent volatility in foreign exchange markets during September and October is unlikely to offer more than a temporary respite for the business.

from Breakingviews:

Hong Kong tycoons can be part of protest solution

By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Hong Kong’s tycoons could be part of ending the standoff with pro-democracy activists. The city’s business leaders have an outsize influence over local politics. Relaxing their grip on special corporate votes could ease divisions over electoral reform as well as tensions over rampant inequality.

from MacroScope:

Nearing a gas deal

A pressure meter and gas pipes are pictured at Oparivske gas underground storage in Lviv region

Russian and Ukrainian energy ministers are due to meet European Energy Commissioner Guenther Oettinger in Brussels after presidents Petro Poroshenko and Vladimir Putin said they had agreed on the "basic parameters" of a deal to get gas flowing to Ukraine again this winter.

Russia cut off gas supply to Ukraine in mid-June following more than two years of dispute on the price and said Kiev had to pay off large debts for previously-supplied gas before it would resume supply.

from The Great Debate:

Islamic State’s rules of attraction, and why U.S. countermoves are doomed

Demonstrators hold placards outside the U.S. embassy near to where a 9/11 anniversary memorial was being held in central London

The U.S. State Department is producing anti-Islamic State propaganda to persuade American and other would-be jihadis not to join the extremist group. It’s ham-handed, and often sarcastic, and unlikely to have the intended effect.

Why? Because the department fails to understand how Islamic State attracts recruits in the first place.