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Jun 1, 2012

Breakingviews: Fake exclusive: Zuckerberg memo to Facebook staff

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

By Rob Cox

NEW YORK, June 1 (Reuters Breakingviews) – Facebook billionaire Mark Zuckerberg will soon return from his Italian honeymoon to face troops coping with the company’s busted initial public offering. The near-30 percent plunge in the stock from its debut price, along with the resulting media and regulatory scrutiny, has tarnished the company’s reputation and equated a firm built to accomplish a social mission with the greed of Wall Street. His message to employees should be humble, clear and ambitious at the same time. Using Zuckerberg’s own pre-IPO words, Breakingviews has penned a sample memo ahead of a likely real one that it wouldn’t be surprising to see turn up in the media next week.

Jun 1, 2012
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Fake exclusive: Zuckerberg memo to Facebook staff

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

Facebook billionaire Mark Zuckerberg will soon return from his Italian honeymoon to face troops coping with the company’s busted initial public offering. The near-30 percent plunge in the stock from its debut price, along with the resulting media and regulatory scrutiny, has tarnished the company’s reputation and equated a firm built to accomplish a social mission with the greed of Wall Street. His message to employees should be humble, clear and ambitious at the same time. Using Zuckerberg’s own pre-IPO words, Breakingviews has penned a sample memo ahead of a likely real one that it wouldn’t be surprising to see turn up in the media next week.

May 29, 2012
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Buffett steals insider-trading show in absentia

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By Rob Cox
The following column appears in the May 28 edition of Newsweek magazine. The author is a Reuters Breakingviews columnist. The opinions expressed are his own.Even when he’s a no-show, Warren Buffett steals the show. And so it was that the billionaire Berkshire Hathaway chairman, even in his absence, dominated a New York courtroom where the fate of Rajat Gupta, the former McKinsey & Co chief charged with a slew of insider trading violations, was being determined. But it’s another insider trading situation involving Buffett that still has Wall Street riveted: the curious case of his former heir apparent, David Sokol.

Buffett was more a bystander than a participant in the Gupta affair. Though Gupta might have adhered to McKinsey’s vows of discretion when he ran the place, he’s accused of sharing sensitive information he obtained as a Goldman Sachs director with the now-jailed hedge fund manager Raj Rajaratnam. Seconds after a Goldman board call during the 2008 financial crisis, Gupta allegedly tipped off Rajaratnam that Buffett was about to inject $5 billion of fresh capital into the Wall Street firm.

May 25, 2012
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JPMorgan’s board could use some new blood

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

It takes a lot for Citigroup and Bank of America to make JPMorgan look deficient. Jamie Dimon’s Paleolithic board does just that, though. Last week’s protest vote and the rising losses from knuckle-headed trades at its chief investment office highlight the need for JPMorgan to recruit some new directors to help keep the boss on his toes.

May 23, 2012
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One reason for Facebook IPO mess: Zuck didn’t care

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

Facebook has reminded investors of a simple lesson: Avoid companies whose bosses don’t care about you. From the get-go, Mark Zuckerberg, the social network’s not very sociable founder, made clear he had little interest in welcoming public shareholders. That indifference set a tone for his executives, venture capitalists and bankers that arguably contributed to the glaring flaws in Facebook’s initial public offering last week.

May 22, 2012
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The business of ice hockey has never been so good

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By Rob Cox
This column appeared in the May 21 edition of Newsweek magazine. The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

It must be killing Gary Bettman to keep so much good news on ice. The National Hockey League is Bettman’s business, and business is the best it has been since he became its commissioner nearly 20 years ago. Thanks to ferocious competition inside the rink and the biggest broadcasting commitment in league history, more Americans are debating the finer points of penalty kills and two-line passes than ever.

May 21, 2012
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JPMorgan loss kicks succession race into high gear

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By Rob Cox
This column appeared in the May 21 edition of Newsweek magazine. The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

A time-honored tradition for handling executive succession on Wall Street is the practice of putting two ferrets in a sack, figuratively speaking. That’s when a bank takes two promising managers and makes them co-heads of the same business. The expectation is that, like two feral mammals clawing each other in the darkness, one will emerge victorious. He will become CEO. The other is named deputy vice chairman of Bolivian equities. JPMorgan has yet to officially haul out the burlap sack, but the $2 billion trading loss it disclosed two weeks ago has accelerated the contest to succeed Jamie Dimon at the top of America’s biggest financial institution.

Not that Dimon is leaving anytime soon. His hair may be silver, but he’s only 56 and has every intention of running the place into his 60s. Moreover, the losses from bets on funky derivatives incurred by the chief investment office in London look manageable for a bank that minted a $5.4 billion profit in the first quarter and boasts nearly $200 billion in capital. But as Dimon readily admits, the trades were dumb. They certainly undermined many of his public arguments for resisting additional regulation of the banking industry. As a consequence, the question of who will one day fill Dimon’s wingtips has become a money-industry parlor game.

May 11, 2012
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Dimonfreude is irresistible, but may be dangerous

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By Rob Cox

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

It’s easy to sympathize with the collective glee that greeted JPMorgan’s shock revelation of some $2 billion of trading losses. The bank and its chief executive Jamie Dimon have received their long-awaited comeuppance. But this emotion – Dimonfreude, if you will – is dangerous. If one of the few big banks that managed to sidestep most of the credit crisis is proven fallible, confidence in the system itself will be shaken.

May 7, 2012
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When shareholder democracy trumps the real thing

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By Rob Cox
The author is a Reuters Breakingviews columnist. The opinions expressed are his own. This column appears in the May 14 issue of Newsweek.

It’s worrying to think that shareholder democracy is needed to rectify shortcomings of the real thing. Yet this week two of the nation’s biggest corporations will give their investors precisely that opportunity. Motions on the ballots at the annual meetings of Bank of America and 3M will effectively act as referendums on the U.S. Supreme Court’s flawed decision in the Citizens United case to effectively hand companies the same freedoms of speech accorded to people. Happily, supporting proposals to restrict the use of corporate money in politics isn’t just good for democracy, it is good business.

May 2, 2012
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Even Predators’ Ball saves a dance for 99 pct

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

It’s easy to spot vestiges of the old Predators’ Ball at this year’s Milken Institute Global Conference. The Ferraris and Bentleys jamming the Beverly Hilton driveway, for example, are evocative of the annual shindigs that Michael Milken put on for his Drexel Burnham Lambert clients in the go-go 1980s. Yet there’s a consensus emerging even among this elite demimonde that the rising disparity between the rich and the rest is a problem in need of attention. They disagree, however, on the solutions.

    • About Rob

      "Rob Cox helped establish Breakingviews in 2000 in London. From 2004 he spearheaded the firm's expansion in the United States and edited its American edition, including the daily Breakingviews columns in the New York Times and Wall Street Journal. Rob has worked as a financial journalist in London, Milan, New York, Washington, Chicago and Tokyo. Rob graduated from Columbia University’s Journalism School and the University of Vermont. Follow Rob on Twitter @rob1cox"
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