Tuesday, October 24, 2017

A Problem of Perception

"Treasury Department sides with Wall Street on arbitration rule" by Renae Merle Washington Post  October 24, 2017

In a highly unusual move, the Trump administration on Monday attacked a rule proposed by one of its own agencies.

The intergovernmental fight pits regulators appointed by President Trump — Treasury Secretary Steven Mnuchin and acting comptroller of the currency Keith Noreika — against one of the few Obama administration appointees remaining — Richard Cordray, the head of the Consumer Financial Protection Bureau.

It is not unusual for such regulators to disagree, but rarely do those squabbles spill out into public view. The Trump administration has made unwinding many of the regulations put in place following the Great Recession a top priority.

The regulation at the center of the fight addresses the fine print in many of the agreements that consumers sign when they apply for credit cards or bank accounts. These agreements typically require them to settle any disputes they have with the company through arbitration, in which a third party rules on the matter, rather than going to court or joining a class-action lawsuit.

The new rule is widely loathed on Wall Street, which has estimated it would cost them billions of dollars, and among Republicans in Congress, who call it a gift to plaintiffs’ attorneys.

The rule ‘‘fails to account for significant costs of class action litigation and benefits of arbitration in a meaningful way,’’ the Treasury Department said in an 18-page report. And it ‘‘would upend a century of federal policy favoring freedom of contract to provide for low-cost dispute resolution.’’

The CFPB dismissed the Treasury Department’s report, saying it rehashes old industry arguments.

Also slowing Wall Street efforts has been backlash against two big financial firms, Wells Fargo and Equifax. Wells Fargo has been under pressure since admitting last year that employees had opened millions of sham accounts customers didn’t ask for, and Equifax is struggling to recover from a massive hack that affected more than 145 million people. Consumers groups have used both cases as a rallying cry against arbitration clauses, which Wells Fargo and Equifax both use, but the Treasury Department’s report could provide a boost to efforts to derail the rule.

‘‘It provides some needed political cover for the few Senate Republicans who have been reluctant to vote in favor of the banks,’’ Jaret Seiberg, an analyst with Cowen and Co.’s Washington Research Group, said in a recent report. ‘‘This is a way to argue they were voting for consumers over lawyers. And with all the love in the world to our lawyer friends, lawyers have an even worse perception problem than bankers.’’

That's enough with the stereotypes, please.



"In back-to-back victories for Johnson & Johnson, the courts have reversed two judgments against the consumer products giant totaling nearly $500 million. The money had been awarded to women who said that they developed ovarian cancer after using the company’s talcum powder for decades. On Friday, a Los Angeles County Superior Court judge tossed out a $417 million judgment awarded to Eva Echeverria in August. She was found to have ovarian cancer in 2007, after using Johnson’s Baby Powder for more than 40 years. In her ruling, Judge Maren E. Nelson granted the company’s motion for a new trial. The judge cited the “insufficiency of the evidence” and said that the damages awarded were excessive. Echeverria has died, the Associated Press reported, but her lawyer, Mark P. Robinson Jr., said in a statement that he planned to file an appeal “immediately.” Echeverria is among thousands of women who have filed lawsuits against Johnson & Johnson after some studies found an increased risk of ovarian cancer among women who have used talc in the genital area. Last Tuesday, an appeals court in Missouri vacated a $72 million jury award in a case involving Jacqueline Fox, 62, of Birmingham, Ala., who died of ovarian cancer in 2015 and who had been using Johnson’s baby powder for more than 20 years. The court ruled that Missouri was not the proper jurisdiction for the lawsuit. In a statement, Carol Goodrich, a spokeswoman for Johnson & Johnson, said: “Ovarian cancer is a devastating disease — but it is not caused by the cosmetic-grade talc we have used in Johnson’s Baby Powder for decades.”

Did the CFPB look into that?

Also seeMass. faces an Alzheimer’s epidemic, forecast warns

You know, I just can't help wondering if it is the poisonous products you see every day on store shelves.


Now to the front page and the three-for down the right-hand side:

"This isn’t the first time Warren spoke about that office incident" by Julia Jacobs and Victoria McGrane Globe Correspondent | Globe Staff  October 24, 2017

WASHINGTON — When Senator Elizabeth Warren on Sunday told a national television audience a personal story of sexual harassment from her days as a young law professor, she described a harrowing incident that left her shaken, but the tone of her telling, recounted on NBC’S “Meet the Press,” appears to be inconsistent with the reportedly more lighthearted manner in which she described the same incident two decades after it occurred, during the memorial service for the senior University of Houston faculty member she accused of pursuing her around his office.

Oh, no.

During the service after his death in 1997, Warren spoke fondly of law professor Eugene Smith and told the gathered mourners she was laughing as Smith chased her around his desk, according to a colleague’s memoir. The writer of the memoir, however, now says he might have treated the incident too lightly.

Warren, in a short interview with the Globe Monday, did not directly answer when asked if she spoke fondly of Smith at his memorial or if she told mourners she was laughing as Smith tried to grab her in his office.

“I made it clear that I was just fine,” was all she said.

The contrasting accounts would appear to highlight the evolution of Warren’s approach to dealing with the episode. That evolution took place amid changing attitudes about harassment and increasing empowerment of women to speak up.

In a taped segment for the Sunday morning news show, Warren described how a senior faculty member — whom she did not name — chased her around his office, “trying to get his hands on me.”

Warren told “Meet the Press’’ that the incident left her shaking and shocked and that she told only her best friend what had happened. “Never said a word to anyone else,” she said.

She did not mention that Smith had suffered from polio, which affected his mobility, nor did she mention she spoke at his service.

Warren was interviewed about her experience with sexual harassment along with three other female senators as part of NBC’s coverage of the #MeToo campaign. The hashtag has come to symbolize the scope of workplace-related sexual harassment after reports detailed numerous allegations against entertainment mogul Harvey Weinstein.

Did you see who started it?

Warren told the Globe Monday she was conflicted about speaking at Smith’s service. He had asked her to do so while he was dying, she said.

At the service, Warren “described Gene’s chasing her around the desk in uncontrolled lust while she laughed, equally uncontrolled, as she avoided his crab-like grasp,” John Mixon, a former colleague of Warren’s at the University of Houston Law Center, wrote in a 577-page book, called “Autobiography of a Law School,” a memoir that chronicles the law school’s history.

Warren told the Globe she made the trip to the memorial service “because I was fine, and I didn’t want anyone to think I wasn’t,” she said.

She added that she hadn’t seen Mixon’s description of her relationship with Smith before the Globe inquired about it, but she pointed to a phrase — “she would have none of it” — that Mixon used to describe her attitude toward Smith’s advances.

“That was a good description of how I felt at the time he chased me around the table,” Warren said.

When she told NBC she’d never said a word about the incident, Warren said, she meant she had never reported it to the University of Houston administration, other senior faculty members, or other officials who might have taken action against Smith. 

Only five years in the Senate and she is a master disassembler already.

“I wore a lot of brown. I tried to handle it on my own, just to stay out of his way and to be as far away as I could,” she said in the Globe interview.

What does the color of clothing have to do with it?

“But yeah, years later I feel bad that I didn’t speak up. But that’s why it’s so important for women to stand up together and speak out together. . . . I did the best I could at the time,” she continued.

In an interview with the Globe, Mixon, who is 84 years old and retired, said Warren, at the service, told of her experience trying to escape from Smith’s advances as a fond, matter-of-fact story. He said it was the first time he had heard about the incident, but in retrospect he worries he may have treated it too lightly in his book and said he is now unsure if Warren said she was laughing while Smith chased her, as he wrote.

“I think I may have been wrong in saying she was laughing,” he said, noting he was writing about the memorial service 15 years after it took place. “Probably more lightly than it should’ve been treated, certainly, in today’s retrospective world.”

Either you or her are revisionist liar, and that's not good either way.

People dying in wars based on lies but this is top story in the Globe.


She should be glad she wasn't an adjunct, and what about sexting?

Warren wants investigation of Navient trades 

Different kind of hara$$ment. Possible insider trading of shares of student loan company. 

"Fidelity’s Abby Johnson has a chance to set a higher standard" by Shirley Leung Globe Columnist  October 24, 2017

Can Abby Johnson retire the old boys’ club?

Johnson, the CEO and chairwoman of Fidelity Investments, finds herself in the middle of her first public crisis, and how she handles it may very well shape her legacy at the company and in the money management industry.

The staid Boston mutual fund giant has been buffeted in recent weeks by allegations, first reported in The Wall Street Journal, of sexual harassment and bullying inside the company’s famous stock-picking unit. At least two senior male portfolio managers, including star fund manager Gavin Baker, have been forced out.

He was stabbed in the back.

The complaints are all too familiar in this post-Harvey Weinstein world: a male-dominated culture gone awry, where fraternizing is rewarded and lines can be easily crossed, and where people look the other way because there’s money to be made.

A culture dominated only by certain males. 

Oddly enough, they belong to Abby's cla$$.

This is a unit where the legendary Peter Lynch picked stocks, and where Johnson herself was an equity analyst nearly three decades ago as she worked her way up the family business — one started by her grandfather and built into a powerhouse by her father, Edward “Ned” Johnson III.


Abby Johnson took full control of the closely held company in December, when her father stepped down, and she hasn’t hesitated to show who’s the boss in responding to the sexual harassment allegations.

She personally decided to fire Baker, who was one of the company’s highest profile fund managers, overseeing nearly $17 billion in assets. He was known for an aggressive style, making bets on emerging tech companies such as Uber and Tesla. He was shown the door last month after a 26-year-old female equity research analyst filed a complaint against Baker with the human resources department alleging sexual harassment.

Baker, through a spokesman, denies those accusations.

On Monday, thousands of Fidelity employees were greeted with a minute-long video message from Johnson, who declared “we have no tolerance at our company for any type of harassment. We simply will not, and do not, tolerate this type of behavior, from anyone.”

In the video, provided to the Globe, Johnson said the company will investigate allegations and take appropriate action.

“This is an extremely important issue for me and the leadership team and one that should be very important to each and every associate,” she said. “I expect when issues occur, associates will raise them, so we can fix them and make sure they don’t happen again. Together, we own our culture and the experience of our associates, and we should be very proud of both!”

Johnson has brought in a workplace consultant to examine whether the equity division is hostile to female employees. While Fidelity has women in senior roles across the company, equity fund management tends to be dominated by men. Women made up 9.5 percent of Fidelity’s equity fund managers in 2016, according to research and data firm Morningstar, a figure that is on the lower end compared with competitors T. Rowe Price (11.1 percent) and Franklin Templeton (13.8 percent).

But I hope Johnson does more — much more than just put this one unit under a microscope.

Here’s why: We are in an unprecedented moment for women everywhere, where silence is no longer golden. Women feel strength in numbers to come forward and talk about gender discrimination in the workplace, from New York to Silicon Valley to Hollywood. As one of the most powerful women in business, she can lead the charge in cleaning up one of the oldest boys clubs of all — the world of managing money.

This is not about being politically correct. This is about how Fidelity can make more money by doing the right thing. In an interview on Bloomberg TV in September, Johnson acknowledged the need to hire more women at Fidelity because their customers are asking for them.

“We have a real need in our business right now to recruit more women, because when women customers come into our branches, very often the first thing they say is . . . I’d like to work with a woman,” said Johnson, explaining that female customers feel more comfortable with female advisers.

Yes, it's better if a woman lies to you

Now give us your money!

Let’s put this against the backdrop of the great wealth transfer in which women are expected to control half of this country’s private wealth by 2020.


Then let’s put another fine point on this: “Fidelity is a giant in the mutual fund industry, so if Abby Johnson is able to foster an environment where women and men are on a par from a leadership perspective, that would create an important example for peer firms,” said Laura Lutton, fund research director at Morningstar.

I keep thinking back to Fidelity’s last big mess. About a decade ago the company paid $8 million in fines to settle federal charges that its traders improperly received gifts, including junkets on private jets, gambling outings, hiring of women believed to be prostitutes, and engaging in “dwarf tossing” as entertainment.


Fidelity blamed a few bad apples, fired them, and tightened its gift policies.

This time around, Abby Johnson should signal to the boys that she’s just getting started. She should examine workplace culture throughout the company, and whether Fidelity does enough to make sure women feel they are in a place where they can thrive.

If she has to fire bushels of bad apples, it will only be a better company in the end....

How many more bad apples can there be?


She been there all this time, working way up and never knew a thing? 

At the very least it is an indictment of the kind of shop her father ran!

Related: Monday's Chow

I've lost my appetite:

"Star New Orleans chef steps down amid sexual harassment allegations" Associated Press  October 23, 2017

NEW ORLEANS — New Orleans celebrity chef John Besh stepped down from management of the restaurant group that bears his name after a newspaper reported that 25 women who are current or former employees of the business said they were victims of sexual harassment by male co-workers and bosses.

The allegations were published Saturday by NOLA.com/The Times Picayune after an eight-month investigation. Women interviewed said male bosses in the Besh Restaurant Group touched or verbally harassed them and, in a few cases, tried to leverage positions of authority for sex.

Meanwhile, New York State Attorney General Eric Schneiderman announced a civil rights investigation into The Weinstein Co. following sexual harassment and assault allegations against its cofounder, Hollywood producer Harvey Weinstein after The New York Times and The New Yorker exposed allegations of sexual assault and harassment spanning decades.

Yeah, they are real heroes, those who ignored and quashed it. The Times was forced to run it once the New Yorker was going to or else they would look real bad.

Also Monday, ABC News said Ashley Judd will talk to anchor Diane Sawyer for Judd’s first TV interview since the actress-activist went public with allegations against Weinstein. The interview will air Thursday on ABC News platforms including ‘‘Good Morning America’’ and ‘‘Nightline.’’

Judd has described an incident two decades ago in which she said he invited her to his hotel room, greeted her wearing a bathrobe and asked if she would watch him shower.

In more Weinstein fallout, a fired Nickelodeon producer facing allegations of sexual harassment expressed regret over his behavior. Chris Savino, creator of the animated series ‘‘The Loud House,’’ posted the apology Monday on his Facebook page

Lame way to apologize.

Savino has been accused of sexual harassment by up to 12 women, according to the website Cartoon Brew, which reports on animation industry news.

Repercussions from the Besh story were being felt even before the allegations were published.....


Can you smell the stink coming from that kitchen?


"Matt Damon and George Clooney discussed the Harvey Weinstein scandal with ABC’s Michael Strahan in an interview that aired Monday morning on “Good Morning America.” “I knew the story about Gwyneth from Ben,” Damon told Strahan. “I never talked to Gwyneth about it. She handled it.” Damon has been on the defensive about Weinstein since shortly after The New York Times and The New Yorker published their exposes about the Hollywood mogul.  Despite hearing the rumors, Damon told Strahan he never saw such behavior from Weinstein in public. “If he did . . . if there was ever an event or something that I was at in public with Harvey, and he was doing this kind of thing . . . I missed it. And if I somehow missed it, then I’m sorry. . . . .”

Yeah, whatever. The expose is years late and they were all laughing in 2013.

Megyn Kelly blasts O’Reilly

Better off not courting anyone these days:

"Embattled western Mass. judge faces sex misconduct probe" by Andrea Estes Globe Staff  October 24, 2017

The presiding judge of Belchertown District Court is under investigation by the state’s Judicial Conduct Commission after a former court employee accused him of pressuring her for oral sex.

Judge Thomas Estes, who was removed from hearing cases without explanation in August, admitted having a sexual relationship with Tammy Cagle, a clinical social worker, according to a signed statement he submitted to the Massachusetts Commission Against Discrimination. Cagle, who worked at the Pittsfield drug court where Estes sat once a week, filed a sexual harassment complaint against the executive office of the Trial Court in July.

In her complaint, Cagle, who worked for a social service agency that contracted with the court, said she became involved with Estes when they attended a conference in 2016. She said she felt coerced to perform sex acts and that when she tried to break off the relationship he told her “it would be worse for me if someone found out.”

Estes, 50, who was appointed by then-Governor Deval Patrick in 2014, was not available for comment. His lawyer, David Hoose, said only that “Judge Estes is cooperating with the appropriate agencies in the investigation.” In August, Estes was reassigned to administrative duties in Holyoke, where he remains, according to trial court spokeswoman Jennifer Donahue.

The judge came under fire last year for showing leniency to sex offenders. Thousands of people signed an online petition calling for his removal after he sentenced to probation a former star athlete who admitted assaulting two unconscious women at a party. Prosecutors were seeking two years in jail for the defendant. Estes also was the subject of controversy after he declined to order an ankle bracelet as a condition of bail for a girls’ basketball coach accused of masturbating in a Holyoke Mall store.

What is with the sickos and perverts when it comes to sports and sex abuse?

In its answer to Cagle’s complaint, the trial court argued the relationship was consensual and said there is nothing illegal about “sexual relationships between individuals in the same workplace. Here, the evidence will demonstrate that Ms. Cagle initiated this relationship with the presiding judge, welcomed the behavior, and continued to pursue this relationship even after she moved out of state.”

Maybe it is time to revisit that, as Nazi-like as it seems (remember, they regulated sexual interaction).

The labor lawyers working for the trial court apparently did not consult top court officials before filing that response. It was those top officials who, concerned about the allegations against the judge, lodged the complaint against Estes with the Judicial Conduct Commission, according to two sources with direct knowledge.

Donahue, the court spokeswoman, said the “trial court plans to amend its filing when the ongoing investigation is completed.”

In her complaint — in which she is seeking nothing other than a finding that she was harassed — Cagle said that after the conference, the judge continued to ask for oral sex in his chambers even though both of them admitted their actions at the conference were wrong.....

I don't want to know anymore about what happened in the judge's chambers. 

One of the last positions that held an aura of respect and probity and now, pffft.


The men are like rabid dogs, aren't they?

Do you think football has anything to do with it?

"Rose McIntyre says she wonders whether her refusal to grant regular sexual favors to a white detective prompted him to retaliate against her black son, who spent 23 years in a Kansas prison for a double murder he did not commit. The case has outraged the poor black community of Kansas City, Kan., and highlights why many African-Americans do not trust police and the US criminal justice system....."

Have you notice that the cop shootings have gone down or been downplayed since Trump while the football anthem protests cause has been recast?

Well-known Moscow journalist stabbed by attacker

Reminds me of the Maltese blogger.

Not much about Amazon today except a brief blurb in the business section (Amazon says it will announce a decision sometime next year).

"General Electric stock dives on fear of dividend cut" by Thomas Heath Washington Post  October 23, 2017

WASHINGTON — The litany of bad news for Boston-based General Electric Co. mounted on Monday as Morgan Stanley and UBS downgraded their ratings for the beleaguered industrial colossus following a disappointing earnings report last week from the one-time blue chipper.

The share price was down more than 6 percent — its largest drop in six years — as investors anticipated the end of its 4 percent-plus dividend. Pensioners, savers, and investors have for decades relied on the success of the GE share price and its clockwork payouts of dividends.

The fall in the share price at the iconic company, cofounded by Thomas Edison, follows several weeks of uncomfortable news, including resignations among GE’s top management ranks, an early departure by former chairman Jeffrey Immelt, and cutbacks such as scrapping the GE corporate fleet and eliminating company cars for hundreds of executives.

‘‘It’s been brutal, one piece of bad news after another,’’ said Scott Davis, lead research analyst at Melius Research. ‘‘I think the stock is darn close to a bottom. How much worse can it get?’’

So glad they relocated their HQ to Bo$ton!

‘‘They missed their cash flow targets so badly,’’ said Barbara Noverini, an equity analyst at Morningstar. ‘‘We are looking at them not being able to cover their $8 billion dividend commitment without dipping into capital needed to support future growth.’’

‘‘They’ve done everything wrong,’’ said Ivan Feinseth, chief investment officer at Tigress Financial Partners. ‘‘The key is what’s going on going forward. This new CEO has shown he is different than GE has had in the past. He has the opportunity to turn around one of the world’s most iconic companies. If he’s successful, it could make him one of the world’s greatest CEOs.’’

GE is in that much trouble?

It is a big fall for an industrial conglomerate that was once considered the bluest of blue chips — widely admired by investors, head hunters, and business schools as a factory that churned out world-class managers. It does everything from manufacturing locomotives to finding oil.

GE is the only company remaining from the 12 original components of the Dow Jones industrial average in 1896.

But the company lost its momentum under Immelt, who led it in some difficult times. He took over as chief executive from legendary manager Jack Welch just days before the Sept. 11, 2001, terrorist attacks.

The books were already burning.

Immelt also had to navigate the global financial crisis of 2008-09. He undertook a vast overhaul of the conglomerate’s portfolio, including selling off a large portion of its financial arm, GE Capital, and investing in the oil industry.

‘‘After the financial crisis, he started making the right moves,’’ Noverini said. ‘‘Transformation takes time and discipline. If anything, there was too much exuberance at the get-go and not enough execution. Now it’s time for execution.’’

In that vein, others share her optimism about the company’s prospects: Bank of America Merrill Lynch on Monday upgraded its rating from neutral to buy, saying that the company’s bad news was cooked into the current share price in the low 20s.....



"Industrial and technology companies and retailers stumbled Monday as stocks began the week with losses. General Electric suffered its worst one-day loss in six years following downgrades from analysts. GE’s struggles weighed on industrial companies, while big technology companies liked Facebook and Alphabet declined. Toy companies Hasbro and Mattel tumbled after Hasbro’s sales forecast disappointed Wall Street; consumer companies like Amazon and McDonald’s also slipped. Investors did far more selling than buying as a seven-day winning streak ended. It was the worst day for stocks in about seven weeks, but it was still a fairly small decline. The S&P closed at an all-time high every day last week....."

I don't know how you are going to perceive this, but I am going to ignore Halloween and Thanksgiving and will not be blogging until after Christmas.