…unless you are “a leftist who hates liberty, or a snob who enjoys destroying civilization with your superior-sounding mendacity.” But if you’re neither of those things, “you will love this movie.” Do not believe the reviewers on Rotten Tomatoes, they know nothing.

Date: Apr 27, 2011 10:58 AM

Subject: A movie recommendation: Go see Atlas Shrugged

To:

I’ve sent to this distribution list essays on limited government, and wonky quant finance papers. Now a movie recommendation (that is itself kind of a mini-essay on limited government).

Go see Atlas Shrugged. I did and loved it.

The critics hate it like socialist cats in the bath. The movie’s producer, a hero of mine, is close to shrugging (see link below).

It’s hard to spend money, time, and blood on something, and have the critics savage it (which sadly matters a lot to success if not at all to truth), and go on.

http://latimesblogs.latimes.com/movies/2011/04/atlas-shrugged-producer-critics-you-won-hes-going-on-strike.html

I am telling you it’s good. Particularly if what you’re looking for is a rather straight (though adopted for modern times) telling of the story. Does it have its amateurish moments and characteristics?

Sure. It was made for a trifle by Hollywood standards. The same critics that, if this tiny amount of money was spent on a poorly produced and acted “Indie” film, that happened to be about a hermaphrodite Palestinian boy who after escaping fascist Israeli persecution moves to Texas to face fascist American persecution (and isn’t immediately granted his full “right” to all the healthcare the USA can afford), would sing it’s praises and laud it’s signs of a tight budget as “authentic.”

I’m not sure if we have art imitating life or the other way around, but the critics are themselves Randian characters. They have an agenda—punish those who love liberty and have the temerity to defend it, then go to parties and be lauded by their friends for their heroic progressivism. And if they can make some snobby lies about cinematography along the way, more the better. (note—a small minority of critics have not seemed ideologically motivated, with them I simply disagree thinking they are using the wrong standard)

The book was also savaged by critics of the left and right in 1957, but loved by its giant number of readers beyond almost all others.

History is repeating, but that’s because sadly little has changed. We have to fix that. On Rotten Tomatoes (wouldn’t the left love for me to have left off the “e”?) the critics have been running, wait for it, 6% for the movie, 94% against. The people have been running 85% for the movie. Now, you could argue that the people have tended to be Rand fans so that’s biased. That’s a bad argument. Rand fans would be the first, the absolute first, to savage it if it wasn’t a good movie (have you ever seen Rand fans agree on anything except loving Rand?).

If you love the book, if you like the book, if you are at all open to the arguments in the book, you will love this movie. If you’re a leftist who hates liberty, or a snob who enjoys destroying civilization with your superior-sounding mendacity, you probably won’t like it so much.

Go see the movie.

—Cliff

p.s. The movie superbly preserves a message from the book that gives the lie to so much the left says about it. The heroes are not “businessmen” and the villains “government”. The book and movie clearly show the heroes are liberty loving creators and the villains totalitarian thieves—and those thieves come in the form of big business crony capitalists (those who don’t create but use the state’s power to steal to enrich themselves) as often as government apparatchiks (and never the defenseless poor). Look for this. The movie and book are honest, the critics are not.

Cliff Asness: Go See Atlas Shrugged [NetNet]

Article courtesy of Dealbreaker

Once, five times, same diff no diff.

Goldman Sachs Bank USA, a unit of the company, took overnight loans from the Federal Reserve on Sept. 23, Oct. 1, and Oct. 23 in 2008 as well as on Sept. 9, 2009, and Jan. 11, 2010, according to the data released today. The largest loan was $50 million on Sept. 23 and the smallest was $1 million on the most recent two occasions.

Goldman Sachs President and Chief Operating Officer Gary D. Cohn told the Financial Crisis Inquiry Commission June 30 that “we used it one night at the request of the Fed to make sure our systems were linked with their systems, and it was for a de minimis amount of money.” Peter J. Wallison, a member of the Financial Crisis Inquiry Commission, then asked, “you never had to use it after that?” “No, and as I said, we used it on the Fed’s request,” Cohn replied.

Oh, did you guys want to know how many times Goldman borrowed in total? Okay, that’s where the confusion was, he thought you meant how many times that day. Total ever was five.

[BusinessWeek]

Article courtesy of Dealbreaker

Sprint-Nextel (S) this afternoon dropped the other shoe, formally stating its opposition to AT&T’s (T) announcement a week ago it intends to purchase Deutsche Telekom’s (DT) T-Mobile USA for $39 billion. Sprint CEO Dan Hesse had alluded to the company’s opposition during the CTIA-Wireless event last week in Orland, Florida.

The AT&T bid “would reverse nearly three decades of actions by the U.S. government and the courts that modernized and opened U.S. communications markets to competition,” said Sprint.

“The wireless industry has sparked unprecedented levels of competition, innovation, job creation and investment for the American economy, all of which could be undone by this transaction.”

Debate still rages over whether this deal gets done or not. RBC Capital’s Jonathan Atkin writes today that, “Most legal/policy experts we have spoken with now believe the AT&T/T-Mobile deal will be approved as political factors outweigh consumer concerns,” although both AT&T and T-Mobile face “choppy” quarters, with the risk of heightened churn and problems gaining postpaid subscribers. As for Sprint, the AT&T’s bid will distract T-Mobile, Sprint’s “principal value competitor in postpaid,” which is a good thing. He has a Sector Perform rating on both AT&T and Sprint shares. He rates Verizon Communications (VZ) Outperform.

Jamie Townsend of Town Hall Research writes that, “We believe that Verizon will eventually decide to purchase Sprint and that Sprint will recognize that such a move will be in the best interests of its shareholders.” Verizon will want to push a regulatory review of AT&T’s effort. If Verizon doesn’t do so soon, however, a takeover of Sprint won’t happen “for at least two years,” he believes. Sprint will struggle with renewed subscriber losses, Townshend believes, and so despite the takeover prospects, he reiterated an “Avoid” recommendation on Sprint shares.

Sprint shares today are up 10 cents, or 2%, at $4.78.

Article courtesy of Tech Trader Daily

The CTIA Wireless 2011 show, one of the bigger annual industry confabs, opened on Monday and winds down Today in Orlando, Florida, and so we’re getting a steady stream of reports from the field…

Cowen & Co.’s Matthew Hoffman this morning writes that in his view, the 7-inch tablet market “will be challenging” for Research in Motion (RIMM), which is going to start shipping its PlayBook computer next month.

Several contacts told us the 7″ tablet market continues to be tough territory for Samsung (SSNLF) (i.e. sell-through is not matching sell-in). We do not believe RIM’s upcoming 7″ QNX-powered tablet will see better sell-through results than Samsung’s Galaxy Tab, given its price, timing, distribution, size and app disadvantages vis-a-vis iPad 2 (e.g. same price points, later launch date, fewer initial markets/configurations, smaller screen, fewer apps).

Hoffman’s skepticism is in contrast to that of Morgan Keegan’s Tavis McCourt, who yesterday wrote that he likes the PlayBook best of all the 7-inch tablets he’s seen.

Though Apple (AAPL) was not at the show, Hoffman tried to gauge people’s thoughts on the company at the show. He writes that, “The most surprising thing to us was the fact that almost everyone pointed to the $49 iPhone 3G S as a huge seller and differentiator for AT&T (T) in the market (especially post-CDMA iPhone launch); it is not just a close- out item.”

“The real downer for the show” was AT&T’s announcement Sunday it is going to buy T-Mobile USA. “We could not find anyone on the vendor side that was excited about the combination because it takes away a customer, reduces competition in the market, and may hurt the pace of industry innovation,” writes Hoffman.

Article courtesy of Tech Trader Daily

Deutsche Bank Loses Swaps Case (WSJ)
The German Federal Court of Justice ruled that Deutsche Bank inappropriately advised bathroom-supplies company Ille Papier Service GmbH on the risks involved in buying a complex financial derivative known as a “spread-ladder swap,” which the company purchased in 2005 to limit interest payments on its loans. The court ruled that Deutsche Bank must pay €541,000 ($769,356), plus interest, in damages.

Steam Rises from Japan Plant; New 6.4 Quake off Coast (Reuters)
According to the U.S. Geological Survey Web site, a 6.4 magnitude earthquake struck near the east coast of Honshu. The earthquake struck at 6.19 pm (0919 GMT) 90 kilometers east of Iwaki, Honshu at a depth of 27 kilometers, the USGS said…Smoke and steam rose from two of the most threatening reactors at Japan’s quake-crippled nuclear plant, suggesting the battle to avert a disastrous meltdown and stop the spread of radiation was far from won.

Altman’s Evercore Climbs Wall Street’s M&A Ranks With AT&T Coup (Bloomberg)
The company’s stock jumped 12 percent yesterday as investors anticipated a boost in fee revenue from the firm’s work on AT&T Inc. (T)’s $39 billion takeover of T-Mobile USA, this year’s biggest acquisition. “We are not a small boutique anymore,” Altman, 64, said in an interview. “We now have advised on three of the five largest global merger agreements of 2011.”

Pimco Said to Raise $1.5 Billion for Fund Targeting Bank Assets (Bloomberg)
The Pimco Bravo fund, short for Bank Recapitalization and Value Opportunities, will buy debt such as troubled commercial and residential mortgages, and may invest directly in banks through securities including warrants and convertible debt. Pimco is still accepting money and expects to raise $2 billion to $3 billion in total before a final close later this year.

Goldman Partnership Memo Stirs Succession Talk (Dealbook)
Goldman sent a brief e-mail to employees on Monday announcing that Michael S. Sherwood would succeed the firm’s president, Gary D. Cohn, as chairman of the partnership committee.

Japan Maintains Threat Of Further G-7 Action (WSJ)
Japanese currency officials on Tuesday maintained the threat of further yen-selling intervention by the Group of Seven leading industrialized nations, saying joint action isn’t limited to last week’s coordinated market intervention.

AIG May Face Rivals in $15.7 Billion Bid for Assets Held by Fed (Bloomberg)
Barclays is among investors considering making a counter offer, the Financial Times reported.
“We have been told that someone else was putting together a bid,” AIG Chief Executive Officer Robert Benmosche, 66, said in an interview. “I think we can offer a little more, but the price we offered is about it. Until I see a competing bid, I’d have to wait and see.”

Man arrives to Sullivan court for DWI hearing drunk, carrying beer (Times Herald)
A Swan Lake man facing a felony driving while intoxicated charge showed up to Sullivan County Court on Monday with a bag full of beer and was promptly thrown in jail without bail. Keith Gruber, 49, had a scheduled 10:30 a.m. pretrial hearing. Gruber came to court about an hour and a half late carrying a black bag that contained four cans of Busch beer. He also was carrying an open can of Busch beer and was drunk, authorities say. He tried to throw away the can.

US Banks Oppose Tighter Money Rules (WSJ)
Even as governments freeze assets tied to regimes in Libya, Egypt and Tunisia, U.S. banks are resisting efforts to tighten international rules to prevent the flow of money from corrupt politicians. The Financial Action Task Force, part of the Organization for Economic Co-operation and Development that sets international standards for money-laundering laws, is conducting a review of its guidelines aimed at closing loopholes.The review, due to be completed later this year, comes amid criticism of banks for holding billions of dollars in assets allegedly belonging to regimes in Libya, Egypt and Tunisia. Swiss bank regulators are looking into whether a dozen Swiss banks followed antimoney-laundering laws in accepting money from officials in those three countries.

Gaddafi Attacks Rebel Towns, US Plane Down (Reuters)
A U.S. Air Force F-15E crashed in Libya overnight and one crewman had been recovered and the other was “in the process of recovery,” the U.S. military said. The crash was likely caused by mechanical failure and not hostile fire, it said.

King of Rabbits: Ancient, Gigantic Bunny Discovered (LS)
Just in time for Easter, the skeleton of a giant rabbit has been discovered, one that was once about six times the size of today’s bunnies. The fossils of the giant were discovered on the island of Minorca off the coast of Spain, a fact reflected in the rabbit’s scientific name, Nuralagus rex, “the Minorcan king of the rabbits.”

Article courtesy of Dealbreaker

Shares of companies that own and operate cellular towers, including American Tower (AMT), Crown Castle (CCI), and SBA Communications (SBAC) continue to trade down today following AT&T’s (T) announcement it intends to purchase Deutsche Telekcom‘s (DT) T-Mobile USA for $39 billion, the implication being that all these companies will lose some business as AT&T consolidates the network footprint.

However, some more information has filtered out that is worth taking into consideration: SBA and CCI both offered statements this morning that describe in detail how their networks reflect the respective AT&T and T-Mobile assets.

• SBA says in an 8-K filing that as of today it has “separate leases for antenna space with AT&T and T-Mobile on the same tower at approximately 1,533 of the Company’s 9,260 total current owned tower sites,” and that, “The total annualized site leasing revenue generated by T-Mobile at these sites is approximately $40.1 million” while “the total annualized site leasing revenue generated by AT&T at these sites is approximately $53.6 million. The weighted average remaining current term of these leases is approximately 3 years.”
• CCI said in its press release that, “As of December 31, 2010, AT&T and T-Mobile represented 21% and 11%, respectively, of Crown Castle’s consolidated revenues. Further, there are approximately 4,000 Crown Castle towers on which both carriers currently reside. Crown Castle’s revenue from T-Mobile on these 4,000 towers represents approximately 6% of Crown Castle’s consolidated revenues. In addition, there is an average of approximately 12 years and 7 years of current term remaining on all lease agreements with AT&T and T-Mobile, respectively.”

In response to both announcements, Gray Powell of Wells Fargo this afternoon writes that the impact of the deal now seems not as bad as he had anticipated.

For SBAC, he had anticipated that 7.5% of revenue might be at risk over 5 years, resulting in “a 150 percentage point drag” on his projected 9% revenue growth rate. But now he thinks only 4.4% of revenue is at risk, for a 145 percentage point drag, assuming that AT&T decommissioned “at most a net $26.5 million in revenue from SBAC.”

For CCI, “AT&T could decommission all of T-Mobile’s overlapping sites which would impact revenue by 6% over 7 years,” he thinks, down from an original estimate of 6.4%. This might rob CCI of 83 percentage points of revenue growth, not as bad as the 130 points he had originally supposed.

Powell rates SBAC stock Outperform, writing that the valuation of 13.9 times projected 2012 free cash flow per share is “very attractive.” He rates CCI Market Perform but thinks “the sell off today is overdone.”

SBAC shares are down $3.60, or almost 9%, at $37.01. CCI shares are down $1.83, or almost 5%, at $37.33. American Tower shares are off $3.80, or 7.5%, at $46.82.

Article courtesy of Tech Trader Daily

In the wake of AT&T’s (T) announcement of its intent to acquire Deutsche Telekom’s (DT) T-Mobile USA for $39, Sprint (S) this morning announced that it will let customers attach their existing phone numbers to Google’s (GOOG) “Google Voice” service, whereby call management is controlled through a variety of features offered over the Web by the software giant.

Sprint also said it will sell Google’s “Nexus S” smartphone starting this spring for $199.99 with a two-year contract.

Sprint shares are down 57 cents, or 11%, at $4.48.

Article courtesy of Tech Trader Daily

In case you hadn’t heard, AT&T (T) on Sunday afternoon said that it would acquire Deutsche Telekom’s (DT) T-Mobile USA unit for $39 billion in cash and stock, vaulting the company past Verizon Communications (VZ) as the largest U.S. Wireless carrier and creating what AT&T said would be “straightforward synnergies.”

AT&T would have 130 million subscribers under the deal, versus 100 million for Verizon, out of a U.S. total of 293 million. 

The deal, consisting of $25 billion in cash and the rest in stock, will be paid with existing cash and new debt, AT&T said. The company said it has an 18-month commitment for a one-year unsecured bridge term facility underwritten by J.P. Morgan for $20 billion. AT&T isn’t taking on any debt from T-Mobile, it said. The dividend will be supported, it said. Deutsche Telekom will get 8.5% ownership of the new entity. The deal is expected to take a year to close.

The deal will add to AT&T’s profit in the third year after it closes, based on $3 billion a year in synnergies, AT&T said, and on a combined basis, the two companies would have had $80 billion in revenue last year, up from AT&T’s reported $58.5 billion. 

AT&T will hold a conference call at 8 am, Eastern time today to discuss the deal. You can listen in on (888) 517-2464 in the U.S., or (630) 827-6816 outside the U.S., using passcode 8442095. 

A couple things were obvious in the Street’s initial response: it comes as quite a surprise, as most people figure the hurdles for regulatory approval are quite high. And it puts Sprint-Nextel (S) now in a tricky spot, as rumors in recent weeks had suggested a deal with Deutsche or a T-Mobile might be a good fit to boost the company’s competitive position. That prospect is now gone. 

Jamie Townshend, Town Hall Investment Research:  The deal is positive for AT&T, but the more interesting question is what it does to the competition. Verizon may consider a similar move, with “Sprint, MetroPCS (PCS), and Leap Wireless (LEAP) the most likely candidates, though such deals would come with “a variety of issues” for Verizon that make them far from a certainty. And, “We believe that Sprint in particular is at risk as they have lost a potential merger partner and gained an even more formidable competitor,” while Clearwire’s (CLWR) “predicament has gotten worse, in our view. While some may assume that an acquisition of Sprint by Verizon would eventually include Clearwire, we believe that it is an unlikely scenario. In the meantime, T-Mobile can no longer be viewed as a potential wholesale customer of Clearwire and we continue to believe that Sprint is moving away from a longer term commitment to Clearwire and its WiMAX network.”

Greg Miller, Collins Stewart: Reiterates a Neutral rating on AT&T. “With the proposed merger that would result in AT&T to have 129 million wireless subscribers, or roughly 43% of US total, we expect the most obvious call by everyone will be that the deal is likely to face stiff FCC and maybe even DOJ opposition.” Less competition over the long term will be a net positive for Verizon shareholders, he writes. “Although the announcement clearly pushes Sprint and Clearwire closer together [...] we also note that it likely eliminates a likely wholesale customer or even purchaser of the 20Mhz of Clearwire spectrum that had actively been shopped. For LightSquared, it simply eliminates the single most likely anchor tenant for its yet-to-be built wireless network which could jeopardize its entire business model.” This is a definite negative for the companies that own towers, including American Tower (AMT), Crown Castle International (CCI), and SBA Communications (SBAC), as there will be a combined 40,000 tower sites that T investors will expect to be pared down. 

Jonathan Atkins, RBC Capital: The stiff regulatory challenge may be eased somewhat by the fact that the big telecom workers’ union, the Communications Workers of America, came out in favor of the deal Sunday. The value of 7.1 times projected Ebitda put on the deal makes Sprint look more attractive, though there seems little prospect Sprint will get any bid unless Verizon decides it wants to create regulatory headaches for AT&T by pushing matters and buying Sprint. “Deutsche Telekom, if the deal is approved, would benefit from a higher valuation than it currently receives for TMUSA and enhanced flexibility for shareholder remuneration,” writes Atkind, while “AT&T shares may face some pressure on regulatory approval.”

Clay Moran, The Benchmark Co.: Reiterates buy ratings on the three tower stocks, despite the obvious negatives of consolidations. It’s going to take a year for the deal to get done and the tower stocks are reasonably cheap, he writes. “Tower companies have yet to disclose the percentage of revenue at risk due to possible site decommissioning,” he observes, but anyway, it’s likely to take a long time. “Longer-term, fewer networks would be unfortunate for towers. But overall network usage is the primary driver of demand for tower space and this acquisition will not impact growing consumer demand for mobile communications.”

Article courtesy of Tech Trader Daily

When Bear Stearns went down for the dirt nap three years ago to the day (more on the anniversary later), many people assumed having the firm listed as a one-time employer on the résumé would be the equivalent of pulling a Merrill, i.e. it would make you categorically unemployable. Apparently these people had never heard of a guy named John Meriweather who, despite being forced to sign up investors for his latest fund down at the dog track, is proof positive that you can blow it or work for a place that (spectacularly) blows it and it will in no way affect your future prospects. According to Bloomberg and former BSC chairman Ace Greenberg, most Bear execs have “landed on their feet.”

Three years after the collapse of Bear Stearns Cos., which helped fuel the worst financial crisis since the Great Depression, former bond executives of the firm are running businesses at one-time rivals, including Bank of America and Goldman Sachs…Among the most highly placed members of the Bear Stearns diaspora are Michael B. Nierenberg, 48, who’s now in charge of Bank of America’s global mortgage and securitized-products business; Jeffrey L. Verschleiser, 41, who runs mortgage operations at Goldman Sachs; and Scott Eichel, 36, now Royal Bank of Scotland Plc’s global head of securitized products and U.S. credit trading…Nierenberg, who oversaw adjustable-rate debt at Bear Stearns, and Verschleiser, whose purview included subprime loans, were co-heads of the New York-based firm’s U.S. mortgage business until they were promoted in late 2007, when Eichel and another trader took the posts.

Other Bear Stearns bond executives landing at rival banks include its last co-heads of global fixed income, Jeffrey Mayer and Craig Overlander, both 51. Mayer now runs the North America region for the securities unit of Frankfurt-based Deutsche Bank AG (DBK), whose sales and trading revenue rose 30 percent last quarter while five big rivals posted an average 8 percent decline. Overlander is deputy chief executive officer of Societe Generale (GLE)’s investment-bank division for the Americas. Thomas Marano, 49, global head of mortgages, rates and foreign exchange at Bear Stearns, is now CEO of the mortgage unit of Ally Financial Inc., the auto and home lender rescued by the U.S. government. Randy Reiff, 40, Bear Stearns’s head of commercial-mortgage finance and commercial-mortgage securities, now holds a similar role at Australia’s Macquarie Group. Japan’s Mitsubishi UFJ Securities USA is relying on Bear Stearns alumni in corporate bonds, including James Gorman, its managing director of high-yield capital markets.

And for those of you thinking of citing the jobless Jimmy Cayne in a misguided attempt to debunk this theory, bite thy tongues. Cayne could get a job at any firm on Wall Street, he just prefers unemployment and has been working on a project that requires his undivided attention. Details TK.

Bear Stearns Thrives In Diaspora [Bloomberg]

Article courtesy of Dealbreaker

Shares of Sprint-Nextel (S) are up 2 cents at $5.02 after Sanford Bernstein analyst Craig Moffett this morning raised his rating on the stock to Neutral from Underperform, with a $5 price target, writing that rumors last week of a deal of some kind between the company and Deutsche Telekom’s (DT) T-Mobile USA unit are “clearly credible,” and that it may be a matter of when, rather than if.

“If it does happen, a merger would be enormously costly and hideously complicated… but we believe it may still be better than the alternative for either company; that is, going it alone,” writes Moffett.

Sprint might “get a multi-year ‘hall pass’ if it were to do a deal,” writes Moffett, on the prospect of “synergies” from any deal, even though those benefits might be “years down the road,” he writes.

Moffett and his European colleague, Robin Bienenstock, estimate such cost savings for Sprint could range from $5 billion to $15 billion in net present value, or $2 per share per year, based on the mid-point of that range. Some of that is baked into the stock, but some of it isn’t, writes Moffett.

Moffett thinks the stock is “somewhat overvalued,” based on the fact that the Street seems to be expecting a “dramatic improvement in gross [subscriber additions],” but as far as he’s concerned, “A simple extrapolation of the current trajectory of gross additions, churn rate, and industry growth yields a significant post-paid subscriber loss for 2011.”

Moffett is modeling a 94-cent net loss per share this year, versus the Street at 80 cents in negative EPS.

Moffett’s dour view is in stark contrast to that of Citigroup’s Michael Rollins, expressed in the story linked to above, who reiterated a Buy recommendation on the stock and a $6 price target.

Article courtesy of Tech Trader Daily