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Wallstreetjournal 20160111 The Wall Street Journal
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Wallstreetjournal 20160111 The Wall Street Journal
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* * * * * * MONDAY, JANUARY 11, 2016 ~ VOL. CCLXVII NO. 8 WSJ.com HHHH $3.00
Last week: DJIA 16346.45 g 1078.58 6.2% NASDAQ 4643.63 g 7.3% STOXX 600 341.35 g 6.7% 10-YR. TREASURY À 1 8/32 , yield 2.131% OIL $33.16 g $3.88 EURO $1.0926 YEN 117.26
AssaultsPutHeatonMerkel
announced Nov. 12, regulators
underestimating the number
representing 25 economies
of readers using its News app
agreed to adopt rules similar to
and passing the inaccurate in-
ones the Fed is developing, a
formation on to publishers. B1
united front intended to prevent
Kohl’s is debating whether financial firms from moving
to pursue steps such as tak- German chancellor’s lor Angela Merkel since she Meanwhile, a growing suspected attackers were mi- transactions offshore in re-
ing itself private or break- threw open Germany’s borders number of people, largely grants. sponse to tighter Fed rules.
ing up the company. B3 open-door migrant to refugees last summer. women, have reported being The assaults and fresh evi- Margin works as protection
Citigroup is pushing to policy is questioned at On Sunday, German officials robbed and sexually assaulted dence of other security risks for lenders financing securities
disclosed that the man French on New Year’s Eve by mobs of linked to migrants bring new purchases. If an investor wants
ramp up stock trading amid home and abroad authorities say tried to attack a what many described as difficulties to Ms. Merkel’s ef- to borrow $100 for a day, a
a slump in its traditional en-
Paris police station in an Islamic largely North African or Arab- forts to preserve her open- lender might ask the borrower
gines of trading revenue. C1
BY ANTON TROIANOVSKI State-inspired assault last week looking men. In Cologne, door refugee policy and get to post a bond worth $105, leav-
Alcoa plans to announce had been living at a German ref- where most of the assaults other European Union coun- ing a $5 margin in case the
a $1.5 billion long-term sup- COLOGNE, Germany—The ugee shelter—adding more fuel have been reported, police tries to agree on a common re- value of the bond drops.
ply contract with General aftershocks spreading from al- to a debate that has exploded said 516 complaints had been sponse to the migration crisis. Unlike earlier Fed margin
Electric’s aviation unit B3 legations of New Year’s Eve over the security threats tied to filed by Sunday—40% of them Please see MERKEL page A8 rules, which focused largely on
assaults by migrants in Ger- the arrival of more than 1 mil- for sexual offenses, including Please see FED page A2
World-Wide man cities have provoked the lion asylum seekers in Germany at least two rape allega- Professor’s views on Islam
biggest challenge to Chancel- over the past year. tions—and that many of the divide a U.S. college............... A2 Latest fund fashion: cash.... C1
U.S. NEWS
Beijing’s Intervention Is Worsening Market Turbulence
T
he convulsions in ter a series of ad hoc mea- resurrected a pledge to man- stimulate demand more
China’s stock and cur- sures taken to halt the stock The Gravitational Pull of Market Forces age the currency against a broadly and ease the transi-
rency markets this past bubble’s collapse last sum- Investors have responded to slowing growth in China by driving basket of currencies rather tion for laid-off workers into
week fanned investors’ worst mer, China’s securities regu- down both its shares and its currency, prompting periodic than just the dollar, which new jobs. People’s Daily On-
fears: The world’s second big- lator proposed circuit break- intervention by the government. appeared to be the justifica- line, a party mouthpiece,
gest economy is in trouble ers that would halt trading tion for engineering another quoted an “insider” as saying
and the authorities are pow- for 15 minutes if the main Chinese devaluation in the past week. that “turbulence cannot be
erless to fix it. stock index rose or fell more yuan vs. the entirely avoided, but it is
Friday
U.S. dollar 6.3 yuan
D
The truth is less frighten- than 5%, and for the day if it 6.5934 eteriorating funda- worthwhile turbulence.”
ing, but still moved more than 7%. mentals, not just spec- Such rhetoric isn’t new. A
THE fraught. China is “It was a sincere attempt ulation, are weighing year after becoming Commu-
6.5
OUTLOOK trying to shift on the part of regulators to on stocks and the currency. nist Party chief in 2012, Xi
GREG IP economic growth have a mechanism to prevent Scale is inverted to show The slowdown has been led Jinping pledged to give mar-
AND BOB to a slower, safer panic,” said David Dollar, a a weakening yuan by heavy industry and real kets a “decisive” role. But re-
6.7
DAVIS path, one less China expert at the Brookings 2015 estate, which are plagued by ality has been different. An
dependent on Institution. excess capacity and unsold overhaul of state-owned en-
capital spending But the collar was far too Shanghai property, in part the conse- terprises unveiled in Septem-
and debt. Chinese techno- narrow, perhaps reflecting an Composite quence of stimulus ordered ber suggested bureaucrats
Index 4,500
crats know that means open- aversion to the market’s in- Friday up by the government that would seek to merge compa-
ing to ever more market herent volatility. Shortly after 3186.41 helped repel the recession. nies suffering from excess ca-
forces, but its ruling elite is the circuit breakers took ef- 3,500 Economists at UBS esti- pacity, rather than let such
still not willing to accept that fect last week, they were mate that if China’s growth companies fail.
loss of control. triggered as downbeat news slumped to 4% this year (ver- This may be less disrup-
China’s economy is now and a falling yuan spurred 2,500 sus their forecast 6.2%), it tive economically and politi-
open enough that the Com- selling. Investors rushed to 2015 would slice half a point off cally in the short run because
munist Party can’t simply sell more. That made it a Source: WSJ Market Data Group THE WALL STREET JOURNAL. U.S. growth, 0.8 point off Eu- it would avoid loan defaults
state its preferred outcome foregone conclusion the cir- rope’s and 2.6 points off and minimize job cuts. But
and expect it to happen. In- cuit breakers would be trig- When the economy began accelerated and the yuan’s Japan’s. This is why global Haibin Zhu of J.P. Morgan
vestors inside and outside gered again. The halts to slow last year and the Peo- value in offshore markets fell stock and commodity prices notes that means debt will
the country have a say, too. sparked anxiety that spilled ple’s Bank of China cut inter- sharply below its more con- have been so sensitive to Chi- keeping mounting, productiv-
The result: As growth slows, over to other countries. est rates, investors naturally trolled onshore value. nese developments. ity and growth will slide fur-
its leaders repeatedly try to A similar tension afflicts sought to take capital out of The PBOC resisted those At their Central Economic ther, and rolling over loans to
tame the accompanying mar- currency policy. China has the country. The PBOC re- pressures, intervening heavily Work Conference in Decem- “zombie companies will
ket turbulence, often making long strictly controlled flows sponded by devaluing the to buy up yuan. It also inter- ber, party leaders recognized crowd out the financing for
matters worse. Whether that of capital across its borders, yuan last August. vened in the offshore yuan some slowdown was inevita- other companies (especially
interventionist instinct ulti- which helped it keep the China’s political leaders, market to beat back selling ble when they prioritized re- from new sectors).”
mately derails the economy’s yuan closely pegged to the to whom the PBOC reports, pressure, while other officials ducing excess capacity. That In the long run, then, it
transformation is very much dollar. But to make the yuan had a more expedient motive: ordered banks to crack down conference also suggested might be better for China,
an open question. a more widely held global re- bolster exports and growth. on currency speculators. that monetary and fiscal pol- and the world, that it suffer
This past week’s plunge serve currency, it has gradu- As investors expected more Then, as the dollar icy would be used not to prop the turbulence of market
exemplifies the challenge. Af- ally relaxed those controls. of the same, capital outflows marched higher, the PBOC up obsolete industries, but to forces now.
on Friday said Mr. Archer told from him,” said Mr. King, 32 tenured position hangs in the
detectives he was inspired by years old. balance.
the extremist group Islamic Defense attorney Doug Dolf- Professor Larycia Haw-
State when he opened fire on man, who briefly represented kins, placed on administrative
33-year-old Officer Jesse Hart- Mr. Archer in a 2012 assault leave and awaiting a hearing
nett’s marked cruiser at a case in Philadelphia, said he before nine faculty members at
West Philadelphia intersec- doubted Mr. Archer’s alleged Wheaton College in suburban
tion. Commissioner Richard claim that Islamic State in- Chicago, told reporters last
Ross said police didn’t know if Law enforcement officials outside the home of Edward Archer in Yeadon, Pa., on Friday. Mr. Archer spired last week’s attack. week she “is flummoxed and
Mr. Archer has any connection is accused of opening fire on a Philadelphia police officer on Thursday. “He’s just somebody who flabbergasted” by the school’s
to the group or acted on his was a lone wolf who just response but won’t cower “in
own. what motive he might have tempted murder, aggravated at a Philadelphia jail, Mon- wanted to make a name for fear of the enemy of the
The FBI is continuing to in- had,” FBI Special Agent Eric assault on a police officer, day’s planned sentencing of himself because he knew he month” as defined by “funda-
vestigate whether trips Mr. Ruona said in an interview. gun-related offenses and re- Mr. Archer in an unrelated had a case coming up,” Mr. mentalists of every stripe.”
Archer made to Saudi Arabia “I don’t want to be prema- lated charges. A preliminary case in neighboring Delaware Dolfman said, referring to his Ms. Hawkins, a 43-year-old
and Egypt in recent years ture and say there aren’t any hearing is set for Jan. 25. County, Pa., will be postponed, sentencing date in Delaware associate professor of political
have any connection to Thurs- connections, because it just Court records show Mr. Ar- officials there said. County. science, announced on Face-
day’s attack on Mr. Hartnett, takes time to figure that out,” cher is represented by the De- In November, Mr. Archer Mr. Dolfman recalled Mr. book she was donning the hi-
who is recovering from his in- said Mr. Ruona. He said Mr. fenders Association of Phila- was convicted of forgery and Archer as a “very flamboyant, jab during the pre-Christmas
juries. Archer, 30 years old, spent a delphia, which provides legal other charges stemming from loud, boisterous character, a season of Advent. She said her
“At this stage it’s still too couple of weeks in Saudi Ara- services to indigent criminal a minor hit-and-run incident little bit paranoid.” aim was to show support for
early for us to make any de- bia in October and November defendants. No one from the in 2014. In the 2012 case, Mr. Archer Muslims amid a rise in anti-
termination on whether or not 2011, and several months in association could be reached A conflicting picture of Mr. pleaded guilty to simple as- Islamic sentiment after the
[Mr. Archer] was involved Egypt during 2012. on Sunday. Archer emerged in recent sault and carrying an unli- terrorist attacks in Paris and
with any terrorist groups, or Mr. Archer is accused of at- With Mr. Archer being held days. censed gun. San Bernardino, Calif.
School officials said they
had no problem with the hijab
CORRECTIONS
AMPLIFICATIONS
Readers can alert The Wall Street
FED ing it publicly with greater fre-
quency. Shortly after the mid-
November global agreement,
Daniel Tarullo, the Fed’s regula-
can cause volatile price swings
during stressful periods. Margin
requirements could exacerbate
that problem if they make it
man Alan Greenspan spear-
headed a deregulatory push at
the central bank and other fi-
nancial authorities.
or her support for Muslims,
but took offense at comments
in her Facebook post in which
she said Muslims and Chris-
Journal to any errors in news Continued from Page One tory czar, gave a speech stating even harder for banks to partici- Now, Fed officials and others tians worship the same God.
articles by emailing stock purchases, the new rules the Fed will be developing the pate in the market. say modernized margin require- That conflicts with the school’s
wsjcontact@wsj.com or by calling
888-410-2667. being crafted by the central rules and touting them as “a “These rules may improve ments are one of the few tools statement of faith, which holds
bank would apply to securities- mechanism for limiting the the markets’ security, but they available to curb some of the de- that God consists of the father,
financing transactions, a mul- buildup of leverage in the finan- may well undermine their li- stabilizing excesses exposed the son and the Holy Spirit.
THE WALL STREET JOURNAL titrillion dollar market involving cial system” as memories of the quidity because you have fewer during the 2008 financial col- Muslims don’t believe in the
(USPS 664-880) repurchase agreements, or re- rough times fade. players” in a time of stress, she lapse. Trinity.
(Eastern Edition ISSN 0099-9660) pos, for stocks and bonds, as Unlike most of the central said. Democratic presidential “As they participate in vari-
(Central Edition ISSN 1092-0935) well as lending of securities. bank’s regulatory authority, this The Fed’s return to margin front-runner Hillary Clinton has ous causes, it is essential that
(Western Edition ISSN 0193-2241)
Editorial and publication
Wall Street firms of all rule would reach beyond banks requirements is symbolically said she would seek to impose faculty and staff engage in and
headquarters: stripes use the transactions as a and across the entire financial significant, a kind of throwback margin requirements globally to speak about public issues in
1211 Avenue of the Americas, source of short–term leverage, system, affecting investment to an earlier era of empowering limit borrowing outside the ways that faithfully repre-
New York, N.Y. 10036 borrowing that allows them to funds and other nonbank play- regulators to try to steer mar- banking system. sent the college’s evangelical
Published daily except Sundays and make more bets and boost re- ers, reflecting the Fed’s growing kets. Until 1974, the Fed regu- Fed officials have suggested Statement of Faith,” the school
general legal holidays. Periodicals turns on winning trades. But concern about what has been larly tinkered with the amount the task of crafting new margin said in a statement.
postage paid at New York, N.Y., and such leverage also amplifies called shadow banking. rules has taken on more urgency The debate is roiling the
other mailing offices.
losses on losing bets, and these And unlike most of the Fed’s as other new regulations ad- college as students return
POSTMASTER: Send address changes to
transactions were at the heart of recently expanded powers, this
The new margin opted to force large banks to Monday to the campus in
The Wall Street Journal, 200 Burnett Rd.,
Chicopee, MA 01020. the collapse of Lehman Brothers one doesn’t come from the 2010 requirements let the rely less on short-term funding Wheaton, Ill., 20 miles west of
All Advertising published in The Wall Holdings Inc., igniting the finan- Dodd-Frank financial-overhaul bite with more severity. This in- Chicago, after a holiday break.
Street Journal is subject to the cial crisis. act responding to the financial
Fed exert influence creases the potential for regula- “It’s extremely divisive
applicable rate card, copies of which The U.S. Office of Financial crisis but goes back to the 1934 on all financial firms. tory arbitrage, in which risky fi- right now,” said Kirkland An,
are available from the Advertising Research recently estimated the Securities Exchange Act enacted nancial activity moves outside editor of the student paper.
Services Department, Dow Jones & Co.
Inc., 1155 Avenue of the Americas,
securities-financing transaction after the Great Depression, banks and outside the Fed’s Alicia Artis, a senior,
New York, N.Y. 10036. The Journal market is worth about $4.4 tril- when policy makers blamed a of margin, or collateral, required reach. said she is organizing a stu-
reserves the right not to accept an lion, less than the crisis peak but debt-fueled stock frenzy for ex- by an investor to purchase “Understanding that eventu- dent sit-in at the college presi-
advertiser’s order. Only publication of still substantial. acerbating the 1929 Great Crash. stocks, raising or lowering the ally this is going to drive that dent’s office on Monday to ex-
an advertisement shall constitute final The new rules would exempt Fed officials will also have to figure when officials considered business outside of the regu- press displeasure with what
acceptance of the advertiser’s order. Treasurys and U.S. agency secu- consider how new margin re- American stocks overly, or insuf- lated realm, you want to have a she sees as an excessive reac-
Letters to the Editor:
rities, which concern the Fed quirements interact with other ficiently, pumped up with credit. tool that is less easily arbi- tion to Ms. Hawkins’s per-
Fax: 212-416-2891; email:
wsj.ltrs@wsj.com less because they are less risky rules, such as liquidity require- By the 1980s, policy makers traged,” said Jeremy Stein, a ceived transgression. “Main-
than other forms of collateral. ments that limit banks’ activities considered such powers obso- Harvard professor who worked stream Christianity doesn’t
NEED ASSISTANCE WITH Transactions using U.S. govern- in securities-financing markets lete, as increasingly sophisti- on financial regulation issues as like to say we have anything in
YOUR SUBSCRIPTION? ment securities likely make up by penalizing them for taking on cated investors found ways a Fed governor from 2012 to common with Islam,” she said.
CONTACT CUSTOMER SUPPORT. more than two-thirds of the se- too much short-term credit. around the requirements, and 2014. Luke Nelessen, a sopho-
By web: customercenter.wsj.com curities-financing market, ac- Karen Petrou, managing part- Washington had come to em- “The more stringent regula- more, said he wished Ms.
By email: wsjsupport@wsj.com cording to the OFR. ner of the policy-analysis firm brace a greater deference to tion of the banking sector may Hawkins had expressed sup-
By phone: 1-800-JOURNAL The Fed declined to discuss Federal Financial Analytics Inc., Wall Street. They didn’t alter push short-term financing activ- port for Muslims without say-
(1-800-568-7625) the rule’s timing, but officials said those rules already mean margin requirements in the late ities to less regulated entities,” ing they worshiped the same
Or by live chat at wsj.com/
livechat have signaled it is moving to- fewer buyers and sellers in the 1990s, even as the tech-stock Fed Vice Chairman Stanley Fis- God. “She crossed a line that’s
ward the front burner, discuss- market on a given day, which bubble grew, as then Fed Chair- cher said in a Dec. 3 speech. important,” Mr. Nelessen said.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. Monday, January 11, 2016 | A3
U.S. NEWS
For TV Stations,
2016 Ads Are Adds
Typically flush season The growing number of ad-
New Channels vertising platforms saves the
is now even more so As TV stations move regular stations’ salespeople some
as regular customers advertisers to digital channels, headaches, too. Rachel Schmit,
more campaigns are following an account executive at KCRG,
buy spots online the same route. has at times baked her cus-
tomers what she calls “pre-
BY REBECCA BALLHAUS Total spending on political emption cookies” when their
advertising spots have been bumped by
CEDAR RAPIDS, Iowa—For Broadcast TV Cable Digital political ads. Now, “we have a
decades, presidential cam- lot more things to offer digi-
$6 billion $5.83 billion
HILLARY FOR AMERICA
last at KCRG in Cedar Rapids, web.” He said he is paying TV advertising, predicts over-
the top-ranked station in the nearly the same amount to the all spending for the 2016 elec-
second-largest media market station, KCCI, as he usually tions will be about $4.4 billion,
in Iowa, according to national does, and he is happy with the up roughly 16% from what can-
sales manager Steve Lake. results. didates and outside groups
Larger Des Moines stations are Nick Pagliai, manager of Pa- spent on cable and broadcast
expecting an overall revenue gliai’s Pizza in Johnston, Iowa, ads in the 2012 cycle.
increase of as much as 25% said he has worked with his lo- Not all TV stations have
from last year after political cal station to divert some of been able to bypass the crowd-
spending is combined with his ad spending to digital. He ing-out effect of political ads.
their local advertisers, many of recalls the station’s ad sales- Ken French, the advertising
whose messages are now run- man telling him of political ad and events manager at a car
ning online. season: “This is coming. This is dealership in Charleston, S.C.,
Beyond the creative use of how I see you surviving.” said he has grown frustrated
the web, prices are going up. By maintaining their regular with his inability to get his ads
KCRG has already booked ads customers, on top of the influx on TV, with rates up 25% in the
for more than 25 campaigns of cash from super PACs back- lead-up to February’s primary.
and political groups. The in- ing more than a dozen candi- “I know [TV stations] want
creased need for the station’s dates in the race, TV stations to take the money from the su-
airtime means advertisers—in- are in for an even bigger wind- per PACs and sell that time,”
cluding those not involved in fall than usual this cycle. In he said. “But come the second
politics—have to pay more for November, the Tribune Televi- week in February, that money
the guarantee that their ad will sion Group, which has 42 sta- is gone for another four years,
run. The election has so far tions in 33 markets, projected and I’m still going to be here.”
driven rates up 25% for nonpo- net revenue for 2015 of about He said he would explore
litical advertisers targeting $2 billion. Its digital ad reve- other advertising options.
high-demand programs, Mr. nue for the first three quarters Some advertisers avoid the
Lake said. of the year was up 26% over political season. Toby Joseph,
Attorney Jeff Wright said he the comparable period in 2014. whose family runs the Josephs
got “hammered” in the 2014 For stations, digital ads Jewelers chain in central Iowa,
election. His Des Moines firm, aren’t a replacement for isn’t planning to air ads until
TED CRUZ FOR PRESIDENT
Carr & Wright, typically runs broadcast ones, as they bring after the Feb. 1 Iowa caucus.
as much as $4,000 in TV ads a in less money and reach a While Mr. Joseph says he is
month, but nearly none of its smaller audience. Still, most tired of fielding four calls a
spots wound up on air in the stations recommend mixing night from various campaigns,
lead-up to the midterm elec- both TV and digital ads even in there is a silver lining: “I love
tion. “All of a sudden, the the nonpolitical season, be- wealthy people in my city,” he
From top, still images taken from campaign ads by presidential candidates Hillary Clinton, Donald phone stops ringing,” he said. cause online ads allow a more said. “I hope everyone at the
Trump and Sen. Ted Cruz. Such ads typically crowd out other advertisers during the election season. This season, Mr. Wright targeted approach. TV station makes a fortune.”
CAMPAIGN
network didn’t come up in the
Democratic group.
BY BETH REINHARD Bush was governor.
In a sign that Mr. Bush may
a long time ago, but for Jeb I’d
do just about anything,” said
the alumni group walked away
with a Bush convert. WIRE Both groups said they use
Google to search for candidates
NORTH CHARLESTON, S.C.— be running low on money, his 64-year-old Ed Moore, president Retiree Rachel Carter was HHHHH and issues, and were wary of in-
Since Jeb Bush signaled a likely campaign recently said it was of the Independent Colleges and walking her longhair chihuahua formation their friends posted
presidential bid one year ago, canceling $3 million of televi- Universities of Florida. near her North Charleston home online on networks such as
his family’s decades-old net- sion time in Iowa and South “Once you are connected to when she ran into Stephanie Ko- IMMIGRATION Facebook because it may not be
work of former ambassadors, Carolina. The campaign also has the Bush family, you are forever pelousos, who worked as Mr. truthful. (Google was one of the
cabinet secretaries and Wall pulled several hundred thou- dedicated, and they maintain Bush’s federal liaison in Wash-
Cruz Slams Trump’s sponsors of the focus group, but
Street financiers has been doing sand dollars in ads in New the relationships,” said Frances ington, D.C., and later as secre- Deportation Stance the participants in the focus
what it does best: raising Hampshire, according to people Fisher, who worked in the first tary of the Florida Department Texas Sen. Ted Cruz said he group weren’t made aware of
money. familiar with the transactions. Bush White House and recently of Transportation. doesn’t support sending forces that.)
But now, with Mr. Bush lag- That means his candidacy’s hosted a fundraiser for Jeb “My reservation is that Bush to round up and deport illegal Mr. Luntz showed the focus
ging behind in the final stretch success increasingly hinges on Bush in her Palm Beach home has got too soft of a personal- immigrants, likening such a pol- groups printed images of the
before Republican votes are the mechanics of targeting po- that was attended by former ity,” said Ms. Carter, who said icy to “a police state.” candidates’ websites. Over-
cast, hundreds of supporters tential supporters and mobiliz- first lady Laura Bush, wife of ex- she was thinking of voting for “I don’t intend to send jack- whelmingly, the 24 people in the
from his Florida governorship ing them to vote. President George W. Bush. Mr. Trump. Of Mr. Bush, she boots to knock on your door and Democratic group picked Sen.
and two family White Houses The campaign calls the Bush Still, canvassing neighbor- added, “I think he needs to be a every door in America; that’s not Bernie Sanders’s website as
are trading their checkbooks for alumni “validators” because, hoods is tiring. More people are little sharper.” how we enforce the law for any their favorite.
comfortable shoes to canvass having known or worked with out and about than indoors. Ms. Kopelousos talked about crime,” Mr. Cruz said on CNN. —Natalie Andrews
neighborhoods in the early-bal- the ex-governor, they can vouch Dogs bark. Homeowners slam Mr. Bush’s handling of eight Donald Trump has called for a
loting states of Iowa, New for him in a way that a volun- the door. hurricanes that hit his state “deportation force” to remove STATE OF THE UNION
Hampshire and South Carolina. teering College Republican One resident in Hanahan, over less than two years. She the roughly 11 million immi-
Their hope is that a strong can’t. Supporters say they see in S.C., seemed taken aback when wrote her cellphone number on grants in the country illegally.
Aide: Speech to Rebut
voter-turnout operation—en- Mr. Bush not the slightly three Cuban-Americans from a campaign flier. And she never The Texas senator spoke up ‘Doom and Gloom’
hanced by front-stoop contact stooped presidential candidate Miami knocked on his door. stopped stroking the Chihuahua. for the employment-verification President Barack Obama
with people who personally ridiculed by Donald Trump as “I’m very sympathetic to eth- Finally, Ms. Carter was con- program E-Verify and the crimi- plans to offer an upbeat look at
know Mr. Bush—will boost him “low-energy” but a two-term nic people because I’m ethnic vinced. “Can you give me some- nal law-enforcement system to America’s potential in his final
to a better-than-expected show- governor who pushed a conser- myself. I’m French Canadian,” thing to put in my yard?” A combat illegal immigration. State of the Union address
ing in the February contests. vative agenda of tax cuts, gun said the man, who declined to campaign placard was retrieved, “Federal immigration law says Tuesday night, Chief of Staff
This past weekend, more rights and charter schools. give his name. while Ms. Kopelousos went to if we apprehend an individual Denis McDonough said Sunday,
than 50 Bush alumni, mostly “I gave up knocking on doors Every so often, a member of go knock on another door. who is here illegally, they are to moving to draw a contrast with
from Florida and Washington, be deported. I will enforce the what he called the “doom and
D.C., paid their own way to law,” Mr. Cruz told CNN. gloom” of Republican presiden-
knock on doors in South Caro- —Harriet Torry tial contenders.
lina, where Mr. Bush is polling Mr. McDonough said Mr.
in fifth place with 8.5%, accord- IOWA CAUCUSES Obama will break from tradition
ing to Real Clear Politics. by eschewing the recitation of
The group included longtime
Voters Say They Go specific, year-ahead policy wish-
Republican operatives who Online for Information lists and instead offering a
worked for Mr. Bush’s father, With just weeks to go before broad and optimistic look at the
former President George H.W. deciding on a candidate, Iowa country’s potential over the com-
Bush, as well as the network of voters are still sorting through ing decades.
Hispanic professionals culti- candidates—and critiquing their ”The president is going to lay
vated by Mr. Bush’s two sons, Web and social-media efforts. out…a picture of the country
George P. and Jeb Bush Jr. Many In two weekend focus groups moving forward, focused on the
BETH REINHARD/THE WALL STREET JOURNAL
are more accustomed to hosting in Des Moines, one for Demo- future—not afraid of it,” Mr. Mc-
receptions and consulting on crats and one for Republicans, Donough said on Fox.
policy than the grind of cam- GOP pollster Frank Luntz found Mr. Obama told his staff late
paign volunteer work. that the Web wins, hands down, last year that he didn’t “want
“For someone who has never when voters look for information this to be your traditional policy
done it before, it’s a little intim- on the races. speech that outlines a series of
idating and uncomfortable to But this being Iowa, a major- proposals,” Mr. McDonough said
knock on the door of a perfect ity of Democrats and Republi- on ABC.
stranger,” said Simone cans raised their hand when The speech will hit on three
Marstiller, an assistant general asked if they had met a candi- broad themes, he said: the econ-
counsel and secretary of the De- date in person. omy, national security and civic
partment of Business and Pro- Stephanie Kopelousos, center, and former U.S. congressman Tom Feeney tried to persuade retiree Iowa Republicans said they participation.
fessional Regulation when Mr. Rachel Carter, left, to vote for Jeb Bush over the weekend in South Carolina. have an eye on the Twitter ac- —Nick Timiraos
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THE WALL STREET JOURNAL. Monday, January 11, 2016 | A7
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A8 | Monday, January 11, 2016 * * THE WALL STREET JOURNAL.
WORLD NEWS
Kurds Hold Out in Battle With Turkey
In urban stronghold, Kurdish-inhabited areas GEORGIA
barricades and booby Sites of Turkey's main military
operations against Kurdish insurgents
traps help rebels stall ARMENIA
AZER.
U.S.LaudsIraqis
ForRamadiGains
BY GORDON LUBOLD and the capabilities of the
Peshmerga, as those Kurdish
BAGHDAD—U.S. military of- forces put pressure on Islamic
ficials have expressed quali- State from the north, the fight
fied optimism about Iraqi against the militant group has
forces’ accomplishments become multipronged, U.S. of-
against Islamic State in the ficials add.
western city of Ramadi, dem- “What you’re ultimately
onstrating a determination now looking at is Daesh is be-
some American officers said ing hit on many fronts, and is
they haven’t seen in months. not simply capable of dealing
SASCHA SCHUERMANN/GETTY IMAGES
cials who believe the Ramadi the public mood without sub- saults were reported on a the attackers were the ones re- open-door migrant policy.
battle underscores the grow- stantially changing course. smaller scale in the cities of sponsible in cases of sexual vi- “I was always in favor and
ing capabilities of Iraqi forces. She used tough language af- Hamburg and Stuttgart. olence. now I’m wondering whether
The battle plan for Ramadi, ter a meeting of senior party Authorities, who have de- While 19 people had been what I thought was right,” she
which Iraqis showed Gen. Dun- officials on Saturday, pledging scribed the violence in Cologne identified as possible suspects, said, standing on the train sta-
ford when he last visited here to more aggressively deport as unprecedented in the coun- the police continued to analyze tion square where the New
in October before the Iraqis migrants convicted of crimes. try, have also said that most video footage and witness Year’s Eve assaults were al-
attempted to retake the inside But she gave no indication that potential suspects had applied statements to determine leged to have occurred. “I
of the city, was much the way she would back away from her for asylum in Germany or were whether those people could be think every woman is afraid to
the battle actually played out. refusal to cap the number of in the country illegally. Co- tied to specific crimes. In addi- walk around here.”
Gen. Joe Dunford, right, with That reflected a new level of refugees Germany accepts or logne’s police chief was forced tion, a 19-year-old Moroccan —Monica Houston-Waesch
Turkish Premier Ahmet maturity in the Iraqi approach, from her insistence that Eu- out Friday amid criticism over man who was known to au- and Andrea Thomas
Davutoglu, in Ankara last week he said. rope come up with a joint solu- the police’s failure to prevent thorities since 2013 and had contributed to this article.
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To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL. Monday, January 11, 2016 | A9
WORLD NEWS
World
Watch
Egypt Convenes First Parliament in Four Years
BY TAMER EL-GHOBASHY ment has been characterized a document ratified in 2014 of the popular uprising that some newcomers who have de-
by Mr. Sisi as the final step in that gives the House of Repre- overthrew former President scribed the 2011 uprising as a
CAIRO—Egypt’s first parlia- a “road map to democracy” sentatives unprecedented Hosni Mubarak. catastrophe for Egypt and see
ment in nearly four years was that began when—as military powers to remove the presi- Members of the legislature Mr. Sisi as the only person who
sworn in on Sunday, with chief in 2013—he removed dent or prime minister. were elected during polls held can restore security and repair
YEMEN many prominent legislators Egypt’s first freely elected But the Egyptian Parlia- from October through to De- the floundering economy.
saying their priority is amend- president, the Muslim Brother- ment’s makeup reflects Mr. cember that were marked by Following the regional and
Deadly Strike Hits ing the constitution to further hood’s Mohammed Morsi. Sisi’s tightening grip on power lackluster voter turnout. local rise of Islamic State, Mr.
Hospital in North empower President Abdel Fat- A record 596 lawmakers as the Arab world’s most popu- The parliament reflects the Sisi has secured international
A projectile hit a Doctors tah Al Sisi. took individual oaths pledging lous country approaches a po- return of figures from Mr. support for his opposition to
Without Borders hospital in The convening of the parlia- to uphold Egypt’s constitution, tentially testy fifth anniversary Mubarak’s era, along with extremist groups.
northern Yemen on Sunday, kill-
ing at least four people and in-
juring 10, the medical-aid group
said, the latest in a string of
deadly incidents at its facilities
in the country.
Doctors Without Borders said
the hospital in Razeh, a district
in Yemen’s Saada province, was
hit at about 9:20 a.m. local time.
The explosion destroyed several
buildings in the complex, the
group said. It couldn’t confirm
the origin of the attack.
A Saudi-led military coalition
has been conducting airstrikes in
Yemen since March, aiming to
unseat Houthi rebels who are
backed politically by Iran, Saudi
Arabia’s regional rival. Saada
province is a Houthi stronghold.
Tamim al-Shami, a spokes-
man for the Houthi-run health
ministry, blamed a coalition
strike for the destruction of the
hospital. The Saudi-led coalition
couldn’t immediately be reached
for comment. —Asa Fitch
SPAIN
Separatist Elected
Leader of Catalonia
Separatist legislators in
Spain’s wealthy Catalonia region
elected a new president on Sun-
day, overcoming months of in-
fighting and ratcheting up pres-
sure on national leaders to set
aside their differences and form
a government to thwart the se-
cession bid.
The Catalan parliament
elected Carles Puigdemont, a 53-
year-old mayor and head of an
association of separatist munici-
pal leaders, as regional president.
He has said he is committed to
making Catalonia an indepen-
dent nation within 18 months.
His unexpected ascent came
through an 11th-hour deal on
Saturday between the main pro-
independence ticket and a small
far-left separatist party that
stubbornly objected to the re-
election of incumbent Artur Mas.
Had no president been elected
by midnight Sunday, Catalonia
would have been required to
hold new regional elections.
—Matt Moffett
AFGHANISTAN
Delegates to Try to
Revive Peace Talks
Delegates from Afghanistan,
Pakistan, the U.S. and China are
set to meet Monday in an effort
to revive collapsed Afghan peace
talks and bring an end to the
government’s long-running war
with the Taliban.
The U.S. in recent months
has been pushing the Afghan
and Pakistani governments to
renew efforts to restart the
peace process, which broke
down in July amid disagree-
ments on who would assume
the leadership of the Taliban.
At the top of the agenda for
Monday’s talks in Islamabad is a
proposal from the Afghan gov-
ernment in Kabul to identify in-
fluential Taliban representatives
who could be approached for
talks and commit to fighting
others, said Afghan and Pakistan
officials attending the one-day
meeting. Taliban representatives,
who have declined to comment
on the meeting, weren’t ex-
pected to attend.
—Jessica Donati
SAUDI ARABIA
Arab League Offers
Support in Iran Spat
The Arab League backed
Saudi Arabia in its diplomatic
spat with Iran, triggered by the
kingdom’s execution of a dissi-
dent Shiite cleric, condemning
Tehran for failing to protect
Saudi diplomatic sites in the
Persian country.
“The Arab League won’t ac-
cept Iranian intervention in the
Arab region and sowing sectar-
ian strife,” Secretary-General
Nabil al-Araby said in a televised
news conference at the league’s
Cairo headquarters after an
emergency session that Riyadh
requested.
All member states supported
the statement except Lebanon,
which has a large Shiite popula-
tion and strong political ties
with Tehran.
Sunni Saudi Arabia and Shiite
Iran are vying for more influence
across the Mideast, mostly along
sectarian lines.
—Tamer El-Ghobashy
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A10 | Monday, January 11, 2016 * * THE WALL STREET JOURNAL.
WORLD NEWS
A
ready hammered out. ny political instability those campaigning for Brexit bind the eurozone closer to- Penn and Kate del Castillo, a Trump, letting the Republican
Bookmakers put the arising from a rupture are unable even to agree gether, including completing Mexican actress famous for presidential candidate know
chance of Britons voting to within the Conserva- among themselves what kind its banking union and devel- playing a drug boss, helped there was one more American
leave the EU at 36%. That is tive party would likely be of future trading arrange- oping new mechanisms to lead security forces to the who doesn’t support him.
roughly the same probability compounded by wider insta- ment the U.K. should de- help the currency bloc re- drug lord. Mexican government offi-
implicitly assumed by institu- bility within the U.K. A Br- mand, let alone what kind of spond to economic shocks. Mexican officials said they cials said the two actors are
tional investors, according to exit vote would raise doubts arrangement the EU might located Mr. Guzman’s hideout under investigation, although
I
a survey by Absolute Strat- about the long-term viability be willing to concede. nevitably, a Brexit would in part by tracking the interac- the officials declined to give
egy Research. There may be of the political union among What is clear is that an raise questions about tions between the actors and more details of the probe. Ana-
powerful reasons to believe England, Scotland, Wales EU-lite arrangement similar whether other non-euro- Mr. Guzman’s lawyers. lysts say it is unlikely Mr. Penn
that Britons will ultimately and Northern Ireland. It to those currently enjoyed zone countries would follow The drug lord was recap- or Ms. del Castillo would be
vote to remain, particularly would be bound to trigger by Norway and Switzerland the U.K., sapping the EU of tured on Friday. The Mexican charged with any crime. Mara
when urged to do so by Mr. demands for a fresh vote on is out of the question, and the cohesion it needs to ad- government on Saturday said Buxbaum, a spokeswoman for
Cameron. But the possibility Scottish independence. Mr. Cameron has already ex- dress other common chal- it had restarted proceedings to Mr. Penn, and Ms. del Castillo’s
of a “Brexit” can hardly be A Brexit vote also risks plicitly ruled them out. Such lenges including the migra- extradite Mr. Guzmán to the spokesman declined comment.
dismissed as a minor risk. In- profoundly destabilizing the an arrangement would re- tion crisis, deepening of the U.S., where he faces charges “The main question to ask
vestors should prepare them- peace process in Northern quire the U.K. to continue to single market, and relations that include drug trafficking, is: Did this person do anything
selves for the consequences. Ireland. The Irish government accept the right of EU citi- with Russia, leaving the con- homicide and money launder- that’s in furtherance of the
Of course, the greatest im- has repeatedly argued that EU zens to live and work in the tinent more vulnerable to ing in multiple federal jurisdic- criminal activity?” said Dan
pact would be on the United membership has played a sig- U.K., the very issue that is economic shocks. tions. That process is likely to Suleiman, an attorney at Cov-
Kingdom itself. This would be nificant role in bringing peace most likely to have swung That could undermine take months. ington & Burling LLP in Wash-
felt via three main channels. to the province, providing a voters against continued corporate confidence just as Mr. Guzmán has long been ington, D.C.
The first is the risk of serious neutral space where the two membership. the eurozone urgently needs the stuff of legend in Mexico, U.S. law states that the ac-
political instability. Although sides could meet as equals. Many economists agree increased business invest- particularly after slipping out tor couldn’t be charged as be-
Mr. Cameron would likely to The prospect of establishing a that the combined impact of ment to help broaden a re- of a maximum-security prison ing an accessory after the fact
try to stay on as prime minis- new external EU border—po- this uncertainty is bound to covery currently overreliant in 2001 by hiding in a laundry unless he assisted Mr. Guzmán
ter even if defeated in the ref- tentially introducing new re- damage confidence and in- on consumer spending. A Br- cart and eluding capture for 13 “in order to hinder or prevent
erendum—he said as much in strictions on the freedom of vestment, damaging growth exit-induced resurgence in years, becoming the world’s his apprehension,” said former
a TV interview Sunday—it is movement of goods and peo- and weakening sterling. But the euro crisis would have most successful narcotics traf- federal prosecutor Jimmy Gu-
unlikely he could cling on for ple—along one of the most the economic consequences global consequences. That ficker along the way. But his rulé, now a law professor at
long. Those who had cam- volatile political fault lines in of a Brexit would be felt well much is a known known. second escape last July earned the University of Notre Dame.
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A12 | Monday, January 11, 2016 THE WALL STREET JOURNAL.
me into it,” says Ms. Irwin, now by police when investigating that have yet to publicly ac- nience, and he believes they
22 years old. “She said, ‘What the cause of an accident. Pro- knowledge at least experiment- will continue to do so even as
can it hurt if it saves you gressive said it has received ing with usage-based insurance they complain.
money?’ ” Within a month, her subpoenas in “a small number is Berkshire Hathaway’s Geico “Privacy already has shifted
Vanessa Irwin uses Progressive’s Snapshot program. She says rates were cut by 30% to about of instances,” declining to pro- unit, which has bigger market from being a right to a good
she recommends it, but that her friends have ‘privacy concerns.’ $165 a month. vide specifics. The data stays in share than Progressive. In the that is purchased,” he says.
OPINION
China Disappears Information BOOKSHELF | By Jeffrey Collins
Analysts
trying to
under-
Four bookstore employees
disappeared in October, three
while visiting the mainland and
mouthpiece Xinhua warned
that “malicious” short sellers
must be dealt with in a “firm-
investors are in the dark, and
China’s 90 million individual
shareholders even more so.
The Commercial
stand the
volatile
Chinese
one in Thailand. Last month
co-owner Lee Bo vanished. “I
am not worried,” he had told
handed manner.”
The bellwether was the
arrest of Wang Xiaolu, a
When mainland
blocked Web searches for
censors
I
gritty Philip Hammond last week ate. This week, I ate my dog.”
building on Lockhart Road in complained in Beijing about There is a connection In addition to booksellers n the summer of 1776, the celebrated diarist James
Hong Kong. They’ll find a re- the snatching of Mr. Lee, a and journalists, Beijing has ar- Boswell visited the Edinburgh home of David Hume,
minder of the risks of operat- British citizen, calling it an between Beijing’s rested numerous senior finan- where the philosopher lay dying. Hume, atypically thin
ing in an authoritarian country “egregious breach” of China’s repression and last cial executives. Among them and “ghastly” in pallor, was nevertheless “placid.”
where providing information commitment to respect Hong are senior bankers at the Citic Interrogated by Boswell, he affirmed his view that the
is a crime. Kong’s rule of law and freedom week’s market shocks. brokerage as well as the presi- afterlife was an “unreasonable fancy.” With “death before his
On the second floor is of speech. dent of the country’s first eyes,” Boswell reported, Hume blithely predicted his own
Causeway Bay Books, long a There’s a connection be- private bank, China Minsheng. annihilation. “I maintained my faith,” wrote Boswell, but “left
popular destination for main- tween Beijing’s repression and pull back on propping up the Some arrests relate to corrup- him with impressions which disturbed me for some time.”
land visitors looking for infor- last week’s collapse of its stock market. Mr. Wang was tion, but others are for no This scene often serves as a miniature representation of
mation banned at home. It’s stock market. International detained, then forced on reason but to control markets. Hume’s career. Boswell’s watery piety crashes against
closed, at least temporarily, af- investors have long trusted national television to confess In all, executives from 34 Enlightenment reason. Superstition flinches before
ter five owners and employees Hong Kong as a haven for that he had published “private companies have disappeared, knowledge. The sang-froid of Hume’s godlessness amazed
were “disappeared”—appar- information about China. The information” and brought with only some reappearing. contemporaries, and modern atheists have treasured the tale.
ently snatched and detained Communist Party has always “great losses to the nation and Among those was Guo James A. Harris’s “Hume:
by mainland security forces— censored political speech in investors.” Guangchang, chairman of the An Intellectual Biography”
for selling books that offend China, but until recently the Publishing private informa- Fosun Group, who is known as punctures most of this
Beijing. Politburo understood that tion about markets is central China’s Warren Buffett. His in- mythology. Though an atheist,
The case shows Beijing is being part of global markets to financial journalism. Mr. terests include Cirque du Hume was nowhere near as
willing to create international requires an open flow of infor- Wang’s reporting about gov- Soleil, Club Med and the for- dogmatic as his current
incidents to control informa- mation. Beijing’s censorship ernment plans was accurate, mer Chase Manhattan Plaza in admirers. He was certainly not a
tion. Just before the store now suppresses economics as which was no defense. In- downtown Manhattan. Brokers rationalist. His reputation for
closed, its two best sellers well as politics. stead, Beijing used his case to and hedge-fund managers are philosophical intrepidity, fur-
were “2016: Collapse of the Chinese share prices have instruct other journalists it is also among the mysteriously thermore, has been overblown.
Communist Party of China” fallen 40% since summer. Bei- now a crime to report accu- missing. David Hume was born in 1711
and “Shen Bing’s Account: My jing is eager to stop the decline, rate information about mar- Global finance depends on a in Scotland, the third child of a
Story With Zhou Yongkang,” in with the government buying kets. The Chinese propaganda free flow of information. gentrified lawyer. He would spend
which the author, a state-TV shares directly as well as ministry issued a directive: “Do World markets are in un- much of his life at the family’s
anchorwoman, describes her through pensions and pressur- not use emotionally charged charted territory now that the country home, Ninewells. As a
affair with Mr. Zhou, a former ing patriotic brokers. It bans words such as ‘slump,’ ‘spike’ world’s second-largest econ- younger son, Hume required an occupa-
Politburo member now impris- large owners of a stock from or ‘collapse,’ ” it instructed. omy is censoring within and tion. He flirted with law and business and enjoyed some mi-
oned for corruption. There’s selling more than 1% of total “Do not conduct in-depth beyond its borders. The lesson nor government jobbery. But he always wished, Mr. Harris
speculation that the disap- shares at once and requires analysis, and do not speculate from China is that markets writes, “to live the life of a man of letters.” This aspiration
pearances are meant to stop a them to inform exchanges on or assess the direction of can’t function smoothly when was just becoming possible as an expanding commercial
planned book about the love three weeks in advance to sell the market.” accurate information is disap- print market replaced a reliance on aristocratic patronage.
life of President Xi Jinping. shares at all. The official The result is that global peared. Writing would eventually make Hume rich and famous,
but for many years he lived a transitory, modest life. He was
often unhappy. For much of the early 1730s, Hume endured
North Korea’s Cuban Friends an emotional breakdown. During this time, and periodically
thereafter, he lived with his family—unable to establish him-
self in the world and crippled by depression (the “disease of
You’d think story that the State Depart- the State Department’s list of pledged its loyalty to North the learned,” as one of his doctors called it). His gloom
that North Ko- ment became aware in June state-sponsors of terrorism. Korea. In March 2015, accord- emerged from his reading and from the belief that the stric-
rean dictator 2014 that a Hellfire missile The missile is only the lat- ing to Cuba’s state-run news tures of traditional Christian and Stoic morality were an im-
Kim Jong Un had gone missing and that it est example of the no good agency, North Korea’s foreign possible burden to bear.
wouldn’t have was “likely in Cuba.” that Cuba is still up to. In July minister visited Havana and Mr. Harris’s book is, as advertised, an intellectual
a friend in the Let’s face it: That was no 2013 Panama Canal authori- reminded Cubans that the two biography. It will not supplant E.C. Mossner’s standard
AMERICAS world these shipping error, as some have ties discovered 240 metric peoples “share a history of biography of 1954. As a historian of Hume’s ideas, however,
days. His re- speculated. Stealing weapons tons of weapons—including struggle together in the same Mr. Harris far surpasses Mossner. Hume wrote prodigiously:
By Mary
lentless pur- technology is what spies do for jet fighters and missiles—hid- trench against U.S. imperial- on philosophy, economics, politics, religion and English
Anastasia
suit of weap- a living, and getting hold of a den under a sugar shipment ism, which continues exerting history. Mr. Harris extracts no “system” from this variety. He
O’Grady
ons of mass sophisticated piece of U.S. aboard a North Korean ship economic pressure on our proceeds chronologically, fixing each work amid surrounding
destruction equipment is a major coup for that had sailed from Cuba and countries to this day.” The texts and debates. Mr. Harris’s Hume exists not in the flesh
and willingness to starve his Havana. was bound for North Korea. news agency also reported but on the page, engaging fellow philosophers, such as Man-
own people is evil madness. It is not a stretch to think that the minister brought a deville, Montesquieu and Shaftesbury.
Last week even communist that the regime will share, for “message from Jong-Un in or-
China condemned the supreme a price, everything there is to The Castro boys now der to expand and strengthen”
leader’s fourth nuclear test, know about the laser-guided, the excellent relations between The Enlightenment is often miscast as the ‘Age
which the chubby little psy- air-to-surface Hellfire—which have a U.S. Hellfire the two countries. of Reason.’ In truth, it dethroned rational
chopath called “the thrilling can be launched from a heli- missile to share In June 2015 Raúl Castro
sound of our first hydrogen copter or drone as well as from hosted Kang Sok Su, the sec- philosophy in favor of sociology and psychology.
bomb explosion.” a plane—with its good friends with Kim Jong Un. retary of international rela-
But Mr. Kim is not all Iran, Russia and North Korea, tions for the North Korean
alone. He still has the Carib- and even with other terrorist Workers’ Party. In September There are costs to Mr. Harris’s erudite method. Hume’s
bean’s Cosa Nostra—aka the organizations. Havana tried to play down Mr. Kim received Cuban Vice friendship with Adam Smith, his Continental travels, his
Castro family—as a friend and President Obama seems to the incident, calling the weap- President Miguel Díaz-Canel notorious falling out with the paranoid Rousseau: None of
ally. The Cold War may be think that the Castros have ons outmoded. But the U.N.’s in Pyongyang. Cuba’s state- this is narrated in detail. Mr. Harris’s textual explications
long over, but Cuba is sticking abandoned their revolutionary North Korea sanctions com- owned newspaper Granma can have a dry, lofty air. But patient readers are rewarded.
by the North Korean pariah. obsession with harming the mittee said the shipment reported that Mr. Kim sent Hume emerges as a product of the Enlightenment as it really
This bond exposes Ameri- U.S. The theft of the Hellfire demonstrated “intent to evade “an affectionate greeting” to was, not as it exists in complacent legend.
cans to grave risk. Analysts would have disabused even UN sanctions” and that it was the Castro boys during the In his earliest and most substantial writings, Hume
fret that Pyongyang is devel- Chauncey Gardiner of such “consistent with previous visit. It also said that Messrs. adopted Locke’s empirical outlook—the idea that all knowl-
oping missiles and miniatur- naiveté. attempts by” Pyongyang “to Díaz-Canel and Kim discussed edge is derived from the senses—but drove its inherent
ized warheads that will allow But not Mr. Obama. He was transfer arms and related the two countries’ close rela- skepticism further than Locke had dared. Hume denied our
it to lob a bomb into the conti- already engaged in a rap- materiel through similar tac- tions and mutual cooperation. capacity to understand, even imperfectly, material causation,
nental U.S. But having a des- prochement with the regime tics in contravention of Secu- This ought to worry U.S. and he abandoned any notion of “final cause” (or purpose)
perate ideological pal 90 miles when the State Department rity Council prohibitions.” national-security officials. But in the created order. He also denied the temporal stability of
from U.S. shores magnifies the learned that Havana had the Samantha Power, the U.S. Mr. Obama is busy worrying our individual personalities. That a rock would invariably
danger. In the past 21/2 years missile. If he issued an ulti- ambassador to the U.N., called about shaping his legacy. I’m shatter glass, or that I am the same man I was last week,
Cuba has tried to smuggle matum that it be returned, his it a “cynical, outrageous and not sure why: He’s the first were mere imaginative tricks used to order the chaotic wel-
weapons to Pyongyang, en- talks might have collapsed. illegal attempt” by the two U.S. president to bow to a ter of sense. They were not demonstrably true.
gaged in high-level meetings So six months later he countries to evade U.N. sanc- Saudi king, the first to open In Hume’s view, vanity and comfort-seeking were the key
with North Korean officials, went ahead with his plan to tions. the door for Iran to get the components of our “mental anatomy,” and the operations of
and secured U.S. military throw a lifeline to the eco- In the 13 months since Mr. bomb, and the first to prop up sentiment propelled human society. This privileging of
technology. Anybody want to nomically struggling Castros Obama’s announcement that the Castros even while they mental disposition was typical of the era, as was Hume’s
connect the dots? by restoring diplomatic rela- he would reopen a U.S. em- hold a stolen Hellfire missile. fundamental utilitarianism. The Enlightenment is miscast in
On Friday Wall Street Jour- tions and liberalizing Ameri- bassy in Cuba and use execu- His place in history is already most textbooks as the “Age of Reason.” In truth, the
nal reporters Devlin Barrett can travel to the island. In tive decrees to weaken the U.S. secure. Enlightenment dethroned rational philosophy in favor of
and Gordon Lubold broke the May Cuba was removed from embargo, Cuba has repeatedly Write to O’Grady@wsj.com. sociology and psychology. Hume’s “Treatise of Human
Nature” and “Enquiry Concerning Human Understanding”
undermined not just religion but rationalism as well.
In Age of Google, Librarians Get Shelved In mid and later life, Hume wrote essays and narrative
histories of England, reaching a wide audience and achieving
the fame he had long sought. These works flattered and
By Steve Barker librarians no longer hold an closed their library schools ies can easily justify this new charmed, rather than challenged, his readers. They con-
T
MLS degree. Public libraries around the same time. It is position: Techies are paid less tained real insight, as Mr. Harris shows, but they also re-
he next time you visit a have created a new position still possible to get an MLS de- than librarians or library asso- flected the mannered dilettantism of their era.
public library and see an called “library associate”—col- gree, but the remaining gradu- ciates and they offer skills the Hume remains most famous for his irreligion. His essays
older person at the in- lege graduates who do the ate programs are much smaller public increasingly needs. The defending suicide and attacking miracles vexed the
formation desk, someone near same work as librarians but and are usually consolidated in public library of the future orthodox, and they loathed him in turn. In his “Dialogue
retirement age, take a good receive lower salaries than other departments or schools. might be a computer center, Concerning Natural Religion,” he sabotaged the Newtonian
look. You may be seeing the their MLS counterparts. The mood among some staffed by IT professionals and theology of designed creation that was popular in his day.
last of a dying breed, the pro- librarians is pessimistic. A New few books or librarians. What caused the first cause? he asked. Why do we celebrate
fessional librarian. Mexico librarian recently told Those of us who hold MLS divine design amid so much decay and misery? These provo-
Years ago, a librarian was A library-science me: “I spend most of my time degrees and are still working cations, in fact, operated effectively against a fairly narrow
someone who held a master’s making change and showing recognize the inevitability of range of theological argument: a rational religion emerging
degree in library science (MLS) degree can’t compete people how to print from the these trends. But large seg- from Lockean empiricism.
issued by a graduate program with online search, computer or use the copier. I ments of the American public Mr. Harris notes that Hume sought to examine religion
accredited by the American sure don’t get the reference struggle with literacy, or want from a “maximally detached” point of view, in order to
Library Association. Those of us but we still have a role. questions like I used to.” to study for the high-school “weaken the hold” of superstition. The Enlightenment often
who attended library schools A colleague in the Washing- GED, or are learning English congratulated itself for such campaigns of disenchantment,
underwent rigorous prepara- ton, D.C., area expressed simi- and want to know where they but how plausible was such a project for a philosopher who
tion, usually assignments that The erosion of the MLS de- lar views: “If I didn’t spend my can register to vote. We can still privileged sentiment and utility over truth? Mr. Harris
forced us to become familiar gree has been mirrored by the time helping people look for help children with their home- reminds us that Hume’s own disbelief—and not just the
with the reference books and disappearance of library lost keys, wallets, jackets, work and play a role in our religiosity of his opponents—might well be psychologized.
research tools that filled the schools from American univer- sweaters, gloves, backpacks, communities, as we have been Hume preferred philosophy to religion because philosophy
university library. sities. The University of Chi- cellphones and laptops, I’m not doing for over a century. “has little capacity to interrupt for long the course of our
The Internet changed all cago and Columbia University sure I’d even have a job.” The role for librarians and natural propensities.” As one who sought “morality without
that. The library user who used once offered the best librarian One bright spot: Some public public libraries is shrinking. austerity, pleasure without effeminacy, and a love of life
to rely on a librarian for help training programs in the coun- libraries have created jobs for But I imagine that in another without a fear of death,” Hume knew that atheism could
can now Google his question try; both institutions closed “technology assistants,” posi- hundred years, we will still be bring its own relief. Whether it was true was beside the
and find more data in a few sec- their library schools in the tions filled by tech-savvy young here, in one form or another. point.
onds than a librarian was able early 1990s. people with community-college
to locate in hours of research. Vanderbilt and the Univer- degrees and plans for informa- Mr. Barker is a librarian in Mr. Collins is a professor of history at Queen’s University
Many people who work as sity of Southern California also tion-technology careers. Librar- the Washington, D.C., area. in Kingston, Ontario.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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A14 | Monday, January 11, 2016 * * THE WALL STREET JOURNAL.
OPINION
REVIEW & OUTLOOK LETTERS TO THE EDITOR
A First Amendment Do-Over Crossing the Aisle Hasn’t Advanced the GOP
D
efending free speech has been a nota- cise their free-speech right. The union won’t Ever the Keynesian, Alan Blinder the last 27 years. A continuing budget
ble strength of the current Supreme vanish, or even lose its monopoly bargaining has forgotten, or never learned, that resolution a la Harry Reid would have
the $700 billion stimulus package at least kept the deficit from expand-
Court, and on Monday the Justices power. It will merely have less money to spend early in Barack Obama’s first term ac- ing and let the Democrats suffer a loss
hear a case that gives them a to influence politicians. complished nothing other than bal- of some of their precious entitlements
rare and splendid opportunity The Justices can correct The other union defense looning debt and not holding unem- and solar and wind credits.
to repair damage to the First a 39-year-old error on lows is that California’s law al- ployment under 8% as it was supposed PAUL MAHLER
Amendment done by the teachers to “opt out” of to do. Yet Mr. Blinder says that more Columbus, Ohio
Court itself. unions and free speech. the portion of the fees that stimulus is “welcome” (“A Glimpse of
In Friedrichs v. California goes to politics. But this opt- What Bipartisan Compromise Looks Prof. Blinder’s characterization of a
Teachers Association, 10 pub- out system is onerous, re- Like,” op-ed, Dec. 31). Zero-percent provision in the budget bill delaying
lic school teachers object to a California law quiring a teacher to make the request each rates, also a stimulus, haven’t spurred two ObamaCare taxes as a Republican
that forces them to pay union fees that finance year within a narrow window that is usually strong economic and employment victory misses the mark. The taxes
growth. Further, his definition of com- were included in the Affordable Care
causes they oppose. For 39 years the Court has about six weeks. If the teacher forgets to do
promise is very curious. President Act in support of the fiction that the
allowed such coercion thanks to an anomalous so, he is forced to subsidize union political Obama is the least compromising 10-year cost of ObamaCare would not
1977 ruling in Abood v. Detroit Board of Educa- causes for the year. This isn’t close to being president in memory. And where was exceed $1 trillion. Delaying the taxes
tion. Now is the time to overturn it. the “carefully tailored” process that the the compromise by the Democrats supports the free lunch meme which
As the brief for the teachers says, California Court has typically required when govern- with the stimulus and ObamaCare? will make repealing, replacing or im-
runs the “largest regime of compelled political ment is infringing on such a fundamental DAVID W. OGILVYproving ObamaCare more difficult. It
speech in the Nation.” It does so by coercing right as free speech. Tucson, Ariz.seems unlikely that any of the 166
teachers to pay roughly 2% of their pay in “af- If one or more of the Justices lack the nerve Democrats (90% of the caucus) who
filiate fees” to the union even if they choose to overturn Abood, fearing a progressive media Simple math tells me that Donald voted for the budget bill, or the 22
not to join the union. and political backlash, the least they can do is Trump, Ted Cruz and Marco Rubio who did not, saw delaying the taxes as
The California Teachers Association then require governments to let teachers keep the have approximately 60% of the early a Republican victory. In any event,
Republican primary votes. They all rail Prof. Blinder notes that “postpone-
takes that money and spends it on collective political portion of their dues money unless
against the status quo in Washington, ment isn’t a big deal” for Republicans
bargaining as well as a variety of political they “opt in” to the union scheme. D.C., and promise to confront it ag- or Democrats.
causes. It also sends some of it to the National Unions are so afraid they may lose this gressively. Instead of bashing these Although Republican support for
Education Association to spend nationwide. case that they have even thrown themselves current primary leaders, your journal- delaying the taxes may have helped fa-
California and the union argue that this coer- at the mercy of that great progressive bete ists should read and reread Mr. cilitate “bipartisan compromise,”
cion is justified because all workers benefit noire, Antonin Scalia. The conservative Jus- Blinder’s in-your-face crowing that helping the Democrats to achieve their
from union collective bargaining. tice wrote an opinion in a 1991 case (Lehnert “the deal was a big win for America” goals and not provoking union allies
But as the teachers point out, collective v. Ferris) that tolerated forced dues for union to help you understand the legitimate with their Cadillac plans should not be
bargaining in government is impossible to bargaining, and the union is throwing that and growing conservative anger. This seen as a victory for the GOP.
separate from matters of ideological speech. back at him in unquiet desperation. budget is another example of what ALAN STEVENSON
For public teachers, collective bargaining in- However, Justice Scalia has since voted with “crossing the aisle” has done to us for Reno, Nev.
volves wages and benefits that inevitably im- the majority in cases that recognized the First
plicate fiscal policy and the tax burden. It Amendment problems with union-fee schemes,
also includes such controversial political including Harris and Knox v. SEIU in 2012. Jus- Football and the Goals of Higher Education
matters as teacher evaluations and tenure. tice Scalia has always been alert to threats to President John Fry makes several and football has played a role in that
Individual teachers who object to the union’s free speech, and we find it hard to believe he valid points in his essay explaining rise.
positions on these issues must nonetheless would tolerate California’s coercive design. why football would be out of place at Like President Fry, I cringe when I
subsidize them. Conservative Justices are wary of overturn- Drexel University (“We’re Glad We read about college athletic programs
This violates what the Court said in 2014 ing precedents, and for good reason. Continu- Say No to College Football,” op-ed, that have lost their way. That’s why I
(Harris v. Quinn) is a “bedrock principle” that ity is crucial to the integrity of the law, and the Jan. 4). But I disagree with the core am as proud of our athletes perfor-
“no person in this country may be compelled Court cannot be seen as a body that overturns of his argument. A well-run football mance as students as their achieve-
program can create innumerable ben- ments on the playing field.
to subsidize speech by a third party that he or settled law based on the election returns. But
efits to a national university. The evi- The bottom line is this: Football
she does not wish to support.” the Court has a special obligation to re-exam- dence from our experience at Tem- isn’t right for every school, but
In her dissent in Harris, Justice Elena Kagan ine cases in which a fundamental constitu- ple—records for enrollment, academic strong and vigilant leadership by
justified this state coercion for unions on tional right has been compromised. rankings, alumni giving, research coaches and athletic directors can
grounds that the government has an interest Abood is an outlier in Supreme Court juris- funding—suggests that the student make college football a tremendous
in labor peace. But no great harm to the state prudence, and this is the chance to send it to and alumni engagement created by asset to a great university.
or the public is caused by letting teachers exer- the mistake file. our football program has a positive NEIL D. THEOBALD
impact on our academic programs. President
We use the revenue generated Temple University
Keystone No, Kenya Pipeline Yes from football to subsidize our 16 non-
revenue sports. Temple football also
Philadelphia
T
provides high visibility that benefits I note that Major League Baseball
ransCanada took Uncle Sam to court Kenya and Northeast Africa could certainly use
the entire university, as our recent doesn’t rely solely on scouting talent
last week to reclaim some of the dam- the investment and jobs that would come from success has shown. Our applications from colleges and universities. It has
age done by the Obama Administra- the oil project. Then again, so could the United are up another 12% from last year’s a farm system. Why can’t the NFL set
tion’s multiyear, drawn-out States. What’s with the double record, and I expect another highly up a farm system to develop players
rejection of the Keystone XL The U.S. says it wants standard on pipelines? diverse, academically talented class wherever they can be found, not just
pipeline. It may not come up to help finance an oil Meanwhile, TransCanada to enroll in the fall. Unlike schools from colleges and universities?
in the litigation, but someone said it is bringing an interna- that are struggling to fill seats, inter- DAVID J. LEIDEL
should point out that the same pipeline in Africa. tional arbitration case against est in Temple is at an all-time high Arlington, Texas
Obama Administration that the U.S. for not treating the
rejected Keystone seems to Canadian company the way it
have no problem supporting a new oil pipeline would an American company, as it is obliged to
project in Africa. do under the North American Free Trade Agree- Helping Children With Gender Dysphoria
That was the story last week out of Kenya, ment. The company said it would seek to re- Regarding Debra W. Soh’s “The tion possibly be a product of political
where U.S. Ambassador Robert Godec told cover some $15 billion in costs and damages, Transgender Battle Line: Childhood” correctness?
Kenya’s energy minister that Washington would and don’t be surprised if the case succeeds (op-ed, Jan. 5): There is good reason JOHN F. WINSLOW
help Nairobi raise $18 billion to finance its Pow- given the extraordinary regulatory barriers the why pediatrics is a branch of medicine. Washington
erAfrika project. The pipeline would stretch U.S. imposed on the investment. Though multi- We know that children are not “little
from Kenya’s Rift Valley to Lamu on the coast. ple reviews showed no environmental harm, adults” and the way in which we treat We have seen just how toxic politi-
“Kenya needs $18 billion worth of financing,” President Obama rejected the pipeline on arbi- them is much different than how we cal correctness can be when a subject
Mr. Godec said, according to a dispatch in Oil- trary political grounds. TransCanada also filed treat adults. We have hospitals specifi- is politicized. When it comes to how to
price.com, “so one of the questions we are dis- a suit in U.S. federal court claiming that Mr. cally dedicated to the care of children treat children with gender confusion,
and are aware of their physiological the truth becomes crucial. There
cussing is how we can work together with the Obama’s decision to block Keystone exceeded
differences—specifically the adoles- should be no shaming of those with
private sector and governments to raise that his constitutional authority. cent’s brain and its continual develop- “incorrect” points of view when the
sum, to find ways to make certain that this fi- These cases are worth watching, especially ment. Ask any parent who has raised a facts are far from known. I have only
nancing becomes available.” by those who still want the U.S. to welcome for- child to adulthood about the many one criticism. Ms. Soh states: “Trying
Has Mr. Godec checked with Secretary of eign investment. Meanwhile, U.S. taxpayers will “phases” their child has gone through, to turn a gay person straight is unethi-
State John Kerry, or, perhaps more important, want to keep an eye out to see if their dollars and how the emotions, personality and cal, because sexual orientation is im-
anti-oil Democratic financier Tom Steyer? are used to finance the Kenya project. character of that child have changed mutable.” That is poppycock.
throughout the years. It’s a difficult One of my best friend’s always re-
and complex issue that needs serious bellious daughter was a lesbian for 10
The Other Republican Campaign attention and should not be decided on
the merits of gender-identity politics.
years. That changed when she met, fell
in love with and married a man. These
O
When I was five I insisted on ex- issues are complicated and deserve far
ne of the big, if not often explicit, Re- reform plan he rolled out last week that would
ploring the world on my Big Wheel in more study. That won’t happen be-
publican debates this year is how the replace the hodgepodge of current federal pro- search of more speed. Fortunately my cause of the politics.
party can best reclaim the White House grams with “right to rise grants” that would parents didn’t buy me a sports car. SIMON SOBO, M.D.
and a new conservative politi- be administered by the DAVID MASUCCI Newtown, Conn.
cal majority. Will it be enough Some in the GOP are states. The grants would have Budapest
to ride the obvious wave of looking for a new a work requirement and time I find it ironic that the letters page
voter frustration and anger, or limits. In her attempt to discredit doctors’ has letters regarding the “possible”
does the GOP also need to of- anti-poverty agenda. Several participants efforts to support transgender chil- long-term carcinogenic effect of eat-
fer a more optimistic agenda stressed the benefits of the dren, Debra W. Soh offers a flawed ar- ing genetically modified soybeans and
that broadens its appeal? Earned Income Tax Credit, gument based on flawed research. By the next page has Ms. Soh’s article
The former attitude has dominated the which pays Americans below a certain income relying on “data” produced by Dr. Ken- that discusses treating children with
neth Zucker, a psychologist whose gen- “hormones to suppress puberty and
presidential nomination debating, but the lat- level who work. Chris Christie pointed out that der-identity clinic closed last year af- help the individual develop breasts or
ter was on stage Saturday in South Carolina he had doubled the EITC in New Jersey. We ter an external review found it “out of facial hair.”
at a forum sponsored by the foundation think the EITC has more problems than many step with current operational prac- l’ll take the long-term chance of a
named after the late, great Republican Jack conservatives admit, especially its vulnerabil- tices,” Ms. Soh thoroughly undermines possible carcinogen over a hormone
Kemp. Senator Tim Scott and Speaker Paul ity to fraud and its disincentive to work as it her own nonscientific musings. treatment that will impact a child’s life
Ryan hosted six GOP presidential candidates phases out over higher incomes. The reality is that people who sup- from the first day of treatment.
to discuss conservative policies to fight pov- As economist Casey Mulligan has docu- port transgender children also support PETER NASH
erty and improve economic opportunity for mented, the phase out of welfare benefits and letting girls play with trucks and buzz Omaha, Neb.
everyone. tax credits means that some recipients can their hair. We are fine with boys wear-
“We’ve been fighting a war on poverty for face a marginal tax rate of more than 100% as ing pink and painting their nails. But
over 50 years now, and I don’t think you con- they try to get ahead. Progressives ignore this there’s a difference between kids ex- We Need Gluten-Free Gas
pressing gender diversely and kids be-
clude anything other than this war is a stale- obstacle to success, but the Kemp forum par- ing transgender. One is about expres- I am encouraged by Merrill Mat-
mate,” Mr. Ryan said to open the event. “We’ve ticipants acknowledged it openly and made sion, the other about identity. thews’s “The Corn-Fed Albatross
treated poverty like they’re potholes that need clear any reform had to deal with it. What’s really happening here is that Called Ethanol” (op-ed, Jan. 6). My
to be filled up and then we move on,” adding The two candidates notable by their ab- doctors and parents are finally sup- key platform is to make all gasoline
that “we now have a safety net that is designed sence were Donald Trump and Ted Cruz. Per- porting our lives, even the youngest gluten free.
to catch people falling into poverty when what haps they think that as the front-runners in among us. To do otherwise danger- MIKE EISNER
we really need is a safety net that is designed New Hampshire and Iowa they don’t need to ously denies transgender children New Whig candidate for president
to help get people out of poverty.” worry about such wonky political issues as their very humanity—and their safety New Haven, Conn.
Thus the day reflected the intellectual fer- poverty and welfare reform. They’re riding the and well-being.
ment as conservatives seek alternatives to the frustration wave. JAY BROWN Letters intended for publication should
Human Rights Campaign Foundation be addressed to: The Editor, 1211 Avenue
Democratic agenda of ever-expanding benefits But if one of them does win the nomination,
Washington of the Americas, New York, NY 10036,
and what so often becomes permanent depen- he will need a message and agenda that attract or emailed to wsj.ltrs@wsj.com. Please
dency on government. more than GOP primary voters. The nominee A definition of bisexuality is the ca- include your city and state. All letters
One of the big themes is how to reward might even find he could use the ideas that the pacity to reorient gender desire from are subject to editing, and unpublished
work, which is the only sustainable route out other candidates took the time to discuss in one situation to the next. Could belief letters can be neither acknowledged nor
returned.
of poverty. Jeb Bush promoted the welfare South Carolina. in the immutability of sexual orienta-
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. Monday, January 11, 2016 | A15
OPINION
A
is doing among independents. A long, sider him. Marco Rubio is the most
terrible way to forecast drawn-out primary that forces candi- competitive among independents: 37%
the 2016 contest is to dates to make strong appeals to the said in December that they would con-
gauge whose supporters party’s ideological base can hurt the sider voting for him; only 32% ruled
are the loudest. Presiden- eventual nominee in November. him out. All the other GOP candidates
tial elections are not There are two ways that we can are under water. Forty-seven percent
decided by partisans or ideologues. measure how independents see the of independents said they would
The arithmetic is pretty simple: Republican contenders. On the posi- never vote for Jeb Bush, and 43% said
C
dents and the Christakises. The mined by our reasoning and sense of racial protest and social disruption group, preferably from within the
ollege students are returning to school reports that Ms. Christakis, a situation are actually shaped—not like that at Yale was not another group, who recognizes the unhealthy
school after the winter break, lecturer in early-childhood education, always to our benefit—by people Selma March or Birmingham battle direction events have taken and
and administrators must be has chosen not to teach this spring, with whom we’re socially engaged, against Bull Connor and his dogs. intervenes to help the students—even
bracing for another semester like the and her husband is on what Yale even those at some remove from our Rather it was what psychiatrists call if only a few—see the advances in
tumultuous one just passed. That called a “scheduled leave.” immediate circle. an “emotional stampede,” by a group racial matters achieved, both at Yale
trivial circumstances like those at Overlooked was the fact that the Mr. Christakis, working with longi- of sensitive young people living in a and in America. Such a person would
Yale University in November could target of the campus confrontation, tudinal research such as the culture of suspicion who were pro- know from experience that injustices
provoke such unrest indicates how Mr. Christakis, is one of America’s renowned Framingham Heart Study voked into believing that they had can occur, but could also shed light
fraught race relations remain at outstanding physician-scientists— that followed more than 5,000 adults been gravely injured—a belief that on the good intentions and racial
schools striving to promote diversity. and a person ideally suited to making in a Massachusetts town for decades they no doubt still hold. Yet these progress at the university. Putting
Ironically, an incident caught on sense of the events that gripped beginning in 1948, showed that individuals remain students in good the “long view” in front of the stu-
video at Yale—one that for many campuses in recent months. One can obesity, smoking, alcohol consump- standing at Yale, with all the privi- dents is essential, emphasizing the
Americans seemed to epitomize how tion, drug use and even personal leges that entails, having suffered no achievements America has made in
badly American higher education has happiness and altruism spread essen- setbacks other than their shared racial relations in the past decades
gone off the rails—also offers an ex- The work of the Yale tially as a kind of contagion within sense of injury. and from which the Yale students
planation for this spasm of protests professor who was berated the social cluster of relationships in Now, college students in general have profited.
and points toward a more productive which people are embedded. worry about their academic perfor- Changing the viewpoint of a few in-
way of addressing students’ con- by students helps explain He revealed that what one accepts mance and its effect on their future, dividuals in the cluster could have—
cerns. the ‘emotional stampede’ as a “norm” in behaviors and physical but these young people bore the just as did the triggering event—a
The incident involved a Yale pro- appearance depends on those of oth- added concern that the Yale commu- ripple effect on their friends and
fessor named Nicholas Christakis, and how to address it. ers—up to and including the friends nity harbored subtle forms of social friends of friends. If that viewpoint
who was waylaid on campus by angry of friends of one’s friends. Interest- injustice reflective of a racist Ameri- became more their norm, the students
students. They were livid about a let- ingly, Mr. Christakis has also shown can culture. Like any group that thinks would have a better opportunity to
ter written by his wife, Erika, also a presume that eventually, when his that these aspects of our behavior itself beleaguered, these students get what they came to Yale for: a first-
Yale teacher, who had suggested that feelings about this sorry episode will change in a coordinated fashion were sensitive to the feelings of their rate education, a reputation for
the university’s recent admonish- become less intense, Mr. Christakis when those of our friends—and, fellows, saw loyalty to one another as accomplishment, and entrée into a
ments about Halloween costumes, will dissect it. But until that time, let again, those friends of friends we’ve a principle and were responsive to any place of responsibility in America.
cultural appropriation and racial me—someone who has never met the not met—change in the same way. evidence of distress. It would require a certain amount
insensitivity perhaps were unneces- man but admires and teaches his I use these discoveries in teaching With today’s technology, they were of courage to take up this task, given
sary, since young adults are capable work—identify what seem the salient psychiatrists how to manage pa- able to stay in close contact through how emotionally charged American
of deciding for themselves what to matters and how what we’ve learned tients with depression and addic- social media, reinforcing the norms campuses are today. But advances in
wear for Halloween and might even from Mr. Christakis’s work might tion. For example: We can encourage within their group. In essence they race relations always seem to be
learn from being “a little bit obnox- help address the current destructive, alcoholics to attend 90 meetings of constituted a tightly knit, volatile marked by the actions of a brave few
ious.” Mr. Christakis was caught in an distressful climate on many cam- Alcoholics Anonymous in the 90 social cluster drawing away from the leading the way.
ugly scene, with one student in par- puses. days after discharge so as to embed other students at Yale, poorly
ticular roundly cursing him. In his research and in his 2009 them in a community of people com- equipped to judge coolly events Dr. McHugh, former psychiatrist in
Eventually the campus settled book, written with James H. Fowler, mitted to abstinence and help them impinging on their fears. chief at Johns Hopkins Hospital, is
when Yale’s president reassured the “Connected: The Surprising Power of take on sobriety as a norm in the This culture of suspicion at Yale the author of “The Mind Has Moun-
students that he understood their Our Social Networks and How They future. and other universities must be reme- tains: Reflections on Society and Psy-
feelings and would take measures to Shape Our Lives,” Mr. Christakis has How do these insights apply to the died for the academic pursuit of chiatry” (Johns Hopkins University
protect them from insult. Some dis- demonstrated how thoughts and disturbances that have convulsed U.S. social diversity to succeed. What is Press, 2005).
A
blue-collar workers, elite athletes, and McDonald’s still tolerates beards ety. Men, in the vein of Teddy Roose- prove. In 1944, during Dewey’s first
merica’s highest-ranking facial Hollywood stars and Silicon Valley only for religious reasons. velt, sought to prove themselves by presidential run, the conservative
hair has fallen to the razor. In CEOs. Observers may brush this off A shaved face, since the early climbing mountains and hunting journalist Edith Efron wrote about
November Paul Ryan made as a fickle fashion, but there’s more years of the 20th century, has signi- his mustache—and about the mus-
headlines when he quit shaving, to facial hair than meets the eye. fied the right sort of manliness: mod- tache in general: “It perplexes. It
becoming the first House speaker Most Americans are not aware, for ern, orderly, professional. These House Speaker Paul Ryan fascinates. It amuses. And it repels.”
with a beard since the appropriately example, that in 1976 the Supreme norms are enshrined in prejudice, A letter to the editor a month later
named Frederick Gillett in the 1920s. Court upheld the right of employers custom and law. Now, however, this loses the beard, the most agreed: “The man who decides to
But last week, as Congress came back to regulate their workers’ facial hair. definition of manhood is being chal- derided facial hair since sport lip adornment asserts his mas-
into session, Mr. Ryan once again The justices recognized that mus- lenged from both the left and right. culinity and desire to tyrannize over
banished the bristles, saying that he taches and beards carried social sig- We can glean insight into what is Thomas Dewey’s mustache. the home,” wrote Cornelia Von Hes-
would begin the new year with a nificance that might undermine the afoot—or, rather, aface—from the sert, a prominent model. “No matter
fresh start and a fresh shave. esprit de corps in police departments, last time beards achieved cultural how prettily he waxes it, droops it,
Mr. Ryan’s flirtation with whiskers corrode discipline in schools, and dominance: the era stretching from elephants. The beard became a sym- shingles it, at heart he’s the Man’s
is emblematic of a recent resurgence threaten businesses’ bottom line. the 1850s to the 1880s. The shift to bol of masculinity, a solace as women Man and ruler of his own roost.”
of beards in nearly every sector of Walt Disney banned facial hair on beards then was impelled by a claimed new rights and authority. Mr. Ryan received a similar
The unshaven today are likewise tongue-lashing from radio talk-show
compelled by pride and worry. As in host Laura Ingraham, who sarcasti-
Notable Quotable the late 19th century, our era extols
competition and celebrates self-reli-
cally referred to him as “the bearded
wonder” and said, “he’s got to lose
PUBLISHED SINCE 1889 BY DOW JONES & COMPANY
From Navy Secretary Ray ance. Traditional views of gender that beard; it makes him look ridicu-
Rupert Murdoch Robert Thomson
Executive Chairman, News Corp Chief Executive Officer, News Corp Mabus’s Jan. 1 “Memorandum for identity, marriage and family are un- lous.” Chalk one up for conservative
Gerard Baker William Lewis the Commandant of the Marine dergoing profound renovation. Men feminism: Women feel entitled to
Editor in Chief Chief Executive Officer and Publisher Corps” on “gender integration”: are again seeking the tangible assur- criticize the way a man looks, and
Rebecca Blumenstein; Matthew J. Murray, Deputy DOW JONES MANAGEMENT:
ance that a beard or mustache offers. shame him into changing his style.
Editors in Chief; Almar Latour, Executive Editor Anna Sedgley, Chief Financial Officer; Lastly, as we achieve full inte- However, there are powerful forces Which will it be: men regulated or
DEPUTY MANAGING EDITORS: Ashley Huston, Chief Communications Officer; gration of the force, mirroring even acting against this movement. Political unleashed? Mr. Ryan’s return to the
Paul Meller, Chief Technology Officer;
Michael W. Miller, Senior Deputy;
Mark Musgrave, Chief Human Resources Officer;
more closely the Nation we defend, leaders especially are held to an exact- razor indicates that we may soon
Thorold Barker, Europe; Paul Beckett, Asia;
Christine Glancey, News Operations and Talent; Katie Vanneck-Smith, Chief Customer Officer this is an opportunity to update the ing standard, because they must win witness “peak beard.” We live in
Neal Lipschutz, Ethics and Standards; OPERATING EXECUTIVES: position titles and descriptions to the public trust. In a study at Okla- uncertain and restless times, to be
Alex Martin, Enterprise; Ann Podd, Global Edwin A. Finn, Jr., Barron’s; Edward Roussel, demonstrate through this language homa State University last year, sure. But the history of Western civi-
Production; Andrew Regal, Global Head of Video; Innovation; Ingrid Verschuren, Data Strategy;
Jessica Yu, Global Head of Visuals
that women are included in these students were presented with paired lization has conditioned us, rightly or
Suzi Watford, Marketing;
Paul A. Gigot, Editor of the Editorial Page; Professional Information Business, Sales: MOSs [Military Occupational Speci- photos of bearded politicians and their wrongly, to read a well-shaved face
Daniel Henninger, Deputy Editor, Editorial Page Nancy McNeill, Global; William Ashworth, alities]. Please review the position clean-shaven counterparts. Female as the mark of a responsible and reli-
Americas; Florence Lefevre, Europe; Tomasz titles throughout the Marine Corps students perceived the hirsute men as able man.
WALL STREET JOURNAL MANAGEMENT:
Rustowski, Asia
Trevor Fellows, Head of Global Sales; and ensure that they are gender-in- less feminist, and said they were less
Chris Collins, Advertising; Christina Komporlis,
Circulation; Jason P. Conti, Legal;
tegrated as well, removing “man” likely to vote for them. Mr. Oldstone-Moore teaches his-
Joseph B. Vincent, Operations; Larry L. Hoffman, from their titles and provide a re- The Republican presidential nomi- tory at Wright State University. His
Production port to me as soon as practicable nee in 1948, Thomas Dewey, may book “Of Beards and Men: The
EDITORIAL AND CORPORATE HEADQUARTERS: and no later than April 1, 2016, so very well have lost that close election Revealing History of Facial Hair” is
1211 Avenue of the Americas, New York, N.Y., 10036 that it is included in the rest of the because he flouted convention with a just out from the University of Chi-
Telephone 1-800-DOWJONES
integration efforts. tightly cropped mustache. Women, cago Press.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A16 | Monday, January 11, 2016 THE WALL STREET JOURNAL.
WORLD NEWS
Myanmar
Clarity at
Leaders
Sign Deals
Before Exit
your fingertips.
BY SHIBANI MAHTANI
YANGON, Myanmar—This
country’s military-linked gov-
ernment, in its final weeks in
power, is passing legislation
that benefits departing law-
makers and awarding large
business contracts, including
one to a Chinese-led group to
build a sea port.
The legislation includes a
pension plan for departing law-
makers, most of whom belong
to the military-linked Union
Solidarity and Development
Party, which was defeated in
the country’s historic election
in November. Another proposal
would protect former presi-
dents from prosecution related
to acts taken in office and pro-
vide them with bodyguards.
The government of Presi-
dent Thein Sein has awarded
multiple contracts, which in
Myanmar don’t need legisla-
tive approval, without consult-
ing the next administration,
which will be led by the Na-
tional League for Democracy
under party leader Aung Saan
Suu Kyi, party officials said.
Mr. Thein Sein’s administra-
tion also transferred five idle
manufacturing plants last
month from the civilian-led
ministry of industry to the
military-controlled ministry of
defense. None of these actions
are prohibited under Myan-
mar’s political system.
Ye Htut, spokesman for Mr.
Thein Sein, said the presiden-
tial bill will “benefit not only
URBAN GARDNER A18 | CITY NEWS A18, A19 | PROPERTY MONDAY A20 | ARTS A21 | SPORTS A22
WSJ.com/NY * * * * THE WALL STREET JOURNAL. Monday, January 11, 2016 | A17
expected to take care of the re- At issue is a 15-year-old 40,000 square feet.
it should have to pay; maining $325 million, of which agreement under which the Mr. Degnan, a New Jersey
$150 million is to come from Port Authority would pay $10.5 appointee who became Port
revisiting a 2000 pact the Port Authority. million annually over 35 years Authority chairman in July
But John Degnan, the Port to lease 250 square feet inside 2014, has peppered the
BY ANDREW TANGEL Authority chairman, is asking the new train hall for two agency’s staff with questions,
the agency’s staff about the ex- ticket counters and a kiosk. including how to justify the un-
The chairman of the Port pected financing at a time The Port Authority’s ex- executed lease deal “in the face
Authority of New York and when it also needs to come up pected rental payments—its of the dramatic reduction of
New Jersey is questioning his with funding for other big proj- share of the $325 million gov- leased space” yet increased
agency’s potential contribution ects. ernment contribution toward rent, according to a memo sent
of nearly half the public fund- The questions about financ- the Empire Station project— Saturday that was reviewed by
ing expected for a recently pro- ing come in the early stages of were valued at $150 million, The Wall Street Journal.
posed overhaul of New York’s a plan announced last week to according to a Cuomo adminis- Mr. Degnan noted in the
Cooper Union’s 41 Cooper Square building in the East Village. Penn Station. overhaul Penn and revive a tration official. memo that the agency hadn’t
The revamp of the Midtown long-stalled effort to build a The terms of this unexe- factored lease payments into
Leader Search
Manhattan station complex is train hall inside a neighboring cuted lease deal shifted signifi- its capital and operating plans.
estimated to cost more than $3 post-office building—a project cantly during negotiations in He questioned the lease’s cur-
billion, and private developers New York Gov. Andrew Cuomo 2000. Initially the Port Author- Please see TRANSIT page A18
At Cooper Union
Creates Friction
BY MIKE VILENSKY Cooper Union tuition-free
again is the priority, and that
Cooper Union was rattled the president should be fo-
last year by a state investiga- cused on that. Their suggested
tion of its finances, the depar- candidate: U.S. Sen. Bernie
ture of its president and Sanders, the Vermont Demo-
boardroom infighting so crat running for president who
heated that a psychoanalyst has made college costs a focus
had been hired. of his campaign.
Now the Manhattan arts Others involved say they
and engineering school hopes are searching for the right
to find a new leader who can candidate, and his or her com-
right the ship, but the search mitment to free tuition is one
is already reopening old of several important factors.
wounds. A job listing released last
In December, Cooper Union month intensified the board-
resolved a lawsuit and probe, room friction, with critics say-
both related to its decision to ing it doesn’t mention the
begin charging tuition. A state school’s unique circumstances,
ALLEN EINSTEIN/GETTY IMAGES
35°
Hollins and reassigned general That Hollins would be fired Former Nets coach Lionel mer Duke Blue Devils forward.
Weather N.Y. Sports Lineup manager Billy King to a differ- is hardly a surprise. The Nets Hollins, left, and GM Billy King. It’s also rare to see a general
Real Feel ent role in the organization. have gone from dropping nail manager dismissed in the mid-
TODAY’S 7 p.m. Monday Assistant coach Tony Brown biters to getting clobbered, be- to an impressive body of work dle of a season, although this is
9 a.m. 19°
HIGH Bruins @ Rangers will serve as an interim coach ing outscored by an average of since being hired in 2010. His the second time that it has
5 p.m. 21°
for the remainder of the season. 11.5 points per game during 2013 acquisition of former Bos- happened to King—the Phila-
Record High “After careful consideration, their current four-game losing ton Celtics legends Paul Pierce delphia 76ers fired him in De-
63° (1975) I’ve concluded that it’s time for streak. Putting the team in and Kevin Garnett left the Nets cember of 2007.
SUNNY, Sunrise/Sunset a fresh start and a new vision Brown’s hands for the remain- without control of any of their The timing puts the Nets in
COLDER 7:20 a.m./4:49 p.m. 7:30 p.m. Monday for the direction of the team,” der of the season is a sensible first-round picks until 2019. a precarious situation ahead of
Spurs @ Nets said Prokhorov, who will hold a decision, if not an exciting one. And while the Nets have made the NBA’s Feb. 18 trade dead-
news conference at Barclays King’s demotion was a bit the playoffs for three consecu- line. For the time being, assis-
Tuesday’s High Center on Monday to discuss more surprising. tive seasons, Prokhorov has tant general manager Frank Za-
41° For N.Y. sports coverage, see A22 the moves. “By making this de- It’s not that King can point paid a steep price, shelling out Please see NETS page A22
CITY NEWS
CITY NEWS
A Capital View New York Gov. Andrew Cuomo speaking at a news conference at
the Javits Convention Center in New York City on Thursday.
Cuomo Plans
College Classes
For Prisoners
BY CORINNE RAMEY of reducing the prison popula-
tion, she added.
New York Gov. Andrew The state spends about
Cuomo on Sunday outlined a $68,000 a year for each in-
broad plan of education and mate in the prison system, a
job training in and outside the Cuomo administration spokes-
state’s prison system. The man said. “Short term it’s
goal, he said, is to halt a cycle more expensive,” Mr. Cuomo
of imprisonment and recidi- said of his initiatives. “Long
vism that disproportionately term it’s actually more cost-ef-
affects men of color. fective.”
As of 2014, the state’s Advocates of overhauling
MIKE GROLL/ASSOCIATED PRESS
PROPERTY MONDAY
What’s the
Deal Big Lease Play in Flushing
Crown Acquisitions
signs 99-year deal
valued at $1 billion;
MIDTOWN
site of Macy’s store
Luxury Gym Comes
To Park Avenue South BY KEIKO MORRIS
The owner of an early 20th
century office tower in Manhat- Family-owned Crown Acqui-
tan’s Midtown South is renovat- sitions signed a long-term
ing the property and bringing in ground lease valued at about
ALAN SCHINDLER
NEW YORK
ion, a New York judge has
given a major victory to de-
veloper Jeffrey Feil in his war
with other family members of
the multi-billion-dollar Feil
real estate empire.
Supreme Court Justice
Shirley Kornreich ruled
against Mr. Feil’s brother-in-
law, Stanley Barry, in what
GRANT gation” in
which Mr.
Barry “is pursuing a personal
vendetta” against Mr. Feil.
“The acrimony and conse- Family members, from left, Carole Feil, Marilyn Barry, Judith
quent expense associated Jaffe, and Jeffrey Feil, at a 2010 dedication of a research building.
with litigating ordinarily triv-
ial matters has risen to a The closely watched fight because he was asked by Mr.
level not ordinarily seen,” is one of three court battles Feil’s father in 1988 to leave
said the decision filed in late being fought in two states the family business. Mr. Barry
December. over a real estate empire that has said it was his decision to
Last week, Mr. Barry, 79 owns a nationwide portfolio leave.
years old, appealed the deter- that includes 26 million In her opinion, Justice
mination in a case that he square feet of space. Founded Kornreich held that Mr. Barry
launched in March 2012 over by Mr. Feil’s father, Louis Feil, hadn’t proved that the con-
one of the family’s many its holdings include the Fred tractors were overpaid or
holdings, Clermont York Asso- F. French Building on Fifth that there was a “quid pro
ciates, a company that owns Avenue and the General Elec- quo” scheme between Mr. Feil
two Upper East Side residen- tric building on Lexington Av- and the contractors. The “free
tial buildings with more than enue. work performed” on Mr. Feil’s
550 rental apartments. Mr. home “could not, on its own
Feil, 68, manages the build- cause harm to Clermont,” the
ings along with most of the
Mr. Feil said in court decision stated. “The only
family’s other properties. papers that Mr. harm to Clermont would be
Mr. Barry, who has a 12% alleged overcharges or faulty
stake in the company, had
Barry was ‘consumed work—neither of which was
been suing for at least $10 with animosity.’ shown.”
million in damages and for Justice Kornreich also de-
more access to records. He al- nied Mr. Barry’s request for
leged a wide range of abuses The biggest court battle, better access to financial re-
that Mr. Feil has denied. being fought in Louisiana, cords, noting he had been
Justice Kornreich dis- pits Mr. Feil against his sis- provided all that he has re-
Using the “Lion King” as a template, Disney’s live-theater missed Mr. Barry’s charges ters: Carole Feil, Judith Jaffe quested.
group has quietly turned “Aladdin” into one of Broadway’s saying they lacked proof and and Marilyn Barry, Mr. In legal papers filed as
said she agreed with Mr. Feil Barry’s wife. part of his appeal, Mr. Barry
top-grossing shows. Next step? International export. that Mr. Barry “simply does In the lawsuit that Justice listed several reasons for re-
not wish to see the case end, Kornreich ruled on, Mr. Barry versing the ruling. For exam-
regardless of merit.” alleged Mr. Feil abused his ple, Mr. Barry claimed Justice
Noting the expense of liti- control of Clermont, which Kornreich “wrongly held” that
Read more tomorrow in the Greater New York section. gation for more than three owns 444 E. 82nd St. and 445 he couldn’t allege “either a
years in the millions of dol- E. 80th St. Among other al- breach of fiduciary duty…or a
lars, her decision stated “this leged misdeeds, Mr. Barry ac- claim for an accounting” be-
action has been a net loss for cused Mr. Feil of overpaying cause he failed to directly
all parties, and future litiga- Clermont York contractors prove a quid pro quo agree-
tion would only continue to who also did free and dis- ment.
drain the company of more counted work on personal Mr. Barry’s papers go on
of a beloved family dog. At enduring appeal of fictional formal. I love Colm Tóibín.
teatime, they don’t tell the families and unlikely places He has extraordinary sen-
adults. for inspiration. Edited from tences which never give you
For years, the London- an interview: anything that summarizes or
based Ms. Hadley has won tells you what you’re meant
fans with meticulously Your novels have some- to be thinking.
crafted stories about fami- times been described as [He and I] both love
lies—and the tensions just “quiet.” What do you think [Henry] James. One of
below their surfaces. Since about this label? [James’s] gifts to writing is
her first novel, “Accidents in They don’t seem quiet to to make you think you can
the Home” (2002), she has me. I don’t really know have a tiny story which can
had 22 short stories pub- where it’s come from. In become a huge, huge thing.
lished in the New Yorker, “Clever Girl,” there were two “The Golden Bowl” is actu-
drawing comparisons to Al- violent deaths, a teenage Author Tessa Hadley walking through an abandoned house and gardens in Somerset, England. ally just two couples, slightly
ice Munro and Anne Tyler. pregnancy, an adulterous af- dodgily assembled, and two
“We may have had more fair. What do I have to do? see there is a style, and then in a painful way. What were you doing of them having an affair. It’s
stories by Tessa in the last 13 [Laughs] suddenly you’re surrounded when you had that revela- not “War and Peace,” the
years than by any other au- In this one actually, by it. The story takes an inter- tion? French aren’t invading Rus-
thor,” said Deborah Treisman, there’s sexual passion and esting dip into the past Actually, as does happen sia, and yet it seems vast.
the magazine’s fiction editor. kids stumbling on the big, Where did the initial halfway through. How did to me, I was in the bath. It’s
At 59, Ms. Hadley, who ugly, dark facts of life: death idea for this novel come that structure develop? a very good place because Why are you drawn to
published her first work at and that stash of pornogra- from? I suddenly had a sense you’re just cut off from fid- stories about families com-
age 46, is well known for her phy. There’s a near-accident I do remember very viv- that something was too flat, dling and working and fuss- ing together?
short stories. But with “The at the end and a teenage idly the image that the story that I wasn’t sure I could ing around. The family and the novel
Past,” her sixth work—and love story. started with. It is Harriet in- sustain the tension quite seem to me a very inevitable
the first with a U.S. book advertently eavesdropping right without having a point You’ve become well- match. There’s something
tour—she is poised to reach Are you a big Alice on her brother making love to which I could attach the known for your short sto- about the rambling, slow-
a wider readership abroad. Munro fan? to his new wife. I had it like present more vividly. And ries. Do you feel like “The cookingness of the novel
Released last week in the Huge, huge fan. She was a moment in a film, a then suddenly I thought, Past” is your most novel- form, which is long, which
U.S. by Harper, the novel was really transforming for me slightly dark Bergman-esque “Why am I holding back?” I like novel? unfolds over time and takes
published in the U.K. in Sep- when I first read her. She moment in a film, that sense thought, I’m just going to I do, actually. In my first a configuration at the begin-
tember to high acclaim. has that exquisite style of how it would discomfort give in to the temptation; novel, and certainly in my ning and twists and changes.
Harper is an imprint of Har- which is so relaxed that at her and sort of break her up I’m going to go back 35 second, I was effectively I mean, that sounds like the
perCollins, which like The moments you almost can’t and make her all over again years or whatever it is. structuring each chapter in a shape of a family.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A22 | Monday, January 11, 2016 * * THE WALL STREET JOURNAL.
SPORTS
Will Coughlin Fly the
Coop to Coach Eagles?
Tom Coughlin may soon Super Bowl wins and coach-
be back at MetLife Sta- ing against them for the di-
dium—not to be honored by vision rival Dallas Cowboys.
the team he led to two Seifert waited only two
championships but as coach years between leaving the
of a hated rival. San Francisco job and being
hired by then NFC West rival
Take a Number Carolina. (The Panthers later
moved to the NFC South.)
The Philadelphia Eagles Parcells also coached the
have asked for and received Jets the season after leading
permission to interview the New England Patriots to
Coughlin, according to re- Super Bowl XXXI, when they
ports. Seeing a coach you re- lost to the Packers.
placed turn up for a division The Jets faced a similar
rival is unusual even in the situation this season with
topsy-turvy NFL. Since 1990, Rex Ryan, whose father
it’s happened only eight Buddy (Eagles, Cardinals)
times, including twice by for- also makes the list of
SETH WENIG/ASSOCIATED PRESS
mer Giants and Jets coach coaches who crossed the di-
Bill Parcells. And only Par- visional divide. Ryan was
cells (right) and former able to exact revenge
49ers coach George against the Jets by lead-
Seifert coached in a ing his Bills to two wins
division against against the team that
teams they had fired him, including one
previously led to the in the season finale
Billy King, right, was stripped of general-manager duties after leaving the Nets without control of a first-round draft pick until 2019 Super Bowl. that bounced Todd
For Parcells, Bowles and
ON BEHALF OF
THE COUGHLIN FAMILY,
THANK YOU GIANTS FANS
FOR YOUR SUPPORT
THROUGHOUT THE YEARS.
WWW.TCJAYFUND.ORG
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
Backdoors
BUSINESS & TECH. Kohl’s Weighs ‘The Force’
Invite Break-Ins Sale or Split-Up Is Felt in China
KEYWORDS | B6 RETAIL | B3 MOVIES | B7
© 2016 Dow Jones & Company. All Rights Reserved. * * * * THE WALL STREET JOURNAL. Monday, January 11, 2016 | B1
Investors
Gain More
Drug Firms Ring In Higher Prices
BY PETER LOFTUS cost of already expensive average of 10.6% for more than In recent years, it has been Clinton, Bernie Sanders and
9%-10%
BY JOANN S. LUBLIN cisms of prescription costs in treats a sleep disorder in blind throughout the year—analysts analyst David Steinberg said in
the U.S. people, by 10%, to $148,000 a said. But this latest round of an interview. “Unlike other
American businesses in- Pfizer Inc., Amgen Inc., Al- year, a spokeswoman said. price hikes is significant in countries, there’s no mecha-
creasingly are bowing to in- lergan PLC, Horizon Pharma Piper Jaffray analysts say the Amount that some big U.S. light of the political pressure. nism whereby regulatory au-
vestors’ demands for greater PLC and others have raised price of the once-daily capsule companies have raised prices Politicians, health-care pay- thorities can control price.”
boardroom clout, with dozens U.S. prices for dozens of is now 76% higher than when for dozens of branded drugs ers, doctors and patients have Mr. Steinberg said rebates
of companies revising their branded drugs since late De- it was introduced in 2014. since late December criticized drug pricing in re- and discounts are likely to
bylaws in recent weeks ahead cember, with many of the in- The Vanda spokeswoman cent months, saying medicines partly offset some of the latest
of this year’s annual meetings. creases between 9% and 10%, said the cost of Hetlioz is are out of reach for many pa- price increases, but companies
Proxy access, embraced by according to equity analysts. “within the price range of Pfizer also left prices un- tients and straining health- typically don’t make public the
117 U.S. companies during 2015, The increases are on list treatments that address simi- changed for about 10 products. care budgets. U.S. prescrip- magnitude of such conces-
gives shareholders more power prices, before any discounts or lar size populations,” noting A Pfizer spokesman said tion-drug spending rose 12.2% sions.
to oust directors and influence rebates that manufacturers that fewer than 1,000 patients the company offers “consider- in 2014, accelerating from Repeated increases in list
corporate strategy by letting sometimes provide insurers currently take the drug in the able discounts” off the list 2.4% growth in 2013, the Cen- prices eventually can wipe out
them list competing board can- and other payers. U.S. prices, and the company pro- ters for Medicare and Medic- the value of prior discounts,
didates on ballots for annual Some of the increases add Since New Year’s Day, vides medicines for free to pa- aid Services said last month. said Rick Bruzek, vice presi-
meetings. About 21% of S&P 500 thousands of dollars to the Pfizer has raised list prices an tients meeting income criteria. Presidential candidates Hillary Please see DRUG page B2
companies have adopted proxy
access, up from about 1% in
initially challenged 74 more Ford Motor Co., Tesla Motors able to respond to the rapid ur-
companies, including 3M Co., Inc. and Fiat Chrysler Auto- banization he sees coming.
NVR Inc. and Home Depot Inc., mobiles NV, the company aims The to-do list includes look-
to adopt or improve proxy ac- to catch up with industry lead- ing at a range of partnerships,
cess this year. ers by developing a vehicle including alliances and potential
Mr. Stringer’s new drive fol- able to meet American buy- acquisitions, and experimenting
lows his similar 2015 initia- ers’s demands and the nation’s internally with new business
tive, supported by an influen- tough regulatory standards. lines, such as ride-hailing and
tial bloc of public pension The Indian auto maker pay-by-minute car rentals.
funds in various locales. Forty- doesn’t sell many sport-utility For years, Mr. Ford has spo-
three of their 66 shareholder vehicles in developed markets. ken out about the problems cre-
resolutions for proxy access However, at home it is battling Mahindra’s Troy facility is within a 20-mile radius of more product-development resources than ated by increased congestion in
won majority support at an- global auto makers rushing to Munich, the home of BMW, Stuttgart, where Daimler resides, and Wolfsburg, VW’s base, combined. the world’s major cities and the
nual meetings last year. India, including Hyundai Mo- need for mobility alternatives as
TIAA-CREF, a big asset tor Co. and Honda Motor Co., doesn’t pivot, it is in danger of chief Rajiv Mehta calls “a hindra’s ability to meet the people’s attitudes toward car
manager, separately mounted which are gobbling up market running into the same fate Mecca for SUVs,” is a natural most stringent standards, ownership change.
a letter-writing campaign to share using resources and ex- that nearly shut down Detroit. place for the company to learn company officials say. “To me, it’s a way to reinvent
its top 100 U.S. holdings last pertise Mahindra lacks in its Mahindra stumbled in its how to do that. “Two years ago, a customer this company that makes it in-
year and urged those compa- domestic market. first attempt to go global, and Mahindra’s first made-in- [in India] wouldn’t have paid credibly relevant for the next 50
nies to improve the ability of In recent years, the com- several years ago ended an ef- Detroit project in its 70-year for ABS (anti-lock braking) or years,” said Mr. Ford, who has
shareholders to nominate di- pany has bought a Korean auto fort to bring an India-devel- auto making history—a large air bags,” Pawan Goenka, Ma- been chairman since 1999. “If
rectors. Thirty-nine firms maker, an Italian design house, oped pickup truck to the U.S., SUV the size of a BMW X5 hindra’s automotive chief, said we did nothing, we could be
made the move or committed an electric-vehicle maker and a setback that still has it tied dressed in camouflage—is be- in an interview. “Today, 75% of consigned over time to an ever-
to proxy access by early 2016. other assets in an attempt to up in litigation. The company’s ing tested on the streets of the customers want to buy dwindling number of traditional
“We are continuing to have boost its game, but its market senior executives say they are Metro Detroit. Global safety those options.” car and truck buyers.”
conversations” with the rest, share is still slipping, much still intent on becoming a and fuel economy regulations The marriage of an Indian Mr. Ford’s conviction is rep-
said Bess Joffe, head of corpo- like Indian rival Tata Motors global force and Detroit, which are tightening significantly, auto maker and the Motor City licated in the offices of auto
Please see PROXY page B2 Ltd. If the company’s focus Mahindra’s product planning and this SUV is showing Ma- Please see INDIA page B4 Please see FORD page B4
A-B
Affymetrix...................B3
Alcoa.......................B3,C1
Allergan.......................B1
General Motors...........B4
Global X FTSE Greece
20 ETF.......................R7
Global X FTSE Portugal
Oculus VR....................C6
Pacific Investment
Management.............C3
Pearson, Simon &
Railroads Face More Tough Track
Allstate.......................A1 20 ETF.......................R7 Warshaw...................C3 BY LAURA STEVENS analyst with Sanford C. Bern-
Alphabet Cl C.B4,R4,R12 Global X Funds............R7 Pennsylvania State stein.
Amazon.com ............... R4 Goldman Sachs Employees' Retirement
American Eagle ActiveBeta Emerging System......................C2 Railroad operators are fac- Union Pacific Corp. and
Outfitters..................B3 Markets Equity ETF.R2 Pfizer...........................B1 ing another rough ride this CSX have responded by lay-
Amgen.........................B1 Goldman Sachs Group Polen Growth year, as global uncertainty, ing off employees, storing lo-
Anbang Insurance Group .......................... C1,R2,R5 Fund;Investor............R4
Heartland Value Fund R9 Pratt & Miller sliding oil and commodity comotives and reducing op-
..................................... C3
Anchorage Capital Group Horizon Pharma..........B1 Engineering...............B4 markets and weakening man- erations. Norfolk Southern
..................................... C3 Hyundai Motor ...... B1,B4 Progressive.................A1 ufacturing rattle their big- Corp. closed down one of its
Apple.................B1,B6,C6 Illumina.......................B2 Prudential Jennison
Select Growth Fund.R4
gest shippers. three headquarters last year,
Arch Venture Partners Institutional
.....................................B2 Shareholder Services Q Beginning Tuesday, when and said it plans to cut back
Bezos Expeditions......B2 .....................................B1 Qualcomm...................B6 CSX Corp. reports fourth- on some operations affected
BlackRock...............C3,R5 Intel.............................B6 Quinn Emanuel Urquhart quarter results after the mar- by coal’s decline.
BlackRock Impact U.S. iShares Currency
Equity Fund...............R5 Hedged MSCI Eurozone
& Sullivan..................C3 ket closes, rail- One silver lining is that
BlueCrest Capital ETF............................R7 R-S-T THE WEEK roads are the reduced rail traffic has
Management.............C3 iShares MSCI EAFE ETF RatPac EntertainmentB7 AHEAD expected to de- enabled the railroads to im-
BlueMountain Capital R7 Regeneron
Pharmaceuticals.......R4
liver dour ex- prove their service. Accord-
Management.............C3 iShares MSCI Emerging
BP ................................ C6 Markets Minimum Rosneft........................C6 pectations for ing to an analyst report by
Bridgewater Associates Volatility ETF............R2 Saba Capital the year ahead. Nomura, the average speeds
..................................... C3 iShares MSCI Eurozone Management.............C3 The end of 2015 was at the four major U.S. rail-
Broadcom .................... B6 ETF............................R7 Samsung Electronics..B6
Saudi Aramco..............C6 hardly smooth, as an unsea- roads were up 15% as the
C-D iShares MSCI Ireland
Capped ETF...............R7 Sears Holdings............B3 sonably warm winter, higher year began, exceeding record
Calvert Investments...R5 SoftBank Group .......... C2
Chevron........................C6 iShares MSCI Italy retail inventories and indus- 2012 service levels.
Capped ETF...............R7 Sprint...........................C1
China Life Insurance...C3 Starbucks....................R4 trial weakness extended the Railroads may also be able
China Minsheng Banking iShares MSCI Spain
Capped ETF...............R7 Sutter Hill Ventures...B2 year’s slide in rail volumes. to command higher rates
..................................... C3 Tesla Motors...............B1
Chi-X Global................C3 J-K-M Intermodal shipments—con- from shippers who are seeing
Tesla Motors...............B4 tainers and trailers also car-
Citigroup.................B1,C1 Janus Capital Group...R9 Texas Instruments ..... B6
less in the way of fuel costs
Columbia Threadneedle Janus Real Return Fund Thermo Fisher Scientific ried by trucks—were an ex- being passed through to
Investments..............C2 .....................................R9
Columbia U.S. Social
.....................................B3 ception, but they grew only them, analysts said. And a
Janus Short-Term Bond Thomson Reuters.......R2
Bond Fund.................R5 Fund .......................... R9 slightly. federal requirement for
Thornburg Developing
CSX..............................B2 Kohl's...........................B3 World Fund;A............R2 Total U.S. rail traffic de- trucks to install new technol-
Daimler........................B4 Macy's.........................B3 Toyota Motor..............B4 clined 2.5% last year to 28 ogy could take as much as
Deutsche Bank............C3 Mahindra & Mahindra B1 TPG Capital.................C4 million carloads and contain- 7.5% of the fleet out of com-
Dewey & LeBoeuf.......B3 Marvel Studios.........A12 21st Century Fox........B7
DoubleLine Core Fixed McDonald's..................B1 ers, according to the Associa- mission in the second half
Income Fund;I...........R8 U-V-W
MediaTek.....................B6 tion of American Railroads. the year, according to Ste-
Dyax.............................C1 Microsemi....................C2 UBS Group...................C1
For this year, Stephens Inc. phens, adding an incentive
E-F Momenta Vanda Pharmaceuticals
Pharmaceuticals.......B3 B1 analysts forecast a 1.6% de- for shippers to use rail.
Exxon Mobil ................ C6
VIKTOR KOEN
Morgan Stanley .......... C1 Van Eck Emerging cline. Hanging over the industry
Facebook...........B6,C6,R4
Markets Fund;A........R2
Fiat Chrysler Mylan...........................B3
Van Eck Global............R2
Adding to concerns, China’s is Canadian Pacific Railway
Automobiles ............. B1 N-O-P Vanguard FTSE stock markets have plunged Ltd.’s $30 billion bid for rival
Fidelity Investments..R8
Ford Motor.............B1,B4
Netflix.........................R4 Emerging Markets ETF this month amid broader wor- Norfolk Southern. The pur-
New Regency Pictures .....................................R2 ries about that nation’s econ- suit has been rebuffed since
G - H -I .....................................B7 Via Technologies.........B6
Geico..........................A12 Nike.............................R4 Walt Disney................B7 omy. U.S. companies have its disclosure in November,
General Electric .......... B3 Occidental Petroleum.B1 Wimmer Financial...... R5 been relying on China for but CP has said its next steps
sales growth, and further tur- may include launching a
DRUG
Ficklin, Damon............R4 Musk, Elon..................B4 Tannuzzo, Gene...........C2 Inc. raised the price of its
Flatley, Jay..................B2 Nasgovitz, Bill ............ R9 Tarullo, Daniel ............ A2 drug Ampyra, which is used to Prescribed Pricing
Ford, Bill......................B1 Nasser, Jacques..........B4 Watters, Darrell..........R9
Ford, Nick....................R7 Neithart, Robert.........R7 Wilson, Tom..............A12 help multiple-sclerosis pa- Price increases since late December for selected branded drugs
Gates, Bill ................... B2 Noble, John.................C6 Wimmer, Per...............R5 tients improve walking, by 11%
Glasscock III, Sam ...... C6 Peng, Nicole................B6 Xiaohui, Wu ................ C3 Continued from the prior page on Jan. 1, to an annual cost of Drug (Manufacturer) Condition Increase
Goenka, Pawan...........B1 Peron, Matthew..........C2 Zittrain, Jonathan ...... B6 dent of pharmacy services at more than $23,650 a patient.
Graham, Lindsey.........A4 Petrou, Karen..............A2 Zuckerberg, Mark........C6 HealthPartners, a Blooming- Acorda offers rebates and Lidoderm (Endo) Pain 25%
ton, Minn., insurer and hospi- discounts off the list price that Viagra (Pfizer) Erectile dysfunction 12.9%
tal operator. are likely to cut about 40%
PROXY
Hetlioz (Vanda) Sleep disorder in blind people 10%
vance notice that any share- Amgen raised the price of from the latest price increase,
holder was considering a the anti-inflammatory drug on average, Chief Executive Restasis (Allergan) Dry eyes 9.9%
shareholder proposal on the Enbrel by 8% in late December, Ron Cohen said in an inter- Namenda XR (Allergan) Alzheimer’s disease 9.9%
topic,’’ and directors had con- according to Raymond James, view. The company has raised
Continued from the prior page sidered proxy access for over a following an 8% increase in the price several times since Lyrica (Pfizer) Pain 9.4%
rate governance at TIAA-CREF. year, a 3M spokeswoman said. September and a 10% increase the drug was approved in Actimmune (Horizon) Chronic granulomatous disease 9%
The rapid spread of proxy ac- Fourteen of the other busi- last May. Enbrel costs about 2010.
cess also has been spurred by nesses that received Mr. $704 a week for the typical Dr. Cohen said it took more Trulicity (Eli Lilly) Type 2 diabetes 8%
companies’ expanded outreach Stringer’s proposal for 2016 dosing for treatment of rheu- than a decade to develop Enbrel (Amgen) Rheumatoid arthritis 7.9%
to major investors and direc- also have already endorsed matoid arthritis, according to Ampyra. He said Acorda is de-
Copaxone (Teva) Multiple sclerosis 7.9%
tors’ desire to avoid the ire of proxy access, a Stringer CMS, or more than $36,600 a veloping additional drugs for
proxy advisers that often op- spokesman said. Mr. Stringer year. conditions including Parkin- Note: Price increases don’t reflect any discounts offered by manufacturers
pose their re-election when dropped another two compa- The drug’s new cost is son’s disease. Ampyra gener- Sources: the manufacturers, Jefferies & Co., Deutsche Bank, Raymond James
management ignores a measure nies for technical reasons. about four times its cost at ated $315 million in sales for
garnering majority support. But some, such as NVR, op- launch in the 1990s, said Ray- the first nine months of 2015,
Dozens of companies made pose New York City’s efforts. mond James analyst Christo- or 87% of total company reve- wrinkle-smoother Botox, and vides financial assistance to
the change in recent weeks The home builder wants secu- pher Raymond. The price hikes nue. Namenda XR, a treatment for help patients afford its drugs.
amid looming deadlines for in- rities regulators to block the for Enbrel and other drugs The price hikes are “our Alzheimer’s disease. Botox There were some notable
vestors to submit 2016 annual city’s binding resolution from “seem to have increased in way of insuring that we can went up 3.8%. exceptions to the price in-
meeting proposals. At least 10 coming to a vote this year be- magnitude and frequency,” he survive and develop these pro- An Allergan spokesman creases. Valeant Pharmaceuti-
proxy access bylaws arrived ev- cause the company adopted a said. grams and bring these new in- confirmed the price increases cals International Inc., which
ery week during much of De- limited form of proxy access in An Amgen spokeswoman novative drugs to market,” he but declined further comment. came under fire last year for
cember, said Patrick McGurn, November. NVR requires in- said the price of Enbrel re- said. Horizon Pharma boosted sharply raising prices, hasn’t
special counsel for ISS. vestors to own at least a 5% flects its clinical benefits, Allergan, which has agreed prices for five drugs by 9% to raised prices since September,
3M beat the New York City stake before they can nomi- while helping fund “continued to be acquired by Pfizer for 9.9%, Jefferies said, including according to Deutsche Bank.
pension funds to the punch. nate directors. It declined to scientific innovation.” $160 billion, boosted prices by ActImmune, a treatment for A Valeant spokeswoman
The industrial conglomerate comment, as did Home Depot, Mary Brainerd, chief execu- an average of 9.1% for more hereditary diseases. The com- said changes in the company’s
disclosed its directors’ en- which lacks proxy access. tive of HealthPartners, said than 40 brands so far this pany’s price increases were product lineup have made
dorsement of proxy access, ef- Investors have yet to use drug-industry practices “are year, and left unchanged the subject of a page-one arti- pricing a smaller part of its
fective immediately, in a Nov. their improved entry into board- becoming increasingly intoler- prices for about 20 other cle in The Wall Street Journal expected sales growth. Valeant
10 regulatory filing. The same rooms. But “in the next two or able for consumers, health brands, according to Deutsche last year. canceled nearly all of its
day, the city’s pension funds three years, we might start to plans, doctors and hospitals.” Bank. The increases included A Horizon spokesman said planned price increases for the
sent 3M a similar proxy access see one or two instances,’’ said Drugmakers say they need 9.9% hikes for eye drug Resta- pricing for its products “isn’t fourth quarter, and expects fu-
measure for 2016. Cam Hoang, a partner at Dorsey to raise prices to fund risky sis, the company’s second a key driver” of its business, ture price hikes to be more
“We did not have any ad- & Whitney LLP. research. Acorda Therapeutics highest-selling product after and that the company pro- modest, she said.
gene-sequencing machines zos Expeditions, Bill Gates disease. The company will cause problems yet lead pa- ing the test, said Mr. Flatley,
said Sunday it is forming the and Sutter Hill Ventures, Mr. have a “preferential economic tients to undergo further tests adding that the price will have
company, called Grail, with a Flatley said. The company an- relationship with Illumina” and procedures that come to come in under $1,000 ini-
group of other investors, nounced the launch on the eve and its DNA sequencing ex- with harmful side effects. tially and come down further
marking the latest bet that so- of the annual J.P. Morgan pertise, Mr. Flatley said. Mr. Flatley said a blood test after that.
called liquid biopsies will be- Healthcare Conference here. That will make it possible avoids some such problems He said Grail will spend the
come a major tool for detect- Researchers have long The slide on which an Illumina to perform the especially de- because unlike, for example, next year refining the test be-
ing, diagnosing and managing known that evidence of tu- machine sequences DNA. tailed analyses of DNA frag- suspicious findings from mam- fore testing it in clinical trials
treatment of cancer. mors lurks in the blood, either ments needed to develop and mography, which can have a beginning in 2017. If all goes
The test will be designed to in the form of circulating tu- ably enable doctors and pa- validate the test and to market variety of causes, “we are ac- well, a test to detect evidence
screen people who have no mor cells or in fragments of tients to detect and moni- it at an affordable price. He tually measuring mutations of any cancer—what he
cancer symptoms and detect DNA that are shed from tumor tor the disease without painful estimated the company will from cancer cells.” It is “a di- termed a “pan-cancer screen-
disease at its earliest stages cells. That has raised hopes and sometimes misleading tis- have to sequence between rect measure of the cancer it- ing test”—could be on the
when the chance to cure it is for a blood test that could reli- sue biopsies that are com- 100,000 to 300,000 human ge- self,” he said. market by 2019.
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THE WALL STREET JOURNAL. * * * * * Monday, January 11, 2016 | B3
BUSINESS NEWS
Contract JOHANNESBURG—Miners
are sifting through the detritus
plant. There, it passes through
filters and is finely ground be-
fore being treated with cya-
BY JOHN W. MILLER ore for traces of gold they may forged into rough bars and
still contain. flown to a nearby foundry—by
Alcoa Inc. said it The mounds are the legacy helicopter—to evade South Af-
would announce a $1.5 billion of a mining industry that has rican bandits, who often hijack
long-term supply con- yielded nearly half of the armored cars.
tract Monday with General world’s gold bullion and jew- For each ton of reprocessed
Electric Inc.’s aviation unit, elry since the precious metal ore, an average of just 0.2
underscoring the aluminum was discovered here in the late gram of gold is extracted. DRD-
producer’s efforts to offset dif- 1880s. After digging out raw Gold goes through two million
ficult conditions in its raw- ore from the ground, miners metric tons of ore a month. In
aluminum business. extract what gold they can its 2015 fiscal year that ended
The announcement will from the mix, leaving behind June 30, the company pro-
come the same day as New hills of discarded ore as waste. duced 150,145 troy ounces of
York-based Alcoa reports what Over the years, these A water cannon blasts mining refuse in Johannesburg. Miners are searching for gold in mounds of ore. gold, up 13% from the previous
is expected to be its worst mounds—many now overgrown year.
quarterly results since early with scrub or abutting shanty- While gold prices have fallen company here focused solely fort could go a long way toward The scavenging comes as
2014, including a 17% drop in towns—have been subsumed sharply from their all-time high on reprocessing mine waste. getting rid of the waste, critics conventional mining declines.
revenue from a year earlier by the sprawling city, becom- in late 2011, they are still buoy- Sibanye Gold Ltd., South Af- say the industry hasn’t gone far South African gold miners are
and earnings of two cents a ing part of its geography. But ant enough to make the effort rica’s top gold producer, and enough in addressing the envi- battling rising labor and elec-
share, according to a poll of the mounds still contain trace profitable. Executives also style AngloGold Ashanti Ltd., the ronmental hazards. tricity costs as they dig ever
analysts. Raw-aluminum prices amounts of gold. Until recently, the work as part of a cleanup world’s third-largest gold DRDGold uses water cannons deeper for dwindling reserves.
have fallen over 25% to about going back for those scraps drive, ridding the city of waste miner, are also now working to blast a ton of water every Output has halved in the past
$1,500 per ton in the past wasn’t worth the trouble. that irritates eyes and throats over old dumps. In the first four seconds at the mounds. On decade, pushing South Africa
year. Details of the GE Today, though, companies and contains cyanide, a chemi- half of 2015, about a fifth of one recent morning south of Jo- from first to sixth on the list of
deal were in a news release like DRDGold Ltd. are using cal used in conventional mining, AngloGold’s production came hannesburg, a DRDGold worker global gold producers.
viewed by The Wall Street high-powered water cannons to and uranium that is latent in the from going back through min- in goggles and a waterproof At today’s prices for gold—
Journal. Alcoa will disclose blast many of the towering dug-up earth. ing residue, as well as dis- jumpsuit was using his roaring about $1,100 an ounce—about a
fourth-quarter earnings after dumps open again, pushing “Hopefully one day, 20 years carded ore that was never pro- water cannon to turn a powdery quarter of the waste still lying
the market close on Monday. their contents through miles- from now, all the mine dumps cessed in the first place. gray cliff-face of one partially around the city is profitable to
As usual, it will be first major long pipes to processing plants in Johannesburg will be gone,” It is hard work for thin mar- vanished mound into a torrent reprocess, said Jaco Schoeman,
U.S. company to report, set- that can extract tiny gold rem- said Niël Pretorius, chief execu- gins. And while many inside and of ashy sludge. operations director at DRDGold
ting the tone during a volatile nants. tive of DRDGold, the biggest outside the industry say the ef- The slurry is pushed into subsidiary Ergo Mining Ltd.
time for the stock market.
Alcoa will supply advanced
nickel-based superalloy, tita- cer, Joel Sanders, say their clients
American Eagle May Disappoint THERMO FISHER SCIENTIFIC
nium and aluminum compo-
nents for engines and for en-
Business are prepared to take the financial
fraud case back to court, despite
Affymetrix Is Sold
gine parts made by GE. “We
greatly appreciate GE’s contin- Watch plea deals offered to both that
would have required having a fel-
For $1.3 Billion
Thermo Fisher Scientific Inc.
ued confidence in Alcoa’s ony on their record. They have will buy Affymetrix Inc. in a
aerospace capabilities,” said maintained their innocence. roughly $1.3 billion cash deal
Alcoa Chief Executive Klaus In court Friday, New York that would boost its biogenetic
RICHARD B. LEVINE/NEWSCOM/ZUMA PRESS
Kleinfeld in the release. state court Judge Robert Stolz analysis portfolio, the company
Alcoa will make the parts in DEWEY & LEBOEUF said there was a “déjà vu aspect said Friday.
six U.S. states, as well as to all this.” Judge Stolz declared Under the terms of the deal,
France and Canada. Alcoa said
Dewey Retrial Won’t a mistrial in October once a jury which requires approval by Af-
its aerospace division secured Include Ex-Chairman failed to reach verdicts on major fymetrix shareholders, Thermo
“approximately $9 billion” in A watered-down retrial of counts against Messrs. Davis, Di- Fisher is to pay $14 a share in
contracts during 2015. It has former Dewey & LeBoeuf LLP Carmine and Sanders. cash. Affymetrix’s shares closed
also signed billion-dollar-plus executives is set for September, —Sara Randazzo Friday at $9.21. Thermo Fisher
deals to supply Boeing Co. and but the do-over of the financial said the deal would add 10
Airbus Group SE. fraud case won’t include the PHARMACEUTICALS cents a share to adjusted profit
Alcoa had already signaled firm’s ex-chairman, Steven Davis. in the first full year of owner-
plans to spin off its lucrative Under a deferred prosecution
Mylan, Momenta American Eagle Outfitters Inc. indicated core sales could be below ship and result in about $70 mil-
parts business during the sec- agreement finalized Friday, pros- In Biosimilar Venture Wall Street’s expectation, despite what the retailer called a solid lion in savings by year three.
ond half of 2016. The spinoff ecutors said they will dismiss Mylan NV and Momenta holiday. It said its same-store sales are up 4% so far in the quarter. Santa Clara, Calif.-based Af-
will also supply aluminum the charges against Mr. Davis af- Pharmaceuticals Inc. said Friday Analysts polled by Retail Metrics had forecast growth of 4.7%. fymetrix, which carried an accu-
sheet to auto makers. ter five years if he doesn’t com- they would jointly develop and mulated loss of about $500 mil-
As it trumpets parts-mak- mit any crimes in that period or commercialize six biosimilars. lion as of Sept. 30, has about
ing deals, Alcoa continues to practice law in the state of New Mylan will make an upfront $350 million in annual revenue,
close smelter production in York. Mr. Davis hasn’t admitted cash payment of $45 million to costs and eventual profits. a biosimilar for Orencia, a rheu- while Waltham, Mass.-based
high-cost areas like the U.S., any wrongdoing under the deal. Momenta and could pay up to Mylan will lead world-wide matoid arthritis treatment. The Thermo Fisher has about $17
Europe and Australia. Since Attorneys for Dewey’s former $200 million if milestones are commercialization, and Momenta companies didn’t identify the billion in annual revenue, accord-
2007, it has closed or sold 48% executive director, Stephen DiCar- reached. Each company will has the option to co-commercial- other five biosimilars in the deal. ing to regulatory filings.
of its raw-aluminum capacity. mine, and ex-chief financial offi- equally share the development ize in the U.S. The deal includes —Austen Hufford —Maria Armental
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
B4 | Monday, January 11, 2016 * *** THE WALL STREET JOURNAL.
AUTOS
wanting to drive gasoline-pow- cluding steering or braking, and says Ford is in a good posi- The Scheuer trial is the first
ered vehicles within 30 years. while Google would provide tion to take advantage of new of several “bellwether” cases
At this week’s North Ameri- the autonomous-driving soft- technologies to reach people in this year aimed at setting a
can International Auto Show, ware that governs those func- growing urban centers who pattern for additional settle-
car companies will outline tions, one of these people said. might not own a car. ments among GM and plaintiffs.
plans for autonomous vehicles, Google declined to com- “It used to be years ago peo- A federal judge is oversee-
ride-sharing and electric cars ment. Mr. Fields, when asked Bill Ford has long stressed the need for mobility alternatives. ple were exiting the city and ing so-called multi-district liti-
at a time when 60% of vehicles about whether Ford would going to the suburbs,” Mr. gation that culled together
being sold are light trucks that form a new subsidiary or com- Fields said. “What we’ve seen widespread personal injury,
consume more gasoline.
A primary reason: investors
pany to make strategic invest-
ments in ride-sharing, said,
Ford’s Road Under Bill Ford Jr. over the last decade or so is
the opposite happening, partic-
wrongful death and economic-
loss lawsuits tied to the defec-
have shown little faith in De- “We are open to all possibili- ularly among young people.” tive switch.
troit’s ability to sustain today’s ties.” Ford will roll out alter- 1999—Jacques Nasser becomes CEO, Bill Ford Jr. named chairman Like Mr. Ford, who spent a
profits. Wall Street has driven native-mobility announce- lot of time in Northern Cali-
up valuations of a band of auto-
motive upstarts, including Tesla,
ments in Detroit this week.
These moves could alter the
1999—Ford acquires Sweden’s Volvo Cars for $6.5 billion fornia meeting with tech lead-
ers as an eBay Inc. board Tesla Restricts
while shares of Ford and Gen-
eral Motors Co. have stalled.
direction established when Mr.
Ford took over as CEO in 2001.
2001—Bill Ford Jr. succeeds Jacques Nasser as CEO; keeps
chairman title
member, Mr. Fields is making
monthly trips to Silicon Valley. Its Autopilot
On the surface, investors His company was reeling from a He’s also hired fresh blood. BY MIKE RAMSEY
should be enthusiastic. The tire recall and hemorrhaging 2006—Former Boeing executive Alan Mulally named Ford CEO, Former investment banker and
company is earning record money. Resources were thin af- succeeds Bill Ford Jr. automotive analyst John Casesa, Tesla Motors Inc. imple-
profits in North America, due ter his predecessor, Jacques Nas- and former aerospace executive mented restrictions on where
in part to the success of its new ser, invested in a number of ven- 2008—Ford sells Jaguar and Land Rover to India car maker Tata Ken Washington are heading it will allow its vehicles to use
aluminum-bodied F-150 pickup. tures and luxury brands, so the Motors; sells controlling stake in Mazda Motor Corp. strategy and advanced research autopilot after many owners
Analysts expect 2016 to be an family scion implemented a respectively, for instance. took videos of themselves
even better year for Ford. “back-to-the-basics” approach. 2010—Ford sells Volvo to China’s Zhejiang Geely Holding Group Co. As Mr. Fields expands, how- driving hands-free in danger-
Led by Chief Executive In the years that followed, ever, Ford has learned from its ous situations.
Mark Fields, Ford is now look- Ford dumped a Norwegian 2014—Mark Fields named CEO, replacing Alan Mulally; Ford experience under Mr. Nasser. Tesla, through a software
ing to expand into new trans- electric-vehicle company it introduces new aluminum-bodied F-150 truck Mr. Ford’s engagement, there- update delivered via the Inter-
portation services. Last owned, as well as abandoning Source: the company, staff reports fore, is an important sign that net to its vehicles on Saturday,
month, the executive an- some of Mr. Nasser’s e-com- Mr. Fields’s plan has support. also added a self-parking or
nounced a $4.5 billion electric- merce pursuits and other non- moted to CEO after running “One of the things that Mark “Everybody in management “summon” feature that allows
vehicle plan through 2020, core assets. Mr. Ford hired Ford’s North American opera- and I talked about prior to him understands why we’re doing the owner to park or fetch his
and he has authorized a series Alan Mulally in 2006 to accel- tion for nearly a decade. His becoming CEO was that he this,” Mr. Ford said, referring or her vehicle remotely from a
of experiments that have engi- erate the moves; Mr. Mulally job is to figure out how to di- bought into the notion that to the various new services distance of up to 39 feet.
neers exploring new services, shed a list of luxury brands, versify once again without change is upon us,” Mr. Ford the company is weighing ven- Chief Executive Elon Musk
including car-sharing and test- including Jaguar, Land Rover, straying from Mr. Mulally’s so- said. “If we do this correctly, turing into. “It’s not an add- said during a third-quarter
ing autonomous cars. Aston Martin and Volvo, and called One Ford plan that fo- we can have a very different- on, it’s not something we’re conference call that the com-
Mr. Fields, named CEO in Ford’s controlling stake in cuses on building cars, trucks looking company 10 years from doing on the side.” pany would likely update the
mid-2014, could have an ace Mazda Motor Corp. and SUVs that are safe, smart, now. If we don’t do it correctly, —Alistair Barr software in its autopilot system
up his sleeve. The auto maker Mr. Fields, 54, was pro- green and fun to drive. we will be at best a low-margin contributed to this article. after drivers posted dozens of
videos of themselves doing un-
safe things, such as getting into
Achieving it together
is the real success.
Honda and Acura products are made using domestic and globally sourced parts.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
B6 | Monday, January 11, 2016 THE WALL STREET JOURNAL.
InKoreaProbe
the security of our comput-
ing devices in a misbegot-
ten attempt to stem crimi-
nal behavior or terrorism—
as some in law enforcement
BY DON CLARK pending investigation by the and government suggest we
U.S. Federal Trade Commis- do—then,
Qualcomm Inc. asked a sion and a probe in China we deserve
U.S. federal court to compel completed in 2015. what will
some of its biggest customers One recurring focus is Qual- follow.
and competitors—including comm’s practice of charging It is a
Apple Inc. and Samsung Elec- mobile-phone makers a royalty tempting
tronics Co.—to hand over any based on a percentage of the proposition
documents they provided to wholesale price of their de- KEYWORDS to think
South Korean antitrust au- vices, rather than licensing its that if only
thorities investigating the U.S. technology to other parties CHRISTOPHER companies
chip maker. such as chip makers, who sell MIMS such
The maneuver, which some lower-priced products. Basing as Apple
legal experts called unusual, its royalties on lower-priced Inc., Al-
risks setting off court battles products would reduce Qual- phabet Inc.’s Google
with companies that include comm’s royalty payments. and Microsoft Corp. would
two major purchasers of Qual- Qualcomm’s settlement create so-called backdoors
a second look at China’s high technological firepower such larly and how much traffic ment of its iAd network and
startup valuations. Companies as Huawei Technologies Co., publishers are getting. expects to launch a self-ser-
such as Xiaomi, which raised which overtook Xiaomi as Bob Cohn, chief operating vice ad-buying platform in the
vast sums on China’s mobile- China’s top handset maker in officer at the Atlantic, said the next two months to help in-
Internet boom, now are facing the third quarter 2015, accord- magazine had a good experi- crease ad spending.
growing pressure to live up to ing to Canalys. Huawei, which ence working with Apple, but Despite the setbacks, pub-
expectations. “With China’s sold more than 100 million echoed the concerns about its lishers remain hopeful about
economy slowing, many start- mobile devices last year, is audience and publishers’ abil- the potential of the service and
ups will need to be more cau- beefing up its marketing over- ity to extract advertising reve- Apple’s Eddy Cue said 40 million people have used its News app. say Apple has been responsive
tious in their expansion strate- seas. Huawei’s engineering nues. to their feedback.
gies,” said Nicole Peng, an strength and brand image, “The main thing for us is the traffic we’re seeing so far Publishers have several op- “Provided the product con-
analyst for market-research built up over decades, make it how big of an audience Apple from Apple News, and have tions to distribute their con- tinues to scale, we remain bull-
firm Canalys. difficult for Xiaomi to compete News can generate, and that’s been particularly happy with tent through services such as ish on its potential, and we’re
Xiaomi shot to the top of in China, analysts say. still an open question,” he said. the relationship,” said Julia Facebook’s Instant Articles happy to be part of the early
China’s smartphone market in “The competition in China’s Executives from Apple, in- Beizer, director of product at and Snapchat’s Discover. The wave, even if it means the tool-
2014 with the novel idea of smartphone market has inten- cluding Mr. Cue, met with the Washington Post. draw of these platforms is the set is in the early stages,” Ms.
selling hardware by gathering sified tremendously this year,” publishers late last year to A spokeswoman for The potential to reach a large num- Hansen said.
a large user base, a business said a Xiaomi spokeswoman, discuss the product and ad- Wall Street Journal, which was ber of people on mobile de- “They have been good part-
model usually favored by In- who declined to comment on dress concerns. Mr. Cue said among the publishers that met vices, and media companies ners when we’ve brought is-
ternet companies, not those the company’s valuation or say Apple will continue to spend a with Mr. Cue, declined to com- welcomed Apple’s entry into sues to the table,” Mr. Cohn
selling a physical product. whether it met its 2015 sales lot of time getting feedback ment. The New York Times the mix. said.
Sales that year tripled to 61 target. She said Xiaomi sales from publishers. didn’t return requests for Facebook had its own early —Daisuke Wakabayashi
million smartphones, com- were within expectations. “We have been happy with comment. hiccups working with publish- contributed to this article.
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THE WALL STREET JOURNAL. * * * * * * Monday, January 11, 2016 | B7
MEDIA
‘Revenant,’ ‘Martian’
Take Honors at Globes
‘The Force’ Is With China
Disney’s ‘Star Wars’
BY JOHN JURGENSEN by bringing back three-time
host Ricky Gervais. Armed makes healthy debut
The 73rd annual Golden with a glass of beer, he lobbed in the challenging but
Globe Awards brought some verbal bombs, resulting in
focus to an unpredictable many bleeped words and visi- critical movie market
awards season Sunday night as ble cringes in the audience.
films including “The Reve- In the television categories, BY BEN FRITZ
nant” and “The Martian” were wins by Amazon and USA Net- AND LAURIE BURKITT
honored by the Hollywood For- work highlighted the rapid
eign Press Association. changes in that industry in re- The Force awakened in
“The Revenant,” a raw tale cent years. China this weekend, albeit not
of the American frontier, USA emerged from basic ca- with the Death Star-size start
racked up a trio of top awards, ble’s B-list, having rebranded it enjoyed in the West.
including best motion picture its programming with grittier Walt Disney Co.’s “Star
drama, beating out leading serial dramas. The network’s Wars: The Force Awakens”
contenders such as “Spotlight” stylish hacker thriller “Mr. Ro- grossed an estimated $53 mil-
and “Mad Max: Fury Road.” bot” won best TV series lion in the world’s second-larg-
The film also earned a best-ac- drama. And film veteran Chris- est movie market on Saturday
SPORTS
Heard on Derrick Henry, left, and Alabama
are favored against No.1 Clemson
the Field
JAMIE SQUIRE/GETTY IMAGES
Seahawks Advance on
Wild Playoff Weekend
The two-time reigning NFC
champions survived—barely—to set
up a marquee showdown against
the No. 1 seed Carolina Panthers
next weekend as the Seattle Sea-
hawks beat the Minnesota Vikings
10-9 on Sunday.
The Vikings had seemingly
clinched the game with less than
30 seconds to go, setting up a po-
tential game-winning 27-yard field
goal. But Minnesota kicker Blair
Walsh shanked the kick, sending
the Seahawks to Charlotte for the
divisional round of the playoffs. The
Panthers beat the Seahawks 27-23
in Seattle in October.
Seattle’s win was just one of the
GETTY IMAGES
crazier moments of a wacky wild-
card weekend. The Steelers de-
feated the Bengals in a wild 18-16
game on Saturday night that was
GETTY IMAGES
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Oculus Rift’s
High-Cost Strategy
Stormy markets have cash than they have in years, a that investors spooked by vol- ernment. 110 cents on the dollar
sign of growing stress in fi- atile markets will pull out That money has come from
public pension plans nancial markets. more of their money. stock investors worried about
and mutual funds The ultradefensive stance Large public retirement sys- the end of a long bull run and
100
reflects investors’ skittishness tems and open-end U.S. mutual bond investors nervous about
scurrying for cover about global economic growth funds have yanked nearly $200 rising interest rates and poten-
and uncertain prospects for billion from the market since tially difficult trading condi-
BY TIMOTHY W. MARTIN further gains in assets. Pen- mid-2014, according to a Wall tions exacerbated by bank cap- 90
AND SARAH KROUSE sion funds have the added Street Journal analysis of the ital rules.
need to cut more checks as most recent data available This leaves pension funds
U.S. public pension plans Americans retire in greater from Wilshire Trust Universe with the highest cash levels as a 80
and mutual funds are shelter- numbers, while mutual funds Comparison Service, Morning- percentage of assets since 2004.
ing more of their holdings in want cash to cover the risk star Inc. and the federal gov- Please see CASH page C2
70
2014 ’15 ’16
Judge
CORBIS
Source: FactSet
THE WALL STREET JOURNAL.
funds collectively manage $16 defensive,” said Mr. Clark, who sell in case it needs to meet
trillion, close to the value of reduced holdings in high-yield heavy redemptions.
U.S. gross domestic product, debt and global equities. Gene Tannuzzo, a senior
so even small shifts in their fixed-income portfolio man-
5.4%
holdings can ripple through ager at Columbia Threadnee-
the trading world. dle Investments, said in the
The movement of longer- past two years he has raised
term money to the sidelines Large public pensions funds’ the level of cash in the $2.4
has left the market increas- average cash allocation billion Columbia Strategic In-
ingly in the hands of investors through Sept. 30 come Fund because it has be-
Railroad operator CSX is expected to report quarterly profit of 46 cents a share Tuesday. such as hedge funds, high- come harder to quickly com-
speed traders and exchange- plete certain trades and he
Monday down 15% in billions of cubic feet index Jan., prelim. 92.1 traded funds that buy and sell Pension funds are wrestling wants to avoid being forced to
Refinan., 2 weeks down 117 All items, Nov. up more frequently, potentially with demographic challenges in sell assets to meet potential
Earnings expected* Business
ago 0.3% leaving it more vulnerable to addition to uncertain markets. investor withdrawals. The cash
Estimate/Year Ago($)
down 37% Import price index Dec., exp. down inventories sharp swings, according to Large retirement systems now levels are now a percentage
Alcoa 0.02/0.33 Nov., prev. down Oct., prev. 0.0%
0.2% some money managers. have fewer active workers than point or two above the fund’s
EIA status report 0.4% Core, Nov. up 0.3% Nov., exp. down The shifts have led to retired or inactive members as 3% to 4% average, he said.
Previous change in stocks Dec., exp. down Dec., exp. up 0.1% 0.1% “bouts of rapid buying and Americans age, according to a Still, not all asset managers
Tuesday in millions of barrels 1.6%
Crude oil down 5.1 selling,” said Matthew Peron, Milliman Inc. report from No- are stashing away cash.
Short-selling Empire Earnings expected* managing director for global vember. That means pension of- One of the nation’s largest
reports Gasoline up 10.6 Earnings expected* Manufacturing Estimate/Year Ago($)
equities at Northern Trust, ficials need more money on retirement systems, the
Ratio, days of trading Distillates up 6.3 Estimate/Year Ago($) Citigroup 1.08/0.06
Dec., prev. down 4.6 which oversees more than hand to pay out benefits. Teacher Retirement System of
volume of current Intel 0.63/0.74 Jan., exp. down 4.0 Fastenal 0.40/0.40
position, at Dec 15 Treasury budget
$370 billion. The Pennsylvania State Texas, has just 0.2% of its as-
J.P. Morgan PNC Fin. 1.80/1.84
NYSE 4.3 Rising cash levels are a strong Employees’ Retirement Sys- sets in cash, lower than its tar-
Dec., ‘14 1.29/1.19 Industrial Regions Fin.
Nasdaq 4.5 $2.0 bil surplus
sign of concern about whether tem increased its cash hold- get of 1%, according to public
production 0.20/0.21 financial markets can continue ings to 4.7% of assets through documents. Chief Investment
Earnings expected*
Dec., ‘15, exp. Friday Nov., prev. down U.S. Banc. their advance amid tremors out June 30 as part of an effort to Officer Britt Harris said in an
n.a. 0.6% 0.79/0.79
Estimate/Year Ago($) Retail sales of China and rate increases by keep up with bigger payouts to email that after a decline in
Dec., exp. down Wells Fargo the Federal Reserve. The cash retirees, spokeswoman Pamela high-yield bonds last month,
CSX 0.46/0.49 Nov., prev. up 0.2%
IHS 1.56/1.68
Thursday Dec., exp. 0.0%
0.3% 1.03/1.02 holdings are a potentially bear- Hile said. That was up from the buying opportunities were
Initial jobless ish indicator, but the full impact 3.1% in 2014 and 1.9% in 2013. “the best we’ve seen over the
Capacity utilization
claims Retail sales, ex. Monday, Jan. on the market isn’t clear yet. The system manages money past several years.”
Nov., prev. 77.0%
Wednesday Previous 277,000 autos
Dec., exp. 76.8% 18 Some investors say the cash
Expected 275,000 Nov., prev. up 0.4% piles could be a source of sup-
Mort. bankers
indexes
Dec., exp. up 0.2% U.Mich. consumer
Martin Luther King port if prices fall further, Currencies
EIA report: natural Jr. Day prompting money managers to
Purchase, 2 weeks index U.S.-dollar foreign-exchange rates in late New York trading
gas Producer-price U.S. financial markets are
step in to take advantage.
ago Dec., final 92.6 closed US$vs, US$vs,
Previous change in stocks Managers of some pension Fri YTDchg Fri YTDchg
* FACTSET ESTIMATES EARNINGS-PER-SHARE ESTIMATES DON’T INCLUDE EXTRAORDINARY ITEMS (LOSSES IN PARENTHESES) ADJUSTED FOR plans and mutual funds said Country/currency in US$ per US$ (%) Country/currency in US$ per US$ (%)
STOCK SPLIT NOTE: FORECASTS ARE FROM DOW JONES WEEKLY SURVEY OF ECONOMISTS they limited their losses last Americas Vietnam dong .00004448 22482 1.5
year by moving more of their Argentina peso .0720 13.8858 7.3 Europe
holdings into cash. Returns on Brazil real .2484 4.0260 1.6 Czech Rep. koruna .04043 24.733 –0.6
cashlike securities were basi- Canada dollar .7055 1.4174 2.4 Denmark krone .1464 6.8288 –0.6
cally zero in 2015, while the Chile peso .001375 727.30 2.6 Euro area euro 1.0926 .9153 –0.6
Colombia peso .0003058 3269.60 3.0 Hungary forint .003451 289.77 –0.2
Dow Jones Industrial Average 1 unch
Ecuador US dollar 1 Iceland krona .007727 129.41 –0.6
fell 2.2% and the S&P 500 de- Mexico peso .0558 17.9337 4.3 Norway krone .1129 8.8613 0.2
clined 0.7%. Peru new sol .2919 3.426 0.3 Poland zloty .2502 3.9966 1.9
New York City’s $162 billion Uruguay peso .03283 30.4600 1.8 Russia ruble .01337 74.805 4.0
retirement system has more Venezuela b. fuerte .158595 6.3054 unch Sweden krona .1177 8.4994 0.6
Get instant access to markets data and business news when you’re on EXCLUSIVELY
than tripled its cash holdings Asia-Pacific Switzerland franc 1.0051 .9949 –0.7
the go. With real-time tickers, graphs and news alerts, it’s your instant FOR Turkey lira .3311 3.0206 3.5
on a percentage basis since Australian dollar .6955 1.4378 4.8
markets briefing delivered straight to your iPhone. If it’s worth knowing, SUBSCRIBERS China yuan .1517 6.5934 1.5
Ukraine hryvnia .0430 23.2420 –3.1
mid-2014 to cut the plan’s in- UK pound 1.4518 .6888 1.5
it’s in the What’s News App. terest-rate exposure. As a re- Hong Kong dollar .1288 7.7628 0.2
India rupee .01495 66.881 1.0 Middle East/Africa
sult, New York City’s alloca- Indonesia rupiah .0000718 13931 0.7 Bahrain dinar 2.6558 .3765 –0.1
tions to stocks and fixed- Japan yen .008528 117.26 –2.5 Egypt pound .1277 7.8325 unch
income securities have fallen. Kazakhstan tenge .002910 343.60 1.4 Israel shekel .2547 3.9257 0.9
“These aren’t normal times Macau pataca .1251 7.9963 –0.1 Kuwait dinar 3.2888 .3041 0.2
in the bond market, and our Malaysia ringgit .2262 4.4200 2.7 Oman sul rial 2.5980 .3849 unch
New Zealand dollar .6543 1.5284 4.4 Qatar rial .2746 3.642 unch
cash holdings reflect that,” said Pakistan rupee .00954 104.810 –0.1 Saudi Arabia riyal .2664 3.7536 unch
Scott Evans, investing chief of Philippines peso .0211 47.285 0.9 South Africa rand .0613 16.3161 5.4
the New York City Pension Singapore dollar .6931 1.4427 1.7
Funds, the nation’s fourth-larg- South Korea won .0008267 1209.70 2.9 Close Net Chg % Chg YTD%Chg
est plan by assets. The New Sri Lanka rupee .0069793 143.28 –0.7 WSJ Dollar Index 90.64 0.19 0.21 0.52
York plan has more than $5 bil- Taiwan dollar .02990 33.446 1.6 Sources: Tullett Prebon, WSJ Market Data Group
Thailand baht .02751 36.350 0.9
lion allocated to cash.
REAL-TIME IN NO TIME.
Group Corp., to buy and lease ing how it has become more But those efforts still ha-
back devices like the iPhone that costly for low-rated companies ven’t won over investors. Dar-
Sprint has rented to its custom- to fund themselves. ren Hughes, who helps oversee
ers, raising $1.2 billion. Sprint has been one of the the $1.2 billion Invesco High
Through 2015, junk-rated big losers as the mood has Yield Fund, said Sprint has
companies enjoyed a seven-year shifted. The country’s fourth- taken on too much leverage
boom in which they raised largest wireless company is and that competitors like T-
roughly $1.9 trillion in new carrying $30.9 billion in net Mobile have done a better job
bond sales in the U.S., according debt, $2.3 billion of which of attracting new subscribers.
Download the What’s News App today. to Securities Industry and Fi- comes due this year, according His fund has been trimming
nancial Markets Association to the company’s securities fil- back its exposure, and he said
data. Investors poured into the ings. It burned through more bond buyers will likely be re-
market, hoping to pick up more than $3 billion of cash in the luctant to lend the company
yield as the Federal Reserve first nine months of 2015 and more money.
kept interest rates near zero. was hit with a two-notch “The world’s just had
© 2016 Dow Jones & Co., Inc. All rights reserved. 3DJ2115 The change of heart began a downgrade to B3 by Moody’s enough of Sprint paper,” he
year ago after the rally in oil in September. said. “You can’t really put any
and commodities ran out of The downgrade, losses in more stuffing in the turkey.”
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To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL. * * * * * Monday, January 11, 2016 | C3
GLOBAL FINANCE
Swaps Suit Payout Is Windfall for Funds
Some hedge funds stand to be among the biggest class action. said, adding that the method- known by funds for weeks. admit or deny fault. The pro-
beneficiaries from the suit’s Some funds are only now ology hasn’t been final- Funds that hope to collect cess that moves forward Mon-
and others are in line recent settlement of nearly starting to realize what might ized and is complex. must file claims, which will day will allocate payouts from
to get sums in tens of $1.9 billion, according to pre- be coming to them. It hasn’t Individual payouts from the have to be audited and quali- that suit.
liminary estimates from peo- been clear who was eligible to suit—the aggregate amount is fied by a claims administrator. There are up to 14,000 po-
millions of dollars ple familiar with the case. be a claimant in the class or one of the largest in a private The final settlement of the tential class members who
Each could receive as much when distributions would be antitrust case of its kind—will case must be approved by a could become eligible claim-
BY KATY BURNE as $150 million or more, those made. be a welcome boost for funds court. ants if they traded with the
people said, cautioning that Hedge funds, asset manag- still reeling from rocky mar- A dozen of Wall Street’s defendant banks in the time
Here’s another way some the figures could deviate in ei- ers, pension funds and other kets in 2015. Many fund firms biggest banks agreed last year period of the class, from Janu-
Wall Street debt traders are ther direction. investors involved in the suit have been burned by invest- to settle accusations that they ary 2008 to September 2015,
making money: suing. Whether various funds will are expected to get an early ments in distressed corporate conspired to prevent competi- and meet other criteria. Some
Several hedge funds and receive money, and how much, glimpse of where they bonds and wagers on energy. tion in the credit-derivatives could opt out, for example, if
other big credit investors are is now becoming the talk of the stand on Monday, according Other firms in line for large markets, according to the potential legal and administra-
in line for payouts of tens of town among investors that have to people familiar with the sums include funds affili- complaint. tive fees dwarf their likely
millions of dollars or more, actively traded in credit-default case. ated with Anchorage Capital The suit alleged that the share.
thanks to a lawsuit challeng- swaps, essentially bets on They are to receive access Group LLC, BlackRock Inc., banks overcharged clients and, The plaintiff law firms,
ing how credit deriva- the likely repayment of a bond to a website showing the pro- Bridgewater Associates LP, together with two other insti- Quinn Emanuel Urquhart &
tives were traded in the years or loan. The money is expected posed methodology for divvy- Pacific Investment Manage- tutions, delayed credit deriva- Sullivan LLP and Pearson, Si-
after the financial crisis. to be paid in the second half of ing up the settlement. That ment Co., and Saba Capital tives from being openly traded mon & Warshaw LLP, plan to
BlueCrest Capital Manage- this year, according to the peo- information will help funds to Management LP, the people on exchanges, where prices file with the court for fees of
ment LLP and BlueMountain ple familiar with the case, get a closer idea of their said. would be more transparent. In up to 14% of the total pot,
Capital Management LLC which is being pursued as a payouts, some of the people The exact payouts won’t be settling, the defendants didn’t some people said.
company’s website. “There’s no reason for Chi- Several Asia Pacific curren-
As a result of its invest- nese stocks to move up for cies, including the Australian
ments, combined profit at An- now,” said Jiwu Chen, chief ex- dollar, fell early Monday.
bang’s insurance businesses
has soared to 24.8 billion yuan
in 2014 from 3.75 billion yuan
in 2013.
—Rose Yu, Dinny McMahon
Anbang Insurance has branched out with purchases including the Waldorf Astoria New York hotel. and Yang Jie
Bandeen, 52, has run the stock- Street rose 12% from 2014, while
trading division for more than fixed-income desks suffered a
seven years, a period in which 10% decline, UBS analysts said.
Citigroup has failed to pick up This week, banks will start
much market share against reporting results for the fourth
larger rivals. Over the first three quarter that could show fixed-
quarters of 2015, its ninth-place income revenue declining an ad-
ranking among global invest- ditional 1%, compared with a
ment banks in equities revenue gain of about 3% in equities,
compared with a second-place Turning equities around is a key test for Citi CEO Michael Corbat. UBS projects.
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C4 | Monday, January 11, 2016 THE WALL STREET JOURNAL.
Official to Join TPG the past 52 weeks Dividend yield 2.72 2.45
All-time high 18312.39, 05/19/15
the past 52 weeks Dividend yield 2.26
All-time high:
1.90
2130.82, 05/21/15
BY RICK CAREW thinks it can provide manage- Current divisor 0.14602128057775 65-day moving average
ment expertise, and sees po- 18500 2150
65-day moving average
HONG KONG—Private-eq- tential for high returns. Big
uity giant TPG Capital is hir- multinational lenders like the 18000 2100
ing the former head of the World Bank, Asian Develop-
World Bank’s private-sector ment Bank or the new Beijing-
investment arm to spearhead backed Asian Infrastructure 17500 2050
a new investment push into Investment Bank are often
200-day moving average
developing economies. willing to provide loans for 17000 2000
Jin-Yong Cai, a Chinese deal such projects, but they tend to Week's high
maker and former Goldman shy away from taking owner- 200-day moving average
DOWN UP 16500 1950
Sachs Group Inc. partner who ship stakes or managing the
t
Monday's open Friday's close
most recently headed the In- projects directly.
ternational Finance Corp., will Mr. Cai said that he sees Friday's close Monday's open 16000 1900
t
be in charge of overseeing bil- big investment opportunities
lions of dollars in investments in helping build backbone sys- Week's low
15500 1850
for TPG across Asia and Af- tems like telecommunications
rica, hunting for projects rang- networks or electricity grids Bars measure the point change from Monday's open
ing from warehousing and in Asia and Africa, given the 15000 1800
transport to telecommunica- fast-growing populations in J F M A M J J A S O N D J J F M A M J J A S O N D J
tions and electricity. many countries and the cheap- Primary
The new investment push ness of their currencies, which NYSE weekly volume, in billions of shares market Composite
t
t
reflects the continuing trans- gives more local-currency
Financial Flashback
18
formation of TPG, which like clout for each investment dol- 12 The Wall Street Journal, January 11, 2007
its peers is looking to expand lar. 6 Eastman Kodak Co. agreed to sell its health-imaging
its assets and generate more- “We’re very much trying to 0 group to Onex Corp.’s Onex Healthcare Holdings Inc. for
consistent earnings than its capture the fast-growing mid- J F M A M J J A S O N D J as much as $2.55 billion.
traditional core business of dle class of these economies,” * P/E data based on as-reported earnings from Birinyi Associates Inc.
corporate buyouts typically Mr. Cai said. There hasn’t been
produces. The $70 billion pri- enough investment in “key in- Major U.S. Stock-Market Indexes Nasdaq Composite
vate-equity firm has already frastructure assets for these Latest Week 52-Week Range % chg t 363.78, or -7.26%
been turning itself into a more countries to improve their High Low Close Net chg % chg Low Close (l) High % chg YTD 3-yr. ann. last week
diversified asset manager by productivity.” Dow Jones
making direct loans, investing Nigeria, for instance, has Industrial Average 17405.48 16314.57 16346.45 -1078.58 -6.19 15666.44 l 18312.39 -7.8 -6.2 7.0
in venture-capital deals and invested much less in telecom- Transportation Avg 7491.41 6934.69 6946.36 -562.35 -7.49 6946.36 l 9178.48 -21.6 -7.5 8.1
4900
raising money for hedge funds. munications than China, Mr. Utility Average 582.72 569.12 578.82 1.00 0.17 541.97 l 652.11 -7.2 0.2 8.1
Mr. Cai, 56 years old, will Cai noted, which means mo- Total Stock Market 21026.20 19764.47 19794.61 -1306.33 -6.19 19528.72 l 22287.78 -6.9 -6.2 9.2
be boosting TPG’s efforts in bile data services can still be Barron's 400 508.81 478.06 478.67 -37.79 -7.32 478.67 l 586.75 -10.2 -7.3 8.4 4800
“development capital” invest- very expensive and the coun-
Nasdaq Stock Market
ing, which involves taking try can’t adopt the latest 4700
Nasdaq Composite 4926.73 4637.85 4643.63 -363.78 -7.26 4506.49 l 5218.86 -1.3 -7.3 14.5
stakes in projects where it smartphone technologies.
Nasdaq 100 4522.12 4264.81 4270.78 -322.49 -7.02 4016.32 l 4719.05 1.4 -7.0 16.2
4600
New to the Market Standard & Poor's 1 4 5 6 7 8
500 Index 2038.20 1918.46 1922.03 -121.91 -5.96 1867.61 l 2130.82 -6.0 -6.0 9.7 January
Public Offerings of Stock MidCap 400 1392.87 1307.30 1308.48 -90.10 -6.44 1308.48 l 1549.44 -9.2 -6.4 7.6 DJ US TSM
SmallCap 600 667.81 622.72 623.42 -48.32 -7.19 623.42 l 742.13 -8.4 -7.2 8.4 t 1306.32, or -6.19%
IPOs in the U.S. Market Other Indexes last week
Initial public offerings of stock expected this week; might include some Russell 2000 1134.08 1045.11 1046.20 -89.69 -7.90 1046.20 l 1295.8 -11.8 -7.9 6.1
offerings, U.S. and foreign, open to institutional investors only via the NYSE Composite 10039.96 9513.25 9528.77 -614.65 -6.06 9528.77 l 11239.66 -11.0 -6.1 3.5
Rule 144a market; deal amounts are for the U.S. market only Value Line 445.80 413.07 413.50 -32.30 -7.25 413.50 l 522.42 -16.3 -7.2 3.1 20720
Symbol/ Pricing NYSE Arca Biotech 3751.31 3430.70 3437.10 -376.86 -9.88 3303.47 l 4431.87 -2.9 -9.9 28.5
Expected primary Shares Range($)
pricing date Filed Issuer/business exchange (mil.) Low/High Bookrunner(s) NYSE Arca Pharma 538.49 512.31 513.38 -28.05 -5.18 509.74 l 605.94 -5.9 -5.2 10.5 20380
KBW Bank 72.35 66.28 66.40 -6.69 -9.15 66.40 l 80.41 -5.4 -9.1 7.6
1/14 11/4 Shimmick Construction Co SCCI 6.3 11.00/ FBR Cptl Mrkts
2015 Construction company Nq 13.00 PHLX§ Gold/Silver 48.98 45.54 47.10 1.80 3.98 43.21 l 82.07 -38.2 4.0 -33.6
20040
offering general PHLX§ Oil Service 159.95 141.19 142.20 -15.53 -9.84 142.20 l 224.32 -28.4 -9.8 -14.7
construction, construction
management, and design- PHLX§ Semiconductor 658.75 599.87 600.48 -63.00 -9.50 559.59 l 746.08 -12.4 -9.5 15.3
build services. CBOE Volatility 27.08 19.25 27.01 8.80 48.33 11.95 l 40.74 53.9 48.3 25.6 19700
1 4 5 6 7 8
Philadelphia Stock Exchange Sources: SIX Financial Information; WSJ Market Data Group January
Lockup Expirations
Below, companies whose officers and other insiders will become eligible
to sell shares in their newly public companies for the first time. Such International Stock Indexes Commodities and
sales can move the stock’s price. Latest Week 52-Week Range YTD Currencies
Region/Country Index Close % chg Low Close High % chg Last Week YTD
Lockup Offer Offer amt Through Lockup Close Net chg %Chg % chg
expiration Issue date Issuer Symbol price($) ($ mil.) Friday (%) provision World The Global Dow 2189.48 –6.29 2189.48 • 2639.52 –6.3
Jan. 11 July 15, ’15 Chiasma Inc CHMA 16.00 117.1 –3.4 180 days DJ Global Index 289.19 –6.10 288.56 • 341.62 –6.1 DJ Commodity 443.32 -10.48 -2.31 -2.31
July 15, ’15 Jupai Holdings Ltd JP 10.00 53.0 –11.9 180 days DJ Global ex U.S. 197.37 –6.11 197.37 • 246.68 –6.1 Reuters-Jefferies CRB 168.58 -7.69 -4.36 -4.36
July 15, ’15 Ollie's Bargain Outlet Holdings OLLI 16.00 164.2 13.5 180 days
Global Dow Euro 1890.43 –6.66 1846.63 • 2305.98 –6.7 Crude oil, $ per barrel 33.16 -3.88 -10.48 -10.48
July 15, ’15 ProNAi Therapeutics Inc DNAI 17.00 158.4 –28.9 180 days
DJ TSM Global 2973.46 –6.12 2969.78 • 3510.20 –6.1 Natural gas, $/MMBtu 2.472 0.135 5.78 5.78
Jan. 12 July 16, ’15 MCBC Holdings Inc MCFT 15.00 104.7 –16.5 180 days
Global ex U.S. 1994.33 –6.05 1994.33 • 2482.77 –6.0 Gold, $ per troy oz. 1097.80 37.50 3.54 3.54
–52.2
Developed ex U.S. 1982.88 –5.90 1982.88 • 2403.18 –5.9
U.S. Dollar Index 98.38 -0.32 -0.32 -0.32
July 16, ’15 Ooma Inc OOMA 13.00 65.0 180 days Global Small-Cap 3955.94 –6.15 3955.94 • 4716.91 –6.1
WSJ Dollar Index 90.64 0.45 0.50 0.52
July 16, ’15 Rapid7 Inc RPD 16.00 118.7 –11.0 180 days Global Large-Cap 2830.72 –6.11 2821.87 • 3337.56 –6.1
Euro, per dollar 0.9153 -0.0055 -0.59 -0.59
Jan. 17 July 21, ’15 Blue Buffalo Pet Products BUFF 20.00 778.1 –16.0 180 days Americas DJ Americas 457.28 –6.15 454.62 • 524.44 –6.1
Yen, per dollar 117.26 -3.40 -2.81 -2.52
Sources: Dealogic; WSJ Market Data Group Brazil Sao Paulo Bovespa 40612.21 –6.32 40612.21 • 58051.61 –6.3
U.K. pound, in dollars 1.45 -0.03 -1.75 -1.48
Canada S&P/TSX Comp 12445.45 –4.34 12445.45 • 15450.87 –4.3
IPO Scorecard Mexico IPC All-Share 40265.37 –6.31 40265.37 • 45773.31 –6.3 52-Week Range
Performance of IPOs, most-recent listed first Chile Santiago IPSA 2843.48 –3.41 2826.03 • 3359.04 –3.4
Low Close(l) High % Chg
% Chg From % Chg From Europe Stoxx Europe 600 341.35 –6.69 337.93 • 414.06 –6.7 DJ Commodity 441.41 l 584.70 -20.03
Company SYMBOL
IPO date/Offer price
Friday3s Offer 1st-day
close ($) price close
Company SYMBOL
IPO date/Offer price
Friday3s Offer 1st-day
close ($) price close
Stoxx Europe 50 2887.84 –6.85 2887.84 • 3591.47 –6.9 Reuters-Jefferies CRB 168.54 l 231.77 -25.27
Prothena
Healthcare
Jan. 7
April 6,315
$119.3 ... RBC Cptl Mkts,
UBS, Barclays
Consumer Rates and Returns to Investor Benchmark Yields and Rates
Ardelyx Jan. 7 $75.0 $200.0 Citi, Leerink Prtnrs U.S. consumer rates Selected rates Treasury yield curve Forex Race
Healthcare July 13,315
A consumer rate against its New car loan Yield to maturity of current bills, Yen, euro vs. dollar; dollar vs.
Galena Biopharma Jan. 7 $21.8 $100.0 Raymond James benchmark over the past year notes and bonds major U.S. trading partners
Healthcare Dec. 4,315
Bankrate.com avg†: 3.16%
Lake Elmo Bank 1.99% 5.00% 15%
pSivida Jan. 7 $16.0 $75.0 Ladenburg Thalmann, Prime rate 3.50% Lake Elmo, MN 651-777-8365 10 WSJ Dollar index
Healthcare Nov. 19,315 Northland Securities t 4.00 s
PNC Bank 1.99% 5
Acadia Healthcare Jan. 6 $610.0 ... BofA ML, Jefferies 3.00
Atlantic City, NJ 856-464-1394 3.00 0
Healthcare June 9,314
s
t
2.50 Think Mutual Bank 1.99% –5
Acadia Pharmaceuticals Jan. 6 $300.0 ... BofA ML, JPM New car loan 2.00 Yen
Rochester, MN 800-288-3425
Healthcare March 3,314 –10 s
2.00 2.12% Friday 1.00
t
Albany, NY 518-436-9043
Healthcare Jan. 5,316 1.50 0.00 –20
F M A M J J A S O N DJ Chase Bank 2.16% 1 3 6 1 2 3 5 710 30
TherapeuticsMD Jan. 6 $143.8 $250.0 GS, Cowen & Co 2015
2015 Baton Rouge, LA 800-CHA-SE24 month(s) years
Healthcare Nov. 5,315
Yield/Rate (%) 52-Week Range (%) 3-yr chg maturity
Epizyme Jan. 6 $120.0 $250.0 Citi, Leerink Prtnrs,
Healthcare May 4,315 RBC Cptl Mkts Interest rate Last (l)Week ago Low 0 2 4 6 8 High (pct pts) Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group
CLOSED-END FUNDS
wsj.com/funds
Listed are the 300 largest closed-end funds as 52 wk Prem12 Mo 52 wk 52 wk Prem12 Mo
measured by assets. Prem Ttl Fund (SYM) NAV Close /Disc Yld Fund (SYM) NAV Close /Disc Yld
Closed-end funds sell a limited number of shares and Prem Ttl Prem Ttl
Fund (SYM) NAV Close /Disc Ret Fund (SYM) NAV Close /Disc Ret Fund (SYM) NAV Close /Disc Ret
invest the proceeds in securities. Unlike open-end MFS Inc Tr MIN 4.97 4.59 -7.6 10.0 Voya Senior Income:B 12.13 NA NA 5.1
funds, closed-ends generally do not buy their shares GoldmanSachsMLPIncOpp GMZ 7.81 NA -52.8 WstAstClymr InfLnkd Fd WIW 12.22 10.34 -15.4 3.5 Resource RE Div Inc:D 9.70 NA NA NS World Equity Funds Voya Senior Income:C 12.15 NA NA 5.1
back from investors who wish to cash in their holdings.
Instead, fund shares trade on a stock exchange.
Goldman Sachs MLPEnergy GER 5.16 4.93 -4.5 -62.2 WstAssetClymr InflLnk Sec WIA 12.52 10.62 -15.2 3.3 Resource RE Div Inc:I 10.07 NA NA -2.8 BMO LGM Front ME 7.90 NA NA -11.5 Voya Senior Income:I 12.14 NA NA 5.9
a-The NAV and market price are ex dividend. b-The John Hancock Finl Opps Fd BTO 24.42 25.04 +2.5 18.4 Loan Participation Funds Resource RE Div Inc:T 9.54 NA NA NS Voya Senior Income:W 12.18 NA NA 5.9
Prem12 Mo
NAV is fully diluted. c-NAV is as of Thursday’s close. d- KayneAndersonEngyTRFd KYE 8.28 7.66 -7.5 -67.6 Apollo Sr Fltg Rate Fd AFT 16.92 14.97 -11.5 7.7 Resource RE Div Inc:U 9.55 NA NA NS Fund (SYM) NAV Close /Disc Yld High Yield Bond Funds
NAV is as of Wednesday’s close. e-NAV assumes rights
offering is fully subscribed. f-Rights offering in process. Kayne Anderson MLP Invt KYN 15.32 15.00 -2.1 -52.1 BlackRock FR Incm Strat FRA 14.27 12.83 -10.1 6.1 Resource RE Div Inc:W 9.69 NA NA -3.1 WA Middle Mkt Inc WMF NA NA NA 13.1
Kayne Andrsn Midstr Engy KMF 10.92 10.71 -1.9 -61.5 Blkrk FltRt InTr BGT 13.78 12.29 -10.8 6.0 U.S. Mortgage Bond Funds
g-Rights offering announced. h-Lipper data has been SharesPost 100 25.33 NA NA 1.6 Other Domestic Taxable Bond Funds
adjusted for rights offering. j-Rights offering has Macquarie Glbl Infrstrctr MGU 21.24 17.80 -16.2 -22.0 BlackstoneGSO Strat Cred BGB NA 13.52 NA 9.4 Versus Cap MMgr RE Inc:F 26.86 NA NA 6.6 Vertical Capital Income 11.85 NA NA 3.5 Capstone Church Capital 16.96 NA NA 1.7
expired, but Lipper data not yet adjusted. l-NAV as of Loan Participation Funds
previous day. o-Tender offer in process. v-NAV is NeubergerBermanMLPIncm NML 7.20 7.47 +3.8 -54.8 Blackstone GSO Sr Float BSL 15.90 14.74 -7.3 7.2 Versus Cap MMgr RE Inc:I 26.92 NA NA 7.1 GL Beyond Income 4.94 NA NA NE
converted at the commercial Rand rate. w-Convertible Neubrgr Brm Rl Est Sec Fd NRO 5.52 4.88 -11.6 -3.0 Eaton Vance FR Incm Tr EFT 13.97 12.44 -11.0 7.1 Income Preferred Stock Funds 504 Fund 10.00 NA NA 3.0 Palmer Square Opp Income NA NA NA 5.4
Note-NAV (not market) conversion value. y-NAV and
Nuveen Dow 30 Dynamic DIAX 14.90 13.33 -10.5 NA EatonVnc SrFltRate EFR 13.57 12.26 -9.7 7.5 CLA Strategic Alloc XSAFX 2.54 NA NA NS Invesco Sr Loan A 6.04 NA NA 6.1 Resource Credit Inc:A 9.76 NA NA NS
market price are in Canadian dollars. NA signifies that
the information is not available or not applicable. NS NuvDivInco JDD 12.11 10.47 -13.5 -3.3 1st Tr Sr Fltg Rt Fd II FCT 13.51 12.11 -10.4 7.1 MultiStrat Gro & Inc:A 15.38 NA NA -2.8 Invesco Sr Loan B 6.04 NA NA 6.1 Resource Credit Inc:C 9.75 NA NA NS
signifies fund not in existence of entire period. Nuveen Engy MLP Fd JMF 10.91 10.06 -7.8 -43.5 Invesco Credit Opps Fund VTA 12.05 10.53 -12.6 8.5 MultiStrat Gro & Inc:C 15.26 NA NA -3.5 Invesco Sr Loan C 6.05 NA NA 5.3 Resource Credit Inc:D 9.76 NA NA NS
12 month yield is computed by dividing income Invesco Sr Loan IB 6.04 NA NA 6.4
dividends paid (during the previous twelve months for NuvNASDAQ100DynOver QQQX 18.69 NA NA NA Invesco Senior Income Tr VVR 4.48 4.03 -10.0 7.9 MultiStrat Gro & Inc:I 15.42 NA NA -2.5 Resource Credit Inc:I 9.77 NA NA NS
periods ending at month-end or during the previous Nuveen Real Estate Fd JRS 11.48 10.50 -8.5 -3.7 Nuveen Credit Strt Inc Fd JQC 8.91 7.75 -13.0 7.5 MultiStrat Gro & Inc:L 15.30 NA NA -3.3 Invesco Sr Loan IC 6.04 NA NA 6.2 Resource Credit Inc:T 9.75 NA NA NS
fifty-two weeks for periods ending at any time other
NuveenS&P500Buy-Write BXMX 12.76 12.67 -0.7 NA NuvFloatRteInco Fd JFR 10.83 10.04 -7.3 7.0 Convertible Sec's. Funds Invesco Sr Loan Y 6.04 NA NA 6.4 Resource Credit Inc:U 9.77 NA NA NS
than month-end) by the latest month-end market price
adjusted for capital gains distributions. Reaves Utility Fund UTG 25.72 NA -15.3 Nuv Float Rte Opp Fd JRO 10.79 9.70 -10.1 7.7 Calmos Dyn Conv and Inc CCD 19.56 17.59 -10.1 NS Voya Senior Income:A 12.17 NA NA 5.6 Resource Credit Inc:W 9.76 NA NA NS
Source: Lipper Tekla Hlthcr Investors HQH 28.06 27.34 -2.6 -6.1 Nuveen Senior Income Fund NSL 6.45 5.71 -11.5 7.2
Friday, January 8, 2016 Tekla Healthcare Opps Fd THQ 18.19 16.41 -9.8 -10.9 Pioneer Floating Rate Tr PHD 12.03 10.68 -11.2 6.5
52 wk Tekla Life Sciences HQL 21.80 21.44 -1.7 -7.7 Voya Prime Rate Trust PPR 5.48 4.93 -10.0 6.6
Prem Ttl Tekla World Hlthcr Fd THW 17.27 15.02 -13.0 NS High Yield Bond Funds ADVERTISEMENT
Fund (SYM) NAV Close /Disc Ret Tortoise Energy TYG 25.79 25.12 -2.6 -37.2 AllianceBernstein Glbl AWF 12.26 10.99 -10.4 10.2
General Equity Funds
Adams Divers Equity Fd ADX 14.13 12.06 -14.6 -5.3
Boulder Grwth & Inco BIF 7.35 NA -15.3
Tortoise MLP Fund NTG 16.87 15.42 -8.6 -37.3
Voya Gl Equity Div IGD 7.57 6.62 -12.5 -10.4
Income Preferred Stock Funds
Babson Gl Sh Dur Hi Yd BGH 18.33 16.37 -10.7 12.0
BlackRock Corp Hi Yd Fd HYT 10.84 9.82 -9.4 10.1
BlkRk Debt Strat Fd DSU 3.84 3.30 -14.1 8.0
BlackRockDurInco Tr BLW 16.14 14.35 -11.1 8.2
Legal Notices
To advertise: 800-366-3975 or WSJ.com/classifieds
Central Securities CET 22.24 17.89 -19.6 -8.6 Calamos Strat Fd CSQ 10.37 9.12 -12.1 -11.3
CohSteer Opprtnty Fd FOF 11.96 10.63 -11.1 -10.8 Cohen & Steers Dur Pfd LDP 25.29 22.67 -10.4 4.8 Credit Suisse High Yld DHY 2.40 2.23 -7.1 12.6
Cornerstone Strategic CLM 14.29 15.38 +7.6 -5.8 Cohen & Strs Sel Prf Inco PSF 26.83 25.21 -6.0 5.5 DoubleLine Incm Solutions DSL NA 16.52 NA 11.6
EtnVnc TaxAdvDiv EVT 20.23 18.29 -9.6 -3.3 FT Interm Duration Pfd FPF 23.35 21.42 -8.3 5.4 Dreyfus Hi Yld Fd DHF 3.20 3.05 -4.7 11.3 CLASS ACTIONS
Gabelli Dividend & Incm GDV 19.49 17.00 -12.8 -14.3 Flaherty & Crumrine Dyn DFP 24.28 23.25 -4.2 9.3 Fst Tr Hi Inc Lg/Shrt Fd FSD 16.27 13.90 -14.6 8.8
Gabelli Equity GAB 5.30 4.92 -7.2 -14.8 Flaherty & Crumrine Pfd FFC 18.89 19.78 +4.7 5.6 Guggenheim Strat Opps Fd GOF 17.48 16.60 -5.0 12.9
Genl American Investors GAM 35.05 29.37 -16.2 -10.7 John Hancock Pfd Income HPI 21.88 20.31 -7.2 4.4 Ivy High Income Opps Fund IVH 14.14 12.04 -14.9 12.9
HnckJohn TxAdv HTD 22.81 20.04 -12.1 -3.0 John Hancock Pfd II HPF 21.65 20.02 -7.5 2.9 NexPoint Credit Strat Fd NHF 23.28 19.51 -16.2 32.2
Nuveen Gl Hi Incm Fd JGH 15.90 13.67 -14.0 11.4
Liberty All-Star Equity USA 5.76 4.90 -14.9 -9.2
Royce Micro-Cap RMT 7.97 6.86 -13.9 -16.8
John Hancock Pfd Inc III HPS 19.20 18.18 -5.3 6.6
JHancock Pr Div PDT 14.94 13.40 -10.3 4.1 Nuveen High Incm Dec18 JHA 9.59 10.02 +4.5 NS
!
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Royce Value Trust RVT 12.57 10.74 -14.6 -15.6 LMP Cap & Inco Fd SCD 13.85 11.68 -15.7 -24.1 Pioneer High Income Trust PHT 9.38 9.57 +2.0 14.5
Source Capital SOR 71.49 64.09 -10.4 -0.9 Nuveen Preferred & Incm JPI 24.49 23.58 -3.7 12.3 Prud Gl Shrt Dur Hi Yd GHY 16.00 14.22 -11.1 10.0
Tri-Continental TY 22.40 19.07 -14.9 -6.6 Nuveen Preferred Inc Opp JPC 10.22 9.48 -7.2 7.7 Prudentl Sh Dur Hi Yd Fd ISD 16.33 14.96 -8.4 9.6
Wells Fargo Incm Opps Fd EAD 8.22 7.41 -9.9 10.9
Zweig Fund ZF 13.73 12.28 -10.6 -13.1 Nuveen Quality pf JTP 9.02 8.23 -8.8 5.8
Specialized Equity Funds Nuveen Fd2 JPS 9.62 9.03 -6.1 5.9 Wstrn Asset Glbl Hi Inco EHI 10.15 8.64 -14.9 13.2
!
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Adams Natural Rscs Fd PEO 19.24 16.30 -15.3 -26.0 TCW Strategic Income Fund TSI 5.38 NA 2.2 Wstrn Asset High Inco II HIX 6.87 6.39 -7.0 13.1
!
AllnzGI NFJ Div Interest NFJ 13.57 11.64 -14.2 -19.6 Zweig Total Return ZTR 12.95 11.84 -8.6 -7.6 Wstrn Asset Opp Fd HIO 5.15 4.59 -10.9 9.0
!
AlpnGlblPrProp AWP 6.51 5.50 -15.5 -11.8 West Asst HY Def Opp Fd HYI 15.35 13.99 -8.9 9.3
Convertible Sec's. Funds
Other Domestic Taxable Bond Funds
%
!
!
BlkRk Enh Cap Inco CII 14.22 13.37 -6.0 1.7 AdvntClymrFd AVK 15.48 13.21 -14.7 -13.2
BlkRk Engy Res Tr BGR 12.96 11.69 -9.8 -38.1 Ares Dynamic Credit Alloc ARDC NA 13.34 NA 10.5
&
AllianzGI Conv & Incm NCV 6.10 5.48 -10.2 -31.6
BlackRock Enh Eq Div Tr BDJ 8.23 7.23 -12.2 -5.6 AllianzGI Conv & Incm II NCZ 5.42 4.81 -11.3 -35.6 Babson Cap Corp Inv MCI NA 17.19 NA 6.9
!
Blackrock Global Trust BOE 13.39 12.09 -9.7 -0.1 AllianzGI Equity & Conv NIE 19.84 17.13 -13.7 -8.8 BlackRock Multi-Sector IT BIT 18.18 15.79 -13.1 9.4
"
BlkRk Health Sci BME 33.98 38.51 +13.3 8.3 Calamos Conv Hi Inco Fd CHY 11.14 10.07 -9.6 -19.2 BlackRock Taxable Mun Bd BBN 22.64 21.71 -4.1 7.5
BlkRk Intl Grwth&Inco BGY 6.55 5.97 -8.9 -3.4 Calamos CHI 10.51 9.47 -9.9 -17.8 Doubleline Oppor Credit DBL NA 25.43 NA 10.0
BlackRck Rscs Comm Str Tr BCX 7.72 6.52 -15.5 -26.8 World Equity Funds Duff & Phelps Utl & Cp Bd DUC 10.11 9.22 -8.8 6.5 $
+
BlackRock Science & Tech BST 18.40 16.25 -11.7 -4.3 EtnVncLtdFd EVV NA 12.62 NA 9.5
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ClearBridge Amer Engy CBA 7.77 7.26 -6.6 -50.1 MFS Multimkt MMT 6.46 5.58 -13.6 9.0 #,& ,
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Clough Global Opp Fd GLO 11.88 10.04 -15.5 -10.9
ClearBridge Engy MLP Fd CEM 14.36 13.19 -8.1 -45.6 Nuveen Build Am Bd Fd NBB 21.58 20.35 -5.7 6.7 /' '
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EtnVncTxAdvGblDiv ETG 15.92 14.67 -7.9 -1.4
PIMCO Corporate & Incm PTY NA 13.27 NA 11.9 +
-
Clearbridge Engy MLP Opp EMO 12.36 11.32 -8.4 -44.3 EatonVance TxAdv Opport ETO 21.51 20.32 -5.5 -5.8 1)-
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Clearbridge Engy MLP TR CTR 11.53 10.70 -7.2 -43.7 PIMCO Corporate & Incm PCN NA 13.45 NA 10.2
First Trust Dynamic Eur FDEU 17.76 16.25 -8.5 NS
PIMCO HiInco PHK NA 8.11 NA 16.9 **& 2 '
)*
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Cohen & Steers Infra UTF 21.24 17.77 -16.3 -13.9 Gabelli Glbl Multimedia GGT 7.86 7.10 -9.7 -18.9
C&S MLP Incm & Engy Opp MIE 9.49 9.38 -1.2 -46.3 PIMCO Inco Str Fd PFL NA 9.53 NA 11.0
("3"& 0' #,
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GDL Fund GDL 11.78 10.03 -14.9 4.9
Cohen & Steers Qual Inc RQI 13.06 11.64 -10.9 1.6 India Fund IFN 24.63 21.38 -13.2 -13.2
Pimco Inco Strat Fd II PFN NA 8.66 NA 11.7
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CohnStrsPfdInco RNP 21.29 17.89 -16.0 -0.6 Putnam Mas Inco PIM 4.92 4.42 -10.2 6.8
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Japan Sml Cap JOF 11.23 10.02 -10.8 22.5
Putnam Premier Income Tr PPT 5.41 4.83 -10.7 6.3 "#
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Cohen & Steers TR RFI 13.27 12.06 -9.1 -2.6 Mexico Fund MXF 15.42 NA -19.3 /
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CLSeligmn Prem Tech Gr Fd STK 15.76 16.10 +2.2 -4.0 Wells Fargo Multi-Sector ERC 13.07 11.44 -12.5 10.2
MS China a Shr Fd CAF 21.29 16.80 -21.1 -11.8
World Income Funds
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Divers Real Asset Incm Fd DRA 17.56 15.17 -13.6 -4.7 28.02 24.07 -14.1 -10.7
MS India Invest IIF
Abeerden Asia-Pacific FAX 5.41 4.47 -17.4 6.4
" $
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Duff & Phelps DNP 8.01 9.08 +13.4 -3.8 New Germany Fund GF 15.15 13.53 -10.7 5.7
Duff&PhelpsGblUtilIncFd DPG 16.29 13.78 -15.4 -27.9 Etn Vnc Short Dur Fd EVG 14.98 13.19 -11.9 8.0
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Swiss Helvetia Fund SWZ 11.64 10.06 -13.6 -3.3
Eaton Vance Eqty Inco Fd EOI 13.20 12.50 -5.3 -0.4 Templeton Dragon TDF 18.81 NA NA NA
Legg Mason BW Glbl Incm BWG 13.34 11.29 -15.4 16.4
4
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Eaton Vance Eqty Inco II EOS 13.46 12.85 -4.5 2.0 MS EmMktDomDebt EDD 8.00 6.66 -16.8 12.6 45 0""" 6 4
Voya Infr Indls & Matls IDE 13.47 11.49 -14.7 -17.8 PIMCO Dynamic Credit Incm PCI NA 17.95 NA 11.8
EtnVncRskMngd ETJ 10.72 9.70 -9.5 -1.7 Wells Fargo Gl Div Opp EOD 6.62 5.61 -15.3 -17.7 PIMCODynamicIncomeFund PDI NA 27.69 NA 14.5
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Etn Vnc Tax Mgd Buy-Write ETB 14.67 15.64 +6.6 5.7
Eaton Vance BuyWrite Opp ETV 13.73 14.28 +4.0 8.8
Prem12 Mo PIMCO Income Opportunity PKO NA 20.93 NA 10.5 $ $ ,$ ##./
Eaton Vance Tax-Mng Div ETY 11.21 10.58 -5.6 2.5
Fund (SYM) NAV Close /Disc Yld PIMCO Strat Income Fund RCS NA 8.99 NA 11.1
" $
U.S. Mortgage Bond Funds Templeton Emerging TEI 11.34 9.76 -13.9 8.0
7
+
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EatonVanceTax-MngdOpp ETW 10.90 10.60 -2.8 3.2
EtnVncTxMngGlDvEqInc EXG 9.15 8.49 -7.2 -0.6 BlackRock Income Trust BKT 6.98 6.45 -7.6 5.8 Templeton Global GIM 7.05 6.21 -11.9 4.7
" $
Fiduciary/Clymr Opp Fd FMO 13.00 12.06 -7.2 -47.4 Brkfld Mortgage Opp Incm BOI 16.97 14.53 -14.4 10.3 Wstrn Asset Emerg Mkts ESD 16.25 13.62 -16.2 9.5
2
FT Energy Inc & Growth Fd FEN 22.50 22.13 -1.6 -32.6 Brookfield TR Fund HTR 21.77 NA 10.3 Wstrn Asset Emerg Mkt II EMD 11.58 9.61 -17.0 8.8 ) !
Wstrn Asset Gl Def Opp Fd GDO 17.96 15.89 -11.5 8.6
" $
FstTrEnhEqtIncFd FFA 14.06 12.37 -12.0 -8.6 Nuveen Mtg Oppy Term Fd JLS 25.05 22.76 -9.1 6.6
Investment Grade Bond Funds National Muni Bond Funds
"
First Tr Engy Infr Fd FIF 15.66 13.42 -14.3 -34.9 "#
"" +
AllianceBrnstn IncoFd ACG 7.88 7.67 -2.7 6.0 AllianceBrnstn NtlMun AFB 15.34 13.93 -9.2 5.8
First Tr MLP & Engy Incm FEI 13.36 12.00 -10.2 -35.5
Blackrock Invest BKN 16.56 15.59 -5.9 5.9
"
Gabelli Hlthcr & Well GRX 11.17 9.74 -12.8 -2.1 Blackrock Core Bond Tr BHK 13.98 12.72 -9.0 7.0
Gabelli Utility Tr GUT 5.03 5.71 +13.5 -13.2 BlkRk Credit Alloc Incm BTZ 13.81 12.38 -10.4 7.8 BlackRock Municipal Trust BFK 15.11 14.93 -1.2 6.1 = ?D ?<4:"
GAMCOGlblGoldNatRscs&Inc GGN 5.30 5.03 -5.1 -20.4 John Hancock Income Secs JHS 14.72 13.46 -8.6 6.5 BlackRockMuni BLE 15.73 15.45 -1.8 6.1 849:;:5<<<<
=
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BlackRockMuni Tr BYM 15.78 14.78 -6.3 5.7
( >
7
Blackrock Mun Target Term BTT 24.20 22.09 -8.7 4.4 > %
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BlkRk MuniAssets Fd MUA 14.31 14.40 +0.6 5.2
F
New to the Market BlkRk Munienhanced MEN 12.47 12.11 -2.9 6.1
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BlkRk MuniHldgs Inv MFL 15.64 14.82 -5.2 5.9
BlkRk MuniHldgs Qlty II MUE 14.85 13.73 -7.5 6.0
Public and Private Borrowing BlkRk MuniVest MVF 10.26 10.46 +1.9 6.2
" " $
BlkRk MuniVest II MVT 16.16 16.55 +2.4 6.0 7
= ?D ?<4:"
Treasurys BlkRk MuniYield MYD 15.52 15.06 -3.0 6.2 )*+ $ ,#- ,$ ##./
BlkRk MuniYld Quality MQY 16.41 16.06 -2.1 6.0 +
7
!
Monday, January 11 Thursday, January 14 BlkRk MuniYld Qlty II MQT 14.38 13.53 -5.9 6.2 7
BlRkMunyldQltyIII MYI 15.17 14.91 -1.7 6.0
)
Auction of 13-week bills; Auction of 30-year bonds; "#
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Invesco Inv Grade Muni VGM 14.72 13.49 -8.4 6.6 & )
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Nuveen Muni Mkt Opp NMO 15.65 13.99 -10.6 5.6
City-Florida Nabors Giblin Nuveen Mun Opportunity Fd NIO 15.99 14.54 -9.1 6.1
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Nuveen Performance Plus NPP 16.57 15.19 -8.3 5.9
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HEARD ON THE STREET FINANCIAL ANALYSIS & COMMENTARY WSJ.com/Heard
Biotech Is
Bloodied,
Oculus Rift: The Price of a Sharper Vision
Virtual reality could cause perception of virtual reality. sles. Ben Schachter of Mac-
Vision Quest
But Not Out a case of real-world sticker
shock. For those with the
stomach to take a long-term
Projected installed
The importance of that goes
well beyond gaming.
Although seen as a nerd’s
quarie Capital describes this
formula as “utility > distur-
bance.” He thinks the Oculus
base for Oculus Rift
Biotech stocks had a par- view of the business, though, toy for now, VR could even- Rift has achieved enough of
ticularly rough start to 2016. that isn’t a bad thing. 6 million units tually disrupt areas such as that balance to ship about
But the coming week will be As last week’s Consumer communications, retail shop- one million units this year.
a far more informative gauge Electronics Show proved, ping—both online as it now Others have guessed lower.
of the sector’s health. virtual reality is the hot new 4 exists and in bricks-and-mor- But most analysts agree that
The Nasdaq Biotechnology thing in tech. Hundreds of tar stores—and services such the Rift isn’t a mass-market
Index is off 11% to start the attendees waited in long as real estate, to name a few. device at its current price.
pursue cases where we can more money for investors, ac- weak cases something of a pet level Oct. '15 Nov. '14 Switzerland 0.50 0.50 0.50 0.50 Treasury bill auction
make a difference for stockhold- cording to Cornerstone Re- issue. But “this time feels differ- Britain 0.50 0.50 0.50 0.50
U.S. consumer price index 4 weeks 0.200 0.170 0.235 0.000
Australia 2.00 2.00 2.50 2.00
ers.” search. ent,” said Ed Micheletti of Skad- All items 237.336 –0.21 0.5 13 weeks 0.215 0.260 0.280 0.000
Shareholder lawsuits have Delaware judges have be- den, Arps, Slate, Meagher & Core 244.075 0.04 2.0 Overnight repurchase 26 weeks 0.500 0.550 0.585 0.065
proliferated in recent years, typ- come increasingly critical of Flom LLP, in part because Judge U.S. 0.47 0.38 0.48 0.07
International rates Secondary market
ically charging that companies these “disclosure only” pacts, Laster’s colleagues are joining
U.S. government rates Fannie Mae
did a bad job shopping them- which they say do shareholders him. Week 52-Week
Latest High Low Discount 30-year mortgage yields
selves or agreed to prices that little good and can bury in- Vice Chancellor John Noble ago
1.00 1.00 1.00 0.75 30 days 3.467 3.582 3.750 3.024
were too low. stances of actual wrongdoing. in July compared a settlement Prime rates 60 days 3.497 3.618 3.788 3.080
Plaintiffs’ lawyers say they involving Roche Holding AG’s U.S. 3.50 3.50 3.50 3.25 Federal funds
help police a takeover takeover of biotech company In- Canada 2.70 2.70 3.00 2.70 Effective rate 0.3800 0.2400 0.3800 0.0600 Other short-term rates
scene that can be rife with con-
Most merger terMune Inc. to “deal insur- Japan 1.475 1.475 1.475 1.475 High 0.5600 0.5625 0.5900 0.2500
Low 0.2500 0.0800 0.3000 0.0100 Week 52-Week
flicts of interest. In some cases, lawsuits turn up ance.” Vice Chancellor Sam Policy Rates Bid 0.3500 0.0800 0.3500 0.0000
Latest ago high low
their efforts have found wrong- Glasscock III approved a Sep- Euro zone 0.05 0.05 0.05 0.05 0.5000 0.2500 0.5200 0.0500
doing, recovered money for in-
little in the way of tember settlement related to
Offer
Call money
2.25 2.25 2.25 2.00
vestors and helped clean up un- wrongdoing. software company Riverbed
Commercial paper
savory boardroom practices. Technology Inc.’s buyout but A Week in the Life of the DJIA 30 to 270 days n.q. ... ... ...
Lawyers challenging Dole Food hinted it would be his last.
Co.’s 2013 buyout won $148 mil- In July, Judge Laster rejected And when the five-member A look at how the Dow Jones Industrial Average component stocks Commercial paper (AA financial)
lion for investors in August, a settlement over the sale of court’s senior judge, Chancellor did in the past week and how much each moved the index. The DJIA 90 days 0.57 0.54 0.64 0.06
while a case alleging self-deal- Aeroflex Holdings Corp. after Andre Bouchard, was asked to lost 1078.58 points, or 6.19%, on the week. A $1 change in the price of
any DJIA stock = 6.85-point change in the average. To date, a $1,000 Euro commercial paper
ing transactions at mining com- finding the plaintiffs’ lawyers, bless a settlement involving the n.q. n.q. -0.02 -0.12
investment on Dec. 31 in each current DJIA stock component would 30 day
pany Freeport-McMoRan Inc. who were seeking $875,000, had merger of real-estate websites Two month n.q. n.q. -0.01 -0.09
have returned $28,229, or a loss of 5.90%, on the $30,000
last year collected $138 million done “nothing, zip, zero” for in- Trulia Inc. and Zillow Inc. in investment, including reinvested dividends.
Three month n.q. n.q. 0.01 -0.08
for shareholders. Freeport de- vestors. September, he declined, de- Four month n.q. n.q. 0.02 0.00
Five month n.q. n.q. 0.04 0.01
nied the allegations in the case In October, he shot down a manding more proof that the The Week’s Action
Six month n.q. n.q. 0.05 0.02
and settled it only “to avoid the settlement related to Hewlett- new disclosures were worth- Pct Stock price Point chg $1,000 Invested(year-end '15)
chg (%) change in average Company Symbol Close $1,000 Libor
substantial expense and distrac- Packard Co.’s purchase of Aruba while. A final decision in that
3.65 2.24 15.34 Wal-Mart Stores WMT $63.54 $1,037 One month 0.42380 0.42950 0.42950 0.16650
tion of continued litigation,” a Networks Inc. The pact would case is expected by the end of
–2.25 –2.66 –18.22 McDonald’s MCD $115.48 977 Three month 0.62110 0.61270 0.62110 0.25210
spokesman said at the time. have given Aruba shareholders the month. Six month 0.85080 0.84615 0.85130 0.35390
Most suits turn up little in no additional money, despite Litigants are taking notice. In –3.01 –1.39 –9.52 Verizon VZ 44.83 982 One year 1.15510 1.17800 1.17800 0.60990
the way of wrongdoing and pro- the plaintiffs’ original claim that addition to a decline in new –3.29 –1.74 –11.92 Merck MRK 51.08 967
Euro Libor
duce no extra cash for share- the deal was underpriced, while lawsuits, earlier cases are being –3.38 –1.45 –9.93 Coca-Cola KO 41.51 966 One month -0.214 -0.204 -0.001 -0.214
holders. Companies agree in earning their lawyers a abandoned in larger numbers. Three month -0.139 -0.128 0.049 -0.139
–3.97 –1.28 –8.77 Pfizer PFE 31.00 960
predictable settlements to dis- $387,500 fee. In an unusual re- Advent Software Inc. and Six month -0.053 -0.039 0.131 -0.058
–4.18 –3.26 –22.33 Exxon Mobil XOM 74.69 958 One year 0.048 0.059 0.283 0.031
close additional information— buke from the bench, Judge lawyers suing over its sale to
typically obscure financial anal- Laster dismissed the case and SS&C Technologies Holdings –4.33 –3.44 –23.56 Procter & Gamble PG 75.97 957
Euro interbank offered rate (Euribor)
yses or mundane details of said it typified a “pseudo-litiga- Inc. were negotiating a disclo- –4.35 –5.99 –41.02 IBM IBM 131.63 956 One month -0.218 -0.205 0.009 -0.218
negotiation meetings—and to tion” system where lawyers fol- sure-only settlement this fall, –4.44 –4.56 –31.23 Johnson & Johnson JNJ 98.16 956 Three month -0.143 -0.131 0.071 -0.143
according to people familiar Six month -0.051 -0.040 0.168 -0.051
–5.55 –5.83 –39.93 Walt Disney DIS 99.25 945 One year 0.051 0.060 0.318 0.039
with the matter. As word of the
–5.68 –3.15 –21.57 Microsoft MSFT 52.33 943 Value 52-Week
court’s rulings on Aruba and Latest Traded High Low
others made the rounds, “it was –5.81 –3.63 –24.86 Nike NKE 58.87 942
pencils down,” one of the people –5.90 –5.67 –38.83 United Technologies UTX 90.40 941 DTCC GCF Repo Index
said. The plaintiffs later –6.02 –4.67 –31.98 Visa V 72.88 940 Treasury 0.457 75.950 0.639 0.059
MBS 0.476 66.580 0.705 0.075
dropped the case. –6.09 –6.87 –47.05 Travelers TRV 105.99 939 Open Implied
On its face, the shift would
–6.31 –8.35 –57.18 Home Depot HD 123.90 937 Settle Change Interest Rate
seem to be welcome news for
–6.36 –7.48 –51.23 UnitedHealth Group UNH 110.16 936 DTCC GCF Repo Index Futures
companies, which have long
–6.74 –10.15 –69.51 3M MMM 140.49 933 Treasury Jan 99.540 -0.010 8349 0.460
viewed these lawsuits as a Treasury Feb 99.550 unch. 5705 0.450
“merger tax.” But few are cheer- –6.87 –4.67 –31.98 Caterpillar CAT 63.29 931 Treasury Mar 99.480 -0.010 3958 0.520
ing. Settlements represent a –7.89 –8.30 –56.84 Apple AAPL 96.96 921
cheap, predictable way to avoid –8.15 –5.43 –37.19 DuPont DD 61.17 918
Notes on data:
drawn-out court fights. U.S. prime rate is effective December 17, 2015.
–8.51 –5.92 –40.54 American Express AXP 63.63 919 Discount rate is effective December 17, 2015.
Moreover, a tougher stance U.S. prime rate is the base rate on corporate
–8.53 –2.94 –20.13 Intel INTC 31.51 915
in Delaware may drive cases to loans posted by at least 70% of the 10 largest
other jurisdictions that are less –8.67 –2.70 –18.49 General Electric GE 28.45 913 U.S. banks;
Other prime rates aren’t directly comparable;
predictable. –8.70 –7.83 –53.62 Chevron CVX 82.13 913 lending practices vary widely by location;
DTCC GCF Repo Index is Depository Trust &
“Everyone was holding their –8.75 –2.38 –16.26 Cisco Systems CSCO 24.78 920 Clearing Corp.'s weighted average for overnight
BLOOMBERG NEWS
nose [and settling] because all –9.04 –16.29 –111.56 Goldman Sachs GS 163.94 910
trades in applicable CUSIPs. Value traded is in
billions of U.S. dollars.
parties benefited,” said Steven Futures on the DTCC GCF Repo Index are
–10.10 –14.60 –99.99 Boeing BA 129.99 899
Haas, a corporate partner at traded on NYSE Liffe US.
Hunton & Williams LLP. Now, he –10.77 –7.11 –48.69 J.P. Morgan Chase JPM 58.92 898 Sources: Federal Reserve; Bureau of Labor
Statistics; DTCC; SIX Financial Information;
said, “the question is, ‘what to Sources: WSJ Market Data Group; S&P Dow Jones Indices. For more information on the Dow Jones General Electric Capital Corp.; Tullett Prebon
Delaware Chancery Court, where many merger suits land do?’” Industrial Average and the 30 industrials, please visit www.djindexes.com Information, Ltd.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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The E w
xper
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© 2016 Dow Jones & Company. All Rights Reserved. * * THE WALL STREET JOURNAL. Convn Online Monday, January 11, 2016 | R1
e
DETA rsation
I LS , R2 INSIDE
EXCHANGE-TRADED FUNDS
AFTER A BAD 2015 for emerging-
In Europe’s Beaten
markets stocks, there are potential
Countries, Spread Your Risk
bargains available for investors
How to keep from getting
willing to take on the added risk
burned in the eurozone.
of this volatile sector.
Ireland and Greece diverge.
More investors might be think-
R7
ing about taking that risk now
that the U.S. market has followed
SAVING FOR COLLEGE
an erratic and mostly unrewarding
2015 with a nerve-rattling slide to Is That ‘529’ for Tuition?
start this year. But those who take We answer more readers’
the plunge need to be choosy. That questions on paying the bills
bad start in the U.S., after all, was R8
triggered by a far steeper decline
in China, the biggest emerging FIXED-INCOME INVESTING
market of them all. Should Investors Always
For investors looking to buy an Hold Some Junk? Nope.
emerging-markets fund, China’s The implosion of Third Avenue
troubles are just one thing to keep is evidence that a permanent
in mind when making one of the high-yield allocation isn’t wise
first and most basic choices R8
among funds: Do you buy an ex-
change-traded fund that tracks a NEWS CHALLENGE
market index or an actively man- ROBERT NEUBECKER
Test Your Smarts on...
aged fund? ...the Dow, junk bonds, robo
ETFs in general have become advice. Our monthly news quiz.
increasingly popular in recent R12
years, largely because of lower
fees than actively managed funds
and the fact that many active SCOREBOARD
managers don’t fare well in perfor- some things to consider: For instance, many fund manag- Because of the uncertainty of
mance comparisons with indexes. ers in recent years have held much how markets will move even in the Full-year 2015 fund performance,
But both options have advan- 1. Time tells different smaller allocations of Chinese near term, it is best to examine total return by fund type. More on R2.
tages and disadvantages, and stories for ETFs and funds stocks than the widely followed how active funds have performed U.S. Intl. Bonds
some factors come into play in In comparing the performance MSCI Emerging Markets Index compared with index funds in as stocks* stocks* (intmd.)
emerging markets that don’t enter of an ETF to a similar actively would dictate, Ms. Oey says. Many many different market environ-
into the decision for other funds, managed fund, investors should of those managers beat the index ments as possible. And that uncer-
at least not to the same degree. look at a variety of time frames, when Chinese stocks faltered in tainty is heightened in emerging
So for those who are trying to not just recent returns, says Patri- 2011 and 2012, but lagged behind it markets, which tend to be more –2.1% –1.3% –0.1%
choose between active or passive cia Oey, senior analyst at fund when the Chinese market fared bet- volatile than many other sectors.
emerging-markets funds, here are tracker Morningstar Inc. ter from mid-2013 through 2014. Please turn to the next page *Diversified funds only, excluding sector and
regional/country funds
Source: Lipper THE WALL STREET JOURNAL.
Here is what Predictor fans watch for: A win sidelight in a long Wall Street life. The Whar- tremendous. He is the one who popularized it.”
by an original National Football League team— ton graduate began his career in the 1950s
from the days when there was an NFL and an when Elvis Presley was just starting to record. Mr. Power is a Wall Street Journal news
American Football League, before the 1966 “I got a job as a morning newswire editor at editor. Email him at william.power@wsj.com.
Important information Shares are not individually redeemable and owners of the shares may acquire Invesco Distributors, Inc. is the distributor for PowerShares QQQ which is a
There are risks involved with investing in ETFs, including possible loss of those shares from the Fund and tender those shares for redemption to the unit investment trust.
money. Shares are not actively managed and are subject to risks similar funds in Creation Unit aggregations only, typically consisting of 50,000 shares. An investor should consider investment objectives, risks,
to those of stocks, including those regarding short selling and margin PowerShares® is a registered trademark of Invesco PowerShares Capital
maintenance requirements. Ordinary brokerage commissions apply. The charges and expenses carefully before investing. To obtain a
Management LLC, investment adviser. Invesco PowerShares Capital prospectus, which contains this and other information about
Fund’s return may not match the return of the Underlying Index. The Fund Management LLC (Invesco PowerShares) and Invesco Distributors, Inc., ETF
is subject to certain other risks. Please see the current prospectus for more distributor, are indirect, wholly the QQQ, a unit investment trust, please contact your broker,
information regarding the risk associated with an investment in the Fund. owned subsidiaries of Invesco Ltd. call 800 983 0903 or visit invescopowershares.com.
Shares are not FDIC insured, may lose value and have no bank guarantee. Please read the prospectus carefully before investing.
Special
SpecialAdvertising
Special Advertising Feature
Advertising Section
Section JOURNAL REPORT | INVESTING IN FUNDS & ETFS
Defense
nancial crisis—are probably Markets, are switching the in- points a year, with an average of active management are be-
the best bet. dexes they track to broaden annual return of about 5%, ac- coming more common.
their portfolios by adding cording to S&P Capital IQ. For instance, as volatility has
2. Fees can be a lot more Chinese stocks. Mr. Van Eck says there are risen, investors have flocked to
higher for active funds But many Chinese compa- some compelling arguments iShares MSCI Emerging Mar-
How a sector strategy can help you Active emerging-markets nies with the biggest market for active management in kets Minimum Volatility
funds tracked by Morningstar capitalizations are state-con- emerging-markets funds. For (EEMV). It rebalances its port-
manage risk as markets shift on average charge more than trolled entities, which worries one thing, he says that with folio regularly to maintain a fo-
1.5% of assets a year for man- some advisers. Those compa- each of the countries in the cus on stocks that gyrate less
E
very investor has to face risk, and building a agement and administrative nies’ actions may be influ- category at a different point in than the broad market of
portfolio lets you try to set a level of risk that expenses. That is about 10 enced more by political objec- its development cycle, “you emerging-markets shares. “It
works for you. You may build a portfolio for your times the fees for ETFs such as tives, such as maintaining jobs absolutely don’t want to have provides emerging-markets ex-
situation and goals by trading off the level of stocks, the Vanguard FTSE Emerging growth, than by shareholder exposure to all countries at all posure, which is risky in gen-
Markets ETF (VWO). concerns such as profitability, times.” Moreover, he says, eral, but by using the least
bonds, cash, or other asset classes. But within your U.S. Fees are deducted from what says Don Wilson, chief invest- “there are a lot of junky com- risky stocks within the EM
stocks, you may want to consider your mix of sectors as funds make on investments, so ment officer at Brightworth, a panies included in indexes, space,” says Todd Rosenbluth,
a way to help manage risk. they erode net returns. wealth-management firm even in our indexes.” director of ETF and mutual-
Sectors are different collections of companies Based on performance com- based in Atlanta. “You want someone who fund research at S&P Capital IQ.
parisons, “I am highly dubious Mr. Wilson says active man- can shift the company, [indus- One possible downside, Mr.
grouped by their type of business. The Global Industry that active management really agers will lean toward compa- try] sector and country expo- Rosenbluth says, is that the
Classification Standard (GICS) identifies 10 distinct adds any value, especially in nies that have consistently sure over time,” he adds. “If fund ignores valuation. “If
stock market sectors. Because each sector has unique the emerging markets,” says strong financial performance. you want to have one fund for [low-volatility] emerging-mar-
characteristics and is driven by different economic fac- Chris Cordaro, chief invest- That makes those funds’ port- emerging markets, active is kets stocks get bid up, this ETF
ment officer at RegentAtlantic folios less vulnerable than in- the way to go.” will continue to hold them,
tors, together they make compelling building blocks Capital, a wealth-management dexes to market downdrafts, he Active funds also give man- whereas an active manager
for the equity portion of your portfolio. firm based in Morristown, N.J. says. Emerging markets are “a agers the freedom to include would probably sell,” he says.
There are several ways you can use sectors to build But others say active funds good place to consider active stocks from outside the cate- That could be an issue for in-
a portfolio that targets less volatility or reduces the risk can be worth the higher fees managers,” Mr. Wilson says. gory in their portfolio. The vestors who worry that rising
because their managers can seventh-largest holding of the valuations can make stocks
of a drop in value — drawdown risk — compared to the take steps to lessen some of 4. Active-funds flexibility Thornburg Developing World more vulnerable to a reversal.
market overall. One is to create a long-term strategic the risks of emerging-markets The emerging-markets um- fund (THDAX) recently was Joseph Nelesen, director of
allocation designed to capture much of the gains of the investing, and they point to brella covers a wide variety of Facebook Inc. Instead of just the U.S. iShares product group,
market with less volatility. More active investors may examples of active funds that countries and companies. Man- owning companies in emerg- says the ETF wouldn’t sell a
have outperformed index- agers of active funds can make ing markets, “we like to think stock solely because of valua-
want to consider a strategy that tilts the portfolio to- tracking counterparts. distinctions among that huge about who is selling into the tion—but volatility sometimes
ward sectors that are expected to outperform the mar- range of stocks that an index- most interesting trends there,” increases with a stock’s value, in
ket based on where we are within the business cycle. 3. Political risk tracking fund doesn’t make. says manager Charlie Wilson. which case the fund might re-
Widely used benchmarks Jan van Eck is chief execu- Over five years, the fund has duce or eliminate its position.
Managing volatility such as the MSCI Emerging tive of Van Eck Global, which beaten the returns of the
Markets Index are based on sponsors ETFs as well as an MSCI Emerging Markets Index Mr. Pollock is a writer in
Volatility in this case means the magnitude of fluctu- market capitalization, so the active emerging-markets eq- by an average of nearly 4.5 Ridgewood, N.J. He can be
ations in sector returns over time. While the volatility of countries with the largest uity fund. The Van Eck percentage points a year. reached at reports@wsj.com.
sectors may evolve over time, history shows that some
sectors have been less volatile than others because the
demand for their products and services tends to be less Benchmark Beaters
Actively managed emerging-markets funds that have beaten a popular iShares ETF over 10 years
sensitive to changes in the economy. Think toothpaste
Name Ticker 10-year return Comments from S&P Capital IQ
makers versus mortgage lenders.
Virtus Emerging Markets Opportunities HEMZX 6.5% Significant (30%) India weighting, higher weighting in Brazil
Because of the correlation levels among sectors, a
Driehaus Emerging Markets Growth DREGX 6.0% Underweight to China & Korea/overweight India & Mexico
market-weighted portfolio of sectors has historically
Oppenheimer Developing Markets ODMAX 5.8% High weightings in India/Brazil and little exposure to Taiwan
lowered overall volatility to less than that of most indi-
American Funds New World Fund NEWFX 5.7% 8% in U.K. & 17% rest of developed Europe, plus 15% U.S.
vidual sectors. And risk-averse investors may want to
Wells Fargo Advantage Emerging Mkts EMGAX 5.3% High Mexico/India vs. low exposure to Taiwan
construct a portfolio that tilts toward the historically less
Van Eck Emerging Markets GBFAX 4.6% Minimal exposure to Korea; India and Brazil relatively high
volatile sectors: consumer staples, utilities, health care,
Invesco Developing Markets GTDDX 4.6% India again relatively high as is Indonesia
telecom, and energy. Recent research from Fidelity’s
equity and Asset Allocation Research Team shows that iShares MSCI Emerging Markets EEM 2.8%
such a risk-managed portfolio would have had consist- Sources: S&P Capital IQ’s MarketScope Advisor; Morningstar; fund-company websites THE WALL STREET JOURNAL.
Find the full version of this research, updates on Mr. Power is a Wall Street Journal news editor in South
the business cycle, and other insights at Brunswick, N.J. Email him at william.power@wsj.com.
Fidelity.com/Viewpoints
JAMES YANG
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Stock markets are volatile and can decline significantly in response to adverse issuer, This Journal Report doesn’t stop here. that loan?
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Because of its narrow focus, sector investing tends to be more volatile than investments that
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Go to Fidelity.com/sectors
Before investing in any mutual fund or exchange-traded fund, you should consider its investment objectives,
risks, charges, and expenses. Contact Fidelity for a prospectus, offering circular or, if available, a summary
prospectus containing this information. Read it carefully.
ETFs are subject to market fluctuation and the risks of their underlying investments. ETFs are subject to
management fees and other expenses. Unlike mutual funds, ETF shares are bought and sold at market price,
which may be higher or lower than their NAV, and are not individually redeemed from the fund.
Stock markets, especially foreign markets, are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments. Sector funds can be more volatile because of their
narrow concentration in a specific industry.
*Morningstar Direct, data as of 02/09/2015. Based on a comparison of total offerings of distinct U.S. Mutual Funds and ETFs classified by Morningstar as Sector Equity within the universe of 175 U.S. investment firms offering
mutual funds and ETFs.
System availability and response times may be subject to market conditions.
Fidelity Brokerage Services LLC, Member NYSE, SIPC. © 2015 FMR LLC. All rights reserved. 712582.1.0
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R4 | Monday, January 11, 2016 THE WALL STREET JOURNAL.
47%, depending on which class cals Inc., a biopharmaceutical Stock & Bond Benchmark Indexes All total return unless noted
of stock you owned. company with an array of Perfomance (%) Performance (%)
The fund managers who products in development, is a Investment objective December 4th-qtr 1-yr 5-yr* Investment objective December 4th-qtr 1-yr 5-yr*
fared best in the final Wall Polen’s Damon Ficklin business that the Polen team Large-cap stocks Stock indexes
Street Journal Winners’ Circle finds particularly intriguing
DJIA –1.5 7.7 0.2 11.3 DJ U.S. TSM Growth –2.6 5.6 2.5 13.0
competition of 2015 turned outsize stake in Google, aka and in which it has invested
S&P 500 –1.6 7.0 1.4 12.6 DJ U.S. TSM Value –1.4 7.0 –1.5 11.3
out, unsurprisingly, to own Alphabet, which Mr. Davidow- about 5% of its assets. The
many of these stocks. itz brought to a total of about stock rose 32% for the year. “A Midcap stocks Taxable bonds
The winners also placed rel- 8.5% of the portfolio in late year or more ago, the expecta- S&P MidCap 400 –4.2 2.6 –2.2 10.7 Barclays Agg. Bond –0.3 –0.6 0.5 3.2
atively outsize bets on these 2014, at a time when the stock tion was the growth rate in its Small-cap stocks Municipal bonds
businesses and their manage- was a laggard. Until recently, core franchise for a drug Russell 2000 –5.0 3.6 –4.4 9.2 Barclays Muni. Bond 0.7 1.5 3.3 5.3
ment teams throughout the the company has been more of treating macular degeneration Broad stock market International stocks
year. While the managers of a drag on the portfolio than a would decelerate,” says Mr. DJ U.S. Total Stock Market –2.0 6.3 0.4 12.1 MSCI EAFE†† (price return) –1.4 4.4 –3.3 0.7
many diversified U.S.-stock contributor, but now its poten- Ficklin. Instead, it picked up Russell 3000 –2.1 6.3 0.5 12.2 Dow Jones World (ex. U.S.) –1.6 3.8 –4.4 1.5
funds try to diversify their tial is being reflected in its and the company pushed
*Annualized †Diversified funds only **Excludes money-market funds ††Europe, Australia, Far East
portfolios, scattering their as- market performance. “It was ahead with new products to
sets among 50 to 100 or more our biggest winner by a pretty treat rheumatoid arthritis,
companies to minimize risk wide margin,” says Mr. Ficklin. asthma and other conditions.
and maximize the chance that That is thanks to some big Largest Stock and Balanced Funds Data provided by
they will end up invested in changes within the new Alpha- No. 2 Goes to ‘Sig’
the next winner, all three of bet itself. Regeneron is one of several Total returns are for periods ended Dec. 31 . All data is final. Assets are through Nov. 30.
the top performers in our con- “One of the strikes against holdings that Polen Capital Performance data include both share prices and reinvested dividends.
test for the latest quarter Google was that they weren’t shares with this quarter’s run- Assets Performance (%)
manage concentrated portfo- always terribly forthcoming ner-up, Prudential Jennison Fund Name Symbol ($ millions) Dec. 4th-qtr 1-year 3-year* 5-year*
lios, investing in only a small with important financial infor- Select Growth Fund (SPFAX). Vanguard TSM Idx;Adm VTSAX 404,241.6 –2.0 6.3 0.4 14.7 12.2
number of companies. mation,” says Mr. Ficklin. “You Run by 82-year-old Spiros Vanguard 500 Index;Adm VFIAX 221,251.7 –1.6 7.0 1.4 15.1 12.5
The contest doesn’t dis- could tell how much they were “Sig” Segalas, a founder of Vanguard Instl Indx;Inst VINIX 197,210.1 –1.6 7.1 1.4 15.1 12.5
criminate between large or earmarking for capital spend- Jennison Associates, the $382
Vanguard Tot I Stk;Inv VGTSX 187,729.0 –2.1 2.7 –4.4 1.8 1.2
small funds, nor does it matter ing, but not what parts of million fund wrapped up 2015
SPDR S&P 500 ETF SPY 180,508.6 –1.6 7.0 1.3 15.0 12.5
whether the managers choose their business it was going to- with a return of 12.5%. Al-
to own only a tiny number of though Mr. Segalas is willing American Funds Gro;A AGTHX 147,227.5 –1.5 7.8 5.4 15.5 12.1
positions or prefer to invest to own more stocks than the American Funds EuPc;R-6 RERGX 126,954.6 –2.3 3.0 –0.5 5.5 4.0
billions of dollars in 150 or
The place to be was 20 or so positions in the Polen Fidelity Contrafund FCNTX 111,246.7 –1.3 6.3 6.5 16.1 12.7
more companies at a time. the FANG stocks— fund, it is still a relatively American Funds CIB;A CAIBX 96,041.6 –1.4 2.6 –2.9 6.0 6.5
Every diversified U.S.-stock small number—only 40 or so— American Funds Inc;A AMECX 95,538.2 –1.1 4.7 –1.5 8.1 8.3
fund with at least $50 million
Facebook, Amazon, and he is willing to make big Fidelity Sp 500 Idx;Adv FUSVX 91,885.6 –1.6 7.0 1.4 15.1 12.5
in assets and a track record of Netflix and Google. bets on his favorites.
Vanguard Wellington;A VWENX 88,740.1 –1.4 4.1 0.1 9.6 9.1
more than three years is eligi- Indeed, two FANG stocks
American Funds Bal;A ABALX 85,092.1 –1.1 5.0 1.7 10.5 9.8
ble for consideration, as long dominated the portfolio: Face-
as it is actively managed. In- ward.” With a new chief finan- book, which accounted for American Funds CWGI;A CWGIX 84,336.8 –2.2 4.0 –2.2 8.3 7.0
dex funds and exchange-traded cial officer, Ruth Porat, and a nearly 7% of its assets by De- Franklin Cust:Inc;A FKINX 80,412.1 –2.8 1.4 –7.8 3.1 5.1
funds don’t qualify, for that new corporate structure that cember, and Amazon, at 5.6%, American Funds Wash;A AWSHX 77,660.2 –1.5 7.3 –0.2 13.6 12.0
reason; neither do leveraged separates Google’s core search by the end of the year. American Funds FInv;A ANCFX 74,436.8 –1.8 8.1 3.4 14.0 11.2
funds. Hybrid funds that rely business from those that re- Messrs. Segalas and Ficklin American Funds ICA;A AIVSX 74,309.6 –2.2 5.9 –1.4 13.5 10.7
on combinations of fixed in- quire more capital, which took warn not to conclude, based iShares:Core S&P 500 IVV 70,469.2 –1.6 7.0 1.3 15.1 12.5
come and equity index prod- effect at the end of the third on the FANG stocks, that it’s Vanguard Md-Cp Idx;Adm VIMAX 67,024.9 –2.7 3.4 –1.3 14.9 11.5
ucts also don’t make the cut. quarter, that is changing, he necessary to chase after tech
Dodge & Cox Intl Stock DODFX 61,812.1 –4.9 0.8 –11.4 3.9 2.7
Laurels go to the fund that adds. He says the market also names or the latest idea from
posts the best performance for viewed the first buyback au- Silicon Valley to get above-av- American Funds NPer;A ANWPX 61,112.5 –1.5 6.8 5.3 11.3 9.0
the trailing 12 months, at the thorization, just announced, as erage growth in earnings and iShares:MSCI EAFE ETF EFA 58,439.4 –1.4 4.6 –0.9 4.9 3.5
end of each quarter. being shareholder-friendly. share performance. Both count Dodge & Cox Stock DODGX 56,975.6 –2.7 4.5 –4.5 14.0 11.6
The Polen fund’s invest- Starbucks among their win- Vanguard Sm-Cp Idx;Adm VSMAX 56,000.8 –4.2 3.1 –3.6 12.6 10.4
No. 1 fund’s strong finish ment in Google might be large, ners for the year; both also Vanguard FTSE Dev Mk ETF VEA 53,948.6 –1.8 3.9 –0.2 4.7 3.6
The winner: Polen Growth but it isn’t unusual for Mr. point to Nike Inc., up 30%, as Vanguard Health Care;Adm VGHAX 51,725.5 1.3 8.7 12.7 27.6 21.7
Fund (POLIX), managed by Ficklin and Mr. Davidowitz to an example of how a classic Vanguard REIT Idx;ETF VNQ 51,692.9 1.8 7.0 2.4 11.0 11.8
Daniel Davidowitz and Damon take outsize positions in the company can remain a winner Vanguard FTSE Em Mkt ETF VWO 51,327.1 –2.5 –0.3 –15.4 –6.8 –4.8
Ficklin, which repeated its companies that they like. At for the long haul. “It has cap- BlackRock:Gl Alloc;I MALOX 51,053.9 –1.0 2.9 –0.8 5.1 4.4
third-quarter winning perfor- any given point, they will own tured the imagination of mil-
mance in the final quarter. The only 20 companies, and since lennials,” says Mr. Segalas. Vanguard Gro Idx;ETF VUG 50,921.4 –2.4 6.5 3.3 15.8 13.1
$850 million fund ended the 1989, when they began run- American Funds AMCP;A AMCPX 47,727.9 –2.2 5.5 0.8 15.6 12.4
full year with a 14.6% gain, ning portfolios using their Ms. McGee is a writer in New First Eagle:Global;I SGIIX 47,442.8 –1.8 4.5 –0.7 5.9 6.0
beating its closest rivals by strategy, they have owned a England. She can be reached Vanguard Windsor II;Adm VWNAX 46,752.4 –2.5 4.5 –3.1 12.1 11.1
more than 2 percentage points. total of only 108 companies. at reports@wsj.com. Vanguard PRIMECAP;Adm VPMAX 46,191.0 –0.4 8.8 2.6 19.5 14.1
T Rowe Price Gro Stk PRGFX 46,174.8 –0.4 8.6 10.9 18.9 14.6
Vanguard Ext Mk Id;Inst+ VEMPX 44,332.7 –3.9 3.2 –3.2 13.0 N.A.
The Score at the Quarter Harbor:Internatl;Inst HAINX 44,099.0 –2.3 2.9 –3.8 1.6 2.4
Stock funds rose 4% in the fourth quarter, so still haven't fallen for two quarters since the 2008-09 PowerShares QQQ Trust 1 QQQ 43,058.5 –1.5 10.2 9.5 21.3 16.8
financial crisis. But the funds dropped 2.1% overall for 2015. Average total return (U.S. diversified funds). Fidelity Low-Prcd Stk FLPSX 41,497.4 –2.7 1.6 –0.6 12.9 11.2
20% Vanguard Wellesley;Adm VWIAX 41,238.2 –0.8 2.6 1.4 6.2 7.7
15 Fidelity Gro Company FDGRX 41,128.0 –1.0 9.4 7.8 19.3 15.2
10
Vanguard Ins T StMk;Ins+ VITPX 39,809.1 –2.0 6.3 0.5 14.8 12.3
Vanguard Value Idx;ETF VTV 37,861.1 –1.0 7.0 –0.9 14.3 11.7
5 0.03
American Funds Mut;A AMRMX 35,758.0 –1.9 5.4 –2.8 11.9 10.5
0 0.29 MFS Value;I MEIIX 35,370.3 –2.6 5.6 –0.5 14.3 11.7
–0.32 iShares:Russ 1000 Gr ETF IWF 31,122.6 –1.5 7.3 5.5 16.6 13.3
–5
Fidelity Sp Tot Mk;Adv FSTVX 31,091.3 –2.0 6.3 0.5 14.7 12.1
–10 T Rowe Price BC Gro TRBCX 31,007.3 –0.5 9.9 11.2 19.8 15.6
–15 Vanguard Tgt Ret2025;Inv VTTVX 30,612.6 –1.5 3.1 –0.9 7.9 7.2
–20 Oppenheimer Dev Mkts;Y ODVYX 30,512.7 –2.2 4.7 –13.8 –3.7 –2.3
iShares:Russ 2000 ETF IWM 29,114.2 –5.0 3.7 –4.3 11.7 9.2
–25
Oakmark Internatl;I OAKIX 28,456.5 –2.7 5.2 –3.8 5.6 5.5
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Fidelity Balanced FBALX 28,446.6 –1.5 4.3 0.4 10.1 8.9
Source: Lipper THE WALL STREET JOURNAL. Harbor:Cap Apprec;Inst HACAX 27,786.2 –1.5 8.1 11.0 18.9 14.4
American Funds SMCP;A SMCWX 27,752.6 –1.9 3.2 2.6 10.5 7.1
Tracking Exchange-Traded Portfolios Fidelity Adv New Ins;I FINSX 27,547.7 –1.9 5.5 2.6 14.3 11.5
Performance figures are total returns for periods ended Dec. 31; for largest exchange-traded funds and iShares:Core S&P Md-Cp IJH 27,202.3 –4.2 2.6 –2.2 12.7 10.6
other portfolios, ranked by asset size. iShares:Russ 1000 Vl ETF IWD 27,055.7 –2.2 5.6 –4.0 12.9 11.1
Assets Volume Expense Launch Performance (%)
Fund Symbol ($ billions) (000s) ratio date December 4th-qtr 1-year
Vanguard Tgt Ret2020;Inv VTWNX 26,985.7 –1.4 2.7 –0.7 7.2 6.9
SPDR S&P 500 ETF SPY 182.04 113,998.0 0.09 01/22/93 –1.6 7.0 1.3 Vanguard Bal Index;Adm VBIAX 26,660.9 –1.4 3.4 0.5 9.3 8.7
iShares Core S&P 500 ETF IVV 70.35 6,229.6 0.07 05/15/00 –1.6 7.0 1.3 Vanguard Div Gro;Inv VDIGX 26,216.6 –1.0 6.9 2.7 14.7 12.8
iShares MSCI EAFE ETF EFA 60.15 31,818.9 0.33 08/14/01 –1.4 4.6 –0.9 MFS Intl Value;I MINIX 25,627.5 –0.8 5.5 6.8 11.4 9.6
Vanguard Tot Stk Mkt Idx ETF VTI 57.41 3,652.6 0.05 05/24/01 –2.0 6.3 0.4 Fidelity Puritan FPURX 25,568.7 –1.2 5.2 1.8 10.7 9.2
PowerShares QQQ Nasdaq 100 QQQ 43.05 29,529.5 0.20 03/10/99 –1.5 10.2 9.5 T Rowe Price MC Gr RPMGX 25,360.4 –2.0 5.2 6.6 18.2 13.2
Vanguard 500 Index ETF VOO 40.44 419.3 0.05 09/07/10 –1.6 7.0 1.4
Franklin Mut Gl Disc;A TEDIX 25,297.7 –2.7 3.8 –3.6 8.2 6.9
Vanguard FTSE Emerging Markets ETF VWO 34.45 18,735.4 0.15 03/04/05 –2.5 –0.3 –15.4
T Rowe Price Eq Idx500 PREIX 25,227.3 –1.6 7.0 1.1 14.8 12.3
iShares Russell 1000 Growth ETF IWF 31.59 2,430.6 0.20 05/22/00 –1.5 7.3 5.5
T Rowe Price Ret:2020 TRRBX 25,194.8 –1.3 3.2 –0.3 7.5 7.2
iShares Core US Aggregate Bond ETF AGG 30.57 3,406.1 0.07 09/22/03 –0.3 –0.6 0.5
Fidelity Str Adv Core FCSAX 24,944.8 –1.7 6.5 0.1 14.2 11.1
Vanguard FTSE Developed Markets ETF VEA 29.29 11,420.1 0.09 07/20/07 –1.8 3.9 –0.2
T Rowe Price Cap App PRWCX 24,813.2 –1.3 4.5 5.4 13.2 11.4
iShares Russell 2000 ETF IWM 27.69 39,033.9 0.20 05/22/00 –5.0 3.7 –4.3
Vanguard REIT ETF VNQ 27.51 3,292.4 0.12 09/23/04 1.8 7.0 2.4 T Rowe Price Ret:2030 TRRCX 24,653.5 –1.4 4.2 -0.02 9.3 8.2
iShares Russell 1000 Value ETF IWD 27.36 2,583.7 0.20 05/22/00 –2.2 5.6 –4.0 Vanguard FTSE xUS;ETF VEU 24,129.6 –2.2 2.6 –4.7 1.6 1.3
Vanguard Total Bond Market ETF BND 27.26 2,419.7 0.07 04/03/07 –0.4 –0.6 0.4 T Rowe Price Eq Inc PRFDX 24,089.4 –2.3 5.7 –6.7 9.2 8.7
iShares Core S&P Mid-Cap ETF IJH 26.47 1,390.1 0.13 05/22/00 –4.2 2.6 –2.2 Vanguard Div App Idx;ETF VIG 23,642.4 –0.8 6.1 –2.0 11.7 10.5
*Expense charge is a maximum of 8 cents a share †Assets are estimated N.A.= Not applicable, fund is too new. Vanguard Tgt Ret2035;Inv VTTHX 23,414.5 –1.7 3.9 –1.3 9.2 7.9
Note: Total returns are based on the change in the net asset values, not changes in market prices. Net asset values can vary from market prices, which
therefore can reflect a premium or discount to the net asset values. Source: Thomson Reuters Note: For funds with multiple share classes, only the largest is shown *Annualized N.A.=Not applicable or not available
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THE WALL STREET JOURNAL. Monday, January 11, 2016 | R5
At Columbia Threadneedle Investments, we know it’s not easy being a financial advisor.
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Want an example? Consider our Columbia Strategic Income Fund,
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funds and 63 Threadneedle funds have an Overall Rating of 4- or 5-stars. The Overall Morningstar Rating™ for a fund is derived from a weighted average of the performance experience value impairments during liquidation. Prepayment and extension risk exists because a loan, bond or other investment may be called, prepaid or redeemed before
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others within a particular country, as well as to currency instabilities and less stringent financial and accounting standards generally applicable to U.S. issuers. Risks are
The data for U.K. funds relates to the U.K. registered funds universe and for Luxembourg funds to the Offshore/International universe. enhanced for emerging market and sovereign debt issuers. Investing in derivatives is a specialized activity that involves special risks that subject the fund to significant loss
potential, including when used as leverage, and may result in greater fluctuation in fund value. Liquidity risk is associated with the difficulty of selling underlying investments
All ratings are for Class Z shares as of 09/30/15. at a desirable time or price.
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© 2015 Morningstar, Inc. All rights reserved. The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not © 2015 Columbia Management Investment Advisers, LLC. All rights reserved. Not FDIC Insured • No Bank Guarantee • May Lose Value 1321976
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R6 | Monday, January 11, 2016 THE WALL STREET JOURNAL.
N.A.: Not applicable; fund is too new * Annualized Note: For funds with multiple share classes, only the largest is shown.
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THE WALL STREET JOURNAL. Monday, January 11, 2016 | R7
Mixed Bag
ETFs focused on the eurozone's Piigs had varying performances
in 2015, as did the countries themselves.
30% iShares MSCI Ireland
Capped ETF
20 EIRL-USA
Global X FTSE
–10 Portugal 20 ETF
PGAL-USA
–20
iShares MSCI Spain
–30 Capped ETF
EWP-USA
–40
Global X FTSE
Greece 20 ETF
–50 GREK-USA
J F M A M J J A S O N D
Source: FactSet THE WALL STREET JOURNAL.
JIM TSINGANOS
stein, a principal at Efficient Fron- college or graduate school. Some The short answer is no. “In
tier Advisors LLC, an investment- recent questions The Wall Street general, travel expenses are not
advisory firm in Eastford, Conn. But Journal has received, and the ad- included as a qualified higher-ed-
that doesn’t mean investors should vice from experts: ucation expense,” Mr. Bernhardt
never own junk, he says. It means says. Investors can spend 529
i i i
holding high-yield bonds is only ad- mium is the spread. pens during the next wave of de- funds on tuition, books, room and
vantageous at certain times. But here’s the rub: How wide faults. When 529 funds are used to board, and other college-related
spreads need to be to justify buying pay for college tuition, how expenses if they can show that
Watching the spreads high-yield bonds and how narrow Are we there yet? does one prove to the IRS that these purchases are a requisite
Based on data going back to 1983, they need to be to justify selling are One alternative for investors who the money was spent on tuition? part of school. One exception:
Mr. Bernstein says the extra returns judgment calls that are easy to get want some exposure to high-yield When you have a 529 plan, Special-needs beneficiaries might
of high-yield bonds, in comparison wrong. debt without the confusion and risk you’ll get a form 1099-Q detailing be able to show that their travel
with safer investment-grade bonds, In a paper he wrote in 2001, Mr. of timing the market is to buy a fund any withdrawals you make from costs are required for them to at-
aren’t enough to justify owning them Bernstein gave an example of how to that holds investment-grade as well your account, says Keith Bern- tend a qualified educational insti-
continuously, because of junk bonds’ approach that decision. Assuming a as junk bonds, and let the fund man- hardt, vice president of retire- tution. IRS publication 970 lays
volatility and the uncertainty of 7% default rate in a junk-bond port- ager decide on the ideal mix at any ment and college products at out which expenses qualify for
their default rates. folio and a 40% recovery rate—mean- given point. fund manager Fidelity Invest- 529 withdrawals under the rules.
However, Mr. Bernstein says it ing investors could expect to recover A view similar to Mr. Bernstein’s ments. “However, it is up to the
i i i
does make sense for investors to 40% of the face value of bonds in de- is held by the bond-specialist firm account owner to keep track of
own high-yield bonds when their fault—the portfolio would have 4.2 DoubleLine Capital, which runs sev- which withdrawals were for qual- My son has $15k saved from
“spreads”—the difference between percentage points shaved off its an- eral mutual funds. “We prefer to use ified higher education expenses his job. Can he make a gift of
their yields and those of comparable nual return because of defaults, he high-yield bonds in the context of and which withdrawals are not this money to his parents,
U.S. Treasury securities—are wide. said. In that case, if the portfolio’s active sector allocation rather than eligible for favorable tax treat- which we then put into his 529
That happens when the prices of yield were, say, 3 percentage points always maintaining a static weight- ment,” he says. Beware: If you for a tax break?
high-yield bonds have fallen, pushing higher than that of comparable Trea- ing to this area,” says Kapil Singh, a make any withdrawals that don’t The main tax advantage of a
up their yields. On the other hand, sury securities, that extra yield portfolio manager at DoubleLine, meet the IRS guidelines, you will 529 is that the money grows tax-
he says, it makes sense to sell high- wouldn’t be enough to offset the loss Mr. Singh is responsible for the have to report those on your tax free until withdrawn for qualified
yield bonds when their spreads nar- from the defaults. Investors would high-yield allocation in the Double- returns, since there is a penalty. educational expenses. There are
row, as they do when the bonds’ have been better off owning Trea- Line Core Fixed Income fund no federal income-tax breaks for
i i i
prices rise. In other words, buy surys. However, if the spread were, (DBLFX). The fund is designed to re- 529 contributions; however, you
when prices are low and sell high. say, 9 percentage points, investors semble the Barclays U.S. Aggregate Many years ago I set up a might be able to get a state in-
“Most of the time, it’s not worth would do better by owning the junk Bond Index. 529 plan for my son. I funded come-tax deduction, depending
it” to own high-yield debt, Mr. Bern- bonds than they would by owning High-yield bonds made up 8.1% of his education from other on where you live. Check with
stein says. “But occasionally, in bad Treasurys—given the assumed de- Core Fixed Income’s portfolio in May sources and he has now fin- your tax adviser about your own
states of the world, it’s nice to col- fault and recovery rates. but just 2.6% in November. The deci- ished college. Can I repay my- plan and state rules.
lect a double-digit yield premium But default and recovery rates are sion to sell most of the fund’s high- self with a large lump sum
i i i
while you’re waiting for [bond] unpredictable. Historical averages yield position over the summer as without penalties even though
prices to recover.” The yield pre- may not match up with what hap- prices in the sector tumbled helped the expenses occurred over a Our son is now 22 and will be
Core Fixed Income finish in the top period of four years? using the 529 we set up to pay
2% of fund tracker Morningstar Inc.’s This approach could be asking for graduate-level study. Can
Rarely Average intermediate-bond category for the for trouble. As a cash-basis tax- we transfer ownership to him?
Junk-bond spreads (the difference in their yield compared with Treasurys) have a five years through 2015, with a 5.1% payer, “you must take the with- That depends on your 529’s
long-term average of 5.8% but they are almost always above or below that. annualized return. drawals in the same calendar rules. Either way, says Mr. Bern-
So, now that junk-bond prices year the expenses were paid,” hardt, even “if your state’s plan
25% have come down significantly, is it says Joseph Hurley, the founder does not permit transferring
20 time to add to high-yield holdings? of 529-advice site SavingForCol- ownership, you can still withdraw
Mr. Singh says his appetite for high- lege.com. Otherwise, you’ll have funds to pay for qualified educa-
15 yield bonds is still limited, though he to pay tax and a 10% penalty on tion expenses at the graduate-
adds that the bonds of some compa- the earnings portion of your school level.”
10 nies he follows are beginning to be- withdrawals, he says. Such earn- The original account owner
Spread* come attractively priced. ings may be considerable, de- can also roll over a 529 to a plan
5
Average pending on how long it has been that allows ownership changes,
0 Mr. Coumarianos, a former since the years in which the Mr. Hurley says. It is also permit-
’97 ’98 ’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 ’15 Morningstar analyst, is a writer withdrawals should have been ted to change a 529 account to
*Bank of America Merrill Lynch Master II Spread in Laguna Hills, Calif. He can be made. Mr. Bernhardt sees a red benefit any direct relative of the
Source: St. Louis Fed THE WALL STREET JOURNAL. reached at reports@wsj.com. flag as well. “Generally, it is wise original beneficiary.
ALTERNATIVE INVESTMENTS
IN TRANSLATION
Commodity Funds Fall Short, Study Says REVERSAL VS. CORRECTION
downturn of March 2000 to Septem- traders have a terrible time because
BY SIMON CONSTABLE
ber 2002 and the financial crisis of commodities can only really fall so What is the difference be- the indexes were about to
October 2007 to March 2009, spe- far,” says Victor Sperandeo (also tween a reversal and a cor- embark on a long-sustained
SOBERING NEWS for investors in cialty-commodity funds added value. known as “Trader Vic”) of Dallas rection? downward path, such as
specialty-commodity mutual funds: commodity-trading adviser EAM It could matter a lot if what investors experienced
On average, they fall short on key Big hurdles Partners LP. A bushel of wheat can’t you are trading. starting September 2007
measures, new research has found. The researchers examined four go bankrupt like a company. It will By Wall Street’s rule of through early 2009. That is
“These categories of funds have categories of mutual funds from as still be worth something. The result thumb, a correction is gen- to say, none of the stock-
not been able to consistently create far back as March 1956 through De- is that during a bear market, inves- erally defined as a pullback in a mar- market dips since 2009 amounted to
positive net alphas for their inves- cember 2012. The categories are: tors can only make so much money ket or index of 10% or more. More a reversal.
tors over longer time periods,” the commodity funds that invest in the by selling futures short—that is, sell- colloquially, it means that the under- For the past 12 months the S&P
report states. Alpha is a measure of physical materials or derivatives; ing them in the hopes of buying lying trend, either up or down, re- 500 index of large stocks has
the value fund managers add to the natural-resources funds that invest them back later at a lower price and mains in place. In short, a correction bounced around, neither continuing
investment process when adjusted in materials companies; equity en- pocketing the difference. is a temporary blip. the trend upward nor starting a new
for risk factors ergy funds that invest in energy A reversal is a more-lasting one downward.
such as volatil- stocks; and precious-metals funds Other drawbacks change of direction for the index. That “sideways” movement is
ity. that invest in mining companies and Commodities investors also face (Meanwhile, a 20% move in either making some market strategists
The funds’ precious-metals bullion. liquidity issues that investors in direction is the rule-of-thumb defini- worried that a reversal may occur in
high expenses For three categories of the bonds or big stocks rarely have to tion of a bear or bull market.) which a new downward trend starts.
are often to funds—natural resources, equity en- confront. “Cocoa is very thinly Starting in March 2009 the ma- If such a trend does start, these
blame, accord- ergy, and precious metals—the rea- traded,” says Mr. Sperandeo. That jor stock indexes have trended strategists will want to warn inves-
ing to the re- son they didn’t add value on average means sometimes there isn’t enough higher. Occasionally, there have been tors earlier rather than later.
MISHAL THAPA
port by Srini- was because of expenses. Were it not activity in the market to allow a pullbacks, some of which conform Still, the truth is that no one will
dhi Kanuri at for that burden—the funds’ median trader to buy or sell a position with- to the technical definition of a cor- really know whether something is a
the University net annual costs were 1.56%, 1.56% out substantially affecting the price. rection. correction or a reversal until after the
of Southern and 1.37%, respectively—the funds What’s more, with commodities But none of the declines have fact.
Srinidhi Kanuri Mississippi, would have added value for inves- there also is often plenty of activity been so sustained as to indicate that —Simon Constable
Robert McLeod tors, according to the report. away from the exchanges. As Mr.
at the University of Alabama and Da- The weakest group of funds was Sperandeo says, “it’s hard to tell
vinder Malhotra at Philadelphia Uni- the one focused solely on physical what’s going on off-market.” Largest Taxable-Bond Funds
versity. The study is expected to be materials and derivatives; those So what other options do inves- Data provided by
published in the Journal of Wealth funds didn’t add value even before tors have? David Ranson, director of Total returns are for periods ended Dec. 31 and are final; assets are through Nov. 30,
Management this spring. costs were taken into account, ac- research at HCWE Worldwide Eco- and include all share classes. All data are final.
Many experts recommend a small cording to the report. nomics, says one simple and inex- Assets Performance (%)
Fund Name Symbol ($ millions) Dec. 4th-qtr 1-yr 3-yr* 5-yr*
amount of commodity exposure for Part of the problem is that when pensive way to add commodities to
investors because commodity prices investors buy actual commodities, a portfolio is to purchase equal dol- Vanguard Tot Bd;Adm VBTLX 147,941.6 –0.4 –0.6 0.4 1.3 3.1
tend to be uncorrelated with those they typically have to pay for stor- lar weights of futures contracts in PIMCO:Tot Rtn;Inst PTTRX 91,977.8 –0.2 0.5 0.7 1.1 3.5
of stocks and bonds. That is, if age, which presents an additional crude oil, copper, soybeans and cot- Vanguard Tot Bd II;Inv VTBIX 91,413.8 –0.5 –0.7 0.3 1.3 3.0
stocks rally, commodity prices may obstacle to making money. So even if ton. His research, published in 2014, Met West:Total Return;I MWTIX 69,435.2 –0.3 –0.4 0.3 2.2 4.7
go up, down or simply not move at the price of a commodity remains looked at decades of data and found Templeton Gl Bond;Adv TGBAX 58,792.3 –3.1 2.3 –4.0 0.03 2.6
all. As a result, overall volatility in a stable, an investor will lose money that a simplified approach like this, Vanguard Sh-Tm Inv;Adm VFSUX 53,016.7 –0.4 –0.3 1.1 1.4 2.1
portfolio is reduced. due to storage and capital costs. This including annual rebalancing, didn’t PIMCO:Income;Inst PIMIX 52,388.5 –0.9 0.5 2.6 4.9 8.4
But the new findings may give is true even in the derivatives mar- compromise the goal of adding di- Vanguard Tot Itl BI;Inv VTIBX 51,290.2 –0.3 0.4 1.0 N.A. N.A.
DoubleLine:Tot Rtn;I DBLTX 51,071.9 –0.2 –0.5 2.3 3.0 5.5
some fund investors pause. ket where futures contracts trade at versification. A small investor could
Dodge & Cox Income DODIX 43,898.1 –0.8 0.1 –0.6 1.8 3.6
Unless alpha is positive and sta- different prices based on when they do this by buying exchange-traded
tistically significant, there aren’t expire, Prof. Kanuri explains. funds for each commodity. Vanguard Sh-Tm Bd;ETF BSV 42,037.0 –0.2 –0.6 0.9 0.8 1.5
grounds to say the fund manager is Funds buying futures tend to fare Lord Abbett Sh Dur;A LALDX 34,983.6 –0.6 –0.7 0.4 1.3 2.7
adding value, Prof. Kanuri said in an badly for other reasons, too. For ex- Mr. Constable is a writer in New iShares:Core US Agg Bd AGG 29,915.6 –0.3 –0.6 0.5 1.4 3.1
interview. The study found one ex- ample, the money they can make York who once worked in the American Funds Bond;A ABNDX 28,404.4 –0.6 –0.6 0.2 1.2 3.2
ception: During times of financial from negative bets is limited. commodity markets. He can be Fidelity Str Adv Cre Inc FPCIX 28,195.4 –0.7 –0.4 –0.02 1.2 3.5
distress, such as the stock-market “In a down market commodity reached at reports@wsj.com. *Annualized N.A.=not applicable, fund is too new
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. Monday, January 11, 2016 | R9
of Heartland Advisors in Mil- centage easy for small-cap value don’t get too depressed and How harmful (or not) Gib- and Mr. Smith currently man-
waukee, has managed the point. managers,” Mr. Nasgovitz sell everything. son Smith‘s exit proves to be age, some with other manag-
$848 million Heartland Despite a says. But he sees a bull mar- depends on the patience of ers, include the $9.2 billion
Value fund (HRTVX) for broad mar- ket ahead. Here are edited WSJ: When you look at this investors, how the fixed-in- Janus Flexible Bond, the
more than 30 years. ket that has excerpts from an interview. market, is anything truly dif- come team gels without him $280.7 million Janus Global
Since the fund’s inception worked ferent from the past? and the performance of Janus Bond, the $2 billion Janus
in 1984, it has generated an Bill Nasgovitz against his WSJ: You’ve lived with your MR. NASGOVITZ: The markets funds going forward. High-Yield, the $17.7 million
annualized average return of favored in- methodology for decades, are still driven by two ex- Mr. Smith, who joined Janus Real Return and the
11.75%, about a point ahead vestment style, Mr. Nasgov- through thick and thin. How tremes, fear and greed. Janus in 2001 as a fixed-in- $2.6 billion Janus Short-
of the Russell 2000 Value In- itz hasn’t changed his tune, important is it for investors Right now we have some come analyst, plans to leave Term Bond.
dex. But the fund has strug- staying focused on small to stick to their beliefs? greed going on, but the aver- March 31 to spend more time Chris Diaz, who joined the
gled against peers for about companies purchased at the MR. NASGOVITZ: Whatever age stock has been held back with his family. firm in 2011, will head global
by a fair amount of fear and “A lot of uncertainty is cre- fundamental fixed income.
derisking [selling or avoid- ated” by Mr. Smith’s depar- Mr. Diaz was most recently
Monitoring Money-Market Funds ing stocks perceived as be- ture, says Sumit Desai, an an- head of global rates and lead
Performance figures for these consumer-oriented funds are estimated annualized yields, which include ing volatile]. alyst at researcher portfolio manager of the
earnings from the funds’ investments and the effects of compounding. Funds open only to institutions, Morningstar Inc. He says Mr. Janus global multisector in-
WSJ: When you started your Smith effectively built Janus’s stitutional strategy and re-
special-purpose and tax-exempt funds are excluded from these tables.
fund, there were no Morning- fundamental fixed-income lated portfolios.
Largest Funds Highest 12-Month Yield star ratings or other mea- business while generating Mr. Siegenthaler predicts a
Compound Compound sures of funds. Investors strong long-term returns. muted reaction from clients—
Assets Performance (%) 7-day Assets Performance (%) 7-day bought and held for a long Under Mr. Smith, Janus’s less than 15% redemptions
Fund Name ($millions) 4th–qtr 12-mos yield (%) Fund Name ($millions) 4th–qtr 12-mos yield (%) time. Now, they tend to move assets under management in over 12 months—because of
Fidelity Govt Cash Resvs 116,335.4 0.01 0.01 0.01 Meeder MMF/Retail 54.4 0.08 0.07 N.A. around much more quickly. the fixed-income area ex- Janus’s strong bond track re-
Vanguard Prime MMF/Inv 109,432.3 0.12 0.05 0.26 Davis Govt MMF/Cl A 178.8 0.00 0.06 0.00 MR. NASGOVITZ: Over the panded from less than $1 bil- cord and the fact that Mr.
Schwab Cash Reserves 40,523.6 0.07 0.06 0.07 Schwab Cash Reserves 40,523.6 0.07 0.06 0.07 years, people seem to have lion before the financial crisis Watters co-managed most of
Schwab Govt MF/Sweep 23,095.0 0.00 0.00 0.00 Vanguard Prime MMF/Inv 109,432.3 0.12 0.05 0.26 morphed into short-term to nearly $42 billion today, the key funds with Mr. Gibson.
Fidelity Government MMF 22,092.5 0.01 0.01 0.01 HSBC Prime MMF/Cl A 27.5 0.05 0.04 0.05 speculators rather than long- Craig Siegenthaler, an analyst Todd Rosenbluth, director
Schwab US Treasury MF 20,694.0 0.00 0.00 0.00 Vanguard Federal MMF 4,733.2 0.10 0.04 0.21
term investors, zigging when with Credit Suisse, said in a of ETF and mutual-fund re-
Schwab Adv Cash Res/PSwp 18,211.7 0.01 0.01 0.01 Hewitt MMF/Admin Shares 767.8 0.04 0.03 0.15
they should be zagging. note. search at S&P Capital IQ,
We have a very low Morn- But both analysts note that agrees that Mr. Watters’s
Schwab Money Market Fund 15,142.8 0.01 0.01 0.01 HSBC US Govt MMF/Cl A 1.1 0.03 0.03 0.03
ingstar rating today [two Mr. Smith leaves behind a presence will be reassuring,
Federated Capital Res 14,464.7 0.00 0.00 0.00 PNC Government MMF/Cl A 336.7 0.03 0.03 N.A.
stars]; in the past we have strong team. “There’s a deep but recommends that inves-
Federated Govt Res/Cl P 13,331.3 0.00 0.00 0.00 PNC MMF/Cl A 145.6 0.04 0.03 N.A.
been up there with four or team, and they’re very capable tors keep on eye on whether
five stars and, in fact, had to investors,” says Mr. Desai. the funds’ investment ap-
Highest Seven-Day Yield Lowest 12-Month Yield* close the fund [to new inves- There will be no changes to proach, exposures and perfor-
Compound Compound
Assets Performance (%) 7-day Assets Performance (%) 7-day
tors] because of tremendous the funds’ investment pro- mance remain consistent.
Fund Name ($millions) 4th–qtr 12-mos yield (%) Fund Name ($millions) 4th–qtr 12-mos yield (%) demand twice in its history. cesses or philosophies, a —Daisy Maxey
When we lag, that’s usually
Vanguard Prime MMF/Inv 109,432.3 0.12 0.05 0.26 Schwab Govt MF/Sweep 23,095.0 0.00 0.00 0.00
the time to be taking a look
Vanguard Federal MMF 4,733.2 0.10 0.04 0.21 Schwab US Treasury MF 20,694.0 0.00 0.00 0.00
at a value fund, in my view, years of pain, I think value We should be able to find
BlackRock MMP/Inv A 331.0 0.03 0.01 0.15 Federated Capital Res 14,464.7 0.00 0.00 0.00
because we believe in regres- investors are due for seven companies that can find
Hewitt MMF/Admin Shares 767.8 0.04 0.03 0.15 Federated Govt Res/Cl P 13,331.3 0.00 0.00 0.00 sion to the mean. It has held years of feast. above-GDP growth even in a
Vanguard Treasury MMF 9,124.5 0.05 0.02 0.14 American Funds MMF/Cl A 12,159.5 0.00 0.00 0.00 up over the life of this fund, In this low-interest-rate slowdown—a Chinese slow-
Fidelity Money Market Fd 2,221.5 0.03 0.01 0.13 BIF Money Fund 5,188.3 0.00 0.00 0.00 and we think it will again. environment—we don’t think down and U.S. slow-growth
Gabelli US Treas/Cl AAA 1,518.9 0.02 0.01 0.12 SSgA MMF/Cl N 3,225.4 0.00 0.00 0.01 rates will go up much here— period. That’s the key that is
Schwab Cash Reserves 40,523.6 0.07 0.06 0.07 SSgA US Govt MMF/Cl N 2,864.3 0.00 0.00 0.00 WSJ: While you are optimis- growth is low, debt is high, going to drive money back
Wilmington Prime/Admin 318.2 0.03 0.02 0.07 Ready Assets Prime MF 2,120.3 0.00 0.00 0.00 tic that there will be a small- investors are looking for to this sector.
PIMCO Govt MMF/Cl A 9.4 0.01 0.01 0.06 Franklin US Govt MF/Cl A 1,932.2 0.00 0.00 0.00 cap rally, are you worried top-line growth, they are
Source: Money Fund Report (iMoneyNet.com) Average Yields (all retail taxable funds) 0.01% 0.01% about political or other risks looking for niches. Mr. Jaffe is a MarketWatch
changing things in 2016? To me, that points to the columnist. Email him at
*- Ranked by assets. A full list of 36 funds with 12-month yields of zero may be found at http://wsj.com/FundsAnalysis. MR. NASGOVITZ: After seven small and microcap sectors. cjaffe@marketwatch.com.
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R10 | Monday, January 11, 2016 THE WALL STREET JOURNAL.
Best– and worst–performing stock funds for the periods ended Dec. 31; assets as of Nov. 30 and include all share classes. Performance data are final and include share prices and reinvested dividends.
Fourth–Quarter Best Performers Fourth–Quarter Worst Performers Five–Year Best Performers Five–Year Worst Performers
Assets Performance (%) Assets Performance (%) Assets Performance (%) Assets Performance (%)
Fund Name ($ millions) Dec. 4th–qtr 1–year Fund Name ($ millions) Dec. 4th–qtr 1–year Fund Name ($ millions) 4th–qtr 1–year 5–year* Fund Name ($ millions) 4th–qtr 1–year 5–year*
VelShs 3x Inv Crude ETN 167.2 46.8 82.3 64.8 Direxion:Nat Gas Bull 3X 47.4 –59.7 –63.4 –97.1 ProShares:Ult Nasdaq Bio 779.7 22.0 13.8 57.0 VelShs Dly 2x VIX ST ETN 299.3 –50.7 –77.7 –84.3
VelShs 3x Inv Nat Gas 57.4 –21.9 57.2 48.6 VelShs 3x Long Crude ETN 1,037.1 –41.3 –61.6 –91.6 Direxion:Retail Bull 3X 67.1 21.5 44.5 54.3 C-Tracks ETN Citi Vol TR N.A. –48.5 –61.3 –77.4
DB Crude Oil Db Sht ETN N.A. 28.8 53.8 94.6 VelShs 3x Long Nat Gas 342.0 –4.5 –60.9 –87.1 ProShares:UltP QQQ 1,402.1 30.4 17.4 44.0 Direxion:Gold M Id Bl 3X 650.6 –16.0 –78.1 –73.5
ProShs II:UlS Blm CrO 123.1 32.0 52.2 70.8 ProShs II:UltVIX STF ETF 527.6 5.4 –50.9 –77.6 ProFunds:Biotech;Inv 636.4 15.5 3.1 42.2 Direxion:Nat Gas Bull 3X 47.4 –63.4 –97.1 –70.7
ProShs II:UlS Blm Nat Gs 11.4 –8.0 43.7 66.3 VelShs Dly 2x VIX ST ETN 299.3 5.5 –50.7 –77.7 ProShares:Ult Hlth Cr 146.3 16.3 8.0 39.1 VelShs Dly 2x VIX MT ETN 1.6 –32.2 –37.7 –56.1
DB Commodity Db Sht ETN N.A. 17.4 38.8 78.4 C-Tracks ETN Citi Vol TR N.A. 1.7 –48.5 –61.3 ProShares:Ult Cons Sv 30.0 10.2 9.2 34.4 ProShares:UlS Nasdaq Bio 100.4 –25.2 –37.5 –51.1
ProFunds:UltraChina;Inv 20.3 –3.2 31.6 –7.0 Direxion:S&P Btech Br 3X 39.9 1.3 –45.4 N.A. Fidelity Sel Bio Tech 15,086.8 12.8 13.7 32.6 Direxion:Semicnd Bear 3X 40.6 –31.5 –25.1 –49.6
ProShares:UP Nasdaq Bio N.A. 1.6 31.0 N.A. ProShs II:Ult Blm CrO 871.0 –28.9 –43.7 –75.2 Fidelity Adv Biotech;A 3,779.3 11.1 11.1 31.7 Direxion:Latin Bull 3X 9.0 –18.1 –74.9 –49.5
ProShares:UltP QQQ 1402.1 –5.5 30.4 17.4 iPath Bloomberg NatGas A 5.4 0.9 –42.1 –63.3 Direxion:M NAS Bl 2x;Inv 154.9 19.4 14.4 31.5 VelShs VIX ShTm ETN 8.8 –23.0 –36.6 –49.4
Direxion:Semicnd Bull 3X 132.0 –6.8 29.6 –20.7 ProShs II:Ult Blm Nat Gs 33.8 –1.7 –42.0 –69.9 ProShares:Ult QQQ 1,039.0 20.2 14.7 31.1 iPath ETN SP500 VIX ST A 806.7 –23.0 –36.6 –49.4
Direxion:S&P Btech Bl 3X 163.8 –10.9 29.5 N.A. ProShares:UPS Nasdaq Bio 10.0 –7.6 –37.2 N.A. Rydex:NASDAQ 2x;H 330.7 19.9 13.7 30.0 ProShares:UltP Sht QQQ 417.4 –28.4 –37.5 –48.2
Direxion:CSI300 ChA Bl2X 66.5 4.4 29.1 N.A. Highland:Energy MLP;Y 39.0 –19.4 –37.1 –54.8 ProFunds:UltraNASDAQ;Inv 267.4 19.9 13.7 30.0 ProShs II:Ult Blm CrO 871.0 –43.7 –75.2 –45.0
KraneShs:CSI China Intrt 153.5 –0.9 28.8 17.8 Direxion:Gold M Id Br 3X 209.7 –12.6 –33.5 –33.5 ProShares:UltPro S&P500 1,085.9 20.0 –5.1 30.0 Direxion:RE Bear 3X 10.7 –22.3 –24.8 –44.2
PowerShares Gldn DrgnChi 183.3 1.3 27.8 18.2 Direxion:S&P OG EP Bl 3X 9.8 –49.4 –33.0 N.A. iShares:Nasdaq Biotech 8,426.5 11.8 11.5 29.6 Direxion:Finl Bear 3X 313.5 –19.9 –19.0 –44.1
United States Short Oil 21.1 15.3 26.7 45.9 VelShs Dly 2x VIX MT ETN 1.6 –1.3 –32.2 –37.7 Direxion:S&P 500 Bull 3X 616.0 19.9 –5.5 28.4 Direxion:Sm Cap Bear 3X 416.4 –15.4 –6.8 –43.1
Deutsche Hvst CSI500 ChA 35.9 1.4 26.5 28.7 US Diesel-Heating Oil 3.1 –19.7 –31.9 –42.0 ProFunds:Health Care;Inv 58.9 12.2 6.4 28.2 ProShares:Ult MSCI Braz N.A. –10.0 –69.6 –43.1
Direxion:Hlthcre Bull 3X 328.7 4.1 26.2 7.6 Direxion:Semicnd Bear 3X 40.6 4.0 –31.5 –25.1 Rydex:Biotechnology;Inv 627.3 10.1 8.8 27.9 ProShares:UltPSh Rus2000 65.2 –15.1 –5.4 –42.4
Direxion:Tech Bull 3X 191.4 –6.7 25.8 4.8 iPath ETN S&P GSCI CTR A 768.8 –19.1 –30.6 –53.4 SPDR S&P Biotech 2,295.1 13.0 13.6 27.8 Direxion:Tech Bear 3X 18.5 –26.2 –31.4 –42.1
DB Crude Oil Short ETN N.A. 14.4 25.7 50.9 Yorkville Hi Inc MLP ETF 124.0 –25.0 –29.3 –57.0 Franklin Str:BD;A 1,682.0 9.9 5.5 27.3 iPath Bloomberg NatGas A 5.4 –42.1 –63.3 –41.5
Guggenhm China Tech ETF 57.9 –1.4 24.9 6.8 ProFunds:UlSh China;Inv 2.6 1.3 –29.1 –23.1 T Rowe Price Hlth Sci 14,107.6 7.4 13.0 27.0 Direxion:S&P 500 Bear 3X 314.7 –21.5 –18.1 –40.1
ProShares:Ult Semicond 26.9 –3.5 24.9 –8.3 DB Commodity Db Lng ETN N.A. –15.9 –28.8 –53.3 ProShares:UltP Dow30 177.9 22.3 –8.4 26.9 ProShares:UltPSh MdCp400 5.2 –10.7 –7.4 –40.0
EMQQ EM Intrt & Ecom ETF 12.1 –1.3 23.8 5.2 ProShares:UltP Sht QQQ 417.4 2.6 –28.4 –37.5 Direxion:Tech Bull 3X 191.4 25.8 4.8 26.8 Direxion:MidCapBear 3X 12.7 –10.9 –8.1 –39.6
Mrkt Vctrs:ChinaAMC SME 58.1 0.5 22.9 45.9 iPath Bloomberg Energy A 1.0 –13.1 –27.4 –45.3 PowerShares Dyn Pharm 1,663.5 9.0 9.3 26.6 ProShares:Ul PrSh S&P500 554.0 –21.2 –16.8 –39.5
ProShs II:UlS Blm Comm 8.1 5.7 22.7 61.7 Direxion:Tech Bear 3X 18.5 3.8 –26.2 –31.4 Pru Jenn Health Sci;A 3,412.9 5.1 5.0 25.6 ProFunds:Prec Metals;Inv 13.9 –0.3 –48.3 –39.0
ProShares:UltP Dow30 177.9 –5.5 22.3 –8.4 United States Brent Oil 83.0 –17.6 –26.2 –45.4 ProShares:Ult Cons Gd 20.8 12.0 8.4 25.2 ProShs II:Ult Silver 214.8 –12.8 –31.3 –38.7
ProShares:Ult Nasdaq Bio 779.7 1.7 22.0 13.8 ProShares:UlS Nasdaq Bio 100.4 –4.5 –25.2 –37.5 VelShs DlyInv VIX MT ETN 108.1 11.5 –0.9 25.1 ProShares:UlS Hlth Cr 4.3 –17.7 –21.3 –36.7
Direxion:Retail Bull 3X 67.1 –2.1 21.5 44.5 United States Nat Gas 513.5 –0.6 –25.1 –40.6 iPath ETN LgEx S&P 2.0 11.4 1.3 25.1 ProShares:UltP Sht Dow30 153.2 –22.5 –13.9 –36.3
iShares:MSCI New Z Cp 68.2 7.6 20.6 –1.3 United States Oil Fund 3,291.8 –14.8 –24.4 –45.3 ProFunds:Pharmaceut;Inv 17.7 12.9 5.8 25.0 Direxion:China Bear 3X 57.3 –12.9 –13.0 –35.9
iPath Bloomberg Sugar A 61.6 2.2 20.3 –5.8 MainStay:Cushing REI;A 102.8 –20.0 –24.0 –56.5 Janus Glbl Life Sci;T 4,735.7 4.8 8.2 24.9 ProFunds:UltraLatin;Inv 12.0 –12.7 –61.8 –35.3
Direxion:Pharma&Med Bl2X 3.6 0.2 20.2 N.A. ProShares:UlS Semicond 3.1 2.3 –23.6 –13.6 iPath ETN LgEx Rus 1000 1.3 10.5 0.4 24.7 ProShares:UlS Cons Sv 2.6 –11.9 –19.0 –34.5
Glbl X China NASDTch ETF 16.3 –0.9 20.2 8.8 ProShs II:VIX ST Fut ETF 102.3 6.4 –23.3 –36.7 ProFunds:Cnsmr Svcs;Inv 54.2 7.6 6.8 24.7 ProFunds:UltSh NAS;Inv 12.4 –19.7 –25.5 –34.3
ProShares:Ult QQQ 1,039.0 –3.4 20.2 14.7 Direxion:Brazil Bull 3X 38.3 –22.8 –23.2 –86.9 DB Crude Oil Db Sht ETN N.A. 53.8 94.6 24.5 ProFunds:UltSh Japan;Inv 1.4 –14.4 –27.5 –34.2
ProShares:UltPro S&P500 1,085.9 –5.7 20.0 –5.1 Direxion:Jr Mnr Bear 3X 53.9 –14.5 –23.1 –52.7 ProShs II:UlS Blm Comm 8.1 22.7 61.7 24.2 Rydex:Inv NAS 2x;H 34.3 –20.0 –25.3 –34.1
ProFunds:UltraNASDAQ;Inv 267.4 –3.6 19.9 13.7 VelShs VIX ShTm ETN 8.8 6.6 –23.0 –36.6 Frst Tr:NYSEArcaBiotech 3,387.9 11.4 11.0 23.7 Direxion:M LA Bl 2x;Inv 4.5 –10.8 –57.8 –34.0
Direxion:S&P 500 Bull 3X 616.0 –5.7 19.9 –5.5 iPath ETN SP500 VIX ST A 806.7 6.6 –23.0 –36.6 Fidelity Sel Health 8,994.6 9.7 6.6 23.7 Glbl X Uranium ETF 130.0 3.5 –36.6 –33.9
Rydex:NASDAQ 2x;H 330.7 –3.5 19.9 13.7 Catalyst MLP&Infr;A 15.1 –18.4 –22.9 –45.7 Hartfd:Healthcare HLS;IA 844.0 11.4 13.2 23.5 Midas Fund 10.6 –6.6 –28.3 –33.8
iShares:MSCI Indonesia 258.9 5.0 19.8 –22.0 Direxion:Pharma&Med Br2X 4.1 –2.4 –22.8 N.A. Fidelity Adv Hlth;A 3,080.6 9.0 6.0 23.0 ProShares:UlS QQQ 346.4 –19.5 –24.7 –33.8
Mrkt Vctrs:Solr Enrgy 16.7 12.0 19.6 –8.1 ProShares:UltP Sht Dow30 153.2 3.0 –22.5 –13.9 Direxion:RE Bull 3X 101.2 19.4 –4.3 22.8 Glbl X Gold Explrs ETF 26.5 1.1 –12.3 –33.4
Rydex:MR NASDAQ-100 2S;H 6.1 –3.2 19.5 22.5 Direxion:RE Bear 3X 10.7 –6.9 –22.3 –24.8 DB Commodity Db Sht ETN N.A. 38.8 78.4 22.7 Frst Tr II:Indxx Gl Agri 4.9 –20.0 –56.0 –33.3
Direxion:M NAS Bl 2x;Inv 154.9 –3.2 19.4 14.4 iPath ETN P Beta Energy 1.4 –13.7 –21.6 –39.4 ProFunds:Internet;Inv 110.4 19.1 30.8 22.6 Mrkt Vctrs:Jr Gld Miners 1,213.4 –1.2 –19.5 –32.9
Direxion:RE Bull 3X 101.2 4.5 19.4 –4.3 Direxion:S&P 500 Bear 3X 314.7 3.1 –21.5 –18.1 Hartfd:Healthcare;A 1,695.8 11.0 12.7 22.4 ProShares:UlS Semicond 3.1 –23.6 –13.6 –31.7
ProFunds:Internet;Inv 110.4 –3.4 19.1 30.8 Dunham:Lg Cap Value;N 57.1 –27.0 –21.4 –27.0 iShares:US Pharma ETF 866.9 10.3 8.8 22.2 Mrkt Vctrs:Coal 47.3 –17.7 –55.1 –31.5
WisdomTree:Jpn Hgd HC 19.2 1.1 18.9 39.0 ProShares:Ul PrSh S&P500 554.0 3.2 –21.2 –16.8 ProShares:UlS MSCI Brz 32.7 –1.8 98.7 22.0 Mrkt Vctrs:Rare E/SM ETF 33.9 –4.2 –43.6 –30.1
ProShares:Ult Bas Mat 53.6 –8.9 18.8 –27.4 UBS E-TRACS CMCI Engy TR 3.2 –12.9 –20.8 –37.5 ProShares:Ultra S&P500 1,901.8 13.5 –1.1 21.9 VelShs VIX MdTm ETN 0.6 –15.4 –15.0 –30.0
Direxion:Japan Bull 3X 14.4 –5.4 18.7 14.4 ProShs II:Ult Blm Comm 7.6 –6.5 –20.7 –45.5 Direxion:M S&P Bl 2x;Inv 68.6 13.1 –1.4 21.9 iPath ETN SP500 VIX MT A 53.1 –15.4 –15.0 –30.0
iPath ETN P Beta Sugar 1.5 3.4 18.7 –12.9 Rydex:Inv NAS 2x;H 34.3 1.7 –20.0 –25.3 Vanguard Health Care;Adm 51,725.5 8.7 12.7 21.7 Direxion:EmgMk Bull 3X 168.8 –4.6 –49.9 –29.9
DB Commodity Short ETN N.A. 8.7 18.5 36.3 Frst Tr II:Indxx Gl Agri 4.9 –12.3 –20.0 –56.0 PowerShares S&P SC H Cre 252.2 10.5 20.3 21.7 ProShares:UlS SC600 4.2 –9.6 –4.9 –29.8
ProFunds:Semiconduct;Inv 19.1 –2.6 18.3 –5.5 ProShares:UlS Bas Mat 17.3 7.2 –19.9 15.8 SPDR S&P Pharm 717.6 16.4 1.6 21.5 United States Nat Gas 513.5 –25.1 –40.6 –29.0
WisdomTree:China x-S-O 10.1 –1.2 18.2 –1.4 Direxion:Finl Bear 3X 313.5 4.2 –19.9 –19.0 ProShs II:UlS Blm CrO 123.1 52.2 70.8 21.2 DB Commodity Db Lng ETN N.A. –28.8 –53.3 –28.8
Eventide Hlthcare & LS;A 401.1 –3.3 17.5 14.9 Frst Tr:ISE Rev Nat Gas 208.4 –22.2 –19.8 –59.1 Direxion:MidCapBull 3X 73.1 5.5 –14.7 21.1 ProShares:UlS Finl 49.7 –12.7 –8.6 –28.8
Guggenhm Solar ETF 237.0 17.6 17.1 –9.4 Nvgtr Sentry Mgd Vol;I 20.2 2.0 –19.8 –27.2 BlackRock:HS Opp;A 6,080.6 8.4 11.0 20.9 ProFunds:UltSh Sm-Cp;Inv 8.7 –9.7 –2.1 –28.8
Mrkt Vctrs:Indonesia Idx 85.5 3.4 17.0 –22.6 iPath ETN P Beta CrdeOil 7.2 –13.1 –19.8 –40.4 Deutsche H&W;S 391.9 7.8 6.9 20.6 ProShares:UlS Tech 6.7 –17.3 –17.5 –28.7
Leland TR VNCP Idx;I 12.6 –0.3 17.0 16.4 ProShares:UlPS Fin Sel 4.3 3.8 –19.8 –16.8 Rydex:S&P 500 2x;H 126.7 13.3 –2.0 20.6 Direxion:DevMk Bear 3X 11.3 –12.4 –14.1 –28.4
KraneShs:CSI New China 3.2 –3.7 16.6 –0.5 ProFunds:UltSh NAS;Inv 12.4 1.8 –19.7 –25.5 Guggenhm S&P500 Eq W HC 550.3 9.4 8.2 20.4 Rydex:Inv Rus 2x;H 36.1 –9.6 –1.6 –28.4
PowerShares WldHill CE 104.2 10.9 16.6 –8.6 PowerShares DB MS Oil 474.3 –13.2 –19.6 –41.5 Vanguard Hlth Cr Idx;ETF 6,548.2 8.8 7.2 20.4 ProFunds:UltraBear;Inv 15.2 –14.5 –10.0 –28.1
ProShares:Ult Tech 147.2 –5.6 16.5 2.9 DB Crude Oil Long ETN N.A. –13.5 –19.6 –41.3 ProShares:UltP MidCap400 39.5 5.6 –14.3 20.3 ProShares:UlS Indust 5.2 –14.8 –5.0 –28.1
SPDR S&P Pharm 717.6 1.3 16.4 1.6 ProShares:UlS QQQ 346.4 2.0 –19.5 –24.7 Direxion:Finl Bull 3X 1,392.7 15.4 –8.5 20.2 ProShares:UlS Rus2000 168.3 –9.6 –1.0 –27.9
ProShares:Ult Hlth Cr 146.3 2.3 16.3 8.0 iPath ETN S&P GSCI TR A 59.4 –10.2 –19.5 –37.4 ProFunds:UltraBull;Inv 64.2 13.2 –2.1 20.2 ProShs II:Ult Blm Comm 7.6 –20.7 –45.5 –27.9
Catalyst Macro Strat;I 149.9 –1.9 16.3 49.8 VelShs 3x Long Silver 105.0 –8.0 –19.3 –47.5 Sel Sector:H Care SPDR 13,696.6 9.1 6.8 20.1 ProFunds:UltSh Md-Cp;Inv 2.0 –7.3 –5.0 –27.7
SPDR S&P Semiconductor 203.2 –3.0 16.0 10.3 ProShares:ULT O&G Ex&Pr N.A. –34.9 –19.0 N.A. ProShares:Ult Tech 147.2 16.5 2.9 20.0 Rydex:Inv S&P 2x;H 48.6 –14.5 –10.1 –27.6
PowerShares NASD Intrt 281.4 –1.8 15.9 19.4 ProShares:UlS Gold Minrs 1.5 –6.9 –18.6 N.A. iShares:US Hlthcr ETF 1,933.4 8.4 6.1 19.9 ProShares:UlS Cons Gd 2.5 –13.1 –17.2 –27.5
ProFunds:Biotech;Inv 636.4 2.2 15.5 3.1 Advisory Rsrch MLP&Eq;I 8.0 –16.6 –18.5 N.A. Fidelity Sel Retailing 1,894.0 7.9 18.4 19.8 US Glbl:Wld Prec Min 77.2 2.5 –15.6 –27.2
T Rowe Price Glbl Tech 2,622.6 –0.6 15.4 21.1 Direxion:Hbldrs&Sup Br3X 3.9 12.8 –18.4 N.A. T Rowe Price Glbl Tech 2,622.6 15.4 21.1 19.8 ProShares:UlS Rl Est 32.2 –14.8 –12.0 –27.1
Direxion:Finl Bull 3X 1,392.7 –7.7 15.4 –8.5 Direxion:Latin Bull 3X 9.0 –17.8 –18.1 –74.9 Fidelity Sel Pharm 2,031.8 6.1 8.2 19.7 ProShares:Ul Sht S&P500 1,517.9 –14.3 –9.6 –26.9
Matthews Asia:Sc&Tc;Inv 166.8 –1.5 15.3 4.5 PowerShares DB MS Engy 108.1 –11.2 –17.8 –34.9 Schwab Cap:Health Care 1,110.9 7.1 8.4 19.6 ProShares:UlS MC400 7.7 –6.8 –3.1 –26.6
One–Year Best Performers One–Year Worst Performers Ten–Year Best Performers Ten–Year Worst Performers
Assets Performance (%) Assets Performance (%) Assets Performance (%) Assets Performance (%)
Fund Name ($ millions) Dec. 4th–qtr 1–year Fund Name ($ millions) Dec. 4th–qtr 1–year Fund Name ($ millions) 4th–qtr 1–year 10–year* Fund Name ($ millions) 4th–qtr 1–year 10–year*
ProShares:UlS MSCI Brz 32.7 12.1 –1.8 98.7 Direxion:Nat Gas Bull 3X 47.4 –59.7 –63.4 –97.1 ProFunds:Biotech;Inv 636.4 15.5 3.1 18.5 Direxion:M SC Br 2x;Inv 7.9 –9.5 –0.3 –34.2
DB Crude Oil Db Sht ETN N.A. 28.8 53.8 94.6 VelShs 3x Long Crude ETN 1,037.1 –41.3 –61.6 –91.6 PowerShares Dyn Pharm 1,663.5 9.0 9.3 17.1 ProFunds:UltSh NAS;Inv 12.4 –19.7 –25.5 –29.7
ProFunds:UltSh Latin;Inv 10.2 12.6 5.3 86.6 VelShs 3x Long Nat Gas 342.0 –4.5 –60.9 –87.1 Fidelity Sel Bio Tech 15,086.8 12.8 13.7 16.9 Rydex:Inv NAS 2x;H 34.3 –20.0 –25.3 –29.2
DB Commodity Db Sht ETN N.A. 17.4 38.8 78.4 Direxion:Brazil Bull 3X 38.3 –22.8 –23.2 –86.9 T Rowe Price Hlth Sci 14,107.6 7.4 13.0 16.8 ProFunds:UltSh Sm-Cp;Inv 8.7 –9.7 –2.1 –29.1
ProShs II:UlS Blm CrO 123.1 32.0 52.2 70.8 Direxion:Gold M Id Bl 3X 650.6 –4.8 –16.0 –78.1 Fidelity Adv Biotech;A 3,779.3 11.1 11.1 16.2 ProFunds:UltSh Md-Cp;Inv 2.0 –7.3 –5.0 –26.5
ProShs II:UlS Blm Nat Gs 11.4 –8.0 43.7 66.3 VelShs Dly 2x VIX ST ETN 299.3 5.5 –50.7 –77.7 iShares:Nasdaq Biotech 8,426.5 11.8 11.5 16.1 ProFunds:UltraBear;Inv 15.2 –14.5 –10.0 –22.2
VelShs 3x Inv Crude ETN 167.2 46.8 82.3 64.8 ProShs II:UltVIX STF ETF 527.6 5.4 –50.9 –77.6 Pru Jenn Health Sci;A 3,412.9 5.1 5.0 15.8 ProFunds:UltSh Dow30;Inv 4.4 –15.5 –8.5 –21.8
ProShs II:UlS Blm Comm 8.1 5.7 22.7 61.7 ProShs II:Ult Blm CrO 871.0 –28.9 –43.7 –75.2 Rydex:Biotechnology;Inv 627.3 10.1 8.8 15.3 Rydex:Inv S&P 2x;H 48.6 –14.5 –10.1 –21.7
DB Base Metals Db Sh ETN N.A. –6.4 12.3 61.1 Direxion:Latin Bull 3X 9.0 –17.8 –18.1 –74.9 Rydex:NASDAQ 2x;H 330.7 19.9 13.7 15.2 Rydex:Inv Dow 2x;H 29.2 –15.6 –8.8 –21.0
DB Crude Oil Short ETN N.A. 14.4 25.7 50.9 Direxion:Jr Mnr Bull 3X 112.6 1.7 –17.1 –74.4 ProFunds:UltraNASDAQ;Inv 267.4 19.9 13.7 15.1 ProFunds:Prec Metals;Inv 13.9 –0.3 –48.3 –19.6
Catalyst Macro Strat;I 149.9 –1.9 16.3 49.8 ProShs II:Ult Blm Nat Gs 33.8 –1.7 –42.0 –69.9 Franklin Str:BD;A 1,682.0 9.9 5.5 15.0 ProFunds:Sh Real Est;Inv 3.5 –7.7 –6.6 –17.6
VelShs 3x Inv Nat Gas 57.4 –21.9 57.2 48.6 ProShares:Ult MSCI Braz N.A. –12.0 –10.0 –69.6 ProFunds:Internet;Inv 110.4 19.1 30.8 14.8 ProFunds:Sh NASDAQ;Inv 5.1 –10.4 –14.5 –14.8
Mrkt Vctrs:ChinaAMC SME 58.1 0.5 22.9 45.9 Direxion:Russia Bear 3x 54.5 25.4 –7.9 –67.0 T Rowe Price Glbl Tech 2,622.6 15.4 21.1 14.3 Rydex:Inv NAS Str;Inv 69.2 –10.2 –11.9 –13.6
United States Short Oil 21.1 15.3 26.7 45.9 iPath Bloomberg NatGas A 5.4 0.9 –42.1 –63.3 Fidelity Sel SW & IT Svc 3,277.9 12.6 10.5 14.1 ProFunds:Mobile Tel;Inv 4.0 –2.2 7.9 –13.1
Direxion:Retail Bull 3X 67.1 –2.1 21.5 44.5 ProFunds:UltraLatin;Inv 12.0 –13.7 –12.7 –61.8 Fidelity Sel Retailing 1,894.0 7.9 18.4 14.0 ProFunds:Sh Sm-Cap;Inv 11.8 –4.8 –0.6 –12.9
Direxion:EnergyBear 3X 60.8 32.1 –10.5 39.6 C-Tracks ETN Citi Vol TR N.A. 1.7 –48.5 –61.3 BlackRock:HS Opp;A 6,080.6 8.4 11.0 14.0 Midas Fund 10.6 –6.6 –28.3 –12.8
WisdomTree:Jpn Hgd HC 19.2 1.1 18.9 39.0 Direxion:EnergyBull 3X 476.8 –30.6 –8.5 –61.2 Fidelity Sel IT Svcs 2,093.9 5.2 13.1 13.8 Rydex:Cmdty Str;H 13.6 –17.4 –34.6 –12.6
DB Commodity Short ETN N.A. 8.7 18.5 36.3 Frst Tr:ISE Rev Nat Gas 208.4 –22.2 –19.8 –59.1 T Rowe Price Media/Tele 3,614.3 10.8 12.0 13.7 Rydex:Inv Rus 2000 Str;H 21.9 –4.8 0.1 –12.2
ProShares:UlS OIl Gas 39.5 21.4 –5.4 34.6 Direxion:M LA Bl 2x;Inv 4.5 –11.8 –10.8 –57.8 Fidelity Sel Health 8,994.6 9.7 6.6 13.6 ProFunds:Banks;Inv 25.0 8.5 –1.8 –11.5
UBS E-TRACS 1xMo SA MLP 5.8 2.0 –0.5 34.5 Yorkville Hi Inc MLP ETF 124.0 –25.0 –29.3 –57.0 Janus Glbl Life Sci;T 4,735.7 4.8 8.2 13.5 Oppenheimer Com S TR;A 270.0 –11.6 –27.7 –11.4
ProFunds:Internet;Inv 110.4 –3.4 19.1 30.8 MainStay:Cushing REI;A 102.8 –20.0 –24.0 –56.5 Fidelity Sel Pharm 2,031.8 6.1 8.2 13.5 ProFunds:Sh Oil&Gas;Inv 5.0 –2.0 18.1 –11.4
iPath ETN ShEn MSCI EM 1.7 3.4 –2.2 29.4 Frst Tr II:Indxx Gl Agri 4.9 –12.3 –20.0 –56.0 Brown Cap Sm Co;Inv 2,796.9 9.2 8.8 13.0 Rydex:Inv Md-Cp Str;H 22.6 –3.4 –1.0 –11.3
Deutsche Hvst CSI500 ChA 35.9 1.4 26.5 28.7 UBS E-TRACS 2x LL Al MLP 220.2 –4.3 –5.4 –55.9 Fidelity Adv Hlth;A 3,080.6 9.0 6.0 12.9 PowerShares WldHill CE 104.2 16.6 –8.6 –10.5
DB Base Metals Short ETN N.A. –3.2 6.2 28.3 Mrkt Vctrs:Coal 47.3 –11.8 –17.7 –55.1 Hartfd:Healthcare HLS;IA 844.0 11.4 13.2 12.7 Comstock Cap Val;A 42.4 –7.5 –4.7 –10.3
ALPS Medical Break 170.8 –1.5 13.7 28.1 Highland:Energy MLP;Y 39.0 –19.4 –37.1 –54.8 PRIMECAP:Odyssey Ag Gr 6,664.3 10.9 4.6 12.7 ProFunds:Rs Rt Opp;Inv 61.8 1.9 –1.5 –10.2
DB Agriculture DS ETN N.A. 0.6 3.6 27.6 iPath ETN S&P GSCI CTR A 768.8 –19.1 –30.6 –53.4 ProFunds:Health Care;Inv 58.9 12.2 6.4 12.6 Leuthold:Grizzly Short 234.4 –7.9 3.8 –10.1
Direxion:EmgMk Bear 3X 116.5 10.0 –6.5 25.3 DB Commodity Db Lng ETN N.A. –15.9 –28.8 –53.3 Vanguard Health Care;Adm 51,725.5 8.7 12.7 12.5 Direxion:M EM Bl 2x;Inv 3.0 –1.8 –34.5 –10.0
Columbia:AbsRtn C&I;I 56.7 1.0 11.5 24.3 Direxion:Jr Mnr Bear 3X 53.9 –14.5 –23.1 –52.7 Alger II:Spectra;A 5,715.1 10.6 9.1 12.4 ProFunds:Bear;Inv 27.3 –7.3 –4.9 –9.9
VelShs 3x Inverse Gold 20.0 –0.1 12.6 22.8 SPDR S&P Metals&Mining 231.7 –6.1 –9.8 –50.5 Oberweis:China Opps 117.7 12.3 –2.2 12.4 Newmark Risk-Mgd Opp 6.2 3.4 –19.2 –9.7
LoCorr:Lng/Sh Comm Str;I 45.6 6.7 11.1 22.6 Direxion:China Bull 3X 153.1 –12.0 0.3 –50.5 ProFunds:Pharmaceut;Inv 17.7 12.9 5.8 12.0 Rydex:Inv S&P500 Str;Inv 122.3 –7.4 –4.4 –9.4
Rydex:MR NASDAQ-100 2S;H 6.1 –3.2 19.5 22.5 Direxion:EmgMk Bull 3X 168.8 –12.2 –4.6 –49.9 Fidelity Sel Chemicals 1,201.4 12.9 –5.1 11.9 Rydex:Precious Metls;Inv 31.3 –0.4 –30.5 –8.2
ProFunds:UltSh EM;Inv 9.2 7.2 –12.3 21.8 iShares:MSCI Brz Sm-Cap 25.5 –3.7 –0.9 –49.4 Hartfd:Healthcare;A 1,695.8 11.0 12.7 11.9 Direxion:M NR Bl 2X;Inv 5.2 –6.7 –47.5 –7.3
Frst Tr:DJ Internet Idx 4,810.6 –2.1 12.9 21.8 Mrkt Vctrs:Brazil Sm Cap 71.5 –5.2 1.7 –48.9 Eaton Vance AC SMID;I 6,705.3 7.4 9.7 11.9 Deutsche Gold&Prec;S 70.3 0.5 –26.7 –7.0
Rydex:Inv EM 2x Str;H 10.5 7.3 –11.9 21.2 ProFunds:Prec Metals;Inv 13.9 –2.7 –0.3 –48.3 Fidelity OTC 13,453.9 13.3 10.9 11.8 ProFunds:UltraJapan;Inv 57.3 11.4 8.4 –6.9
T Rowe Price Glbl Tech 2,622.6 –0.6 15.4 21.1 PowerShares S&P SC Enrgy 38.4 –17.6 –3.7 –47.7 Deutsche H&W;S 391.9 7.8 6.9 11.8 Nysa Srs Tr:Nysa Fund 1.9 2.9 –5.1 –6.7
iShares:MSCI Denmark Cp 71.8 2.2 6.7 21.0 VelShs 3x Long Silver 105.0 –8.0 –19.3 –47.5 Fidelity Sel Med Equip 2,014.6 9.6 7.1 11.6 US Glbl:Wld Prec Min 77.2 2.5 –15.6 –6.7
ProShares:UlS MSCI EM 72.1 6.7 –3.7 20.9 Direxion:M NR Bl 2X;Inv 5.2 –21.9 –6.7 –47.5 Parnassus:Endeavor 1,398.4 6.5 3.3 11.6 Federated Prudent Bear;A 337.2 –5.7 –4.5 –6.7
Matthews Asia:Japan;Inv 1,760.5 –0.4 10.4 20.8 Glbl X Copper Miners ETF 17.5 –4.2 –5.4 –46.7 PowerShares QQQ Trust 1 43,058.5 10.2 9.5 11.6 Crdt Suis Cmdty Rtn;Inst 4,040.3 –10.3 –25.0 –6.5
Burnham Inv:Fnl Svc;A 199.8 –2.3 10.0 20.4 ProFunds:OE S&D US;Inv 6.8 –22.9 –16.7 –46.6 Shelton:Nasdaq-100;Dir 278.9 10.0 9.2 11.6 Vanguard Prc M&M;Inv 1,551.5 –5.6 –29.4 –6.0
PowerShares S&P SC H Cre 252.2 –0.4 10.5 20.3 iPath Bloomberg Nickel A 5.7 –1.3 –17.7 –46.5 PowerShares Dyn Biotch 428.2 11.1 2.0 11.5 Amer Cent:Gl Gold;Inv 241.5 1.2 –22.8 –5.9
iShares:MSCI Ireland Cp 170.0 2.0 7.5 19.9 Frst Tr II:Indxx Gl NR I 12.4 –9.3 –10.8 –45.8 Delaware Pld:Foc Smid Gr 53.2 6.1 7.4 11.5 ProFunds:Financials;Inv 17.9 7.7 –3.2 –5.7
ProShs II:UlS Gold 81.1 –0.4 8.3 19.9 Catalyst MLP&Infr;A 15.1 –18.4 –22.9 –45.7 ProFunds:Cnsmr Svcs;Inv 54.2 7.6 6.8 11.5 FIDELITY Sel Cns Fin 109.7 –0.8 –5.0 –5.7
PowerShares NASD Intrt 281.4 –1.8 15.9 19.4 DB Base Met Db Long ETN N.A. 6.4 –13.7 –45.6 Alger Inst:Cap Apprec;I 3,903.2 14.2 12.1 11.5 ProFunds:Rs Rt Op 10;Inv 21.1 1.0 –3.3 –5.5
ProShares:Sht Oil & Gas 13.3 10.7 –1.8 19.2 ETFis InfraCap MLP 19.5 –11.2 –13.6 –45.6 Janus Triton;T 6,985.9 6.1 1.2 11.5 BlackRock:En & Res;A 267.1 –10.1 –38.4 –5.4
Fidelity Sel Retailing 1,894.0 –1.7 7.9 18.4 ProShs II:Ult Blm Comm 7.6 –6.5 –20.7 –45.5 Berkshire:Focus N.A. 8.6 13.3 11.4 US Glbl:Em Europe 48.5 –3.5 –20.7 –5.3
PowerShares Gldn DrgnChi 183.3 1.3 27.8 18.2 United States Brent Oil 83.0 –17.6 –26.2 –45.4 Clough China;I 72.1 2.3 –9.2 11.4 PIMCO:Comm RR Str;Inst 6,988.1 –10.7 –25.7 –5.0
Morg Stan I:Gl Opp;A 224.6 –1.3 10.5 18.2 United States Oil Fund 3,291.8 –14.8 –24.4 –45.3 Eaton Vance Ww H&S;A 1,707.1 10.1 8.4 11.3 Fidelity Sel Gold 806.0 0.3 –17.9 –4.6
ProFunds:Sh Oil&Gas;Inv 5.0 10.6 –2.0 18.1 iPath Bloomberg Energy A 1.0 –13.1 –27.4 –45.3 Saratoga:Tech&Comm;I 43.0 7.6 5.4 11.3 T Rowe Price Int:Em Euro 160.6 1.5 –10.1 –4.5
Turner Med Sci L/S;Inv 137.5 –2.3 –2.1 18.0 Salient MLP & En Infr;I 1,266.7 –14.9 –17.8 –44.0 Kinetics:Medical;NL 29.1 7.9 6.6 11.3 PIMCO:Stk+ Short;Inst 2,381.4 –5.8 –5.5 –4.2
KraneShs:CSI China Intrt 153.5 –0.9 28.8 17.8 ProShares:Ult Oil & Gas 126.3 –20.9 –3.6 –43.9 Alger:Capital Apprec;A 2,606.1 11.6 9.7 11.2 Rydex:Banking;Inv 29.4 1.9 –4.9 –4.2
WisdomTree:Jpn SC Div 358.2 0.9 8.5 17.7 Mrkt Vctrs:Rare E/SM ETF 33.9 –7.8 –4.2 –43.6 Vanguard Cnsmr Stp;ETF 2,938.3 7.2 6.0 11.2 US Glbl:Global Res 105.9 3.6 –28.4 –4.0
ETFis BioSh Biotech Prod 23.7 –2.6 11.4 17.6 Eagle MLP Strategy;I 778.3 –15.6 –17.5 –43.2 Matthews Asia:India;Inv 1,540.1 –1.3 0.9 11.1 RS Inv:Gl Nat Res;A 1,897.9 –6.1 –38.2 –4.0
AQR:Eqty Mkt Ntrl;I 190.9 1.8 2.3 17.6 iPath ETN P Beta Nickel 0.8 –1.1 –15.6 –43.1 Vanguard Hlth Cr Idx;ETF 6,548.2 8.8 7.2 11.1 Franklin Gld&Pr Mt;A 594.9 –4.5 –22.4 –3.9
ProShares:UlS MSCI MexCI 1.3 10.6 0.8 17.6 Glbl X Brazil Cnsmr ETF 2.9 –2.0 2.5 –42.2 MFS Technology;A 460.8 10.4 10.4 11.1 PowerShares Dyn Oil 52.4 –3.0 –31.2 –3.7
ProShares:UltP QQQ 1,402.1 –5.5 30.4 17.4 Mrkt Vctrs:Indonesia SC 5.8 2.3 7.5 –42.1 WellsFargo:Growth;Inst 9,380.0 6.5 2.9 11.1 Hussman Inv:Strat Gro 635.4 –7.4 –8.4 –3.7
Nuveen Tw Japan;I 16.9 –0.5 6.9 17.4 US Diesel-Heating Oil 3.1 –19.7 –31.9 –42.0 USAA NASDAQ-100 Idx 931.8 10.1 9.1 11.0 Fidelity Sel Nat Gas 340.8 –10.3 –36.8 –3.7
DB Gold Double Short ETN N.A. –0.4 9.0 17.4 Mrkt Vctrs:Steel 50.5 –8.3 –4.8 –41.9 Columbia:Sel C&Info;A 4,160.9 10.8 9.1 11.0 GAMCO Mathers;AAA 14.8 –4.7 –3.0 –3.6
WisdomTree:Jpn Hgd SC Eq 199.4 –1.5 9.0 17.3 Direxion:Zacks MLP HI Sh 73.7 –13.9 –16.6 –41.9 Fidelity Sel Cnsmr Stp 2,748.0 8.2 1.9 11.0 J Hancock II:NatRs;NAV 610.1 –4.0 –28.9 –3.6
AQR:Lng-Sht Eqty;I 432.3 0.5 5.9 17.0 PowerShares DB MS Oil 474.3 –13.2 –19.6 –41.5 Sel Sector:C Stp SPDR 7,825.5 7.7 6.8 10.9 Invesco Gold&Prec;A 185.2 –1.7 –24.8 –3.4
ProFunds:Sh Pr Mtls;Inv 20.1 –1.5 –8.5 16.7 DB Crude Oil Long ETN N.A. –13.5 –19.6 –41.3 Matthews Asia:China;Inv 799.5 10.3 2.4 10.9 Oppenheimer Gld & Sp;A 688.1 1.3 –23.1 –3.2
Leland TR VNCP Idx;I 12.6 –0.3 17.0 16.4 iShares:MSCI Brazil Cap 1,778.3 –5.0 –2.9 –41.3 ProFunds:Cnsmr Goods;Inv 15.3 8.7 5.8 10.8 SunAmerica:Itl Div S;A 102.2 –0.3 –16.8 –3.2
iShares:MSCI Japan Min V 34.0 2.1 9.0 16.4 Glbl X MSCI Colombia ETF 57.2 2.5 –8.4 –41.3 J Hancock III:DVMC;I 11,732.2 5.0 2.1 10.8 USAA Prec Met&Min;Fund 525.6 –2.0 –26.5 –3.1
Royce Fd:Intl Prm;Svc 9.8 1.5 8.5 16.2 iShares:MSCI ColombiaCap 12.8 3.3 –7.9 –40.9 Oppenheimer Intl SMC;A 5,665.4 5.2 14.9 10.8 Rydex:Energy Svcs;Inv 19.4 –1.4 –31.8 –3.1
Rainier:Intl Discv;Instl 111.1 0.4 3.5 15.9 United States Nat Gas 513.5 –0.6 –25.1 –40.6 Reynolds:Blue Chip Gro 116.7 4.4 1.5 10.8 Deutsche Enh Com S;Inst 684.3 –6.1 –16.9 –3.0
ProShares:UlS Bas Mat 17.3 7.2 –19.9 15.8 Guggenhm Cdn Energy ETF 27.8 –11.2 –7.4 –40.5 Firsthand Tech Opptys 113.7 6.2 4.3 10.8 US Glbl:Gold&PM 54.6 2.4 –4.8 –2.9
Note: For funds with multiple share classes, only the largest is shown *Annualized N.A. = not applicable, fund is too new r
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THE WALL STREET JOURNAL. Monday, January 11, 2016 | R11
Star ratings shown are for Class Z shares, which are available to individual investors through certain retirement and wrap fee
programs, and to institutions at an investment minimum of $5,000,000. Performance by share class may vary. In addition to
the ones shown above, other classes, which contain either a sales load or a contingent deferred sales charge, are also available.
These expenses will generally lower total fund return. Please see the prospectus for additional information about fees, expenses
and investor eligibility requirements.
Consider a fund’s investment objectives, risks, charges, and expenses carefully before investing. The prospectus and summary prospectus contain this and other
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Only eligible investors, including various institutional investors and investors in certain mutual fund wrap or asset allocation programs, may purchase Class Z shares.
See the prospectus for eligibility requirements.
Mutual fund investing involves risks. Some funds are riskier than others. The risks associated with investing in these funds include but are not limited to: derivative
securities, which may carry market, credit, and liquidity risks (All funds); short sales, which involve costs and the risk of potentially unlimited losses (PIFZX, PDBZX,
PRUZX); leveraging, which may magnify losses (PDCZX, PIFZX, PDBZX); high yield (“junk”) bonds, which are subject to greater market risks (PDCZX, PIFZX, PDBZX);
small/mid-cap stocks, which may be subject to more erratic market movements than large-cap stocks (PRJZX, PDCZX); foreign securities, which are subject to currency
fluctuation and political uncertainty (PURZX, PDBZX, PRUZX, PRJZX, PDCZX); real estate, which poses certain risks related to overall and specific economic conditions
as well as risks related to individual property, credit, and interest-rate fluctuations (PURZX); and mortgage-backed securities, which are subject to prepayment and
extension risks (PIFZX, PDBZX). Sector funds and specialty funds may not be suitable for all investors. Such funds are non-diversified, so a loss resulting from a particular
security will have greater impact on the fund’s return (PURZX, PRUZX). Fixed income investments are subject to interest rate risk, and their value will decline as interest
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Rating based on a Morningstar risk-adjusted return measure that accounts for variation in a fund’s monthly performance, including the effects of sales charges, placing more
emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35%
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R12 | Monday, January 11, 2016 THE WALL STREET JOURNAL.
ANSWER: A. Apple and Alphabet. The Del- 10 Fill in the blank: Covepoint Capital
Advisors LLC’s Melissa Ko said she
agreeing to buy it for $1 billion? bond desk said “you can still _____ in high oitte study also predicted that robo advis- produced a 120%-plus return last year
A. Warby Parker B. DraftKings yield.” ers, meaning automated investing services, partly with bets against the euro. Re-
C. Pep Boys D. Volkswagen A. crush it will attract $5 trillion to $7 trillion in in- garding the euro’s rally against the dol-
B. get crushed vestor money within a decade. lar in late 2015, she said: “I think it’s
ANSWER: C. Japanese tire maker Bridge- C. feel the pain ____”
stone Corp. had also sought to buy the car
parts and repair chain in Philadelphia,
whose full name is Pep Boys—Manny, Moe
D. make good money
Roll over your old 401(k) into a new account and get up to $600.
Visit tdameritrade.com/rollover for details or call 800-213-4583.