Monthly Archives: February 2016

The company behind the New York Stock Exchange is eyeing global domination

Sprecher speaks at the Sandler O’Neill + Partners, L.P. Global Exchange and Brokerage Conference in New York
Thomson Reuters

Atlanta-based Intercontinental Exchange – the owner of the New York Stock Exchange – is considering making a counter bid for the London Stock Exchange, Bloomberg News reports.

This comes just a week after the British stock market operator confirmed it was in merger talks withGermany’s Deutsche Boerse.

ICE has engaged Morgan Stanley as an adviser, the report said. Robey Warshaw is the lead adviser for LSE, while Perella Weinberg is the lead financial adviser to Deutsche Boerse.

ICE, led by Jeff Sprecher, is a repeat acquirer. It acquired NYSE Euronext in 2013, lating spinning out the Euronext business. Late last year, it sealed a $5.2 billion deal for Interactive Data Corporation.

Click here to read the full story over at Bloomberg.

The UN kicked out one of its most dogged journalists — and he spent part of this week reporting out of a park across the street

Matthew Lee of Inner City Press working out of Ralph Bunche Park, across the street from United Nations headquarters in New York City. The UN’s daily noon press briefing appears on his laptop screen.
Armin Rosen/Business Insider

One of the fixtures of the UN press corps spent the first three days of this week reporting out of a public park.

On a rainy Wednesday morning, Matthew Lee of Inner City Press had set up a laptop and smartphone-based wifi hotspot on a row of benches under a construction scaffold in Ralph Bunche Park.

Lee sat with his laptop just feet away from a towering metal sculpture and a broad flight of stairs named after the Soviet dissident Natan Sharansky – and across the street from the UN’s Manhattan headquarters.

That day, Lee wasn’t allowed in the complex sprawling across the other side of 1st Avenue without someone signing him in as a guest. The park was the closest he could get to the UN.

“It’s so different doing it this way,” Lee, who had his UN resident correspondent credentials abruptly stripped from him last Friday, told Business Insider. People were occasionally bringing him files, but Lee said running his phone as a wifi hotspot limited his ability to contact sources.

He was also hampered by his distance from the center of the action after being cast out of the institution he covered for nearly a decade.

“Today the Security Council voted on Yemen sanctions,” Lee told Business Insider. “People are tweeting at me asking, what does it mean?”

The UN headquarters towered over the opposite side of 1st Avenue, the neatly set tables of the delegates’ dining visible through 4th-story window, and the front gates opening for the occasional black SUV. When Business Insider met Lee on Wednesday morning, he had just finished watching a briefing on the humanitarian situation in Syria on his laptop.

But for the first time since 2006, the work of the United Nations – significant and scandalous at times but usually just as plodding and routinized as that of any other large organization – was continuing without him.

On the afternoon of February 19, UN security presented Lee with a letter, signed by UN Under-Secretary-General for Communication and Public Information Cristina Gallach informing him he had until 5 p.m. to clean out his office. According to Lee, the letter said his pass was revoked as the result of a January 29 incident, in which he watched, recorded, and live-tweeted a meeting of the United Nations Correspondents Association (UNCA) from an interpreter’s booth in the UN press briefing room.

Although Lee was not invited to the meetup, he claimed no closed meetings could be held in the briefing room and that he was within his rights to cover the event.

Stephane Dujarric, the spokesperson UN Secretary General Ban Ki-Moon, told Business Insider that Lee had violated the UN correspondents’ accepted standards of behavior in entering an interpreter’s booth to observe what was considered to be a closed meeting and then refusing to leave the briefing room.

“You have more than 150 resident corespondents here, and nothing physically stops them from poking along on different floors and going places they shouldn’t go,” Dujarric told Business Insider. “If over 99% of the people behave when there’s somebody who clearly breaks the rules there has to be a little bit of consequences. Otherwise it doesn’t work.”

Wider Image: Inside The United Nations Headquarters
Thomson Reuters

Lee has reported extensively on alleged corruption within the UN system, a beat he claims his press corps colleagues have ignored. He’s had a contentious relationship with UNCA – he actually served as a vice president of the organization but quit in 2012 to found the Free UN Coalition for Access – and has been generally critical of the UN press corps.

He believes the UN-based press is passive, deferential, and generally incurious about the organization they’re supposed to be covering.

“A number of people have said to me look, just write about the UN. Don’t write about the journalists at the UN. I didn’t come here to do that, but I’ve concluded that that’s part of the story,” Lee told Business Insider.

“The place is legally protected,” Lee says, in reference to the UN’s immunity under the US law, the result of the US’ 1970 accession to the Convention on Privileges and Immunities of the United Nations. “But it’s also journalistically protected.”

Lee says that February 19, he was marched out of UN headquarters by UN security guards, who Lee claims had physically ripped his press badge off of him.

He claims that he was removed from the UN “without the most basic due-process,” and says he was never questioned over the details of the January 29 incident – the details of which are still in dispute.

When contacted for comment, the Office of the Undersecretary General for Communications and Public Information did not deny that Lee had never been questioned over the incident before his pass was revoked.

“In conducting its investigation into the incident on 29 January, [Department of Public Information] reviewed several videos of what happened, including footage that was taken by Mr. Lee and posted on his website,” a representative of the office wrote in an email to Business Insider. “DPI also spoke at length with the Office of the Spokesperson for the Secretary-General and officers from the UN Department of Safety and Security who were in attendance on 29 January. These steps were sufficient to determine that Mr. Lee’s actions clearly infringed the guidelines that apply to all correspondents at the United Nations.”

Lee thinks he was summarily ejected from the UN press corps. “The UN cannot be throwing journalists into the street,” says Lee. “More fundamentally, the UN cannot do a supposed investigation of an incident for three weeks without talking to the defendant once. Not once.”

The UN General Assembly chamber
Getty Images/Mario Tama

Still, on Wednesday, Lee said he had everything he needed to cover the UN from across the street, even if his situation was far from ideal. Since Monday, he had been emailed documents from contacts in Burundi, and one of his sources had handed him a draft version of a Security Council resolution, which he scanned at a nearby FedEx store. He had written a story on press freedom in South Sudan that morning.

And he had discovered a way to save himself from having to hunt for a power outlet at a nearby coffee shop: A line of lights running across the ceiling of the construction scaffold had an electrical socket. And while the socket hovers awkwardly from a ceiling roughly 6 feet off the ground, the day before, a man who Lee says he had seen frequently in the park – a Haitian immigrant who claimed to be a former journalist, and who would often talk to Lee about affairs in his country of origin – promised to find him an extension chord. Sure enough, he brought one in a black plastic bag, which was sitting on a park bench next Lee’s laptop.

The scaffold was enough to keep his computer dry amid a persistent rain, although cold raindrops flecked the outer edges of his computer screen. A wireless mouse sat on top of a damp packet of papers.

Lee was exhibiting remarkable durability amid a punishing February downpour. “As you see, we’re perfectly dry here,” he said, although that wasn’t entirely true.

The view of UN headquarters from Ralph Bunche Park
Armin Rosen/Business Insider

Thanks to the UN’s immunity under US law, the world body is practically a state unto itself, and Lee has little recourse outside of the UN system. Lee realizes he can’t sue his way back into resident correspondent status. He could start building political pressure – Lee is an American citizen, and the US is the UN’s largest budgetary contributor. But he says he’s “queasy about saying no no, wait a second, this is the UN, I’ve got the US behind me.”

Lee had a potential ticket out of Ralph Bunche park, though. During Monday’s noon press briefing, Dujarric, the UN spokesman, confirmed the world body had offered him a “non-resident correspondent” pass on a four-month trial basis. As a result of his new status, Lee claims he would have to vacate his office, work out of a reporters’ bullpen, and leave UN headquarters by 6 p.m. each day (Dujarric confirmed to Business Insider that Lee would have vacate his office under his new status).

On Wednesday Lee told Business Insider he won’t accept reduced access, even though he’s willing to acknowledge wrongdoing as part of some full restoration of his earlier status.

“You say we had a misunderstanding, you did something we don’t like, we overreacted, why don’t you clean my garage and we move on. That’s how I view it. That’s not how they view it. They view it as like, no, we didn’t make a mistake, you made a mistake.”

As Lee notes, the UN is notably unwilling to admit wrongdoing. “They didn’t apologize for killing 10,000 people in Haiti,” Lee says, in reference to the UN’s role in that country’s cholera epidemic, “so I don’t expect them to apologize for pushing me into the street.”

The UN was a vague curtain of blue-tinted windows hovering across a damp 1st Avenue. Although behind a security cordon and a high black fence, it was a place that Lee had come to know intimately over a decade of coverage. It was a place he didn’t want to return to on anything less than his own terms.

“If I took this deal I’m hurting my readers, viewers, and the entire profession of journalism because I’m sending a message that if you ask hard questions they can screw you and you take it because you’re desperate,” Lee said. “And I am desperate. I want to be there. But I’m not so desperate that I’m going to sell out, you know?”

Renovated UN Security Council.
Royal Norwegian Consulate General New York via Dwell

By Thursday, he had changed his mind.

Dujarric told Business Insider that Lee actually had picked up his green pass, and was back in the building working – even though he would still have to clean out of his office.

I asked Lee by email why he had opted for a course that he had described as capitulation just a day earlier.

“Thought about it a lot,” he wrote, noting that he was “working on lawyer’s letter demanding no touching of office or files until this is resolved.”

Then he listed nearly a half-dozen events unfolding inside Turtle Bay – topics that would be obscure even to some international news junkies.

“Needed to cover today’s North Korea, and tomorrow’s Syria, UNSC meetings wanted to ask the UN, in the noon briefing, about Ban Ki-moon covering up or over the problems in Burundi, including of press freedom (only two of five radio stations re-opened, with agreements on what they can say — like UN is trying) and about Western Sahara, Darfur repatriation scoop I wrote yesterday in park,” and allegations of corruption within the UN system “which I came back in and asked about. So here I am.”

Meet the Canadian Army’s new ‘live’ mascot

Juno, Canada’s Army’s new living mascot.
Canadian Army via Twitter

A five month old, 20 some odd pound polar bear cub took the name of Juno, and was named as the new living mascot of the Canadian Army on Thursday, according to CBC News.

The bear, born on November 11, 2015, or Remembrance Day, Canada’s version of Memorial day, was named Juno after the hundreds of Canadian soldiers who were killed or wounded during the 1944 allied storming of Juno beach on D-Day.

“We are proud and happy to adopt Juno to the army today, and to promote her immediately to the rank of private,” said Brigadier General David Patterson of the bear.

“Polar bears are brave, strong, resilient, tenacious, agile and more than capable of defending themselves, just like our Canadian soldiers,” said Patterson.

Juno will live with his mother at the Toronto zoo, and will join her in the exhibit starting on February 27.

Watch video of the Toronto zoo and Canadian Army’s announcement below:

Investor who wants to get Yahoo CEO Marissa Mayer fired explains why his plan would work

Jeff Smith, CEO of Starboard Value
Thomson Reuters

Starboard Value CEO Jeffrey Smith is one of the most powerful activist investors in the world.

His job is to find an underperforming company, buy a bunch of its shares and rally other shareholders to pressure the board to make changes that he believes will improve the business. His firm often gets a number of board seats to take control of the company, and replaces the existing management too.

His latest target is Yahoo, the troubled internet company that lost roughly 30% of its value last year. In a letter sent to Yahoo’s board in early January, Starboard demanded “significant changes” at the company, including a change in management, and threatened to launch a proxy fight, if its demands are not accepted.

Smith rarely speaks to the press so it’s not always easy to get a sense of his thinking. But at the MIT Sloan Investment Conference held last week, Smith shared some of this thoughts about Yahoo.

According to Reuters, Smith said he sees “a lot of opportunity” in Yahoo, adding the current management hasn’t had “terrific results” turning around the company so far. Although he didn’t further elaborate, he did give a comment that shows how powerful of an influence he believes activist-appointed directors can be on dysfunctional company boards.

“The light bulb will go off and they do a better job. Sometimes they’ll turn around so fast that we have sometimes put them on other boards,” Smith said.

In other words, Smith believes an activist investor could bring urgency to a sluggish board, and fuel a successful turnaround plan. Starboard has a history of doing this: After Starboard replaced the entire board of Darden Restaurants, the owner of Olive Garden and other chain restaurants, the company’s stock value increased by more than 20%.

Smith’s comments come on the heels of a report saying talks between Yahoo and Starboard has been intensifying. According to the NY Post, Yahoo’s board is close to offering Starboard two board seats, while the activist firm wants at least four seats to take majority control.

If the NY Post report is true, that means Yahoo is leaning towards reaching a settlement with Starboard, instead of going on a full-blown proxy fight. Meanwhile, the month-long period to nominate new directors for Yahoo’s board officially kicked off last week, meaning technically the fight between Yahoo and Starboard is already underway.

Snapchat just poached a key ad exec from Facebook to turn on the money jets

Sriram Krishnan is moving from Facebook to Snapchat.

Snapchat is getting serious about making money from advertising and has hired a key player from Facebook to do it.

Re/Code first reported that Sriram Krishnan is leaving Facebook for the ephemeral messaging app. At Facebook, Krishnan led one of the upcoming threats to Google’s ad dominance: Facebook Audience Network.

As its product manager (also known for making “Hamilton” references), Krishnan helped Facebook unlock money by taking its advertising to publishers outside of the app, keeping user’s newsfeeds clutter free and making more ad units available to advertisers.

That’s the kind of expertise Snapchat needs to make money as a growing company. And at Snapchat, Krishnan will be responsible for boosting its monetization efforts.

In the past week, Snapchat announced it’s signed a deal with Nielsen to start measuring its ads in a way that models it like a TV network. Snapchat hopes to promote itself as a better place for advertisers to spend money by giving them a metric, like gross rating points, that they could compare against ratings on a traditional campaign.

Given Krishnan’s strength at finding revenue in new places, he’ll be a key factor in whether Snapchat finds a good way to make money from its disappearing messages. Previous attempts like a Lens Store for users to buy crazy filters shut down only after two months as Snapchat refocused on building out the advertising business.

A New York judge just ruled that the FBI can’t force Apple to unlock iPhones

Flickr/Anthony Starks

A federal judge in Brooklyn has ruled that the government can’t force Apple to help break an iPhone’s passcode security.

No, it’s not the San Bernardino shooting case, a similar situation where the FBI is seeking to compel Apple to provide custom software to help it access data on a criminal’s iPhone.

Instead, the device in question belongs to Jun Feng, a meth dealer. The government attempted to use the All Writs Act to compel Apple to help it access data on Feng’s phone last year, in a preview of the controversy that would explode around San Bernardino shooter Syed Farook’s iPhone.

Law enforcement found an iPhone 5S during a search of Feng’s house. Feng claimed to have forgotten his passcode, and the US Drug Enforcement Administration enlisted the Federal Bureau of Investigation to help it crack what was on the phone.

Federal Magistrate Judge James Orenstein, who was overseeing the order, questioned whether the All Writs Act was sufficient legal footing, and publicly asked Apple whether it had any objections.

Apple lawyers argued in October that what the government was asking was for the power to force it to break the security on its devices.

“We’re being forced to become an agent of law enforcement,” an Apple lawyer said in court.

A senior Apple executive speaking on the condition of anonymity told reporters that the New York case is similar to the San Bernadino case and Monday’s ruling should have a “persuasive effect” going forward.

During a court hearing, the government argued that Apple had similarly bypassed the lock screen on similar iPhones 70 times before. Feng’s phone was running iOS 7, an older operating system that doesn’t encrypt its data by default.

Even after Feng pleaded guilty, the government tried to compel Apple to provide technical assistance.

On Monday, Orenstein ruled in Apple’s favor. From the ruling:

I conclude that under the circumstances of this case, the government has failed to establish either that the AWA permits the relief it seeks or that, even if such an order is authorized, the discretionary factors I must consider weigh in favor of granting the motion….

As explained below, after reviewing the facts in the record and the parties’ arguments, I conclude that none of those factors justifies imposing on Apple the obligation to assist the government’s investigation against its will. I therefore deny the motion.

Here’s the whole ruling:



New York City has the dirtiest public transportation system of all major US cities — here’s what the germs look like up close

A sample from every subway line in New York City
Craig Ward

If you’re a germophobe, you might want to stay away from the New York City subway.

A recent study by Travelmath found that the New York City subway has the most germs of five major US public transit lines, beating out Washington, DC, Boston, Chicago, and San Francisco. Researchers found that underground trains in New York had an average of two million colony-forming units per square inch, according to Conde Nast Traveler. That’s roughly 900 times the number of germs found on a typical airplane tray table.

But if you’re a typographer, designer, and photographer with a twisted fascination for germs like Craig Ward, you might want to swab a sample, take it home, put it under a microscope, and snap a picture.

Ward began taking samples of germs from across all 22 New York City subway lines in the summer of 2015. For each sample, he cultivated the germs into the shape of the train line’s name, creating a depiction of the subway system that is both grotesque and captivating.

While his findings may not be 100% accurate given his less-than-precise process, he told us that his results “are true with a degree of certainty.”

To gather samples, Ward used damp sterile sponges that were cut in the shape of the subway line’s name. He’d then put the findings into triptych soy agar and seal them in a petri dish, which cultivated growth.

Samples from the R subway line.
Craig Ward

Ward collected his samples during off-peak subway hours, when the trains wouldn’t be as crowded. Regardless, no one ever questioned him while he diligently sponged down the poles. “Let’s be honest, you can kind of do as you please on the subway,” Ward told Business Insider. “People are pretty tolerant.”

From top left, germs from the G, L, S, and 7 lines.
Craig Ward

“Most of what I found was really very common and is no more than you’d expect to find by, say, shaking hands with a group of people before a meeting,” he said.

From top left, the 4, 5, 6 local, and 6 express lines pictured.
Craig Ward

Ward’s 7 train sample contains Staphylococcus aureus, which is a common cause of skin infections, sinusitis, and food poisoning. Also on the 7 train was Micrococcus luteus, which is the normal flora of the skin and is also found in saliva and sweat.

Craig Ward

The Times Square Shuttle sample contains E. coli, salmonella, and Staphylococcus aureus. E. coli causes gastroenteritis and urinary tract infections, and is commonly found in the lower intestine.

Craig Ward

The G train sample contains E. coli, salmonella, Micrococcus luteus, and Bacillus subtilis — which is found in soil and humans’ gastrointestinal tract.

Craig Ward

The L train sample contains E. coli, Proteus mirabilis, Micrococcus luteus, Bacillus subtilis, and Serratia marcescens, which Ward describes as “bathroom slime, and the leading cause of hospital-acquired infections.”

Craig Ward

The D train sample contains E. Coli, Staphylococcus aureus, and mold. The mold is typically from decaying organic matter, or possibly food.

Craig Ward

Ward told us he finds his discoveries to be “genuinely very beautiful … they make an excellent visual analogy for the diversity of the city at large.”

From top left, samples from the N, Q, and R lines.
Craig Ward

But he does think a bit differently now when he gets onboard with his 2-year old daughter. “I don’t really like to see her touching the railings and then putting her hands in her mouth,” he said. Here, the B, D, F, and M lines all had traces of E. coli and some Staphylococcus aureus, which is a common cause of skin infections, sinusitis, and food poisoning.

From top left, samples from the B, D, F, and M lines.
Craig Ward

This is the new flagship VW luxury sedan — but you can’t have one


Volkswagen introduced its new Phideon luxury sedan today, ahead of the 2016 Geneva Motor Show.

The Phideon is expected to be the successor to the company’s much-maligned Phaeton sedan, which will cease production in March.

There’s one catch. Unless you live in the People’s Republic of China, you can’t have one.

That’s because the car will launch there in the third quarter of 2016.

In fact, VW’s Chinese partners at Shanghai Automotive even provided design input for the company’s German design team.

The German automaker goes as far as calling this car the “new face of Volkswagen luxury sedans.”

According to the brand’s head of design Klaus Bischoff, the Phideon is a European offering for China’s style-conscious consumer.

The top-of-the-line Chinese market Phideon sedan will be powered by 3.0-liter, 296-horsepower, turbocharged V6 engine. Lower-end models of the car will be available with a four-cylinder engine. According to VW, a plug-in hybrid version is also in the works.

The Phideon sedan is built on VW Group’s highly praised MLB platform, which also underpins a wide range of cars including the Audi A4, A8, and Porsche Macan.

It’s unlikely that the Phideon in its current guise will make it to the US or Western Europe without upgraded powertrains. Although, economics may preclude VW from doing so even if it wanted to make the move. For all of the Phaeton’s exceptional capabilities, it was an absolute sales failure for VW in the US and much of Europe.

However, with the Chinese demand for chauffeur driven sedans, the Phideon has its best chance for success in the Middle Kingdom.

Volkswagen has not announced pricing or a production location for the Phidoen.

A Rhode Island high school basketball team blew a state championship by celebrating too early

The Burrillville High School basketball team lost the Rhode Island state championship to Chariho High School in brutal fashion on Monday.

Burrillville took a 59-58 lead with four seconds remaining, forcing Chariho to inbound the ball for a game-winning shot attempt.

As Chariho did so, a player from Burriville stole the pass, seemingly ending the game as he ran down court with the ball.

As the Burrillville player celebrated, he tossed the ball in the air as the team ran onto the court. However, a Chariho player caught the ball and called timeout before the buzzer sounded.

The Chariho player managed to catch the ball and call timeout with less than a second left.

Via WPRI/YouTube

So, the refs had to break up the celebration, reset the clock, and Chariho had another chance at a last shot.

They ran a fantastic lob play for the game-winning layup:

Unfortunately, it was a tough moment for No. 2, who had tossed away the ball after the steal.

Via WPRI/YouTube

Lukcily for Burrillville, they are neither the first, nor will they be the last team, to spoil a win by celebrating too early.

(h/t SB Nation)

STRATFOR: A world without cash is looking inevitable

Anti-austerity protesters burn euro notes during a demonstration outside the European Union (EU) offices in Athens, Greece June 28, 2015.
Alkis Konstantinidis/Reuters

Physical currency is going extinct, according to Stratfor.

In a recent paper, the global forecaster said that the world is on a march to a cashless society and even if there are setbacks the endgame is inevitable.

“All of these trends, allied with the unstoppable progress of technology, will likely make cashless transactions ever more prevalent in the global economy, especially as the emerging economies of Africa and India embrace concepts such as mobile banking,” said the note.

The pronouncement was driven by a spat of news regarding the elimination of high denomination currencies.

The euro zone is nearing a decision to eliminate the 500 euro note and Harvard professor Larry Summers has recently called for the end of the $100 bill in the US.

Both moves are being presented as a way to combat criminal activity as few everyday transactions are done in high denomination currency. But according to Stratfor this is simply one part of a larger trend.

“Obviously, technological advancements are making cash-free transactions easier than ever before, but there are also distinct structural advantages to a cashless economy that make it more appealing in today’s regulatory environment,” said the note.

There were a 2 major economic shifts Stratfor highlighted:

Negative interest rates: With countries in Europe and Japan venturing into the never-before-seen area of negative interest rates, Stratfor said that a cashless society eliminates one of the biggest concern of the move. Theoretically, if banks charge consumers to hold money, then consumers will drain their account and hold everything in cash. “Electronic money eliminates this threat, of course, since money that cannot be held physically cannot be withdrawn,” said Stratfor. “In theory, then, a cashless society frees up central banks to explore an entirely new set of financial tools, which could be useful in fighting the low inflation that has so far defied already unprecedentedly low interest rates.” The rising use of capital controls: “The link between capital controls and a cashless society is simple. A geographically remote country such as Iceland, an island in the middle of the Atlantic, can easily impose restrictions on the movement of capital. It is harder, however, to stop a determined Greek national from crossing the Bulgarian border with a backpack full of 500-euro notes. As more countries consider capital controls a possibility – and much of Europe must at least consider the possibility of finding itself in Greece’s position – the attraction of a cashless society becomes stronger.”

Additionally, Stratfor said this would make it easier for countries to accurately track incomes, making tax dodging more difficult.

There will be some pushback, the firm concedes, especially from countries that have had a traumatic monetary experience in the past (think hyperinflation in Germany after the World Wars). But the 500 euro note will soon be eliminated and in Stratfor’s view, this will be just the first domino to fall.

“Of course, widespread monetary trauma or a loss of faith in central institutions could drive citizens back to cash or even into gold, “the firm writes. “But such retreats will only slow the trend; they are unlikely to reverse it.”