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
DJIA 20504.41 À 92.25 0.5%
What’s
News
Business & Finance
he unraveling of two
T health-insurance merg-
ers worth a combined $82
billion all but quashes a
deal boom that would have
reshaped the industry. A1
 Yellen signaled that the
Fed could consider a rate
rise in March if the economy
continues to strengthen. A2
 Goldman, J.P. Morgan
and BofA hit fresh trading
milestones amid a boom in
shares of U.S. banks. A1
 Investors scooped up
stocks, sending indexes to
new highs. The Dow rose
92.25 to 20504.41. B15, B16
 Trian has built a $3 bil-
lion-plus stake in P&G, add-
ing urgency to the consumer
giant’s turnaround efforts. A1
 GM is weighing a sale of
its Opel unit to France’s Peu-
geot, signaling a retreat from
the European market. B1
 Japan’s SoftBank agreed
to buy U.S. asset manager
Fortress Investment Group
in a $3.3 billion deal. B1
 Toshiba projected a $6.3
billion write-down, delayed
its earnings report and said
its chairman was leaving. B2
 CSX revealed an activ-
ist investor’s demands and
called for its shareholders
to vote on the matter. B3
 YouTube canceled top
star PewDiePie’s show over
his anti-Semitic jokes. B1
World-Wide
 The FBI questioned Flynn
in January, shortly after the
White House denied that the
then-national security ad-
viser had discussed sanctions
with a Russian official. A1
 Israel’s Netanyahu be-
gan meetings in Washing-
ton ahead of a critical
summit with Trump. A6
 Graft probes have
weakened the Israeli prime
minister at home. A6
 The half-brother of North
Korean leader Kim was
killed under mysterious cir-
cumstances in Malaysia. A7
 The campaign of French
presidential hopeful Macron
said Russia is trying to de-
stabilize his candidacy. A18
 Trump’s pick for labor
secretary is expected to face
tough questions in a confir-
mation hearing Thursday. A5
 Venezuela’s government
rejected U.S. allegations
that its vice president
aided drug traffickers. A18
 Greece is balking over its
creditors’ latest austerity
proposal, ending hopes of a
bailout deal this month. A18
 Gene-editing trials involv-
ing eggs, sperm and embryos
could be permitted in limited
cases, a report said. A3
 A New York jury found a
man guilty of killing Etan Patz,
who was 6 years old when
he vanished in 1979. A14A
CONTENTS
Business News...... B3
Crossword.............. A14
Heard on Street. B15
Life & Arts......... A9-13
Management.......... B5
Markets.................... B16
s Copyright 2017 Dow Jones &
Company. All Rights Reserved
Capital Creates Change
We work with visionary companies to bring big ideas to life—harnessing capital,
not just to create wealth, but also to create positive change.
* * * * * WEDNESDAY, FEBRUARY 15, 2017 ~ VOL. CCLXIX NO. 37
NASDAQ 5782.57 À 0.3% STOXX 600 370.20 À 0.02%
Flynn Probed by FBI Over Calls
BY DEVLIN BARRETT
AND CAROL E. LEE
WASHINGTON—Federal
agents questioned then-Na-
tional Security Adviser Mike
Flynn in January, shortly after
the White House denied he
had talked about sanctions
with a Russian official, accord-
ing to people familiar with the
matter.
The Federal Bureau of In-
vestigation interview, which
raises the legal stakes for Mr.
U.S. Makes Show of Force in Europe as NATO Debates Budget
DANIEL MIHAILESCU/AGENCE FRANCE-PRESSE/GETTY IMAGES
MILITARY MIGHT: U.S. Army personnel on Monday unloaded equipment at an air base in Romania as part of a response to Russia’s actions in
Ukraine. This week top officials attend a meeting of the North Atlantic Treaty Organization in Brussels and a security conference in Munich. A8
Wall Street Walk
Almost 10 years later,
Goldman Sachs’s share price
has reclaimed precrisis levels.
$300
Tuesday
$249.46
250
200
150
100
50
0
2007 ’09 ’11 ’13 ’15 ’17
Source: FactSet
THE WALL STREET JOURNAL.
If Your Name Is Mr. Test, It’s
Really Hard to Fill in Web Forms
i i
Nulls, Blanks, and Samples also battle
code that treats their surnames as fakes
BY PATRICK MCGROARTY
This is a Test. Tom Test, a
voice-over artist in Chicago. He
wants the internet to know
that’s actually his name.
“Sometimes I write back, ‘I’m
a real person!’ ” Mr. Test said of
emails he receives several times
a month seeking to confirm his
subscription to dating apps and
Opinion.............. A15-17 shopping sites he didn’t join.
Property Report... B8
Many people keen to hide their
Sports....................... A14
Technology............... B4
U.S. News............. A2-5
own identity, he has surmised,
assume “Tom Test” is a name
Weather................... A14
World News. A6-7,18
no one has.
“It can be exasperating,” he
said.
> His brother Brian Test
agrees. So do Avery Blank,
Christopher Null and David
Books. Each has a surname
some computers—or the people
operating them—consider too
good to be true.
a dv e rt i s e m e n t
The story continues on page A5.
10-YR. TREAS. g 10/32 , yield 2.470%
Flynn and adds to the political
pressure on the White House,
came after the president’s
spokesman Sean Spicer, at a
Jan. 23 news briefing, said Mr.
Flynn didn't discuss U.S. sanc-
tions with Sergey Kislyak, Rus-
sia’s ambassador to the U.S.
At that point, U.S. intelli-
gence officials had already in-
tercepted conversations be-
tween the two men in which
they discussed the sanctions,
according to people familiar
with the matter.
Boom Time for Bank Stocks
As Goldman Regains Peak
BY LIZ HOFFMAN
AND CHRISTINA REXRODE
Shares in America’s banks
are booming again, with Gold-
man Sachs Group Inc., J.P. Mor-
gan Chase & Co. and Bank of
America Corp. hitting fresh
trading milestones Tuesday
that seemed unreachable dur-
ing the crucible of the financial
crisis.
Investor expectations of
higher interest rates, lower
taxes, lighter regulation and
i At Airport
Some names are common
placeholders used to check web-
site features. Others are com-
mands that trigger software or
scripts of code to leave an entry
empty. A small slice of the pop-
ulation has a surname that trips
up computers. But for them,
opening a bank account or re-
serving a rental car can be a
punishing experience.
“I was a flaw in their sys-
tem,” said James Test, Tom’s
uncle, of one September Sacra-
mento-to-Tucson trip that was
thwarted at every turn because
his American Airlines reserva-
tions were repeatedly canceled.
“The booking would last only
long enough to process my
credit card, then fade to just a
test,” he said.
American spokesman Matt
Miller recommended customers
Please see TEST page A8
OIL $53.20 À $0.27
Fallout for Trump
 Gerald F. Seib: White
House at crossroads....... A4
 Ex-SEAL is front-runner for
national security post..... A4
 Flynn is first casualty of
turmoil..................................... A5
Mr. Flynn’s departure gen-
erated more questions Tues-
day about what Mr. Trump, a
Republican, knew about Mr.
Flynn’s activities and why it
faster economic growth under
the Trump administration have
added $280 billion in combined
market value to the nation’s six
largest banks since Nov. 8.
On Tuesday, shares of Gold-
man hit a record high, passing a
bar first set in 2007 before the
financial crisis. J.P. Morgan also
hit an all-time closing high.
Meanwhile, Bank of America
traded in line with its net
worth—or the difference be-
tween its assets and liabilities—
for the first time since late
TOSHIFUMI KITAMURA/AFP/GETTY IMAGES; KCNA/EPA (KIM JONG-UN)
Activist Builds $3 Billion Stake in P&G
BY DAVID BENOIT
AND SHARON TERLEP
One of the biggest activist
investors has built up a more
than $3 billion stake in Procter
& Gamble Co., adding urgency
to the consumer-product giant’s
efforts to turn around its busi-
ness and boost its stock price.
WSJ.com HHHH $3.00
GOLD $1,223.90 g $0.50 EURO $1.0579 YEN 114.26
took weeks for Mr. Trump to
push him out.
Mr. Spicer said the presi-
dent was informed about the
Marc Lotter. Mr. Lotter didn’t
explain the lag in the vice
president’s knowledge.
It is unclear what Mr. Flynn
contents of Mr. Flynn’s conver- told the FBI agents, or
sations with the Russian am- whether his account during
bassador in late January, and the interview was contradicted
White House officials spent a by intelligence intercepts. But
“few weeks” looking into the
matter.
the very act of undergoing an
interview is potentially signifi-
Vice President Mike Pence, cant for Mr. Flynn because it
who had vouched publicly for is a crime to lie to the FBI;
Mr. Flynn, didn’t learn until charges have been filed
Feb. 9 about the discussion of against senior officials in pre-
sanctions, said his spokesman, Please see PROBE page A4
Antitrust
Rulings
Put Chill
On Health
Mergers
BY ANNA WILDE MATHEWS
AND BRENT KENDALL
Two health-insurance merg-
ers worth a combined $82 bil-
lion are unraveling in the wake
of court rulings that found the
transactions violated federal
antitrust law, all but quashing
a deal boom that would have
reshaped the industry.
Aetna Inc. and Humana Inc.
said Tuesday they would ter-
minate their $34 billion
merger agreement instead of
attempting to appeal a judge’s
decision last month that their
combination would harm se-
nior citizens.
Just hours later, Cigna
Corp. said it was calling off its
$48 billion merger agreement
with Anthem Inc. and pursuing
litigation seeking a $1.85 bil-
lion breakup fee plus more
than $13 billion in damages
from its deal partner.
Cigna’s announcement esca-
lated a monthslong fight in
which the two companies have
2008. The bank had been trad- accused each other of violat-
ing as low as 15% of this level in ing their merger agreement.
March 2009. Anthem immediately disputed
Bank stocks overall have Cigna’s authority to nix the
outperformed broader stock deal.
markets since the election. The “Anthem will continue to
roughly 27% gain since Nov. 8 enforce its rights under the
for the KBW Nasdaq Bank Index merger agreement and re-
is around three times that of mains committed to closing
the S&P 500. Markets rose fur- the transaction,” an Anthem
ther Tuesday; the Dow Jones spokeswoman said.
Please see STOCKS page A7 Anthem has said it unilater-
ally extended the merger
 A Dodd-Frank statute that agreement through April 30
banks like..................................... B6 Please see CIGNA page A2
Dictator’s
Brother Killed
In Attack
PUZZLE: Kim Jong
Nam, far left, the
estranged half-
brother of North
Korea’s leader, Kim
Jong Un, left, died
after apparently
being attacked at a
Malaysian airport.
Police said he may
have been
poisoned. A7
Trian Fund Management LP, largest investment ever. It’s un-
which in previous years has clear what changes Trian, co-
targeted companies like Pep- founded by Nelson Peltz, will
siCo Inc. and DuPont Co., dis- seek at the maker of Tide de-
closed Tuesday it had bought tergent, Gillette razors and
shares in P&G, which has a Pampers diapers.
market value of $225 billion. P&G said it welcomed the
Trian’s bet, at more than $3 bil- investment after The Wall
lion, according to a person fa- Street Journal first reported
miliar with the matter, is its Please see TRIAN page A7
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
A2 | Wednesday, February 15, 2017
Yellen Signals Potential March Rate Move
BY HARRIET TORRY
Federal Reserve Chair-
woman Janet Yellen signaled
Tuesday that the central bank
could consider raising short-
term interest rates at its next
policy meeting in March if the
economy continues to
strengthen as expected.
An increase in the Fed’s
benchmark federal-funds rate
likely would be appropriate “at
our upcoming meetings,” bar-
ring an unexpected setback to
job gains or rising inflation,
Ms. Yellen said on the first of
two days of testimony before
House and Senate commit-
tees—her first to Congress
since President Donald Trump
took office.
She didn’t say the Fed’s
next policy meeting March
14-15 would be the likely time
for action, but her remarks to
the Senate Banking Committee
were the first to publicly open
U.S. WATCH
MISSOURI
KKK Leader Killed;
Wife, Stepson Held
The wife and stepson of a
self-proclaimed national leader
of the Ku Klux Klan in Missouri
are being held in jail without
bond after being charged Mon-
day with his murder.
Malissa Ancona, 44 years old,
and her son Paul Jinkerson Jr.,
24, were charged with first-de-
gree murder, abandoning a
corpse and tampering with phys-
ical evidence over the death of
51-year-old Frank Ancona, ac-
cording to the St. Francois
County, Mo., prosecutor’s office.
Mr. Ancona was the self-pro-
claimed national leader of the
Traditionalist American Knights
of the Ku Klux Klan, though
there are many rival factions
and chapters of the group in
Missouri and across the country.
—Shibani Mahtani
PHILANTHROPY
Gates Foundation:
Foreign Aid Is Vital
Bill and Melinda Gates have a
message to the U.S. and other
nations that have recently sig-
naled they will prioritize domes-
tic needs: Don’t give up on for-
eign aid.
The U.S. spends less than 1%
of its annual budget on foreign
aid, but the money has saved
millions of lives, the co-chairs of
the Bill & Melinda Gates Foun-
dation said in recent interviews
in advance of the release of
their widely read annual letter,
which this year lays out signifi-
cant progress made in global
health over the past several
years.
—Betsy McKay
T H E R E S O RT AT
PELICAN
HILL
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One Hour from LA in Newport Beach, CA
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Fed Chairwoman Janet Yellen testified to a Senate panel Tuesday.
the door to the possibility.
“I can’t tell you exactly
which meeting it would be,”
she said later, in response to a
question.
Many investors still don’t
see a March rate increase as
ECONOMY
Report Signals
Higher Inflation
U.S. producer prices rose in
January at the quickest rate in
more than four years, another
sign of higher inflation.
The producer-price index rose
0.6% in January from a month
earlier, twice the rate econo-
mists projected. Prices climbed
1.6% over the past year.
A big factor was rebounding
oil markets, but prices grew
broadly.
Prices excluding energy and
food rose 0.4% over the month
and 1.2% for the year.
—Josh Mitchell
ECONOMY
Parents May Help
Ease Layoff Impact
Losing a job can have devas-
tating and long-lasting financial
consequences, but new research
suggests one factor that might
help soften the blow: living
down the street from mom and
dad.
People tend to see a sharp
drop in their earnings after a
layoff, and continue to experi-
ence a pay gap with their non-
displaced peers for years to
come. But new research from
the Federal Reserve Bank of
Cleveland shows a divide among
workers in their mid-20s to
mid-30s who lost a job. Within
six years, those who lived in the
same neighborhood as their par-
ents were earning as much as
similar workers who didn’t lose
their jobs. Workers who lived
further away from home, on the
other hand, never recovered
from the job loss.
—Ben Leubsdorf
®
NY
U.S. NEWS
“The tone was certainly
consistent with a first-half rate
hike, but probably not hawkish
enough to make the March
meeting a likely outcome,” J.P.
Morgan Chase economist Mi-
chael Feroli said in a note to
clients.
Central-bank officials lifted
the federal-funds rate in De-
cember to a range between
WIN MCNAMEE/GETTY IMAGES
0.50% and 0.75%, and penciled
in three quarter-percentage-
point moves in 2017. They held
the rate steady at their Jan. 31-
Feb. 1 meeting.
Ms. Yellen was generally up-
beat about the economy, with
a longer list of reasons for op-
timism than for worry. She and
her colleagues expect to see
likely. After Ms. Yellen’s testi- the job market continue to im-
mony, investors in federal- prove and inflation to rise to
funds futures, which are used their 2% target, against a back-
to bet on Fed interest-rate drop of moderate growth and
moves, saw just a 13.3% proba- healthy consumer spending.
bility of a move next month, She cautioned that holding
according to CME Group. off too long on rate increases
Wedding En Masse in West Palm Beach
VALENTINE’S DAY SPECTACULAR: About 40 couples enjoyed their free wedding in West Palm Beach, Fla., on Tuesday. The National
Croquet Center hosted and local businesses donated services for the event organized by Palm Beach County Clerk and Comptroller’s Office.
CIGNA front. The companies’ tandem
announcements of the termi-
nation Tuesday said it was a
mutual decision, and both said
Continued from Page One Aetna will now owe Humana a
and is appealing the antitrust $1 billion breakup fee.
decision, but it faces numer- Aetna Chief Executive Mark
ous obstacles to salvaging the T. Bertolini said Tuesday
transaction. “both companies need to move
The fate of both deals rep- forward with their respective
resents a victory for the strategies in order to continue
Obama administration’s anti- to meet member expecta-
trust officials, who were able tions.”
to win the cases despite major Though the decision allows
differences between the two the two insurers to avoid what
transactions.
In the Aetna case, a judge
had been widely seen as an
uphill battle to preserve the
in January said the merger deal, it also leaves them with
could harm seniors who buy challenges as they move ahead
the private Medicare plans
known as Medicare Advantage.
The Anthem antitrust decision
by a different judge last week
focused closely on that acqui-
as stand-alone companies.
Aetna will now need to find
new engines for growth, and it
has highlighted hopes for
Medicare, Medicaid and its
sition’s potential impact on
large, multistate employers
that offer health coverage to
their workers.
Both acquisitions came to-
core commercial franchise. The
Humana deal would have
vaulted it to the top position
in the growing Medicare Ad-
vantage business.
gether amid an insurance-in- Humana said Tuesday that
dustry merger frenzy in 2015, the breakup fee is worth about
but the dynamics in each have $630 million after taxes. In a
been different. call with analysts to discuss
Aetna and Humana pre- its 2017 financial guidance,
sented a more united public Humana Chief Executive Bruce
CORRECTIONS  AMPLIFICATIONS
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* ***
“would be unwise,” since it
could force the Fed to lift rates
more aggressively if inflation
shoots higher, which could risk
pushing the economy into re-
cession.
That message was echoed
Tuesday by two other Federal
Reserve officials. Dallas Fed
President Robert Kaplan said
in Houston that rate increases
should happen sooner rather
than later. Richmond Fed Pres-
ident Jeffrey Lacker said in
Newark, Del., that “signifi-
cantly higher rates are war-
ranted” and that “there’s quite
a compelling case for a March
increase.”
Other Fed officials, how-
ever, might want to see more
economic gains before raising
rates. They will get more infor-
mation to parse before their
March decision, including data
on growth, retail sales and em-
ployment.
“I don’t think there’s a great
Broussard said his company
was “confident in our future.”
The company is seen as an
attractive takeover target once
again, and Mr. Broussard said
Humana was “always oriented
toward the most effective
shareholder value, and we
would obviously review any
kind of interest into the organ-
ization.”
Humana, which had re-
treated somewhat from the Af-
Anthem faces
numerous obstacles in
its effort to salvage
the transaction.
fordable Care Act’s exchanges
this year after losses, also said
it would fully withdraw from
the business in 2018. Mr.
Broussard said the insurer was
“seeing signs of an unbalanced
risk pool” in its 2017 enroll-
ment.
That decision is an early
troublesome sign for the
Trump administration, which,
Singer Katy Perry at the
Grammy Awards on Sunday
wore an armband with the
word “persist.” A Life & Arts
article Monday about the
Grammys incorrectly said the
armband read “resist.”
DuPont Co. said it would
pay half of a $670.7 million
proposed settlement of litiga-
tion over perfluorooctanoic
acid in drinking water in Ohio
and West Virginia, while
Chemours Co., which DuPont
spun off in 2015, would pay
the other half. A Page One
What’s News item in some edi-
tions Tuesday incorrectly said
DuPont would pay the full
amount.
THE WALL STREET JOURNAL.
deal of urgency” to raise rates,
Atlanta Fed President Dennis
Lockhart said Tuesday in
Huntsville, Ala. “I don’t know
what the committee will de-
cide in March, but I don’t see
really compelling reasons to
move” at that gathering, he
told reporters.
One uncertainty for the Fed
is the potential impact of Mr.
Trump’s economic plans. He
has promised to cut taxes and
boost government spending,
but details of the policies re-
main unclear and legislation
would be subject to congres-
sional approval. Ms. Yellen
said that Fed officials “don’t
want to base current policy on
speculation about what might
come down the line.”
Ms. Yellen is scheduled to
testify Wednesday before the
House Financial Services Com-
mittee.
—Michael S. Derby
contributed to this article.
JOE RAEDLE/GETTY IMAGES
while critical of the Affordable
Care Act, is expected to issue
a regulation that includes ef-
forts to stabilize the law’s in-
surance marketplaces into
2018.
For its part, Anthem faces
challenges in its solo effort to
appeal the antitrust ruling.
Even if it is able to keep Cigna
in the fold until the end of
April, that is almost certainly
not enough time to clear the
various legal and regulatory
hurdles the insurer must over-
come to complete a deal.
Cigna said in a statement
Tuesday that the merger “can-
not and will not achieve regu-
latory approval” and that “ter-
minating the agreement is in
the best interest of Cigna’s
shareholders.”
The insurer said its lawsuit
seeking billions of dollars in
damages from Anthem in-
cludes “the amount of pre-
mium that Cigna shareholders
did not realize as a result of
the failed merger process.”
Cigna said it filed the lawsuit
in the Delaware Court of
Chancery.
Cigna’s move is the latest
twist in the increasingly dis-
cordant relationship between
the two merger partners, in-
cluding battles over strategy,
direction and leadership that
have become increasingly pub-
lic over the past several
months.
Analysts have long said liti-
gation between the two ap-
peared likely in the event of a
negative antitrust ruling. Dur-
ing trial proceedings that be-
gan in November, Anthem
mounted a legal defense of the
merger single-handedly. Cigna
lawyers said very little during
the proceedings, and when
they did, it usually didn’t help
Anthem’s position.
Cigna said Tuesday that An-
them had breached their
agreement by not using its
“reasonable best efforts” to
win regulatory approval for
the deal.
Anthem declined to com-
ment Tuesday beyond its
statement disputing Cigna’s
right to break off the merger.
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
THE WALL STREET JOURNAL.
Universities,
Facing Cuts,
Target Tenure
GOP lawmakers move
to scale back or end
job protections for
longtime professors
BY DOUGLAS BELKIN
For decades, tenured pro-
fessors held some of the most
prestigious and secure jobs in
the U.S. Now, their status is
under attack at public and pri-
vate colleges alike.
In states facing budget pres-
sures such as Missouri, North
Dakota and Iowa, Republican
lawmakers have introduced
bills for the current legislative
sessions to eliminate tenure,
cut back its protections or cre-
ate added hoops that tenured
faculty at public colleges must
jump through to keep their
jobs. University administra-
tors, struggling to shave their
costs, are trying to limit the
ranks of tenured professors
or make it easier to fire them.
The institution of tenure—
which provides job security
and perks like regular sabbati-
cals—began in the U.S. early in
the 20th century as a bulwark
against interference from ad-
ministrators, corporate inter-
ests and politicians who might
not like professors’ opinions
or research.
Attacks on tenure have be-
come commonplace in the
wake of the recession as re-
Virginia Judge’s Ruling Puts Pressure on White House
BY ARUNA VISWANATHA
AND BRENT KENDALL
A Virginia judge’s sharply
worded ruling against Presi-
dent Donald Trump’s executive
order on immigration this
week, which focused on the
question of religious discrimi-
nation, is increasing pressure
on the White House as it seeks
to rewrite the order or find
another legal path forward.
In a 22-page ruling late Mon-
day, U.S. District Judge Leonie
Brinkema said Mr. Trump’s ex-
ecutive order likely violated
constitutional protections
against religious discrimination,
and she barred enforcement of
part of the order in Virginia
while the case continues.
The White House has said it
is working toward rewriting the
executive order to make it more
legally palatable, and the Vir-
ginia decision adds another
layer of complexity to the effort.
That decision follows one last
week from the Ninth U.S. Circuit
Court of Appeals in San Fran-
cisco, which said Mr. Trump’s
temporary travel ban on people
arriving from seven Muslim-ma-
jority countries should remain
on hold nationwide.
The White House has said the
ban is necessary to thwart ter-
rorist attacks. The Justice De-
partment declined to comment
Door Opens to Gene Editing in Embryos
BY AMY DOCKSER MARCUS
Clinical trials involving the
editing of genes in sperm,
eggs and early-stage embryos
could be permitted under cer-
tain conditions, the National
Academies of Sciences and the
National Academy of Medicine
recommended Tuesday in a
long-awaited report.
Once technical questions are
resolved, clinical trials could
start with extensive oversight,
the report said. But the report
urged limiting trials to the
“most compelling circum-
stances,” such as when no other
treatment exists, the condition
is very serious, and the genes
in question are well known to
cause a particular disease.
Gene editing offers the pos-
sibility of treating many dis-
eases, and there are already tri-
als or advanced research under
way to use the techniques to
try to cure people with HIV,
sickle cell anemia and cancer.
But adjustments made to the
human germ line—eggs, sperm
and embryos—don’t just
change the health of a single
person; they can be passed on
* * * *
ductions in public support for
colleges led to steep tuition in-
creases that have driven up
student debt and magnified
scrutiny on the business prac-
tices of universities. Conserva-
tive lawmakers also have ex-
pressed mounting displeasure
with university professors,
saying they indoctrinate im-
pressionable students with a
liberal point of view.
“We’ve gone from an atmo-
sphere of optimism [15 years
ago] to a time of crisis and de-
spair,” said Russ Castronovo,
chairman of the English de-
partment at the University of
Wisconsin, Madison, which saw
deep cuts and reduced tenure
protections in recent years.
In 2015, the Wisconsin Leg-
islature voted to weaken a
state tenure law and cut $250
million from the university’s
budget. The university board
of regents last year instituted
“independent and substantive
reviews” of tenured faculty ev-
ery five years. If deemed lack-
ing, they have three or four
semesters to improve or are
shown the door, said James
Schmidt, chancellor of Univer-
sity of Wisconsin, Eau Claire.
Republican Gov. Scott
Walker recently announced
plans to cut tuition by 5%
across all University of Wis-
consin System schools while at
the same time instituting a fac-
ulty accountability policy that
would monitor the time profes-
on the Virginia judge’s ruling.
The Ninth Circuit ruling,
however, followed different rea-
soning, saying the White House
order appeared to violate consti-
tutional due process protections.
That leaves the administra-
tion with at least two major le-
gal challenges to address in
any new order, as well as un-
certainty as to whether the
more than 20 existing court
cases against the order will
stand if a new order is issued.
Focus on religious
discrimination
complicates case for
Trump administration.
The White House faces po-
litical pressure to move quickly
on a new order to show it is on
the offensive after the court
defeats. That could conflict
with a typical legal strategy,
which counsels a slower, more
deliberate approach.
The Ninth Circuit’s focus on
due process gave the Trump
administration a road map to
write a narrower order that
might withstand legal scrutiny.
It could perhaps take aim at
restricting the travel of indi-
Human embryos are put on a petri dish at a lab in La Jolla, Calif.
Gene editing in embryos could occur as technology advances.
to any future offspring.
For that reason, a gene-edit-
ing trial involving the germ line
would have to include not only
oversight of people in the trial
but a follow-up on the long-
term health of future genera-
tions, presumably including
people who haven’t been born
yet and never consented to be-
ing in a clinical trial.
The report was the result of
work by an advisory commit-
Wednesday, February 15, 2017 | A3
U.S. NEWS
LAUREN JUSTICE FOR THE WALL STREET JOURNAL
‘We’ve gone from…optimism to a time of crisis and despair,’ says Russ Castronovo, English chairman, University of Wisconsin, Madison.
sors spend in the classroom. should be guaranteed a job for nomic growth. “If they get rid $1,500 and $5,000 a course.
Faculty at State College of life,” said Iowa state Senator of it, it would cost them hun- Schools across the country,
Florida hired after July 2016 Brad Zaun, a Republican who dreds of millions of dollars in mostly small, private colleges
no longer qualify for tenure- filed a bill for the current legis- grants; its financial idiocy to like Wartburg College in Iowa
like protections. In North Da- lative season that would elimi- do something like this,” said and the College of Saint Rose
kota, the state board of higher nate the possibility of tenure David Soll, a professor of biol- in New York, have been offer-
education is considering re- for new hires and strip it from ogy at the University of Iowa. ing buyouts to cull their ranks
ducing to 90 days from 12 holders of tenure at the three In 1975, 45% of faculty at of longtime faculty. Other
months the amount of time regents universities in his state. public and private schools was schools have eliminated entire
administrators need to give Bruce Rastetter, president of tenured or tenure-track; the academic departments.
tenured faculty before they lay the Iowa Board of Regents, and 2014 figure is 29%. The bal- Professors contend they are
them off. The state’s 11-school a leading state GOP donor, ance of the jobs are now filled already working harder than
college and university system doesn’t support it. “We oppose by part-time adjunct profes- ever. “We’re under a lot more
is bracing for steep layoffs this this bill, and I look forward to sors who make, on average, pressure to be more produc-
year after cutting about 500 meeting with Sen. Zaun to less than half the salary of tive,” said John Ziker, an an-
full-time positions last year. hear his thoughts,” he said. tenured professors, enjoying thropologist at Boise State
A Missouri bill would pro- Defenders of tenure say few of their benefits. While University who conducted a
hibit any public institution of states that do away with it will the average salary of a full time-use survey on his mostly
higher education from award- be at a disadvantage bringing professor is $142,141, accord- tenured peers that found on
ing tenure after Jan. 1, 2018. in the most talented profes- ing to the American Associa- average they work 51 hours
“I just don’t think if you’re sors and risk losing valuable tion of University Professors, during the week and 10 more
being paid with tax dollars you grants that can power eco- adjuncts are paid between over the weekend.
viduals who never previously
have been cleared to enter the
U.S., as opposed to green card
holders and those who already
have received visas.
“The further they get from
people who have applied to or
been granted admission to the
country, the easier it gets” for
the government to argue that
the order is constitutional, said
BRENDAN SMIALOWSKI/AGENCE FRANCE-PRESSE/GETTY IMAGES
Timothy Heaphy, a former U.S.
Attorney in Virginia who rep-
resented a visa-holder initially
affected by the travel ban.
The Virginia ruling poten-
tially presents a thornier prob-
lem, because Judge Brinkema
found that the executive order
improperly targeted Muslims
without any evidence of a na-
tional security threat that
might justify a travel ban.
None of the court rulings so
far have considered the under-
lying legality of the executive
order, but have weighed
whether it should be sus- Nabil Alhaffar and her husband Muhamad Alhaj Moustafa, both Syrian citizens, at Washington Dulles
pended while the arguments International Airport last week. In January, she was denied re-entry to the U.S. after visiting Qatar.
on its fundamental legality
make their way through the regarding national security and
©T&CO. 2017
courts. In suspending the or- immigration that should not be
der, the judges have found second-guessed by the court.
that the underlying legal chal- Judge Brinkema, in question-
lenges are likely to succeed. ing those denials, cited previ-
The Trump administration ous statements from Mr. Trump
vigorously denies that the or- and his aides about seeking to
der was a Muslim ban and ar- bar Muslims from entering the
gued that the president has a U.S., linking those statements
clear right to make decisions to the executive order.
BETTER THAN
A BOUQUET
AND GUARANTEED TO TURN HEADS
cal questions. Gene editing is TIFFANY VICTORIA®
still a novel technology and can
have unintended, potentially
harmful, consequences that
would then be passed on to fu-
ture generations.
For years, such questions re-
mained in the realm of specula-
tion. But the introduction of a
SANDY HUFFAKER/BLOOMBERG NEWS
new gene-editing approach
called Crispr-Cas9, and its rapid
adoption by scientists due to its
comparative ease and lower
cost, makes the idea feasible in
a way it hasn’t been before.
“The technology has moved
significantly even during the
last year when we were study-
ing the issue,” said Richard O.
Hynes, co-chair of the commit-
tee that wrote the report and a
tee, which convened more than professor at the Massachusetts
a year ago at the request of the Institute of Technology in Cam-
nonprofit National Academies bridge, Mass. “Things that were
of Sciences and the National not feasible became feasible.”
Academy of Medicine. The com- The report’s cautious words
mittee studied the ethical, sci- aside, the findings represent a
entific and regulatory questions significant milestone in think-
raised by gene editing, and the ing about the topic because of
report weighs in on some of the the committee’s prestige and its
most difficult and emotionally suggestion that there is a po-
charged issues surrounding the tential ethical path to follow 800 843 32-9 | TIFFANY.COM
technology. once the technology is further
The idea raises difficult ethi- developed.
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
A4 | Wednesday, February 15, 2017
White House Finds Itself at a Crossroads
CAPITAL JOURNAL
GERALD F. SEIB
I
t’s not clear that an ad-
ministration can reach a
crossroads in just 25
days, but the new Trump
administration may have ar-
rived at precisely that.
The resignation of na-
tional security adviser Mike
Flynn Monday night capped
one of the
most tumul-
tuous open-
ing chapters
for a White
House in re-
cent times.
Whether his dramatic late-
night departure leads to-
ward something calmer and
more orderly, or ushers in a
prolonged stretch of more
of the same, is impossible to
know at this point.
Two key factors will de-
termine the answer. The
first is how much more is
revealed about the subject
that brought about Mr.
Flynn’s downfall, the con-
nections between Russia
and the Trump team. The
second is whether someone
can steer the administration
toward calmer waters; the
key figures in that effort
may well be Vice President
Mike Pence and White
House chief of staff Reince
Priebus.
For now, the biggest
problem for President Don-
ald Trump is that the quest
to learn more of his team’s
PROBE
Continued from Page One
vious administrations for lying
to investigators.
Mr. Flynn couldn’t be
reached for comment.
The FBI interview under-
scores that one the most se-
nior officials in the White
House had fallen under inves-
tigative scrutiny less than a
week into Mr. Trump’s presi-
dency.
Mr. Flynn’s contacts with
the Russian envoy is one of a
number of U.S. counterintelli-
gence investigations into Rus-
sian government contacts with
people close to Mr. Trump.
Democrats called for con-
gressional hearings to take
sworn statements from Mr.
Flynn to get to the bottom of
what the president knew and
when. Republicans began to
back some of those calls on
Tuesday.
“The [Senate] Intelligence
Committee is already looking
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Vice President Mike Pence, left, and White House Chief of Staff Reince Priebus at a White House meeting earlier this month.
relationship with Russia and
Russians isn’t ending. It’s
probably only beginning.
Mr. Flynn’s resignation
stemmed from conversa-
tions he had during the
transition with Russian Am-
bassador Sergey Kislyak,
and indications that in
those conversations he dis-
cussed the economic sanc-
tions the Obama administra-
tion had just imposed on
Russia over its alleged in-
terference in the 2016 elec-
tion. Any promise that the
new administration would
unwind those sanctions
could have represented a vi-
olation of the Logan Act,
which prohibits a private
at Russian involvement in our
election,” Senate Majority
Leader Mitch McConnell (R.,
Ky.) said Tuesday. “It’s highly
likely they’d want to take a
look at this episode as well.
They have the broad jurisdic-
tion.”
Rep. Adam Schiff of Califor-
nia, the ranking Democrat on
Mr. Flynn sought to
persuade Mr. Kislyak
not to ‘overreact’ to
the sanctions.
the House intelligence com-
mittee, said Tuesday his chief
concern was that “the White
House evidently knew for
some weeks that the country
had been misled and they
were OK with that. They were
willing to labor under this
falsehood.”
White House officials de-
fended their handling of Mr.
TM
P W L C 10 11 12
citizen from undercutting
foreign-policy initiatives of
the U.S. government.
Mr. Flynn at first denied
that sanctions were dis-
cussed, then backtracked,
and said he “inadvertently”
provided “incomplete infor-
mation” about his phone
communications. The key to
his downfall was misleading
Mr. Pence, who proceeded
to convey misleading ac-
counts on national televi-
sion.
D
emocrats in Congress
will demand to know
more about those con-
versations now, and espe-
cially what Mr. Trump knew
Flynn Tuesday, saying the
president moved to push out
Mr. Flynn when it became
clear that significant ques-
tions about his trustworthi-
ness had surfaced.
Mr. Spicer said the presi-
dent’s eroding level of trust in
Mr. Flynn was a result of his
contact with the Russian am-
bassador and a “series of
other questionable instances.”
Asked Tuesday night to de-
scribe the other instances, Mr.
Spicer declined to do so.
The sequence of events
leading up to Mr. Flynn’s
ouster Monday night began on
Dec. 29, when then-President
Barack Obama’s administra-
tion made public punitive
measures against Russia for
alleged hacking aimed at med-
dling with the U.S. presidential
election to favor Mr. Trump.
The U.S. said it was ejecting
35 suspected Russian intelli-
gence operatives from the
country and imposing sanc-
tions on Russia’s two leading
intelligence services.
That same day, Mr. Flynn
repeatedly reached out to the
Russian ambassador, accord-
ing to people familiar with
Russian intercepts. In a call,
Mr. Flynn sought to persuade
the ambassador not to “over-
react’’ to the measures, sug-
gesting Mr. Trump administra-
tion’s would soon be able to be
more friendly to Russia, these
people said.
Word of the contact be-
tween the two men first sur-
faced in mid-January. On Jan.
15, Mr. Pence told CBS that Mr.
Flynn never discussed sanc-
tions with the Russian ambas-
sador.
That statement alarmed U.S.
intelligence officials, who knew
of intercepts showing the two
had, in fact, discussed the
sanctions, according to people
Former Navy SEAL
Top Choice for Post
Retired Vice Admiral Bob
Harward favorite for Flynn job
The front-runner to succeed
Michael Flynn as White House
national security adviser is a
former Navy SEAL and retired
three-star admiral who became
one of Defense Secretary Jim
Mattis’s most-trusted col-
leagues while leading troops in
Afghanistan and Iraq.
Retired Vice Admiral Bob
Harward, who served as Mr.
Mattis’s deputy at U.S. Central
Command during the secretary’s
career as a Marine Corps gen-
eral, is at the top of the list for
the influential White House
post, according to a U.S. official
H T G K B F A M 1 2 3 4 5 6 7 8
U.S. NEWS
of them. But that may not
even be the administration’s
biggest headache. The issue
that has always been loom-
ing is the more explosive
question of whether there
were covert contacts be-
tween the Trump team and
Russian representatives in
an attempt to influence the
presidential campaign.
Both Democrats and Re-
publicans in Congress have
pledged to investigate the
Russian activity, and that in-
quiry may include a look into
a lengthy dossier compiled
by a former British intelli-
gence agent alleging both
that the Russian government
holds compromising infor-
Shortest Term
Michael Flynn resigned as the White House national security adviser
Monday, serving 24 days. National security adviser tenure, by days
Appointed by Adviser
Eisenhower Robert Cutler
Dillon Anderson
William Jackson*
Robert Cutler
Gordon Gray
Kennedy McGeorge Bundy
Johnson Walt Rostow
Nixon Henry Kissinger
Ford Brent Scowcroft
Carter Zbigniew Brzezinski
Reagan Richard Allen
William Clark
Robert McFarlane
John Poindexter
Frank Carlucci
Colin Powell
G.H.W. Bush Brent Scowcroft
Clinton W. Anthony Lake
Samuel Berger
G.W. Bush Condoleezza Rice
Stephen Hadley
Obama James Jones
Thomas Donilon
Susan Rice
Trump Michael Flynn
*Served as the national security adviser during his time as special assistant to the president
Source: Congressional Research Service
familiar with the discussions.
At that point, acting Attorney
General Sally Yates, a holdover
from Mr. Obama’s administra-
tion, discussed the issue with
other officials, including FBI
Director James Comey, who
convinced her to wait a bit lon-
ger before alerting the White
House, so that their investiga-
tion could develop more infor-
mation, these people said.
A week after Mr. Pence’s
statement, The Wall Street
Journal reported that U.S. in-
telligence agencies were inves-
and another person familiar
with the matter.
Adm. Harward retired from
the Navy in 2013 and is cur-
rently chief executive of Lock-
heed Martin Corp.’s operation in
the U.A.E.
He is being considered
alongside Keith Kellogg, the re-
tired three-star Army general
who took over as acting na-
tional security adviser late Mon-
day, and former Central Intelli-
gence Agency Director David
Petraeus, a retired four-star
Army general, according to ad-
ministration officials.
The deliberations mean that
the high-level national security
post is all but certain to stay in
the hands of a former military
officer, continuing President
Donald Trump’s reliance on re-
tired top-level brass for his na-
tional security apparatus.
9 O I X X ****
mation on Mr. Trump and
that Trump allies aided the
Russians in hacking into
Democratic email accounts
during the campaign.
The inquiry can intensify
in several ways. Democrats
are pressing for a joint
House-Senate intelligence
committee inquiry, or the
formation of a select com-
mittee specifically charged
with investigating Russian
interference in the election.
Either route would signifi-
cantly increase the profile
and resources devoted to
getting to the bottom of Rus-
sia’s role, and, by extension,
any connection to the Trump
campaign.
Days in office
740 days
518
129
533
934
1,865
1,025
2,478
444
1,462
348
651
779
356
356
424
1,461
1,514
1,408
1,464
1,455
626
997
1,299
24
THE WALL STREET JOURNAL.
tigating communications be-
tween Mr. Flynn and Mr.
Kislyak. In comments on Jan.
23, Mr. Spicer said the two
had discussed four other top-
ics, including a planned phone
call between the presidents of
the two countries, but not the
issue of sanctions.
Some U.S. intelligence offi-
cials grew uneasy at the possi-
bility that Russian authorities
could, in theory, blackmail Mr.
Flynn at some future time by
threatening to reveal the true
nature of the discussions,
If Adm. Harward is chosen,
his selection stands to increase
Mr. Mattis’s political influence
within the Trump administra-
tion. The secretary of defense
has been trying to place Adm.
Harward in a White House job
since last month, according to
the U.S. official and the person
familiar with the staffing deci-
sions, who both said the Penta-
gon chief wanted his longtime
protégé as “eyes and ears” in
the White House.
Adm. Harward was recently
at the White House interview-
ing for a senior staff position on
the National Security Council
and had been on a list of candi-
dates to serve as undersecre-
tary of defense for intelligence,
the U.S. official said.
The departure of Mr. Flynn
opens up a more influential job.
It also provides an opportunity
THE WALL STREET JOURNAL.
Meanwhile, the Trump
White House faces the chal-
lenge of bringing more disci-
pline to the organization.
There are multiple power
centers within the White
House, but it may be that
Mr. Pence will emerge from
the Flynn episode as a par-
ticularly important one.
As the top Trump official
with the deepest experience
in Washington, Mr. Pence
has always had the potential
to emerge as a dominant
player, internally and exter-
nally.
The second figure at this
turning point is Mr. Priebus.
PABLO MARTINEZ MONSIVAIS/ASSOCIATED PRESS
A White House chief of staff,
as the person sitting at the
edge of the Oval Office with
his hands on paperwork and
schedules, usually is in the
best position in the long run
to emerge as a major figure.
That hasn’t been the case
so far with Mr. Priebus, in
part because Mr. Trump re-
portedly has only recently
indicated that he wants him
to exert that kind of control.
If more choppy waters lie
ahead, the president may
discover he needs a firmer
hand from his chief of staff,
and Mr. Priebus’s challenge
will be to step up to meet
that need.
O
ne advantage for Mr.
Trump is that he is
only now getting his
full A team on the field: Rex
Tillerson, Jim Mattis and
Steven Mnuchin have been
sworn in as secretaries of
state, defense and Treasury,
respectively. With them in,
and Mr. Flynn out, a new dy-
namic is about to form, and
perhaps at a time when that
is what the president needs
and wants.
these people said. After Mr.
Spicer’s public comments
about Mr. Flynn on Jan. 23,
FBI agents interviewed Mr.
Flynn directly about his con-
tacts with the Russian ambas-
sador, these people said.
The FBI interview cleared
the way for Ms. Yates to then
raise the issue with the White
House, officials said. On Jan.
26, she approached Donald
McGahn, the White House
counsel, about the issue. She
warned Mr. McGahn that in-
tercepted communications
contradicted Mr. Flynn’s ac-
count of the discussions, and
that White House officials had
conveyed those misstatements
to the public.
According to Mr. Spicer, Mr.
McGahn quickly took the new
information to the president.
After Ms. Yates relayed the
concerns, some intelligence of-
ficials waited for White House
officials to issue a new state-
ment—to correct the public re-
cord in some way about Mr.
Flynn’s contacts with the am-
bassador, according to people
familiar with the matter.
As time went on, it seemed
to Justice Department officials
that the White House didn’t
plan to do so, these people
said.
Mr. Trump fired Ms. Yates
the Monday after she contacted
the White House because she
had declined to defend an exec-
utive order on refugees and vis-
itors to the U.S.
With Mr. Flynn’s resigna-
tion, the White House named
Keith Kellogg, the chief of staff
at the National Security Coun-
cil who advised Mr. Trump
during the 2016 campaign, as
acting national security ad-
viser.
—Shane Harris,
Byron Tau, Siobhan Hughes
contributed to this article.
for Mr. Mattis to make inroads
in a White House that so far
has been dominated by cam-
paign-trail aides who have per-
sonal relationships with Mr.
Trump.
Adm. Harward, who has run
Lockheed’s operation in the
U.A.E. since his retirement from
the Navy, served on the Na-
tional Security Council in 2005
as part of a military tour under
President George W. Bush.
The son of a U.S. Navy
sailor, Adm. Harward grew up in
Iran in the years before the
1979 revolution, attending the
Tehran American School, while
his father served there. He
learned Persian, according to of-
ficers who served with him.
Adm. Harward didn’t re-
spond to requests for comment
on this article.
—Paul Sonne, Shane Harris
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
THE WALL STREET JOURNAL. * * * * Wednesday, February 15, 2017 | A5

U.S. NEWS

Donald Trump’s
First 100 Days
Theadministration’slatest
actionsandagendaataglance
TUESDAY
u Links to Russia: In the
wake of Michael Flynn’s resig-
nation as President Donald
Trump’s national security ad-
viser, lawmakers on both
sides of the aisle demanded
further investigations into ties
between Mr. Trump’s team
and Russia.
u Regulation changes: Mr.
Trump signed legislation re-
pealing a rule requiring energy
firms to report payments to
Flynn Is First Casualty of Turmoil
In just a few weeks, Jared Kushner, the president’s
son-in-law and top adviser,
new administration is later called Mr. Ruddy and
sidetracked by lapses, briefed him on plans to im-
prove communications going
attacked by allies forward. The media executive
now has reversed his opinion
BY MICHAEL C. BENDER of the White House team.
AND REBECCA BALLHAUS Even for a White House that
has been in nearly constant
WASHINGTON—Dining at damage control, Mr. Flynn was
his oceanside resort in Florida a consistent flashpoint.
on Friday, President Donald Two days before Mr.
Trump was surprised to learn Trump’s inauguration, Mr.
that National Security Adviser Kushner and senior adviser
Mike Flynn was sitting at a Steve Bannon took a red-eye
nearby table, a person familiar flight from New York to Wash-
with the event said. ington to ease concerns about

foreign governments for the
right to develop oil, gas and
mineral assets. It is the start
of a GOP effort to roll back
Obama-era rules.
u Christie lunch: The presi-
dent had lunch with New Jer-
sey Gov. Chris Christie and his
wife. The White House said
they discussed combating
drug use, but speculation con-
tinued about whether he is
being considered for a job.
u Ethics: A nonpartisan gov-
ernment ethics agency has
recommended that the White
House investigate and con-
sider disciplining Kellyanne
Conway, a senior adviser to
Mr. Trump, after she en-
dorsed his daughter’s fashion
line in a television interview.
WHAT’S AHEAD
Mr. Trump is scheduled to
travel to Charleston, S.C., on
Friday to attend the rollout of
a new Boeing Co. aircraft, the
first 787-10 Dreamliner.
QUOTES
“Yes, Gen. Flynn does enjoy
the full confidence of the
president.”
—Ms. Conway,
on MSNBC Monday afternoon
Mr. Trump is “a very loyal
person, and by night’s end
Mike Flynn had decided it
was best to resign.”
—Ms. Conway
on NBC Tuesday morning
“What is he doing here?”
the president said, describing
the man who was once at the
center of his political orbit as
“very controversial.”
The moment epitomizes
how quickly fortunes can
change amid the chaos that
has defined the opening act of
Mr. Trump’s presidency. In just
a few weeks, the nascent ad-
ministration is being weighed
down from within, sidetracked
by dishonesty and potential
ethical lapses as well as at-
tacks from his own supporters
and fellow Republicans.
Mr. Flynn on Monday be-
came the first casualty of that
chaos, resigning as head of the
National Security Council after
he lost the president’s trust by
failing to fully disclose his con-
versations with Russian offi-
cials to senior White House of-
ficials, including Vice
Labor Pick Faces Tough Questions on Tax Delay
WASHINGTON—Senate ap-
proval of Andy Puzder to lead
the Department of Labor will
hinge in large part on his tes-
timony in a confirmation hear-
By Kristina Peterson,
Natalie Andrews
and Eric Morath
ing Thursday, as an unusually
large number of GOP senators
are reserving judgment until
they hear his explanation of
Former National Security Adviser Mike Flynn, shown last week, resigned on Monday.
President Mike Pence.
“It’s a dysfunctional White
House, and nobody knows
who’s in charge,” Sen. John
McCain (R., Ariz.) told report-
ers on Tuesday.
Several congressional com-
mittees are investigating the
possible role that Russia
played in the 2016 elections. In
addition, the Oversight Com-
mittee has begun examining is-
sues related to conflicts of in-
terest and protection of
classified information in the
new White House.
The administration’s senior
ranks are creating headlines of
several sensitive matters.
Mr. Puzder, a fast-food ex-
ecutive, is expected to face ex-
tensive questioning at the
Health, Education, Labor and
Pensions Committee over his
delay in paying taxes on an
undocumented worker he em-
ployed as a housekeeper and
on his former wife’s allega-
tions of domestic abuse, which
she later recanted. Similar tax
issues have derailed nominees
in previous administrations.
their own as they jockey for
power and influence with the
president.
Kellyanne Conway, a senior
adviser, faces calls for an eth-
ics investigation and possible
disciplinary action. The Office
of Government Ethics wrote to
the White House on Tues-
day that there was “strong
reason” to believe Ms. Conway
violated ethics rules for en-
dorsing the product line of Mr.
Trump’s daughter during a
television interview.
Ms. Conway also appeared
to be out of the loop, going on
television Monday to declare
Mr. Puzder can afford no
more than two GOP defections
in the Senate, where Republi-
cans hold a 52-48 majority.
While no GOP senator has op-
posed the nomination, a num-
ber have fallen short of a full
endorsement. So far, no Demo-
crat has supported him.
“There are many issues that
have been raised about him,
and I’m sure that all of them
will be thoroughly addressed
in the hearing,” Sen. Susan
CARLOS BARRIA/REUTERS
Mr. Flynn from incoming cabi-
net members, including even-
tual Secretary of State Rex Til-
lerson and Defense Secretary
Jim Mattis.
The administration later in-
stalled Keith Kellogg as Mr.
Flynn’s staff chief and elevated
that the president had “full the role of homeland security
confidence” in Mr. Flynn only adviser, Tom Bossert, to give
to be contradicted within the him equal sway inside the
hour by press secretary Sean White House as Mr. Flynn.
Spicer, who said the president On Tuesday, Mr. Kellogg,
was still evaluating the na- who was named interim na-
tional security adviser’s status. tional security adviser follow-
Chief of Staff Reince Prie- ing Mr. Flynn’s resignation, led
bus also found himself with an all-hands meeting of Na-
unwanted attention tional Security Council staff.
when Newsmax Chief Execu- The message was direct and
tive Christopher Ruddy, one of simple, said one attendee:
the president’s friends and a Keep working hard, and please,
member of the Mar-a-Lago don’t quit.
oceanside resort, on Sunday —Peter Nicholas, Damian
talk shows expressed frustra- Paletta, Shane Harris
tion with Mr. Priebus’s perfor- and Richard Rubin
mance. Messrs. Priebus and contributed to this article.
Collins of Maine, a centrist Re- Mr. Puzder didn’t pay taxes
publican, told reporters this on the housekeeper until Mr.
week. “I expect a very long Trump nominated him in De-
hearing.” cember. Mr. Puzder’s spokes-
Even some members of the man has said he wasn’t aware
Senate GOP leadership said of the housekeeper’s immigra-
Tuesday they would wait to tion status in the four to five
hear what Mr. Puzder says. years she worked part-time
Sen. John Thune (R., S.D.) for his family.
said he would “wait and see Her employment was termi-
what his explanation is on nated after Mr. Puzder discov-
Thursday.… He’s going to have ered she was an illegal immi-
a chance to answer a lot of grant about five years ago, the
those questions.” spokesman said.

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A6 | Wednesday, February 15, 2017 NY * *** THE WALL STREET JOURNAL.

WORLD NEWS
High Stakes for Netanyahu-Trump Talks
Israeli premier begins eased sanctions on Iran.
The Israeli leader has kept
Washington meetings uncharacteristically quiet be-
as president tempers fore his meeting at the White
House. Mr. Trump’s mixed sig-
some favorable stances nals on his position on Jewish
settlements have particularly
Israeli Prime Minister Benja- put the Israeli leader in a bind.
min Netanyahu began meetings Israeli officials said Mr. Netan-
in Washington Tuesday ahead of yahu doesn’t want to get ahead
a critical summit with President of Mr. Trump’s own position,
Donald Trump that officials in after years of clashes with Mr.
both countries hope will clarify Obama.

GALI TIBBON/AGENCE FRANCE-PRESSE/GETTY IMAGES

the new U.S. administration’s
policies in the Middle East.
By Rory Jones in Tel
Aviv and Carol E. Lee
in Washington
Mr. Trump made lofty
promises during his campaign,
such as pledging to move the
U.S. Embassy in Israel from Tel
Aviv to Jerusalem if he was
elected, effectively recognizing
Israel’s claim to the holy city
as its capital. Relations are
seen as ripe for a reset after
eight years of tensions with
the Obama administration over
settlements and the deal to re-
strain Iran’s nuclear program.
Yet as Mr. Trump tempers
some of the campaign positions
Mr. Netanyahu cheered, the Is-
raeli leader heads into their
White House meeting on
Wednesday under pressure from
The Israeli leader may also
be trying to navigate through
the competing interests of his
pro-settlement right-wing co-
alition partners, who call for
Israel to annex parts of the
West Bank, and the interna-
tional community insisting set-
tlement won’t be tolerated.
Conservative Israeli lawmak-
ers in the prime minister’s gov-
ernment last week put forward
a law, which parliament passed,
to legalize thousands of Jewish
Israeli Prime Minister Benjamin Netanyahu has received mixed signals from President Donald Trump about Jewish settlements. settler homes in the West Bank
on land Palestinians claim for a
hard-liners at home to abandon after their early efforts to fore- Ross, a veteran U.S. diplomat in On Iran, the president has future state. The law followed
his commitment to a two-state shadow new, warmer relations Israeli-Palestinian peace talks. adopted new sanctions in re- government announcements of
solution to the Israeli-Palestin- between the two countries. Mr. Trump has now put off sponse to a recent ballistic the construction of more than
ian conflict—a commitment the “I think both President moving the embassy from Tel missile test. At the same time, 6,000 units in settlements.
U.S. has long advocated. Trump and Prime Minister Ne- Aviv and said settlements his administration has signaled Palestinian Authority Presi-
The dynamic complicates tanyahu have a very big stake could hamper efforts to reach it won’t unravel the nuclear dent Mahmoud Abbas has con-
efforts to restart Israeli-Pales- in wanting to demonstrate that an Israeli-Palestinian peace deal as Mr. Trump promised demned the settlement an-
tinian peace talks and poten- whatever the problems were agreement, telling an Israeli during the campaign. Mr. Ne- nouncements and the new law
tially sets the U.S. and Israeli with the last administration, news outlet last week that tanyahu has been a vehement as an aggression against the
leaders on a collision course they’re now gone,” said Dennis they “don’t help the process.” opponent of the accord, which Palestinian people.

Graft Probes Undermine Israeli Leader

BY RORY JONES while in office, and in a second then he might be forced to ing to a poll by Channel 2, a
GALI TIBBON/AGENCE FRANCE-PRESSE/GETTY IMAGES

TEL AVIV—Corruption
probes have left Israeli Prime
Minister Benjamin Netanyahu
weakened at home on the eve
of his first summit with Presi-
dent Donald Trump.
The scandals have dented
Mr. Netanyahu’s standing, ac-
cording to polls, and embold-
ened opposition politicians to
seek his ouster.
Police have questioned the
prime minister several times
An Israeli police car outside Mr. Netanyahu’s residence in January. in recent weeks about whether
The prime minister is being investigated in two criminal cases. he received unlawful gifts
case about whether he at-
tempted to negotiate favorable
coverage with a top Israeli
newspaper. An opposition law-
maker is petitioning Israel’s
highest court to order authori-
ties to open a third criminal
investigation into a potential
conflict of interest for Mr. Ne-
tanyahu in the government
purchase of submarines.
Mr. Netanyahu has denied
any wrongdoing, labeling the al-
legations a campaign by Israeli
media to force him from power.
“If Netanyahu is indicted,
step down and the process to major television station. That
replace him would begin,” said compares with 28% who think
Emmanuel Navon, a former he is being honest. The major-
parliamentary candidate for ity of Israelis believe Mr. Ne-
Mr. Netanyahu’s Likud Party tanyahu should step down if he
and a political analyst. is indicted, according to a poll
Likud lawmakers have made last week by the Israel Democ-
public statements of support for racy Institute, a think tank.
the leader. But party members Criminal charges wouldn’t
are also considering options in automatically force the pre-
case of an indictment, according mier to step down by law. But
to lawmakers in other parties. many lawmakers predict the
More than half of the public country’s second-longest-serv-
doesn’t believe the prime min- ing leader would have to re-
ister’s statements that he sign, at least temporarily, until
hasn’t broken any laws, accord- he could clear his name.

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THE WALL STREET JOURNAL.
WORLD WATCH
GERMANY
Merkel Asks Tunisia
For Help on Migrants
German Chancellor Angela
Merkel on Tuesday urged Tunisia
to take back more of its nation-
als who fail to secure asylum in
Berlin’s latest effort to reduce
the number of undocumented
migrants in the country.
“We have to tell someone
who doesn’t commit to volun-
tarily departure that he must
also do it involuntarily,” Ms.
Merkel said at a press confer-
ence with Tunisian Prime Minis-
ter Youssef Chahed.
However, Mr. Chahed said
most Tunisians who leave Ger-
many should do so voluntarily.
After just under a million asylum
seekers entered the country last
year, Berlin has launched an ef-
fort to increase the low number
of failed applicants who can be
deported.
—Ruth Bender
EUROZONE
Growth Was Weaker
Than First Reported
Economic growth in the euro-
zone was weaker than previ-
ously reported in the fourth
quarter of 2016, but the underly-
ing growth momentum remained
robust as the bloc prepares to
face numerous political uncer-
tainties.
The eurozone economy grew
at a quarterly rate of 0.4%, or
1.6% in annualized terms, the Eu-
ropean Union’s statistics agency,
Eurostat, said Tuesday. The
quarterly growth figure was
lower than an initial estimate of
0.5% released on Jan. 31.
The EU said Monday that the
eurozone has shown resilience to
shocks, raising its 2017 growth
forecast to 1.6%.
—Nina Adam
TRIAN
Continued from Page One
on Trian’s stake on Tuesday.
Shares of the Cincinnati-based
company, which have lagged
behind the broader market for
the past year, jumped 3% in
late trading to $90.40.
P&G has been slashing costs
and shedding dozens of brands
to refocus on its biggest busi-
nesses. But it has struggled to
boost sales growth as it bat-
tles a sluggish global economy,
price pressures and competi-
tion from internet upstarts.
Historically, Trian—known
for publishing detailed reports
on its investment targets—has
focused on companies it be-
lieves need tighter focus on
core operations, as well as on
cutting costs and management
bureaucracy. As with other ac-
tivists, it also is known for ad-
vocating for asset sales or
breakups. Trian sometimes
works quietly from inside the
boardroom and at other times
STOCKS
Continued from Page One
Industrial Average climbed
92.25 points, or 0.45%, to close
at 20504.41.
One reason for such investor
optimism: After years of hack-
ing away at expenses—shed-
ding businesses, cutting staff
and investing in technology
that can be ramped up and
down cheaply—expenses are
near all-time lows across Wall
Street. That means that if reve-
nue does grow as many inves-
tors expect, the payoff could be
especially big.
Essentially, all the belt-tight-
ening at banks means each ex-
tra dollar of revenue should be
more profitable than the last.
“They’ve come out of this thing
lean and mean,” said Ed Wa-
chenheim of Greenhaven Asso-
ciates, a $6 billion investment
firm that counts Goldman, Citi-
group Inc. and J.P. Morgan as
its three biggest holdings. Once
revenue starts increasing,
“there’s a ton of upside,” he
said.
Hopes for such positive “op-
erating leverage”—when reve-
nue grows at a faster pace than
expenses—were in evidence
during the bank-earnings sea-
son that wrapped up last
month. The phrase was men-
tioned 11 times on Bank of
America’s call with analysts,
nine times on Goldman’s and
six times on Citigroup’s.
Indeed, expenses at the six
biggest U.S. banks in 2016 are
down 13% from 2013, while rev-
enue is roughly flat. Savings are
* * * *
Kim Jong Un’s Half-Brother Slain
North Korean leader Kim
Jong Un’s estranged half-
brother Kim Jong Nam was
killed under mysterious cir-
cumstances in Malaysia, South
Korea’s government and Ma-
laysian police said, eliminating
a reform-minded member of
the dynasty who was once
considered next in line to rule
By Jonathan Cheng in
Seoul and Yantoultra
Ngui in Kuala Lumpur
the isolated country.
Kim Jong Nam was appar-
ently attacked Monday in the
departures area of Kuala Lum-
pur International Airport 2,
where he was boarding a flight
to Macau, said the state police
chief, Abdul Samah Mat. It
was unclear who was behind
the attack.
“His head was wrapped in
cloth believed to contain some
kind of a liquid,” Mr. Abdul Sa-
mah said. He said an unidenti-
fied woman was reported to be
near Kim Jong Nam at the
time of the incident, and that
the woman’s whereabouts
weren’t known.
The victim was pronounced
dead en route to a nearby hos-
pital, and an investigation and
autopsy were under way, po-
lice officials said.
South Korea’s Ministry of
Unification at a press briefing
on Wednesday in Seoul con-
firmed the murder of Kim
Jong Nam, adding that Seoul
was working with the Malay-
sian government on the case.
Kim Jong Nam, 45 years old,
was the only son of second-
generation leader Kim Jong Il
and a North Korean actress
who became his mistress.
wages public battles for influ-
ence. Trian didn’t speak with
P&G executives about its invest-
ment before disclosing it pub-
licly, people familiar with the
matter said.
This isn’t the first time P&G
has faced an activist. In 2012,
William Ackman’s Pershing
Square Capital Management LP
invested in the company and
called for a CEO change amid
slumping profits. A year later,
Robert McDonald was replaced
by his old boss, A.G. Lafley, who
remained chairman until last
year. Company veteran David
Taylor is now chairman and CEO.
Mr. Taylor, who took over in
November 2015, has opted
against launching new brands
or buying a hot startup.
“I understand the desire for
faster growth and for a single-
minded short-term objective,
but we’ve seen this movie be-
fore, and frankly, we don’t
want to live the sequel,” Mr.
Taylor said at a meeting with
analysts in November after his
first year at the helm.
The company’s closely
A Whisker Away
After more than a decade, Bank of America’s market value is on the
cusp of retaking its all-time high.
$250 billion
200
150
100
50
0 Goldman shares, meanwhile,
2004 ’06 ’08
Source: FactSet
coming from all corners of the
financial firms.
Last year, the six biggest U.S.
banks booked a combined 23
cents of every dollar of revenue
as profit, up from 15 cents five
years ago.
Employees at Morgan Stan-
ley are taking a nickel less out
of each revenue dollar than
they did in 2010. Bank of Amer-
ica cut the equivalent of 15 Em-
pire State Buildings from its
real-estate footprint over five
years. J.P. Morgan stopped pay-
ing for employees’ BlackBerrys.
At Goldman, noncompensa-
tion expenses are their lowest
since 2007. “This represented a
lot of work,” Goldman Chief Ex-
ecutive Lloyd Blankfein said at
an industry conference last
week. “We’ve taken a lot of
costs out—not to hunker down,
but to give ourselves a lot of
operating leverage, frankly.”
Investors hope profits will
Doted on in childhood by his
father and educated in Swit-
zerland, he was widely re-
garded as the heir apparent to
the country founded by his
grandfather after World War II.
But he is believed to have
fallen out of favor with his fa-
ther in 2001 after he was
caught trying to enter Japan
on a false Dominican passport.
He had told authorities at the
time that he was planning to
visit Tokyo Disneyland.
Largely as a result of the
flap, North Korea watchers
ruled out Kim Jong Nam as
the successor to Kim Jong Il,
and attention shifted instead
to Kim Jong Chol and Kim
Jong Un, the North Korean
leader’s sons through another
woman who became the
leader’s companion.
After Kim Jong Il’s death in
2011, Kim Jong Un ascended
and Kim Jong Nam largely
faded from view.
The death of Kim Jong Nam
comes amid uncertainty about
international strategy regard-
ing North Korea, with the ar-
rival of President Donald
Trump’s administration and a
political scandal in South Ko-
rea that could bring elections
in the coming months and a
new leader who favors closer
ties with the North.
Over the weekend, North
Korea test-fired a new inter-
mediate-range ballistic missile,
highlighting technological de-
velopments that could en-
hance the stealth and reliabil-
ity of future long-range
missile launches.
Kim Jong Un is believed to
have consolidated control of
the country since his ascen-
sion nearly five years ago. In
FROM PAGE ONE
Nelson Peltz
watched organic sales growth,
which excludes acquisitions or
divestments as well as cur-
rency swings, has been stuck
between 1% and 3% in recent
years. In January, P&G in-
creased its target for the year
ending in June to between 2%
and 3%—though that is still
well below prerecession levels.
Bernstein analyst Ali Dibadj
has long advocated a breakup
of P&G. He said P&G’s resis-
’10 ’12 ’14 ’16
THE WALL STREET JOURNAL.
gain even further if revenue
growth materializes. Bank of
America shares, for instance,
are up more than 41% since the
election, the most of any big,
U.S. bank.
That is partly a function of
its focus on U.S. consumers and
its large pool of rate-sensitive
mortgage securities. These tie
its fortunes more closely to po-
tential increases in U.S. interest
rates than many peers.
The share-price gains led
Bank of America’s stock to
trade at book value, or the
firm’s intrinsic worth, for the
first time since October 2008.
The shares were valued below
this level as the bank was
sucked into the financial crisis
and then as it struggled with
legal fines, credit losses and
lackluster returns since then.
Despite the stock’s higher
valuation, the share price is still
less than half of its precrisis
WORLD NEWS
Family Dynasty
Kim Jong Nam, who died on Monday, was once considered
the heir apparent to North Korea's ruling Kim dynasty.
Kim Yong Ju
Younger brother of
Kim Il Sung, one-time Kim Il Sung
heir apparent Founder of North Korea
Kim Man Il
Died at age 5 Kim Jong Il
Second-generation leader
Ri Sol Ju
Kim Jong Un
Third-generation leader
Kim Jong Un’s siblings
Kim Jong Chul Kim Yo Jong
Low-profile older Appears frequently
brother (living in with North Korean
North Korea) leader
late 2013, he ordered the exe-
cution of his uncle, Jang Song
Thaek, and has begun to lay
the trappings of a cult of per-
sonality along the lines of his
father and grandfather.
tance to change may prompt
Trian to take a more active
role. “We have always tried to
keep P&G’s feet to the fire as
we don’t think it’s living up to
its potential,” he said. “We can
imagine Trian sees the same
PATRICK T. FALLON/BLOOMBERG NEWS
thing and will do the same.”
P&G shares have gained
5.7% this year including divi-
dends, outpacing the S&P
500’s 4.2% return, but the
share’s price has trailed the
benchmark over the past one-
year and three-year periods.
P&G fared better than many
of its rivals in the second half
of 2016, capturing market share
in many categories. Analysts
say the environment is tough
for consumer-staples sellers,
also because of macroeconomic
factors like currency volatility.
Several big research firms have
downgraded P&G shares, in-
cluding Goldman Sachs Group
Inc., which put a sell rating on
the company in January.
P&G, General Electric Co.
and some other American cor-
porations are rushing to shed
underperforming divisions and
peak of $54.90. And the bank’s
return on equity, a closely
watched measure of profitabil-
ity, is still below the 10% level
investors typically demand.
Citigroup is now the only
one of the big, U.S. banks to
trade at a discount to book
value, at about 81% of this level,
according to FactSet data. Even
so, it, too, hit a milestone Tues-
day: Stock options granted to
executives in 2011 expired on
Tuesday “in the money,” that is,
exercisable at a gain, the first
time that has happened since
August 2007.
closed at an all-time high of
’17 $249.46, beating by more than
a dollar a share the previous re-
cord set on Halloween 2007.
Shares are up 37% since the
election.
Its fuel is different than
Bank of America’s. Goldman,
with few consumer-facing busi-
nesses and a smaller portfolio
of loans, won’t get the same
boost from higher interest
rates.
Rather, investors are betting
on Goldman’s once-mighty
trading desk, which has been
hurt by postcrisis regulations
and quieter markets. Volatility
has returned, helped by diverg-
ing interest rates around the
world, swings in stock-market
sectors and the occasional pres-
idential tweet.
President Donald Trump has
promised to trim trading regu-
lations that ban some lucrative
trading activities and require
banks to hold extra capital.
A Goldman alumnus, Gary
Cohn, is the face of the admin-
istration’s deregulation push.
Wednesday, February 15, 2017 | A7
Kim Jong Suk
Mother of Kim Jong Il
Kim Sung Ae
Second wife of
Kim Il Sung
Jang
Song
Thaek
Executed
in 2013
Kim Kyong Hui
Younger sister
of Kim Jong Il
Kim Jong Un’s half-siblings
Kim Sul Song Kim Jong Nam
Ruling party Half-brother of
official (in North Kim Jong Un,
Korea) died on Monday
Note: Some family members
have been omitted for simplicity.
Photos: Three Lions/Getty Images (Kim Il
Sung); AFP/Getty Images (Kim Jong Il);
Reuters/KCNA (Kim Kyong Hui, Kim Jong
Un); Kyodo News/Getty Images (Kim Jong
Chul); EPA/KCNA (Kim Yo Jong); JoongAng
Ilbo/Associated Press (Kim Jong Nam)
Source: Staff reports
THE WALL STREET JOURNAL.
It would be difficult to deter-
mine a motive in the killing of
Kim Jong Nam if it is found that
North Korea was responsible.
“We see Kim Jong Un be-
coming more and more confi-
slim down after years of bulk-
ing up through acquisitions
outside their core expertise.
The change of heart among
top executives was seen as an
admission that their compa-
nies had grown too big and
bloated to manage effectively,
which caused their stock
prices to languish in recent
years. It also came as activist
investors used their war
chests to pressure boards to
move more quickly.
P&G spent $80 billion over
two decades scooping up
brands including Gillette ra-
zors, Duracell batteries and
Iams pet food, only to end up
selling some of them to focus
on boosting sales of Tide,
Pampers and other mainstays.
In October, P&G completed the
$11.6 billion sale of dozens of
beauty brands, including Cov-
erGirl makeup and Clairol hair
dye, to Coty Inc.
The activist world has been in
guessing mode on the new Trian
position, particularly since Mr.
Peltz said in December that he
and his partners, Ed Garden and
dent in his position and in his
office, which is why he’s more
comfortable to allow for these
very public executions,” said
Anwita Basu, an analyst for
the Economist Intelligence
Unit. “The young leader is be-
coming more powerful.”
In recent months, the coun-
try has suffered a number of
high-profile defections, includ-
ing Thae Yong Ho, the North
Korean deputy ambassador in
London.
These defectors, among
North Korea’s elite, have led
some North Korea watchers to
suggest that the country’s sys-
tem is beginning to fray at the
edges, though the country has
weathered high-profile defec-
tions in the past.
In a book that Kim Jong Nam
published in 2012 with a Japa-
nese reporter, Yoji Komi, he
said he pushed internally for re-
form and market opening,
which made him an object of
suspicion in Pyongyang.
After the birth of Kim Jong
Un and his sister Kim Yo Jong,
Kim Jong Nam told the re-
porter that he had lost the af-
fection of his father, who di-
verted his devotion to his
younger half-siblings.
In a statement on Kim Jong
Nam’s death, The Royal Malay-
sia Police said the deceased
man had a North Korean pass-
port identifying him as 46-
year-old Kim Chol. Police
didn’t address the discrepancy
in identification, though Kim
Jong Nam was known to travel
on false passports.
Kim Jong Nam’s death leaves
at least four known living third-
generation descendants of state
founder Kim Il Sung, including
leader Kim Jong Un.
Peter May, had started buying a
new stock. At that time, Mr.
Peltz told CNBC he hoped to talk
to the board and management
before the investment became
public, as the firm has tried to
position itself as a constructive,
if opinionated, shareholder.
Trian didn’t reveal a new
investment in all of 2016, fo-
cusing instead on its portfolio
companies, after making three
new investments in 2015. One
of them was then its biggest
ever, a $2.2 billion stake in GE.
But it was also ramping up
for this new bet by fundraising
and selling some other stakes.
During 2016, it sold a $1.8 bil-
lion investment in PepsiCo, af-
ter a three-year campaign that
included a bid to break up the
soda and snack maker, and a
$383 million position in money-
manager Legg Mason Inc.
Trian raised a specific fund
for the P&G position in recent
months, tapping large invest-
ment pools like sovereign-
wealth funds and pension
funds, people familiar with the
matter have said.
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
A8 | Wednesday, February 15, 2017
NATO AlliesinU.S. SightsOverSpending
Meetings in Europe
this week could see
Germany under
pressure to do more
Last month, Germany began
deploying an army battle group
to Lithuania, the first of the
North Atlantic Treaty Organiza-
tion troops to arrive to bolster
the defenses on the alliance’s
eastern border with Russia.
By Julian E. Barnes
in Brussels
and Anton Troianovski
in Berlin
It isn’t an overwhelming dis-
play of force. The initial German
contingent is 460 troops, sup-
plemented by a few hundred
soldiers from Belgium, the
Netherlands, Luxembourg and
Norway.
Some current and former
American officials derided the
unit as a “Frankenbattalion,”
calling it an example of Ger-
many’s failure to shoulder its
fair share of the NATO burden.
While Germany defended its
plan and the U.S. has dropped
its official complaints, it illus-
trates the tensions coursing
through the alliance as the
Trump administration prepares
to push Europe for more de-
fense spending.
“We have been complaining
since 1949 that European allies
aren’t doing enough,” said Jim
Townsend, who served in the
Pentagon during the Obama ad-
ministration. “But for Germany
it has been particularly prob-
lematic in the last 10 years.”
Russian aggression
NATO is at a crossroads.
Having helped keep the peace in
Europe for more than 70 years,
the 28-nation alliance is being
sharply challenged by Russian
aggression in Ukraine, and by
President Donald Trump, who
has called the organization ob-
solete and argued it should fo-
cus on counterterrorism.
This week, top officials from
the new U.S. administration
come to Europe for a NATO
meeting in Brussels and a secu-
rity conference in Munich
where questions of the group’s
missions and finances will be on
sharp display. How member
countries resolve their differ-
ences will go a long way toward
determining NATO’s future and
usefulness.
Mr. Trump has signaled he
will put new muscle behind
America’s long-standing de-
mand that Europe spend more
on defense. “We only ask that
all of the NATO members make
their full and proper financial
contributions to the NATO Alli-
ance, which many of them have
not been doing,” Mr. Trump
said in a speech last week at
MacDill Air Force Base in
Tampa.
On Tuesday, NATO Secretary-
General Jens Stoltenberg an-
nounced that NATO allies in Eu-
rope and Canada raised their
defense spending by $10 billion
last year, a 3.8% increase that is
bigger than allied officials ini-
tially expected.
The U.S. spends $664 billion
annually on its military, or 3.61%
of GDP, tops in both categories
of any NATO country. Spending
by other NATO members ranges
from nothing, by Iceland, to
$60.3 billion by the U.K.
Germany, the economic pow-
erhouse of Europe, spends
around $40 billion, or 1.2% of
its gross domestic product, on
TEST
Continued from Page One
who run afoul of this “rare phe-
nomenon” make bookings by
phone or sign up for the air-
line’s frequent-flier program,
which would hold more identi-
fying information in its com-
puter system.
Jeff Sample got caught last
year in a Kafkaesque standoff
among his travel agent, credit-
card company and an Argentine
airline after their computers re-
fused to hold his reservation for
a flight from Buenos Aires to
Patagonia. “I know I’m not the
only Sample,” he said. “How
could it become such a big
deal?”
Often the culprit is a web
program too sensitive to poten-
tial spam accounts, said Ashley
Sheridan, a developer at a tech
company in London who has
written on his website about
how to prevent such hang-ups.
While many sites have switched
German soldiers arrive in Lithuania on Feb. 1, part of a NATO mission to bolster the defensive capabilities of the three Baltic states
defense. The U.S. has been
pushing for Germany to hit 2%
of its GDP on defense spending
for more than a decade.
More recently, Chancellor
Angela Merkel has been trying
to push her pacifist-minded
country to close the gap. In No-
vember, the German Parliament
made the biggest increase in
military spending in more than
a decade, raising the defense
budget 8% to €37 billion ($39
billion), and German govern-
ment officials say they will push
for more increases in the com-
ing years. Alliance officials note
if Germany was to meet NATO’s
2% of GDP goal, it would require
tens of billions of dollars in ex-
tra spending each year.
Administration officials, in-
cluding Vice President Mike
Pence and Defense Secretary
Jim Mattis, will come to Europe
this week to deliver a message
of reassurance, but also to note
that defense spending must
rise.
German Defense Minister Ur-
sula von der Leyen—perhaps
the German politician most sup-
portive of increased military
spending—visited Washington
on Friday to detail her country’s
defense work and called de-
mands for a larger defense bud-
get appropriate.
“It’s a fair demand,” she said
during her trip to Washington.
“If we want to jointly master
the crises in the world, namely
the fight against terrorism, and
also put the alliance on solid
footing, then everyone has to
pay their share.”
Afghan mission
Some German policy makers
say the U.S. appears to be
overly focused on the 2% num-
ber, given Germany’s engage-
ment on the ground from Af-
ghanistan and Iraq to Mali and
Kosovo.
U.S. officials said they aren’t
worried about spending for
spending’s sake but see a real
military gap—in personnel and
materiel.
Core to Europe’s defense is
the U.S. contribution. The U.S.
has 35,000 military personnel in
Europe, mostly in Germany, in-
cluding two Army infantry bri-
gades. The U.S. has bolstered its
force with a heavy tank brigade
with 3,500 troops and 87 tanks.
It also maintains tanks and ar-
tillery at sites around western
Europe.
That said, NATO plans for
to verification processes that al-
low most to confirm their iden-
tity, developers say too many
sites still check emails against
long lists of phrases that could
be fake.
“There’s a lot of lazy engi-
neering out there,” says Akin
Adebowale, co-founder of
Oxosi.com, an online
clothing retailer. His
team scrubbed out
glitches that could dis-
regard an order from a
Mr. Null, for instance,
ahead of the site’s
public launch last year.
Many newer web-
sites and computer
systems have been
built to recognize that
some common words Tom
can be names, said
Kyle Connors, a technical archi-
tect at software consultancy Ti-
vix. Older systems that have
been upgraded over time may
have missed some of those fixes.
David Books, despite being a
former computer programmer,
says he doesn’t trust computers
* *** THE WALL STREET JOURNAL.
IN DEPTH
has already started to follow
suit, moving last year to add
thousands of new military posi-
tions and refurbish scores of de-
commissioned tanks.
The U.S. military’s focus on
Germany as the potential
game-changer is in part because
of the size of its economy, but it
is also because of the quality of
its equipment.
U.S. military officers often
speak with unhidden jealousy
about German Panzerhaubitze
2000, viewed as perhaps the
most advanced artillery system
PETRAS MALUKAS/AGENCE FRANCE-PRESSE/GETTY IMAGES
of its kind.
The problem: Germany has
only about 90 of the artillery in
service, having sold off 16 to
Croatia and 21 to Lithuania. Ac-
cording to U.S. officials, German
troops must share large artil-
lery pieces for training, because
they don’t have enough to go
around.
German officials said artil-
lery pieces are sometimes un-
available because of mainte-
nance needs and that the
military is now expanding its
stock, with 12 new Panzerhaubi-
tze 2000s slated to be delivered
ground-based air defense sys- this year.
Attitude Adjustment tems, aerial refueling planes The U.S., by contrast has
and other equipment from Ger- 5,923 artillery pieces, including
The German public is starting to look more favorably on increased many, officials said. 969 of its most advanced sys-
military spending in the wake of Russia's 2014 annexation of Crimea. Some German lawmakers tem, according to the Interna-
Should defense spending be increased, reduced, or stay unchanged? have questioned if the alliance tional Institute for Strategic
is mistakenly preparing for yes- Studies. This year the U.S. will
Reduced Unchanged Increased terday’s battles. be moving a part of that arse-
“I do believe that we need to nal, a brigade worth of artillery,
80% 60 40 20 0 20 40 60% do more in terms of equipment to storage bunkers in Europe.
for the army,” said Rainer Ar-
nold, the top defense-policy ex-
2012
pert in parliament for the cen- Small numbers
ter-left Social Democrats. “But The small number of troops
we must be careful about be- deployed to Lithuania raised
2013
lieving that Europe will be de- questions among some U.S. offi-
fended in a great tank battle— cials about whether the German
that doesn’t conform with military is large enough.
2014
today’s military technology.” Lithuanian officials said they
Mr. Arnold said the 2% goal aren’t worried and pointed to
is “a utopia,” because Germany the swiftness of the German de-
2015
would struggle to spend such a ployment, which arrived ahead
large sum, and many of its of the British and Canadian
neighbors would react warily if forces headed to Estonia and
2016 Berlin dramatically increased Latvia.
defense spending. German officials argue a
80% 60 40 20 0 20 40 60% NATO officials say the new multinational battalion is a bet-
requirements are a necessary ter deterrent: Russia would
Source: Surveys conducted for the Center of Military History and Social Science of the calibration to respond to the know it would cross not one ally
German Military; most recent by Ipsos, personal interviews of 2,295 Germans May 17-June threat from Russia. Alliance of- but many if it made a move in
19, 2016. Results don't add up to 100% because responses with answer "don't know" were
excluded. ficials say they are making in- Lithuania. Allied ambassadors
THE WALL STREET JOURNAL. vestments in drones and cy- backed the German plans, and
berdefenses, but the Russian the U.S. stopped pushing the is-
military buildup must be imme- sue, saying it was settled.
diately countered with the kind Officials are hoping for a
Fair Share? of heavy military equipment change in Germany’s pacific
Estimated 2016 defense spending among NATO that will ensure Moscow real- public attitude about military
members as a percentage of gross domestic product. izes any incursion would ulti- action, shaped by the shadow of
mately fail. World War II. Polls show grow-
U.S. 3.61 To a certain extent, all of ing concern about Germany’s
Greece 2.38 NATO’s European allies have security in the wake of the
U.K. 2.21 been caught by surprise as the Ukraine crisis and high-profile
Estonia 2.16
Poland 2 threat has moved from counter- terror attacks. The German mili-
France 1.78 insurgency and low-intensity tary’s Center for Military His-
Turkey 1.56 combat to preparing to defend tory and Social Science found
Norway 1.54 against Russia. For years NATO half of Germans in a poll last
Lithuania 1.49 urged European allies to tailor year wanted the defense budget
Romania 1.48 their forces to the kind of to be increased, compared with
Latvia
Portugal
1.45
1.38 peacekeeping missions they just 19% in 2013.
Bulgaria 1.35 were conducting in Kosovo or In November, the German
Croatia 1.23 the kind of fighting and training military premiered a $7 million,
Albania 1.21 missions they conducted in Af- 82-episode reality show on You-
Germany 1.19 ghanistan. Tube called “The Recruits,”
Denmark 1.17 Germany had more than which follows the exploits of a
Netherlands 1.17
Slovak Republic 1.16 2,000 Leopard 2 battle tanks in group of 12 trainees as they
Italy 1.11 its arsenal during the Cold War navigate basic training on the
Czech Republic 1.04 and 800,000 military and civil- Parow Naval base on the Baltic
Hungary 1.01 ian personnel in its armed Sea.
Canada 0.99 forces after the Berlin Wall The slickly produced show
Slovenia 0.94
came down. Successive rounds doesn’t obscure the challenge
Spain 0.91
Belgium 0.85 of cuts whittled the military for Germany. In one episode,
Luxembourg 0.44 down to 177,000 service mem- Petty Officer Second Class Carl
0 1 2 3 4% bers, a maximum of 56,000 ci- Scholwin, who has spent 10
vilians, and a goal of just 225 years in the military, laments
Note: Iceland, while a member of the alliance, does not have a military or a defense budget. Leopard 2 tanks. that service members in his
Data for Bulgaria does not include military pensions, unlike other countries.
NATO pushed European country “don’t get the recogni-
Source: NATO THE WALL STREET JOURNAL.
countries to model their forces tion that they really should get.”
on the British, de-emphasizing Asked later by The Journal
the defense of Europe rely heav- in the event of a conflict with tanks and focusing on light de- about what it is like to return
ily on Germany, which will be Russia, according to Western of- ployable forces. Now the alli- from a mission abroad, he said:
required to have six heavy in- ficials briefed on requirements. ance has shifted gears demand- “In Germany, you get left by the
fantry brigades ready to rein- NATO is pressing for more ing the country once more build roadside. You’re not really no-
force Poland or the Baltic states tanks, long-range artillery, up its heavy forces. Germany ticed.”
at all. “It’s all automated and
people just slide through the
cracks and they don’t care,” said
the 63-year-old, adding that it
believed. The company said it
believes the process through
which Mr. Books eventually
proved himself is fair. Facebook
ple chicken tenders or salad
dressing.
Avery Blank, an attorney in
Philadelphia, said she almost
“We have a list of words
that have been excluded for use
in email addresses to mitigate
the amount of emails we send
took two years for him to per- declined to elaborate. missed out on an internship to invalid email usernames,”
suade Facebook to acknowledge The confusion predates com- during law school because Ms. Pace said. She said the
his personhood in 2013. He sent puters for some. Chuck Sample someone in the office of a Balti- bank’s technicians were work-
in copies of his driver’s license had a job two decades ago help- more city official assumed her ing to remove null from the list.
and passport but was told ing the National Cattlemen’s email was spam. “Luckily, being Brian Test, a Chicago-area IT
‘you’re not who you Beef Association with grocery- the bulldog ballerina that I am, manager and Tom Test’s youn-
say you are and this store demonstrations on how to I emailed them again and they ger brother, managed a real-
was your final appeal,’ season round roasts and chuck realized this is a real person,” world hack to keep his col-
according to Mr. steak. “I was Chuck Sample run- she said. leagues from deleting him from
Books. He then sought ning the Chuck Sampling Pro- Persistence isn’t paying for the office computer system. He
the help of Christo- gram,” says Mr. Sample, who Christopher Null, a Bay Area ordered a sheet cake with a
pher Elliott, an author said clients at the time thought journalist who says providers, picture of his face and an icing
and consumer advo- it was all a joke. including satellite radio service banner that read, “I’m Brian
cate, who publicized Now working at US Foods SiriusXM and Bank of America, Test and I’m real” and fed it to
Mr. Books’ plight on Holding Corp., a restaurant and won’t let him use his main his colleagues on a lunch break.
his blog. cafeteria supplier, Mr. Sample’s email, null@nullmedia.com. “It’s “I never got locked out of the
Facebook, which name remains a serious matter haunted me my entire adult system again,” he said.
Test calls itself “a commu- in his work life. Only two email life,” he said. His family’s original name,
nity where everyone addresses in the company di- SiriusXM representatives Testa, was changed by their
uses the name they go by in ev- rectory of nearly 25,000 em- didn’t respond to requests for great-grandfather when he em-
eryday life,” won’t approve pro- ployees include the word sam- comment. Bank of America igrated from Italy a century
files with honorifics, numbers, ple, he says. One is for spokeswoman Anne Pace said ago. “There’s an upside in that
“unusual” capitalizations, or ordering samples for custom- Mr. Null is one of hundreds of my name is unusual and there-
“offensive or suggestive words ers. “The other one is me,” said Nulls among its 40 million ac- fore memorable,” Tom Test
of any kind.” Mr. Sample. The result: Every counts holders. His problem, she said. “It might be worth a few
Mr. Books thinks his name couple of weeks, a salesperson said, is that his last name stands hassles if people remember
just seemed too generic to be emails Chuck requesting sam- alone in his email address. me.”
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
THE WALL STREET JOURNAL. Wednesday, February 15, 2017 | A9

LIFE&ARTS
WORK & FAMILY | Sue Shellenbarger

Don’t Feel Stuck: It’s Time to

Update Your Career Blueprint
How to take a more active role in making your professional life as good as it can be; Don’t wait for bad news to start planning
MANY PEOPLE go to work
contentedly enough day after
day. Thoughts of change come
only after a bomb drops in the
form of a bad review or layoff,
or boredom or frustration saps
all the fun from your job.
Don’t let this happen. We
should all have a career fitness
plan. Making a fitness plan
should be a quarterly disci-
pline, and it doesn’t have to be
a daunting chore. What works
best isn’t trying to draw a 20-
year road map. A better ap-
proach is taking a series of
small steps and pilot projects
to keep expanding your skills
and network. Here are some
signs your career plan needs a
workout:
You feel stuck in a job
that’s too limiting
Christina Coons knew it was
time for a change when her
mind began wandering while
she was teaching her middle-
school class. “It was an a-ha
moment: One day I was teach-
ing a grammar lesson and
planning out my menu for the
week at the same time,” she
says. When friends in a non-
profit group suggested Ms.
Coons volunteer to head its
marketing efforts, “I thought
it would be a great hobby,”
she says. She enjoyed the work
so much that it began distract-
ing her from grading stacks of
students’ papers.
She tried a pilot project by
seeking freelance marketing
jobs on TaskRabbit, and com-
pleted several successfully.
With help from Chicago career
coach Jody Michael, she began
setting up interviews and soon
landed a job as a marketing
specialist at a Chicago agency.
Set aside time quarterly to
reflect on whether your work
matches your evolving needs
and interests, says Pamela
Slim, a Mesa, Ariz., author and
business coach. She advises
getting away for a few hours
or more to pinpoint which
parts of your job are working
and which aren’t. What threats
do you see, such as reduced
support from a boss? What
new skills do you need?
You procrastinate on career
planning
Many people don’t do a good
job of touting their accomplish-
ments. The resulting career inertia
is “the great saboteur,” fostering
anxiety and hopelessness, Ms. Mi-
chael says.
Jenelle Francois of Chicago felt
she had hit a dead end in a previ-
ous job selling office tile. She
worked hard and her sales were
rising. She assumed she’d be rec-
ognized for it. But she wasn’t get-
ting much support or useful feed-
back from her supervisor.
With coaching from Ms. Mi-
chael, she polished her communi-
cation skills so she could describe
her achievements with confidence.
Then she mounted a job search.
She landed her dream job last year
selling designer office upholstery.
You stop working on your
personal brand
People often become known for
A FITNESS PLAN
FOR YOUR CAREER
n Take time out quarterly to
take stock of what’s working well
in your career, and what’s not.
n Focus on the next positive
step rather than trying to make
a 20-year plan.
n Ask yourself what you could
add or change on your current
job to do more of what you
want.
n Consider learning new skills or
trying freelance gigs as a way of
discovering new passions.
n Keep a career journal to help
you recall details and notice
patterns in your skills and
accomplishments.
n Build your reputation by
writing or speaking publicly
about new developments in your
field.
n Expand your network beyond
past and present colleagues to
include others in your field,
industry and region.
certain skills or roles early in their
careers, Ms. Slim says. “They con-
tinue to fall back on a tired, easy-
to-understand description of who
they are—I’m an engineer, or I’m
in accounting.” This keeps others
from knowing about new skills or
achievements, she says.
Brand updates can be brief and
casual, Ms. Slim says. Ask co-
workers what they’re working
on, then share your latest proj-
ects. Take colleagues from a
different department to lunch
to learn about their work and
discuss yours.
Ms. Michael recommends
keeping a career journal—a log
of projects you’re working on,
updated objectives and new
certifications, skills and abili-
ties you’re building. Collect sto-
ries that highlight your
strengths, leadership and team-
work.
Rob Kurtz, a senior manager
for a St. Louis tech company,
recently looked back at his
achievements and identified
strengths he has shown repeat-
edly in various jobs. That in-
cludes his ability to facilitate
discussions and set up pro-
cesses for building strong
teams. Working with David
Hults, an executive coach and
executive director of Job
Shapers, a career-development
group in St. Louis, he’s prepar-
ing to describe those strengths
clearly to others whenever he
asks for advice about next
steps.
You allow your network to
stagnate
Many people dread network-
ing and see it as shameless self-
promotion. But effective net-
working actually builds lasting
relationships that open you up
to giving and receiving new
ideas, opportunities and help.
Solutions to career problems
“typically aren’t found within
your own little cluster” of col-
leagues and friends, Mr. Hults
says.
Brad Fuller, another client of
Mr. Hults’s, worked in creative
jobs in advertising for years,
then discovered he also loved
researching brand strategies for
clients. He didn’t know whether
he was qualified to work for
firms that specialized in strat-
egy, however, and he hadn’t net-
worked widely enough to find
out.
“I was locked in the place
where I was making a lot of
money, and it was very seduc-
tive for me to stay there,” Mr.
Fuller says of his job running a
St. Louis ad agency.
He began dreading Monday
mornings. Only after he left the
agency after five years as managing
director and resumed networking
did he learn that he was qualified
to do the work he loved. He landed
a vice presidency with a firm spe-
cializing in brand strategies.
ILLUSTRATION BY JON KRAUSE

TELEVISION

‘PLANET EARTH’ RETURNS WITH EPIC BATTLES

BY JOHN JURGENSEN
ONE OF THE MOST MEMORABLE
chase scenes you’ll see on screen this
year—vehicular, human or other—un-
folds on a rocky Galapagos beach, as
freshly hatched iguanas try to outsprint
gangs of swift, long snakes.
This sequence from “Planet Earth II,”
starting Feb. 18 on BBC America, went viral
on the web and helped drive record ratings
for the six-part nature series in the U.K.
(where it aired last fall).
Footage of the life-or-death reptile race
came in from the field just in time for exec-
utive producer Mike Gunton to show a
rough cut at an international gathering of
television investors and distributors. When
one iguana escaped a seemingly fatal choke
hold on screen, the audience of “hard-nosed
TV buyers” stood and cheered, Mr. Gunton
recalls. “I wish I had the sequence four
years ago when we were trying to raise the
money [for ‘Planet Earth II’]. We probably
would have had double.”
In the world of nature documentaries,
“Planet Earth” is the rare brand that carries
blockbuster heft. In 2006, the original series
drew hundreds of millions of viewers world-
ard hunting and slow-motion scenes of
great white sharks going airborne to chomp
seals. Timing was a factor in its success: the
grand-scale series, produced by the BBC and
Discovery, served as a showcase for the
high-definition television sets that
were turning living rooms into
home theaters.
The plan to make a sequel
put pressure on producers.
“You’re trying to grow crops in the
shadow of a huge tree,” says Mr. Gun-
ton, creative director of the BBC’s Natural His-
tory Unit. They had the same globe-spanning
mandate to introduce viewers to the most re-
mote places and elusive species, but
producers put a greater em-
phasis on environmental
warnings, and used advances
in technology to change the
perspective for the sequel.
The original “Planet Earth” often
used powerful cameras mounted on helicop-
ters to deliver a bird’s-eye view. For “Planet
Earth II,” the miniaturization of stabilized
cameras—both drone and hand-held—gave
camera operators more close-up intimacy.
That resulted in some action sequences sus-
penseful enough to warrant spoiler alerts,
as when a pack of starving lions tries to
BBC AMERICA (2)

wide with the first footage of a snow leop- Please see EARTH page A13

Scenes of hatchling marine iguanas, left, trying to outrun racer snakes, right, on Galapagos went
viral and helped drive huge TV ratings in the U.K. for “Planet Earth II.”
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
A10 | Wednesday, February 15, 2017 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. Wednesday, February 15, 2017 | A11

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A12 | Wednesday, February 15, 2017 THE WALL STREET JOURNAL.

LIFE & ARTS

MY RIDE

A Classic Chevy Impala for the Modern World

Frank Congemi, 64, a financial adviser
from Deerfield Beach, Fla., and Howard
Beach, N.Y., on the car he calls Mr. Lucki,
as told to A.J. Baime.
Over the years, I have learned that
most men at a certain age come to a real-
ization that they want to buy a car that
they have been dreaming about for years.
Often it is a car that reminds them of
their youth. I am one of those guys, and I
come across this all the time helping peo-
ple figure out their retirements. The car
is often part of the dream.
Mr. Lucki started out as a bonding
project between my son and me. In 1996,
I found a rusty 1963 Chevy Impala SS on
someone’s yard in Brooklyn and bought it
for $1,500. My son and I set out to re-
build the car. Eventually, he got bored and
bought a Honda Civic. But I kept on work-
ing, because I wanted to set an example.
The car became a metaphor for persever-
ance. The name is from the Blake Ed-
wards TV show “Mr. Lucky,” from when I
was a kid.
I put a new Corvette engine in the car,
disc brakes, Sirius radio, a new automatic
transmission and a new, comfortable inte-
rior—everything needed to make this old
Impala a modern American cruiser. I
travel all over the country visiting clients.
Mr. Lucki has been to Maine, Atlanta, St. Frank Congemi, right, with Mr. Lucki, his 1963 Chevrolet Impala SS,
Louis, New Orleans and all over Florida. in Florida. Mr. Congemi estimates that he spent about $6,000 on a
How do you know if your car is really new, custom interior, below.
cool? State troopers pull you over be-
cause they want to look at it. I cannot
count how many times I have been pulled
over. I admit sometimes I am going 90,
but these troopers really just want to see
the car. If I can get the officer to talk
about his retirement plans, he’s not likely
to write a ticket.

JOSH RICHIE FOR THE WALL STREET JOURNAL (3)

In the end, I put about $25,000 into
Mr. Lucki. To me, the car does not have
monetary value, because I will never sell
it. I also bought another fixer upper—a
1969 Dodge Super Bee, which I named Mr.
Jimi (after Jimi Hendrix).
These are the kinds of cars I drove
when I was in high school. So I guess that
means I have never grown up.

Contact A.J. Baime at

Facebook.com/ajbaime.

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  © 2017 Dow Jones & Company, Inc. All Rights Reserved.
 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
THE WALL STREET JOURNAL.
MCA CHICAGO
EXHIBITION REVIEW
THE NATURE OF
DANCE ITSELF
BY EDWARD ROTHSTEIN
Minneapolis and Chicago
A CONFESSION: I am not a
Mercist—which is what Arlene
Croce once called the devotees
of the choreographer Merce Cun-
ningham (1919-2009). But it isn’t
because I decided his work was
of no consequence. I simply ac-
cepted his word for what he was
interested in: showing that
dance could have nothing to do
with the music that accompanied
it or the images that framed it. I
was far more intrigued by the
opposite: the arts resonantly il-
luminating each other. I also
took his word that his lifelong
alliance with John Cage was a
conjoining of similar tempera-
ments, and Cage’s work I found
amusing, but ponderous and ma-
nipulative. So why bother with
Merce?
Yet there I was last week, in
two different cities (Minneapo-
WSJ TALK / E XPERIENCE / OFFER / G ETAWAY
Explore the
Island of
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(and D.C.), age 21 and over. For official rules, including prize description and odds, visit wsjplus.com/officialrules. Sponsor: Dow Jones & Company, 1211 6th Ave., New York NY 10036.
Wednesday, February 15, 2017 | A13
LIFE & ARTS
EARTH
Installation view at MCA with Co-produced by BBC America,
Charles Atlas’s ‘MC9’ (2012). “Planet Earth II” is narrated by the
godfather of British nature films,
were organized by the Walker ar- David Attenborough. (For the orig-
tistic director, Fionn Meade, Continued from page A9 inal series in 2006, Discovery sub-
along with Philip Bither, Joan take down a galloping giraffe, and stituted Sir David’s narration with
Rothfuss, Mary Coyne and (at when a bat does battle with a Sigourney Weaver for the U.S. au-
MCA) Lynne Warren, with most scorpion in the deserts episode. dience.)
selections coming from the In a quieter moment, a camera Extensive pre-shoot research mit-
Walker’s Merce Cunningham mounted above a male bird of par- igates the risk of missing the money
Dance Company collection. The adise offers a potential partner’s shot. For example, Unforgiving
Walker takes you from Cunning- view of his mating dance, reveal- weather and volcanic terrain gave
ham’s early explorations with ing a flash of green plumage that a them one chance to embed with a
John Cage to 2007, when, wheel- scientist on the shoot didn’t know massive colony of chinstrap pen-
chair bound, Cunningham “per- he had. guins on uninhabited Zavodovski Is-
forms” “Cage’s 4’33”” on film for The team that captured that land in the South Atlantic.
Tacita Dean, sitting in perfect jungle ballet, led by producer and As an overseer of the series, Mr.
quietude surrounded by ambient director Emma Napper, also towed Gunton has to manage the psychol-
noise. a camera behind a canoe to find ogy of field teams and corporate
But I was particularly drawn in river dolphins that roam flooded bosses—both obsessed with getting
both shows to “MC9” by the me- forests in Brazil. The species had awe-inspiring footage. “Part of my
dia artist Charles Atlas. In dark- been discovered only a couple of job is to make sure everyone is on
ened galleries, fragments from 40 years before. “We wanted to film the train, saying, ‘Yes, this is going
years of his filming the Merce an animal that people knew noth- to be a success,’ even when I’m se-
Cunningham Dance Company are ing about, so that makes it almost cretly crying in the cupboard.”
distributed among nine video impossible,” Ms. Napper says. For For all its success, the original
screens, some immense and en- about six weeks they caught only “Planet Earth” was criticized in
gulfing. Why was I so drawn? glimpses through opaque water conservation circles for flaunting
Partly because I never saw a live and dense trees until their camera- the spectacle of wildlife without
Cunningham performance. His equipped drones discovered a showing the man-made threats
company dissolved, as intended, group of seven or eight dolphins. facing it. That was “a reason to go
after his death, in 2011. Dancers’ Tech innovations didn’t make back” for a sequel, Mr. Gunton
muscle memory still offers some the shoots any less painstaking. says. In “Planet Earth II,” environ-
testimony: I saw it ecstatically re- Ms. Napper’s team spent four mental problems become one of
alized in Cunningham excerpts at years gathering research and foot- the many challenges that face spe-
MCA by former members of the
company. But films are airless,
the camera an interference. In
“MC9,” though, I begin to get a
age for the 50-minute jungle epi-
sode. To capture a duel between
golden eagles in the Alps, camera
operators spent 100 hours in a
cies. The final episode focuses ex-
clusively on animals that adapt to
city living, including giant catfish
introduced to France that learned
sense of the life of the whole— camouflaged bunker. In total, the to hunt pigeons.
lis and Chicago) at two muse- enough to think that maybe I had series deployed 60 cameramen in —Anna Russell contributed
ums (the Walker Art Center and Cunningham wrong and maybe 40 countries for 2,089 days. to this article.
the Museum of Contemporary Cunningham got himself partly
Art, respectively), at the open- wrong.
ings of two related exhibitions The arts here certainly did jos-
and felt thoroughly involved. tle each other in common time.
Both shows share a title— And Cunningham adopted or pio-
“Merce Cunningham: Common neered the mannerisms that now
Time”—and with it Cunning- make the era’s “experimental”
ham’s view that disparate arts music and film so eminently for-
might share “a common time” gettable. But in Cunningham we
but little else. The combined also see something different: a
42,000 square feet of costumes, discipline of the body. The effect
videos, photographs, sets, re- is concrete and immediate, vital
cordings, scores and artworks and dramatic, a cold formality
document interaction between governing explosions of impulse,
Cunningham and visual artists visceral energy confronting ratio-
like Robert Rauschenberg, Frank nal detachment. And it all unfolds
Stella, Jasper Johns and Andy in uncommon time.
Warhol, who created sets or
costumes for him, and various Mr. Rothstein is the Journal’s
composers like Cage and Morton Critic at Large.
Feldman whose music could be
BBC AMERICA
danced against. Merce Cunningham: Common
The Walker exhibition is the Time
more imposing, almost three Walker Art Center, through July 30
times the size of the MCA’s, Museum of Contemporary Art A crew in Madagascar, including cameraman Rob Drewett, crossed flooded
though both are revealing. They Chicago, through April 30 terrain and boarded a helicopter in pursuit of a super swarm of locusts.
Unspoiled, easygoing and endlessly
beautiful, Lana’i is the Hawaii
captured in vintage postcards.
One lucky WSJ+ member will win a three-
night getaway to the Four Seasons Resort
Lana’i. Take an off-roading excursion to a
remote part of the island, snorkel in Hulopo’e
Bay and adventure by helicopter
for breathtaking views.
E XCLUSIVE TO WSJ MEMBER S
ENTER TO WIN AT WS JPLUS .COM /L ANAI
© 2017 Dow Jones & Co., Inc. All rights reserved. 6DJ5037
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
A14 | Wednesday, February 15, 2017 THE WALL STREET JOURNAL.

SPORTS
HEARD ON CHAMPIONS LEAGUE
THE FIELD
Soccer’s Most Decorated Student
Having cycled through the world’s best managers, Xabi Alonso’s education in the game is unmatched
BY JOSHUA ROBINSON

Munich
Xabi Alonso didn’t need the
notebook when he was 22. That
was before he made his name as a
midfielder at Liverpool, before he
won the Champions League twice
The East Is Upended by and the World Cup once, and long
before he considered life after
Love Injury, Ibaka Trade playing soccer.
The NBA season was sleepwalk- Five or six years ago, however,
ing to the All-Star break on Tuesday it began to dawn on him that his
morning when it was suddenly career was far from ordinary: Over
awakened with a jolt. In less than more than a decade, Alonso had
one hour, the entire Eastern Confer- picked the brains of the greatest
ence was upended. managers on the planet every day.
Since the season began—and re- His soccer education—which ran
ally since the return of LeBron through Rafa Benitez at Liverpool;
James three years ago—the Cleve- Jose Mourinho at Real Madrid;
land Cavaliers have been the heavy and now Pep Guardiola and Carlo
favorite to win the East. And they Ancelotti at Bayern Munich—was
still are. But their shot at the No. 1 the sport’s Harvard, Yale and
seed and home-court advantage Princeton all rolled into one.
took a hit when the team an- Alonso had to get this on paper.
nounced that All-Star forward Kevin Today, while anchoring Bayern
Love’s (above) left knee required ar- Munich’s midfield, he keeps a sin-
throscopic surgery that will keep gle Moleskine full of training plans
him sidelined for at least six weeks. and errant thoughts from his time
It was only the latest twist in in the world’s most successful
what has been a typically chaotic teams. He doesn’t know what he’ll
season for the Cavs. And it only in- do with it yet. But as the 35-year-
creased the burden on James— old Alonso considers sliding from
which was significant to begin with. midfield into management—this
The most fearsome player in the may be his final season—he figures
league is still averaging 37.6 min- the wisdom of Mourinho, Guardiola
utes per game, more than all but et al might come in handy.
one NBA player, which is an inexpli- “I am a midfielder, I’m not a
cably heavy load for a 32-year-old striker. I like control,” he said
star whose team’s championship here, ahead of Bayern’s Champions
defense relies on him being at his League round of 16 game against
best in the playoffs. Arsenal on Wednesday. “So how to Xabi Alonso joined Bayern Munich in 2014,
That one player is Toronto guard deliver that control is what goes after stints with Liverpool and Real Madrid.
Kyle Lowry. But less than an hour through my mind—in different sys-
MATTHIAS SCHRADER/ASSOCIATED PRESS
after the news of Love’s injury, Ya- tems, in different games.”
hoo Sports reported the Raptors If ever there was a player who And that’s precisely what worries Ancelotti ran the midfield for the knows his position and he thinks
had traded for Orlando Magic for- seemed perfectly suited to the dug- Alonso. all-conquering AC Milan side of so fast,” Bayern and Chile mid-
ward Serge Ibaka (below), securing out, it’s Alonso. The only person Despite recent headlines to the the late 1980s; Chelsea’s Antonio fielder Arturo Vidal said.
Lowry and DeMar Derozan the help who isn’t certain about it yet is him, contrary, he hasn’t fully made up Conte was a key cog in the Juven- As far as Alonso is concerned, it’s
they need to knock off Cleveland. even if all the lessons are there. his mind about his future. There tus team of the 1990s; and Real’s the only position he could play. “I
The Raptors, who lost to Cleve- From Guardiola, the man Alonso may be another season in his legs. Zinedine Zidane, who won the have to play mostly in central mid-
land in the conference finals last joined Bayern for in 2014, he And if there isn’t, he said he would Champions League in his first sea- field,” he said. “And I have always
season, needed some kind of learned how to preach a particular need time to come down from his son as Madrid manager, is one of taken that responsibility, not to take
shakeup. They had fallen to fifth brand of soccer, “how to be able to playing career before heading into his generation’s greatest players. the orders, but to deliver the idea of
place in the East and ceded their convince the players that this is management. Of course, playing achievements the manager into the team.”
claim as the team most likely to the right way,” he said. With “I know pretty well the life as a don’t guarantee success. But as Alonso felt a special connection
upset the Cavs to the Boston Celt- Mourinho at Real Madrid, he footballer, how it is. But the life as more managers find it difficult to with Guardiola when he was taking
ics, whose surge into second place watched a manager keep his team a citizen, having to find what to keep a lid on the egos of young, his ideas into battle—he made a
had Dallas Mavericks coach Rick emotionally on the boil without do, it’s going to be a new stage,” super-rich players, pointing to a habit of dropping into Guardiola’s
Carlisle calling them a legitimate erupting—especially when Barce- he said. “You need to be 100% sure full trophy cabinet at home helps office to talk tactics and dissect
T-B: NICK WASS/ASSOCIATED PRESS; MIKE EHRMANN/GETTY IMAGES

threat to get to the Finals. lona was in their sights.
—Ben Cohen Barca “were so great and with
Madrid, we were growing, but we
were still not on that level. We
needed to be really, really... in-
tense. Let’s leave it that way,”
Alonso said.
But fundamentally, Alonso felt
those managers were more similar
than they seemed. For all of their
public persona—Ancelotti the el-
der statesman, Guardiola the effer-
vescent genius, Mourinho the dour
schemer, and Benitez the frenzied
planner—he saw the same obses-
siveness in all of them. These were
men utterly consumed by soccer.
that you want to do it, because it’s
so demanding. It’s so stressful.”
That transition, should Alonso
make it, would be perfectly in
keeping with the trend of the mo-
ment in European soccer manage-
ment. Where it was traditionally
an avenue for former players with
pedestrian careers, the most pres-
tigious management jobs now
practically require a glittering ré-
sumé of on-field achievements.
Just take a look around the
summits of the top leagues. In
England, Spain and Germany the
coaches leading the league all had
stellar playing careers. Bayern’s
command respect. “It’s important
for a manager to come in and have
the credit and respect from the
players,” said Alonso.
Alonso made his career on the
pitch by excelling at one of the
least glamorous jobs this side of
the ball boys. His role consists of
sitting in front of the back line,
protecting his defenders, and link-
ing play to the attacking players.
Timing and vision are everything.
That job is perfectly suited to
Alonso’s two best qualities: his
passing vision and his uncanny
ability to take up space.
“He’s such a calm player, he
opponents. His one regret is that
in their two seasons together, they
never won the Champions League.
Now, with Guardiola’s foundation
in place, Alonso is hoping to finish
the job under Ancelotti and be-
come only the second player ever
to lift the trophy with three differ-
ent clubs. (The other was Dutch
midfielder Clarence Seedorf.)
“To win the Champions League,
some time along the way, you need
one day of luck,” said Alonso, who
experienced miracles to win it
with Liverpool in 2005 and Real in
2014. “So far it hasn’t happened
here in Bayern. We need one.”

Weather The WSJ Daily Crossword | Edited by Mike Shenk

Shown are today’s noon positions of weather systems and precipitation. Temperature bands are highs for the day.
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City Hi Lo W Hi Lo W City Hi Lo W Hi Lo W
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Today Tomorrow Philadelphia 52 30 pc 39 26 pc Havana 85 63 pc 80 61 sh memo opener? Generation”
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Atlanta 57 33 r 57 38 s Portland, Maine 38 25 sn 33 21 sn Jakarta 85 75 t 86 75 t
43 Hitting coach’s 12 Word on a poetically
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Austin 64 34 s 67 42 pc Portland, Ore. 48 44 r 50 35 sh Jerusalem 47 37 sh 42 32 sh 53 “The King and I”
Baltimore 52 30 pc 40 24 pc Sacramento 66 53 c 63 48 r Johannesburg 80 58 pc 84 59 s logo, for short flow board
46 Piece advocate’s setting
Boise 51 40 pc 48 32 c St. Louis 46 31 s 61 43 s London 52 40 sh 53 38 c 9 Blow ___
Boston 41 29 sn 38 24 pc Salt Lake City 49 30 s 55 34 pc Madrid 59 36 pc 58 34 pc
26 Gum setting org. 13 Brings in
(get mad) 54 Skeletal prefix
Burlington 36 25 sn 30 21 sf San Francisco 64 56 c 63 51 r Manila 84 72 s 86 73 pc 27 Optometrist’s 47 File 18 Timeline division
Charlotte 57 30 r 55 32 s Santa Fe 52 24 s 56 27 s Melbourne 85 62 pc 78 57 pc 14 Definitely not memo opener? 56 Peeper, in Paris
Chicago 35 23 pc 39 30 c Seattle 55 47 r 52 41 sh Mexico City 73 48 pc 70 46 pc paleo- 50 Get by 22 Stud declaration
Cleveland 34 23 sf 30 24 c Sioux Falls 45 28 s 54 33 s Milan 58 35 pc 58 38 s 30 Too big for one’s 59 Templeton in
Dallas 62 37 s 66 46 s Wash., D.C. 51 31 pc 43 28 s Moscow 28 15 c 26 19 pc 15 Bar mitzvah 52 Photographer’s 24 Nice place “Charlotte’s
britches?
Denver 65 36 s 70 33 s Mumbai 95 76 pc 95 76 pc reading memo opener? 26 Diner cupful Web,” e.g.
Detroit
Honolulu
35 21 sf 34 23 pc
83 70 r 82 68 pc
International Paris
Rio de Janeiro
59
93
44 pc
77 s
55 40 c
93 78 s 16 Jai alai player’s
32 Lamenting sigh
55 To a greater
Today Tomorrow 33 Tallahassee sch. extent Previous Puzzle’s Solution
Houston 65 41 pc 67 47 s Riyadh 70 61 sh 73 53 sh need F A D A G A P E R I P E
Indianapolis 39 23 pc 43 31 pc City Hi Lo W Hi Lo W Rome 59 38 s 59 41 s
17 Tennis 36 Alternatively 57 Verdon and C A N E T O T A L I D O S
Kansas City 50 32 s 65 43 s Amsterdam 52 41 pc 48 40 c San Juan 86 71 s 88 72 s L I O N M E T R O P O L I S
Las Vegas 69 49 s 73 54 s Athens 57 43 s 52 38 pc Seoul 46 28 s 52 31 pc pro’s memo 37 Economics Stefani A L I A S S N A P E E R A
Little Rock 56 32 pc 62 36 s Baghdad 66 42 pc 60 38 pc Shanghai 60 47 s 67 52 pc Nobelist R U N L E S S D E S T R O Y
opener? 58 Odist’s memo A R T I C H O K E T E S T S
Los Angeles 78 57 s 71 56 pc Bangkok 89 70 s 91 71 s Singapore 85 77 sh 84 76 c Robert opener? S E E A L A P E N
Miami 86 67 s 80 57 c Beijing 55 35 pc 46 24 c Sydney 81 69 s 87 74 s 19 Defibrillating D E C K O F C A R D S
Milwaukee 34 23 pc 34 31 c Berlin 46 30 s 48 37 pc Taipei 75 60 s 75 60 s shout 38 Humerus 60 Card con also R A Y K A Y H O M
Minneapolis 35 27 c 46 33 c Brussels 57 43 pc 52 40 c Tokyo 53 38 s 56 45 s connection A P R O N V A L E N T I N E
Nashville 49 28 pc 56 36 s Buenos Aires 84 68 pc 87 70 t Toronto 33 16 sn 25 14 pc 20 Bright called “Find the T H E S AM E L E A R N E R
aquarium fish 40 LAX listing Lady” T R E D A N C E G A B L E
New Orleans 62 44 c 62 45 pc Dubai 82 72 c 82 71 c Vancouver 51 44 r 50 36 sh H A V E A H E A R T C O O L
New York City 46 30 c 37 27 pc Dublin 52 40 sh 51 40 c Warsaw 37 26 c 41 32 pc A S E T R E T I E E N V Y
Solve this puzzle online and discuss it at WSJ.com/Puzzles.
s

Oklahoma City 56 31 s 67 39 s Edinburgh 51 44 c 50 40 sh Zurich 51 31 pc 50 35 pc T E S S E R O D E D E E

 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
THE WALL STREET JOURNAL. * * NY Wednesday, February 15, 2017 | A14A

GREATER NEW YORK

Cuomo Opts
To Put Hold
MARK KAUZLARICH FOR THE WALL STREET JOURNAL; LOUIS LANZANO/POOL (BELOW)

On Bag Fee
BY MIKE VILENSKY
AND MARA GAY
Gov. Andrew Cuomo said
Tuesday he would sign a bill
that halts a 5-cent fee on
plastic bags in New York City.
The measure places a one-
year moratorium on a law
passed by the City Council
last year; the law would have
gone into effect Wednesday.
The governor’s decision is
a loss to liberal environmen-
talists and a victory for con-
servatives who argued the
Stan Patz left a Manhattan courthouse Tuesday after a jury convicted Pedro Hernandez, below, of killing his son, Etan, in 1979. law was a regressive tax on
the working class.
wrote. “Most objectionable is
that the law was drafted so
that merchants keep the five-
cent fee as profit, instead of
the money being used to
solve the problem of plastic
bags’ environmental impact.”
Mr. Cuomo said he would
establish a state task force to
study the issue.
At City Hall, the news was
met with deep disappoint-
ment. Mayor Bill de Blasio, a
Democrat, didn’t comment.
Council members Brad
Lander and Margaret Chin,
two sponsors of the law, said
in a joint statement that they

Guilty Verdict in Patz Murder Trial

Supporters of the law also
questioned if it was appropri-
ate for Albany to overrule the

BY THOMAS MACMILLAN

Nearly 38 years after Etan

Patz disappeared, a Manhattan
Supreme Court jury determined
Tuesday that the 6-year-old was
kidnapped and murdered by a
stock clerk in a SoHo bodega.
A jury of eight men and four
women reached that conclusion
on the ninth day of delibera-
tion in the trial of Pedro Her-
nandez, 56 years old, of Maple
Shade, N.J., who was charged
with killing the first-grader.
“The Patz family has waited
a long time but we finally have
found some measure of justice
for our wonderful little boy,”
said Stan Patz, the child’s father.
The jury presented a split
verdict on two counts of mur-
der and one count of kidnap-
ping. The jurors found Mr.
Hernandez not guilty on the
first count of intentional mur-
der but guilty on the second
count of felony murder and on
the kidnapping charge.
Mr. Hernandez faces the
possibility of life in prison.
Justice Maxwell Wiley set a
sentencing date for Feb. 28.
A previous trial ended in a
mistrial in 2015 when jurors
failed to agree on a verdict.
“Deliberations were diffi-
cult,” said Tommy Hoscheid,
the jury foreman.
Defense attorney Harvey
Fishbein said he would appeal
the verdict. “We are obviously
terribly disappointed” with the
verdict, Mr. Fishbein told re-
porters. Assistant District At-
torney Joel Seidemann, who
tried the case with Joan Illuzzi,
said, “After 37 years, there is fi-
nally some measure of justice.”
The verdict ends a mystery
that has haunted New Yorkers
since Etan disappeared on
May 25, 1979, while walking to
his SoHo school bus stop alone
for the first time.
The disappearance touched
off a massive investigation, and
became a catalyst for the cre-
ation of a national missing-chil-
dren movement. Etan was one
of the first children to appear
on the side of a milk carton.
The prosecution’s case
against Mr. Hernandez relied
largely on a statements he
made to police detectives who
questioned him in 2012, fol-
lowing a tip from the defen-
dant’s brother in law.
Mr. Hernandez confessed to
police that he had lured Etan
into the basement of the SoHo
bodega where he worked. He
had promised to give the child
a soda, he said, but fatally
choked him and disposed of his
body. Etan was never found.
Mr. Hernandez’s defense at-
torneys argued that the con-
fession was a fabrication, the
result of hours of untaped in-
terrogation by police.
In the trial, defense wit-
nesses testified that Mr. Her-
nandez, who is twice married
with three children, has an ab-
normally low IQ and suffers
from a mental illness that pre-
vents him from distinguishing
fact and fantasy.
council.
Council officials said they
are considering legal options.
Mr. Cuomo, a Democrat,
was faced with a lose-lose
choice, analysts said. By veto-
ing the measure, the gover-
nor might buoy support
among national environmen-
tal activists but risk a legisla-
tive override.
By signing the bill, he may
smooth relations with legisla-
tors he has been at odds with
of late but alienate council al-
lies and environmentalists
whose support he may want
in the future.
Mr. Cuomo announced his
decision at the buzzer, late
Tuesday afternoon, in an un-
usually lengthy statement.
“[W]hile New York City’s
law is an earnest attempt at a
real solution, it is also unde-
niable that the City’s bill is
deeply flawed,” Mr. Cuomo
5 cents
The city’s surcharge on plastic
bags that the governor will halt
had accepted defeat. The
Democrats began work on the
issue in the final years of
Bloomberg administration.
“We fought plastic bags,
and for now, plastic bags
won,” they said.
Earlier in the week, Mr.
Lander said he had accepted
the fate of the law but was
still surprised it had met
such fierce opposition in Al-
bany.
“It’s an upside-down world
and we tried to do a right-
side-up thing,” he said. “I
care about this issue enough
to have worked on it but it is
not the cause of my lifetime.”

Oberlin President Named

To Lead Pace University
BY LESLIE BRODY for students inspires me,” Mr.

The president of Oberlin

College has been tapped to be
Krislov said.
Pace University declined to
release Mr. Krislov’s compen-
WATERMARKPOINTE
B R E AT H TA K I N G W AT E R V I E W S • B E A C H F R O N T L I V I N G
president of Pace University as sation. However, the most re-
the New York City school pre- cent 990 tax forms that show
pares a major expansion. executive pay at nonprofits
Marvin Krislov, who has listed Mr. Friedman’s 2014
led the Ohio college since compensation as $691,800, in
2007, will succeed Stephen addition to $44,684 from re-
Friedman, 78 years old, who lated organizations. That sum
has been in the post for a de- was more than Mr. Krislov
cade, and said last year that earned that year at Oberlin,
he would step down. The where tax forms said he made
leadership change is expected $437,246 plus $140,317 from
BILLY DELFS

to take place in August. related organizations.

Pace’s board of trustees an-
nounced the appointment
Tuesday, noting Mr. Krislov’s
efforts to make Oberlin more
diverse and enroll more highly
qualified, low-income students.
During his tenure, Oberlin
raised $318 million in dona-
tions, attracted more science
grants and built a new jazz
studies building and a stadium.
Mr. Krislov, 56 years old,
will steer Pace at a time when
it has ambitious expansion
Oberlin President Marvin Krislov
plans. Last week, the univer-
sity announced a $190 million
plan to renovate and expand
its lower Manhattan campus.
The century-old private insti-
tution has about 13,000 stu-
dents in undergraduate and
graduate programs.
“Pace’s commitment to ac-
cess and pathways to success
Before leading Oberlin, Mr.
Krislov, a Rhodes Scholar, was
vice president and general
counsel at the University of
Michigan. While there, he led
the university’s successful de-
fense of its admissions policies
in a legal case that went up to
the U.S. Supreme Court.
In a 2003 ruling, the court
upheld the right of universities
to consider race in admissions
procedures to achieve a diverse
student body.
View from WatermarkPointe

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offeringoftheadvertisedunitscanbemadeandnodepositscanbeaccepted,orreservations,binding
or non-binding, can be made until an offering plan is filed with the New York State Department
of Law. This advertisement is made pursuant to Cooperative Policy Statement No.
1, issued by the New York State Department of Law. CP16-0104. Sponsor: Zinrock
Resources L.P. 3 Manhattanville Road, Suite 202, Purchase, New York 10577.
BACK ON THE FIELD: Pitcher Jacob deGrom, manager Terry Collins and other Mets in Port St. Lucie, Fla.
The team was one of over a dozen that held their first scheduled spring-training workouts Tuesday.
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
A14B | Wednesday, February 15, 2017
Catch, a West Highland Terrier, gets a reward for enduring a beauty regimen. Walter and Dodi Horowitz with Flyer, their Golden Retriever. And a smiling Taylor Forbes with Quitara, a Spinone Italiano.
Leading a Dog’s Life Isn’t Always So Bad
BY MELANIE GRAYCE WEST
It isn’t easy being top dog.
Being combed and blow-
dried. Getting treats—and
kisses. Posing for a selfie with
a woman wearing heart-shaped
glasses. Oh well, it was Valen-
tine’s Day, after all.
Tuesday was also the last
day of the 141st annual West-
minster Kennel Club Dog Show,
which culminated at Madison
Square Garden with the Best in
Show award, won by a German
shepherd named Rumor.
The canine made last year’s
best-in-show finals at West-
minster, losing to a German
shorthaired pointer. The last
win by a German shepherd or
by a dog from the herding
group came in 1987.
Some 2,500 pooches took
part in the competition, which
kicked off Saturday. Each had
its own digital profile for media
use, according to the club web-
site.
Besides Rumor, others vying
for Best in Show included a
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Norwegian elkhound, a Peking-
ese and a miniature poodle.
A Pekingese has won the top
title four times, most recently
in 2012.
Miniature poodles have won
best in show three times, in-
cluding in 2002.
Three new breeds joined the
competition this year. The
American hairless terrier was
bred from the rat terrier and
dates from the 1970s. The
Pumi, a breed native to Hun-
gary, is bred to herd cattle,
sheep and pigs. The Sloughi, a
dog from North Africa, is now
part of the hound group.
This year’s competition in-
cluded 200 breeds. The show
also included agility and obedi-
ence contests.
The Westminster Kennel
Club, established in 1877, is a
nonprofit group. For the fiscal
year ending April 2015, the
club’s revenue topped $3.8 mil-
lion, drawn from show spon-
sorship, television rights, ticket
sales and other fees related to
the show.
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GREATER NEW YORK
TOP DOG: Rumor, a German shepherd, won Best in Show at the Westminster Kennel Club Dog Show at Madison Square Garden Tuesday.
BANKRUPTCY
Big Apple Circus Sale Ex-Coach Is Charged
Is Cleared by Judge With Embezzlement
A U.S. bankruptcy judge has
approved the a $1.3 million sale of
the Big Apple Circus to Compass
Partners LLC, an investment firm
that intends to revive the circus
by bringing holiday shows back to
Lincoln Center this year.
At a hearing Tuesday in Man-
hattan, Judge Sean Lane said he
was pleased to see Big Apple Cir-
cus find a new owner after seek-
ing chapter 11 protection in No-
vember.
Sarasota, Fla.-based Compass
hopes to reach a long-term agree-
ment with Lincoln Center and
plans to establish new adminis-
trative offices for the circus in the
city.
—Jonathan Randles
CORRECTIONS 
AMPLIFICATIONS
Scott Strauss, the mayor of
Mineola, N.Y., hasn’t decided
whether to support or oppose
a $2 billion plan to ease bot-
tlenecks on the Long Island
Rail Road. An article Tuesday
said Mr. Strauss opposes the
project.
Readers can alert The Wall Street
Journal to any errors in news articles
by emailing wsjcontact@wsj.com or
by calling 888-410-2667.
$3995DownPayment
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GREATER NEW YORK WATCH
BARUCH COLLEGE
A former Baruch College
sports official is accused of em-
bezzling about $600,000 in
school funds by renting out
gyms for his own benefit.
Machli Joseph, of Elizabeth,
N.J., was charged Tuesday with
one count of misapplication con-
cerning a program receiving fed-
eral funds. He faces up to 10
years in prison, prosecutors said
The 42-year-old Mr. Joseph,
who was associate athletic di-
rector, routed payments that
should have gone to Baruch Col-
lege to his own bank accounts,
according to a federal complaint.
Mr. Joseph worked at the col-
lege from 2002 to September,
when he resigned.
An attorney for Mr. Joseph
said his client was looking for-
ward to addressing the accusa-
tions.
Baruch President Mitchel
Wallerstein said he would take
further steps to improve over-
sight.
—Corinne Ramey
CLIMATE CHANGE
New York State Sets
Sea-Level Projection
New York state has adopted
official projections indicating sea
levels along the state’s coastline
could rise by as much as 6 feet
by the end of the century.
Sales Monday to Friday: 9am - 9pm • Saturday: 9am - 5pm • Sunday: 11am-4pm
* ***** THE WALL STREET JOURNAL.
CLOCKWISE: ANDREW LAMBERSON FOR THE WALL STREET JOURNAL (3); MIKE SEGAR/REUTERS
MICHAEL MELIA/ASSOCIATED PRESS
LOFTY GOAL: New Haven, Conn., has halted work on a mosque
because two minarets are 24 feet too tall. The building’s owner
must figure out how to make the 81-foot-tall towers smaller.
The figures are based on sci- dren as young as 14 years old to
entific research and will be used wed can trap minors in sexual
to help the state and its com- abuse and domestic violence be-
munities prepare for climate
change.
cause they have limited access
to legal services and shelters.
New York is working to help
local governments, businesses
On Tuesday, Democratic As-
semblywoman Amy Paulin intro-
and others prepare to protect duced a bill to raise the mini-
people and property, said Basil mum age for marriage to 17.
Seggos, the state’s environmen- New York is one of three
tal conservation commissioner. states that allow 14-year-olds to
—Associated Press marry with parental and judicial
consent. Twenty-seven states
have no minimum age in state
CHILD MARRIAGE statute.
Ms. Paulin says 3,850 minors
Measure Would Raise were married in New York state
Minimum Age to Wed between 2000 and 2010. Eighty-
four percent were minor girls
Child advocates say a New married to adult men.
York state law that allows chil- —Associated Press
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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
THE WALL STREET JOURNAL. Wednesday, February 15, 2017 | A15

OPINION
Dieselgate Is a Political Disaster BOOKSHELF | By Laura Vanderkam

Contrary to
usual prac-
tice, we’ll be-
We have here an emblem of
the Western world’s infirmity.
Multiple irrationality loops
Living
gin with the
punch-line:
less than
4/1,000ths of
have taken over. Climate policy
is the primary example—a
pure traffic in costly gestures
that create no real benefits for
For Likes
BUSINESS
WORLD a degree Cel-
sius. That’s
the public. In the U.S., the to-
tality of Obama climate poli-
The Happiness Effect
By Holman W.
By Donna Freitas

CORBIS VIA GETTY IMAGES

how much cies—his fuel mileage targets,
Jenkins, Jr.
warming his coal regulations, his wind (Oxford, 339 pages, $29.95)

might be
spared half a century from
now thanks to Europe’s deci-
sion, starting after the Kyoto
treaty in the late 1990s, to
switch more than 50% of its
passenger cars to diesel.
For this negligible result,
Europe got significantly dirtier
air. Paris, on some days, suf-
fers worse smog than Beijing.
Though his methodology may
Typical of Western
leadership was a
policy of huge cost
and zero benefit.
be questionable, a U.K. govern-
ment scientist estimates that
thousands of citizens die each
year because of increased ni-
trogen oxide and soot emis-
sions.
The word “microcosm” was
invented for Europe’s diesel
snafu—a microcosm of the
governance failures that are
breeding political revolt in
much of the advanced indus-
trial world. Europe has gone
overnight from pushing and
subsidizing citizens to adopt
diesel vehicles, to punishing
them with taxes and excluding
them from downtown areas.
Britain is contemplating a
scheme to pay owners to scrap
their diesel cars.
Europe’s entire auto indus-
try was led down the primrose
A gas station in Frankfurt, December 2014.
lane of adopting a technology
that now appears to be a com-
mercial and regulatory dead-
end. More than 70% of BMW
and Daimler cars made for the
European market last year
were diesel. When honestly
tested, one study shows the
latest “Euro 6 Standard” vehi-
cles miss their pollution tar-
gets by a whopping 400%.
Virtually everyone agrees
Europe’s “dash for diesel” was
a monstrous policy error, not
to mention the proximate cause
of the emissions-cheating scan-
dal that has engulfed Volks-
wagen and other auto makers.
Yet the overarching imperative
today is to vilify the car com-
panies and insist they do better
at achieving meaningless re-
ductions in CO2 emissions, now
by forcing them to build elec-
tric cars that customers must
be bribed and pressured into
buying. Not to be questioned,
though, is the green agenda or
the competence of Europe’s po-
litical class.
When a government conceit
goes pop in such a disastrous
way, we usually get reform.
That won’t be the case here.
But at least, in this mael-
strom, Volkswagen’s outside
shareholders and German cor-
porate-governance reformers
saw a chance to solve one real
problem—the excessive influ-
ence of government and labor
appointees on Volkswagen’s
supervisory board, where they
work together to inflate em-
ployment. It takes VW twice as
many workers to build a car as
it does Toyota.
And VW reformers looked
set to prevail at this past sum-
mer’s annual meeting until, at
the last minute, the company’s
ruling families, the Porsches
and the Piëchs, caved to a
jigged-up rescue of the status
quo.
In place of depoliticizing
the company and improving
efficiency, Volkswagen ad-
opted a set of faddish prom-
ises to invest in electric cars,
ride-sharing and the new
“mobility economy.” All this
was cover for the real
agenda—a big pay hike and
fresh promises of job security
for unionized workers despite
the $25 billion (and growing)
cost of the diesel cheating
scandal.
As a lengthy Reuters report
frankly summarized, Volks-
wagen’s new “strategy” is
chiefly a political kludge de-
signed to create a simulacrum
of change so real change
doesn’t have to happen.
and solar subsidies—would not
make a detectable difference in
the earth’s climate even if
given a century to work their
nonmagic. Yet the cost will be
hundreds of billions.
The alleged chaos in Amer-
ica that Donald Trump has
wrought, we should remember,
was deliberately sought by
millions of American voters.
Maybe this is why.
In the business world, it’s
widely understood that the es-
sence of “job satisfaction,” even
more than pay or benefits, is a
belief that the people at the top
are making good decisions.
Think of Trumpism not as a
bundle of policy solutions but a
scream of frustration from an
electorate that knows America
hasn’t been making good deci-
sions lately. Next up are Ger-
man, French and Dutch elec-
tions this year where similar
dissatisfactions are roiling.
Congrats to those who can
discern at this early moment
whether the populist upsurge
is a symptom of our further
unraveling or the start of a
turnaround. Much may depend
on our reviled elites. The
Trump cabinet is full of them.
So is the Democratic opposi-
tion that is taking an increas-
ingly unreasoning and rejec-
tionist stance toward
Trumpism. As a class, these
experienced operators un-
avoidably will be needed to
lend a hand to correct the fail-
ures that their own class has
so much contributed to.
S
ocial media sites can be addictive. Almost as addictive:
complaining about what social media does to young
people. In the popular telling, anyone under 25 is a nar-
cissist, convinced that every meal must be photographed and
shared. Students bully one another online and send naked
photos with alarming regularity. Such behaviors may be
worth worrying about, but the real threat is more insidious,
alleges Donna Freitas in her thought-provoking book “The
Happiness Effect.”
The real downside of Facebook, Instagram and their ilk,
Ms. Freitas argues, is constant cheeriness. Young people learn
that any hint of unhappiness or failure may not be posted; it
can haunt their futures and damage their “brands.” This im-
perative then creates a vicious circle. “Because young people
feel so pressured to post happy things on social media, most
of what everyone sees on social media from their peers are
happy things; as a result, they often feel inferior because they
aren’t actually happy all the time,” Ms. Freitas writes. Young
people feel that they have to be online almost all the time,
but they cannot share their real selves there, a situation that
produces even greater unhappiness. “For better or worse,
students are becoming masters of appearing happy, at signifi-
cant cost,” she says. The “happiness effect” isn’t as lurid a
woe as teens sending racy
pictures, but it is an impor-
tant phenomenon to under-
stand and one that parents,
teachers and college adminis-
trators need to address.
To study this happiness ef-
fect, Ms. Freitas, interviewed
nearly 200 college students and
conducted an online survey of
hundreds more. She found that
young people had a nuanced rela-
tionship with social media. They
cannot live without their phones,
but they dislike many aspects of their
online worlds. Facebook in particular long ago acquired a
reputation for being a “highlight reel.” People naturally post
updates from significant events: vacations, parties, gradua-
tions. In theory, young digital natives enamored with them-
selves might post any concern, worry or bad grade that flit-
ted through their lives too.
But Ms. Freitas, a social-science researcher who has taught
at several colleges, learns that adults have been remarkably

Donald Trump’s Medicaid Promise
In the midst program’s costs in poorer
of the tumult states. They proposed, in-
that now stead, giving states a choice
grips Wash- between a per capita allot-
ington, it is ment or a block grant.
easy to forget Led by Rep. Tom Price—
POLITICS that President who now heads the Depart-
Trump has ment of Health and Human
& IDEAS
yet to send Services—Republicans on the
By William
Congress ei- House Budget Committee pro-
A. Galston
ther a budget vided specifics. They would
or a single repeal all of ObamaCare, in-
piece of legislation. When he cluding the Medicaid expan-
does, some longstanding ten- sion. In place of Medicaid,
sions within the Republican they proposed “State Flexibil-
coalition are likely to occupy ity Funds” that would nullify
center stage. “intrusive federal dictates.”
Take Medicaid, a core ele- Relative to the current budget
ment of both the Affordable baseline, the House budget
Care Act and GOP efforts to would reduce Medicaid spend-
rein in federal spending. Ac- ing by roughly $1 trillion—
cording to the Department of around 20%—over the next
Health and Human Services, of decade. Because the cuts build
the roughly 20 million people over time, the reduction in
who have gained health-care 2026 would be even greater,
coverage since the enactment about 25%.
of ObamaCare, more than half It is hard to find anyone
have done so through the ex- who believes that states could
pansion in the Medicaid pro- manage funding cuts of this
gram rather than the individual magnitude without reducing
insurance market. the numbers of beneficiaries,
Last year, congressional Re- the scope of benefits, or both.
publicans made clear what This would make many people
they would do with the pro- unhappy, including—appar-
gram if they had a cooperative ently—the president.
president. Led by Speaker During a 2015 interview
Paul Ryan, the House Republi- with the Heritage Foundation’s
cans’ “Better Way” declared Daily Signal, the soon-to-de-
that “the status quo of today’s clare candidate offered some
Medicaid program is unsus- blunt and bracing remarks on
tainable.” They objected to its the topic of entitlements. “I’m
open-ended character, and not going to cut Social Secu-
they criticized the current rity like every other Republi-
funding formula, which re- can and I’m not going to cut
quires the federal government Medicare or Medicaid,” he de-
to pay a larger share of the clared. Although White House
counselor Kellyanne Conway 28% for the 17 states that
said shortly after Mr. opted out.
Trump’s inauguration that his The people who have gotten
health plan would include medical coverage under Medic-
Medicaid block grants, he has aid, many of whom never be-
not said so publicly. The fore had access to health care,
president’s recent statement include large numbers of work-
that a full plan could be de- ing-class Trump supporters.
layed until the end of the Many of them do not know
year suggests that the matter that the Obama-era Medicaid
remains unsettled. expansion is what made this
possible. They will certainly
find out if the plug is pulled.
If he had run on a Elected officials from these
states already know. West Vir-
platform of slashing ginia’s Republican senator,
entitlements, he Shelley Moore Capito, recently
remarked that “there’s talk of
wouldn’t be president. just totally excluding . . . Med-
icaid expansion [from the Re-
publican replacement for
Mr. Trump has good reason ObamaCare]. That’s 184,000
to proceed cautiously. Of the people in my state.” She
30 states he carried last No- added, laconically, “That’s
vember, 13 have accepted the problematic.” It sure is.
ObamaCare option of expand- Mr. Trump is not Paul Ryan.
ing their Medicaid programs. He did not campaign on a plat-
Of these 13 states, nine have form of balancing the budget
Republican governors, and 12 by slashing entitlements. If he
have legislatures controlled had, he would not be president
by Republicans. And all of today. The people he mobi-
them have benefited from lized into the electorate bene-
participating. fit disproportionately from the
Over the past four years, programs conservatives regard
the three states with the as the principal obstacles to
largest reductions in their their vision of limited govern-
uninsured populations have ment. They know it, and so
been Kentucky, Arkansas and does Mr. Trump.
West Virginia, each of which Ultimately, the success of
expanded Medicaid. They the Trump administration’s
gave Mr. Trump margins of legislative program depends
victory between 27 and 42 on the president’s ability to
points. The 13 Trump states bend conservatives to his will,
that chose to participate re- and so does the political via-
duced their uninsured rates bility of the expanded coali-
by 50%, compared with only tion he created.
successful in convincing young people that social-media posts
can follow them forever. College admissions officers and fu-
ture employers can look back in time and see posts complain-
ing about a difficult boss or admitting loneliness. “People
cannot get jobs or not get interviews because of what they
put on social media,” one student laments. Yet avoiding so-
cial media is almost impossible; professors, for instance, cre-
ate discussion groups on Facebook. So the beast must be
mollified and a “personal brand” maintained: that of a studi-
ous yet social person who does the right activities and holds
the right opinions. “Many students have begun to see what
they post (on Facebook, especially) as a chore—a homework
assignment to build a happy facade,” Ms. Freitas reports.
Only 19% of college students agreed that ‘I am
open about my emotions on social media.’
A full 73% said they always try to appear happy.
Needless to say, this duty to appear happy for the audi-
ence—and, yes, many students speak of friends and family
that way—can grate on the performers. It is a special torture
for young people who are clinically depressed, and it has led,
Ms. Freitas alleges, to the rise of sites such as Yik Yak, where
people let it all hang out, sometimes in vile ways, under the
cloak of anonymity. Parents and colleges are quick to teach
young people how to appear professional online, Ms. Freitas
notes, but they have done much less to help students cope
with the emotional effects of being surrounded by every-
one’s carefully curated perfection.
Ms. Freitas’s detailed survey adds substance to her com-
pelling thesis. Her interviews with 184 randomly selected, di-
verse students from 13 colleges—public and private, selective
and less so—covered faith, parents, selfies, sexting and indi-
vidual social-media histories. Her online questions for 884
more students tested ideas that were developed from these
conversations. A full 73% of her survey respondents agree
that “I try always to appear positive/happy with anything at-
tached to my real name.” Only 19% of respondents agreed
that “I am open about my emotions on social media.”
Some of her interviews contain real gems. One woman re-
ported being so attached to her phone that, mugged for it
on a bus, she pursued the muggers and to get it back gave
them $150 (that, apparently, they hadn’t asked for previ-
ously). People alter privacy settings to share different iden-
tities with different people; a young Muslim woman reports
that she has different Facebook group settings for female
and male friends so that she can post selfies of her uncov-
ered hair (which the men should not see). One young man

A Gamble Helped Black Students Thrive tells her that he doesn’t think his generation is any more
self-centered or self-obsessed than any other. “It’s just that
his generation,” Ms. Freitas writes, “happens to have the
By William Mattox Bethune reached out to James During her performance last sung today. But I see in Mrs. tools ‘to show everybody’ how self-centered and self-ob-
N. Gamble, son of the Procter week, Ersula Odom re-enacted DeVos echoes of James N. sessed they are. ‘Everybody wants to be noticed,’ he says.

S
Tallahassee, Fla.
omething curious hap-
pened at a Black History
Month program held at
Florida A&M University last
week. An actress portraying
African-American educator
Mary McLeod Bethune
(1875-1955) praised someone
with a demographic profile ee-
rily similar to Betsy DeVos,
who earlier that day was con-
firmed by the Senate as educa-
tion secretary. As the program
unfolded, it became easy to see
why the performer decided to
speak up.
When Bethune started her
Daytona School for Negro Girls
in 1904, the education estab-
lishment had little interest in
seeing young black children
receive good instruction. So
she looked elsewhere for help.
& Gamble co-founder and a
regular vacationer in Daytona.
Bethune told Gamble she
wanted more than money. She
needed someone who would
share her vision for giving un-
derprivileged black children
more opportunities.
Gamble was so impressed
with Bethune and her students
that he bought into her vi-
sion—wholeheartedly. He not
only became the chairman of
Bethune’s school, but enlisted
the support of other wealthy
businessmen, including John
D. Rockefeller.
The influx of financial re-
sources helped. Bethune had
previously made school desks
out of discarded boxes and
crates, and ink for pens out of
elderberry juice. But outside
funding didn’t solve everything.
the story of how Bethune and Gamble—another Midwestern ‘Everybody likes feeling approval. They all like it when
her students huddled one Protestant Republican with a other people like them.’ ” Anyone who has posted a photo
night in their schoolhouse as family fortune from a clean- on Instagram and then checked 10 times over the next two
an angry mob of Ku Klux Klan ing-products company. Like hours to count the number of “likes”—and possibly even
members assembled outside. Gamble, Mrs. DeVos has given called her sister to remind her to “like” the post and get the
Suddenly, the voice of one generously to help disadvan- numbers up—knows this feeling.
schoolgirl pierced the dark- taged kids receive a good edu- In her zeal to be thorough, Ms. Freitas sometimes falls
ness, singing the comforting cation, and she has fully into repetition, and she spends relatively little time on what
hymn “God Will Take Care of bought into a philosophy that exactly can be done to help young people navigate this
You.” When Bethune and the places the needs of children world. Her most intriguing suggestion—that schools and em-
other students joined in the re- ahead of the interests of the ployers declare it unethical to consult applicants’ social-me-
sounding chorus, the Klans- education establishment. dia accounts—would be a game-changer. It would also proba-
men realized that they were up That’s something that bly be unworkable. Hiring people is enough of a risk that
against forces they dare not should give pause to all of the those doing the hiring want any information they can get. So
cross. Sheepishly, they turned new education secretary’s de- instead she retreats to the common admonition that we all
and walked away. tractors—especially those who need unplug for a while so less energy is wasted “conform-
I realize some people think last Friday stood in a school- ing to others’ desires” in search of “likes” and more efforts
Mrs. DeVos should be disqual- house door to block Mrs. De- can be made on “self-discovery and discovery of the world.”
ified from public service be- Vos from entering. That’s a nice thought, but considering that only a handful of
cause she supports giving stu- Ms. Freitas’s respondents say they aren’t on social media, it’s
dents more opportunities, Mr. Mattox is director of the an idea unlikely to go viral.
including the option of at- Marshall Center for Educa-
tending faith-based schools tional Options at the James Ms. Vanderkam’s most recent book is “I Know How She
where such hymns are often Madison Institute. Does It: How Successful Women Make the Most of Their Time.”
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 | Wednesday, February 15, 2017 THE WALL STREET JOURNAL.

OPINION
REVIEW & OUTLOOK LETTERS TO THE EDITOR

The Michael Flynn Fallout Both Parties Have Many With Trump Trauma

M
ichael Flynn’s resignation as national be leaked to the press. The conversations of Joseph Epstein’s “At the Trump coined the term “Trumpenfreude,”
security adviser is an opportunity for American citizens are supposed to be pro- Trauma Center, Nobody Comes for meaning the glee or satisfaction ex-
Treatment” (op-ed, Feb. 8) seems to perienced by Democrats watching
Donald Trump to stabilize his White tected, lest private reputations be ruined
suggest that Trump Trauma is a psy- the Republican Party slit its own
House operation. But it’s also without accountability. So chosomatic illness that affects pro- throat. Mr. Krugman was anticipat-
an opening for Congress to Congress should include it’s unsettling to read that so gressives. He neglects to consider ing that Mr. Trump’s candidacy
clarify the troubling intelli- the leaked transcripts many in the government the moderates and even conserva- would bring down the Republican
gence machinations over Mr. claim to have read the tran- tives who are experiencing real Party in ruins. Of course, just the op-
Flynn’s 2016 campaign con- in its Russia probes. scripts of Mr. Flynn’s conver- symptoms caused by Mr. Trump’s posite happened, and now Trumpen-
tacts with Russia. sations with the Russian am- first two weeks in office: an ill- freude might be a good term for
Mr. Flynn became a politi- bassador, and then spoke thought-out travel ban that feeds the those who take pleasure in the pain
cal liability after his account of Dec. 29 phone about them to the press. narrative of radical extremists that endured by victims of Trump
calls with the Russian ambassador was contra- If these leaks are retribution against Mr. we are an anti-Muslim country, Trauma. And for those who espe-
dicted by news reports. In his resignation letter, Flynn by an intelligence community aggrieved equating the U.S. with Vladimir Pu- cially enjoy how Mr. Krugman was so
tin’s authoritarian regime in Russia, utterly incorrect, we need a new
the former intelligence officer said he had given by Mr. Trump’s negative comments during the
obsessing over the size of the crowd term: KrugmanTrumpenfreude.
Vice President Mike Pence “incomplete infor- campaign, then the White House has a bigger at his inauguration, promising an ex- SAM KAZMAN
mation” about whether he had discussed U.S. problem than a national-security job opening. penditure of government resources Competitive Enterprise Institute
sanctions against Russia on these calls. It faces a bureaucratic insurrection that can do to investigate fraud in the popular Washington
Initially Mr. Flynn claimed Russian sanc- great damage with other leaks that may or may vote, without any evidence that it
tions hadn’t come up in the conversations, and not include accurate information. may have occurred, and attacking Mr. Epstein sees progressive
that’s what the Vice President said in defending This should also worry civil libertarians who our intelligence agencies. Mr. Ep- Americans like me as self-righteous
him on CBS’s “Face the Nation.” But U.S. offi- claim to be worried about the surveillance state. stein’s article reminds me of the doc- and condescending toward President
cials then leaked to the press that transcripts Yet the same voices who call Edward Snowden tor who tells a patient that is bleed- Trump, but I disagree. I see real fear
of Mr. Flynn’s phone calls show that sanctions a hero don’t seem concerned about the leaks of ing profusely from his right arm that for our unity as Americans, our ide-
were discussed. “This was an act of trust, these transcripts about Mr. Flynn. They fret because there is nothing wrong with als and our safety from terrorism.
his left leg, it must all be in his Schoolyard silliness about Mr.
whether or not he misled the Vice President about Mr. Trump’s speculative authoritarian head. Trump’s curious hair has nothing to
was the issue,” White House press secretary menace but don’t want to ask if authoritarian TOM QUIGLEY do with my deep concerns about his
Sean Spicer said Tuesday. tactics were used against Mr. Flynn. Garden City, N.Y. ability to lead us wisely and fairly.
Fair enough, if that’s the real reason. But as The House and Senate intelligence commit- JYL LEININGER
troubling is the fact that Mr. Flynn may have tees ought to include any FISA warrants and Over a year ago, Paul Krugman Seattle
been targeted for political destruction by intel- leaks as part of their probe. Someone—perhaps
ligence sources inside the government. We the President—should declassify any FISA or-
wrote Tuesday that the existence of transcripts der request and the Flynn transcripts if they Fiduciary Rule Is Already Paying Dividends
of Mr. Flynn talking with a foreign official sug- don’t harm other reputations.
gests that he may have been the subject of a As for Mr. Flynn’s successor, the White Regarding “Trump Moves to Undo That certainly hasn’t been my experi-
Dodd-Frank” (page one, Feb. 3): I ence with the retirement industry,
Foreign Intelligence Surveillance Court (FISA) House is floating the names of three retired
have been a 401(k) committee mem- and I am thankful that the threat
warrant. military officers, including David Petraeus, who ber for our company for 16 years. We that the retirement industry would
Some media outlets have reported that the would be first-rate. But Mr. Trump may benefit have been stiff-armed by several have to act in the “best interest of
FBI requested the warrant as part of the from taking some time to consider what he re- fund providers as we attempted to their clients” allowed us to provide a
Obama Administration’s investigation into ally wants in that job. negotiate a lower-cost universe of lower-cost option to our partici-
contacts between associates of Mr. Trump He already has military voices in his councils funds for our participants. It was ob- pants.
and Russian banks. Democrats are now de- and perhaps he should consider other points vious to us in July 2015 when ru- JOHN N. MEEKS
manding hearings, which they believe will of view. He needs someone who understands mors of the fiduciary rule by the La- San Marcos, Texas
expose more serious and unseemly interac- strategy, not merely tactics; who has the bor Department began to surface in
tions between Vladimir Putin and the Trump strength and experience to impose some disci- our quarterly discussions with our What is so radical about requiring
campaign. The House and Senate intelligence pline on the NSC; and who will be an honest provider that there could be avenues investment advisers to act in the
for discussion of lower-cost options. best interest of their clients? As an
committees are already investigating Rus- broker who will give Mr. Trump genuine policy
As the April 2017 implementation attorney for 50 years who lived com-
sian election meddling. choices. Former diplomat John Bolton could date approached and our plan size fortably under that duty, and now a
But readers should understand how rare it also do the job. Better for Mr. Trump to take increased, those discussions moved retiree who relies on an investment
is for electronic intercepts of a private U.S. his time and get it right rather than make a forward with increasing velocity. As adviser for my family’s financial se-
citizen—which Mr. Flynn was at the time—to hasty pick he might later regret. a result, we have been able to sub- curity, I would expect nothing less.
stantially reduce the fund cost to our If President Trump feels other-

The Death of Kim Jong Nam

participants. wise, I propose that every invest-
I am convinced, absent the threat ment adviser who doesn’t comply
of the fiduciary rule, that our lower- with a client-first rule should be re-

F
irst reports are often wrong, espe- cession: “It does not fit with socialism and cost offering wouldn’t have been quired to formally notify the clients
cially when it comes to Pyongyang, my father was against it.” made available to our participants. of that fact. Then, watch as clients
My experience is certainly contrary flee to advisers who care.
but it’s worth noting Tuesday’s news He added that he remained in touch with to what your story reported that the Are you listening, SEC?
that Kim Jong Nam, the es- his uncle, Jang Song Thaek, roll back of the fiduciary rule would PHILIP MCBRIDE JOHNSON
tranged half-brother of The exiled brother of who was Pyongyang’s No. 2 provide participants “better choices.” Fernandina Beach, Fla.
North Korean dictator Kim North Korea’s dictator official and main link to the
Jong Un, was poisoned to Chinese government until
death in a Malaysian airport. is poisoned in Malaysia. Kim Jong Un executed him in
This has the look of another
overseas assassination by
2013.
Such comments and asso-
Two Views on the Precision of Climate Models
the Kim regime—and a reminder that behind ciations fueled speculation that China was Holman Jenkins writes: “Two mea- nificantly greater than 50%.
its missile launches and nuclear tests, North grooming Kim Jong Nam as a possible pup- surements separated by less than the Mr. Jenkins is correct in saying that
margin of error are the same” scientists should be more explicit in
Korea remains an inherently unstable and pet in case Kim Jong Un was deposed.
(“Change Would Be Healthy at U.S. Cli- recognizing the degree of uncertainty
vulnerable regime. There’s scant evidence to support this, but mate Agencies,” Business World, Feb. in their measurements. But he in turn
Kim Jong Nam, 45, was Kim Jong Il’s eldest an assassination in Malaysia would certainly 4). This statement is fundamentally un- should recognize that, in a complex
son and heir apparent until 2001, when he was confirm that Kim Jong Un considered him true and, were it to be accepted by pol- world, we must rely on probabilities as
caught trying to use a false Dominican pass- a problem. icy makers, would have severely nega- the basis of decision-making.
port to enter Japan and visit Tokyo Disney- Commentary on North Korean intrigue often tive consequences for the evaluation of ADAM KURLAND
land. Apparently sidelined by this embarrass- focuses on its sensational or otherworldly evidence. The concept of margin of er- New York
ing episode, he began living in the Chinese qualities, and this case may prove no different, ror is meant to recognize that, while
city of Macau while the younger brother was as news reports claim the hit was carried out the point estimate (in this instance, Statistics? Margin of error? Confi-
groomed in his place and took power after by female agents with poisoned needles or temperature) should be viewed as the dence intervals? Don’t be absurd. None
their father’s death in 2011. spray. More important, though, is to recognize most accurate one, there exists a de- of these things matter at the altar of
gree of uncertainty. To imply that this Climate Religion.
On the rare occasions he spoke out from the growing danger of a regime that is fanati-
uncertainty completely negates the un- As a petrochemical industry engi-
exile, Kim Jong Nam criticized the North Ko- cal, fragile—and has nuclear weapons. derlying assertion is equivalent to be- neer who cares deeply about climate
rean system. “North Korea should pay atten- The Trump Administration says it has lieving that one can’t make a judgment change, I am keenly aware of this. Most
tion to reform and openness. If it continues launched a North Korea policy review, and not without complete information. Saying people, however, aren’t going to be up-
like this, it cannot become an economic a moment too soon. Regardless of how or why two measurements are within the mar- set over the National Oceanic and At-
power,” he told a Japanese newspaper in 2011, Kim Jong Nam was killed, the U.S. and its al- gin of error doesn’t mean that the pre- mospheric Administration omitting ba-
contrasting his country’s poverty with China’s lies need plans to handle a Pyongyang palace dicted relationship isn’t true, but sic statistics when they believe that
success. He also condemned hereditary suc- coup as well as a nuclear assault. rather that scientists aren’t “X” cer- climate Armageddon is nigh. But they
tain. This “X” is generally equal to 95%, miss the larger point.

The ObamaCare Merger Deathblow

though not always. But it is always sig- From autonomous cars to the poten-
tial to genetically engineer your off-
spring or yourself, proper and fact-

T
he conceit that the five major commer- ObamaCare promotes and rewards health-care
A Very Human Abe Lincoln based scientific debate in the public
sphere will be paramount in this cen-
cial health insurers will consolidate to consolidation on the premise that larger conglom- Left Behind One Nation tury. If those debates are conducted in
three seems to be dissolving, as four of erates lead to efficiencies and are more respon- Perhaps Abraham Lincoln had feet the same frenetic and emotional fash-
those insurers called off a pair sive to government control. of clay, as Elizabeth Brown Pryor ion that climate is being debated, we
of mega-mergers on Tuesday. Antitrust kills two tie- By converting insurers into seems bent on proving in her “Six should all be concerned about how we
The immediate reasons were ups, but reform will public utilities, the law reduced Encounters With Lincoln,” reviewed might be branded or persecuted for
legal objections, but perhaps choice and eliminated most by Carol Bundy (Books, Feb. 4). The our opinion. We owe it to future gener-
this retreat is a sign of hope create a better market. margins for competition. Price image of Harriet Beecher Stowe and ations not just to make the right deci-
for insurance markets. controls suppress innovation her girlfriends laughing at him re- sions on climate, but also to conduct
minds me of Gen. George McClellan our debate on the issue in a manner
After 18 months of court- and discourage new entrants.
strutting about in his tailored uni- consistent with the scientific method
ship among the Big Five starting in 2015, the out- The ObamaCare business, which has left most in- form and calling Lincoln a “baboon,” we claim to cherish.
going ObamaJustice Department’s antitrust divi- surers underwater, was never the great profit- but never quite managing to get his TOM MYSZ
sion sued to block the $34 billion Aetna-Humana making opportunity that some imagined in troops deployed effectively. As Ms. Oakland, Calif.
tie-up as well as Anthem’s $48 billion acquisition 2009-2010. The CEOs pursuing mergers were re- Stowe and Ms. Pryor wrote their
of Cigna. Federal judges blocked both transac- sponding to ObamaCare’s regulatory logic. books, neither had the responsibility
tions earlier this year. Anthem had planned to ap- But that logic is less persuasive now that of dealing with casualty reports, ur- Pepper ...
peal but on Tuesday Cigna pulled the plug after Congress plans to break up the ObamaCare sta- gent requests for supplies, horren-
Aetna and Humana did the same. tus quo to nurture a more vibrant insurance dous personal losses, the need for
And Salt
This is due less to the legal merits than to the market. Deregulation would allow insurers to of- immediate decisions and political chi- THE WALL STREET JOURNAL

pliability of antitrust law that lets enforcers and fer a wider selection of benefit designs and canery by all and sundry.
The indisputable fact is that when
judges define a market as they see fit. The higher-value options and prices.
Lincoln died, he left behind one na-
court’s analysis of the Anthem “market” was Competition may come back in style, not tion. Now, perhaps more than any
limited to “national accounts”—large businesses least because innovations in health-care organi- time since then, we need to be re-
with more than 5,000 employees in at least two zation seldom emerge from huge bureaucracies. minded of his admonition to over-
states, which is suspiciously specific. They come from entrepreneurial businesses come our human failings and listen to
The Aetna deal was meant to expand partici- with new ideas, and investors are less likely to our better nature: “With malice to-
pation in Medicare Advantage, which allows se- back them if they face a rampart of entrenched ward none, with charity for all.”
niors to opt for private plans. The trial judge incumbents. There has been no new net health PAT DICK
ruled that fee-for-service Medicare doesn’t com- insurance business formation since 2008, which Castle Rock, Wash.
pete with Advantage plans, when the reason the is not a sign of economic health.
Advantage alternatives exist is to drive down The for-profit insurance industry will survive Letters intended for publication should
premiums or improve quality through competi- with five independent companies, and maybe be addressed to: The Editor, 1211 Avenue
of the Americas, New York, NY 10036,
tion with traditional Medicare. even improve with more startups in a deregu- or emailed to wsj.ltrs@wsj.com. Please
In theory, the mergers are justified by econo- lated market. Meantime, the Trump antitrust include your city and state. All letters
mies of scale and to build negotiating leverage team can improve on the record of its predeces- are subject to editing, and unpublished
against the increasingly consolidated and some- sors by next working to break up ObamaCare’s letters can be neither acknowledged nor “Today’s meeting is about sales
returned.
times oligopolistic hospital supersystems. local hospital monopolies. quotas, yes, but love will find a way.”
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL.
A Step Toward Mideast Peace: Tell the Truth
By Max Singer
D
onald Trump ran for presi-
dent pledging to throw off
political correctness and
tell bold truths. That’s
something to keep in mind
this week. On Wednesday Israeli
Prime Minister Benjamin Netanyahu
will visit the White House. Thursday
will bring Senate confirmation hear-
ings for David Friedman, Mr. Trump’s
nominee for ambassador to the Jew-
ish state. Both events offer an oppor-
tunity for the fearless truth-telling
that Mr. Trump promised.
Netanyahu’s Washington
visit is an opportunity
to debunk pernicious
falsehoods about Israel.
The U.S. has long favored Israel,
even during the relative chill of the
Obama administration. Washington
has nevertheless parroted or pas-
sively accepted the conventional
falsehoods about the Israeli-Pales-
tinian conflict. If Mr. Trump wants
to advance the possibility of peace,
he should begin by challenging the
five big untruths that sustain the
anti-Israel consensus:
• Israel occupies “Palestinian terri-
tory.” This is nonsensical: There
never has been a Palestinian govern-
ment that could hold any territory,
meaning Israel could not have taken
“Palestinian land.” Quite possibly
large parts of the West Bank should
become Palestinian territory, but that
is a different claim.
Make Big Banks Put 20% Down—Just Like Home Buyers Do
By Neel Kashkari
T
here’s a straightforward way to
help prevent the next financial
crisis, fix the too-big-to-fail
problem, and still relax regulations
on community lenders: increase capi-
tal requirements for the largest
banks. In November, the Federal Re-
serve Bank of Minneapolis, which I
lead, announced a draft proposal to
do precisely that. Our plan would in-
crease capital requirements on the
biggest banks—those with assets
over $250 billion—to at least 23.5%.
It would reduce the risk of a taxpayer
bailout to less than 10% over the next
century.
Alarmingly, there has been recent
public discussion of moving in the op-
posite direction. Several large-bank
CEOs have suggested that their capital
requirements are already too high and
are holding back lending. As this
newspaper reported, Bank of America
CEO Brian Moynihan recently asked,
“Do we have [to hold] an extra $20 bil-
lion in capital? Which doesn’t sound
like a lot, but that’s $200 billion in
loans we could make.”
It is true that some regulations
implemented after the 2008 financial
Seeking Their Own Refuge, Sanctuary Cities Go to Court
Within days of Pres-
ident Trump’s exec-
utive order to crack
down on so-called
sanctuary cities,
San Francisco had
filed a lawsuit op-
UPWARD
MOBILITY posing the order,
By Jason L.
and the mayors of
other cities with
Riley
large immigrant
populations—Los
Angeles, Chicago, New York—had
likewise vowed to defy the adminis-
tration. In other words, everyone
behaved as expected, which is the
problem.
There is no established legal def-
inition of a sanctuary city, but the
term usually refers to jurisdictions
that limit cooperation with federal
immigration officials to prevent ille-
gal aliens from being deported. The
order threatens to block federal
funding to uncooperative cities,
PUBLISHED SINCE 1889 BY DOW JONES & COMPANY
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The Trump administration should
always describe the West Bank as
“disputed” land and speak against the
phrase “Palestinian territory”—except
when used in the future tense. It
should also recognize that Israel came
to the territory it holds not only dur-
ing a defensive war but also through
historical and legal claims, including
the 1922 League of Nations mandate
to establish a Jewish homeland.
• Millions of Palestinian “refugees”
have a “right of return” to Israel. The
standard international view is that
Israel has prevented five million Pal-
estinians, many living in “refugee
camps,” from returning to their
homes. But practically none of these
people are refugees as normally de-
fined; rather they are the descen-
dants of refugees. The Arab world
has kept them in misery for three
generations to preserve their plight
as a weapon against Israel.
The U.S. has failed to challenge
this false narrative. It is the principal
financial supporter of Unrwa—the
United Nations Relief and Works
Agency for Palestine Refugees in the
Near East—whose sole purpose is to
provide for the basic needs of these
perpetual “refugees.”
Privately, American diplomats un-
derstand that the normal description
of Palestinian “refugees” is a fraud
and that these descendants have no
legal “right of return.” A first step to
peace, then, would be to end the cha-
rade and begin to dismantle Unrwa.
The Trump administration might also
mention the estimated 800,000 Jew-
ish refugees who, in the late 1940s
and early ’50s, were thrown out of
the Arab countries where they had
been living for millennia. Most of
them settled in an impoverished,
crisis are imposing undue burdens,
especially on small banks, without
actually making the financial system
safer. But the assertion that capital
requirements are holding back lend-
ing is demonstrably false.
How can I prove it? Simple: Bor-
rowing costs for homeowners and
businesses are near record lows. If
loans were scarce, borrowers would
be competing for them, driving up
costs. That isn’t happening. Nor do
other indicators suggest a lack of
loans. Bank credit has grown 23%
over the past three years, about twice
as much as nominal gross domestic
product. Only 4% of small businesses
surveyed by the National Federation
of Independent Business report not
having their credit needs met.
If capital standards are relaxed,
banks will almost certainly use the
newly freed money to buy back their
stock and increase dividends. The
goal for large banks won’t be to in-
crease lending, but to boost their
stock prices. Let’s not forget: That’s
the job of a bank CEO. It isn’t to pro-
tect taxpayers.
So if capital requirements aren’t
the problem, why does it feel so hard
to get a loan today? I can speak from
while the lawsuit argues that forc-
ing cities to comply is a violation of
states’ rights under the 10th
Amendment.
Defenders of sanctuary policies—
including many law-enforcement of-
ficials—maintain that cities are
safer when illegal immigrants are
free to report crimes to police with-
out fear of being deported. During
the campaign, however, Mr. Trump
vowed to end these renegade poli-
cies on the grounds, he said, that
sanctuary cities are more prone to
violent crime.
In fact, empirical studies have
long shown that the foreign-born,
regardless of legal status and coun-
try of origin, are arrested and incar-
cerated at lower rates than their
native-born counterparts. Net mi-
gration from Mexico has been zero
or negative in recent years, and ille-
gal border crossings are at their
lowest point since the 1970s.
Robert Thomson
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OPINION
Then-candidate Donald Trump with the Israeli prime minister, Sept. 25, 2016.
newborn Israel without international
assistance.
• Israelis and Palestinians have
comparable claims to Jerusalem. This
is the best example of the false
“evenhandedness” that has long char-
acterized American policy—saying,
for instance, that “Jerusalem is sa-
cred to both religions.” Although the
city’s Al Aqsa mosque is significant in
Islam, Jerusalem itself has essentially
no religious importance. It is not
mentioned in the Quran or in Muslim
prayers. It was never the capital of
any Islamic empire.
Peace requires recognizing three
things: that Jerusalem must remain
the capital of Israel; that the city’s re-
ligious sites must be protected and
free, as they have been only under
the Jewish state; and that any provi-
sion for a Palestinian capital must
not threaten the city’s peaceful unity.
A bold truth-teller would also move
the U.S. Embassy to Jerusalem, de-
spite the threats of a violent re-
sponse, and would allow the pass-
ports of American citizens born in
firsthand experience. Last year my
wife and I decided to buy a house. We
applied for a loan with a bank where I
have been a customer for many years.
I assumed that my long record with
the bank and our good credit would
make it easy. With the required 20%
down payment, we were prequalified
Financial CEOs say capital
requirements are already
too high, but the facts
suggest otherwise.
for a mortgage with a rate of 3.375%
fixed for the first 10 years. That was
an attractive rate, suggesting capital
was not holding back lending.
The prequalification was easy.
Then the frustration began. The
mortgage banker asked for myriad
documents: bank statements, 401(k)
statements, brokerage statements,
tax returns, W-2s, insurance records
and so on. That all seemed reason-
able, but as the weeks rolled on, the
requests for more documentation
kept coming. After a month or so, I
Mr. Trump’s claim that illegal im-
migrants drive murders, rapes, as-
saults and other violent crime is
also divorced from the reality that
crime rates in the U.S. plummeted
in recent decades even as illegal im-
migration soared.
From the mid-1990s through the
mid-2000s, the country’s undocu-
mented population doubled to
roughly 12 million. Over the same
period violent crime in the U.S. fell
by more than a third, and property
crime dropped more than 25%, in-
cluding in border cities like San Di-
ego and El Paso, Texas, which are
home to large numbers of illegal
immigrants. Violent crime in the
U.S., by and large, is homegrown,
even if undocumented foreign na-
tionals provide convenient scape-
goats for politicians.
Statistical evidence, however
compelling, is often no match for a
powerful anecdote. And in con-
demning sanctuary cities Mr. Trump
has regularly invoked the tragic
death of Kate Steinle, who was mur-
dered in 2015 on a San Francisco
pier by an illegal immigrant who
had been convicted of numerous fel-
onies and deported multiple times.
If local law enforcement, who had
Notable & Quotable: Irrelevant
Jim Newell writing at Slate.com,
Feb. 13:
The House Democratic caucus
does not like being called irrelevant.
“There’s so much buzz in the
press, ‘Oh, you’re Democrats, you
don’t have any power in the House of
Representatives, you’re gonna be ir-
relevant,’ ” Rep. Steny Hoyer said
Wednesday in Baltimore. “We’re not
irrelevant, not at all.”
Let us try to understand why
Wednesday, February 15, 2017 | A17
REUTERS
the capital to record that they were
born in Israel.
• There was no ancient Jewish
presence in Israel. Palestinian leaders
insist that this is true, and that the
historical Jewish temples were not
actually located on the Temple Mount
in Jerusalem. This feeds their claim
that the Jews came to Israel as for-
eign colonialists imposed by the Eu-
ropeans after the Holocaust.
This falsehood can be sustained
only because it is politely tolerated
by the U.S. and Europe—and some-
times supported by U.N. agencies like
Unesco. It works against the possibil-
ity of peace by denying the Palestin-
ians a moral basis for negotiating
with Israel. The Trump administra-
tion should contradict these absurd
denials of history so often that Pales-
tinian leaders begin to look foolish to
their own people.
• The Palestinians are ready to
accept a “two-state solution” to end
the conflict. The U.S. has a tendency
to assume that Palestinian leaders
are ready to accept Israel if suitable
couldn’t believe what I was being
asked for. Despite having all the re-
cords of my on-time monthly rental
payments in my checking account,
the bank demanded a copy of my
lease and to speak with my landlord.
The banker called me to apologize,
admitting that the requests were ri-
diculous but saying that there was no
reasoning with the underwriting de-
partment. As we waited, we began to
wonder if we wanted to buy the
house at all. Wouldn’t continuing to
rent be so much easier?
In the end, the bank funded the
loan. I felt bad for the underwriters,
who seemed unable to exercise judg-
ment or use common sense. The im-
pression I got was that people at the
bank were simply paralyzed by fear—
that they might make a mistake, that
regulators would be breathing down
their necks.
I have spoken to many borrowers
at other banks, and they tell me simi-
lar stories. It has become needlessly
difficult for qualified borrowers to
get loans. But again, the problem
isn’t the capital requirements—it’s
everything else.
Capital is the best defense against
bailouts. Although capital standards
the alleged assailant in custody,
had complied with the federal gov-
ernment’s request to detain him un-
til it could be determined whether
he should be deported, Steinle
might still be alive. Her death was
Trump’s other executive
order on immigration
could make America’s
streets less safe.
a statistical aberration, but that’s
of little comfort to her family and
millions of other sympathetic
Americans wondering why our im-
migration policies don’t seem to
prioritize their safety.
Which gets us back to the oppo-
nents of Mr. Trump’s executive or-
der. Sanctuary cities are the excep-
tion, not the norm. Most
jurisdictions readily comply with
federal requests to assist in immi-
gration enforcement. But it’s also
true that the illegal immigrant pop-
ulation is concentrated in progres-
sive strongholds such as Los Ange-
les and New York, where defiance of
some members of the press might
have this impression, which the
House minority whip categorizes as
false. To be in the Democratic minor-
ity in the House of Representatives
. . . is to have near-negligible control
over the ship of state. Senate Demo-
crats still have some leverage, for
now, with what remains of the fili-
buster. Democrats in the House can
stop nothing that hits the floor from
passing—only Republicans’ internal
divisions can achieve that.
concessions are offered. The Trump
administration ought to ask: What is
the evidence for this? When did the
Palestinians give up their long-term
commitment to destroy Israel, and
which leaders backed such a dramatic
change? Undoubtedly, many Palestin-
ians are willing and even eager for
peace. Yet it is still taboo in Palestin-
ian debate to publicly suggest accept-
ing Israel’s legitimacy or renouncing
the claims of the “refugees.”
Washington is practiced at super-
ficial evenhandedness, always issuing
parallel-seeming statements about
both sides. What the Trump adminis-
tration can bring is genuine even-
handedness: respecting each side’s
truths and rejecting each side’s false-
hoods, even when this leads to a po-
sition that seems “unbalanced.”
Israel, too, should move toward a
strategy of truth-telling and stop ap-
peasing the false international consen-
sus. It ought to make its case defiantly
to the world. Israel can be ready and
willing to make concessions for peace
without pretending that today there
are any terms on which the Palestin-
ians are willing to agree. The Israelis
should continue to help the Palestinian
economy but not refrain from publiciz-
ing the ways that Palestinians sabo-
tage the effort and undermine their
own welfare.
Even in a conflict as fraught as
this one, there remain underlying
truths—and American policy in the
Middle East will benefit from telling
more of them.
Mr. Singer, a founder of the Hud-
son Institute, is a senior fellow at the
Begin-Sadat Center for Strategic
Studies at Bar-Ilan University in Is-
rael.
are higher than before the last crisis,
they are not nearly high enough. The
odds of a bailout in the next century
are still nearly 70%. Large banks need
to be able to withstand around a 20%
loss on their assets to protect against
taxpayer bailouts in a downturn like
the Great Recession, according to a
2015 analysis by the Federal Reserve.
Unfortunately, regulators have taken it
easy on the large banks, which today
have only about half of the equity they
need.
There is a simple and fair solution
to the too-big-to-fail problem. Banks
ask us to put 20% down when buying
our homes to protect them in case we
run into trouble. Similarly, taxpayers
should make large banks put 20%
down in the form of equity to prevent
bailouts in case the financial system
runs into trouble. Higher capital for
large banks and streamlined regula-
tion for small banks would minimize
frustration for borrowers. If 20%
down is reasonable to ask of us, it is
reasonable to ask of the banks.
Mr. Kashkari is president of the
Federal Reserve Bank of Minneapolis
and a participant in the Federal Open
Market Committee.
the new president is not only ap-
plauded but demanded.
“Given their state’s demographic
shift, California politicians have no
incentive to work with Washing-
ton,” writes David DeVoss in the
Weekly Standard. “Those who fail to
muster sufficient outrage invite ac-
cusations of racism and bigotry.”
California is home to about a quar-
ter of the country’s 11 million illegal
immigrants, he notes, and “Los An-
geles remains a city where a Trump
bumper sticker is an invitation to
have your car keyed.” The liberals
who run these deep-blue metropo-
lises are dug in against the presi-
dent.
Nor is it certain that the sanctu-
ary order will fare any better under
court challenges than has the tem-
porary travel ban. Last year, a fed-
eral judge in Illinois ruled that it
was unconstitutional for the De-
partment of Homeland Security to
force local jails to detain suspected
undocumented immigrants without
a warrant. And in a 1997 Supreme
Court decision, Printz v. U.S., a 5-4
majority held that the federal gov-
ernment “may neither issue direc-
tives requiring the States to address
particular problems, nor command
the States’ officers, or those of their
political subdivisions, to administer
or enforce a federal regulatory pro-
gram.”
Sanctuary cities are more of an
effect than a cause of illegal immi-
gration. The failure of the federal
government to pass comprehensive
reform has left states and cities
fending for themselves. A provoca-
tive executive order might fulfill a
campaign promise, but it won’t
solve the underlying problem, which
is an immigration system that is
ill-equipped to serve the country’s
economic and security needs in the
21st century. That will take legisla-
tion and leadership.
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A18 | Wednesday, February 15, 2017 THE WALL STREET JOURNAL.

WORLD NEWS

Russia Accused of Meddling in French Vote

Presidential candidate The accusations raise the to interfere with Mr. Macron.
specter of Moscow persisting “Macron is the candidate
Emmanuel Macron with what American and Euro- who doesn’t have support from
says Moscow seeks to pean officials describe as an Russia, for very simple rea-
effort to delegitimize Western sons,” said Thomas Gomart,
torpedo his campaign democracies through hacking president of the French Insti-
and misinformation. U.S. intel- tute of International Relations.
BY SAM SCHECHNER ligence agencies say Kremlin- “He is pro-Europe, pro-German,
AND MATTHEW DALTON backed hackers breached email and he believes that the euro is
accounts of Democratic Party a good thing.”
PARIS—In the wake of al- officials and leaked their con- Ms. Le Pen has vowed to pull
leged Russian interference in tents to tilt the election for France out of the North Atlantic
the U.S. presidential election, President Donald Trump. Treaty Organization and the
a front-runner in France’s The threat of Russian inter- European Union, alliances Mr.
presidential race is accusing ference has French security Putin sees as threats to Russia.
Moscow of doing it again. services on high alert, said an Mr. Fillon has also pledged to
The campaign of candidate official in the French presi- mend ties with Moscow. Both

AGENCE FRANCE-PRESSE/GETTY IMAGES

Emmanuel Macron said Tues- dent’s office. The services reg- he and Ms. Le Pen oppose exist-
day in an email to supporters ularly detect cyberattacks sus- ing EU sanctions on Russia for
that the Russian government pected of coming from Russia, annexing Crimea and support-
is trying to destabilize his can- but they haven’t uncovered ev- ing rebels in eastern Ukraine.
didacy by using state-funded idence the Kremlin ordered On Tuesday an Opinionway
media outlets to spread them, the official said. poll showed Mr. Macron garner-
smears about his character. The Kremlin on Tuesday re- ing 22% of the first-round vote
Mr. Macron’s political party jected the Macron campaign’s in April, second behind Ms. Le
En Marche, or On the Move, allegations, much as it has de- Pen with 27%. If the two went
has also been the target of nied involvement in hacking to the second-round runoff, the
about 4,000 attempts over the during the U.S. election. “Any French presidential contender Emmanuel Macron on Tuesday during a two-day visit to Algeria. polls said, Mr. Macron would
past month to disable or break allegations of official Moscow beat Ms. Le Pen 64% to 36%.
into its computer servers, possibly having anything to do cron’s campaign was an article and that “controversial details Mr. Macron’s top rivals, Marine —--Olga Razumovskaya
many from an unidentified with them [hacking] are ab- published Feb. 4 by Sputnik, a of his personal life” would Le Pen of the anti-immigrant in Moscow
hacker group partly using surd,” Kremlin spokesman news agency funded by the soon become public. National Front and François Fil- contributed to this article.
computer systems in Ukraine, Dmitry Peskov told Russian Russian government, claiming Sputnik denied spreading lon of the conservative Les Ré-
said Mounir Mahjoubi, the news agencies Tuesday. the candidate has a “very false information. The agency publicains party. But analysts  French bonds weaken amid
campaign’s digital director. Most worrying for Mr. Ma- wealthy gay lobby behind him” has also run articles critical of say Moscow has more incentive ‘Frexit’ worries........................ B14

Blacklisted Venezuelan Had a Ruthless Rise Greece

BY ANATOLY KURMANAEV Pushes
MARACAY, Venezuela—The
U.S. blacklisting of Venezuelan
Vice President Tareck El Ais-
Back at
sami puts a spotlight on the
son of Syrian and Lebanese
immigrants who rose to be-
Creditors
come the country’s second- BY MARCUS WALKER
most-powerful figure, former AND NEKTARIA STAMOULI
associates say, through busi-
ness pragmatism and political ATHENS—Greece is balking
ruthlessness. at creditors’ latest austerity
Venezuela’s Socialist gov- proposal, effectively ending
ernment on Tuesday rejected hopes of a deal this month to
U.S. allegations that Mr. El break the deadlock over the
Aissami aided drug traffickers, country’s troubled bailout.
calling them a baseless act of Prime Minister Alexis Tsip-
U.S. aggression. “This isn’t an ras’s government, led by the
attack just on Tareck,” Presi- left-wing Syriza party, wants a
dent Nicolás Maduro said on range of concessions—includ-
JUAN BARRETO/AGENCE FRANCE-PRESSE/GETTY IMAGES

state television with the vice ing promises on debt relief—

president at his side. “It’s an before it agrees to tax in-
attack on the revolution.” creases and pension cuts,
Venezuela’s Foreign Minis- which the International Mone-
try said the U.S. Treasury De- tary Fund and eurozone insti-
partment had committed “an tutions demanded on Friday.
international crime” on Mon- Greece’s decision to resist
day by subjecting Mr. El Ais- parts of the IMF-led demands
sami to individual sanctions, a means negotiations are likely
move Mr. El Aissami said to drag on for weeks, and po-
amounted to a recognition of tentially months, before Ath-
his “condition as an anti-impe- ens gets fresh money from Eu-
rialist revolutionary.” rope’s bailout fund to repay
As interior minister and heavy debts falling due in July.
governor of north-central Ara- Vice President Tareck El Aissami, left, raising a fist alongside an image of President Nicolás Maduro at a rally last month in Caracas. The prospect of a long con-
gua state, Mr. El Aissami used frontation is reviving market
his control of Venezuelan air ald Trump “wants to send a police to intimidate and re- Raised in the mountainous cut an unlikely revolutionary jitters about a possible Greek
bases, ports and highways to clear message to the people of press detractors. state of Merida as the son of a among chavista officials clad exit from the euro, leading to
ease drug shipments for Vene- Venezuela that America stands By jailing opponents and in- Druse Syrian-Lebanese family, in polyester Windbreakers and a recent selloff of Greek bonds.
zuelan, Colombian and Mexi- with them.” stalling friends in government Mr. El Aissami first emerged sweat-stained red shirts. However, the gap between
can drug organizations, ac- For the past decade Mr. El posts, oil executives and busi- in the late 1990s as a student While Mr. Maduro demon- Athens and its lenders is far
cording to the Treasury. Mr. Aissami has used proceeds ness leaders say, Mr. El Ais- leader of the leftist Utopia 78 ized businessmen, Mr. El Ais- smaller than in 2015, when
Maduro named him vice presi- from drug trafficking and ille- sami carried out a purge that movement. Since meeting Mr. sami worked to attract private Syriza first won election on a
dent only last month. gal passport sales to build a has paralyzed the oil industry. Maduro in 2001, Mr. El Ais- investment as Aragua’s gover- promise to end austerity, back-
By putting Mr. El Aissami parallel national intelligence “For him, money means po- sami’s ascent within the ruling nor. “He is only a socialist on ing down only after bank runs
on the blacklist—freezing his network, former colleagues litical power,” said Nixon Mo- party was swift. He served as the outside,” said a former and the imposition of capital
assets and barring U.S. compa- and people familiar with the reno, a longtime rival. the head of the country’s im- chavista official. controls took Greece to the
nies and individuals from do- U.S. investigation say. His for- The vice president’s office migration agency, lawmaker, —Juan Forero in Bogotá and brink of exit from the euro.
ing business with him—Trea- mer associates say Mr. El Ais- and the country’s Information interior minister and governor. Mayela Armas and Mariana This year, Mr. Tsipras is seek-
sury Secretary Steven sami used his control of the Ministry didn’t respond to re- Well-spoken and sharply Martínez in Caracas ing sweeteners to make the aus-
Mnuchin said President Don- country’s dreaded Sebin secret quests for comment. dressed, Mr. El Aissami has contributed to this article. terity medicine easier to swal-
low. The differences between
the fiscal proposals of Greece

President’s Absence Roils Already-Reeling Nigeria and its lenders are in the details.
The biggest gap is political.
Athens is looking for a way to
make fresh austerity digestible
BY JOE PARKINSON across Nigeria’s northeast. in a country that is deeply
AND GBENGA AKINBULE Diminishing Returns President Buhari’s greatest weary of a bailout that began
Since President Muhammadu success has been in rallying a in 2010 and still hasn’t put the
ABUJA, Nigeria—Roiled by Buhari's 2015 election, Nigeria's demoralized army and chasing country back on its feet.
antigovernment protests, re- economy has sunk into its worst Boko Haram back into its forest The IMF is looking to protect
vived insurgencies and its doldrums in decades. hideout; working with neighbor- its credibility, which has suf-
worst recession in three de- ing Chad, Niger and Cameroon fered from the failings of the
cades, Africa’s most populous 15.0 % change in GDP to reclaim territory that once Greek bailout. Eurozone govern-
nation is now fretting about 12.5 sprawled the size of Belgium. ments are eager to avoid domes-
the health of its president. Mr. Buhari in January tically unpopular concessions to
Muhammadu Buhari, the 74- 10.0 played a pivotal role in per- Greece ahead of elections in
BAYO OMOBORIOWO/ASSOCIATED PRESS

year-old who won the 2015 suading former Gambian Pres- Germany and elsewhere.
7.5
elections in Nigeria’s first dem- ident Yahya Jammeh to re- Data released on Tuesday
ocratic transition of power, this 5.0 spect his election defeat, showed Greece’s economy un-
month extended what had been deploying a Nigerian warship expectedly shrank 0.4% in the
2.5
billed as a 10-day vacation to off Gambia’s coast. fourth quarter last year.
London for undisclosed medical 0 But his economic inheritance
reasons. The former military has been less fortuitous than
ruler, deposed in a 1985 coup –2.5 that of Mr. Jonathan, who gov- Up and Down
before entering civilian politics, ’91 ’00 ’10 ’16* erned during an oil boom that Quarterly change in Greece’s
has yet to comment or offer *Estimate underpinned the rapid expan- gross domestic product
details on his health. Nigerian President Muhammadu Buhari, right, met with Gambia’s Source: International Monetary Fund sion of a Nigerian middle class
His office has insisted the then-president, Yahya Jammeh, left, in Banjul, Gambia, on Jan. 13. THE WALL STREET JOURNAL. in tandem with rampant cor- 2%
president is “hale and hearty” ruption. Critics argue Mr. Bu-
and has released pictures of him The questions about Mr. Bu- changes in economic policy. year-old Mr. Yar’Adua left for hari’s economic policy has
watching television and meeting hari—and concern over a poten- Some carried placards saying Saudi Arabia for medical treat- worsened the country’s malaise. 1
advisers. His wife, Aisha Mu- tial power struggle—come as Af- Mr. Buhari had “gone AWOL” ment and returned months Nigerian commentators say
hammadu Buhari, returned to rica’s top oil producer is gripped from the presidency. later on a life-support machine; there are important distinc-
Nigeria over the weekend. by a political crisis. The collapse Government ministers say he died shortly after. The tions between the optics of Mr. 0
“The president will soon re- in the price of oil—which con- the worst of the economic crisis power struggle during his ill- Yar’Adua’s illness and Mr. Bu-
turn to Nigeria and there’s no tributes some 95% of Nigeria’s is over and that efforts to dimin- ness elevated to the presidency hari’s, with the latter disclos-
cause to worry,” said Garba export revenue—has sparked a ish the country’s dependence on Goodluck Jonathan, a zoologist ing he was having medical –1
Shehu, a spokesman for Mr. Bu- foreign-exchange shortage that oil are starting to bear fruit. from the Christian south with a tests and promptly transferring
hari, on local television on has choked business activity. A The speculation over the reputation for deal making. legislative powers to his dep-
Tuesday, a day after the Nige- revived insurgency in the oil- president’s health has an The power vacuum caused uty, Yemi Osinbajo. –2
rian presidency said Mr. Buhari producing Niger Delta region added potency for many Nige- by Mr. Yar’Adua’s illness—and “I think that the health status 2014 ’15 ’16
discussed by telephone a possi- has exacerbated the crisis. rians, many of whom recall the its coverup by his advisers— of Mr. President is an issue that
Note: Data adjusted for inflation and
ble new arms deal with U.S. Last week, protesters gath- 2010 death of President Um- paralyzed the government only Mr. President would dis- seasonal effects
President Donald Trump as part ered in Abuja and the commer- aru Musa Yar’Adua. while the jihadist Boko Haram cuss at the appropriate time,” Source: Elstat
of terrorism-fighting efforts. cial capital Lagos to demand In November 2009, the 58- insurgency began to take hold Mr. Osinbajo said this month. THE WALL STREET JOURNAL.
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
BUSINESS & FINANCE
© 2017 Dow Jones & Company. All Rights Reserved.
S&P 2337.58 À 0.40% S&P FIN À 1.24%
GM Signals Retreat From Europe
Auto maker explores
sale of Opel business
to France’s Peugeot
as it focuses on profit
BY MIKE COLIAS
AND NICK KOSTOV
General Motors Co. is
weighing a sale of its belea-
guered Opel AG unit to French
car maker Peugeot, a bold re-
treat by Chief Executive Mary
Barra from the European mar-
ket and a firm reversal of the
megavolume strategy that
guided the auto giant for de-
cades.
The Detroit auto maker said
Trump Has
Hedge
Funds on
The Alert
BY ROB COPELAND
AND AARON KURILOFF
Wall Street’s early exuber-
ance at the election of Presi-
dent Donald Trump is giving
way to reticence and in some
instances outright hostility.
Billionaire hedge-fund
managers and day traders ini-
tially cheered Mr. Trump’s
surprise win, propelling major
U.S. indexes to all-time highs
on the hope of increased gov-
ernment spending, tax cuts
and loosened regulation.
Such Wall Street-favored
tax and economic policies,
however, are taking an early
back seat to Mr. Trump’s
moves on immigration and
surprising interactions with
foreign powers and would-be
congressional allies.
Closely followed traders
are warning in letters to their
affluent backers that all isn’t
as rosy as it seems. Some
warnings are rather more col-
orful than others.
Elliott Management Corp.
founder Paul Singer flagged
the risk of “deep underlying
complacency” in the face of
U.S. stocks that continue to
reach record highs. Seth Klar-
man of Baupost Group, bet-
ter known for sermons on
value investing, advised that
“the cynical exploitation of
fake news is a threat against
which we must all remain vig-
ilant.”
Hedge-fund
managers
including Paul
Tudor Jones,
left, have
shifted trading
strategies.
Basso Capital Manage-
ment’s Howard Fischer, a 30-
year hedge-fund veteran,
summed up the investing
world as a “stew of uncertain-
ties.” His take on Mr. Trump’s
first few weeks: “Dizzying,
startling and amazing.” In an
interview, he added another
adjective: “Disorienting.”
“I have to divorce how I
personally feel from the way I
trade and invest,” he said.
“You can call it somewhat of
an internal conflict.”
Many hedge funds are
loading up on cash and shel-
tering their portfolios from
the risks of an unknown fu-
ture.
Hedge-fund manager Paul
Tudor Jones, for example, one
of the world’s foremost mac-
roeconomic traders, is shying
away from trading some cur-
rencies, including the Mexican
peso, in part on the belief
that Mr. Trump’s unpredict-
ability may lead to severe
market swings, according to
people close to the firm. His
Tudor Investment Corp. has
set up email alerts to in-
stantly blast its traders when
Mr. Trump posts on the so-
cial- networking website
Twitter, the people said.
His main fund was down
Please see TRUMP page B2
TECHNOLOGY: JOANNA STERN ON CHROMEBOOK PRO VS. IPAD B4
* * * *
S&P IT À 0.28%
Tuesday it is discussing its ex-
isting partnership with Peu-
geot, including a possible sale
of a business that hasn’t
turned a profit this century.
Ms. Barra has been disman-
tling unprofitable operations
in recent years, including
abandoning Russia and certain
Asian markets. A sale of Opel
would essentially end the com-
pany’s business in the world’s
third-largest automobile mar-
ket.
Shedding Opel would re-
duce GM’s volume by 10% and
knock the No.1 U.S. auto maker
out of the chase to be the top
seller globally, a spot it owned
until recently.
A sale likely would boost
Felix Kjellberg at an
event in 2015.
YouTube Cancels PewDiePie Show
YouTube canceled its top
star’s show on Tuesday over
his anti-Semitic jokes, compli-
cating its efforts to court tele-
vision advertisers while also
retaining its edgy video stars.
YouTube, a unit of Alpha-
bet Inc.’s Google, distanced it-
self from its most popular cre-
ator—27-year-old Felix
Kjellberg, who goes by
PewDiePie—after The Wall
Street Journal reported he
made anti-Semitic jokes or
showed Nazi imagery in nine
videos since August.
Walt Disney Co., which
INSIDE
IMPORTS
SURGE INTO
U.S. PORTS
TRADE, B3
BIG STORES
STALL MALL
MAKEOVERS
PROPERTY REPORT, B8
THE WALL STREET JOURNAL.
DJ TRANS g 0.33% WSJ $ IDX À 0.13%
margins and free up money for
improving its position in more
profitable markets and pursu-
ing future technologies, such
as self-driving cars.
Auto executives have gener-
ally held that adding business
breadth through consolidation
could help them better allocate
capital. But Ms. Barra has said
margins outweigh market
share and—unlike many of her
peers—has shunted growth op-
portunities when the business
case is murky.
If Peugeot, known formally
as Groupe PSA SA, acquires
Opel and its U.K. division
Vauxhall, it would emerge as
Europe’s No. 2 car maker. GM
is looking for a multibillion-
helped run Mr. Kjellberg’s
business, severed ties after the
revelations.
By Jack Nicas,
Mike Shields
and Rolfe Winkler
YouTube canceled the sec-
ond season of Mr. Kjellberg’s
show, “Scare PewDiePie,”
which anchored YouTube’s
$10-a-month subscription ser-
vice. The company also pulled
his YouTube channel from its
Google Preferred program that
lets advertisers buy space be-
HEARD ON THE STREET | Charley Grant
Heed Political Ire Over Orphan Drugs
The latest
drug-pricing
drama has
pushed the
debate in a
new direc-
tion. It would be a mistake
for biotech shareholders to
dismiss the uproar as the
same old story.
Marathon Pharmaceuti-
cals’ decision to list the old
steroid deflazacort at an
$89,000 annual price to treat
Duchenne muscular dystro-
phy, and the resulting outcry,
has had an immediate im-
pact on the company.
Marathon said Monday
that it plans to delay the
drug’s U.S. launch, scheduled
for next month, after politi-
cians in Washington ex-
pressed anger over the com-
pany’s plans.
Marathon is hardly the
first company to anger the
public with a pricing deci-
sion. Tough talk on drug
pricing, a feature of Ameri-
LIBOR 3M 1.037
dollar amount for the Opel
brand, but discussions could
still fall apart, people familiar
with the matter said.
The development comes in
the wake of GM’s commitment
to add more than $1 billion to
its planned investments in the
U.S. Executives in the domestic
auto industry have faced criti-
cism from President Donald
Trump on Mexico imports, but
are optimistic about his pro-
posals regarding tax reform
and regulatory relief.
GM and Peugeot have
worked together since forging
an alliance in February 2012 to
co-develop vehicle platforms
and purchase vehicle compo-
nents. GM bought a 7% stake
J. COUNTESS/WIREIMAGE
fore “some of the most engag-
ing and brand safe” videos on
YouTube.
The PewDiePie channel has
amassed 53 million subscrib-
ers, nearly double the next
most popular YouTube chan-
nel.
However, Mr. Kjellberg can
still maintain a significant
presence on YouTube. He will
be able to post videos to his
channel, and ads can appear
before his videos, generating
income for him through
shared advertising revenue
with YouTube. Most ads on
can politics for decades,
hasn’t historically translated
into much action.
But the controversy has
introduced new risks that
shouldn’t go ignored. Mem-
bers of Congress are starting
to raise questions about the
Orphan Drug Act, which in-
centivizes companies to de-
velop treatments for small
populations.
The law has served the
drug industry well, and has
helped patients as well.
More than 575 medications
have been approved under
the law since it passed in the
1980s, according to the Food
and Drug Administration.
Signs are starting to
emerge that congressional
Republicans, long a staunch
ally of the pharmaceuticals
industry, are beginning to re-
consider whether the law is
too generous. Republican
Rep. Robert Aderholt of Ala-
bama said the episode makes
him question whether the
Wednesday, February 15, 2017 | B1
NIKKEI (Midday) 19473.50 À 1.22%
in Peugeot for $400 million in
2012, but sold its stake the fol-
lowing year.
Work continued behind the
scenes as both auto makers re-
covered from the eurozone cri-
sis and a six-year slide for the
region’s auto market. Formal
talks about a deeper alliance
began last spring and eventu-
ally included the prospect of
an Opel acquisition, according
to two people familiar with the
matter.
Ms. Barra has achieved a
number of financial targets,
but stanching Europe’s red ink
eluded her. A $300 million cur-
rency headwind unleashed by
the U.K.’s 2016 vote to leave
Please see BARRA page B2
Top of the Charts
The PewDiePie channel’s 53
million subscribers are nearly
double the next most popular
YouTube channel.
SUBSCRIBERS,
IN MILLIONS
AD REVENUE,
MILLIONS*
PewDiePie
53.2
HolaSoyGerman.
31.0
JustinBieberVEVO
27.2
RihannaVEVO
24.1
elrubiusOMG
23.1
Smosh
22.5
OneDirectionVEVO
21.5
TaylorSwiftVEVO
21.3
EminemVEVO
20.9
KatyPerryVEVO
20.8
*2016 estimate Source: NeoReach
THE WALL STREET JOURNAL.
the site are placed through au-
tomated auctions that match
ads with the demographic of
viewers marketers choose. In
Mr. Kjellberg’s case, his view-
ers are mostly male teenagers.
One advertiser who worked
with Mr. Kjellberg has already
distanced itself.
The YouTube star in De-
cember posted a paid promo-
tion for Nissan Motor Co.’s
Micra compact car. “We
strongly condemn this highly
offensive content and will not
work with him again,” a Nis-
Please see YOUTUBE page B4
Orphanage
Annual drug approvals
New orphan drugs All others
50
40
30
20
10
0 stances as a way to control
2014 2015
Note: Orphan drugs treat fewer than
200,000 Americans.
Source: Food and Drug Administration
THE WALL STREET JOURNAL.
current legal framework
“does more harm than good,
if companies have found a
way to game the system.”
His spokesman told The
Wall Street Journal that Mr.
Aderholt had expressed his
displeasure over Marathon’s
pricing with the Pharmaceu-
See more at WSJMarkets.com
SoftBank
To Acquire
U.S. Asset
Manager
SoftBank Group agreed to
buy asset manager Fortress In-
vestment Group LLC for $3.3
billion, a surprising move that
is part of an effort by the Japa-
nese technology firm to trans-
form itself into one of the
world’s largest investment
firms.
By Liz Hoffman, Jenny
Strasburg
and Sarah Krouse
Fortress Class A stockhold-
ers are to get $8.08 a share, the
companies announced late
Tuesday after The Wall Street
Journal reported on the deal.
That is 39% above the closing
price Monday, excluding divi-
dends. The shares surged
about 6% Tuesday before word
of the acquisition surfaced.
SoftBank, run by Masayoshi
$9.2
Son, one of the best-known and
most-colorful Japanese busi-
nessmen, is known for bold ac-
quisition moves in the technol-
1.8 ogy and communications arena.
In September, for example,
SoftBank purchased ARM Hold-
ings PLC, a U.K. designer of mi-
4.3
croprocessors, for $32 billion;
in 2013, it acquired control of
U.S. mobile-phone carrier
3.2 Sprint Corp.
The Fortress acquisition fits
Mr. Son’s ambitious long-term
2.2 plans to become one of the
world’s biggest asset managers,
focusing on technology but
with a broader platform to
5.2 raise money and shepherd com-
panies across different sectors.
In a statement, Mr. Son said the
1.7 acquisition, along with a gigan-
tic investment fund he is creat-
ing, will speed up a transforma-
tion aimed at long-term
7.3
growth.
Mr. Son is spearheading the
$100 billion fund to help put his
3.7 company and investors at the
forefront of emerging technolo-
gies such as artificial intelli-
gence and the Internet of
10.2
Things, in which everyday ob-
jects such as thermostats,
watches and cars are connected
online.
The deal will make SoftBank
one of the biggest alternative
asset managers in the world.
Fortress, which is listed on the
New York Stock Exchange, man-
ages about $70 billion in assets
and invests in real estate, credit
and private equity. The firm
was founded in 1998 and is led
by Chief Executive Randy Nar-
done, who, along with Pete
Briger and Wes Edens, will con-
tinue to lead Fortress.
The firm will continue to op-
erate independently within
SoftBank and be based in New
York.
Alternative-asset managers
like Fortress have emerged as
appealing targets to some in
part because they are able to
Please see DEAL page B6
tical Research and Manufac-
turers of America, a trade
group, over the weekend.
Marathon CEO Jeffrey
Aronin is a member of the
organization’s board of di-
rectors.
Meanwhile, three Sena-
tors, including two Republi-
cans, sent a letter to new
Health and Human Services
Secretary Tom Price calling
for the importation of drugs
from Canada in certain in-
2016 costs.
Changes to the law won’t
come easily. No politician
wants to be seen as standing
in the way of patients with
rare diseases, and not every
company is abusing the sys-
tem.
But if the industry doesn’t
do a better job of self-polic-
ing, more politicians may
start to reconsider their
stance.
That is a scenario that in-
vestors should dread.
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
B2 | Wednesday, February 15, 2017
INDEX TO BUSINESSES
These indexes cite notable references to most parent companies and businesspeople
in today’s edition. Articles on regional page inserts aren’t cited in these indexes.
Alder Hill
A
Airbus..........................B3
Management.............B8
Allergan.......................B6
AllianceBernstein
Holding......................B6
Alphabet ................ B1,B4
Amazon.com ............... B4
American Airlines
Group.........................B3
American International
Group.........................B6
Appaloosa
Management.............B6
Apple.........B3,B4,B6,B15
ARM Holdings.............B1
Astoria Financial ...... B15
AT&T............................B4
B H
Basso Capital
Management.............B1
Baupost Group............B1
Berkshire
Hathaway ............ B3,B6
BlackRock....................B5
Boeing ......................... B3
BofI Holding..............B15
C Mantle Ridge .............. B3
Canadian Pacific
Railway ..................... B3
Capcom........................B4
CC Land Holdings........B8
Chemours....................A2
Comcast.......................B3
CSX..............................B3
D O
Delta Air Lines ........... B3
INDEX TO PEOPLE
A Guelcher, Jeffrey ........ B8
Aderholt, Robert.........B1
Ammann, Dan.............B2
Aronin, Jeffrey............B1
B Herring, Gar................B8
Barra, Mary.................B1
Benson, Erik................B4
Berlau, John................B6
Buffett, Warren..........B3
C K
Combs, Todd................B3
Congemi, Frank.........A12
E T
Edens, Wes.................B1
F Lad, Sailesh...............B14
Flynn, Michael............A5
Frisch-Baldé, Aissatou
.....................................B8
G Mercier, Jean-Marc...B14
Garrabrants, GregoryB15
TRUMP
Continued from page B1
modestly in January. The peso
has been volatile this year.
Keith Meister, onetime
lieutenant to Mr. Trump’s
special adviser Carl Icahn,
said he now holds “a healthy
degree of skepticism around
both the ease by which the
Trump administration’s plans
may become a reality and the
odds of a major acceleration
of the economy,” according to
a February investor letter re-
viewed by The Wall Street
Journal.
Mr. Meister’s Corvex Man-
agement hedge fund in recent
weeks pared hard-to-sell
BARRA
Continued from the prior page
the European Union led to
losses last year, even as the
company reported $12 billion
in North American profit.
Abandoning Opel would
leave GM as the only top-tier
auto maker without a substan-
tial presence in Europe. Ford
Motor Co. and Fiat Chrysler
Automobiles NV make money
in the region, although those
margins are dwarfed by profit
earned in a North America
where pickup trucks and sport-
utility vehicles offer dispro-
portionate returns.
GM will “fish where the fish
are, or do business where the
money is,” GM President Dan
Ammann recently told analysts.
The company is also invest-
ing more in its aftermarket
parts business and lending
arm and in China.
Analysts said an Opel sale
would improve GM’s bottom
line and cash flow. GM shares
on Tuesday rose 4.8% in New
York, while PSA gained 4.3% in
Paris trading.
Adding Opel could help Peu-
geot, which owns the Citroën
brand, create a more balanced
geographic footprint and
would boost volume by one
million vehicles, or about a
third. Opel is stronger in its
home market of Germany and
the U.K., while Peugeot is
strongest in France and South-
ern Europe.
One of the developments
prodding GM executives to
consider ditching Opel is the
Dr Pepper Snapple
Group.......................B15
DuPont........................A2
E
Owlchemy Labs...........B4
P
PepsiCo......................B15
Petróleos Mexicanos B14
Elliott Management ... B1 Pfizer...........................B6
Emperor Group............B8 Procter & Gamble.......A1
Exelon..........................B5 PSA Group.................B15
F R
Facebook......................B4 Renault ................ B2,B15
Fang Holdings.............B6 RocketWerkz...............B4
Fortress Investment
Rolls-Royce Holdings..B3
Group.........................B1
S its chairman was resigning—all
G
Samsung Electronics
General Motors ... B1,B15
............................... B3,B4
Goldman Sachs.........B15
Savills..........................B8
Green Street
Advisors....................B8 Scana...........................B2
Sodexo.........................B5
Groupe PSA.................B1
SoftBank Group..........B1
Sony.............................B4
HSBC Holdings..........B14
Southern ..................... B2
HTC..............................B4
Southwest Airlines .... B3
J
Sprint.....................B1,B4
J.P. Morgan Chase....B15 T March 31 end of its fiscal year.
L T-Mobile......................B4
Lincoln National..........B5 Toshiba........................B2
M Tudor Investment.......B1
U runs at reactor projects in Geor-
Marathon United Continental
Pharmaceuticals.......B1 Holdings....................B3
Mitsubishi.................B15 V big that they could topple a
Mosaic.........................B2
Verizon
Mylan...........................B6
Communications.......B4
N Voyager Capital...........B4
Nissan Motor.......B1,B15 W book computers and the flash-
Walt Disney................B1
OCI...............................A2 Washington Federal . B15
N in which the company acknowl-
H Nardone, Randy..........B1
Hancock, Peter............B6 O make its personal-computer
Harrison, Hunter.........B3 Oppenheim, Noah.......B3
P
Hilal, Paul....................B3
Park Sang-jin .............. B3
I One of those who assumed a
Paulson, John..............B6
Icahn, Carl...................B6
Peltz, Nelson.............B15
Ingles, Adam...............B6 Peters, Sandra............B6
Price, Tom...................B1
Kjellberg, Felix............B1 S ness. The company said
Kleinberg, Adam.........B4
Shiga, Shigenori ......... B2
Krane, Jim.................B14
L Wednesday, and former West-
Tavares, Carlos ......... B15
Lack, Andy...................B3
Tepper, David..............B6
Turness, Deborah........B3
Lee, Jae-yong..............B3
Lempel, Eric................B4 W
M Weschler, Ted ............. B3
Z the inconvenience we have
Mo, Vincent.................B6 Zhang, Jingjing...........B5
stakes in companies including
pipeline operator Williams
Cos., and increased bets
against multinational fertil-
izer companies like Mosaic
Co. He has an eye on “misun-
derstandings that will inevita-
bly result” from Mr. Trump’s
trade policies, the letter indi-
cates.
The hedge-fund skeptics
aren’t alone in struggling to
figure out how to invest in
the Trump era.
“You see all-time new
highs day after day, a trajec-
tory with very low volatility,
valuation metrics that scare
you. You’re terrified when
you’re in and terrified when
you’re out,” said David Kotok,
chief investment officer at
Cumberland Advisors, in
KAI PFAFFENBACH/REUTERS
CEO Mary Barra has been dismantling unprofitable operations at General Motors in recent years.
tougher oversight on emis-
sions performance amid Volks-
wagen AG’s diesel scandal.
Tougher standards could has-
ten a transition toward electri-
fication as a dominant auto
technology in Europe, adding
significant cost.
Opel has racked up $15 bil-
lion in losses over the past de-
cade and a half. GM came close
to selling the unit in 2009 to Ca-
nadian auto supplier Magna In-
ternational Inc. but backed
away over concerns it would be
underrepresented in Europe.
An agreement to combine
Peugeot and Opel is likely to
face tough scrutiny in Paris
and Berlin, because both auto
makers employ tens of thou-
sands of people in their do-
mestic markets.
The French government
holds a 14% stake in Peugeot,
as do the Peugeot family and
New Woes Arise at Toshiba
BY TAKASHI MOCHIZUKI
TOKYO—Toshiba Corp.’s
problems threatened to spiral
out of control as the electronics
giant projected a $6.3 billion
write-down, postponed its
earnings report because of alle-
gations of impropriety and said
in the space of a day.
The delay in the earnings
report sent Toshiba shares
down 8% in Tokyo trading
Tuesday. At midday Wednes-
day in Tokyo, shares were
down 10%. Toshiba’s president
said he was willing to sell most
or all of Toshiba’s profitable
flash-memory business to help
the company survive past the
The latest troubles stem from
Toshiba’s U.S. nuclear-plant
business, Westinghouse Electric
Co., which is battling cost over-
gia and South Carolina.
The losses have gotten so
company whose roots go back
to 1875, the dawn of Japan’s
modern era. Known for its pio-
neering innovations in note-
memory chips that are
ubiquitous in today’s devices,
Toshiba has struggled in recent
years with the decline of its
consumer business.
A 2015 accounting scandal,
edged fudging numbers to
business and other units look
better, led to the resignations
of top officials.
top role in the wake of the
scandal was Chairman Shig-
enori Shiga, a longtime execu-
tive in Toshiba’s nuclear busi-
Tuesday that Mr. Shiga would
resign as chairman, effective
inghouse Chief Executive
Danny Roderick was stripped of
his executive post at Toshiba
headquarters.
“I apologize deeply for all
caused our stakeholders,”
Sarasota, Fla. He held 20% or
more cash in some accounts
in recent weeks, much of
which he subsequently in-
vested.
Relatively few prominent
investors openly backed Mr.
‘I have to divorce how
I personally feel from
the way I trade...’
says Howard Fischer.
Trump’s candidacy, and many,
Mr. Meister among them,
have acknowledged being sur-
prise at his win.
This isn’t the first time in
Chinese firm Dongfeng Motor
Group.
Together Opel and Peugeot
would command nearly 17% of
the European market, allowing
the French firm to leapfrog do-
mestic rival Renault SA and
become the biggest participant
on the continent after world
leader Volkswagen.
Opel employs 34,500 people
in Europe, with more than
16,500 in Germany. Peugeot
employs 184,000 world-wide.
It would be unconventional
for GM to abandon Europe,
where 15.1 million vehicles were
sold last year, said Warren
Browne, a former GM executive
who ran its Russian operations
before retiring in 2009. “Europe
is a mature market, but other
players are making money
there,” he said. “I don’t see how
you walk away and still be con-
sidered a global player.”
BUSINESS & FINANCE
Toshiba’s latest troubles stem from its U.S. nuclear-plant business, Westinghouse Electric.
Toshiba Chief Executive Sa-
toshi Tsunakawa said at a
news conference.
Toshiba’s willingness to sell
a majority of its main remain-
ing crown jewel, the memory-
chip business that supplies
smartphone makers such as
Apple Inc., marked a drastic
shift from its stance weeks ago
when it said it would limit any
buyer’s stake to 19.9%.
“The best possible option is
to sell everything because it
would be meaningless for
Toshiba to keep a minority
stake in the memory business,”
said Ace Research Institute an-
alyst Hideki Yasuda.
The company said its share-
holder equity fell into negative
territory as of Dec. 31, leaving
just a month and a half to find
ways to get back above zero
before the fiscal year-end.
Toshiba had been scheduled
to announce its April-December
results at noon local time Tues-
day, the final day for companies
to release quarterly results un-
der listing rules. But after that
hour came and went with no re-
lease, Toshiba said that it was
asking for a one-month delay.
recent years that hedge-fund
managers, among others, have
warned of trouble ahead, only
to be later forced to play
catch-up to surging stocks.
Many money managers have
an incentive to put out
gloomy prognostications be-
cause they are pitched as
portfolio protection in a down
market.
For now, Mr. Trump’s elec-
tion has been manna that
hedge funds desperately
needed after a poor stretch of
performance. The average
hedge fund gained 3% over
the past three months, ac-
cording to HFR. The S&P 500
is up 4% this year.
Those who react too
quickly to the perceived effect
of Mr. Trump’s actions have
Problem Child
GM's Opel, which is unprofitable,
has been struggling in a
sluggish European auto market
in recent years.
10 million vehicles
2016
Global GM
8 sales
10M
6
4
2
Share from
GM Europe
0 1.2M
2008 ’10 ’12 ’14 ’16
Note: Includes fleet sales and joint ventures
Source: the company
THE WALL STREET JOURNAL.
* **** THE WALL STREET JOURNAL.
It said an internal whistle-
blower had raised suspicions
that management at Westing-
house Electric had exerted in-
appropriate pressure over the
unit’s accounting. It said a law
firm hired by Toshiba had in-
terviewed those involved in the
issue and found inconsistencies
in their stories.
Toshiba said it couldn’t re-
lease official results while the
investigation continued. It
didn’t give details about the al-
leged pressure.
Later Tuesday, Toshiba re-
leased a presentation containing
many of the numbers that
would normally go in an official
results release, including the
¥712.5 billion ($6.3 billion) nu-
clear-business write-down.
Toshiba paid $5.4 billion
for Westinghouse in 2006, an-
ticipating a nuclear-power re-
naissance that never oc-
curred. Stricter safety
standards after the 2011 Fuku-
shima nuclear accident in
Japan added to the cost of
plants in China and the U.S.
“Our acquisition of West-
inghouse back then might not
have been the right decision,
been caught off guard.
In the weeks after the elec-
tion, Mr. Trump’s alternating
attacks and praise for compa-
nies as varied as Lockheed
Martin Corp., manufacturer
Rexnord Corp. and Ford Mo-
tor Co., pushed those compa-
nies’ stocks predictably down
or up, depending on the tenor
of his remarks.
Yet after Mr. Trump last
Wednesday criticized Nord-
strom Inc. for dropping his
daughter’s fashion label,
shares of the luxury retailer
rose 4.4% for the day, bucking
a flat day for U.S. stocks over-
all.
“I think the market’s be-
coming immune to that,” said
Erik Davidson, chief invest-
ment officer at Wells Fargo
JOHN BAZEMORE/ASSOCIATED PRESS
if you consider the numbers
today,” said Mr. Tsunakawa,
the chief executive.
The company confirmed re-
ports that it would stop build-
ing nuclear-power plants and
focus on selling reactor designs
as well as nuclear services.
Westinghouse is building re-
actors in Georgia and South
Carolina commissioned by utili-
ties Southern Co. and Scana
Corp., respectively. Scana was
down 4.5% and Southern was
off 1.3% in 4 p.m. New York
Stock Exchange composite trad-
ing Tuesday amid concerns the
projects could stall or the com-
panies might have to pay more
than expected to finish them.
A spokesman for Southern
said: “We recognize that
Toshiba is facing financial chal-
lenges and we are evaluating
how they could potentially im-
pact the project.” A spokes-
woman for Scana said the com-
pany wouldn’t discuss the issue
before releasing its earnings on
Thursday.
—Russell Gold,
Kosaku Narioka
and Megumi Fujikawa
contributed to this article.
Private Bank, referring to Mr.
Trump’s tweets.
Still, some influential in-
vestors typically content to
keep a low profile have come
out forcefully against Mr.
Trump and the impact of his
policies.
Mr. Klarman’s Baupost is
holding roughly $10 billion, or
one-third of its portfolio, in
cash, said two people close to
the firm, as it waits to see
what is to come.
“If things go wrong, we
could find ourselves at the
beginning of a lengthy decline
in dollar hegemony, a rapid
rise in interest rates and in-
flation, and global angst
about the stability and wis-
dom of American leadership,”
Mr. Klarman wrote.
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
THE WALL STREET JOURNAL. * * * * Wednesday, February 15, 2017 | B3

BUSINESS NEWS

Berkshire
Boosted
Apple Bet
Before Rise
BY NICOLE FRIEDMAN
Warren Buffett’s Berkshire
Hathaway Inc. increased its
stake in Apple Inc. by more
than 200% in the fourth quar-
ter, just before the iPhone
maker rallied to a record.
The purchases expanded
Berkshire’s stake in the tech-
nology giant to $6.6 billion as
of Dec. 31. Its 57.4 million
shares as of that date would be
valued at about $7.7 billion
CSX Takes Fight to Shareholders
Railroad company
reveals activist
investor’s demands
and calls for vote
CSX Corp. turned the tables
on an activist investor that
threatened a fight for control
of the railroad operator’s
board, revealing the investor’s
demands and calling for its
shareholders to vote on the
matter.
By David Benoit,
Jacquie McNish
and Paul Ziobro
The company said it made a

LUKE SHARRETT/BLOOMBERG NEWS

based on Tuesday’s closing
price.
Better-than-expected iPhone
sales, building anticipation for
the next edition of the phone
and hopes for a U.S. tax cut on
overseas profits have all
helped to boost Apple’s stock
in recent weeks.
Apple rose 1.3% Tuesday to
$135.02, a record close. Apple
is now valued at $700.5 billion
based on Tuesday’s closing
price, more than any other
company world-wide.
Berkshire first bought Apple
shares in May 2016 when
prices were near two-year
lows. One of Berkshire Chair-
man Mr. Buffett’s investing
lieutenants, Ted Weschler or
Todd Combs, was responsible
for the company’s initial Apple
investment. Apple shares rose
3.7% the day Berkshire’s initial
stake was revealed and have
largely been on an upward
trend since then.
Mr. Buffett historically has
shunned technology invest-
ments, saying they are outside
his “circle of competence,” or
written offer last week to hire
railroad veteran Hunter Harri-
son as chief executive and to
allow activist investor Paul Hi-
lal to nominate five directors.
But the company said talks fell
apart over Mr. Hilal’s demand
that CSX reimburse his fund,
Mantle Ridge LP, for “excep-
tionally unusual if not unprec- CSX’s direct appeal to shareholders is an unusual show of resistance and a role reversal for a target company of an activist.
edented” compensation bene-
fits for Mr. Harrison. appreciate that CSX sharehold- recently have complained that Pacific Railway Ltd. last CSX is at odds with Messrs.
The company said it would ers will have the opportunity to companies are bowing to ac- month to join forces with Mr. Hilal and Harrison over other
ask shareholders to vote on Mr. make their voices heard.” tivists without getting input Hilal. When he left CP, Mr. matters, including allowing an
Harrison’s employment terms CSX’s direct appeal to from other shareholders. Harrison gave up some $89 independent physician, chosen
and Mantle Ridge’s reimburse- shareholders is an unusual CSX’s board has come under million in compensation and by CSX’s board, to review Mr.
ment request at a meeting that show of resistance and a role pressure from shareholders to unspecified tax benefits. Harrison’s medical records.
hasn’t yet been scheduled. reversal of sorts for an activist hire Mr. Harrison. The com- CSX said Mantle Ridge Mr. Harrison in 2015 took sev-
They will also vote on Messrs. target. Activist investors often pany’s stock has risen more wants CSX to take on those eral weeks off from running
Harrison and Hilal’s proposed ask shareholders to choose a than 30% since The Wall Street costs. The total compensation CP to recover from surgery
governance arrangements. new slate of directors when Journal first reported on his package, including reimburse- and a bout of pneumonia.
CSX’s board doesn’t plan to their demands aren’t met. campaign with Mr. Hilal. ment for sacrificed pay and CSX, based in Jacksonville,
take a side ahead of the vote. Companies, for their part, usu- The company Tuesday took stock options, could exceed Fla., has been negotiating for
After the special meeting, the ally try to avoid shareholder the rare step of disclosing the $300 million, the company said. nearly four weeks primarily
company will call its normal an- votes, which are viewed as pair’s demands in detail. In a letter to Mr. Hilal last with Mr. Hilal. Mr. Harrison
nual meeting to elect directors. risky, expensive and time-con- Mantle Ridge, CSX said, week, CSX said the proposed has met twice with CSX direc-
In a statement, Mantle Ridge suming distractions. agreed to compensate Mr. Har- benefit package for Mr. Harri- tors to outline his plans for
and Mr. Harrison said that But several large institu- rison, 72 years old, for bene- son would benefit Mantle overhauling the railroad.
while they had hoped to reach tional investors, including fits he surrendered when he Ridge “at the expense of all —Maria Armental
a deal with the company, “we State Street Global Advisors, resigned as CEO of Canadian other CSX shareholders.” contributed to this article.

U.S. Ports Enjoy Recent Surge in Imports

areas of expertise. But Messrs.
Combs and Weschler, who are
slated to take over all the in-
vesting duties at Berkshire
whenever Mr. Buffett steps
aside, have shown a willing-
ness to wade into corners of
the market that Mr. Buffett
himself won’t touch.
Mr. Weschler explained the
investment in a June interview
with a German magazine,
though he wouldn’t confirm
BY ERICA E. PHILLIPS ries after the holidays while ates estimate import volume
simultaneously stocking up at the nation’s major ports
Imports surged at the na- ahead of the Lunar New will rise about 4.6% to 9.4 mil-
tion’s ports in January, Year—a major holiday in lion TEUs—potentially raising
buoyed by a postelection swell China during which the na- the trade deficit if exports
in consumer confidence, re- tion’s manufacturing facilities don’t outpace that growth.
tailer restocking after the hol- shut down for as long as three March imports are expected to
idays and a strong dollar that weeks. A stronger U.S. dollar rise 7.8%, while those in April
made imported goods cheaper. also made Chinese goods are estimated to grow 8.2%
NICK UT/ASSOCIATED PRESS

whether it was his position or
Mr. Combs’s.
Separately, Berkshire also
added a $2.2 billion stake in
Southwest Airlines Co. during
the fourth quarter and in-
creased its holdings in Ameri-
can Airlines Group Inc., Delta
Air Lines Inc. and United Con-
tinental Holdings Inc.
Berkshire’s third-quarter
2016 investments in American,
Delta and United surprised fol-
lowers of Mr. Buffett. The bil-
lionaire investor has criticized
airlines for decades as money-
losers. However, he told Char-
lie Rose in a January interview
that investing in airlines was
“in large part my decision.”
Mr. Buffett declined to com-
ment through an assistant.
The neighboring California cheaper for U.S. retailers in from a year earlier.
ports of Los Angeles and Long the final weeks of 2016, which Mr. O’Connell said Janu-
Beach imported 714,413 loaded may have further driven a ary’s strong volumes may be
20-foot equivalent units, a surge in retail orders. due to importers taking ad-
standard measure for con- But a drop-off in consumer vantage of exceptionally low
tainer cargo, in January. That confidence in recent weeks, ocean freight rates amid a glut
amounted to a 10.6% increase combined with backups re- of capacity in the ocean ship-
over a year earlier—the stron- Shipping container cranes at the Port of Long Beach, Calif. lated to the Lunar New Year ping business. Beginning in
gest import performance at Chinese export shipments to U.S. markets were up 6% in January. holiday, will likely slow the April, just three major ocean
the nation’s largest port com- flow of imports to the U.S. for carrier alliances will account
plex since last year’s peak Authority reported a monthly omist Jock O’Connell. the first half of February. The for the vast majority of trade
month of August. On the ex- record for container volume in Much of January’s strong Global Port Tracker report by to and from the U.S., and that
port side, Los Angeles and January, and the Port of Oak- import volume came from the National Retail Federation could drive up rates slightly,
Long Beach handled more land, Calif., said imports were China, where exports rose and Hackett Associates LLC Mr. O’Connell said.
than 600,000 TEUs, but more up 3.6% over the same month 7.9% globally from a year ear- estimates that February im- “It’ll definitely still be
than half of them were empty. last year. lier, producing China’s highest port volume will be slightly cheaper to make things in
According to research firm “We’re still seeing a modest monthly trade surplus in down from last year. China,” said Ryan Petersen,
Panjiva, which tracks trade amount of domestic economic nearly half a year. Still, March and April chief executive of Flexport
data, U.S.-bound ocean ship- growth in the U.S., generating Chinese export shipments should continue the growth Inc., a startup that arranges
ments increased 5% across all demand for imported prod- to U.S. markets were up 6% in trend, the monthly report international freight ship-
of the nation’s ports in Janu- ucts, and the dollar continues January, according to Panjiva, said. For the first half of the ments for small and midsize
ary. The South Carolina Ports to be strong,” said trade econ- as retailers restocked invento- year, NRF and Hackett Associ- companies.

BUSINESS WATCH
COMCAST For NBC News, a unit of by a settlement over corruption identified last month when seek-
Comcast Corp.’s NBCUniversal, charges, the fall in the British ing an initial arrest warrant for
NBC News Shuffles the partnership will give it a pound and setbacks on aircraft- the 48-year-old Samsung Elec-
Leadership Ranks strong international platform engine programs. tronics Co. vice chairman. A
and an opportunity to better Rolls-Royce, best known for court denied that request. Explore Costa Rica on a Caravan fully guided tour
NBC News is shaking up its compete with Time Warner Inc.’s making engines for Boeing Co. Prosecutors said they would

executive ranks in anticipation of
acquiring a stake in Euronews, a
European news channel that
reaches nearly 300 million
homes in Europe, Africa and the
Middle East.
In a memo to staff, NBC
News Chairman Andy Lack said
Deborah Turness, the president
of NBC News, will become presi-
dent of NBC News International,
a newly created position that
will oversee the partnership with
Euronews. Noah Oppenheim, a
senior vice president of NBC
News and the executive in
charge of NBC’s morning show
franchise “Today,” will succeed
Ms. Turness.
Both will report to Mr. Lack.
CNN International. NBC News and Airbus SE’s long-range
will also be able to draw from planes, reported an £83 million
Euronews reporting for its news profit for the prior year. The
platforms, including its morning loss in the latest year reflected
and evening news shows and its a noncash accounting hit from
MSNBC cable network. the revaluation of U.S. currency
As part of the agreement, hedges after the pound
Euronews will be rebranded as slumped following the country’s
Euronews NBC. vote to leave the European
—Joe Flint Union. It also included a £671
million, one-time charge for
ROLLS-ROYCE HOLDINGS bribery settlements with U.S.,
British and Brazilian authorities
Jet-Engine Maker after the company admitted to
Swings to a Loss illegal business practices.
The company’s closely
Rolls-Royce Holdings PLC watched underlying pretax profit
said Tuesday that it swung to fell for a third year to £813 mil-
a net loss of £4.03 billion
($5.05 billion) for 2016, stung
lion from £1.43 billion a year ear-
lier. Underlying sales fell 2% to
£13.4 billion.
—Robert Wall
SAMSUNG ELECTRONICS
Prosecutors to Seek
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 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 | Wednesday, February 15, 2017
Picking a Hybrid: Chromebook Pro vs. iPad Pro
M
icrosoft has its Sur-
face Pro; Apple has
its iPad Pro. Now
Google and Samsung have
teamed up on the Chrome-
book Pro.
Like the other two, this
$550 machine aims to be the
Swiss army knife of comput-
ers: It’s a lap-
top, tablet and
sketch-notepad
in one.
The
Chromebook
JOANNA Pro, with its
STERN Chrome oper-
ating system,
has the best
shot at being the just-right
tablet-laptop. With touch-
friendly Android apps, it
doesn’t have the Windows
problem that makes the
$830-plus Surface Pro (with
keyboard) a subpar tablet.
And with a full-fledged desk-
top-class web browser and a
basic file system, the
Chromebook Pro doesn’t
have the iOS problem that
makes the $750-plus 9.7-inch
iPad Pro (with keyboard) a
subpar laptop. Plus, it’s more
affordable than both.
On sale starting in April
and reviewed here, the
Chromebook Pro is the best
affordable laptop you can
buy; the nearly identical
$450 Chromebook Plus, with
a slower processor, is avail-
able now.
But the iPad remains the
best tablet. When weighing
these two choices, you’ll
have to decide which kind of
computer you want most.
PATRICK T. FALLON/BLOOMBERG NEWS
Vive virtual reality headsets from HTC got a workout at the Consumer Electronics Show in Las Vegas last month. HTC is offering support to videogame developers.
Pricey VR Headsets Are Slow to Catch On
BY SARAH E. NEEDLEMAN
When RocketWerkz Ltd.
released one of the first video-
games for virtual reality last
spring, developers at the New
Zealand studio were hopeful it
could break even—maybe even
turn a profit.
Neither happened. Its $20
strategy game, “Out of Ammo,”
has recouped only about 60%
of the roughly $650,000 spent
creating the game, according
to Dean Hall, the company’s
chief executive. For now, Rock-
etWerkz is going back to mak-
ing traditional computer
games.
Proponents have heralded
virtual reality, or VR, as the
next big step in computing.
But while VR goggles that
rely on smartphones have sold
well, sales of costlier headsets
Facebook Unveils Plans
For New Television App
BY DEEPA SEETHARAMAN
Facebook Inc. is launching
a television app.
On Tuesday, the social-me-
dia giant announced a soon-to-
come app that will allow users
to stream videos in their news
feed through set-top boxes such
as Apple Inc.’s Apple TV and
Amazon.com Inc.’s Fire TV as
well as Samsung Electronics
Co.’s internet-connected TVs.
The video app, first reported
by The Wall Street Journal, is
the latest example of Chief Ex-
ecutive Mark Zuckerberg’s effort
to transform Facebook into a
Design: In the Laptop
Olympics, the Chromebook
Pro lands an almost perfect
back flip from laptop to tab-
let. Its hinge is very sturdy
and in its landing tablet po-
sition, the 2.38-pound, 0.51-
inch-thick device is quite
svelte, at least for a laptop.
But because the keyboard
sticks to its back like a piece
of deli meat, it isn’t as com-
fortable to hold as the iPad
Pro (even with keyboard
case) when playing a racing
game or reading a long arti-
cle. That said, using the key-
board to prop the Chrome-
book Pro screen up like a
tent is a superb way to
watch Netflix in bed.
Keyboard: If composing
lengthy emails, documents
and Facebook posts is the
priority, pick the Chrome-
book Pro’s well-spaced and
comfortable keyboard. The
plastic keys have a bit too
much trampoline bounce and
they aren’t backlit. But I’ll
take them over the cramped
keys and uncomfortable
screen angle of the $150 iPad
Smart Keyboard Cover.
Screen: The Pro’s 12.3-
inch touch screen has a
wider aspect ratio than an
iPad’s, but not as wide as a
phone’s or a TV’s. The crisp,
bright 2,400- x 1,600-pixel
panel is good for movies, but
with space enough to place
apps side by side.
Stylus: Out of the right
side of the Chromebook pops
a stylus about the size of a
McDonald’s french fry. Simi-
lar to the pen that comes
that tether to powerful com-
puters or videogame machines
haven’t lived up to the hype.
That has prompted some
developers to reconsider VR.
“The future of virtual real-
ity is very bright, but in the
short term it’s not where we
see ourselves,” Mr. Hall said.
“The return on investment is
not enough for us.”
Voyager Capital in 2015 in-
vested $100,000 in Envelop
VR, whose software lets users
in VR interact with traditional
desktop apps. The startup
closed its doors in January de-
spite raising more than $5
million, according to Erik Ben-
son, a partner at Voyager.
Startups committed to rid-
ing out VR’s bumpy start likely
face a more challenging jour-
ney than they envisioned, Mr.
Benson said. Envelop VR’s CEO
“video-first” company and com-
pete for TV ad dollars.
Through the video app, users
can watch videos shared by
friends or publishers and public
figures they follow. It will show-
case live broadcasts as well as
videos a user has saved to
watch later or already watched,
shared or uploaded.
“We want people to be able
to consume content wherever
they are—whether it’s on their
phone, whether it’s on their
computer—and TV is just an-
other screen for that,” said
Dan Rose, Facebook’s vice
president of partnerships.
TECHNOLOGY
Sup, Pro?
Apple, Microsoft and
Samsung's
tablet-laptop hybrids
make different
compromises.
SAMSUNG
CHROMEBOOK PRO
Starting price $550
(with keyboard)
Operating System Chrome OS
Screen 12.3 inches
Weight 2.4 pounds
Battery Life* 7h 25m
Pros • Full-size keyboard, trackpad • Great selection of apps
• Included stylus
• Simple software
Cons • Android apps need work
• Clunky in tablet mode
• Performance can get slow
Source: the companies
with Samsung’s Galaxy Note
phones, it can be used to
navigate around, take notes
and sketch mustaches on
your selfies.
However, the stylus
lagged behind the $100 iPad
Pencil when trying to keep
up with my fast note-taking
in a meeting. The only pre-
loaded app with real pen
support is Google Keep, and
the keyboard’s handwriting-
to-text conversion is flaky. I
had to turn to a third-party
app, Adobe’s Fill & Sign, for
filling out and signing a PDF.
Battery life: As with an
declined to comment.
Research firm IDC put 2016
sales of higher-end headsets
such as Sony Corp.’s PlaySta-
tion VR, Facebook Inc.’s Ocu-
lus Rift and HTC Corp.’s Vive
at 2.2 million units generating
2.2M
Number of high-end headsets
sold in 2016, according to IDC.
roughly $1.4 billion.
The estimated results were
short of IDC’s projections, and
the firm nudged down its 2017
forecast to 6.4 million units
for $3.2 billion in sales.
Other research firms re-
YOUTUBE
Continued from page B1
san spokeswoman said in an
email Tuesday. She said that
Nissan had paid him for the
creation of the one ad spot but
had no ongoing relationship.
YouTube has positioned it-
self as advertisers’ preferred
alternative to television by
cultivating its video creators,
or so-called influencers, who
draw teenage audiences.
But the sheer variety and
unpredictability of much of
YouTube’s content still
makes advertisers wary of
shifting more of their spend-
ing away from proven TV
commercials.
APPLE
IPAD PRO
$750
iOS 10
9.7 or 12.9 inches
0.96 pounds (no keyboard)
8h 32m
• All-day battery life
• Smooth stylus performance • Included stylus
• Cramped keyboard; no USB
• Limited operating system
• Stylus costs $100 extra
iPad, you can leave the char-
ger at home. The Chrome-
book Pro lasted 7.5 hours on
our battery test, which loops
a series of websites with
brightness set to about 70%.
The 9.7-inch iPad Pro lasted
about an hour longer, but
Apple’s tablet also takes lon-
ger to fully charge. (And yes,
the Pro has two USB-C ports.
Prepare your dongles!)
Software: As a laptop op-
erating system, Chrome OS
can now pull off most tasks.
The Chrome browser is fast,
and it’s home to many of our
daily productivity web apps,
ported even wider shortfalls.
SuperData Research had ex-
pected 3.7 million units would
be sold last year, but its final
tally was 1.4 million.
SuperData said Sony’s Play-
Station VR led with about
745,000 units sold last year.
Facebook sold about 243,000
Rift headsets, while HTC sold
about 420,000 units of its Vive.
“All the enthusiasm from VR
manufacturers and developers
just hasn’t been met with the
same volume from the con-
sumer market,” said Shauna
Heller, founder of advisory firm
Clay Park VR and a former de-
veloper-relations specialist at
Facebook’s Oculus VR.
Supporters are convinced
VR will succeed. Nearly 10% of
people playing “Resident Evil 7:
Biohazard” on PlayStation 4 do
so in VR, according to Capcom
“YouTube and even Disney
have some blame in this situa-
tion,” said Adam Kleinberg,
head of San Francisco ad
agency Traction Corp. “You-
Tube is marketing their influ-
The unpredictability
of much YouTube
content makes
advertisers wary.
encer network as a safe place
for brands to interact…and
[PewDiePie] is their biggest
property.”
Mr. Kleinberg said his firm
has spent several million dol-
* *** THE WALL STREET JOURNAL.
MICROSOFT
SURFACE PRO 4
$830
Windows 10
12.3 inches
1.7 pounds (no keyboard)
5h 10m
• Power of a full laptop
• USB port
• Lacks great tablet apps
• Software can be bloated
• Sub-par battery life
THE WALL STREET JOURNAL.
such as email, calendar,
video chatting and document
editing. If you still need full,
processor-intensive desktop
apps, a costlier Windows PC
or Mac is your best bet.
With shortcuts for jump-
ing between open windows,
and a basic file system for
organizing and downloading
photos and documents,
Chrome OS has more of the
essentials to keep you work-
ing faster than Apple’s iOS.
However, even with the
Chromebook Pro’s faster In-
tel Core M processor, there
were times when I was wait-
Co., which made the game.
One barrier to wider use is
that casual observers can’t ex-
perience what makes VR spe-
cial simply by watching ads or
someone else don a headset.
“This is a hard product to
communicate,” said Eric Lem-
pel, head of marketing for
Sony’s PlayStation division.
“You have to put a headset on
and experience it.”
Headset makers are orga-
nizing demonstrations at more
public places, such as malls,
college campuses and festi-
vals. They are also working to
make VR more user-friendly,
such as by pursuing higher-
end headsets that don’t re-
quire a PC.
Meantime, Facebook and
HTC are supporting developers
with hundreds of millions of
dollars in assistance.
lars on YouTube ads over the
past year and would likely
blacklist PewDiePie’s channel
on all future campaigns.
By pulling the ads that run
before videos, thereby depriv-
ing creators of shared reve-
nue, or by removing the vid-
eos outright, YouTube risks
angering its influencers.
“Influencers are saying
YouTube is too strict, and
advertisers say it isn’t strict
enough,” said Jesse Leimgru-
ber, chief executive of Neo-
Reach, which helps compa-
nies advertise on social-
media influencers’ content.
YouTube’s crackdown on
PewDiePie “is definitely go-
ing to have a ripple effect in
the influencer community,”
he said.
WSJ.com/Tech
ing for the system to catch
its breath while switching
apps and tabs.
Apps: Chrome’s new sup-
port for all the Android apps
in the Google Play store is
partly to blame for those
performance issues. Running
touch-friendly apps on the
bigger screen has long been
the dream, and many can be
very useful. I far prefer Spo-
tify’s Android app to its web
app, for instance.
Yet of the dozen or so An-
droid apps I downloaded,
two issues seemed to be the
norm rather than exceptions:
Apps were often sluggish
and buggy, whether it was a
lightweight app like Face-
book or a processor-inten-
sive game like “Asphalt 8.”
Then, because the apps
were designed primarily for
phones, you’re stuck with ei-
ther an app that takes up a
quarter of the screen, or one
that’s stretched unnecessar-
ily across the whole thing.
Apple, by comparison, is
teeming with beautiful, de-
signed-for-iPad apps.
“We are actively trying to
investigate and solve the is-
sues before the product
launch,” said Kan Liu, senior
director, product management
for Google Chrome OS. Soft-
ware updates, Android app
support for keyboards and
trackpads, and renewed devel-
oper interest in making touch-
friendly large-screen apps will
solve many of the issues I ex-
perienced, Mr. Liu said.
Until then, the “Pro” still
stands for com-pro-mise.
Verizon’s
Unlimited
DataPlan
HasQuirks
BY RYAN KNUTSON
Like its rivals, Verizon Com-
munications Inc. has brought
back unlimited data plans. And
like its rivals, “unlimited”
comes with a few caveats.
All four U.S. carriers warn
they may temporarily slow
connections for the biggest
data users at times of heavy
network congestion. At Veri-
zon, after an unlimited sub-
scriber consumes 22 gigabytes
in a billing cycle, the carrier
“may prioritize usage behind
other customers in the event
of network congestion.”
While the average smart-
phone customer uses less than
5 gigabytes a month, those
who stream lots of video or
use their cellphones as Wi-Fi
hot spots can consume far
more. Watching an hour of
video a day for a month would
require about 10 gigabytes, ac-
cording to Verizon’s online
data calculator. AT&T says it
may take similar action to
throttle users at 22 gigabytes.
For Sprint, the magic number
is 23 gigabytes and at T-Mo-
bile it is 28 gigabytes.
That means that if a bunch
of customers connect to the
same cell tower at the same
time, users who have exceeded
those levels that month will get
a slower connection than every-
one else until the congestion
passes. A problem for smart-
phone owners is that it is hard
to know when or where that
might happen. Verizon says:
“While we don’t expect to do
that very often, network man-
agement is a crucial tool that
benefits all Verizon customers.”
Another restriction on Veri-
zon’s unlimited plan: custom-
ers can pay only with a debit
card or checking account.
That change is probably
saving Verizon 2% to 3% in
credit-card fees, according to
analysts at Evercore. Custom-
ers must also choose paperless
billing and enroll in autoplay
or else pay $10 more a month.
Verizon had stopped selling
unlimited plans in 2011 and con-
sistently said such plans don’t
make money. Several analysts
who studied the impact of the
unlimited plan, which costs $80
for a single phone and $180 for
four phones, said it would likely
be neutral to the company’s av-
erage revenue per user.
That is because while the un-
limited plan is priced below Ver-
izon’s bigger monthly data
plans, the company might en-
courage users with smaller plans
to pay up for data they don’t
consume.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. Wednesday, February 15, 2017 | B5

MANAGEMENT
WORKAROUNDS
Workplace Diversity Efforts Get a Reboot
In Trump era, U.S. companies rethink programs—with nod to white males and bottom-line results
TY WRIGHT FOR THE WALL STREET JOURNAL

BY JOHN SIMONS says Rohini Anand, global chief

Scotts Miracle-Gro CEO James
Hagedorn outside his plane.
Risk-Taking CEOs
Share a Hobby
There must be something in
the air.
Thrill-seeking chief executives
who pilot planes in their spare
time are more likely to inspire
original thinking at their compa-
nies, says Jingjing Zhang, an ac-
counting professor at McGill Uni-
versity and co-author of a new
study that surveyed more than
1,200 men and women in the
diversity officer at food-ser-
A new political era has vices and facilities-manage-
corporate diversity chiefs re- ment firm Sodexo SA.
thinking their roles. Ms. Anand says that in the
Donald Trump’s upset elec- current environment execu-
tion victory caused shock tives in her position should
waves among many traditional collect, analyze and share
politicians who realized that a data validating their work.
swath of American voters— She points to a study she con-
many white, working class—felt ducted of 50,000 of the com-
left out. The same realization is pany’s managers, partly to
causing companies to re-exam- demonstrate to her bosses
ine what they do to ensure an that gender balance on teams
inclusive workplace, from in- correlated with improved fi-
corporating white men into nancial performance, em-
their diversity efforts to look- ployee engagement and client
ing for bottom-line evidence of retention. Her study found
the benefits of such programs. that teams with a male-female
“The discourse in the U.S. ratio of between 40% and 60%
presidential election, even deliver optimal results.
though rancorous, was a As a result, Sodexo Chief
sharp reminder that we need Executive Michel Landel has
to address a broader set of di- set a goal that women will rep-
versity dimensions, in particu- resent at least 40% of Sodexo’s
lar, socioeconomic opportu- senior leadership—its top

GREG KAHN / GRAIN FOR THE WALL STREET JOURNAL

top job between 1993 and 2003.
As American companies set
their sights on the next block-
buster innovation, management
researchers are taking a fresh
look at where big ideas come
from. To spark new advances in
technology and science, it may
help for more top executives to
take flying lessons, according to
Ms. Zhang and her co-authors, in
the January issue of the Journal
of Financial Economics.
“Pilot CEOs are very different
from other people, willing to
take more risks in seeking the
experience and sensations re-
lated to flying and innovation,”
says Ms. Zhang, adding that
many of the adventurous busi-
ness leaders surveyed also raced
cars or engaged in daring out-
door sports such as skydiving.
Using certificate records from
the Federal Aviation Administra-
tion, the researchers found compa-
nies with a pilot in the top job
spent more on research and devel-
opment on average, and produced
nearly twice as many patents each
year as those with a nonpilot CEO.
Moreover, those patents tended to
be more diverse and interdisciplin-
ary, and had a higher impact, in-
spiring further innovation.
—Kelsey Gee
nity,” says Kara Helander, a
former diversity chief for
Blackrock Inc. who continues
to advise the financial firm.
She says leaders must rec-
ognize that some workers may
resent or feel excluded by di-
versity efforts focused on op-
portunities for workers from
underrepresented ethnic back-
grounds, or those who identify
themselves as lesbian, bisex-
ual, gay or transgender.
Many executives who run
diversity programs also
worry that the policy mo-
mentum that helped fuel
their efforts is set to fade.
Former President Barack
Obama pushed through a se-
ries of rules rewarding diver-
sity in the workplace, includ-
ing through executive orders
that set guidelines for pay and
hiring and that addressed
workplace protections for gay
and transgender people. The
Trump administration hasn’t
detailed proposals on these is-
sues but the president has
pledged to deregulate and
vowed to rescind many of Mr.
Obama’s executive orders.
In the wake of the election,
some diversity professionals
felt the need “to scramble to
Sodexo’s chief diversity officer, Rohini Anand, compared gender balance and teams’ performance.
have conversations and put to-
gether positions” defending
their work, says Mary-Frances
Winters, a consultant who has
advised American Airlines
Group Inc. and Walt Disney Co.
on diversity issues.
Some diversity chiefs have
taken on new roles as peace-
makers, attempting to main-
tain workplace harmony after
an election that divided em-
ployees along race, class, gen-
der and ideological lines.
On the day after the elec-
tion, Ms. Winters held an on-
line seminar for diversity ex-
ecutives and heads of
corporate ethnic- and gen-
der-based employee groups.
She encouraged the partici-
pants to help employees talk
about their differences while
seeking common ground.
Ms. Helander now encour-
ages leaders to cultivate
teams by recruiting from an
expanded pool of colleges and
universities or focusing work-
force development efforts on
regions that have lost manu-
facturing jobs, she says.
Executives say they are
looking critically at how they
go about their work, “hearing
from white men the same way
you’d hear from a woman or
someone who’s LGBT,” espe-
cially if they feel they are
missing out on career develop-
1,400 executives—by 2025. Ten
percent of senior executives’
annual bonuses are tied to
their progress toward that
goal, Ms. Anand says.
Worried that federal
guidelines on hiring diversity
and inclusion could be weak-
ened in an overall deregula-
tory push, Allison Green,
chief diversity officer at Lin-
coln Financial Group, called
an informal meeting with the
company’s in-house employ-
ment attorney in the days
following the election.
ment or other workplace op- Portions of the Dodd-
portunities, says Janese Mur- Frank financial regulatory
ray, vice president of diversity overhaul, which Mr. Trump
and inclusion at energy giant and the Republican congres-
Exelon Corp. sional leadership have vowed
Rather than simply in- to roll back, encourage com-
structing white male middle panies to create voluntary
managers on the proper standards for diversity in
ways to conduct themselves employment and in suppliers.
in a diverse workplace, Ms. Lincoln Financial’s policies
Murray suggests inviting mirror tenets of the Dodd-
them to round-table discus- Frank guidelines, and Ms.
sions with women and mi- Green wants to ensure that her
norities and encouraging colleagues remain committed.
them to air concerns. At the meeting, Ms. Green got
“We have to be much straight to the point: “Even if
sharper at our game than Dodd-Frank goes away, I think
we’ve ever been, and make this is a good policy to keep
sure that we don’t give back and leverage,” she told the at-
the progress we’ve made,” torney. He agreed, she says.

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B6 | Wednesday, February 15, 2017
A Dodd-Frank Statute Banks Like AIG
BY RYAN TRACY
Posts
Loss on can-favored changes to Dodd-
Republican promises to dis-
mantle the 2010 Dodd-Frank
financial overhaul may prove
good news for many financial
firms. The bad news for Wall
Street: A top target is a provi-
sion big banks would rather
retain.
“Orderly liquidation author-
ity,” or OLA, was an answer to
the 2008 bailouts of Wall
Street firms during the finan-
cial crisis. It empowers the fed-
eral government to take over
and wind down a failing finan-
cial firm. Conservatives have
sought for years to repeal OLA.
Now, Trump administration of-
ficials are talking about doing
so, providing new momentum.
OLA is a particularly ripe
target with partisan tensions
boiling on Capitol Hill. That is
the result of quirks in congres-
sional budget rules, which say
that because OLA repeal af-
fects the federal budget, it
could be passed with a simple
majority vote and clear the
Senate with only GOP votes.
In contrast, other Republi-
FINANCE WATCH
ALLIANCEBERNSTEIN
Funds Link Fees
To Performance
AllianceBernstein Holding LP
has filed plans to launch six mu-
tual funds that charge fees only
when they outperform their
benchmark indexes, to compete
with popular lower-cost invest-
ments.
The New York money man-
ager sought regulatory approval
in December to offer its AB Per-
formance Fee Series stock
funds, which charge clients
0.05%-1.05% fees based on their
returns over a year, according to
a filing with the Securities and
Exchange Commission.
The firm also wants to
launch an international bond
fund with fees between
0.1%-0.7%, according to another
filing. Those fees would also
hinge on the fund’s performance.
The average asset-weighted
fee for U.S.-based actively man-
aged funds is 0.75%, according
to Morningstar Inc.’s most recent
estimate. The average asset-
weighted fee for U.S.-based pas-
sive funds is 0.12%.
—Justin Baer
REAL ESTATE
Provider Halts China
Property Barometer
A private-sector data provider
has stopped publishing a widely
watched barometer of China’s
property market that was one of
the few alternatives to an official
gauge, leaving a hole in a gov-
ernment-dominated flow of in-
formation on the economy.
Beijing-based Fang Holdings
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Frank, such as stripping the
government of powers to ex-
tend more stringent oversight
to big nonbank firms, require
some Democratic support to
clear a higher vote hurdle.
Killing OLA has also been
scored as creating $15.2 billion
in budget savings over 10
years, according to the Con-
gressional Budget Office, about
the price tag of other priori-
ties, such as President Donald
Trump’s planned border wall
with Mexico.
“We are going to probably
at some point talk about
whether OLA works and
whether OLA should ever be
triggered, because no one
thinks that we really solved
‘too big to fail,’ ” White House
National Economic Council Di-
rector Gary Cohn said in a
Wall Street Journal interview,
referring to the crisis-era con-
clusions that banks had to be
bailed out. He said the admin-
istration is contemplating an
unspecified executive action
related to the policy.
Steven Mnuchin, who was
Ltd., China’s largest online real-
estate portal, has since at least
2010 published its compilation of
home prices in 100 Chinese cit-
ies into a monthly index. The in-
dex usually shows sharper in-
creases in China’s runaway
property prices than the official
index.
Fang decided to stop updating
the index online to avoid disrupt-
ing the property market, Vincent
Mo, Fang’s chairman and chief
executive, told The Wall Street
Journal.
—Dominique Fong
HEDGE FUNDS
Appaloosa Adds
To Drug Holdings
Hedge-fund manager David
Tepper ramped up some bets on
pharmaceutical companies in the
fourth quarter, while dialing back
his exposure to technology dar-
ling Apple Inc.
Mr. Tepper’s Appaloosa Man-
agement bought new stakes in
Pfizer Inc. and Mylan NV while
more-than doubling his holdings
in merger favorite Allergan PLC.
President Donald Trump’s ad-
ministration may bring a
changed environment for drug
companies, which look to benefit
from a favorable regulatory atti-
tude toward tie-ups while navi-
gating a potential rollback of the
Affordable Care Act.
In selling off his Apple stake,
Mr. Tepper would have missed
out on the technology’s giant’s
record closing level, reached
Monday, on the hope of renewed
momentum for the next iPhone.
An Appaloosa spokesman de-
clined to comment.
—Rob Copeland
BUSINESS OPPORTUNITY
rule is too costly and burden-
products manufacturer seeking a working
The fight over the rule
Minimum investment requirement $250k
with potential to buyout existing partner.
BANKING & FINANCE
Savings Bonus
Eliminating a Dodd-Frank
plank* could save billions,
by one estimate.
Net decrease in the deficit
$2.5 billion
2.0
1.5
1.0
0.5
0
2017 ’18 ’20 ’22
*Orderly liquidation authority
Source: Congressional Budget Office
THE WALL STREET JOURNAL.
confirmed as Treasury secre-
tary Monday, told lawmakers
at a Jan. 19 hearing that “I
think if we have proper regula-
tion, a lot of the need for Title
II also goes away,” a reference
to the portion of the law that
lays out OLA.
Many in the financial indus-
try disagree, especially big
President George W. Bush signing the Sarbanes-Oxley Act in 2002. A fight has simmered over it.
Firms Seek Softer Audit Rule
BY MICHAEL RAPOPORT
President Donald Trump
wants to dismantle the Dodd-
Frank regulatory overhaul.
Many companies don’t want
him to stop there. They are
targeting a long-contested
provision of the Sarbanes-Ox-
ley Act, passed in the wake of
the dot.com bust.
Business groups want to
soften a Sarbanes-Oxley rule
that requires companies to
have auditors weigh in on
their “internal controls,” the
policies and procedures in-
tended to prevent errors or
fraud on financial statements.
Sarbanes-Oxley, passed by
Congress in 2002, requires
companies to evalu-
ate whether these controls
are effective and to have
their auditor pass judgment
on that assessment. Share-
holder advocates say the rule,
known as Section 404(b),
helps ensure companies are
giving accurate numbers to
investors. Groups like the U.S.
some for small companies.
sense of accountability that
has been simmering for years,
but both sides say President
banks that fear an OLA re-
placement would be more dra-
conian regulation, both in the
U.S. and in other countries
where officials view OLA as an
important backstop.
The Clearing House Associ-
ation of large banks said OLA
is a low-cost “Plan B” now that
banks are better prepared for
bankruptcy than before the fi-
nancial crisis, citing “living
will” bankruptcy plans that
banks such as J.P. Morgan
Chase & Co. and Wells Fargo &
Co. have been working on for
years.
The debate over OLA boils
down to a fight over how to
’24 ’26
handle financial crises. Should
huge firms fail no matter the
cost or should the government
have authority to step in if it
believes the economy is at
risk?
Under Dodd-Frank, bank-
ruptcy remains the first op-
tion. Huge banks now write
detailed bankruptcy contin-
gency plans. But if the collapse
of a systemically important
firm might create Lehman
Brothers-like chaos, the Fed-
Under Control
Sarbanes-Oxley’s internal-controls rule initially prompted more companies
to restate their financial statements. Those have since subsided.
NUMBER OF COMPANIES REPORTING RESTATEMENTS
2,000 companies
2005
Most larger
1,500
companies begin
adopting internal-
controls rule
1,000
500
0
2001 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 ’15
Source: Audit Analytics
low at the Competitive Enter-
prise Institute who is among
those pushing to revamp the
rule. “I think with the general
sort of regulatory skepticism
that goes along with the new
administration, you’re seeing
more of a direct focus on
404.”
The rule’s supporters are by exempting even more com-
girding to defend it. For com-
panies, “it creates a greater
sions of this legislation.
shouldn’t go away,” said San-
dra Peters, head of financial-
* *** THE WALL STREET JOURNAL.
eral Deposit Insurance Corp.
has the authority to take over
the firm and wait for market
calm before selling it.
The FDIC may borrow
money from the Treasury to
keep the firms’ lights on—a
backup plan to prevent panic
that would ensue if a huge fi-
nancial firm suddenly didn’t
open for business. These loans
can be recouped by taxing the
financial industry later—a
point that Democrats often
raise to make the case that re-
pealing OLA wouldn’t save any
money.
OLA supporters say the
temporary loans aren't a bail-
out. The failing firm’s share-
holders would be wiped out,
management would be fired
and lenders to the failing com-
pany would lose money, they
say.
But conservatives say the
temporary loans are a bailout.
In their view, the taxpayer
funds would go to some of the
firm’s creditors, creating the
perception of a safety net that
will encourage financiers to
take excessive risks.
DOUG MILLS/ASSOCIATED PRESS
THE WALL STREET JOURNAL.
vestors.
Change may be rapidly ar-
riving: A coming version of
the Financial Choice Act, Re-
publicans’ proposed replace-
ment for Dodd-Frank—put in
place after the financial cri-
sis—would apparently relax
the Sarbanes-Oxley provision
agement back office—compli-
panies from it than had been
planned under previous ver-
builds out its own investing
The most recent version of
the legislation called for rais-
Higher
Reserves
BY LESLIE SCISM
American International
Group Inc. posted a $5.6 bil-
lion pretax charge to boost its
claims reserves, larger than
expected and leading to one
of the company’s worst quar-
terly results since the finan-
cial crisis.
Even as AIG posted a $3.04
billion net loss, or $2.96 a
share, its board announced a
$3.5 billion additional share-
buyback program, testimony
to strong results in many
other parts of the company.
Operating profit for its con-
sumer-insurance businesses
jumped 56% to $969 million.
The additional share repur-
chasing keeps AIG on track to
return at least $25 billion in
capital to its shareholders in
2016 and 2017.
AIG set up the aggressive
capital-return program as a
centerpiece of an effort to im-
prove results amid pressure
from billionaire investors Carl
Icahn and John Paulson to
break up. Mr. Paulson and a
lieutenant for Mr. Icahn now
sit on AIG’s board.
AIG alerted investors to a
material fourth-quarter
charge in announcing a rein-
surance agreement last
month, with Warren Buffett’s
Berkshire Hathaway Inc.,
without disclosing the dollar
amount. Under the pact, one
of the largest ever of its kind,
AIG is paying Berkshire
roughly $10 billion. Most of
the cost of AIG’s reserve
charge will be covered under
the agreement.
At $5.6 billion, the reserve
boost was far larger than es-
timated by Wall Street ana-
lysts.
It comes after a $3.6 bil-
lion before-tax reserve boost
in the year-earlier quarter
that some thought had
brought the reserves to an
ample level.
The large size of this new
charge may shake the confi-
dence of some investors and
sets the stage for analysts to
grill the company in its
Wednesday earnings call.
Peter Hancock, AIG’s chief
executive officer, said in the
earnings release that the
company had “responded de-
finitively to emerging sever-
ity trends that we believe are
materially impacting the
overall U.S. casualty market.”
DEAL
Continued from page B1
charge higher fees and typically
require long-term investments
from backers. Revenue at tradi-
tional money-management
firms has been squeezed in re-
cent years by the growing pop-
ularity of low-cost index-track-
ing funds and a difficult
environment for stock pickers.
SoftBank gains a global net-
work of investors that could
help it find and structure deals.
It also picks up an asset-man-
ance, legal and other func-
tions—that could help as it
business.
SoftBank believes it can dou-

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THE WALL STREET JOURNAL. Wednesday, February 15, 2017 | B7

NEW OPPORTUNITIES AND RISKS

MAY 2, 2017 | WASHINGTON, D.C.

This spring, The Wall Street Journal will bring together leading figures in business, finance and government to discuss
the opportunities and risks shaping the future of America’s middle market—the engine of U.S. growth, job creation and
competitiveness. The Journal’s senior editors will lead dynamic discussions with experts on top business issues, and
explore how the legislative, regulatory and trade policies of the new administration and Congress will impact the sector.

SPEAKERS
J.W. MARRIOTT, JR. MIKE FOLEY
EXECUTIVE CHAIRMAN AND CEO
CHAIRMAN OF THE BOARD ZURICH NORTH AMERICA
MARRIOTT INTERNATIONAL, INC.

TOM RICE KYRSTEN SINEMA

U.S. REPRESENTATIVE (R., S.C.); CO-CHAIR, U.S. REPRESENTATIVE (D., ARIZ.);
CONGRESSIONAL CAUCUS FOR MIDDLE CO-CHAIR, CONGRESSIONAL CAUCUS
MARKET GROWTH FOR MIDDLE MARKET GROWTH

DAVID M. BRACKETT PHIL SEEFRIED

MANAGING PARTNER AND CO-CEO FOUNDER AND CEO
ANTARES CAPITAL HEADWATERS MB

SUSAN C. SCHWAB MARCO ANNUNZIATA

U.S. TRADE REPRESENTATIVE (2006–09) CHIEF ECONOMIST AND EXECUTIVE
PROFESSOR, UNIVERSITY OF MARYLAND DIRECTOR OF GLOBAL MARKET INSIGHT
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DREW ALTMAN RICHARD EDELMAN

PRESIDENT AND CEO PRESIDENT AND CEO
HENRY J. KAISER FAMILY FOUNDATION EDELMAN

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B8 | Wednesday, February 15, 2017 * *** THE WALL STREET JOURNAL.

THE PROPERTY REPORT

Tenants Stymie Mall Makeovers
Department stores to comment.
Lord & Taylor sued White
exercise right to block Flint Mall LLLP in 2013 to stop
owners’ ability to the Maryland mall’s demolition
to make way for offices, resi-
make modifications dential properties and a hotel
it claimed violated an agree-

TH REAL ESTATE
BY SUZANNE KAPNER ment signed in 1975 that pre-
vents the landlord from mak-
As mall owners scramble to ing changes to the property

PATRICK SEMANSKY/ASSOCIATED PRESS

redevelop aging properties, without its consent. The mall
they are being hamstrung by has since been demolished. CC Land’s One Kingdom Street
arcane agreements signed de- In its complaint, Lord &
cades ago with department
stores that govern how the
centers are used, right down to
Taylor accused White Flint of
forcing out tenants to pave the
way for redevelopment. It also
Chinese
the number of parking spaces.
The contracts require an-
chor stores to get permission
argued the new configuration
would have deprived its store
of foot traffic.
Investors
from landlords before chang-
ing the configuration of the
stores, but they also prevent
Lord & Taylor is in litigation with the owner of Maryland’s defunct White Flint Mall, seen in 2014.
“It is a fact that the way
shoppers interact with malls is
changing, and we are commit-
Pile Into
landlords from modifying
malls without the anchors’
consent.
“There is recognition on ev-
eryone’s part that malls need
to adapt,” said William Taub-
rights of mall owners and an-
chors by ensuring each has ad-
equate access to parking and
agreement of every depart-
ment-store anchor.”
After CBL & Associates
ted to being at the forefront of
that evolution,” said Andrew
Blecher, a spokesman for Lord
London’s
Now, some department
stores are exercising their
right to block landlords’ ability
man, chief operating officer of
Taubman Centers Inc., a re-
gional shopping-mall owner.
common areas and that nei-
ther could reconfigure their
space unilaterally. The details
Properties Inc. acquired a
Sears store in the CoolSprings
Galleria in Franklin, Tenn., in
& Taylor parent Hudson’s Bay
Co. He added, however, that
the changes to White Flint
Market
to carry out modifications. “But [landlords] don’t neces- often go right down to the 2013, it wanted to carve the would have created “an unac- BY ART PATNAUDE
While compromises are usually sarily have the same agendas minimum number of parking space into smaller parcels that ceptable experience for our
reached, a handful of cases as the anchors.” spaces, typically about four would house Ulta Beauty Inc. customers.” While commercial real-estate
have landed in court, stymie- Lord & Taylor is embroiled per 1,000 square feet of gross and American Girl stores along Jeffrey Guelcher, the gen- deals in London have declined
ing redevelopment for years. in litigation against the owner leasable space, according to with restaurants. Macy’s Inc., eral counsel to Lerner Corp., since Britain voted to leave the
The legal squabbles come as of a Maryland mall. Sears real-estate executives. which anchors the opposite the managing agent for White European Union, one group of
online shopping is battering Holdings Corp., meanwhile, As shoppers dwindle in end of the mall, agreed, pro- Flint, said in an interview the investors has become increas-
traditional department stores sued the owner of the Gardens malls, such stipulations have viding CBL added new restau- mall was “dying due to a vari- ingly active: the Chinese.
and apparel retailers, and forc- Mall in Palm Beach Gardens, led to “enormous unused park- rants near its store. ety of factors beyond White Investors from China and
ing many of the country’s 1,100 Fla., for attempting to block ing fields that have substantial “Department stores want to Flint’s control,” including the Hong Kong bought more than
malls to reinvent themselves. the retailer from subleasing value for other uses,” said Gar make sure we don’t do any- decision by Bloomingdale’s, £3 billion ($3.75 billion) of
Green Street Advisors, a real- space in its store to Dick’s Herring, chief executive of the thing that will impact them in the other anchor, to close its central London real estate in
estate research firm, expects Sporting Goods Inc. The litiga- MGHerring Group, a regional a negative way,” said Stephen store in 2012. 2016, less than U.K. investors
several hundred low-quality tion is continuing. mall developer. “But if you Lebovitz, CBL’s chief executive, A jury awarded Lord & Tay- but more than those from the
malls to either close or be- The contracts, known as re- want to put a snow cone shack adding that he finds most of lor $31 million in damages in U.S. or Europe, according to
come irrelevant over the next ciprocal easement agreements, in a parking space furthest the requests reasonable. A 2015. Both sides have appealed real-estate broker JLL.
decade. were designed to protect the from the mall, you need the Macy’s spokeswoman declined and are awaiting a ruling. While the yuan has lost
value against the dollar in re-
cent months, it has appreciated

Firm Sees Opportunity in Slumping Sector

BY ESTHER FUNG are putting pressure on retail
tenants, forcing many of them
The next “big short” oppor- to downsize their bricks-and-
tunity is in the debt of dying mortar presence, which in
shopping malls, according to turn hurts mall landlords.
one New York hedge fund. The report’s conclusion:
Alder Hill Management LP “We believe this opportunity,
on Jan. 30 issued a report to created by the ongoing retail
its investors making the case upheaval and the power of
against commercial mortgage- structured leverage, to be
backed securities, or CMBS, among the most asymmetric
tied to retail property, saying our team has ever seen.”
by 12% versus the British
pound since last June’s referen-
dum vote, making assets there
a bargain for Chinese investors.
At the same time, the hunt for
come ‘dead malls’ over the for several years,” said yield, as well as economic and
Waning Confidence next several years and default Moody’s Managing Director political pressures at home, are
Prices of mall-backed debt have either prior to maturity or at Mike Gerdes. helping to drive the acquisition
slumped lately. the 2022 maturity wall,” Alder In recent years, some spree, analysts said.
$100 per swap Hill Management said in the bankers on Wall Street have Deals have continued into
report. been predicting that inves- this year. CC Land Holdings,
CMBX 6 BBB- The report has placed tors who financed the build- backed by Hong Kong property
95 downward pressure on prices. ing of malls would lose bil- tycoon Cheung Chung Kiu, re-
Since Jan. 30, the prices of lions as the situation of mall cently bought an office building
CMBX Series 6 BBB-minus and oversupply is exacerbated by in Paddington for £292 million
90 BB rated securities dropped store closures and competi-
about $5 apiece to $90.24 and tion from e-commerce.

12%
it expects more defaults to oc- Alder Hill said in the report $82.24, respectively, though Still, some investors remain
cur in lower-quality malls dur- it recently placed a short posi- 85 they rebounded slightly late skeptical that loan defaults
ing the wave of retail closures, tion—a wager that an asset’s last week, according to data may happen earlier than ex-
including department stores. value would fall—betting cer- CMBX 6 BB from securities-data tracker pected.
“We expect 2017 to be a tain low-rated securities would 80 Markit, which publishes the Last week, Deutsche Bank The Chinese yuan’s rise against
tipping point for the pace of suffer a loss of 30% to 70%. Jan. Feb. CMBX index. AG analysts recommended the pound since June referendum
retail store closures and rent One way to short these Source: Markit The problems facing malls shorting risky slices of debt
reductions,” said the report, commercial mortgage-backed THE WALL STREET JOURNAL. are a symptom of a weak envi- tied to malls, noting there had
reviewed by The Wall Street securities is through the ronment for retailers. In Janu- been some hesitation to make
Journal. CMBX, a little-known credit- being a “toxic cocktail” of de- ary, Sears Holdings Corp. said such a recommendation earlier. from TH Real Estate, a London-
The report said the fund’s default-swap index that tracks teriorating fundamentals, add- it would close 150 stores, They pointed to lackluster based investment manager
researchers visited malls and the values of bonds backed by ing that investors don’t appre- while Macy’s Inc. gave more retail sales over the holidays owned by investment-manage-
created their model based on mortgages on malls, office ciate the risks posed by mall details of a plan to close 100 and said the risk of a more ment firm Nuveen, the group
individual properties. They buildings and other commer- loans. stores, weakening sentiment rapid contagion from retailer said.
found a pattern in which rap- cial property. Alder Hill de- “High-risk loans are loans among mall investors. bankruptcies and stores clo- A subsidiary of Hong Kong
idly changing consumer tastes scribed a portion of the index, backed by malls that we be- “The issues with weak an- sures would lead to a pickup conglomerate Emperor Group
and the growth of e-commerce known as CMBX Series 6, as lieve are highly likely to be- chor tenants have been around in mortgage defaults. in January said it bought a
building with offices and
shops in the hip London

Tech Startups Fuel a Boom in Berlin Office Space neighborhood of Soho for
£260 million.
The influx from China and
Hong Kong stands out because
BY FRIEDRICH GEIGER other overseas real-estate in-
vestors have taken a step back
BERLIN—A booming tech- from London. Commercial
startup scene is fueling a re- real-estate transaction volume
naissance of the German capi- in the U.K. capital was £21.5
tal’s moribund office market. billion last year, down 45%
In a sign of how scarce of- from 2015, according to Real
fice space has become here, Capital Analytics.
rental contracts in attractive Uncertainty over the impact
central locations have been of Brexit and high prices after
auctioned off to aspiring ten- a multiyear property boom
ants—a radical change from have been hurdles too high for
the not-too-distant days when some investors.
developers were falling over But Chinese investors have
themselves to woo tenants. taken a different view. For them,
“I’ve experienced it several “London still proves attractive,”
times recently that there were said Alistair Meadows, head of
six or seven applicants for a U.K. Capital Markets at JLL.
lease,” said Christian Leska, A weakened currency is
head of the Berlin office of re- only a part of the surge in in-
altor Savills PLC. “They had to terest, brokers and analysts
go through an application pro- said. “Pricing considerations
cess during which some of- are far and away more impor-
fered a euro or two more per tant,” said Joe Valente, head
SEAN GALLUP/GETTY IMAGES

square meter.” Applicants also of European real estate at J.P.

had to demonstrate their cred- Morgan Asset Management.
itworthiness, he said. “There has historically been a
Such auctions are just one very weak relationship be-
sign of the dramatic shift un- tween the sterling exchange
der way in Berlin, where ten- rate and the level of activity
ants had long been able to dic- from foreign buyers.”
tate lease terms and command Factory Berlin rents offices to startups and international brands. Berlin’s office vacancy rate has fallen by two-thirds in under a decade. The hunt for yield amid ul-
perks such as subsidies for of- tralow interest rates has
fice moves, hooking up com- Historically high vacancies “In the past, it took two premium office space in Berlin shop in the city. pushed returns on London
puter networks or even rent- used to deter owners of unde- months to find a new office, now approaches the levels of The technology, media and property to near record lows,
free years. veloped plots from building now it often takes six months other European capitals, telecommunications sector ac- causing many investors to
Berlin’s office vacancy rate offices, she said. Many devel- or more to find something though rents in London and counted for 34% of office space balk.
has declined by two-thirds in opers were surprised by the that fits,” said Philipp Hart- Paris are still more than twice leasing in the fourth quarter of The average capitalization
less than 10 years to 2.7%, the surge in demand from rapidly mann, managing partner of as high. last year, up from 20% in 2013, rate—a measure of yield—on
lowest in 17 major European growing local firms and inter- startup incubator Rheingau Rheingau a decade ago paid according to CBRE. offices in London’s West End
cities Savills has analyzed and national companies that set up Founders GmbH. less than €7 per square meter. Although a few midsize was 4.2% at the end of last
less than half that of Paris and branches in Berlin, and have Berlin’s average monthly “Those times are gone,” said towers dot the city, Berlin’s year, on par with the previous
central London. The vacancy struggled to catch up. “It is rent has risen too. It now av- Mr. Hartmann. skyline could surge upward if boom in late 2007, Real Capi-
rate was 4.5% in Berlin in late quite extreme,” she said. erages €15.84 euros ($16.83) Fueling the boom is Berlin’s the glut of offices doesn’t ease tal data show. But in Hong
2014. “The market has Startups that faced a per square meter, up from tech revolution. The number up soon, Ms. Frisch-Baldé said. Kong, the yield on offices was
changed a lot over the past wealth of options less than a about €11 in 2009, according of office employees in the city OVG Real Estate B.V. plans to just 2.6%.
two to three years,” said Aissa- decade ago now must contend to realtor CBRE Group Inc. has risen 24% in the past 10 develop a 140-meter high of- “It’s clear that returns in
tou Frisch-Baldé, team leader with long searches and frus- Rents for premium offices years, according to real estate fice tower in the Mediaspree London are significantly
at realtor Engel & Völkers’ of- tration as they hunt for suit- have jumped 17% in the past consultancy Bulwiengesa AG, area, completion of which is higher,” said Eric Pang, head of
fice-letting business in Berlin. able premises, managers say. year to €27.50. The price of as hundreds of startups set up scheduled for 2020. China desk in London at JLL.
THE WALL STREET JOURNAL. Wednesday, February 15, 2017 | B9

BIGGEST 1,000 STOCKS

Net Net Net Net Net Net Net
How to Read the Stock Tables Footnotes: Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg
The following explanations apply to NYSE, s-New 52-week high. s EastmanChem EMN 80.58 s Marriott
0.52 Invesco IVZ 32.00 0.17 MolsonCoors B TAP 99.50 3.29 RiteAid RAD 5.72 0.02 TurquoiseHill TRQ 3.59 -0.02 ArchCapital ACGL 93.00 -0.21 MAR 87.89 0.51
NYSE Arca, NYSE MKT and Nasdaq Stock t-New 52-week low. ETN 72.01 -0.19 IEX 91.44 -0.52 RobertHalf RHI 47.47 -0.04 TWTR 16.52 0.71 TEAM 28.96 0.04 MarvellTech MRVL 15.58 -0.10
Eaton IDEX Monsanto MON 107.63 -0.04 Twitter Atlassian
Market listed securities. Prices are composite dd-Indicates loss in the most recent Ecolab ECL 122.84 1.08 IllinoisToolWks ITW 129.60 0.23 Moody's MCO 109.26 0.23 Rockwell ROK 152.21 0.20 TylerTech TYL 155.58 -0.24 Autodesk ADSK 84.54 0.26 Mattel MAT 25.69 0.16
quotations that include primary market trades four quarters. Ecopetrol EC 9.51 -0.05 Infosys INFY 14.91 0.26 s MorganStanley MS 46.04 0.78 RockwellCollins COL 92.61 0.66 TysonFoods TSN 65.00 -0.30 ADP ADP 99.44 0.86 MaximIntProducts MXIM 44.63 -0.40
as well as trades reported by Nasdaq OMX FD-First day of trading. EdisonInt EIX 75.39 -0.17 Ingersoll-Rand IR 81.67 -0.31 Mosaic MOS 34.02 0.27 RogersComm B RCI 42.91 -0.04 UBS Group UBS 15.88 0.04 s B/EAerospace BEAV 62.10 0.13 MelcoCrownEnt MPEL 17.53 0.06
BXSM (formerly Boston), Chicago Stock h-Does not meet continued listing EdwardsLife EW 89.49 -0.47 Ingredion INGR 120.50 0.37 MotorolaSolutions MSI 78.68 0.20 Rollins ROL 36.56 -0.18 UDR UDR 35.36 0.05 BOK Fin BOKF 84.46 1.02 s MercadoLibre MELI 197.07 1.95
Exchange, CBOE, National Stock Exchange, ISE standards s EmersonElectric EMR 64.14 -0.01 ICE ICE 58.65 -0.38 NCR NCR 46.34 0.83 RoperTech ROP 205.37 -0.37 UGI UGI 47.30 -0.52 Baidu BIDU 182.77 -1.54 MicrochipTech MCHP 70.78 0.12
and BATS. lf-Late filing EnbridgeEnPtrs EEP 18.28 ... InterContinentl IHG 47.88 -0.01 NTTDoCoMo DCM 23.53 -0.41 s RoyalBkCanada RY 74.58 0.30 US Foods USFD 27.19 -0.31 BankofOzarks OZRK 55.89 0.36 MicronTech MU 23.12 -0.78
The list comprises the 1,000 largest q-Temporary exemption from Nasdaq Enbridge ENB 43.25 0.07 s IBM IBM 180.13 0.77 NVR NVR 1884.31-20.07 RoyalBkScotland RBS 6.05 0.14 UltraparPart UGP 21.62 0.08 BedBath BBBY 41.02 0.86 Microsemi MSCC 53.32 0.09
companies based on market capitalization. requirements. Encana ECA 12.86 0.20 IntlFlavors IFF 117.90 -2.13 NationalGrid NGG 59.75 -0.14 s RoyalCaribbean RCL 96.52 0.02 UnderArmour A UAA 21.76 0.44 Biogen BIIB 285.14 6.23 Microsoft MSFT 64.57 0.24
Underlined quotations are those stocks with t-NYSE bankruptcy Endurance ENH 92.75 ... IntlGameTech IGT 27.00 -0.33 NatlOilwell NOV 40.66 1.06 RoyalDutchA RDS/A 54.45 0.01 UnderArmour C UA 19.41 0.76 BioMarinPharm BMRN 91.19 0.30 Middleby MIDD 137.33 0.25
large changes in volume compared with the v-Trading halted on primary market. EnelAmericas ENIA 9.77 -0.01 IntlPaper IP 52.88 0.20 NatlRetailProp NNN 44.31 -0.11 RoyalDutchB RDS/B 57.96 0.04 Unilever UN 41.28 -0.05 BlackBerry BBRY 7.35 -0.04 Mondelez MDLZ 44.99 -0.04
issue’s average trading volume. vj-In bankruptcy or receivership or EnelGenChile EOCC 20.33 0.41 Interpublic IPG 24.51 -0.23 NewOrientalEduc EDU 49.73 -1.56 SAP SAP 92.47 -0.06 Unilever UL 41.67 -0.16 Broadcom AVGO 205.33 -1.38 MonsterBeverage MNST 43.38 -0.04
Boldfaced quotations highlight those issues being reorganized under the Energen EGN 56.82 0.72 InvitationHomes INVH 21.03 0.03 NY CmntyBcp NYCB 15.30 0.20 S&P Global SPGI 126.92 0.39 UnionPacific UNP 109.16 0.84 CA CA 31.67 0.08 Mylan MYL 40.75 0.97
whose price changed by 5% or more if their Bankruptcy Code, or securities EnergyTrfrEquity ETE 19.38 0.80 IronMountain IRM 37.05 -0.57 NewellBrands NWL 47.53 0.47 SINOPECShanghai SHI 60.40 -1.92 UnitedContinental UAL 73.74 -0.10 CBOE Holdings CBOE 79.62 0.52 NXP Semi NXPI 102.28 0.02
previous closing price was $2 or higher. assumed by such companies. EnergyTrfrPtrs ETP 39.53 1.12 IsraelChemicals ICL 4.65 -0.08 NewfieldExpln NFX 43.67 1.67 SK Telecom SKM 22.28 0.10 UPS B UPS 108.99 0.49 s CDK Global CDK 65.88 0.32 Nasdaq NDAQ 70.78 0.08
Enerplus ERF 9.61 0.23 ItauUnibanco ITUB 12.92 0.14 NewmontMining NEM 37.09 -0.29 SLGreenRealty SLG 111.04 0.73 UnitedRentals URI 128.79 1.01 s CDW CDW 59.38 0.12 s NetApp NTAP 39.52 -0.06
EnLinkMidPtrs ENLK 19.16 0.09 s JPMorganChase JPM 89.56 1.41 NextEraEnergy NEE 126.00 ... Salesforce.com CRM 80.92 0.01 s US Bancorp USB 54.55 0.42 CH Robinson CHRW 77.20 0.22 Netease NTES 256.12 -4.66
Wall Street Journal stock tables reflect composite regular trading as of 4 p.m. and Entergy ETR 70.79 -1.17 JacobsEngineering JEC 57.53 0.08 NielsenHoldings NLSN 44.77 -0.21 Sanofi SNY 42.76 0.22 US Steel X 39.28 -0.43 CME Group CME 121.01 -0.37 Netflix NFLX 140.82 -2.38
changes in the closing prices from 4 p.m. the previous day. EnterpriseProd EPD 28.90 0.14 JamesHardie JHX 14.70 -0.03 Nike NKE 56.45 0.36 Sasol SSL 29.17 0.16 UnitedTech UTX 111.57 -0.45 CSX CSX 48.00 0.09 NewsCorp A NWSA 13.08 ...
EnvisionHlthcr EVHC 68.09 0.44 J&J JNJ 116.36 0.48 NipponTelegraph NTT 42.01 -0.94 Scana SCG 66.86 -3.17 UnitedHealth UNH 163.13 1.14 s CadenceDesign CDNS 29.92 0.10 NewsCorp B NWS 13.35 ...
Net Net Equifax EFX 130.32 0.20 JohnsonControls JCI 41.49 -0.26 NiSource NI 22.25 -0.27 Schlumberger SLB 82.46 0.64 UniversalHealthB UHS 121.30 3.42 Celgene CELG 117.02 0.60 Nordson NDSN 116.52 -0.61
Tuesday, February 14, 2017 s UnumGroup UNM 48.50 0.29 NorthernTrust NTRS 87.58 1.30
Stock Sym Close Chg Stock Sym Close Chg EquityLife ELS 75.66 -0.20 JoyGlobal JOY 28.11 -0.03 NobleEnergy NBL 37.65 -0.81 SchwabC SCHW 41.26 0.54 Cerner CERN 54.55 2.03
Net EquityResdntl EQR 62.00 -0.14 JuniperNetworks JNPR 27.88 -0.05 Nokia NOK 4.97 0.01 ScottsMiracleGro SMG 93.45 1.58 VEREIT VER 8.70 -0.09 CharterComms CHTR 322.00 -1.02 NorwegianCruise NCLH 47.77 -0.10
Stock Sym Close Chg Avangrid AGR 40.36 -0.12 Cencosud CNCO 9.15 -0.03 EssexProp ESS 226.02 -0.69 s KAR Auction KAR 46.42 0.08 NomuraHoldings NMR 6.67 -0.09 SealedAir SEE 47.12 0.13 VF VFC 50.87 0.48 CheckPointSftw CHKP 100.97 0.03 NVIDIA NVDA 108.78 0.40
AveryDennison AVY 79.29 -0.16 CenovusEnergy CVE 13.73 0.28 EsteeLauder EL 83.25 0.66 KB Fin KB 41.80 0.20 Nordstrom JWN 45.44 1.08 SemicondctrMfg SMI 7.20 -0.20 s Visa V 86.85 0.41 CincinnatiFin CINF 72.39 0.64 OReillyAuto ORLY 269.52 1.04
NYSE Avnet AVT 46.66 -0.08 Centene CNC 70.93 1.00 s EverestRe RE 233.57 0.49 KKR KKR 18.01 0.01 NorfolkSouthern NSC 122.49 0.28 SempraEnergy SRE 104.33 -0.83 VailResorts MTN 178.01 0.64 Cintas CTAS 117.02 0.03 OldDomFreight ODFL 91.85 -0.74
AxaltaCoating AXTA 29.66 0.01 CenterPointEner CNP 26.05 -0.35 EversourceEner ES 55.95 -0.54 KT KT 15.50 0.10 NorthropGrumman NOC 239.62 0.54 SensataTech ST 42.01 -0.10 Vale VALE 11.16 -0.18 s CiscoSystems CSCO 32.31 0.34 ON Semi ON 15.31 0.37
ABB ABB 22.82 -0.12 s BB&T BBT 47.87 0.89 CentraisElBras EBR 7.20 0.02 Exelon EXC 35.36 0.26 KSCitySouthern KSU 86.42 -0.25 Novartis NVS 75.16 -0.27 s ServiceCorp SCI 31.75 2.20 ValeantPharm VRX 15.98 1.01 CitrixSystems CTXS 78.93 0.15 OpenText OTEX 33.78 0.11
AECOM ACM 38.34 0.43 BCE BCE 44.40 -0.07 CenturyLink CTL 24.54 -0.08 ExtraSpaceSt EXR 73.50 -1.35 Kellogg K 75.92 0.30 NovoNordisk NVO 34.55 -0.04 s ServiceNow NOW 92.89 1.15 ValeroEnergy VLO 67.62 0.58 Cognex CGNX 69.67 -0.34 PTC PTC 54.46 0.16
AES AES 11.49 -0.19 BHPBilliton BHP 40.47 0.04 Chemours CC 32.07 -0.07 ExxonMobil XOM 82.82 -0.18 s KeyCorp KEY 18.87 0.41 Nucor NUE 63.09 -0.50 ShawComm B SJR 21.47 0.07 Valspar VAL 110.67 -0.04 CognizantTech CTSH 57.36 -0.28 s Paccar PCAR 70.07 0.20
Aflac AFL 71.04 0.06 BHPBilliton BBL 35.18 0.19 ChesapeakeEner CHK 6.44 0.11 FMC FMC 58.06 -0.69 KeysightTechs KEYS 37.45 0.03 NuSTAREnergy NS 54.29 -0.06 SherwinWilliams SHW 309.90 0.28 Vantiv VNTV 64.21 0.45 Comcast A CMCSA 76.09 0.38 PacWestBancorp PACW 56.62 0.98
AT&T T 40.75 0.10 BP BP 34.58 -0.08 Chevron CVX 112.52 -0.31 FactSet FDS 178.77 0.15 KilroyRealty KRC 74.71 0.27 OGE Energy OGE 34.31 -0.23 s ShinhanFin SHG 41.23 0.17 VarianMed VAR 80.60 0.43 CommerceBcshrs CBSH 58.14 0.99 PaneraBread PNRA 233.05 0.59
AXIS Capital AXS 67.73 -0.10 BRF BRFS 14.06 0.31 ChinaEastrnAir CEA 26.94 -0.12 FederalRealty FRT 141.08 -1.87 KimberlyClark KMB 122.88 -0.55 ONEOK OKE 54.95 -0.07 Shopify SHOP 56.05 ... Vedanta VEDL 14.91 -0.48 s CommScope COMM 38.86 0.11 Paychex PAYX 59.27 0.23
AbbottLabs ABT 43.65 0.43 BT Group BT 19.30 0.01 ChinaLifeIns LFC 15.77 0.01 FedEx FDX 192.46 -0.11 KimcoRealty KIM 24.68 -0.23 ONEOK Partners OKS 53.25 -0.06 SilverWheaton SLW 22.23 0.04 VeevaSystems VEEV 43.98 -0.04 Copart CPRT 58.60 -0.10 PayPal PYPL 41.62 0.45
AbbVie ABBV 60.82 0.31 BakerHughes BHI 61.50 0.44 ChinaMobile CHL 56.80 -0.59 s FiatChrysler FCAU 11.42 0.48 KinderMorgan KMI 22.54 -0.01 OccidentalPetrol OXY 67.16 -0.23 SimonProperty SPG 180.94 -0.73 Ventas VTR 61.64 -1.16 CoStarGroup CSGP 205.31 -0.33 People'sUtdFin PBCT 19.11 0.25
Accenture ACN 120.00 1.41 Ball BLL 73.74 -0.11 ChinaPetrol SNP 79.50 -0.63 FidelityNatlFin FNF 37.37 0.04 KinrossGold KGC 3.93 -0.05 Och-Ziff OZM 3.63 0.04 SixFlags SIX 60.91 0.62 Verizon VZ 48.27 -0.28 s Costco COST 173.63 1.67 Priceline PCLN 1637.29 -8.89
AcuityBrands AYI 211.95 -2.60 BancoBilbaoViz BBVA 6.63 0.18 ChinaSoAirlines ZNH 30.72 0.28 FNFV Group FNFV 12.80 0.25 Kohl's KSS 42.64 1.30 OldRepublic ORI 20.78 0.01 SmithAO AOS 49.67 -0.28 VermilionEnergy VET 40.43 0.04 Ctrip.com CTRP 45.07 0.12 Qiagen QGEN 29.03 -0.09
Adient ADNT 62.09 0.95 BancodeChile BCH 72.27 0.49 ChinaTelecom CHA 48.89 -0.21 FidelityNtlInfo FIS 80.50 -0.41 KoninklijkePhil PHG 29.09 -0.18 OmegaHealthcare OHI 31.28 -0.53 Smith&Nephew SNN 30.36 0.09 Vipshop VIPS 12.43 0.14 DISH Network DISH 61.95 ... Qorvo QRVO 66.44 -0.09
AdvanceAuto AAP 164.37 1.98 BcoSantChile BSAC 21.83 -0.21 ChinaUnicom CHU 12.12 -0.14 FirstData FDC 16.25 0.11 KoreaElcPwr KEP 17.86 -0.04 Omnicom OMC 85.03 -0.90 Smucker SJM 137.93 -0.86 s VMware VMW 90.62 0.25 DentsplySirona XRAY 59.74 0.90 Qualcomm QCOM 55.48 0.55
AdvSemiEngg ASX 6.04 -0.03 BancoSantander SAN 5.46 0.07 Chipotle CMG 419.54 5.40 FirstRepBank FRC 96.42 0.04 Kroger KR 33.07 -0.14 Oracle ORCL 41.10 0.01 SnapOn SNA 172.92 1.06 s VornadoRealty VNO 109.03 2.58 DexCom DXCM 81.06 0.84 RandgoldRscs GOLD 93.00 0.19
Aegon AEG 5.63 0.05 BanColombia CIB 37.55 -0.40 s Chubb CB 133.99 0.18 FirstEnergy FE 30.36 -0.17 Kyocera KYO 54.96 -0.32 Orange ORAN 15.42 -0.03 SOQUIMICH SQM 34.51 0.46 s VoyaFinancial VOYA 42.00 1.00 DiamondbackEner FANG 107.68 3.38 RegenPharm REGN 376.52 0.86
s AerCap AER 46.80 0.39 s BankofAmerica BAC 24.06 0.66 ChunghwaTelecom CHT 32.49 0.10 FleetCorTech FLT 167.36 -0.89 s LATAMAirlines LFL 10.05 -0.01 Orix IX 76.99 -0.28 SonocoProducts SON 53.29 0.09 VulcanMaterials VMC 122.74 0.28 DiscoveryComm A DISCA 28.53 -0.50 RossStores ROST 68.70 0.65
Aetna AET 125.81 3.76 s BankofMontreal BMO 77.00 -0.03 Church&Dwight CHD 48.53 0.11 Flowserve FLS 50.93 -0.57 L Brands LB 58.14 0.32 OwensCorning OC 57.58 0.07 Sony SNE 31.63 -0.05 WABCO WBC 116.46 0.59 DiscoveryComm C DISCK 27.89 -0.21 Ryanair RYAAY 82.71 -0.51
AffiliatedMgrs AMG 167.68 0.36 BankNY Mellon BK 46.82 0.70 Cigna CI 146.68 0.83 Fluor FLR 57.35 0.42 LGDisplay LPL 12.42 0.21 PG&E PCG 63.32 -0.37 Southern SO 48.59 -0.63 EWEC Energy WEC 57.36 -0.52 DollarTree DLTR 79.80 2.10 s SBA Comm SBAC 108.73 -0.89
AgilentTechs A 50.39 -0.13 s BkNovaScotia BNS 61.76 0.19 CimarexEnergy XEC 136.25 3.52 FomentoEconMex FMX 79.54 0.32 LINE LN 32.02 0.12 PLDT PHI 29.02 -0.75 SoCopper SCCO 38.63 -0.01 W.P.Carey WPC 62.91 -0.92 Dunkin' DNKN 55.41 0.64 SEI Investments SEIC 49.45 -0.09
AgnicoEagle AEM 49.45 -0.30 Barclays BCS 11.75 0.18 Citigroup C 59.83 0.88 FootLocker FL 70.64 0.21 s L3 Tech LLL 165.73 0.26 s PNC Fin PNC 126.10 1.68 SouthwestAirlines LUV 55.31 -0.42 WPX Energy WPX 14.03 0.14 E*TRADE ETFC 36.88 0.72 Sina SINA 76.27 1.43
Agrium AGU 107.24 1.33 Bard CR BCR 240.66 0.07 s CitizensFin CFG 37.98 1.06 FordMotor F 12.65 0.09 LabCpAm LH 135.88 0.95 s POSCO PKX 61.45 0.70 SpectraEnergy SE 42.19 0.09 Wabtec WAB 86.75 -0.91 s EastWestBancorp EWBC 54.10 1.18 SLM SLM 12.45 0.01
AirProducts APD 142.13 1.63 BarrickGold ABX 19.27 -0.15 Clorox CLX 127.40 0.27 ForestCIty A FCE/A 22.98 0.19 LambWeston LW 39.65 0.22 PPG Ind PPG 101.57 0.76 SpectraEnerPtrs SEP 45.50 0.15 Wal-Mart WMT 68.66 0.89 eBay EBAY 33.63 -0.16 SS&C Tech SSNC 32.64 0.08
AlaskaAir ALK 96.30 -1.72 BaxterIntl BAX 48.96 -0.27 Coach COH 38.10 -0.03 ForestCity B FCE/B 29.60 0.10 LasVegasSands LVS 53.06 -0.10 PPL PPL 35.47 -0.26 SpectrumBrands SPB 133.17 -0.01 WasteConnections WCN 80.80 0.19 ElectronicArts EA 86.06 -0.26 s SVB Fin SIVB 185.49 4.93
Albemarle ALB 91.19 -3.56 BectonDickinson BDX 178.77 0.22 Coca-Cola KO 40.53 -0.09 Fortis FTS 32.15 -0.21 Lazard LAZ 43.71 0.31 PVH PVH 90.26 1.33 SpiritAeroSys SPR 57.32 -0.25 WasteMgt WM 70.86 0.02 Equinix EQIX 382.64 -4.05 Sabre SABR 21.90 -0.37
Alcoa AA 38.56 0.08 s Berkley WRB 69.12 0.50 Coca-Cola Euro CCE 35.09 -0.11 Fortive FTV 57.29 -0.24 Lear LEA 144.29 0.50 PackagingCpAm PKG 95.14 0.27 Sprint S 9.07 0.23 Waters WAT 150.47 0.74 Ericsson ERIC 5.78 0.06 ScrippsNetworks SNI 76.90 -0.57
AlexandriaRealEst ARE 114.98 0.72 BerkHathwy A BRK/A 2504192078.95 Coca-Cola Femsa KOF 64.15 0.62 FortBrandsHome FBHS 56.86 -0.22 Leggett&Platt LEG 48.20 -0.48 PaloAltoNtwks PANW 156.91 0.68 StanleyBlackDck SWK 125.79 -0.62 Watsco WSO150.06 -6.36 Exelixis EXEL 22.02 0.72 s Seagate STX 47.85 0.05
Alibaba BABA 101.59 -1.51 BerkHathwy B BRK/B 166.95 1.10 Colgate-Palmolive CL 67.74 0.03 Franco-Nevada FNV 67.97 -0.25 Leidos LDOS 51.06 0.07 ParkHotels PK 27.55 -0.11 StarwoodProp STWD 22.81 -0.04 WeatherfordIntl WFT 6.15 0.07 Expedia EXPE 119.67 0.17 SeattleGenetics SGEN 62.88 1.29
s Alleghany Y 622.32 1.44 BerryPlastics BERY 49.38 0.19 ColonyNorthStar CLNS 14.39 -0.11 FranklinRscs BEN 42.10 0.59 Lennar A LEN 46.21 -0.49 ParkerHannifin PH 152.63 0.17 StateStreet STT 81.45 2.16 WellCareHealth WCG 142.66 -1.10 ExpeditorsIntl EXPD 55.21 0.12 Shire SHPG 172.32 1.77
Allegion ALLE 71.08 -0.37 BestBuy BBY 45.29 1.32 s Comerica CMA 72.03 2.19 Freeport-McMoRan FCX 15.90 -0.06 Lennar B LEN/B 37.33 -0.38 ParsleyEnergy PE 32.45 0.37 Statoil STO 17.85 -0.04 WellsFargo WFC 57.98 0.90 ExpressScripts ESRX 69.63 0.33 SignatureBank SBNY 159.81 2.28
Allergan AGN 248.57 1.81 Bio-RadLab A BIO 191.75 2.58 SABESP SBS 10.77 -0.02 FreseniusMed FMS 40.65 -0.13 LennoxIntl LII 160.16 -0.95 Pearson PSO 8.20 0.08 Steris STE 68.94 1.03 Welltower HCN 65.51 -0.78 F5Networks FFIV 141.10 0.63 SiriusXM SIRI 4.74 -0.02
AllianceData ADS 229.39 1.58 BlackRock BLK 384.98 -0.85 CiaSiderurgica SID 4.05 0.03 GGP GGP 25.03 -0.27 s LeucadiaNatl LUK 24.91 0.63 PembinaPipeline PBA 31.47 0.10 STMicroelec STM 13.78 0.02 WestPharmSvcs WST 86.93 0.51 Facebook FB 133.85 -0.20 Skyworks SWKS 91.80 -0.83
AllianceBernstein AB 24.50 0.75 BlackstoneGroup BX 30.45 ... CSC CSC 70.14 -0.25 s Gallagher AJG 55.56 0.01 Level3Comm LVLT 57.87 -0.14 Pentair PNR 58.62 -0.86 Stryker SYK 125.26 0.93 WestarEnergy WR 53.00 -0.35 Fastenal FAST 50.39 0.26 Splunk SPLK 61.93 -0.15
AlliantEnergy LNT 37.67 -0.32 BoardwalkPipe BWP 18.35 -0.04 ConagraBrands CAG 39.79 0.03 Gap GPS 24.20 0.57 LibertyProperty LPT 38.81 -0.20 PepsiCo PEP 106.92 0.40 SumitomoMits SMFG 8.03 -0.05 s WestAllianceBcp WAL 52.99 2.03 FifthThirdBncp FITB 27.55 0.81 Staples SPLS 9.46 0.26
s AllisonTransm ALSN 38.02 0.16 Boeing BA 168.50 0.47 ConchoRscs CXO 144.26 2.01 Gartner IT 101.25 -0.17 EliLilly LLY 78.81 1.04 PerkinElmer PKI 54.40 0.01 SunCommunities SUI 80.15 -0.50 WesternGasEquity WGP 47.20 -0.03 Fiserv FISV 110.14 0.04 Starbucks SBUX 56.58 0.47
s Allstate ALL 79.80 0.19 BorgWarner BWA 41.50 -0.17 ConocoPhillips COP 50.14 0.44 Gazit-Globe GZT 10.00 -0.04 s LincolnNational LNC 72.13 1.05 Perrigo PRGO 82.13 1.97 SunLifeFinancial SLF 40.00 0.08 s WesternGasPtrs WES 65.83 0.25 s Flex FLEX 16.27 0.15 SteelDynamics STLD 37.81 0.10
s AllyFinancial ALLY 23.32 0.37 BostonProperties BXP 135.79 1.03 ConEd ED 73.69 -0.66 GeneralDynamics GD 187.23 0.63 LionsGate A LGF/A 28.21 -0.27 PetroChina PTR 79.19 -0.13 SuncorEnergy SU 32.01 0.11 WesternUnion WU 19.68 0.15 Fortinet FTNT 37.77 -0.03 Stericycle SRCL 77.56 -0.63
Altria MO 71.88 -0.16 BostonScientific BSX 25.18 -0.12 ConstBrands A STZ 155.89 0.40 GeneralElec GE 30.28 0.24 LiveNationEnt LYV 29.03 0.02 PetroleoBrasil PBR 10.91 0.34 SunocoLogistics SXL 26.61 0.75 WestlakeChem WLK 64.23 -0.20 Gaming&Leisure GLPI 31.51 -0.03 Symantec SYMC 28.68 -0.38
s AlumofChina ACH 13.80 0.36 Braskem BAK 22.00 0.27 ConstBrands B STZ/B 157.21 -0.89 GeneralMills GIS 63.09 0.20 LloydsBanking LYG 3.38 0.01 PetroleoBrasilA PBR/A 10.27 0.26 s SunTrustBanks STI 59.59 1.45 WestpacBanking WBK 25.23 -0.06 Garmin GRMN 50.25 -0.09 Synopsys SNPS 65.84 -0.14
Ambev ABEV 5.60 0.13 Bristol-Myers BMY 53.71 1.68 ContinentalRscs CLR 46.97 0.54 GeneralMotors GM 37.24 1.72 LockheedMartin LMT 262.56 0.21 Pfizer PFE 32.75 0.14 SynchronyFin SYF 37.32 0.67 WestRock WRK 53.52 0.82 Gentex GNTX 20.60 0.03 TD Ameritrade AMTD 42.94 0.21
Ameren AEE 52.65 -0.40 BrixmorProp BRX 23.90 -0.58 s Cooper COO 191.65 0.41 GenuineParts GPC 99.66 -0.23 Loews L 46.96 0.15 PhilipMorris PM 102.58 -0.15 Syngenta SYT 85.76 -0.54 Weyerhaeuser WY 33.29 -0.50 GileadSciences GILD 67.55 -0.10 TESARO TSRO 182.26 -0.09
AmericaMovil AMX 12.99 0.06 BroadridgeFinl BR 67.56 -0.32 s Corning GLW 27.24 0.51 Gerdau GGB 4.23 0.01 Lowe's LOW 75.72 1.82 Phillips66 PSX 79.98 0.08 Sysco SYY 52.73 -0.08 Whirlpool WHR 174.87 -0.55 s Goodyear GT 35.76 0.05 T-MobileUS TMUS 61.60 0.70
AmericaMovil A AMOV 12.80 -0.03 BrookfieldMgt BAM 36.80 -0.02 Coty COTY 19.27 0.90 Gildan GIL 25.13 0.13 Luxottica LUX 53.64 0.34 PinnacleFoods PF 54.66 0.23 TAL Education TAL 85.08 -2.11 WhiteWaveFoods WWAV 54.75 -0.11 s Grifols GRFS 17.47 0.21 TRowePrice TROW 69.86 0.04
AmCampus ACC 49.18 0.10 BrookfieldInfr BIP 36.65 0.17 Credicorp BAP 166.81 -2.71 GlaxoSmithKline GSK 40.11 0.12 LyondellBasell LYB 93.15 0.93 PinnacleWest PNW 78.09 -0.63 TE Connectivity TEL 75.42 -0.02 Williams WMB 28.89 -0.15 HDSupply HDS 43.14 -0.37 TakeTwoSoftware TTWO 58.26 -0.16
AEP 63.27 -0.52 Brown&Brown BRO 43.10 -0.04 CreditSuisse CS 15.06 0.25 s M&T Bank MTB 168.22 1.42 s PioneerNatRscs PXD 198.90 1.86 WilliamsPartners WPZ 40.92 -0.08 HAS 97.80 -0.33
s Tesla TSLA 280.98 0.38
AEP GlobalPayments GPN 79.21 0.99 Telus TU 32.90 -0.06 Hasbro
s AmericanExpress AXP 79.41 0.50 Brown-Forman A BF/A 48.20 0.25 CrescentPoint CPG 11.56 0.06 Goldcorp GG 16.62 -0.14 MGM Resorts MGM 28.65 -0.51 PlainsAllAmPipe PAA 31.42 0.46 Ternium TX 23.72 -0.76
Wipro WIT 9.56 0.11 HenrySchein HSIC 166.65 1.54 TexasInstruments TXN 75.64 0.12
s AmericanFin AFG 92.50 0.58 Brown-Forman B BF/B 47.13 0.26 s GoldmanSachs GS 249.46 s TIM Part s WooriBank WF 36.67 0.65 TractorSupply TSCO 73.40 0.24
CrestwoodEquity CEQP 27.15 0.20 3.19 MPLX MPLX 38.81 0.50 PolarisIndustries PII 87.71 0.45 TSU 15.73 0.42 Hologic HOLX 39.03 -0.99
AmerHomes4Rent AMH 22.91 0.04 Brunswick BC 59.74 -0.49 CrownCastle CCI 90.25 0.03 Grainger GWW 253.75 -0.59 s MSCI MSCI 93.95 1.16 PostHoldings POST 84.51 -0.49 TJX TJX 78.08 1.18
Workday WDAY 86.24 0.83
JBHunt JBHT 99.50 -0.86
Trimble TRMB 31.30 -0.11
AIG 66.89 0.75 BuckeyePtrs BPL 71.96 0.13 s Wyndham WYN 81.80 0.05 TripAdvisor TRIP 52.19 0.80
AIG CrownHoldings CCK 52.93 -0.39 GreatPlainsEner GXP 28.02 0.02 MSC Industrial MSM 104.59 0.25 Potash POT 19.28 0.17 TaiwanSemi TSM 31.33 -0.36 HuntingtonBcshs HBAN 14.12 0.31
AmerTowerREIT AMT 106.78 -0.77 Bunge BG 68.29 0.25 Cullen/Frost CFR 92.63 1.33 GpoAvalAcciones AVAL 8.01 -0.37 Macerich MAC 67.17 -0.53 Praxair PX 117.32 -0.12 TargaResources TRGP 59.30 -0.26
XcelEnergy XEL 41.72 -0.31
IAC/InterActive IAC 76.00 -0.48
21stCenturyFoxA FOXA 30.30 0.58
AmerWaterWorks AWK 72.81 -0.41 BurlingtonStores BURL 86.91 0.89 CMI 151.96 -0.89 MacquarieInfr MIC 78.63 -1.10 s PrincipalFin PFG 62.06 -0.03 TGT 65.65 0.84
Xerox XRX 7.48 0.22
IDXX 141.60 -0.10
21stCenturyFoxB FOX 30.02 0.54
Cummins GpFinSantandMex BSMX 7.31 ... Target IdexxLab
Amerigas APU 48.04 0.03 CBD 18.66 0.22 DDR 14.84 -0.56 32.68 0.10
Xylem XYL 47.65 -0.45
IHSMarkit INFO 39.97 0.04
UltaBeauty ULTA 271.46 3.34
CBD Pao DDR GrupoTelevisa TV 22.83 -0.40 Macy's M Procter&Gamble PG 87.86 -0.45 TataMotors TTM 33.41 -4.01
s Ameriprise AMP 127.81 1.66 s CBRE Group CBG 35.13 0.64 s HCAHoldings HCA 83.71 YPF YPF 21.73 0.14 s IPG Photonics IPGP117.02 0.94
UltimateSoftware ULTI 196.28 2.25
DTE Energy DTE 98.21 0.14 -0.04 MagellanMid MMP 80.36 0.28 Progressive PGR 37.45 -0.15 TeckRscsB TECK 25.09 -0.37
AmerisourceBrgn ABC 90.82 0.34 CBS/A 66.53 0.11 YanzhouCoal YZC 7.71 0.06 UnitedTherap UTHR 165.67 1.19
CBS A Danaher DHR 84.10 -0.09 HCP HCP 30.41 -0.44 MagnaIntl MGA 45.21 0.53 Prologis PLD 49.92 -0.05 TelecomItalia TI 8.53 -0.08 IcahnEnterprises IEP 56.46 -0.38
AME 53.58 -0.09 CBS 65.33 0.03 s PrudentialFin PRU 110.45 0.65 YumBrands YUM 68.58 0.47 VCA WOOF 90.77 -0.02
Ametek CBS B Darden DRI 76.24 0.16 HDFC Bank HDB 71.40 0.11 Manpower MAN 96.45 0.10 TelecomItalia A TI/A 6.91 -0.09 Illumina ILMN 164.46 0.62
Amphenol APH 69.13 0.16 CF Industries CF 36.32 -0.39 s HP YumChina YUMC 26.63 -0.63 s Incyte VeriSign VRSN 82.68 -0.22
DaVita DVA 64.73 -0.08 HPQ 16.06 0.02 ManulifeFin MFC 19.09 0.29 Prudential PUK 40.52 -0.18 Teleflex TFX 176.89 1.09 INCY 123.32 2.17
AnadarkoPetrol APC 68.33 0.19 CGI Group GIB 48.93 -0.05 s HSBCHoldings HSBC 43.51 ZTO Express ZTO 13.08 0.04 VeriskAnalytics VRSK 85.09 0.13
Deere DE 110.05 -0.70 0.23 MarathonOil MRO 16.41 0.35 PublicServiceEnt PEG 43.43 -0.33 TelefonicaBras VIV 15.31 0.13 Intel INTC 35.93 0.13
AngloGoldAsh AU 13.17 -0.01 CIT Group CIT 42.96 0.46 ZayoGroup ZAYO 30.75 -0.34 VertxPharm VRTX 88.91 1.19
DelphiAutomotive DLPH 75.96 -0.04 Halliburton HAL 56.54 0.22 MarathonPetrol MPC 50.96 1.04 PublicStorage PSA 216.90 -3.16 Telefonica TEF 9.70 0.08 Intuit INTU 118.84 0.44
AB InBev BUD 108.44 1.62 CMS Energy CMS 42.78 -0.35 ZimmerBiomet ZBH 117.18 -0.57 Viacom A VIA 47.40 0.80
DeltaAir DAL 49.86 -0.20 Hanesbrands HBI 20.85 0.40 MarineHarvest MHG 18.18 0.05 PulteGroup PHM 21.49 -0.03 TelekmIndonesia TLK 28.67 -0.65 IntuitiveSurgical ISRG 714.92 4.22
AnnalyCap NLY 10.46 -0.12 s CNA Fin CNA 44.33 0.86 Zoetis ZTS 55.02 -0.12 Viacom B VIAB 44.25 0.80
DeutscheBank DB 19.53 0.32 HarleyDavidson HOG 57.74 0.58 Markel MKL 949.78 0.46 QuantaServices PWR 37.39 0.24 Tenaris TS 34.50 0.14 IonisPharma IONS 46.99 0.90
AnteroMidstream AM 35.07 -0.03 s Marsh&McLennan MMC 71.94 VimpelCom VIP 4.39 0.10
CNOOC CEO 124.17 -0.40 DevonEnergy DVN 45.94 0.68 HarmanIntlInds HAR 111.05 0.05 0.46 QuestDiag DGX 94.61 0.65 Teradyne TER 28.95 0.05 JD.com JD 29.43 -0.09
AnteroResources AR 25.56 0.64 s CPFLEnergia CPL 16.45 0.12 Diageo DEO 113.42 -0.70 s Harris HRS 107.94 0.93 MartinMarietta MLM 226.41 -4.98 s QuintilesIMS Q 82.30 2.30 Tesoro TSO 88.01 0.66
NASDAQ JackHenry JKHY 91.05 -0.43
Vodafone VOD 24.88 -0.11
s Anthem ANTM163.32 -0.20 WPP WPPGY 117.64 -1.28
CRH CRH 34.26 -0.52 Dick's DKS 51.75 -0.67 HartfordFinl HIG 48.50 0.45 Masco MAS 33.11 -0.39 RELX RENX 17.34 -0.02 s TesoroLogistics TLLP 59.69 0.61 AGNC Invt AGNC 19.29 -0.11 JazzPharma JAZZ 133.78 1.73
AON 115.85 -0.02
WalgreensBoots WBA 83.79 0.36
Aon CVS Health CVS 78.67 -0.03 DigitalRealty DLR 105.30 -1.94 Helmerich&Payne HP 70.65 1.47 Mastercard MA 108.88 0.60 RELX RELX 18.57 -0.14 TevaPharm TEVA 34.90 0.90 Ansys ANSS 98.36 1.19 JetBlue JBLU 19.66 -0.18
APA 55.50 -1.68
Weibo WB 54.87 0.48
Apache CabotOil COG 24.24 0.29 DiscoverFinSvcs DFS 70.85 1.27 Herbalife HLF 60.15 0.19 McCormick MKC 96.85 -0.43 RPM RPM 52.46 -0.06 Textron TXT 49.20 0.01 ARRIS Intl ARRS 29.87 0.34 KLA Tencor KLAC 86.99 -0.23
WesternDigital WDC 76.41 -2.06
ApartmtInv AIV 45.36 -0.16 CamdenProperty CPT 81.38 -0.29 Disney DIS 110.33 0.68 Hershey HSY 108.34 0.13 McCormickVtg MKC/V 96.72 -0.32 RSP Permian RSPP 43.10 1.46 ThermoFisherSci TMO 157.28 0.93 ASML ASML126.25 -0.25 s KraftHeinz KHC 90.81 0.23
WholeFoods WFM 30.38 0.35
AquaAmerica WTR 29.84 -0.28 Cameco CCJ 12.36 0.63 DollarGeneral DG 77.14 1.12 Hess HES 52.00 0.12 McDonalds MCD 125.81 0.27 RalphLauren RL 79.49 0.15 ThomsonReuters TRI 44.86 0.03 ActivisionBliz ATVI 44.98 -0.72 LKQ LKQ 31.66 0.31 WillisTwrsWatson WLTW 125.17 0.03
Aramark ARMK 35.64 0.35 CampbellSoup CPB 63.03 -0.40 DominionRscs D 73.12 -0.61 HewlettPackard HPE 24.14 0.02 McKesson MCK 145.20 4.71 RangeResources RRC 32.81 0.28 ThorIndustries THO 109.78 0.92 AdobeSystems ADBE 117.58 -0.07 LamResearch LRCX 115.63 -0.63 WynnResorts WYNN 97.68 -1.29
ArcelorMittal MT 9.16 -0.06 s CIBC CM 88.61 0.31 Domino's DPZ 184.91 1.11 HiltonWorldwide HLT 58.47 -0.38 MeadJohnson MJN 88.04 -0.16 s RaymondJames RJF 78.27 0.69 3M MMM 181.60 0.58 AkamaiTech AKAM 63.55 -0.05 s LamarAdvertising LAMR 77.38 0.37 Xilinx XLNX 58.75 -0.76
ArcherDaniels ADM 43.73 0.02 CanNtlRlwy CNI 71.53 0.05 Donaldson DCI 41.97 -0.42 s HomeDepot HD 141.36 1.49 Mednax MD 68.56 0.46 s Raytheon RTN 151.35 -0.50 Tiffany TIF 82.96 1.33 AlexionPharm ALXN 129.50 1.73 LibertyBroadbandA LBRDA 84.51 0.21 s Yahoo YHOO 45.02 -0.44
s Arconic ARNC 29.52 -0.13 CanNaturalRes CNQ 30.36 0.41 s DouglasEmmett DEI 39.21 0.15 HondaMotor HMC 32.01 -0.12 Medtronic MDT 77.05 0.13 RealtyIncome O 60.78 -0.84 TimeWarner TWX 96.39 0.32 AlignTech ALGN 98.39 0.78 LibertyBroadbandC LBRDK 85.80 -0.02 Yandex YNDX 22.69 -0.28
AristaNetworks ANET 100.72 0.82 CanPacRlwy CP 150.16 0.28 Dover DOV 79.75 0.15 s Honeywell HON 123.62 ... s Merck MRK 65.66 0.89 RedHat RHT 80.09 0.32 s Torchmark TMK 76.17 0.31 Alkermes ALKS 57.21 2.41 LibertyGlobal A LBTYA 35.51 0.05 Zillow A ZG 35.72 0.94
ArrowElec ARW 72.21 0.62 Canon CAJ 29.11 0.04 DowChemical DOW 61.72 0.16 HormelFoods HRL 37.59 0.34 MetLife MET 53.88 0.38 RegencyCtrs REG 70.12 -1.12 Toro TTC 59.85 -0.04 Alphabet A GOOGL 840.03 1.07 LibertyGlobal C LBTYK 34.28 -0.12 Zillow C Z 36.30 1.11
AshlandGlobal ASH 120.48 -0.16 CapitalOne COF 90.18 1.15 DrPepperSnap DPS 93.07 -0.42 DR Horton DHI 30.11 -0.31 MettlerToledo MTD 463.31 -0.54 s RegionsFin RF 15.49 0.34 s TorontoDomBk TD 52.47 0.12 Alphabet C GOOG 820.45 1.21 LibertyLiLAC A LILA 22.48 -0.14 s ZionsBancorp ZION 45.08 1.08
Assurant AIZ 95.25 0.93 CardinalHealth CAH 78.88 0.81 DrReddy'sLab RDY 43.84 -0.11 HostHotels HST 18.75 0.19 MichaelKors KORS 38.10 0.50 ReinsuranceGrp RGA 128.50 0.02 Total TOT 50.71 -0.21 Amazon.com AMZN 836.39 -0.14 LibertyLiLAC C LILAK 21.85 -0.10
s AssuredGuaranty AGO 41.27 0.47 Carlisle CSL 104.94 -0.66 DuPont DD 78.05 0.23 HuanengPower HNP 28.03 0.34 MidAmApt MAA 98.79 0.38 RelianceSteel RS 84.30 -0.67 TotalSystem TSS 54.01 -0.02 Amdocs DOX 59.22 -0.29 LibertyQVC A QVCA 19.21 0.18 NYSE MKT
AstraZeneca AZN 29.59 -0.05 CarMax KMX 68.22 0.72 DukeEnergy DUK 78.04 -0.65 Hubbell HUBB 122.42 -0.31 MitsubishiUFJ MTU 6.73 -0.06 RenaissanceRe RNR 143.30 -0.53 ToyotaMotor TM 114.47 0.34 Amerco UHAL 377.46 -0.54 LibertyVenturesA LVNTA 43.86 0.04
Athene ATH 52.35 0.57 Carnival CCL 56.37 -0.09 DukeRealty DRE 25.11 -0.01 Humana HUM 205.97 -0.73 MizuhoFin MFG 3.70 -0.05 RepublicServices RSG 58.43 -0.06 TransCanada TRP 47.65 -0.10 AmericanAirlines AAL 46.57 -0.84 LincolnElectric LECO 83.87 0.17 t BritishAmTob BTI 61.79 -0.52
AtmosEnergy ATO 75.24 -0.39 Carnival CUK 55.27 -0.02 ENI E 30.94 0.09 s HuntingtonIngalls HII 202.59 1.40 MobileTeleSys MBT 10.58 0.02 s ResMed RMD 71.07 0.21 TransDigm TDG 250.20 -2.01 Amgen AMGN 168.05 0.39 LinearTech LLTC 63.85 -0.02 CheniereEnergy LNG 47.88 -0.26
Autoliv ALV 107.19 -0.20 Caterpillar CAT 98.09 -0.41 EOG Rscs EOG 101.23 0.88 HyattHotels H 56.47 0.17 Mobileye MBLY 45.40 -0.08 s RestaurantBrands QSR 54.53 0.73 s TransUnion TRU 37.43 3.29 AnalogDevices ADI 77.84 -0.08 LogMeIn LOGM 94.35 -8.95 CheniereEnerPtrs CQP 31.82 0.17
AutoZone AZO 735.79 -0.30 Celanese A CE 88.38 -0.04 EQT EQT 63.21 0.68 ICICI Bank IBN 8.44 -0.01 MohawkIndustries MHK 224.23 0.43 ReynoldsAmer RAI 60.02 -0.29 Travelers TRV 120.24 0.53 s Apple AAPL 135.02 1.73 lululemon LULU 67.76 0.77 CheniereEnHldgs CQH 23.65 0.33
Avalonbay AVB 178.46 -0.09 Cemex CX 9.05 -0.04 EQT Midstream EQM 81.21 1.01 ING Groep ING 14.52 0.06 MolsonCoors A TAP/A 98.97 2.87 RioTinto RIO 46.25 -0.40 TurkcellIletism TKC 7.58 -0.09 AppliedMaterials AMAT 35.23 -0.23 MarketAxess MKTX 190.07 0.27 ImperialOil IMO 32.49 0.06

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B10 | Wednesday, February 15, 2017 THE WALL STREET JOURNAL.

BANKRATE.COM® MMA, Savings and CDs

Average Yields of Major Banks Tuesday, February 14, 2017
MARKETS
Type MMA 1-MO 2-MO 3-MO 6-MO 1-YR 2-YR 2.5YR 5YR
National average
Savings 0.09 0.07 0.07 0.11 0.16 0.27 0.43 0.44 0.83 Mutual Funds | WSJ.com/fundresearch Fund
Net YTD
NAV Chg % Ret Fund
Net YTD
NAV Chg % Ret Fund
Net YTD
NAV Chg % Ret
Jumbos 0.19 0.07 0.07 0.12 0.18 0.31 0.47 0.46 0.87
Weekly change CapApp 27.11 +0.05 3.5 TotStAdml 58.71 +0.24 4.7
Savings 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.01 0.01 Explanatory Notes Data provided by
J EqInc 32.31 +0.15 2.6 TxMIn r 12.33 ... 5.0
Jumbos 0.00 0.00 0.00 0.00 0.00 0.01 0.00 0.01 0.02 John Hancock Class 1 EqIndex 62.89 +0.27 4.6 ValAdml 37.35 +0.18 3.1
Top 250 mutual-funds listings for Nasdaq-published share classes with net assets of at least LSBalncd 14.74 +0.02 3.5 Growth 57.70 +0.18 8.4 WdsrllAdml 64.58 +0.34 3.6
$500 million each. NAV is net asset value. Percentage performance figures are total returns, LSGwth 15.36 +0.03 4.5 HelSci 64.56 +0.55 9.3 WellsIAdml 62.35 -0.01 1.1
Consumer Savings Rates assuming reinvestment of all distributions and after subtracting annual expenses. Figures don’t
reflect sales charges (“loads”) or redemption fees. NET CHG is change in NAV from previous
John Hancock Instl
DispValMCI 22.54 +0.10 5.0
InstlCapG
IntlValEq
31.74
13.34
+0.08
...
8.5
4.1
WelltnAdml
WndsrAdml
69.23 +0.20
72.71 +0.41
2.6
5.0
Explanation of ratings: Safe Sound SM, (855) 733-0700, evaluates the financial condition of fed- trading day. YTD%RET is year-to-date return. 3-YR%RET is trailing three-year return JPMorgan Funds IntlStk 16.16 -0.01 5.7 VANGUARD FDS
erally insured institutions and assigns a rank of 1,2,3,4 or 5 based on data from the fourth quarter annualized. MCapGro 80.04 +0.17 6.2 DivdGro 24.35 +0.11 3.9
MdCpVal L 37.89 +0.17 4.1
of 2015 from federal regulators. 5: most desirable performance; NR: institution is too new to rate, JPMorgan R Class MCapVal 29.88 +0.10 2.8 GNMA 10.52 -0.01 0.1
e-Ex-distribution. f-Previous day’s quotation. g-Footnotes x and s apply. j-Footnotes e and s 199.17 +1.68 7.8
not an indication of financial strength or weakness. Information is believed to be reliable, but not CoreBond 11.51 -0.02 0.3 N Horiz 46.64 +0.20 7.7 HlthCare r
apply. k-Recalculated by Lipper, using updated data. p-Distribution costs apply, 12b-1. r- INSTTRF2020 20.72 +0.02 2.9
guaranteed. JPMorgan Select Cls N Inc 9.38 -0.01 0.4
Redemption charge may apply. s-Stock split or dividend. t-Footnotes p and r apply. v-Footnotes OverS SF r 9.51 -0.01 4.9 INSTTRF2025 20.77 +0.02 3.3
x and e apply. x-Ex-dividend. z-Footnote x, e and s apply. NA-Not available due to incomplete CoreBond 11.50 -0.02 0.4
High yield savings price, performance or cost data. NE-Not released by Lipper; data under review. NN-Fund not USLgCpCorPls 29.93 +0.21 6.4 R2015 14.60 +0.01 3.0 INSTTRF2030 20.79 +0.03
INSTTRF2035 20.81 +0.03
3.7
4.0
R2020 21.13 +0.02 3.5
Bank/rank Yield Bank/rank Yield tracked. NS-Fund didn’t exist at start of period. INSTTRF2040 20.83 +0.04 4.5
Phone number Minimum (%) Phone number Minimum (%)
L R2025 16.13 +0.03 4.1
LifeCon 18.81 ... 2.0
R2030 23.53 +0.04 4.4
Lazard Instl LifeGro 30.05 +0.05 4.1
Money market and savings account Six-month CD R2035 17.07 +0.03 4.8
Tuesday, February 14, 2017 EmgMktEq 17.28 +0.05 8.3 LifeMod 24.89 +0.02 3.1
R2040 24.39 +0.05 5.1
Dime Community Bank /5 $1,000 1.10 VirtualBank /4 $10,000 1.11 Net YTD Net YTD Net YTD Loomis Sayles Fds
SmCapStk 46.68 +0.08 3.9 PrmcpCor 23.53 +0.07 6.1
(800) 321-3463 (877) 998-2265 Fund NAV Chg % Ret Fund NAV Chg % Ret Fund NAV Chg % Ret LSBondI 13.89 ... 2.7 SelValu r 30.32 +0.10 5.4
SmCapVal 45.93 +0.10 1.8
Lord Abbett A
firstcentral.direct /3 $10,000 1.10 iGObanking.com /3 $1,000 1.10 IntSmCo 18.39 +0.04 6.5 10.03 +0.01 3.8 Value 35.06 +0.18 4.2 STAR 24.56 +0.02 3.7
(866) 400-3272 (888) 432-5890
A IntSmVa 20.37 +0.08 7.1
CpInc r
DivIntl 34.80 -0.04 4.5
ShtDurIncmA p 4.31 ... 0.5 Prudential Cl Z & I STIGrade 10.65 -0.01 0.4
Lord Abbett F TgtRe2015 14.84 ... 2.3
iGObanking.com /3 $25,000 1.10 EverBank /3 $5,000 0.97 American Funds Cl A US CoreEq1 20.13 +0.08 4.5 DivIntlK r 34.73 -0.04 4.5 ShtDurIncm 4.31 ... 0.7
TRBdZ 14.13 -0.03 0.7
AmcpA p 28.71 +0.04 5.4 TgtRe2020 29.07 +0.02 2.9
(888) 432-5890 (855) 228-6755 US CoreEq2 19.38 +0.08 4.1 GroCo 147.66 +0.79 8.0
S TgtRe2025 16.88 +0.01 3.2
AMutlA p 38.08 +0.08 3.4 US Small 34.61 +0.12 2.3 GrowCoK 147.52 +0.79 8.0 M
One-month CD One-year CD BalA p 25.58 +0.03 3.1 US SmCpVal 38.11 +0.21 1.9 Schwab Funds TgtRe2030 30.28 +0.04 3.7
InvGB 7.80 -0.02 0.4 Metropolitan West TgtRe2035 18.46 +0.03 4.1
VirtualBank /4 $10,000 0.15 EverBank /3 $5,000 1.36 BondA p 12.74 -0.03 0.4 US TgdVal 24.64 +0.13 2.6 InvGrBd 11.12 -0.02 0.6 S&P Sel 36.03 +0.16 4.7
CapIBA p 58.94 -0.08 2.3 TotRetBd 10.54 -0.02 0.2 TgtRe2040 31.56 +0.06 4.5
(877) 998-2265 (855) 228-6755 USLgVa 36.50 +0.21 4.0 LowP r 51.22 +0.22 3.5
CapWGrA 45.86 -0.02 4.6 Dodge & Cox TotRetBdI 10.54 -0.01 0.3 T TgtRe2045 19.76 +0.04 4.6
AloStar Bank of Commerce /4 $1,000 0.10 My e-BAnC by BAC Florida Bank /4 $1,500 1.35 EupacA p 47.49 -0.17 5.3
LowPriStkK r 51.18 +0.22 3.5 TRBdPlan 9.92 -0.01 0.4 TgtRe2050 31.79 +0.07 4.6
Balanced 106.94 +0.47 3.5 TIAA/CREF Funds
(877) 738-6391 (855) 512-0989 FdInvA p 57.24 +0.18 5.1 Income 13.66 -0.01 0.5
MagIn 97.01 +0.60 6.2 MFS Funds Class A TgtRetInc 13.00 -0.01 1.5
EqIdxInst 17.36 +0.07 4.6
Mount McKinley Bank /4 $5,000 0.09 VirtualBank /4 $10,000 1.34 GwthA p 44.92 +0.09 6.9 Intl Stk 40.62 +0.10 6.6
OTC 92.30 +0.45 10.8 ValueA p 37.43 +0.15 3.8
Tweedy Browne Fds
TotIntBdIxInv 10.74 -0.01 -0.8
(907) 452-1751 (877) 998-2265 HI TrA p 10.41 +0.01 2.1 Puritn 21.55 +0.06 4.7 MFS Funds Class I WellsI 25.73 -0.01 1.0
Stock 193.27 +1.39 4.9 GblValue 25.72 -0.04 2.7
ICAA p 37.87 +0.08 4.5 SrsEmrgMktF 17.31 +0.04 10.0 ValueI 37.64 +0.15 3.9 Welltn 40.09 +0.12 2.6
DoubleLine Funds
Two-month CD Two-year CD IncoA p 22.28 +0.02 2.8 TotRetBdI NA ... NA
SrsInvGrdF 11.12 -0.02 0.5 Mutual Series V WndsrII 36.40 +0.20 3.6
VirtualBank /4 $10,000 0.15 EverBank /3 $5,000 1.56 N PerA p 37.45 -0.06 6.0 TotalBond 10.55 -0.02 0.6 GlbDiscA 31.59 +0.11 3.3 VANGUARD INDEX FDS
TotRetBdN NA ... NA 216.21 +0.93 4.7
(877) 998-2265 (855) 228-6755 NEcoA p 38.68 +0.12 7.6 Fidelity Selects GlbDiscz 32.18 +0.11 3.4 VANGUARD ADMIRAL 500
500Adml 216.23 +0.93 4.7 ExtndIstPl 188.06 +0.58 4.8
Applied Bank /5 $1,000 0.05 VirtualBank /4 $10,000 1.56 NwWrldA 55.04 -0.04 7.0 F Biotech r 196.76 +2.95 13.0
O BalAdml 32.01 +0.05 2.9 SmValAdml 53.62 +0.16 3.2
(800) 616-4605 (877) 998-2265 SmCpA p 49.16 +0.10 6.9 Federated Instl First Eagle Funds
CAITAdml 11.58 -0.01 0.8 TotBd2 10.61 -0.02 0.3
TxExA p 12.75 -0.02 0.5 StraValDivIS GlbA 56.46 -0.11 4.1 Oakmark Funds Cl I
Nationwide Bank /4 $500 1.51 5.98 -0.01 1.3 CapOpAdml r 132.66 +0.34 6.8 TotIntl 15.58 ... 5.8
WshA p 42.38 +0.17 3.5 Fidelity FPA Funds EqtyInc r 31.55 +0.18 3.7 EMAdmr
(855) 255-1176 75.37 +0.46 4.0 EqIncAdml
32.43 +0.03 8.9 TotSt 58.68 +0.23 4.7
AMG Managers Funds 500IdxInst 82.01 +0.35 4.7 FPACres 33.92 +0.09 4.0 Oakmark 70.33 +0.26 2.9 VANGUARD INSTL FDS
Three-month CD Five-year CD YacktmanFd I 22.27 +0.10 4.1 500IdxInstPrem 82.01 +0.35 4.7 FrankTemp/Frank Adv OakmrkInt 23.83 -0.02 5.0 ExtndAdml 76.21 +0.24 4.8 BalInst 32.02 +0.05 2.9
TAB Bank /4 $1,000 0.85 State Farm Bank /4 $500 2.30 500IdxPrem 82.01 +0.35 4.7 IncomeAdv 2.33 +0.01 2.7 Old Westbury Fds GNMAAdml 10.52 -0.01 0.1 DevMktsIndInst 12.34 -0.01 5.0
B ExtMktIdxPrem r 58.19 +0.17 4.8 FrankTemp/Franklin A LrgCpStr 13.38 +0.02 4.3 GrwthAdml
(800) 837-4136 (877) 734-2265 61.24 +0.20 6.9 ExtndInst 76.20 +0.23 4.8
Baird Funds IntlIdxPrem r 36.82 -0.08 4.2 CA TF A p 7.31 -0.01 0.5 Oppenheimer Y HlthCareAdml r 84.01 +0.71 7.8 61.25 +0.21 6.9
EverBank /3 $5,000 0.83 EverBank /3 $5,000 2.30 AggBdInst 10.72 -0.02 0.3 TMktIdxF r 12.01 -0.01 0.7 DevMktY 34.32 -0.12 7.4 HYCorAdml r
GrwthInst
67.56 +0.27 4.7 Fed TF A p 5.89 ... 1.7 InPrSeIn 10.44 -0.04 0.6
(855) 228-6755 (855) 228-6755 CorBdInst 11.06 -0.02 0.5 TMktIdxPrem 67.56 +0.27 4.7 2.35 +0.01 2.6 IntGrowY 35.70 -0.10 2.9 InfProAd
IncomeA p 25.64 -0.07 0.6 InstIdx 213.36 +0.91 4.7
VirtualBank /4 $10,000 0.82 First Internet Bank of Indiana /4 $1,000 2.07 BlackRock Funds A USBdIdxPrem 11.48 -0.03 0.2 RisDv A p 53.96 +0.04 2.5 IntlGrAdml 73.28 -0.22 8.8 InstPlus 213.38 +0.91 4.7
(877) 998-2265 (888) 873-3424 GlblAlloc p 18.76 +0.03 3.2 USBdIdxInstPrem 11.48 -0.03 0.2 FrankTemp/Franklin C
P ITBondAdml 11.24 -0.04 0.3 InstTStPlus 52.70 +0.22 4.7
BlackRock Funds C Fidelity Advisor I Income C t +0.01 2.9 Parnassus Fds
2.38 ITIGradeAdml 9.65 -0.03 0.4 MidCpInst 38.04 +0.10 5.7
High yield jumbos - Minimum is $100,000 GlblAlloc t 17.07
BlackRock Funds Inst
+0.03 3.1 NwInsghtI 28.56 +0.11 6.9 FrankTemp/Temp A ParnEqFd 40.58 +0.15 3.3 LTGradeAdml 10.04 -0.05 0.3 MidCpIstPl 187.59 +0.48 5.7
Fidelity Freedom GlBond A p +0.07 2.9 PIMCO Fds Instl
12.32 MidCpAdml 172.18 +0.43 5.7 SmCapInst 64.35 +0.21 4.2
Money market and savings account Six-month CD EqtyDivd 23.21 +0.14 2.9 FF2020 15.53 +0.02 3.6 Growth A p 24.50
+0.02 4.0 AllAsset NA ... NA MuHYAdml 11.02 -0.02 0.6 STIGradeInst 10.65 -0.01 0.4
GlblAlloc 18.87 +0.03 3.2 FF2025 13.34 +0.02 3.8 HiYld 8.91 ... 1.8 MuIntAdml 13.93 -0.02 0.6 TotBdInst 10.65 -0.02 0.3
ableBanking,adivisionofNortheastBank/4 1.00 VirtualBank /4 1.11 7.74 ... 2.0 FF2030
FrankTemp/Temp Adv
HiYldBd 16.50 +0.03 4.5 TotRt 10.08 -0.03 0.8 MuLTAdml 11.37 -0.02 0.3 TotBdInst2 10.61 -0.02 0.3
(877) 505-1933 (877) 998-2265 StratIncOpptyIns 9.91 +0.01 1.1 FreedomK2020 14.45
GlBondAdv p 12.27
+0.07 2.8
+0.02 3.5 PIMCO Funds A MuLtdAdml 10.90 -0.01 0.8 TotBdInstPl 10.65 -0.02 0.3
California First National Bank /4 1.00 EverBank /3 0.97 NA ... NA MuShtAdml TotIntBdIdxInst 32.24 -0.02 -0.8
(800) 735-2465 (855) 228-6755 D FreedomK2025 15.15 +0.02 3.8 H IncomeFd 15.76 ... 0.4
TotIntlInstIdx r 104.20 -0.02
FreedomK2030 15.56 +0.04 4.6 PIMCO Funds D PrmcpAdml r 115.44 +0.25 6.1 5.8
EH National Bank /2 0.87 My e-BAnC by BAC Florida Bank /4 0.93 Del Invest Instl FreedomK2035 16.19 +0.04 5.0
Harbor Funds IncomeFd NA ... NA REITAdml r 118.23 -0.67 1.2 TotItlInstPlId r 104.22 -0.02 5.8
(888) 392-5265 (855) 512-0989 Value 20.12 +0.09 2.2 FreedomK2040 16.22 +0.05 5.1 CapApInst 61.10 +0.17 7.9 PIMCO Funds Instl SmCapAdml 64.35 +0.21 4.2 TotStInst 58.72 +0.24 4.7
Dimensional Fds Fidelity Invest IntlInst r 60.95 -0.16 4.3 IncomeFd NA ... NA STBondAdml 10.43 -0.01 0.2 ValueInst 37.35 +0.18 3.1
One-month CD One-year CD 5GlbFxdInc 10.90 -0.01 0.3 Balanc 22.96 +0.06 4.3 PIMCO Funds P STIGradeAdml 10.65 -0.01 0.4
USAA /5 0.22 My e-BAnC by BAC Florida Bank /4 1.36 EmgMktVa 26.58 +0.08 11.0 BluCh 73.29 +0.27 8.8
I IncomeP NA ... NA TotBdAdml 10.65 -0.02 0.3 W
(800) 583-8295 (855) 512-0989 EmMktCorEq 19.13 +0.04 10.2 Contra 105.45 +0.37 7.8 Invesco Funds A Price Funds TotIntBdIdxAdm 21.48 -0.02 -0.8 Western Asset
VirtualBank /4 0.15 EverBank /3 1.36 IntlCoreEq 12.32 +0.01 5.7 ContraK 105.38 +0.37 7.8 EqIncA 10.86 +0.05 2.8 BlChip 78.32 +0.17 7.9 TotIntlAdmIdx r 26.06 ... 5.8 CorePlusBdI NA ... NA
(877) 998-2265 (855) 228-6755
AloStar Bank of Commerce /4 0.10 VirtualBank /4 1.34
(877) 738-6391
Two-month CD
(877) 998-2265
Two-year CD
New Highs and Lows | WSJ.com/newhighs Stock
52-Wk %
Sym Hi/Lo Chg Stock
52-Wk %
Sym Hi/Lo Chg Stock
52-Wk %
Sym Hi/Lo Chg
VirtualBank /4 0.15 Nationwide Bank /4 1.56 Chubb CB 134.16 0.1 FB Financial FBK 32.11 2.8 Insperity NSP 86.35 2.0
(877) 998-2265 (855) 255-1176 The following explanations apply to the New York Stock Exchange, NYSE Arca, NYSE MKT and Ciena CIEN 25.79 0.4 Fabrinet FN 48.26 2.3 IBM IBM 180.13 0.4
Nasdaq Stock Market stocks that hit a new 52-week intraday high or low in the latest session. CitizensFin CFG 38.07 2.9 Ferrari RACE 66.57 ... IntlSeaways INSW 18.32 1.3
Applied Bank /5 0.05 VirtualBank /4 1.56 ClearBridgeAmEn CBA 10.54 0.9 FiatChrysler FCAU 11.49 4.4 JPMorganWt JPM/WS 48.10 3.0
% CHG-Daily percentage change from the previous trading session.
(800) 616-4605 (877) 998-2265 ClearBridgeEnMLPFd CEM 17.96 -0.7 Flagstar FBC 29.64 -1.8 JPMorganChase JPM 89.70 1.6
Citizens Trust Bank /4 0.01 EverBank /3 1.56 Comerica CMA 72.23 3.1 FortressInvt FIG 6.36 6.5 KAR Auction KAR 46.51 0.2
Tuesday, February 14, 2017 CMA/WS 42.75 4.9 FdnBuilding FBM 16.17 ... KayneAnMLPInv KYN 22.07 1.1
(404) 659-5959 (855) 228-6755 ComericaWt
Cooper COO 192.38 0.2 GEO Group GEO 45.13 1.1 KeyCorp KEY 18.93 2.2
52-Wk % 52-Wk % 52-Wk % LFL 10.15 -0.1
CorEnergyInfrPf CORRpA 26.55 0.8 GabelliDividend GDV 20.85 0.6 LATAMAirlines
Three-month CD Five-year CD Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Corning GLW 27.24 1.9 GabelliGlbSmall&MC GGZ 11.22 0.2 L3 Tech LLL 166.87 0.2
EverBank /3 0.83 State Farm Bank /4 2.30 AlumofChina ACH 13.85 2.7 BankofMontreal BMO 77.15 ... DCP Midstream DCP 41.14 1.8 Gallagher AJG 55.79 ... LazardGlblFd LGI 14.64 0.5
24.05 2.6 LeucadiaNatl LUK 24.94 2.6
(855) 228-6755 (877) 734-2265 NYSE highs - 202 AmEqtyLf AEL 27.41 2.4 BkNovaScotia BNS 61.96 0.3 DelEnhGlDivInc DEX 10.62 0.4 GasLogPartners GLOP
USA 5.53 0.4
AXP 79.45 0.6 BankUnited BKU 40.24 3.4 DeutscheHiIncmOpps DHG 14.80 -0.1 Generac GNRC 44.84 -6.7 LibertyAllStar
VirtualBank /4 0.82 EverBank /3 2.30 AberdeenGrChinaFd GCH 9.42 0.3
AmericanExpress
92.59 0.6 Belmond 14.30 ... Dividend&IncomeFd DNI 12.51 0.2 GenAmInv GAM 33.40 0.2 LincolnNatlWt LNC/WS 66.51 1.9
AmericanFin AFG BEL
(877) 998-2265 (855) 228-6755 AberdeenSingapore SGF 9.86 -0.7 Ameriprise AMP 128.38 1.3 Berkley WRB 69.19 0.7 DouglasEmmett DEI 39.28 0.4 Glaukos GKOS 46.09 2.9
LincolnNational LNC 72.52 1.5
LMP Capital SCD 14.03 0.6
EH National Bank /2 0.82 First Internet Bank of Indiana /4 2.07 AdamsDivEquityFd ADX 13.52 0.5 AnadarkoPeteUn AEUA 46.02 0.2 BlkRkDebtStratFd DSU 11.65 0.6 EastmanChem EMN 80.64 0.6 GoldmanSachs GS 250.00 1.3
M&T Bank MTB 169.08 0.9
AerCap AER 47.16 0.8 ANTM 165.88 -0.1 BlueCapReins BCRH 20.00 2.3 EtnVncTxAdvGbl ETG 15.47 0.6 HCAHoldings HCA 84.31 ...
(888) 392-5265 (888) 873-3424 AL 39.58 1.6
Anthem
EtnVncByWrFd ETV 15.49 0.5 HCI Group 45.43 1.7
M&TBankWt MTB/WS 94.50 3.3
AirLease AnthemUn ANTX 50.14 0.7 BoulderGrowth BIF 9.28 0.5 HCI
MFS SpcVal MFV 5.90 1.2
Aircastle AYR 25.98 8.7 ArconicPfdB ARNCpB 45.55 0.2 Box BOX 18.36 -0.2 EtnVncTxAdvDiv EVT 22.06 0.5 HP HPQ 16.41 0.1
Notes: Accounts are federally insured up to $250,000 per person effective Oct. 3, 2008. Yields MGIC Investment MTG 11.35 -0.1
Alleghany Y 623.60 0.2 Arconic ARNC 30.16 -0.4 Brink's BCO 53.90 ... EatVnceTxEqty ETY 11.06 0.2 HSBCHoldings HSBC 43.57 0.5 MSCI
are based on method of compounding and rate stated for the lowest required opening deposit to MSCI 96.33 1.3
AllianzGIEqtyConv NIE 19.48 0.3 AssociatedBanc ASB 26.50 2.7 CBRE Group CBG 35.22 1.9 EmersonElectric EMR 64.36 ... Harris HRS 107.97 0.9 Marsh&McLennan MMC 71.99 0.6
earn interest. CD figures are for fixed rates only. MMA: Allows six (6) third-party transfers per AllisonTransm ALSN 38.07 0.4 AssocCapital AC 37.70 2.3 CNA Fin CNA 44.39 2.0 EnableMidstream ENBL 17.36 0.1 HerculesCapital HTGC 14.96 1.7 MauiLand MLP 8.10 3.2
Allstate ALL 79.82 0.2 AssuredGuaranty AGO 41.29 1.2 CNO Financial CNO 21.18 1.3 EnPro NPO 69.31 0.6 HomeDepot HD 141.37 1.1 Merck MRK 65.72 1.4
month, three (3) of which may be checks. Rates are subject to change. ALLY 23.41 1.6 35.29 -2.7 CPFLEnergia 16.48 0.7 RE 234.44 0.2 Honeywell HON 123.96 ... Meredith
AllyFinancial Autohome ATHM CPL EverestRe MDP 63.45 -0.1
Source: Bankrate.com, a publication of Bankrate, Inc., North Palm Beach, FL 33408 AlpineGlblDyn AGD 9.67 0.1 BB&T BBT 47.93 1.9 CIBC CM 88.79 0.4 Exar EXAR 11.18 0.5 HudbayMineralsWt HBM/WS 1.04 -7.8 MorganStanleyPfdK MSpK 25.63 ...
Internet: www.bankrate.com AlpineTotDynDiv AOD 8.28 0.6 BankofAmWtA BAC/WS/A 11.73 4.2 CharlesRiverLabs CRL 89.59 7.9 ExtendedStayAmer STAY 17.52 -0.7 HuntingtonIngalls HII 203.63 0.7
AltisourceResid RESI 13.41 1.1 BankofAmerica BAC 24.17 2.8 Chemed CHE 171.05 1.1 Exterran EXTN 34.05 5.3 Huntsman HUN 21.74 2.0 Continued to page B11

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INVESTMENT PROPERTIES

1031 Exchange and Direct Investment Opportunities $"' (('))))

Minimum Investment: 100k to 25 Million 5-8% Projected Cash Flow
§ Wal-Mart Neighborhood Market in Fayetteville, NC

NOTABLE
§ Multi-Tenant Office in Tampa Florida MSA MASSACHUSETTS AUCTIONS
§ FedEx Ground Distribution Facility in Brookings, OR

COMMERCIAL § Single Tenant NNN Industrial in Chesapeake, VA

§ Multifamily Apartments – 268 units in Richmond, VA
PROPERTIES § Multifamily Apartments – 232 units in Jacksonville Florida MSA
For Full Details Contact: 1(855) 466-5927 or email: info@kpi1031.com
EVERY WEDNESDAY Kay Properties and Investments, LLC § www.kpi1031.com
Disclosures: Accredited investors only. All properties are Regulation D Rule 506c offerings.
All real estate contains risk. Please read the full private placement memorandum for a discussion
of each properties business plan and risk factors. There are no guarantees for projected cash flow
and/or appreciation. Please do not invest in real estate offerings if you cannot afford to lose your
LIST YOUR entire investment principal. Securities offered through registered representatives of
Colorado Financial Service Corporation, Member FINRA/SIPC.
 
PROPERTY TODAY $'#$$ 0($/..$"  (0/1
AUCTIONS AUCTIONS
  
 
 


  

   



  
 
(800) 366-3975 ABSOLUTE BANKRUPTCY  

 
 

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FOR INFO:  

 
 


WWW.BILLHALLAUCTIONEER.COM
254.760.1156 TXS-6964 INVESTMENT PROPERTIES INVESTMENT PROPERTIES

COMMERCIAL PROPERTIES
5 Acres of R-3 Infill Land in Santa Barbara
INVESTMENT PROPERTIES "DHL" Airport BLDG For Sale Excellent Long-Term Investment with Income
Leasehold Interest
Currently Mobile Home Park -- Major Upside
Joplin, MO LEASED INDUSTRIAL Class “A” 62,000 Sq Ft
Salt Lake City Airport Priced Below Land Value -- Trophy Property
20 to 40 acres HERC RENTAL CENTER Long Term Land Lease $6,495,000 Firm - Only $29 per square foot
Near Missouri State Hwy 66, and
NYSE – HRI Strong Cap Rate, NN Lease Buyer must close by the end of February
new Interstate 49 exits. Acreage includes NEW 10 YR. LEASE On Tarmac Mission Critical Facility SantaBarbaraMHP@gmail.com
4 nice residential rentals. 24,700 sf on 3.42 ac 954-971-6775 § speno.tom@prd-realty.com Call or Text 805-335-1545
$21,000 per acre. Fwy. location, Phx, AZ
© 2016 Dow Jones & Company, Inc.
All Rights Reserved. Call (417) 439-9131 DAUM CRE (602) 957-7300
THE WALL STREET JOURNAL. NY Wednesday, February 15, 2017 | B11

NEW HIGHS AND LOWS |WSJ.com/newhighs

Continued From Page B10 52-Wk % 52-Wk % 52-Wk % 52-Wk % 52-Wk % 52-Wk % 52-Wk % 52-Wk %
52-Wk % Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg
Stock Sym Hi/Lo Chg WooriBank WF 36.67 1.8 GlblXChnaIndust CHII 13.89 0.4 iShS&P500Growth IVW 128.81 0.3 SPDRS&P1500ValTilt VLU 95.82 0.4 AudioCodes AUDC 7.25 0.7 GlbXS&P500Catholic CATH 28.38 0.2 Radware RDWR 16.18 0.6
MorganStanley MS 46.26 1.7
WW Ent
Wyndham
WWE
WYN
23.14 -0.7 GlblXGuruIndexETF GURU
82.57 0.1 GlbXJPMEfficiente EFFE
25.62
25.04
0.5
0.1
iShGlobalTechETF IXN
iShGloblFinancials IXG
118.97 0.2 SPDRS&P500Growth SPYG
60.91 0.7 SPDRS&P500Value SPYV
111.44 0.3
113.30 0.6
NYSE Arca lows - 29 AxarAcqnUn
BCB Bancorp
AXARU 10.20 0.5 GoldenOcean
BCBP 14.20 -0.4 Goodyear
GOGL
GT
6.41
36.42
5.8
0.1
RealPage
SBA Comm
RP
SBAC
33.60
109.78
1.2
-0.8
Neff NEFF 16.80 2.2 28.87 -2.8
XL Group XL 40.35 0.3 GlbXSciBetaUS SCIU 27.53 0.1 iShS&P500ValueETF IVE 104.67 0.6 SPDRS&PBank KBE 45.41 1.6 PathS&P500VIXMT VXZ B/EAerospace BEAV 62.35 0.2 Grifols GRFS 17.50 1.2 SLM PfdA SLMAP 51.90 -0.7
NobleMidstream NBLX 47.88 0.6 16.86 -4.3
GlobalXUraniumETF URA 19.29 2.8 iSharesGlobal100 IOO 79.66 0.3 SPDRS&PCapitalMkts KCE 47.76 0.5 iPathS&P500VIXST VXX BGC Partners BGCP 11.67 0.3 IPG Photonics IPGP 120.11 0.8 SVB Fin SIVB 186.50 2.7
Norbord OSB 29.06 1.4 50.60 -0.6 DrxFinancBear 3x FAZ 18.85 -2.7
NuvDow30Dyn DIAX 15.89 0.5 NYSE lows - 9 GoldmanSachsUSLC GSLC
GSHedgeIndVIP GVIP
46.36
45.38
0.4
0.2
iShGlobalConsDiscr RXI
iShS&PMC400Value IJJ
94.28 0.3 SPDRS&PEmgLatAmer GML
150.77 0.3 SPDRS&P500Buyback SPYB 54.70 0.5 DirexionSP500Bear SPXS 9.44 -1.3
BankofCommerce BOCH
BMOElkhornDWAMLP BMLP
10.90 0.7 Icon
57.06 0.6 Identiv
ICLR
INVE
87.27
5.82
2.0
21.9
SandySpringBncp SASR
Seagate STX
42.65
48.14
1.3
0.1
NuvPfd2022Term JPT 25.29 0.1 AquaVenture WAAS 16.20 -5.5 GuggDefEqty DEF 40.42 0.1 iSharesNATech-Mult IGN 46.66 0.6 SPDRS&P500Fossil SPYX 56.44 0.5 DirexionS&PBiotech LABD 11.71 -4.7 BioShBiotechPrd BBP 37.56 1.1 iFresh IFMK 12.28 2.0 ServisFirstBcshs SFBS 42.34 0.2
OFGBancorpPfD OFGpD 24.28 ... BlkRkMuniyldNJ Fd MYJ 15.16 -1.2 GuggenheimSP500EqW RSP 90.55 0.3 iShNorthAmerTech IGM 134.19 0.2 SPDRS&PHlthCareEqp XHE 53.91 1.3 DirexionS&P500Br1X SPDN 17.74 -0.4 BEAT 25.50 3.4 Incyte
BioTelemetry INCY 125.49 1.8 ShilohIndustries SHLO 13.90 4.2
OrchidIslandCap ORC 12.60 -0.7 Christopher&Banks CBK 1.13 -3.3 Guggenheim S&P 500 RYF 38.67 1.1 iSharesDowJonesUS IYY 117.55 0.5 SPDRS&PInsurance KIE 86.60 0.4 DirexionTechBear1X TECZ 21.00 -0.4 BLKB 72.26 0.7
Blackbaud IndependentBank IBTX 66.30 1.0 SinclairBroadcast SBGI 36.20 ...
PJT Partners PJT 37.33 2.4 ClipperRealty CLPR 13.27 0.1 GuggenheimS&P500 RPV 60.32 0.9 iShUSBrokerDealers IAI 53.32 0.6 SPDRS&P1000ETF SMD 92.40 -0.4 DrxTechMktBear 3x TECS 14.31 -1.0 BLUE 80.20 3.7 Intevac
bluebirdbio IVAC 11.40 3.2 SodaStream SODA 47.50 1.2
PNC Fin Wt PNC/WS 58.93 2.7 JaggedPeakEner JAG 13.75 -0.5 GuggRayJamesSB1 RYJ 40.21 0.6 JPMorgAlerian AMJ 34.22 0.8 SPDRS&PRegionalBkg KRE 57.78 1.8 GlbXMSCINigeria NGE 3.85 -1.5 BOJA 20.90 -0.2 iRhythmTechs
Bojangles' IRTC 37.06 -1.6 SolarCapital SLRC 22.09 1.0
PNC Fin PNC 126.23 1.4 NordicAmerOffshr NAO 2.35 -4.1 GuggS&P500Top50 XLG 164.18 0.4 JanusVelTailRIskLC TRSK 29.07 0.7 SPDR US LC Low Vol LGLV 83.39 0.2 iPathBloomCocoaTR NIB 23.38 -1.1 BRKS 21.84 0.4 iShMSCIACWIETF ACWI
Brooks Auto 62.18 0.2 SolarSeniorCap SUNS 17.25 -0.2
POSCO PKX 61.82 1.2 PIMCO Muni PMF 13.58 -1.9 GuggenS&PMC400EW EWMC 59.80 0.3 JanusVelocityVolLC SPXH 32.53 0.1 SchwabFundEmgLrg FNDE 26.48 0.5 iPathPBCocoa CHOC 28.77 -1.0 CDK 65.94 0.5 iShMSCIBrazilSC EWZS
CDK Global 14.12 1.0 SprottFocus FUND 7.63 1.0
PioneerNatRscs PXD 199.83 0.9 Tidewater TDW 1.25 6.1 HartfordMultiGlbSC ROGS 27.36 0.3 JohnHanMultDev JHMD 25.98 0.9 SchwabFundIntlSmCo FNDC 30.12 0.2 ProShrShrtDow30 DOG 18.29 -0.5 CDW 59.62 0.2 iSharesMSCIEAFESC SCZ
CDW 52.93 0.3 StonegateBank SGBK 47.47 1.1
PiperJaffray PJC 80.80 0.9 VinceHolding VNCE 1.95 -16.0 HartfordMultiUSEqu ROUS 26.96 0.4 JohnHancockMultFin JHMF 32.29 1.1 SchwabFundUSBrd FNDB 33.65 0.5 ProShrShrtFinc SEF 13.36 -0.7 CadenceDesign CDNS 29.94 0.3 iShMSCIEMESGOpt ESGE 59.60 ... SummitStateBk SSBI 17.50 4.2
PlatformSpecialty PAH 12.96 0.8 HrznsS&P500CovCall HSPX 47.12 0.2 JohnHancockMultiLC JHML 30.48 0.2 SchwabFundUSLrgCo FNDX 33.69 0.5 ProShrS MSCI EM EUM 22.72 -0.1 CalamsGlblDynInc CHW 7.66 0.4 iShMornMCValue JKI 150.17 0.3 SyneronMedical ELOS 10.40 7.3
PFG 62.59 ...
PrincipalFin
ProspectCapNt PBB 26.11 -0.4
NYSE Arca highs - 269 IQ CndaSmCap CNDA
iPathPBAluminum FOIL
18.49
26.22
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25.80 0.8 SchwUS LrgCap SCHX
56.71 0.4 ProShrShortQQQ PSQ
55.82 0.4 ProShShrtS&P500 SH
43.58
34.95
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CardiovascularSys CSII
CarolinaBankNC CLBH
28.45 1.3 JamesRiver
28.66 0.4 JounceTherap
JRVR 42.47 2.0 TICC Capital
TOR Minerals
TICC
TORM
7.93
7.20
2.9
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PRU 110.99 0.6 ALPS EqSecWgh EQL 62.39 0.2 iPathS&PMLPETN IMLP 15.86 -0.9 JNCE 22.82 1.8
PrudentialFin 22.00 0.8 OppESGRevenue ESGL 27.76 0.3 SchwUSLrgCpGrwth SCHG 59.62 0.4 ProShShtS&PRegBkg KRS CathayGenBncp CATY 39.05 1.0 Kamada KMDA 7.25 0.3 TTM Tech TTMI 17.86 -0.1
QuintilesIMS Q 83.04 2.9 ARKInnovationETF ARKK 23.22 0.7 iShCoreDivGrowth DGRO 30.11 0.4 OppenheimFclsSect RWW 60.20 0.9 SchwabUSLgCpValue SCHV 49.56 0.4 ProSharesUltVIXST UVXY 18.73 -8.7 CavcoIndustries CVCO 113.50 -0.7 KtckyFstFdBcp KFFB 10.00 1.5 Tesla TSLA 287.39 0.1
RAIT Fin PfdA RASpA 22.15 0.1 AdvisorDorseyADR AADR 45.90 -0.4 iShCoreMSCIEmgMk IEMG 46.57 ... OppenheimerGlbGwth RGRO 50.30 -0.1 SchwabUSMidCap SCHM 47.30 0.2 ProShrsShrtDow30 SDOW 36.32 -1.5 CRNT 4.23 ... KraftHeinz
Ceragon KHC 91.06 0.3 VanguardRuss1000 VONE 107.48 0.5
RadianGroup RDN 19.87 -0.6 AdvShWilshireBuybk TTFS 66.25 0.4 iShCoreS&P500ETF IVV 235.15 0.4 OppenheimerLgCpRev RWL 45.30 0.5 SPDR DJIA Tr DIA 205.18 0.5 ProShUltraProShFnl FINZ 14.24 -2.1 CHMG 37.62 -0.2 LamarAdvertising LAMR
ChemungFinl 77.49 0.5 VangdRuss1000Grw VONG 114.30 0.4
RaymondJames RJF 78.64 0.9 AlphaCloneAltAlpha ALFA 37.66 0.2 iShS&PTotlUSStkMkt ITOT 53.71 0.4 PwrshsDynNetw PXQ 43.18 0.3 SPDREmMktSmlCp EWX 44.18 ... ProShUltProShS&P SPXU 17.85 -1.3 CSCO 32.31 1.1 LeggMasonUSDivCore UDBI
CiscoSystems 28.16 1.6 VangdRuss1000Val VONV 100.92 0.4
Raytheon RTN 152.93 -0.3 BarclaysETNShiller CAPE 101.49 0.5 iShCoreS&PUSGrowth IUSG 45.45 0.4 PwrShsDynMkt PWC 83.52 0.3 SPDR S&P 500 SPY 233.71 0.4 ProShrUSCnsmrGd SZK 16.90 -1.0 CtznCmntyBcp CZWI 12.85 0.9 Lumentum LITE 51.25 1.9 VanguardRuss3000 VTHR 107.74 0.3
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B12 | Wednesday, February 15, 2017 THE WALL STREET JOURNAL.

MARKETS DIGEST
EQUITIES

Dow Jones Industrial Average S&P 500 Index Nasdaq Composite Index
Last Year ago Last Year ago Last Year ago
20504.41 s 92.25, or 0.45% Trailing P/E ratio * 20.82 16.65 2337.58 s 9.33, or 0.40% Trailing P/E ratio * 24.48 20.58 5782.57 s 18.62, or 0.32% Trailing P/E ratio * 25.15 19.81
High, low, open and close for each P/E estimate * 17.38 14.59 High, low, open and close for each P/E estimate * 17.75 15.25 High, low, open and close for each P/E estimate * 19.65 16.38
trading day of the past three months. Dividend yield 2.31 2.70 trading day of the past three months. Dividend yield 2.04 2.39 trading day of the past three months. Dividend yield 1.15 1.30
All-time high 20504.41, 02/14/17 All-time high: 2337.58, 02/14/17 All-time high: 5782.57, 02/14/17

Current divisor 0.14602128057775

20600 2325 5760

20100 2295 5650

19600 2265 5540

65-day moving average
Session high 19100 2235 5430
DOWN UP
t

Session open Close

18600 2205 5320
Close Open
t

65-day moving average

Session low 18100 2175 65-day moving average 5210

Bars measure the point change from session's open

17600 2145 5100
Nov. Dec. Jan. Feb. Nov. Dec. Jan. Feb. Nov. Dec. Jan. Feb.
* P/E data based on as-reported earnings from Birinyi Associates Inc.

Major U.S. Stock-Market Indexes Late Trading Trading Diary

Latest 52-Week % chg Most-active and biggest movers among NYSE, NYSE Arca, NYSE MKT Volume, Advancers, Decliners
High Low Close Net chg % chg High Low % chg YTD 3-yr. ann. and Nasdaq issues from 4 p.m. to 6:30 p.m. ET as reported by electronic NYSE NYSE MKT
Dow Jones trading services, securities dealers and regional exchanges. Minimum Total volume* 813,626,217 18,238,172
Industrial Average 20504.41 20374.02 20504.41 92.25 0.45 20504.41 16196.41 26.6 3.8 8.3 share price of $2 and minimum after-hours volume of 5,000 shares. Adv. volume* 517,868,348 6,246,485
Transportation Avg 9471.12 9405.56 9444.22 -31.56 -0.33 9475.78 7093.40 31.0 4.4 8.9 Most-active issues in late trading Decl. volume* 282,530,851 11,713,434
Utility Average 670.32 663.62 667.37 -4.23 -0.63 723.51 611.99 8.6 1.2 8.7 Volume After Hours Issues traded 3,124 339
Company Symbol (000) Last Net chg % chg High Low Advances 1,574 148
Total Stock Market 24316.02 24161.92 24315.95 92.57 0.38 24315.95 19368.52 25.5 4.5 7.9
Micron Technology MU 10,736.2 23.23 0.11 0.476 23.24 22.90 Declines 1,424 167
Barron's 400 623.98 619.51 623.68 2.38 0.38 623.68 467.50 33.4 3.7 7.3
SPDR S&P 500 SPY 7,308.5 233.66 -0.04 -0.02 233.94 232.78 Unchanged 126 24
Nasdaq Stock Market Bank of America BAC 5,703.7 24.08 0.02 0.08 24.09 23.67 New highs 202 17
Nasdaq Composite 5783.09 5748.74 5782.57 18.62 0.32 5782.57 4435.96 30.4 7.4 10.9 Symantec SYMC 5,207.5 28.82 0.14 0.49 28.82 28.68 New lows 9 3
5271.10 5238.69 14.26 5271.07 4104.33 8.4 Closing tick 341 20
Nasdaq 100 5271.07 0.27 28.4 12.9 AbbVie ABBV 3,966.0 60.82 … unch. 60.93 60.02
Closing Arms† 0.59 1.55
iShares MSCI Emg Markets EEM 3,929.0 38.39 0.01 0.01 38.41 38.16
Standard & Poor's Block trades* 6,373 239
0.40
Procter Gamble PG 3,819.8 90.42 2.56 2.91 91.60 87.77
500 Index 2337.58 2322.17 2337.58 9.33 2337.58 1895.58 23.3 4.4 8.3 Nasdaq NYSE Arca
Gpo Fin Santander MX ADR BSMX 3,809.0 7.31 -0.003 -0.04 7.31 7.31
MidCap 400 1730.24 1718.15 1729.56 3.89 0.23 1729.56 1289.23 34.2 4.2 8.7 Total volume*1,918,469,260 265,734,840
SmallCap 600 853.71 846.97 853.19 1.73 0.20 857.50 611.77 39.5 1.8 9.6 Percentage gainers… Adv. volume*1,196,375,225 160,818,182
Decl. volume* 677,419,136 104,013,915
Other Indexes Fortress Invt Group Cl A FIG 224.1 7.66 1.45 23.35 7.90 6.25
Issues traded 3,009 1,343
Russell 2000 1397.14 1386.35 1396.65 4.27 0.31 1396.65 995.80 40.3 2.9 6.7 SolarEdge Technologies SEDG 76.3 15.40 0.95 6.54 15.95 14.04
Advances 1,598 762
NYSE Composite 11468.88 11396.51 11468.88 34.94 0.31 11468.88 9375.39 22.3 3.7 3.7 ImmunoCellular Therap IMUC 9.9 3.15 0.19 6.42 3.18 3.06 Declines 1,218 549
Value Line 524.47 521.51 524.40 1.25 0.24 524.40 401.32 30.7 3.6 2.7 Rigel Pharmaceuticals RIGL 23.9 2.50 0.13 5.49 2.50 2.37 Unchanged 193 32
NYSE Arca Biotech 3421.21 3354.35 3419.56 56.36 1.68 3477.87 2776.57 20.6 11.2 9.1
Potbelly Corp. PBPB 8.8 13.50 0.60 4.65 14.00 12.90 New highs 196 269
New lows 28 29
NYSE Arca Pharma 497.90 492.31 497.85 3.65 0.74 554.66 463.78 1.7 3.4 0.4 ...And losers
Closing tick 217 68
KBW Bank 96.07 94.04 95.94 1.73 1.83 95.94 59.84 56.8 4.5 11.7 Fossil Group FOSL 1,674.4 19.54 -3.33 -14.56 23.36 19.20 Closing Arms† 0.74 0.89
PHLX§ Gold/Silver 95.57 93.13 94.27 -0.25 -0.26 112.86 57.24 64.7 19.5 -2.6 Trupanion TRUP 5.6 14.54 -1.99 -12.04 16.53 13.00 Block trades* 7,414 1,450
PHLX§ Oil Service 182.98 179.64 182.73 2.20 1.22 192.66 136.56 33.8 -0.6 -12.4 Natural Alternatives Intl NAII 33.1 9.70 -1.25 -11.42 11.10 9.70 * Primary market NYSE, NYSE MKT NYSE Arca only.
PHLX§ Semiconductor 964.12 957.00 962.63 -3.07 -0.32 972.14 591.93 62.6 6.2 19.9 Calix CALX 9.3 7.00 -0.65 -8.50 7.70 7.00 †(TRIN) A comparison of the number of advancing and declining
11.34 10.73 -0.33 -2.98 25.76 10.58 -55.5 -23.5 issues with the volume of shares rising and falling. An
CBOE Volatility 10.74 -7.5 LendingClub LC 615.4 6.14 -0.46 -6.97 6.61 6.04 Arms of less than 1 indicates buying demand; above 1

Philadelphia Stock Exchange Sources: SIX Financial Information; WSJ Market Data Group indicates selling pressure.

International Stock Indexes Percentage Gainers... Percentage Losers

Latest YTD
Region/Country Index Close Net chg % chg % chg Latest Session 52-Week Latest Session 52-Week
Company Symbol Close Net chg % chg High Low % chg Company Symbol Close Net chg % chg High Low % chg
World The Global Dow 2639.78 –0.01 –0.0002 4.3 ZAIS Group Holdings Cl A ZAIS 4.32 2.27 110.73 8.72 1.29 -26.0 Gevo Inc GEVO 1.59 -0.74 -31.76 27.20 1.55 -80.9
The Global Dow Euro 2352.91 9.20 0.39 4.1 Reliv International RELV 7.53 1.73 29.83 12.53 3.57 31.2 My Size MYSZ 7.88 -3.09 -28.17 16.70 3.84 ...
DJ Global Index 341.26 –0.02 –0.01 4.7 Cynosure Cl A CYNO 65.93 14.43 28.01 65.95 34.47 81.1 Northern Dynasty Minerals NAK 2.50 -0.68 -21.38 3.45 0.28 624.6
World DJ Global ex U.S. 224.11 –0.95 –0.42 4.8 Function(x) FNCX 2.72 0.56 25.93 16.48 1.72 -48.1 Catalyst Biosciences CBIO 7.83 -1.67 -17.58 50.70 6.75 -74.7
Americas DJ Americas 566.38 1.90 0.34 4.8 ImmunoCellular Therap IMUC 2.96 0.54 22.31 14.80 1.83 -69.1 KBS Fashion Group KBSF 8.08 -1.72 -17.55 18.00 2.16 25.2
Brazil Sao Paulo Bovespa 66712.88 –254.76 –0.38 10.8 Identiv Inc. INVE 5.68 1.02 21.89 5.82 1.55 228.3 Vince Holding VNCE 2.10 -0.40 -16.00 8.11 1.95 -55.2
Canada S&P/TSX Comp 15786.03 29.45 0.19 3.3 XOMA XOMA 5.82 1.00 20.75 23.00 3.96 -63.0 Gilat Satellite Networks GILT 5.18 -0.89 -14.66 6.19 3.52 43.2
Mexico IPC All-Share 47391.24 –270.45 –0.57 3.8 Cellect Biotechnology ADR APOP 6.12 0.97 18.83 8.78 2.30 ... Tile Shop Holdings TTS 17.30 -2.70 -13.50 21.40 12.55 32.8
Chile Santiago IPSA 3361.34 –11.94 –0.35 4.3 InspireMD NSPR 2.67 0.41 18.14 23.70 1.41 -78.6 VistaGen Therapeutics VTGN 2.56 -0.35 -12.03 9.00 2.47 -68.0
0.02 China Natural Resources CHNR 2.53 0.35 16.06 5.73 0.75 197.6 Hibbett Sports HIBB 29.35 -3.90 -11.73 45.85 28.55 -11.1
Europe Stoxx Europe 600 370.20 0.07 2.4
Euro zone Euro Stoxx 355.26 0.48 0.14 1.4 RetailMeNot SALE 10.35 1.40 15.64 12.93 6.54 42.8 Oasmia Pharmaceutical ADR OASM 2.35 -0.31 -11.59 5.25 2.22 -26.5
Belgium Bel-20 3624.19 6.59 0.18 0.5 First NBC Bank Holding FNBC 4.50 0.60 15.38 27.20 3.30 -82.2 Capella Education CPLA 74.15 -9.50 -11.36 90.40 41.26 67.6
France CAC 40 4895.82 7.63 0.16 0.7 Cara Therapeutics CARA 15.53 2.02 14.95 17.20 4.26 107.9 Galmed Pharmaceuticals GLMD 4.15 -0.51 -10.94 7.72 2.78 -18.0
Germany DAX 11771.81 –2.62 –0.02 2.5 Scorpio Tankers STNG 4.47 0.51 12.88 6.70 3.50 -18.4 Fenix Parts FENX 2.36 -0.29 -10.94 5.84 2.04 -51.9
1440.26 –0.02 –2.1 Himax Technologies ADR HIMX 6.05 0.68 12.66 12.00 4.88 -26.4 Dynatronics Corp. DYNT 2.55 -0.31 -10.86 3.21 2.29 -13.6
Israel Tel Aviv –0.31
Italy FTSE MIB 19187.67 123.03 0.65 –0.2
Netherlands AEX 494.62 0.57 0.12 2.4 Most Active Stocks Volume Movers Ranked by change from 65-day average*
Spain IBEX 35 9510.20 26.10 0.28 1.7
0.02 Volume % chg from Latest Session 52-Week Volume % chg from Latest Session 52-Week
Sweden SX All Share 555.95 0.11 4.0 Company Symbol (000) 65-day avg Close % chg High Low Company Symbol (000) 65-day avg Close % chg High Low
Switzerland Swiss Market 8426.15 –36.73 –0.43 2.5
Bank of America BAC 133,881 11.2 24.06 2.82 24.17 11.65 Reliv International RELV 1,400 7290 7.53 29.83 12.53 3.57
U.K. FTSE 100 7268.56 –10.36 –0.14 1.8
Finl Select Sector SPDR XLF 75,075 -7.3 24.33 1.16 24.36 16.61 PennantPark Floatg Rt Cap PFLT 4,816 4585 13.62 -2.78 14.22 10.51
Asia-Pacific DJ Asia-Pacific TSM 1509.88 –8.51 –0.56 6.1 Northern Dynasty Minerals NAK 65,039 1007.6 2.50 -21.38 3.45 0.28 Gilat Satellite Networks GILT 491 2087 5.18 -14.66 6.19 3.52
Australia S&P/ASX 200 5755.20 –5.50 –0.10 1.6 SPDR S&P 500 SPY 63,242 -22.7 233.70 0.40 233.71 187.63 Cynosure Cl A CYNO 13,460 1909 65.93 28.01 65.95 34.47
China Shanghai Composite 3217.93 1.09 0.03 3.7 VanEck Vectors Gold Miner GDX 53,321 -32.7 24.92 -0.12 31.79 17.20 My Size MYSZ 244 1289 7.88 -28.17 16.70 3.84
Hong Kong Hang Seng 23703.01 –7.97 –0.03 7.7 Direxion Jr Gold Bull 3X JNUG 51,412 11.2 11.86 3.40 33.29 3.77 Catalyst Biosciences CBIO 583 1136 7.83 -17.58 50.70 6.75
India S&P BSE Sensex 28339.31 –12.31 –0.04 6.4 iShares MSCI Emg Markets EEM 51,398 -11.8 38.38 0.10 38.38 29.67 Pulse Biosciences PLSE 351 949 12.11 2.28 12.90 4.03
Japan Nikkei Stock Avg 19238.98 –220.17 –1.13 0.7 DXN DLY GLDMNR 3x BL NUGT 51,033 -5.8 12.46 -0.24 35.80 5.51 Nomura Holdings ADR NMR 1,857 840 6.67 -1.33 6.80 3.33
Singapore Straits Times 3072.47 –39.16 –1.26 6.7 Micron Technology MU 49,940 88.3 23.12 -3.26 25.31 9.35 Fortress Invt Group Cl A FIG 7,981 815 6.21 6.52 6.36 4.02
South Korea Kospi 2074.57 –4.08 –0.20 2.4 iPath S&P 500 VIX ST Fut VXX 49,937 35.6 16.88 -4.31 112.24 16.86 Hibbett Sports HIBB 3,796 786 29.35 -11.73 45.85 28.55
Taiwan Weighted 9718.78 8.46 0.09 5.0 * Volumes of 100,000 shares or more are rounded to the nearest thousand * Common stocks priced at $5 a share or more with an average volume over 65 trading days of at least
Sources: SIX Financial Information; WSJ Market Data Group 5,000 shares =Has traded fewer than 65 days

CREDIT MARKETS Currencies CURRENCIES

U.S.-dollar foreign-exchange rates in late New York trading
Consumer Rates and Returns to Investor Benchmark
Treasury Yields
yield curve Forex Race US$vs, US$vs,
andtoRates
Yield maturity of current bills, Yen, euro vs. dollar; dollar vs. Country/currency
Tues YTDchg
in US$ per US$ (%) Country/currency
Tues YTDchg
in US$ per US$ (%)
U.S. consumer rates Selected rates notes and bonds major U.S. trading partners
Americas Thailand baht .02856 35.020 –2.2
A consumer rate against its 5-year CDs Vietnam dong .00004405 22700 –0.3
5.00% Argentina peso .0646 15.4768 –2.5
benchmark over the past year 18% Brazil real .3241 3.0850 –5.2 Europe
Bankrate.com avg†: 1.24%
4.00 Canada dollar .7650 1.3073 –2.7 Czech Rep. koruna .03915 25.544 –0.6
First Internet Bank of Indiana 2.07% 12
.001561 640.50 .1422 7.0300
s
Chile peso –4.4 Denmark krone –0.6
Five-year CD yields 1.50% Indianapolis, IN 888-873-3424 3.00 6 Yen Colombia peso .0003481 2872.53 –4.3 Euro area euro 1.0579 .9453 –0.6
t
Pentagon Federal Credit Union 2.17% Euro
s Ecuador US dollar 1 1 unch Hungary forint .003434 291.17 –1.1
1.00 Tuesday 2.00
t

Alexandria, VA 800-247-5626 0 Mexico peso .0494 20.2587 –2.3 Iceland krona .008872 112.72 –0.2
Federal-funds Peru new sol .3066 3.262 –2.7 Norway krone .1191 8.3995 –2.8
target rate 0.50 Popular Direct 2.28% 1.00 –6 s Uruguay peso .03505 28.5300 –2.8 Poland zloty .2458 4.0692 –2.8
t One year ago
t

New York, NY 800-274-5696 WSJ Dollar index Venezuela b. fuerte .100150 9.9851 –0.1 Russia ruble .01753 57.058 –6.9
0.00 0.00 –12
EverBank 2.30% Asia-Pacific Sweden krona .1119 8.9342 –1.9
1 3 6 1 2 3 5 710 30 2016 2017 Switzerland franc .9936 1.0064 –1.2
Jacksonville, FL 855-228-6755 Australian dollar .7663 1.3050 –6.0
–0.50 month(s) years Turkey lira .2740 3.6503 3.6
State Farm Bank 2.30% China yuan .1456 6.8668 –1.1
MAM J J A S O N D J F maturity Ukraine hryvnia .0368 27.1500 0.2
Hong Kong dollar .1289 7.7597 0.1
2016 2017 Bloomington, IL 877-734-2265 UK pound 1.2467 .8021 –1.0
India rupee .01496 66.830 –1.7
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group Middle East/Africa
Indonesia rupiah .0000750 13326 –1.5
Yield/Rate (%) 52-Week Range (%) 3-yr chg Japan yen .008752 114.26 –2.3 Bahrain dinar 2.6525 .3770 –0.05
Interest rate Last (l)Week ago Low 0 2 4 6 8 High (pct pts)
Kazakhstan tenge .003106 321.94 –3.5 Egypt pound .0606 16.4975 –9.0
Federal-funds rate target 0.50-.75 0.50-.75 0.25 l 0.75 0.50 Corporate Borrowing Rates and Yields Macau pataca .1246 8.0289 1.4 Israel shekel .2668 3.7478 –2.6
Malaysia ringgit .2247 4.4500 –0.8 Kuwait dinar 3.2751 .3053 –0.1
Prime rate* 3.75 3.75 3.50 l 3.75 0.50 Yield (%) 52-Week Total Return (%)
Bond total return index Close Last Week ago High Low 52-wk 3-yr New Zealand dollar .7169 1.3949 –3.4 Oman sul rial 2.5968 .3851 0.03
Libor, 3-month 1.04 1.04 0.62 l 1.04 0.80 Pakistan rupee .00954 104.825 0.4 Qatar rial .2746 3.642 0.04
Money market, annual yield 0.31 0.31 0.22 l 0.32 -0.10 Treasury, Ryan ALM 1424.942 2.090 2.005 2.186 1.141 –2.390 2.741 Philippines peso .0200 49.952 0.7 Saudi Arabia riyal .2666 3.7504 –0.01
Five-year CD, annual yield 1.24 1.22 1.17 l 1.32 -0.09 10-yr Treasury, Ryan ALM 1687.252 2.470 2.389 2.600 1.366 –0.539 2.940 Singapore dollar .7038 1.4208 –1.8 South Africa rand .0763 13.1064 –4.3
30-year mortgage, fixed† 4.11 4.13 3.43 l 4.29 -0.26 South Korea won .0008780 1138.90 –5.7
DJ Corporate 361.614 3.255 3.190 3.410 2.460 5.504 3.801 Close Net Chg % Chg YTD%Chg
Sri Lanka rupee .0066423 150.55 1.4
15-year mortgage, fixed† 3.29 3.31 2.70 l 3.50 -0.11 Aggregate, Barclays Capital 1880.410 2.640 2.570 2.770 1.820 1.055 2.607 Taiwan dollar .03254 30.735 –5.3 WSJ Dollar Index 91.26 0.11 0.13 –1.80
Jumbo mortgages, $424,100-plus† 4.38 4.41 4.02 l 4.88 -0.11 High Yield 100, Merrill Lynch 2738.643 5.315 5.441 8.341 5.248 19.826 3.435 Sources: Tullett Prebon, WSJ Market Data Group
Five-year adj mortgage (ARM)† 3.38 3.41 2.97 l 4.03 -0.21
Fixed-Rate MBS, Barclays 1938.780 2.890 2.860 3.070 1.930 0.177 2.613
New-car loan, 48-month 3.17 3.16 2.87 l 3.38 0.26
HELOC, $30,000 4.69 4.70 4.29 l 4.84 -0.45
Muni Master, Merrill 502.081 2.174 2.135 2.516 1.297 –1.028 2.944 COMMODITIES
Bankrate.com rates based on survey of over 4,800 online banks. *Base rate posted by 70% of the nation's largest EMBI Global, J.P. Morgan 760.369 5.739 5.802 6.924 5.134 13.985 6.506 Commodities Tuesday 52-Week YTD
banks.† Excludes closing costs. Pricing trends on someClose
raw materials, or commodities
Sources: SIX Financial Information; WSJ Market Data Group; Bankrate.com Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch Net chg % Chg High Low % Chg % chg

DJ Commodity 585.56 -0.63 -0.11 589.81 441.11 32.74 3.23

ONLINE 192.28 0.11 195.82 21.03 -0.12

WSJ
TR/CC CRB Index 0.22 158.87
Crude oil, $ per barrel 53.20 0.27 0.51 54.06 29.04 83.20 -0.97
Real-time U.S. stock quotes are available on WSJ.com. Track most-active stocks, new highs/lows, mutual funds and ETFs. Natural gas, $/MMBtu 2.905 -0.039 -1.32 3.93 1.64 52.65 -21.99
.COM
Plus, get deeper money-flows data and email delivery of key stock-market data. All are available free at WSJMarkets.com Gold, $ per troy oz. 1223.90 -0.50 -0.04 1364.90 1127.80 1.32 6.43
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
THE WALL STREET JOURNAL. Wednesday, February 15, 2017 | B13

COMMODITIES WSJ.com/commodities

Futures Contracts Open

Contract
High hilo Low Settle Chg
Open
interest Open
Contract
High hilo Low Settle Chg
Open
interest Open
Contract
High hilo Low Settle Chg
Open
interest

Metal & Petroleum Futures July 3.215 3.247 3.194 3.217 –.023 99,101 Milk (CME)-200,000 lbs., cents per lb.
Oct 3.239 3.267 3.222 3.241 –.023 97,389 Feb 16.87 16.88 16.86 16.88 .01 4,179 Currency Futures
Contract Open March 16.79 16.97 16.76 16.91 .07 4,429
Open High hi lo Low Settle Chg interest Agriculture Futures Cocoa (ICE-US)-10 metric tons; $ per ton. Japanese Yen (CME)-¥12,500,000; $ per 100¥
Copper-High (CMX)-25,000 lbs.; $ per lb. March .8797 .8837 .8740 .8764 –.0043 192,126
March 1,889 1,969 1,889 1,929 40 636
Corn (CBT)-5,000 bu.; cents per bu. June .8835 .8875 .8779 .8803 –.0044 9,657
Feb 2.7560 2.7600 2.7370 2.7310 –0.0455 459 May 1,907 1,943 t 1,893 1,905 –20 131,759
March 2.7855 2.8145 2.7135 2.7370 –0.0460 105,239 March 375.00 375.25 373.00 374.25 –1.25 404,228 Coffee (ICE-US)-37,500 lbs.; cents per lb. Canadian Dollar (CME)-CAD 100,000; $ per CAD
May 382.25 382.50 380.25 381.75 –1.00 475,047 March .7653 .7680 .7631 .7650 –.0004 120,981
Gold (CMX)-100 troy oz.; $ per troy oz. March 144.75 145.80 142.50 143.65 –.60 18,513
June .7663 .7686 .7639 .7658 –.0004 2,901
Feb 1225.90 1233.50 1222.10 1223.90 –0.50 1,077 Oats (CBT)-5,000 bu.; cents per bu. May 146.85 148.00 144.80 145.95 –.60 89,627
March 253.00 256.00 252.50 254.00 –.75 3,671 British Pound (CME)-£62,500; $ per £
April 1226.10 1236.00 1222.70 1225.40 –0.40 269,091 Sugar-World (ICE-US)-112,000 lbs.; cents per lb. March 1.2532 1.2555 1.2449 1.2471 –.0062 207,783
June 1229.60 1238.90 1226.20 1228.60 –0.30 65,180 May 251.75 256.50 250.75 254.00 3.50 3,671 March 20.04 20.52 20.04 20.47 .47 165,590
Soybeans (CBT)-5,000 bu.; cents per bu. June 1.2560 1.2582 1.2479 1.2501 –.0061 1,712
Aug 1234.50 1242.00 1229.50 1231.80 –0.30 19,040 May 20.00 20.43 20.00 20.37 .38 275,518 Swiss Franc (CME)-CHF 125,000; $ per CHF
Dec 1239.90 1248.20 1236.40 1238.00 –0.20 29,810 March 1055.00 1056.00 1042.50 1045.00 –9.25 204,777 Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb. March .9951 .9981 .9929 .9944 –.0013 47,572
Feb'18 1246.60 1250.50 1246.60 1241.30 –0.10 4,596 May 1065.75 1067.00 1053.50 1056.00 –9.75 280,912 May 30.40 30.40 30.40 30.30 .07 947 June 1.0023 1.0039 .9990 1.0003 –.0013 217
Palladium (NYM) - 50 troy oz.; $ per troy oz. Soybean Meal (CBT)-100 tons; $ per ton. July 30.30 30.39 30.30 30.39 .10 1,795 Australian Dollar (CME)-AUD 100,000; $ per AUD
Feb 732.85 732.85 732.85 780.95 5.95 1 March 343.80 343.80 338.80 339.50 –3.70 85,252 Cotton (ICE-US)-50,000 lbs.; cents per lb. March .7634 .7692 s .7613 .7648 .0008 121,733
March 775.00 784.90 773.65 780.90 5.95 20,242 May 348.20 348.40 343.20 343.90 –3.90 163,255 March 76.65 76.73 75.90 76.32 –.29 54,492 June .7623 .7674 s .7598 .7631 .0008 1,339
April 778.25 781.40 777.65 781.65 6.05 12 Soybean Oil (CBT)-60,000 lbs.; cents per lb. May 78.04 78.37 77.52 77.95 –.26 138,065 Sept .7623 .7664 s .7600 .7619 .0008 689
June 776.00 785.45 776.00 782.20 5.85 10,074 March 34.21 34.32 33.75 34.14 –.03 93,692 Orange Juice (ICE-US)-15,000 lbs.; cents per lb. Mexican Peso (CME)-MXN 500,000; $ per MXN
Sept 783.20 783.90 780.55 783.45 6.10 21 May 34.45 34.60 34.02 34.41 –.03 141,089 March 167.20 173.00 167.20 170.00 2.90 6,211 March .04910 .04929 s .04876 .04912 .00012 140,966
Platinum (NYM)-50 troy oz.; $ per troy oz. Rough Rice (CBT)-2,000 cwt.; $ per cwt. May 165.00 169.50 165.00 165.85 1.05 4,176 June … .04859 s .04807 .04840 .00012 48,016
Feb 978.80 979.10 978.80 1000.10 1.90 42 March 948.00 952.00 941.00 943.50 –5.00 8,199 Euro (CME)-€125,000; $ per €
April 1001.10 1011.90 998.70 1002.20 1.90 58,801 May 973.50 975.50 966.50 968.00 –5.00 3,559 Interest Rate Futures March 1.0606 1.0644 1.0571 1.0583 –.0027 396,272
Silver (CMX)-5,000 troy oz.; $ per troy oz. Wheat (CBT)-5,000 bu.; cents per bu. June 1.0654 1.0694 1.0622 1.0634 –.0027 10,946
Feb 17.950 17.960 17.930 17.872 0.068 124 March 450.50 452.00 446.25 449.50 –2.75 135,302 Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
March 17.810 18.090 s 17.730 17.889 0.068 97,499 May 464.75 466.00 460.00 463.50 –3.50 172,731 March 151-100 151-170 149-290 150-200 –24.0 628,110 Index Futures
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl. Wheat (KC)-5,000 bu.; cents per bu. June 150-030 150-090 148-210 149-120 –24.0 6,289
March 52.91 53.72 52.86 53.20 0.27 241,481 March 465.75 467.00 461.25 465.25 –1.50 48,545 Treasury Notes (CBT)-$100,000; pts 32nds of 100% Mini DJ Industrial Average (CBT)-$5 x index
May 478.00 479.50 473.75 478.00 –1.50 83,452 March 20382 20496 s 20346 20482 99 127,639
April 53.42 54.19 53.36 53.71 0.28 398,162 March 124-175 124-200 123-310 124-075 –11.5 3,210,911 June 20326 20432 s 20286 20420 98 1,049
May 53.84 54.58 53.78 54.12 0.26 225,381 Wheat (MPLS)-5,000 bu.; cents per bu. June 124-000 124-025 123-130 123-220 –11.5 106,038
March 569.50 570.25 565.75 568.25 –2.50 22,446 S&P 500 Index (CME)-$250 x index
June 54.22 54.95 54.15 54.48 0.23 257,909 5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100% March 2325.50 2337.50 s 2320.00 2337.00 10.70 70,331
July 54.56 55.22 54.46 54.78 0.22 112,121 May 569.50 570.00 564.75 568.00 –2.50 33,149
March 117-272 117-290 117-155 117-202 –8.0 3,082,403 June 2327.00 2332.20 s 2315.20 2332.10 10.90 1,399
Dec 55.16 55.80 55.05 55.35 0.18 229,060 Cattle-Feeder (CME)-50,000 lbs.; cents per lb. Mini S&P 500 (CME)-$50 x index
March 121.825 124.150 121.675 124.000 2.175 17,486 June 117-162 117-175 117-037 117-085 –8.5 204,635
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal. 2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100% March 2326.50 2337.75 s 2319.75 2337.00 10.75 2,938,992
March 1.6264 1.6559 1.6238 1.6382 .0109 97,216 April 122.000 124.025 121.775 123.900 1.925 13,257
March 108-130 108-135 108-100 108-110 –2.2 1,402,040 June 2321.75 2333.00 s 2315.00 2332.00 10.75 53,301
April 1.6369 1.6666 1.6347 1.6496 .0113 84,339 Cattle-Live (CME)-40,000 lbs.; cents per lb. Mini S&P Midcap 400 (CME)-$100 x index
Feb 115.975 117.400 115.575 117.375 1.450 12,997 June 108-030 108-037 108-000 108-010 –2.7 11,670
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal. March 1723.70 1731.10 s 1716.00 1727.80 4.30 94,603
March 1.5450 1.5759 1.5339 1.5467 .0021 77,623 April 112.500 114.075 112.200 114.000 1.475 137,751 30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg. June 1717.10 1726.80 s 1715.20 1725.30 4.30 20
April 1.7550 1.7876 1.7532 1.7650 .0049 98,135 Hogs-Lean (CME)-40,000 lbs.; cents per lb. Feb 99.343 99.345 99.343 99.342 –.001 100,521 Mini Nasdaq 100 (CME)-$20 x index
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu. Feb 74.950 75.200 s 74.950 75.175 .425 13,058 April 99.300 99.305 99.280 99.290 –.010 396,275 March 5259.3 5278.0 s 5239.8 5276.0 16.8 229,745
March 2.923 2.953 t 2.887 2.905 –.039 137,001 April 70.000 71.625 70.000 71.300 1.600 102,636 10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100% June 5259.3 5277.0 s 5239.8 5275.3 16.8 1,064
April 3.006 3.047 t 2.986 3.005 –.027 195,851 Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft. March 93.938 94.000 93.328 93.703 –.313 31,653 Mini Russell 2000 (ICE-US)-$100 x index
May 3.079 3.120 t 3.061 3.084 –.024 176,022 March 365.00 369.80 364.00 365.40 … 2,444 1 Month Libor (CME)-$3,000,000; pts of 100% March 1390.40 1398.80 1383.70 1398.50 6.20 620,820
June 3.152 3.186 t 3.132 3.153 –.022 72,469 May 367.50 374.90 367.40 369.90 1.00 1,997 March 99.1850 99.1850 99.1825 99.1825 –.0100 20 June 1385.50 1393.30 1383.30 1396.50 6.20 603
April 99.1450 99.1450 99.1275 99.1275 –.0150 255 Mini Russell 1000 (ICE-US)-$100 x index
March 1290.10 1296.80 s 1288.60 1298.20 5.20 7,817
Eurodollar (CME)-$1,000,000; pts of 100% U.S. Dollar Index (ICE-US)-$1,000 x index
March 98.9250 98.9275 98.9025 98.9100 –.0125 1,460,579
Cash Prices | WSJ.com/commodities Tuesday, February 14, 2017 June
Sept
98.7550
98.6350
98.7600
98.6350
98.7250
98.5850
98.7400
98.6050
–.0150
–.0250
1,435,191
1,146,311
March
June
100.95
100.91
101.39
101.29
100.70
100.65
101.23
101.15
.28
.26
70,046
2,918

These prices reflect buying and selling of a variety of actual or “physical” commodities in the marketplace— Dec 98.4800 98.4850 98.4250 98.4450 –.0350 1,306,034 Source: SIX Financial Information
separate from the futures price on an exchange, which reflects what the commodity might be worth in future
months.
Tuesday Tuesday Tuesday Bonds | WSJ.com/bonds
Coins,wholesale $1,000 face-a 13948 Soybeans,No.1 yllw IL-bp,u 10.1350
Energy
Other metals Wheat,Spring14%-pro Mnpls-u 6.6300 Tracking Bond Benchmarks
Propane,tet,Mont Belvieu-g 0.7851 LBMA Platinum Price PM *999.0 Wheat,No.2 soft red,St.Louis-bp,u 4.4950
Butane,normal,Mont Belvieu-g 1.2297 Wheat - Hard - KC (USDA) $ per bu-u 4.1525 Return on investment and spreads over Treasurys and/or yields paid to investors compared with 52-week
Platinum,Engelhard industrial 1006.0
NaturalGas,HenryHub-i 2.860 Platinum,Engelhard fabricated 1106.0 Wheat,No.1soft white,Portld,OR-u 4.8725 highs and lows for different types of bonds
NaturalGas,TranscoZone3-i 2.800 Palladium,Engelhard industrial 786.0 Total Total
NaturalGas,TranscoZone6NY-i 2.880
Food return YTD total Yield (%) return YTD total Yield (%)
Palladium,Engelhard fabricated 886.0
NaturalGas,PanhandleEast-i 2.650 Beef,carcass equiv. index close return (%) Index Latest Low High close return (%) Index Latest Low High
Aluminum, LME, $ per metric ton *1867.5
NaturalGas,Opal-i 2.660 choice 1-3,600-900 lbs.-u 176.13 Mortgage-Backed Bloomberg Barclays
Copper,Comex spot 2.7310 Broad Market Bloomberg Barclays
NaturalGas,MarcellusNE PA-i 2.490 select 1-3,600-900 lbs.-u 173.51
Iron Ore, 62% Fe CFR China-s 91.0 1938.78 -0.03
NaturalGas,HaynesvilleN.LA-i 2.740 Broilers,dressed 'A'-u n.a. 1880.41 0.2 U.S. Aggregate 2.640 1.820 2.770 Mortgage-Backed 2.890 1.930 3.070
Shredded Scrap, US Midwest-s,w 282
Coal,C.Aplc.,12500Btu,1.2SO2-r,w 50.050 Broilers, National comp wghtd-u,w 0.8468 1919.15 0.1 Ginnie Mae (GNMA) 2.820 1.850 2.990
Steel, HRC USA, FOB Midwest Mill-s 625 U.S. Corporate Indexes Bloomberg Barclays
Coal,PwdrRvrBsn,8800Btu,0.8SO2-r,w 11.800 Butter,AA Chicago 2.1300
Fibers and Textiles Cheddar cheese,bbl,Chicago 165.00 2638.28 0.4 U.S. Corporate 3.380 2.750 3.710 1133.42 -0.1 Fannie mae (FNMA) 2.900 1.950 3.090
Metals
Cheddar cheese,blk,Chicago 161.00
Burlap,10-oz,40-inch NY yd-n,w 0.5825 2531.41 0.5 Intermediate 2.850 2.190 3.110 1745.21 -0.1 Freddie Mac (FHLMC) 2.920 1.980 3.110
Gold, per troy oz Milk,Nonfat dry,Chicago lb. 90.25
Cotton,1 1/16 std lw-mdMphs-u 0.7507 0.6
Engelhard industrial 1236.25 Cocoa,Ivory Coast-w n.a. 3517.20 0.3 Long term 4.550 3.960 5.130 502.08 Muni Master 2.174 1.297 2.516
Cotlook 'A' Index-t *85.65 1.4496
Engelhard fabricated 1328.97 Coffee,Brazilian,Comp
Hides,hvy native steers piece fob-u 75.000 542.33 0.3 Double-A-rated 2.750 1.980 2.870 349.07 0.5 7-12 year 2.278 1.300 2.618
Handy & Harman base 1230.75 Coffee,Colombian, NY 1.6303
1366.13 Wool,64s,staple,Terr del-u,w n.a. 0.6050
Handy & Harman fabricated Eggs,large white,Chicago-u 674.31 0.6 Triple-B-rated 3.710 3.180 4.430 387.27 0.4 12-22 year 2.739 1.610 3.047
LBMA Gold Price AM *1229.40 Grains and Feeds Flour,hard winter KC 14.35
LBMA Gold Price PM *1222.25 Hams,17-20 lbs,Mid-US fob-u n.a. High Yield Bonds Merrill Lynch 372.68 0.4 22-plus year 3.337 2.027 3.622
Krugerrand,wholesale-e 1273.43 Barley,top-quality Mnpls-u n.a. Hogs,Iowa-So. Minnesota-u 72.17 Global Government J.P. Morgan†
396.62 2.1 High Yield Constrained 5.760 5.760 9.781
Maple Leaf-e 1285.67 Bran,wheat middlings, KC-u 74 Pork bellies,12-14 lb MidUS-u n.a.
American Eagle-e 1285.67 Corn,No. 2 yellow,Cent IL-bp,u 3.5550 Pork loins,13-19 lb MidUS-u 0.8964 398.11 3.5 Triple-C-rated 9.982 9.982 21.231 532.59 -0.8 Global Government 1.510 0.750 1.520
Mexican peso-e 1484.32 Corn gluten feed,Midwest-u,w 92.8 Steers,Tex.-Okla. Choice-u n.a. 750.19 -0.4
2738.64 2.1 High Yield 100 5.315 5.248 8.341 Canada 1.950 0.770 1.980
Austria crown-e 1203.21 Corn gluten meal,Midwest-u,w 520.1 Steers,feeder,Okla. City-u,w 150.29
Austria phil-e 1285.67 Cottonseed meal-u,w 225 359.80 2.2 Global High Yield Constrained 5.404 5.404 9.238 361.41 -2.0 EMU§ 1.267 0.512 1.322
Hominy feed,Cent IL-u,w 85 Fats and Oils
Silver, troy oz. 290.52 1.2 Europe High Yield Constrained 3.022 3.022 6.500 686.62 -2.8 France 1.140 0.270 1.190
Engelhard industrial 18.0200 Meat-bonemeal,50% pro Mnpls-u,w 288 Corn oil,crude wet/dry mill-u,w 37.7500
Engelhard fabricated 21.6240 Oats,No.2 milling,Mnpls-u 2.9400 Grease,choice white,Chicago-u 0.2750 U.S Agency Bloomberg Barclays 509.79 -0.9 Germany 0.380 -0.100 0.490
Handy & Harman base 17.8950 Rice, 5% Broken White, Thailand-l,w 344.00 Lard,Chicago-u n.a. 0.3
1608.78 U.S Agency 1.790 1.150 1.910 285.30 -1.0 Japan 0.450 -0.120 0.470
Handy & Harman fabricated 22.3690 Rice, Long Grain Milled, No. 2 AR-u,w 20.63 Soybean oil,crude;Centl IL-u 0.3249
LBMA spot price £14.3677 Sorghum,(Milo) No.2 Gulf-u 7.2200 Tallow,bleach;Chicago-u 0.3125 1449.28 0.2 10-20 years 1.580 0.960 1.710 557.52 -1.5 Netherlands 0.610 0.020 0.680
(U.S.$ equivalent) 17.9050 SoybeanMeal,Cent IL,rail,ton48%-u 336.50 Tallow,edible,Chicago-u 0.3450
3144.93 0.8 20-plus years 3.270 2.390 3.460 902.57 -1.2 U.K. 1.650 0.960 2.060
2358.08 0.7 Yankee 2.910 2.320 3.090 760.37 2.9 Emerging Markets ** 5.739 5.134 6.924
KEY TO CODES: A=ask; B=bid; BP=country elevator bids to producers; C=corrected; E=Manfra,Tordella & Brooks; G=ICE; I=Natural Gas Intelligence; *Constrained indexes limit individual issuer concentrations to 2%; the High Yield 100 are the 100 largest bonds † In local currency § Euro-zone bonds
L=livericeindex.com; M=midday; N=nominal; n.a.=not quoted or not available; R=SNL Energy; S=The Steel Index; T=Cotlook Limited; U=USDA; W=weekly, Z=not quoted.
*Data as of 2/13 ** EMBI Global Index Sources: Merrill Lynch; Bloomberg Barclays; J.P.Morgan
Source: WSJ Market Data Group

Global Government Bonds: Mapping Yields

Borrowing Benchmarks | WSJ.com/bonds Yields and spreads over or under U.S. Treasurys on benchmark two-year and 10-year government bonds in
Money Rates February 14, 2017 selected other countries; arrows indicate whether the yield rose(s) or fell (t) in the latest session
Country/ Yield (%) Spread Under/Over U.S. Treasurys, in basis points
Key annual interest rates paid to borrow or lend money in U.S. and international markets. Rates below are a Coupon (%) Maturity, in years Latest(l) 0 20 40 60 80 100 120 Previous Month ago Year ago Latest Prev Year ago
guide to general levels but don’t always represent actual transactions. 1.125 U.S. 2 1.242 s l 1.206 1.197 0.710
Week —52-WEEK— Week —52-WEEK— 2.250 10 2.470 s l 2.433 2.397 1.748
Inflation Latest ago High Low Latest ago High Low 5.250 Australia 2 1.841 s l 1.809 1.864 1.807 59.9 60.3 109.7
Dec. index Chg From (%)
level Nov. '16 Dec. '15 Secondary market 4.750 10 2.748 s l 2.712 2.700 2.430 27.8 27.8 68.2
Overnight repurchase
U.S. 0.57 0.57 1.30 0.15 Fannie Mae 0.000 France 2 -0.507 t l -0.504 -0.593 -0.392 -174.9 -171.0 -110.1
U.S. consumer price index
All items 241.432 0.03 2.1 30-year mortgage yields 0.250 10 1.054 s l 1.026 0.810 0.670 -141.6 -140.7 -107.8
U.S. government rates
Core 249.134 –0.04 2.2 30 days 3.662 3.644 3.828 2.806 0.000 Germany 2 -0.797 t l -0.790 -0.716 -0.498 -203.9 -199.6 -120.7
Discount 60 days 3.694 3.676 3.862 2.832
International rates 0.250 10 0.370 s l 0.335 0.342 0.262 -210.0 -209.8 -148.6
1.25 1.25 1.25 1.00
Other short-term rates 0.300 Italy 2 -0.034 t l -0.009 -0.093 0.088 -127.7 -121.4 -62.2
Week 52-Week
Latest High Low Federal funds 1.250 10 2.230 s l 2.227 1.903 1.638 -20.6 -11.0
ago Week 52-Week -24.0
Effective rate 0.6800 0.6800 0.7000 0.2700 Latest ago high low
Prime rates 0.8125 0.8125 0.5600
0.100 Japan 2 -0.220 t l -0.210 -0.219 -0.168 -146.3 -141.5 -87.8
High 0.8125
U.S. 3.75 3.75 3.75 3.50 Low 0.6000 0.5000 0.6600 0.2000 Call money 0.100 10 0.097 s l 0.091 0.052 0.076 -237.3 -234.2 -167.2
Canada 2.70 2.70 2.70 2.70 Bid 0.6600 0.6600 0.6800 0.2000 2.50 2.50 2.50 2.25 0.250 Spain 2 -0.284 t l -0.277 -0.294 0.089 -152.7 -148.3 -62.1
Japan 1.475 1.475 1.475 1.475 Offer 0.6800 0.6800 0.7500 0.2600 Commercial paper 1.300 10 1.670 s l 1.662 1.433 1.736 -80.0 -77.1 -1.2
Policy Rates 30 to 270 days n.q. ... ... ...
Treasury bill auction 1.250 U.K. 2 0.125 s l 0.114 0.176 0.392 -111.8 -109.2 -31.8
Euro zone 0.00 0.00 0.05 0.00
Switzerland 0.50 0.50 0.50 0.50 4 weeks 0.515 0.530 0.530 0.160 Commercial paper (AA financial) 4.250 10 1.408 s l 1.392 1.460 1.418 -106.2 -104.1 -33.0
Britain 0.25 0.25 0.50 0.25 13 weeks 0.540 0.530 0.555 0.220 90 days 0.87 0.91 1.03 0.45
Source: Tullett Prebon
Australia 1.50 1.50 2.00 1.50 26 weeks 0.645 0.620 0.660 0.340
Euro commercial paper Corporate Debt
30 day n.q. n.q. -0.13 -0.14 Price moves by a company’s debt in the credit markets sometimes mirror and sometimes anticipate moves in
Exchange-Traded Portfolios | WSJ.com/ETFresearch Two month n.q. n.q. n.q. n.q.
that same company’s share price. Here’s a look at both for two companies in the news.
Three month n.q. n.q. n.q. n.q.
Largest 100 exchange-traded funds, latest session Four month n.q. n.q. n.q. n.q. Investment-grade spreads that tightened the most…
Five month n.q. n.q. n.q. n.q. Spread*, in basis points Stock Performance
Closing Chg YTD Issuer Symbol Coupon (%) Maturity Current One-day change Last week Close ($) % chg
Tuesday, February 14, 2017 Six month n.q. n.q. n.q. n.q.
ETF Symbol Price (%) (%)
Closing Chg YTD Citigroup C 6.300 May 15, ’49 226 –30 267 59.83 1.49
ETF Symbol Price (%) (%) iShUSPfdStk PFF 38.50 ... 3.5 Libor
Santander Issuances Sau SANTAN 5.179 Nov. 19, ’25 240 –24 265 ... ...
AlerianMLPETF AMLP 13.10 0.54 4.0 iSh1-3YTreasuryBd SHY 84.45 –0.07 ... One month 0.77000 0.77278 0.78000 0.42830
iSh7-10YTreasuryBd IEF 104.69 –0.36 –0.1
Mylan MYL 4.200 Nov. 29, ’23 196 –17 213 40.75 2.44
CnsmrDiscSelSector XLY 86.32 0.57 6.0 Three month 1.03733 1.03817 1.04344 0.61820
CnsStapleSelSector XLP 53.63 0.02 3.7 iShRussellMCGrowth IWP 103.07 0.21 5.8 Bank of America BAC 8.000 Jan. 30, ’49 61 –16 98 24.06 2.82
Six month 1.33656 1.34350 1.36183 0.86585
DBGoldDoubleLgETN DGP 22.77 0.40 13.2 PwrShrs QQQ QQQ 128.53 0.34 8.5
One year 1.70789 1.70511 1.73289 1.13215
Shell International Finance BV RDSALN 2.375 Aug. 21, ’22 66 –16 79 ... ...
PS SP500LoVoltlPrt SPLV 42.50 –0.09 2.2
DBGoldDoubleShrt DZZ 5.99 –0.17 –12.6 Verizon Communications VZ 2.625 Feb. 21, ’20 70 –14 89 48.27 –0.58
DeutscheXMSCIEAFE DBEF 28.92 0.14 3.1 PwrShSrLoanPtf BKLN 23.28 –0.04 –0.3
SPDRBloomBarcHYBd JNK 36.99 0.14 1.5
Euro Libor General Electric GE 4.625 Jan. 7, ’21 27 –13 30 30.28 0.80
EnSelectSectorSPDR XLE 73.66 0.33 –2.2
SchwIntlEqty SCHF 29.03 –0.10 4.9 One month -0.394 -0.394 -0.253 -0.394 Total Capital International TOTAL 2.100 June 19, ’19 47 –13 60 ... ...
FinSelSectorSPDR XLF 24.33 1.16 4.6
90.51 0.27 4.5 SchwUS BrdMkt SCHB 56.70 0.39 4.7 Three month -0.350 -0.350 -0.207 -0.350
GuggenheimSP500EqW
HealthCareSelSect
RSP
XLV 72.87 0.79 5.7 SchwUS LrgCap SCHX 55.82 0.43 4.8 Six month -0.247 -0.247 -0.124 -0.248
…And spreads that widened the most
SPDR DJIA Tr DIA 205.17 0.48 3.9
IndSelSectorSPDR XLI 65.41 0.05 5.1 One year -0.109 -0.108 -0.005 -0.110 Apache APA 3.250 April 15, ’22 99 9 n.a. 55.50 –2.94
108.50 –0.12 0.3 SPDR GldTr GLD 116.93 0.11 6.7
iShIntermCredBd CIU
SPDR S&PMdCpTr MDY 314.60 0.28 4.3
Crown Castle Towers CCI 3.222 May 15, ’22 65 9 n.a. … …
iSh1-3YCreditBond CSJ 105.05 –0.02 0.1 Euro interbank offered rate (Euribor) JPMorgan Chase JPM 7.900 April 30, ’49 158 9 177 89.56 1.60
SPDR S&P 500 SPY 233.70 0.40 4.5
iSharesTIPSBondETF TIP 113.75 –0.24 0.5
SPDR S&P Div SDY 87.44 0.05 2.2 One month -0.374 -0.373 -0.245 -0.374 US Bank NA USB 2.125 Oct. 28, ’19 69 8 72 … …
iSh3-7YTreasuryBd IEI 122.48 –0.28 –0.0
TechSelectSector XLK 51.72 0.33 6.9 Three month -0.328 -0.328 -0.187 -0.329
iShCoreHiDividend HDV 82.81 0.15 0.7 Ford Motor Credit F 3.810 Jan. 9, ’24 161 7 157 … …
UtilitiesSelSector XLU 49.17 –0.73 1.2 Six month -0.241 -0.244 -0.120 -0.244
iShCoreMSCIEAFEETF IEFA 56.09 –0.14 4.6
118.73 1.16 10.4
Goldman Sachs GS 5.250 July 27, ’21 107 7 99 249.46 1.30
iShCoreMSCIEmgMk IEMG 46.54 0.04 9.6
VanEckBiotech BBH One year -0.104 -0.101 -0.001 -0.104
VanEckGoldMiner GDX 24.92 –0.12 19.1 Bpce S.A. BPCEGP 4.875 April 1, ’26 254 6 248 ... ...
iShCoreS&P500ETF IVV 235.14 0.40 4.5
VanEckOilSvcs OIH 33.74 1.57 1.2 Value 52-Week Credit Suisse AG CS 3.574 Jan. 9, ’23 175 5 172 15.06 1.69
iShCoreS&PMdCp IJH 172.47 0.28 4.3
VanEckPharm PPH 54.26 1.04 3.3 Latest Traded High Low
70.03 1.8
iShCoreS&PSmCpETF IJR
53.70
0.23
0.39 4.7
VanEckRetail RTH 78.67 0.78 3.8 High-yield issues with the biggest price increases…
iShS&PTotlUSStkMkt ITOT
VanEckSemiconduc SMH 75.74 –0.77 5.7 DTCC GCF Repo Index
iShCoreUSAggBd AGG 108.06 –0.22 ... Bond Price as % of face value Stock Performance
VangdInfoTech VGT 131.72 0.36 8.4 Treasury 0.582 42.240 1.266 0.244 Issuer Symbol Coupon (%) Maturity Current One-day change Last week Close ($) % chg
iShSelectDividend DVY 90.87 0.01 2.6
VangdSC Val VBR 124.82 0.32 3.2 MBS 0.599 90.550 1.328 0.257
iShEdgeMSCIMinUSA USMV 46.69 0.06 3.3
VangdDivApp VIG 88.71 0.28 4.1 Murray Energy MURREN 11.250 April 15, ’21 79.250 3.75 73.750 ... ...
iSharesGold IAU 11.82 0.08 6.7
VanguardFTSEDevMk VEA 38.38 –0.05 5.0 Open Implied Cascades CASCN 5.500 July 15, ’22 105.250 3.00 102.000 ... ...
iShiBoxx$InvGrCpBd LQD 117.20 –0.24 0.0 Settle Change Interest Rate
iShiBoxx$HYCpBd HYG 87.72 0.07 1.4
VanguardFTSEEmgMk VWO 39.12 0.15 9.3 Hexion HXN 9.000 Nov. 15, ’20 79.625 2.06 83.500 ... ...
VanguardFTSEEurope VGK 49.66 0.02 3.6 CNGHLD 9.375 May 15, ’20 2.00 85.375 ...
iSharesJPMUSDEmgBd EMB 113.01 –0.11 2.5 DTCC GCF Repo Index Futures Cng Holdings 88.000 ...
VanguardAWxUS VEU 46.70 –0.11 5.7
iShMBSETF MBB 106.34 –0.10 ... VangdGrowth VUG 119.01 0.35 6.8 Treasury Feb 99.405 unch. 9135 0.595 Valeant Pharmaceuticals International VRXCN 6.125 April 15, ’25 79.500 1.60 76.500 ... ...
iShMSCIACWIETF ACWI 62.15 0.21 5.0 Intelsat Jackson Holdings S.A. INTEL 5.500 Aug. 1, ’23 73.300 1.36 70.250 ... ...
VanguardHiDiv VYM 77.30 0.38 2.0 Treasury Mar 99.325 -0.015 4660 0.675
iSharesMSCIEAFESC SCZ 52.93 0.34 6.2 VanguardIntrm BIV 83.07 –0.30 ... Treasury Apr 99.285 -0.005 2578 0.715 Parker Drilling PKD 6.750 July 15, ’22 89.250 1.25 86.750 2.45 ...
iSharesMSCIEAFEETF EFA 60.29 –0.15 4.4 VangIntrCorpBd VCIT 85.82 –0.21 0.1
iShMSCIEmgMarkets EEM 38.38 0.10 9.6
Weatherford International WFT 8.250 June 15, ’23 106.750 1.06 107.500 6.15 1.15
VanguardLC VV 107.21 0.39 4.7
iShMSCIEurozoneETF EZU 35.49 0.23 2.6 Notes on data:
iShMSCIJapanETF EWJ 51.21 –0.72 4.8
VanguardMC
VanguardMCVal
VO
VOE
139.03
102.00
0.25
0.27
5.6
4.9 U.S. prime rate is effective December 15, 2016.
…And with the biggest price decreases
iShNasdaqBiotech IBB 289.80 1.22 9.2 VangdREIT VNQ 83.40 –0.52 1.1 Discount rate is effective December 15, 2016. Ally Financial ALLY 5.750 Nov. 20, ’25 104.500 –2.45 104.250 23.32 1.61
iShNatlAMTFrMuniBd MUB 108.08 –0.27 –0.1 U.S. prime rate is the base rate on corporate
VanguardS&P500 VOO 214.59 0.42 4.5
loans posted by at least 70% of the 10 largest Popular BPOP 7.000 July 1, ’19 105.000 –1.25 104.500 45.75 1.78
iShRussell1000Gwth IWF 111.46 0.37 6.3 VangdST Bond BSV 79.57 –0.09 0.2
iShRussell1000ETF IWB 130.31 0.39 4.7
U.S. banks; Other prime rates aren’t directly Denbury Resources DNR 5.500 May 1, ’22 83.000 –1.25 85.000 3.49 ...
VanguardSTCpBd VCSH 79.56 –0.08 0.2 comparable; lending practices vary widely by
iShRussell1000Val IWD 115.57 0.51 3.2 VanguardSC VB 134.30 0.31 4.1
Genon Energy GENONE 9.875 Oct. 15, ’20 74.125 –1.25 76.750 ... ...
location; DTCC GCF Repo Index is Depository
iShRussell2000Gwth IWO 160.59 0.22 4.3 VanguardTotBd BND 80.80 –0.21 0.0 Trust & Clearing Corp.'s weighted average for Cliffs Natural Resources CLF 6.250 Oct. 1, ’40 89.000 –1.00 n.a. 12.03 0.92
iShRussell2000ETF IWM 138.76 0.33 2.9 VanguardTotIntlBd BNDX 53.78 –0.06 –0.9 overnight trades in applicable CUSIPs. Value RR Donnelley & Sons RRD 8.820 April 15, ’31 98.506 –0.99 n.a. 17.96 0.17
iShRussell2000Val IWN 121.05 0.48 1.8 VanguardTtlIntlStk VXUS 48.55 –0.08 5.8 traded is in billions of U.S. dollars. Futures on the
DTCC GCF Repo Index are traded on NYSE Liffe Navient NAVI 7.250 Jan. 25, ’22 104.500 –0.88 105.375 15.79 0.83
iShRussell3000ETF IWV 139.07 0.40 4.6 VanguardTotStk VTI 120.58 0.37 4.6
iShRussellMid-Cap IWR 187.55 0.24 4.9 VangdTotlWrld VT 64.27 0.20 5.4
US. Range Resources RRC 5.875 July 1, ’22 103.625 –0.88 n.a. 32.81 0.86
83.69 0.22 4.1
Sources: Federal Reserve; Bureau of Labor
iShRussellMCValue IWS VangdValue VTV 95.75 0.47 2.9 *Estimated spread over 2-year, 3-year, 5-year, 10-year or 30-year hot-run Treasury; 100 basis points=one percentage pt.; change in spread shown is for Z-spread.
Statistics; DTCC; SIX Financial Information;
iShS&P500Growth IVW 128.78 0.31 5.7 WisdTrEuropeHdg HEDJ 59.14 0.54 3.0 General Electric Capital Corp.; Tullett Prebon Note: Data are for the most active issue of bonds with maturities of two years or more
iShS&P500ValueETF IVE 104.67 0.57 3.2 WisdTrJapanHdg DXJ 51.67 0.27 4.3 Information, Ltd. Sources: MarketAxess Corporate BondTicker; WSJ Market Data Group
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B14 | Wednesday, February 15, 2017
VALERY HACHE/AGENCE FRANCE-PRESSE/GETTY IMAGES
Foreign investors are worried that far-right leader Marine Le Pen, who wants to pull France out of the euro, is gaining ground.
Foreign Anxiety: ‘Frexit’
Weakening of French
government debt is a
sign that international
investors are retreating
BY MIKE BIRD
French government bonds
have steadily weakened ahead
of the country’s presidential
election this spring, but
French shares and corporate
bonds have mainly held up.
Panicked foreign investors
may help explain why.
Foreign-based investors
own almost two-thirds of the
government-bond market but
less than one-third of French-
listed stocks and nonfinancial
corporate bonds.
That has raised questions
over whether foreign investors
are cooling on France and
could back up recent evidence
that investors are more san-
guine about political risk in a
country in which they live.
The chief risk in France is
Marine Le Pen, the populist
leader who wants to pull
France out of the euro. She is
gaining ground in polls,
Traders Struggle to Gauge OPEC’s Production Cuts
BY GEORGI KANTCHEV
AND BENOIT FAUCON
Measuring the success of
OPEC’s production cuts has
never been harder.
Oil traders say they aren’t
just looking at the most recent
numbers from the Organiza-
tion of the Petroleum Export-
ing Countries showing it is
complying with its pledge to
cut almost 1.2 million barrels a
day from the global market.
Instead, they are watching for
$5
Recent trading range, between
$51 and $56 a barrel, of crude oil
signs that U.S. oil output is in-
creasing, that oil storage is
falling and that other big pro-
ducers like Russia are curtail-
ing flows of petroleum.
The complicated math has
helped put a cap on oil prices
and kept crude trading in a
roughly $5 band between $51
and $56 a barrel, following a
20% surge in prices after the
Nov. 30 OPEC deal.
The latest evidence of this
came Monday, when OPEC—
notorious for not following
through on its own agree-
Dividend Changes
Dividend announcements from February 14.
Company Symbol
Increased
Jack Henry & Associates
JKHY
Lear Corp LEA
QCR Holdings QCRH
Thomson Reuters TRI
Funds and investment companies
Master Income ETF HIPS
Source Capital SOR
VicSh Developed Enh Vol CIZ
VicSh US 500 Enh Vol Wtd CFO
VicSh US 500 Vol Wtd CFA
VicSh US Disc Enh Vol Wtd CSF
VicSh US EQ Incm Enh Vol CDC
though she is still a distant
second in France’s two-stage
election. International inves-
tors fret about the possibility
that Ms. Le Pen, the candidate
for the far-right National
Front party, will pull off a
Brexit-style surprise.
French debt maturing in 10
years now yields 0.7 percent-
age point more than the equiv-
alent German bond. That
spread has risen from as little
as 0.21 percentage point last
September and reached a four-
year high last week.
French stock investors are
confident that Ms. Le Pen will
lose to a mainstream candi-
date, according to Société Gé-
nérale SA. “Foreign investors
are less certain,” the bank said
in a recent research note.
While French sovereign-
bond yields have moved
higher against Germany’s,
French stocks are trading in
line with the rest of Europe.
Bond yields move inversely to
prices.
The French CAC-40 stock
index has risen by 8.9% in the
past six months, against an
8.2% rise for the broader Euro
Stoxx index.
ments—delivered an optimis-
tic report with numbers show-
ing almost full compliance
with its pledge. Oil prices fell
anyway, with Brent crude, the
global benchmark, dropping
2% on Monday.
The main reason for the de-
cline in prices on Monday,
traders and analysts say, is
that production increases
were baked into OPEC’s pact,
blunting the group’s ability to
force traders to draw down
the vast supplies of oil stored
in tanks across the world.
In 2009, when OPEC said it
would cut more than four mil-
lion barrels a day to stabilize
prices during the financial cri-
sis, there was only one excep-
tion: Iraq. This time, the
group’s agreement exempted
two big producers, Nigeria and
Libya, and allowed Iran to in-
crease a bit, too.
Including Nigerian and Lib-
yan output, BNP Paribas SA
put OPEC’s compliance rate at
77%, and if Nigerian output
keeps rising, that could fall to
63%, BNP said—about the
same level as in 2009. U.S. En-
ergy Information Administra-
tion numbers suggest OPEC
cuts, including Nigeria and
Libya, amount to about 75% of
what it promised.
Another wild card is non-
OPEC production. Russia and
10 other countries said they
would cut a total of 558,000
Company
VicSh US LC High Div Vol
VicSh US SC Hi Div Vol
VicSh US SC Vol Wtd
Amount Payable / WBI Tactical Hi Incm
Yld % New/Old Frq Record WBI Tactical Incm Shares
WBI Tactical LCY Shares
1.4 .31 /.28 Mar17 /Mar02
Q Foreign
1.4 .50 /.30 Q Mar23 /Mar03 DHX Media Var Voting
0.5 .05 /.04 Q Apr05 /Mar17 Itau Unibanco Holding ADR
3.1 .345 /.34 Q Mar15 /Feb23 Restaurant Brands Intl
Scorpio Tankers
Vermilion Energy
6.9 .1075 M Feb17 /Feb16
3.7 .35 Q Mar15 /Feb24 Special
0.2 .00464 M Feb17 /Feb16 Amerco
0.7 .02601 M Feb17 /Feb16 National Presto Inds
0.7 .0252 M Feb17 /Feb16
0.5 .018 M Feb17 /Feb16 KEY: A: annual; M: monthly; Q: quarterly; r: revised; SA: semiannual;
1.8 .06334 M Feb17 /Feb16 S2:1: stock split and ratio; SO: spin-off.
* *** THE WALL STREET JOURNAL.
CREDIT MARKETS
Pemex’s $4.5 Billion
Euro Bond Is Record
BY MIKE BIRD injection of capital by the
Mexican government last year,
Mexico’s national oil com- and Pemex is already highly
pany, Petróleos Mexicanos, leveraged.
issued €4.25 billion ($4.5 bil- The company presented its
lion) in bonds Tuesday, the five-year business plan in No-
largest euro-denominated vember, outlining its cost-cut-
emerging-market corporate- ting efforts and plans to re-
bond deal on record. duce oil production below 2
Emerging-market invest- million barrels a day for the
ments have recovered from an first time since 1980.
initial slump after U.S. Presi- But rising oil prices have
dent Donald Trump’s Novem- been a boon to energy compa-
ber election victory. Mexican nies around the world. The
assets, in particular, slid after yield on the last euro-denomi-
Mr. Trump’s win, with the nated debt sold by Pemex, a
peso falling as much as 16% three-year note issued in
against the dollar in the March last year, has tumbled.
months after the vote. The debt initially offered a
But the peso has rebounded 3.75% yield, which fell mark-
somewhat, rising 6% against edly as 2016 went on. The
the dollar in the past month. bond yielded 1.436% on Tues-
Other emerging-market invest- day.
ments have also recovered “When they issue in euros,
from some of their “Trump they’re going to get a lower
slump.” yield than they would in dollar
The deal is a landmark for paper,” said Sailesh Lad, emerg-
emerging-market issuers in ing-debt portfolio manager at
euro-debt markets. AXA Investment Managers.
“The maturing European According to data provider
market is now able to offer Dealogic, 121 euro bonds were
deep funding, it’s a bit of a taken to market by emerging-
coming of age,” said Jean- market issuers in 2016, more
Marc Mercier, global co-head than at any point since the
Over 60% of French sover- Likewise, daily trading vol- of debt capital markets at single currency began in 1999.
eign bonds are held ume in corporate bonds is 59% HSBC Holdings PLC, one of
abroad, but 28% of domesti- higher in February in compari- the banks acting as a bookrun-
AUCTION RESULTS
cally listed stock- and invest- son with the average over the ner for Pemex. Here are the results of Tuesday's Treasury auction.
ment-fund shares are held past three years, according The Pemex debt was issued All bids are awarded at a single price at the market-
overseas. according to the Eu- Trax, a subsidiary of trading across three tranches, matur-
clearing yield. Rates are determined by the difference
between that price and the face value.
ropean Central Bank. platform MarketAxess. But the ing in 2021, 2024 and 2028. FOUR-WEEK BILLS
Data on Japanese holdings rise is sharper still in sover- Yields on the bonds came in Applications $153,353,411,400
Accepted bids $45,000,351,400
of foreign bonds may reflect eign bonds, in which volumes lower than expected, at " noncompetitively $321,477,700
that some foreign investors are up 82%. 2.512%, 3.839% and 4.979%, re- " foreign noncompetitively $100,000,000
Auction price (rate) 99.959944
are saying au revoir. There has been a recent spectively, despite the com- (0.515%)
Japanese investors have pattern of locals being more pany’s financial struggles in Coupon equivalent 0.522%
Bids at clearing yield accepted 74.46%
been big buyers of French gov- relaxed about domestic politi- recent years. Cusip number 912796KN8
ernment debt in recent years. cal risks. In the immediate af- Tumbling oil prices and The bills, dated Feb. 16, 2017, mature on March 16,
But in the final quarter of termath of the U.K’s vote to pension obligations led to an 2017.
2016 they bought ¥19 billion leave the European Union.
($166.7 million), their lowest U.S.-domiciled funds investing
amount in a year and a half, in European stocks recorded
and they began selling in the outflows of 9%, compared with
final two months of the year. 1.7% for funds domiciled in the
Foreign investors also hold region.
less French corporate debt Analysts at HSBC Holdings
than government bonds, own- PLC believe that French corpo-
ing 26% of debt issued by non- rate markets will catch up to
financial companies. sovereign bonds closer to the
BRETT GUNDLOCK/BLOOMBERG NEWS
Investors have been selling second voting round in May,
in that market. The spread be- but local biases will remain.
tween yields on the Bloomberg “We think investors are
Barclays France Corporate likely to react very differently
bond index and the equivalent to wider French spreads in
German index reached 0.35 April, based on their country
percentage point last week, of location, country of parent
high by recent standards. But company and their own views
it has been much higher, a full of political outcomes,” the
percentage point in late 2012. bank said in a recent note. Yields on Pemex’s new euro bonds came in lower than expected.
COMMODITIES
and investment in the U.S.”
How Deep Is the Cut? Increased U.S. production Crude Prices Ride
OPEC members Libya and Nigeria were exempted from slashing has some market participants
production, and their growing output makes the cartel's overall questioning whether invento- A Data Tailwind
cut smaller. ries will decrease much this
year.
OPEC crude-oil production cuts, in millions of barrels a day The compliance mathemat- Oil prices rose on the
ics matters for investors who back of data indicating that
January 2017 estimates
have amassed a record number OPEC’s deal to cut production
0 Agreed cut IEA OPEC EIA of bullish bets on oil prices is holding.
since OPEC clinched the pro- U.S. crude prices for
duction deal. March delivery gained 27
-0.2 Wagers on rising U.S. oil cents, or 0.5%, to $53.20 a
Total
estimated prices by hedge funds and barrel on the New York Mer-
cut other big money managers are cantile Exchange. The April
-0.4
near their highest point in contract for Brent crude, the
more than 10 years of record- global benchmark, rose 38
-0.6
keeping by the Commodity Fu- cents, or 0.7%, to $55.97.
tures Trading Commission. The cuts from the Organi-
Amount cut That carries risks for zation of the Petroleum Ex-
-0.8 grows by prices, Mr. King said. “There’s porting Countries are provid-
excluding a lot of complacency out there. ing a tailwind, but most
Libya and If these bets start to unwind, observers believe it is going to
-1.0 Nigeria it will be a bloodbath.” take something extra to push
To be sure, OPEC’s swiftly prices out of the current range
executed production cut has and toward $60 a barrel.
-1.2 helped the group’s credibility. The OPEC data released
For years, it had been consid- Monday showed a month-over-
Sources: International Energy Agency; The Organization of the ered all but dead, incapable of month decline of 890,000 bar-
Petroleum Exporting Countries; U.S. Energy Information Administration putting aside its internal dis- rels a day in January.
THE WALL STREET JOURNAL. putes and geopolitics. Market participants are
Jim Krane, an energy stud- awaiting the next set of data
barrels a day this year, but the than the 300,000 barrels a day ies fellow at Rice University’s on U.S. inventories of crude
deal was light on details, mak- it agreed to cut. Goldman Baker Institute in Houston, and fuel, expected to be re-
ing it difficult to judge compli- Sachs Group Inc. estimates to- said the agreement showed leased Wednesday. Analysts
ance, traders said. tal compliance by OPEC and 11 that archenemies such as and traders surveyed by The
Russia, the world’s largest non-OPEC countries, which Saudi Arabia and Iran could Wall Street Journal expect
producer, cut 100,000 barrels agreed to jointly cut output in make a deal. Also, new satellite that crude stockpiles rose by
a day in January, the Interna- December, at about 85%. technologies mean oil ship- 2.9 million barrels last week.
tional Energy Agency said last “It is a numbers game,” ments are now very transpar- Some analysts have said
week, but that was down from said Doug King, chief invest- ent, he said, adding, “Cheating that the large inventory
post-Soviet records and less ment officer at RCMA Asset is very easy to detect.” builds in the U.S. have been
Management and manager of But there are also concerns seasonal and that the extra
Amount Payable / that firm’s $230 million Mer- that the current levels of com- barrels exported by many
Symbol Yld % New/Old Frq Record chant Commodity hedge fund. pliance with the cuts won’t last. OPEC members before the
CDL 1.8 .06037 M Feb17 /Feb16 “Despite good noises from Saudi Arabia says it has cut start date of the cuts are
CSB 1.3 .04582 M Feb17 /Feb16
CSA 0.5 .01845 M Feb17 /Feb16 OPEC, there are important ex- almost 800,000 barrels a day now starting to show.
WBIH 1.8 .03511 M Feb17 /Feb16 emptions and we don’t really by itself, far more than the The American Petroleum
WBII 0.4 .00732 M Feb17 /Feb16
WBIG 1.0 .01723 M Feb17 /Feb16 know what’s going on in Rus- 486,000 barrels a day it agreed Institute, an industry group,
sia.” to and carrying the load for said late Tuesday that its own
DHXM 1.3 .01445 Q Mar17 /Feb24 Another wrinkle for the countries that have fallen short data for the week showed a
ITUB 0.4 .00482 M Apr13 /Mar03 deal is U.S. shale producers, of their goals, such as Algeria, 9.9-million-barrel increase in
QSR 1.3 .18 Q Apr04 /Mar03
STNG 0.9 .01 Q Mar30 /Feb23 which are using the bump in Iraq and the United Arab Emir- crude supplies, a 717,000-barrel
VET 4.9 .16355 M Mar15 /Feb23 prices over the past two ates. rise in gasoline stocks and a
months to jump-start output. The kingdom often reduces 1.5-million-barrel increase in
UHAL 1.00 Mar09 /Feb23 OPEC on Monday doubled its output in the winter for main- distillate inventories.
NPK 0.9 4.50 Mar15 /Mar01
estimate of non-OPEC produc- tenance anyway, and it isn’t —Alison Sider
tion growth in 2017, blaming clear how long it will maintain and Kevin Baxter
“a pickup in drilling activities low production levels.
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
THE WALL STREET JOURNAL.
Email: heard@wsj.com
Log Out of Bank of the Internet
BofI Holding Inc., a rap-
idly growing bank with non-
traditional borrowers, ap-
pears to be winning its battle
with whistleblowers and
short sellers. But can the
bank stay ahead?
San Diego-based BofI, bet-
ter known as Bank of the In-
ternet, is a branchless bank
that takes high-interest de-
posits online and makes
niche loans, notably jumbo
mortgages to wealthy bor-
rowers including foreign na-
tionals and self-employed en-
trepreneurs.
It also has been contend-
ing for nearly a year and a
half with lawsuits alleging
lax controls and other
wrongdoing. Short sellers
have noticed and have bor-
rowed over one-third of the
company’s shares to bet
against it.
Those claims have been
denied by the company. Chief
Executive Gregory Garra-
brants has denounced what
he calls a “short-selling con-
spiracy.” Whoever is right,
the company’s high valuation
and risks to its business
model should be enough to
General Motors’ Adieu to Europe—and to Global Scale
General Motors cutting
its losses in Europe may be
the right move, but it also
could take GM out of the
ranks of global car makers at
a point when scale is critical.
PSA Group, the French
manufacturer that makes the
Peugeot and Citroën brands,
confirmed media reports
Tuesday that it was explor-
ing an acquisition of GM’s
European business, owner of
Opel and Vauxhall. Given
that the unit hasn’t turned a
profit since 2000 and is
plagued by overcapacity
even in a relatively buoyant
market, selling it makes nar-
row financial sense for GM.
Its shares bounced on the
news.
AHEAD OF THE TAPE | Steven Russolillo
Shares of PepsiCo
Losing Their Fizz
The cola
wars have
turned from
a stalemate
to a rout re-
cently.
Over the
past five years, PepsiCo
shares have beaten those of
Coca-Cola Co. by 50 percent-
age points. By diversifying
its business, the snack-and-
beverage giant’s sales and
volumes have risen along
with 15 consecutive quarters
of profit margin expansion.
Last year, PepsiCo even suc-
cessfully fended off activist
investor Nelson Peltz.
PepsiCo is set to report
fourth-quarter earnings on
Wednesday and the numbers
should be just fine. Analysts
surveyed by FactSet expect
earnings of $1.16 a share, up
9.4% from a year earlier.
PepsiCo has exceeded expec-
tations every quarter over at
least the past five years.
Revenue is forecast to have
increased 4.9% to $19.5 bil-
lion, accelerating for the
first time in nine quarters.
Are the stock’s best days
behind it, though? PepsiCo
shares hit a record over the
summer, right as investors’
thirst for yield was peaking,
but have struggled ever
since. The stock is down
since the November presi-
dential election, underper-
forming the S&P 500 by 11
percentage points as the
market has raced to records.
While PepsiCo’s profitabil-
ity has been boosted by cost
cuts and price increases, the
fact remains that it still gets
almost half of its revenue
from outside the U.S. That
includes countries with weak
currencies, such as Mexico,
Russia, the U.K. and Brazil.
PepsiCo’s international ex-
posure, particularly in to-
day’s political environment,
makes it more vulnerable to
earnings turbulence than do-
mestically focused peers.
HEARD ON THE STREET
Hitting the Refresh Button
BofI Holding has gradually recovered after shares were hit by a lawsuit
$40
Daily share price
35
30
25
20
15
10
2015
Source: WSJ Market Data Group
keep investors away.
BofI shares were knocked
by the lawsuits, the first of
which hit in October 2015,
but they recovered meaning-
fully, nearly doubling over
the past year.
The bank’s novel lending
strategy appears to have
worked remarkably well. In
the three months to Decem-
ber, BofI earned a net inter-
est margin of 4%, quite high
for a mainstream bank, and
much higher than four other
Scaling Up
Top 10 European car makers in
2016, market share by unit sales
VW Group
Renault 10.2
PSA 9.9
Ford 7.0
BMW 6.7
Opel 6.7
FCA 6.7
Daimler 6.2
Toyota 4.2
Nissan 3.7
Source: ACEA
However, it also runs
counter to the industrial
logic of automotive consoli-
dation allowing cheaper
manufacturing and sourcing
of parts. If GM faces no extra
costs in its core U.S. busi-
Mexico and Russia are two
of PepsiCo’s biggest revenue
drivers outside of the U.S. In
2015, they represented 10%
of the company’s sales, down
from 15% in 2011.
Even rival Dr Pepper
Snapple Group Inc., which is
more domestically oriented
than PepsiCo and Coke,
warned Tuesday that its
profit this year would be
pressured by the weak Mexi-
can peso.
The company has fallen
behind a prior target of tri-
pling revenue from nutri-
tious products to $30 billion
this decade. PepsiCo’s prod-
ucts have added more sug-
ars, despite threats from
many countries to tax or
curb sugar consumption. In
October the company re-
framed its health target, say-
ing it hopes sales growth of
its nutritious products “will
outpace” the rest of its port-
folio by 2025.
All of this comes as Pep-
siCo shares trade at a rather
bubbly 20 times projected
earnings over the next 12
months, near the 12-year high
it hit over the summer and
about one-fifth above its av-
erage over the past decade.
Switching cola brands might
not be the answer, either, as
Coke’s multiple is even richer.
Leave them both on the shelf.
Sweet and Sour
Share-price performance
75%
PepsiCo
50 Coca-Cola
25
0 recent job gains and rising
–25
2012 ’13 ’14 ’15
Source: FactSet
THE WALL STREET JOURNAL.
* * * *
FINANCIAL ANALYSIS & COMMENTARY
First lawsuit filed alleging
wrongdoing by BofI
’16 ’17
THE WALL STREET JOURNAL.
similarly-sized mortgage-fo-
cused lenders, including As-
toria Financial and Wash-
ington Federal, which have
an average net interest mar-
gin of 2.83%. BofI also re-
ported a 0.5% nonperform-
ing-loan ratio, low by normal
bank standards and well be-
low the average 0.94% for
the four mortgage lenders.
BofI shares have been bid
up to the point that any de-
terioration in these sterling
metrics could be costly. Its
ness, that is a damning in-
dictment of its supply-chain
management.
That said, PSA isn’t cer-
23.9% tain to prove a better parent
for Opel. True, it could be
easier for another European
business to find savings in
sourcing than GM and PSA
Chief Executive Carlos Tava-
res has done an extraordi-
nary job of bringing the
company back from the
brink of bankruptcy in 2013.
Its core automotive business
made a 6.8% operating mar-
gin in the first half of 2016,
compared with a 15-year av-
erage of 1%.
But replicating that suc-
cess in Germany, which
houses roughly two-thirds of
EQUITIES
Apple’s shares closed at a fresh high, while the Dow industrials, S&P 500 and Nasdaq Composite all closed at records on Tuesday.
U.S. Stocks Keep on Chugging to Records
BY AKANE OTANI
AND RIVA GOLD
Investors scooped up stocks
and dumped bonds on fresh
optimism about the U.S. econ-
omy.
The Dow Jones Industrial
Average closed at its sixth
high of the year, boosted by
Goldman Sachs Group, which
surpassed its previous record
set Oct. 31, 2007. The yield on
the 10-year Treasury note rose
to its highest level in more
than a week.
The moves came after Fed-
eral Reserve Chairwoman
Janet Yellen signaled Tuesday
that the central bank could
consider raising short-term
interest rates at its next pol-
icy meeting in March, citing
inflation.
Earlier in the day, govern-
ment data showed that the
’16 ’17 U.S. producer-price index rose
in January at the quickest rate
in more than four years, a sign
shares trade at 2.5 times
book value, compared with
1.8 times for the four proxies.
BofI has grown earnings
by an average 42% per year
over the past four fiscal
years. The lawsuits point to
some risks that can arise
when a bank grows aggres-
sively. In the two suits, for-
mer employees allege the
bank had lax controls on
loans to foreign nationals
and failed to adequately
check borrowers for criminal
backgrounds.
Mr. Garrabrants says the
bank has completed regula-
tory examinations since the
litigation started with no en-
forcement actions taken.
Nonetheless, it isn’t hard
to see how risks could esca-
late. BofI would be more ex-
posed than most lenders to a
decline in luxury housing
markets, or potential disrup-
tions from Trump adminis-
tration immigration policy.
Given these worries, BofI
isn’t worth its premium valu-
ation. Investors don’t need to
choose a dog in this fight to
know that they should stay
out of it. —Aaron Back
GM’s European staff, would
be tough, as Volkswagen’s
sobering example shows.
VW’s cost-cutting “pact for
the future” with unions has
broken down in recent weeks
amid accusations that man-
agers are cutting further
than agreed.
It is also unclear what GM
Europe’s brands would add
commercially to the PSA
portfolio.
PSA shares jumped 4% on
news of the potential deal, in
recognition that the Euro-
pean car industry needs con-
solidation. But the barriers
are as much political as geo-
graphic: Jobs in the car in-
dustry are arguably even
more sensitive in Germany
of higher inflation.
The Dow industrials rose
92.25 points, or 0.5%, to
20504.41, with Goldman Sachs
adding $3.19, or 1.3%, to
$249.46, topping its previous
record of $247.92. J.P. Morgan
Chase also hit a high, rising
1.41, or 1.6%, to 89.56. The
KBW Nasdaq Bank Index of
large U.S. commercial lenders
jumped 1.8%.
The S&P 500 rose 9.33
points, or 0.4%, to 2337.58,
and the Nasdaq Composite
added 18.62 points, or 0.3%, to
5782.57, record closes for both
indexes.
Apple set new intraday and
closing highs, climbing 1.73, or
1.3%, to 135.02, a day after it
closed at a record for the first
time since February 2015.
Government bonds and
their stock-market proxies
pulled back. The yield on the
10-year Treasury note rose to
2.470% from 2.434% Monday,
marking the fourth consecu-
tive session of rising yields
Wednesday, February 15, 2017 | B15
OVERHEARD
Small businesses are su-
per-excited about the econ-
omy under President Donald
Trump. That should worry in-
vestors.
On Tuesday, the National
Federation of Independent
Business said its index of
small-business optimism
reached its highest level in a
dozen years last month, tick-
ing up to 105.9.
There has been a massive
jump in the measure since
the election.
The burst of enthusiasm
might seem like good news
for the stock market. The re-
cord, however, suggests oth-
erwise.
Figures from FactSet go-
ing back to the mid-1970s
show that when the small-
business optimism index is
105 or higher, the S&P 500
has risen an average of just
4.7% over the next year.
When it is 85 or lower, the
index has gained 38%.
Maybe by the time the
good economic feelings trickle
down to Main Street, it is
time to bail out of Wall
Street.
than they are in the U.S. It
seems premature to get ex-
cited about cost savings.
Meanwhile, GM will need
to justify its retreat. Without
Opel, it would have made
fewer cars than the Renault-
Nissan-Mitsubishi alliance
last year. GM could keep
some European exposure by
taking a stake in PSA in ex-
change for Opel. But GM sold
a 7% stake in the company in
2013—just before PSA shares
rose by 85%.
As the burden of investing
in new technology mounts,
size matters. Perhaps Opel
doesn’t offer the kind of
scale any sensible car maker
would want.
—Stephen Wilmot
and the highest yield since
Feb. 3. Bond yields rise as
prices fall.
Shares of utilities compa-
nies in the S&P 500, which
tend to move in tandem with
bond prices, fell 0.7% and were
the biggest decliners in the
broad index.
6
The number of records reached
by the Dow industrials this year
Some investors and ana-
lysts have cautioned that a
more aggressive approach
from the Fed could derail the
stock rally that has taken in-
dexes to records multiple
times this year.
Still, others say continuing
growth in the U.S. economy
should support stocks. Inves-
WSJ.com/Heard
This Year,
Don’t Fight
The Fed
Fading the Federal Re-
serve’s interest-rate projec-
tions has long been a money-
maker for investors. The risk
is that has changed.
Speaking in the Senate on
Tuesday, Fed Chairwoman
Janet Yellen gave an upbeat
assessment of the economy.
She pointed out that job
gains have been solid, wage
growth has strengthened and
inflation has picked up. And
she repeated her warning
from January that waiting
too long to raise rates
“would be unwise.”
At the least, it sounds as if
the Fed is sticking with its
December projection for three
quarter-point rate increases
this year. If the next jobs re-
port is strong enough, the
first of those rate increases
could come next month.
If the Fed does follow
through, it would be the first
time in years that the central
bank got the economy right.
It would also be the first
time investors wouldn’t get
paid for betting against the
Fed.
But some investors still
think the Fed is going to fall
short. Interest-rate futures
are priced for only two rate
increases this year, with a
slight chance of a third.
It isn’t hard to come up
with scenarios in which the
Fed ends up going on hold
again—say, if the economy
hits a rough patch or if polit-
ical uncertainties roil mar-
kets. A more likely scenario
might be that fiscal stimulus,
or the anticipation of stimu-
lus, pushes up the economy
and leads the Fed to raise
rates more rapidly.
The one thing that seems
unlikely is that the economy
does great, but the Fed doesn’t
raise rates rapidly enough. But
that seems to be just what in-
vestors are betting on.
—Justin Lahart
RICHARD B. LEVINE/ZUMA PRESS
tors also have been expecting
tax cuts, fiscal stimulus and
looser regulations under Presi-
dent Donald Trump to stoke
growth.
Most investors don’t expect
higher rates at the Fed’s next
policy meeting. Federal-funds
futures, used by investors to
bet on central-bank policy,
showed an 18% chance of a
rate rise at the Fed’s meeting
in March, according to data
from CME Group, up from 13%
on Monday.
The WSJ Dollar Index,
which measures the dollar
against a basket of 16 curren-
cies, rose 0.1%, reversing
course from earlier in the ses-
sion. Higher rates tend to
make the dollar more attrac-
tive to yield-seeking investors.
Early Wednesday, Japan’s
Nikkei Stock Average was up
1.2%, while Hong Kong’s Hang
Seng Index and Australia’s
S&P ASX 200 were up 1%.
South Korea’s Kospi was up
0.4%.
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
B16 | Wednesday, February 15, 2017 THE WALL STREET JOURNAL.

MARKETS
A Remarkable Turnaround for Stocks
Market has reversed
from year ago’s trough What a Difference a Year Makes
to racking up record Investors are much more optimistic about the U.S. economy than they were in mid-February of last
highs 3 days in a row year, when U.S. stocks and oil prices cratered as fears mounted about the possibility of a recession. S&P 500 market
S&P 500 capitalization
BY BEN EISEN AND AKANE OTANI 2400 $20 trillion

Last February, U.S. stocks Feb. 11 June 23 Nov. 8 0.09%

were tumbling. Now, they are U.S. stocks, crude U.K. votes to leave Donald Trump
at all-time highs. oil hit a low the European Union elected president
2300
The Dow Jones Industrial 16
Average, the S&P 500, the Nas-
daq Composite and the Russell
2000 index of small-capitaliza-
tion companies closed at re- 2200
cords on the same day for the
third straight session Tuesday. 12
That is quite a turnaround
from mid-February of last
2100
year, when a barrage of sell-
ing sent the S&P 500 to its
lowest close since April 2014. 8
Fears about falling oil prices
and an economic slowdown in 2000
China helped drive the S&P
500 down more than 10% from March 17 Sept. 21 Dec. 14
the end of 2015 to its Febru- U.S. oil prices settle Federal Reserve Fed announces 0.02%
above $40 a barrel signals rate increase interest-rate 4
ary trough.
1900
Since then, markets have for first time in 2016 before year-end increase
reversed with the kind of force
that few predicted at the time.
The S&P 500 has posted
several records and passed 1800 0
$20 trillion in market value 2016 ’17 Feb. 11, 2016 Feb. 14, 2017
for the first time ever Monday,
according to the S&P Dow Change since Feb. 11, 2016
Jones Indices. The S&P 500
has climbed 28% from a low
on Feb. 11, 2016, helped by
solid U.S. economic data, im-
provement in corporate earn-
ings and a rebound in oil
77% 103% 31% 0.83 pct
pts 62%
prices, which have doubled
from a nearly 13-year low. Goldman Sachs Group U.S. crude-oil prices Dow Jones Industrial 10-year Treasury yield CBOE Volatility Index
U.S. indexes have weathered
surprise events such as the stock price Average
U.K.’s vote to leave the Euro- $249.46 $55 a barrel 20000 20504.41 2.47% 30 Feb. 11
$260 2.6%
pean Union in June and Presi- 28.14
dent Donald Trump’s victory in 240 50 2.4
19000
November—the latter of which 25
2.2
220 45
has given stocks their latest 18000 2.0
jolt higher. The S&P 500 has 200 40 20
Feb. 11 1.8
gained 9.3% since the Nov. 8 17000
180 $140.69 35 $53.20 10.74
election. 1.6 15
The magnitude of the snap- 160 30 16000
Feb. 11 Feb. 11 1.4 Feb. 11
back is one reason why some
investors are worried that the 140 25 $26.21 15000 15660.18 1.2 1.64% 10
rally has gone too far too fast. 2016 ’17 2016 ’17 2016 ’17 2016 ’17 2016 ’17
But so far, this February is a Sources: WSJ Market Data Group (Goldman Sachs, S&P 500); SIX Financial (DJIA, VIX,
far cry from the last one. front-month crude); Ryan ALM (Treasury); S&P Dow Jones Indices (market cap) THE WALL STREET JOURNAL.