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The 71st annual Financial Follies (“The Follies”) was held last Friday at the Marriott Marquis in Times Square and hosted by the New York Financial Writers’ Association.
The Follies is an event where reporters and public relations professionals alike engage in respectable behavior and generally call it a night after their second drink.
I’d been privy to yarns of Follies past and was eager to partake in the gala dinner while representing my firm. Having participated in the Follies this past Friday, I would like to offer a few distinguishing factors that demonstrate why the Follies is the networking event of the PR/business media world:
The amount and diversity of outlets
Based on the crowd size — conservatively speaking about 1.7 million people (certain outlets, such as the New York Financial Writers Association had the official number at 900, but I’m going with my gut on this one) — the Follies is the ultimate networking event. At our table (and I will list them because in an oversight they weren’t listed on the official Follies program), we had editors from Buzzfeed, The New York Post, and CFO Magazine, as well as reporters from Hedge Fund Manager (HFM) Week and The Wall Street Journal. In addition, representatives from Business Insider, MarketWatch, TheStreet.com, and The Bond Buyer dropped by our table to partake in revelry and liberate various beverages.
Inside jokes and financial puns
What better venue to discuss the latest in financial journalist scuttlebutt? During the Follies, an all-star cast of journalists take the stage and perform skits based on current events. The performance rivaled that of “Spiderman: Turn Off the Dark,” and it was clear those on stage had invested their time and had a diversified range of skills.
Some inelegant members of the audience were clearly “Fed up and/or just Yellen” because they lacked a cultured character. Either way, the show eventually tapered off and dinner arrived as our able waiters eased quantitative amounts of steak…I’ll stop.
Meeting reporters face-to-face
In previous posts, I’ve detailed my experiences meeting with journalists and forging professional relationships. This event was perfect because it gave me and the other PR pros in attendance the opportunity to meet journalists and reporters in a festive setting, and none of the reporters could use the excuse that they were on deadline in order to avoid us.
If you work in public relations and didn’t attend – convince your boss for next year
The Follies don’t come cheap, but the access to reporters is unparalleled, and the event itself is sure to generate many a conversation the following Monday at work. Plus, there are several sponsored after-parties with further opportunities for media networking in a professional setting.
The Follies is a unique and boisterous networking experience that can’t be missed if you’re a media professional. The atmosphere, show, and singular access to influential and eclectic media personalities in attendance make this a must-attend event.
Bill C. Smith (@BillCSmith87) is a senior account executive at Dukas Public Relations in New York.
by Chris Roush
- The Donald W. Reynolds National Center for Business Journalism has selected 30 fellows – 16 journalists and 14 professors – for four days of intensive study in business journalism.
The fellows will attend separate seminars Jan. 2-5, 2014, at Arizona State University’s Walter Cronkite School of Journalism and Mass Communication in Phoenix.
Journalists in the Strictly Financials Seminar learn how to dissect financial statements and SEC documents. Prospective business journalism professors receive training in how to teach a university-level course in business journalism.
The seminars, taught by highly regarded business journalists and business journalism professors, are part of Reynolds Business Journalism Week at the Cronkite School.
Click here to see who was picked.
by Liz Hester
This is going to be a big week for financial reform. A division of the Treasury Department is looking to regulate the asset management industry. The Obama administration is also in the midst of negotiating the details of the Volcker rule, which bans firms from trading for their own accounts.
Here’s the Wall Street Journal story on the new asset management regulations:
The asset-management industry is pushing back against a powerful, yet little-known Treasury Department office that is laying the groundwork for tougher federal regulation of mutual funds and other asset managers.
Large firms such as BlackRock Inc., Pacific Investment Management Co. and Fidelity Investments are blasting a report by the Office of Financial Research that found asset managers could pose risks to the broader financial system. The finding is significant because it is among the criteria a group of senior U.S. regulators will use to determine whether large asset managers are “systemically important” and should be drawn in for stricter oversight.
The Financial Stability Oversight Council, which is chaired by Treasury Secretary Jacob Lew and includes top officials from the Federal Reserve, Securities and Exchange Commission and other agencies, is in the early stages of considering the risks associated with the asset-management industry, with a focus on BlackRock and Fidelity, according to people familiar with the council’s discussions. The council can designate firms as systemically important under the 2010 Dodd-Frank law, which created the FSOC and Office of Financial Research to help prevent a repeat of the financial crisis.
The council this year has designated American International Group Inc., Prudential Financial Inc. and General Electric Co.’s GE Capital unit with the systemic label, and MetLife Inc. is under review. The Fed hasn’t outlined rules for these firms yet but has said it would be flexible in applying rules to different industries. Insurers and asset managers fear they will face requirements to rein in risk taking similar to those applied to banks.
By singling out some of the largest asset managers for greater oversight, the government is extending its reform mandate and could make it more challenging for them to generate returns. Other Wall Street firms are concerned about their ability to make money as well. The New York Times had this story on the Volcker Rule:
The Obama administration, currently stumbling through the health care overhaul, has reached a critical stage in its other signature effort: reining in Wall Street.
The push to reshape financial oversight hinges on negotiations in the coming weeks over the so-called Volcker Rule, a regulation that strikes at the heart of Wall Street risk-taking. The rule, which bans banks from trading for their own gain, has become synonymous with the Dodd-Frank overhaul law that Congress adopted after the financial crisis.
Treasury Secretary Jacob J. Lew has strongly urged federal agencies to finish writing the Volcker Rule by the end of the year — more than a year after they had been expected to do so — and President Obama recently stressed the importance of the deadline.
While regulators are optimistic they will complete the rule soon, even after facing a lobbying onslaught from Wall Street, they have little time to overcome the internal wrangling that has stymied them for years.
The tension among regulators — five agencies are writing the rule — has centered on just how stringent to make it.
The National Journal outlined some of the issues the five agencies are struggling to resolve as they make the new rules:
The biggest problem hasn’t been the difficulty of defining which trades are permissible under the Dodd-Frank statute. (Hedging and market-making—in which a firm says it will buy and sell stocks at a given price—are OK; making risky bets for profit, known as “proprietary trading,” is not. The line between them, Wall Street and regulators argue, is fuzzy.) The problem hasn’t even been the stupefying amount of work Dodd-Frank handed to regulators, who must devise 398 rules, according to law firm Davis Polk & Wardwell, without giving all the relevant agencies enough of a funding boost for the job. Three years in, and they’re still only 40 percent there.
No, say Wall Street and former Washington officials: The biggest problem may be the cultural gaps between the five agencies charged with writing the Volcker Rule. It’s not the first time regulators have had to work together, but such collaboration—particularly between banking cops and market cops—was less frequent before Dodd-Frank. It is expected to become more common, and the Volcker Rule experience suggests that it won’t be easy.
The Dodd-Frank statute convenes the Federal Reserve Board, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency, the Securities and Exchange Commission, and the Commodity Futures Trading Commission. Together, they are meant to write the rule, named for Paul Volcker, the former Fed chairman and a reform advocate. That means they’ve got to get everyone on board, and any agency can hold up the process over any point. This has produced frustrating delays, Volcker said at a conference in March. “How many times people told me six months ago, ‘It’ll be two weeks, Paul! We’re going to get the regulation out. It looks like it’s right there.’ Doesn’t happen,” he said. “Two months later, ‘Well, before the end of December.’ ‘Well, before the end of January.’ You cannot operate an effective regulatory system this way.”
The greatest cultural divide is between the three banking regulators (the Fed, the FDIC, and the OCC) on one side and the two market regulators (the SEC and the CFTC) on the other. The banking types have historically worked confidentially to examine institutions’ practices and correct them when they’re out of line; these officials cooperate and even embed staff at the banks themselves, so it stands to reason they prefer flexibility on this rule and other parts of financial-regulatory reform, say former officials and financial-regulation experts who asked to speak anonymously in order to generalize. The market regulators, on the other hand, are focused on investor protection and disclosure; they like to draw bright, easily enforceable lines, the officials say.
The difference between the market and banking regulators just may make this task a difficult one to finish. Either way, a year after the deadline, it’s time for them to take some of the uncertainty out of the markets and make a decision on final rules for firms to implement.
by Chris Roush
Felix Salmon of Reuters writes about how the New York Times neglects its business news coverage when it tweets stories.
Salmon writes, “Give business stories a bit of promotion on the home page and on Twitter, in other words, and they’ll get you just as many pageviews as anything else, on average. But it turns out that the business section is systematically shortchanged by the people making those promotional decisions. Maybe (I’m not sure) because it has a higher concentration of wire stories.
“Again, this looks like strategic short-sightedness. Business-news pages are some of the most valuable on the website, in terms of the amount that the NYT ad-sales team can charge for them. (They’re so valuable, in fact, that the entire Dealbook section remains outside the NYT paywall, in an attempt to garner it as many pageviews as possible.) By promoting more business stories, even if they are (horrors!) wire stories, the NYT could make more money, and everybody wants that — including the readers, who have shown that they have more interest in such things than the NYT’s editors think that they do.
“What would be lost by such an approach? Very little: a few dining and metro stories might get viewed less often, if their promotional muscle started getting transferred to the business section. And maybe a few NYT egos might get a little bruised, if they discovered that their snowflakes weren’t quite as precious, to the outside world, as they liked to think, at least in comparison to the wire. But the website should be run for readers, not for journalists. And improbable as it might sound, it looks very much as though those readers would be best served if the NYT made it significantly easier to find wire stories, business stories, and — especially — business wire stories.”
Read more here.
by Chris Roush
A Columbus Dispatch business reporter and avid bicyclist was struck and injured by a car Sunday while riding.
Jim Woods and Kathy Lynn Gray of the Dispatch write, “Steve Wartenberg, 55, was in critical condition in intensive care last night at OhioHealth Riverside Methodist Hospital with multiple broken bones.
“Wartenberg was hit about 11:44 a.m. on McCoy Road near Kenny Road. He hit the windshield of the car before landing on the pavement. His helmet and bicycle were in pieces, said his wife, Susan Cunningham.
“‘I’m sure his helmet saved his life,’ she said.
“Upper Arlington Police Sgt. Glenn Willer said Wartenberg was eastbound on McCoy Road when he was struck from behind just west of Kenny Road by a vehicle driven by Andrew Scott Inglis, who also was eastbound on McCoy.
“Willer said Inglis, 30, fled the scene and was captured a few minutes later. He has been cited for drunken driving, failing to keep an assured clear distance and fleeing the scene, Willer said.”
Read more here.
by Liz Hester
The Commodity Futures Trading Commission has been in the news lately, especially as it restarts after the government shutdown.
The Wall Street Journal had an interesting story about the CFTC being undersized and lacking funding to bring charges in certain cases:
The Commodity Futures Trading Commission is so cash-starved that the agency is being forced to delay cases, shelve certain probes and decided not to file charges against two former traders over J.P. Morgan Chase & Co.’s “London whale” trading mess, a top official said.
In an interview, David Meister, who stepped down this week as the CFTC’s enforcement chief, said the agency is “absolutely undersized” for the sprawling futures and options markets it must police.
“We will do everything we can…but we have limited staff and limited resources,” Mr. Meister said. “Ultimately, it comes down to the math.”
The 50-year-old former prosecutor’s warning came Wednesday, his last day at the CFTC after a near-three-year enforcement stint. Since he joined the CFTC in January 2011, the once-obscure agency has reinvented itself to become an apparent force to be reckoned with.
During Mr. Meister’s watch, the CFTC nearly doubled its enforcement actions and tripled its sanctions, compared with the previous three-year period. This year alone, it has filed a number of high-profile cases, including civil actions against Jon S. Corzine, former chief executive of MF Global Holdings Ltd., and CME Group Inc., the world’s largest futures-exchange operator. Both deny wrongdoing and are fighting the cases.
The call for more funding came after the New York Times had a story Oct. 30 about the agency’s move to tighten rules and enforce new ones:
In October 2011, as the futures broker MF Global teetered on the brink of collapse, it dipped into client accounts in an effort to avert bankruptcy.
But the action failed to save the broker, and its implosion left thousands of clients short a total of $1.6 billion.
Two years after MF Global’s bankruptcy, regulators have sought to restore confidence in the industry, tightening rules that force brokerage firms to better safeguard client money.
The Commodity Futures Trading Commission voted 3 to 1 on Wednesday to finish rules proposed a year ago to protect customers, including measures to close loopholes, reinforce internal risk controls and force brokers to provide more information to clients.
“This new information is critical in today’s world of high-frequency trading,” said Gary S. Gensler, chairman of the commission. “Thus, with these reforms, the commission will get additional tools to oversee the markets’ largest day traders and high-frequency traders.”
The new rules are part of a wider shift in policy to better regulate the futures industry after years of lighter-touch policy.
Brokers will be subject to tougher auditing standards and will be required to provide daily reports that include details of each separate client account. Those reports will be filed electronically. Mr. Gensler said that step was “the right place to be in the 21st century.”
The commission also voted to close a loophole that allowed brokerage firms to use money from client accounts that traded overseas under an exemption called the “alternative calculation.”
The most debated of the new rules will change how brokers keep collateral and make margin calls to ensure limits on defaults. Brokers, who are required to provide a financial buffer in client accounts, will also be forced to make clients pay several days earlier than they do now.
The regulations come after the agency had to furlough workers during the government shutdown, disrupting negotiations with firms as well as the ability to take enforcement action. Bloomberg had this story Oct. 24:
The Commodity Futures Trading Commission, the main U.S. derivatives regulator that pried $1.7 billion in fines and other penalties from the firms it regulates during the past year, is furloughing workers because it doesn’t have enough money to pay them.
“This is the budget reality we face,” CFTC Chairman Gary Gensler told employees today in an e-mail, which announced they would be asked not to work on as many as 14 days in the fiscal year that began this month. “I understand this is extremely tough news for your families and you. I want to thank each and every one of you for your dedication to this agency and your hard work, which is of great benefit to the American public.”
The CFTC’s investigation of manipulation of the London InterBank Offered Rate, which sets rates on products such as mortgages and interest-rate derivatives, led to fines this year including $700 million from UBS AG. The furloughs coincide with the Washington-based regulator’s mandate, stemming from the 2010 Dodd-Frank Act, to start overseeing the $633 trillion over-the-counter derivatives market.
“The timing is unfortunate given the need to implement Dodd-Frank,” said Robert Webb, a finance professor at the University of Virginia. The 16-day partial U.S. government shutdown this month also disrupted the agency, and further time off will only make the CFTC’s job harder, he said.
It’s going to be hard for the agency to enforce new rules if it doesn’t have money. This is another unforeseen aftermath of new financial regulations, granting new oversight but not giving agencies the ability to follow through.
by Chris Roush
Scott Perry, the business editor of the Herald-Review in Decatur, Ill., dressed up for Halloween in the newsroom Thursday.
The photo is by Allison Petty, a reporter at the paper.
In an email to Talking Biz News, Perry wrote:
Up until a couple years ago, this was an every year thing. Unlike this year’s costume, most of them were made by me — mostly with boxes and tape. Got to be such a big deal that even people who had moved on were sending emails each year wondering what I came as. I’m really proud of my newspaper box, Sponge Bob, and witch hitting a pole (just like those decorations, but real), to name a few.
After missing a Halloween, I started focusing my efforts on creating costumes for the annual Chamber Business Expo. Those costumes always have some connection to the newspaper and Business Journal, of which I am the editor. It started with me wearing a sandwich board one year. After getting so many positive responses, I stepped it up and went as a cheerleader (“Be a cheerleader for your business.” The skirt was made out of newspapers), Pac Man ( Don’t get gobbled up by the competition), the newspaper box made an appearance, a padlock (The perfect combination), and a bed (We got you covered. The blanket was made out of newspapers.)
I’m attaching a picture of my newspaper box costume. There’s a couple funny stories that go with this one. I decided to walk around downtown in the costume with a co-worker. While I was stopped on a corner, a woman came up and REALLY tried to put money in the slot to get a paper. I guess the legs hanging out the bottom of the machine didn’t set off any alarms. My co-worker had to point out it was a costume, not a real machine. Then at work, I sat inside the costume next to the desk of the person working the desk that night waiting for her to arrive. When she got in, she said something like “Is this Scott’s costume this year?” and opened the door, at which time I popped out. You can guess her reaction.
This year was just a last-minute decision as I was getting dressed for work. I had the M&M costume and thought it would be fun to surprise people again. It was.
by Chris Roush
With a $3 million gift from the Harold W. McGraw Jr. Family Foundation, the City University of New York’s graduate school of journalism will get a center for business journalism, reports Melanie Grayce West of The Wall Street Journal.
West writes, “The Harold W. McGraw Jr. Center for Business Journalism at CUNY will create a fellowship program, scholarships, internships, seminars and an annual symposium for business journalists.
“Stephen Shepard, the founding dean of CUNY’s graduate journalism school, will oversee the development of the center’s programming. Mr. Shepard was the former editor in chief of BusinessWeek, when it was a publication owned by McGraw-Hill, and he is a friend of the family, according to Mr. McGraw. The McGraws wanted to make the gift before Mr. Shepard steps down as dean of the school later this year.
“”The late Mr. McGraw was a strong believer in the ‘whole art of journalism,’ said Mr. McGraw. ‘To be able to make a difference in some other people’s lives in his name is pure joy for me and my brother and sister.’”
Read more here.
Some of the top stories in business journalism today:
New York Times top headlines:
Many Wall St. banks woo children of Chinese leaders, by David Barboza
Currency volatility is unnerving investors, by Nathaniel Popper
Reuters top headlines:
Greece’s ‘third’ bailout talk shadows ECB visit to Athens, by Harry Papachristou
America Movil secures financing to buy KPN, by Robert-Jan Bartunek
CNNMoney top headlines:
Where U.S. aid to Egypt goes, by Steve Hargreaves
Fortune top headlines:
A U.S. manufacturing comeback won’t rebuild the middle class, by Nin-Hai Tseng
Bloomberg top headlines:
Sales of U.S. existing homes rise to highest since 2009, by Victoria Stilwell
BMW owners waiting for repairs on supply chain breakdown, by Angela Maier and Richard Weiss
This date in business journalism history:
by Chris Roush
Talking Biz News will host its first event on Nov. 1 in New York that will have two panels discussing the future of business journalism.
The event, which will begin at noon, will be held at the CUNY Graduate School of Journalism in Times Square.
The first panel will discuss the relationship between business journalists and companies and feature panelists such as Sally Beatty, a former Wall Street Journal reporter who works at Pfizer, and BuzzFeed business editor Peter Lauria.
The second panel will examine business models for business journalism media and include Rob Fisher, group publisher and senior vice president at American City Business Journals, operating out of New York.
Both panels will be moderated by Talking Biz News founder Chris Roush.